Merrill Lynch said yesterday it had agreed to pay $164 million (€137.5 million) to settle 23 class-action lawsuits related to tainted research coverage of internet companies by former analyst Henry Blodget.

The plaintiffs said Merrill and Mr Blodget issued overwhelmingly positive research in a bid to get investment banking business from the companies that were being written about.

The settlements are subject to further agreements and court approval, the US brokerage said in a filing with the US securities and exchange commission.

As a result of the settlements, plaintiffs will drop appeals in 11 cases in which motions to dismiss were previously granted, Merrill said.

Another 12 had not yet been ruled on. It said 16 others were previously dismissed or abandoned.

"Even though we prevailed in virtually every research class action that's been adjudicated, we are settling these cases because we want to avoid the distraction and expense of further litigation," said Merrill spokesman Mark Herr.

"It's a fair settlement," said Herbert Milstein of the law firm Cohen Milstein Hausfeld & Toll, who represented 20 of the class-action plaintiffs. "This has been litigated for more than four years and we've had some adverse court rulings."

Only two class action suits related to Merrill's research coverage of internet companies remain. Mr Herr said Merrill expected to win these suits, including one brought by a Merrill Lynch stockbroker that is now before the US supreme court.

The broker is charging that the fraudulent advice given by Merrill and Mr Blodget caused both him and his clients to lose money.

Merrill said it would take a litigation-related expense of $170 million, or $102 million after taxes, in the fourth quarter for the settlements. The charge equals 10 cents per share.

The litigation grew out of investigations into conflicts of interest on Wall Street by New York attorney general Eliot Spitzer, who accused brokerages of issuing biased research to attract investment banking business.

That investigation led to a $1.4 billion settlement in December 2002 between financial regulators and 10 Wall Street firms, including Merrill, which were accused of misleading investors with biased stock research.

Mr Blodget, who joined Merrill in 1999 after his accurate prediction that Amazon.com's stock would double in price to $400 a share, rode the technology boom until it crashed.

In the settlement with regulators, he paid $4 million, and then went on to find work as a journalist.

Lawyers for Mr Blodget could not be reached for comment.