Settlement entered its initials stages on April 27, 2005 when the judge prematurely ruled the case dismissed in light of a pending settlement. On July 6, 2005 a stipulation of settlement was filed, providing a settlement fund of $20,000,000. The settlement was finalized and the case was ordered closed on October 20, 2005. Attorneys were awarded fees and expenses in the amount of $6,267,539.19. The total amount of the settlement was funded through Amazon.com's insurers.

Plaintiffs filed their First Consolidated Amended Complaint on June 19, 2001. Defendants filed a motion to dismiss, which was granted in part. Plaintiffs amended their allegations with regards to the Section 11 claims on April 8, 2005. Defendants again moved for dismissal and were again successful, in part. The judge decried on January 6, 2003 that the Section 11 claims against Amazon.com were insufficiently pleaded and were dismissed, leaving only the Section 12a and 15 claims.

On May 21, 2001 the judge granted Sagamore's motion to be appointed lead plaintiff. However, that order was reversed after Argent Classic Convertible Arbitrage Fund's motion to intervene as lead plaintiff was granted on June 14, 2001.

The original complaint, filed by Sagamore Hill Capital Management on May 5, 2001, on behalf of purchasers of 6.875% Premium Adjustable Convertible Securities, charges Amazon.com, certain of its officers and directors and several underwriters of providing materially false and misleading information regarding the revenues to be received by Amazon under agreements reached between the Company and its partners, termed the "Amazon Commerce Network." The complaint alleges that Amazon disseminated misleading press releases announcing agreements between Greenlight.com, Drugstore.com, Audible, Inc., and Living.com suggesting that these partnerships would boost Amazon's revenues by $362.5 million over a three year period.