Westlake’s Homestore Inc. reports wider second quarter loss; settles lawsuit

Westlake Village-based Homestore Inc., the No. 1 online home-listings company, recently reported a second quarter net loss of $97.1 million, or 78 cents a share, compared with a net loss of $52.3 million, or 44 cents a share, in the same quarter last year.

The online company also settled a stockholders’ lawsuit with the California State Teachers’ Retirement System (CalSTRS), the third largest pension fund in America. Homestore will pay $13 million in cash and give 20 million shares as part of the settlement.

"We are pleased with progress toward resolving our legacy financial and litigation challenges," said Homestore chief executive officer Mike Long. "The settlements of the CalSTRS securities class action lawsuit and the Cendant dispute allow us to increase management’s attention to Homestore’s more tightly focused operations."

CalSTRS had accused Homestore of falsifying financial statements to inflate revenue.

A federal judge must still approve the settlement, officials said. The process could take as long as four to five months.

––Michael Picarella