OppenheimerFunds decided to settle a lawsuit filed by the state of Oregon over its 529 plan for $20 million, payable to 45,000 investors in the plan early next year.

Oregon had sued the firm for losses in the OppenheimerFunds Core Bond Fund, which the firm marketed as conservative but sustained $36 million in losses due to exposure to mortgage-backed securities. OppenheimerFunds said that “the settlement allows both the state and OppenheimerFunds to avoid a lengthy and expensive legal process and to apply resources to more constructive ends.”

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