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Mega Brands magnetic toys

Mega Brands Inc. has agreed to settle a U.S. class-action suit brought on behalf of people who bought or received defective magnetic toys several years ago.

The Montreal-based company denies any liability but says wants to avoid the expense of continuing to fight the legal battle.

The deal, which has received preliminary approval for a U.S. district court in New Jersey, will essentially allow people in the United States to get a refund for the toys that were subject to product recalls in 2006, 2007 and 2008.

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Claimants for the refunds will have to show proof that they bought, received or possessed a recalled toy from 2003 to the present or submit a statement to that effect under oath.

Other defendants in the case are Mega Brands America Inc. and discount retailer Target Corp.

Mega Brands didn't announced Tuesday how much the settlement will cost it in total, although the agreement provides details on some of the expenses.

Under the settlement dated July 27, 2011, the three plaintiffs who brought the suit will receive $1,000 each and the law firms that represented them will receive up to $3.5-million in attorney fees and expenses.

Mega Brands will also make a $100,000 contribution in cash and products to a new foundation that will be formed to provide services for organizations addressing children's health issues.

The defendants also agreed to pay the costs associated with administering the claims, including a website set up for that purpose.

More details about the settlement and how to file a claim are available at www.megabrandssettlement.com. There is also a toll-free number at 1-800-760-6332.

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