SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 23, 2005
Level 3 Communications, Inc.
(Exact name of Registrant as specified in its charter)
Delaware 47-0210602
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1025 Eldorado Blvd., Broomfield, Colorado 80021
(Address of principal executive offices) (Zip code)
720-888-1000
(Registrant's telephone number including area code)
Not applicable
(Former name and former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 8.01. Other Events
On November 19, 2002, Gary Haegele (the "Plaintiff") commenced a stockholder's
derivative suit on behalf of Level 3 Communications, Inc. (the "Company") in the
District Court of Colorado for the City and County of Broomfield entitled
Haegele v. Scott, et al., (Index No. 02-CV-0196) (the "Complaint"). The action
was brought against the Company as a nominal defendant and against the directors
of the Company, certain former directors of the Company and Peter Kiewit Sons',
Inc. ("PKS," and together with the Company and the individual defendants, the
"Defendants"). The Complaint alleged that the director defendants, aided and
abetted by PKS, breached their fiduciary duties to the Company in connection
with several transactions between the Company and PKS including contracts under
which PKS constructed the Company's fiber optic cable network and manages the
Company's mine properties. The Complaint also alleged that in building the fiber
optic cable network, the defendants caused the Company to violate the property
rights of landowners, thereby subjecting the Company to substantial potential
liability. In addition, the Complaint alleged that Company assets were
transferred to its officers and directors in the form of personal loans,
excessive salaries and the payment of personal expenses. The action sought both
equitable and legal relief, including restitution, compensatory and punitive
damages of an unspecified amount, imposition of a constructive trust,
disgorgement and injunctive relief. The Defendants filed a motion to dismiss,
which was denied by the Court in early October 2003. Subsequently, the Board of
Directors of the Company appointed a Special Litigation Committee comprised of
an independent director with the exclusive power to conduct or cause to be
conducted an impartial and independent investigation of all matters alleged by
the Plaintiff and to determine whether the litigation should be maintained,
terminated, or otherwise disposed, in accordance with its findings as to whether
the litigation is in the best interests of the Company and its stockholders. On
August 2, 2004, the Special Litigation Committee delivered its report in which
it concluded that it was not in the best interests of either the Company or its
stockholders to pursue any of the claims the plaintiff asserted in the
Complaint. The Company filed a motion to dismiss the Complaint based on the
recommendation of the Special Litigation Committee. On May 2, 2005, the Company
filed a further motion to dismiss for lack of subject matter jurisdiction and
seeking the award of sanctions.
In July 2005, the parties began to discuss the dismissal of the lawsuit in full
with each side to the litigation to bear their own costs and expenses, including
attorney's fees. No compensation in any form has or will pass directly or
indirectly from the Company or any of the Defendants to the Plaintiff or
Plaintiff's attorneys. On August 23, 2005, the Court entered an order dismissing
the Complaint and thereby confirming the parties agreement that the Plaintiff
dismisses his individual claims against the Defendants, with prejudice and that
the Plaintiff dismisses the remainder of the Complaint against the Defendants
without prejudice. The Company received notice of the entry of this order of
dismissal on August 29, 2005. A copy of the Court's order is filed as part of
Exhibit 99.1 to this Current Report and is incorporated herein by reference as
if set forth in full.
Item 9.01. Financial Statements and Exhibits
(a) Financial Statements of business acquired
None
(b) Pro forma financial information
None
(c) Exhibits
99.1 Stiuplation of Settlement
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
Level 3 Communications, Inc.
August 29, 2005 By: /s/ Neil J. Eckstein
Date Neil J. Eckstein, Senior Vice President
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