Eaton Settles Damage Claim by Meritor

Eaton Corp. has agreed to pay Troy, Mich.-based Meritor Inc. $500 million to avoid as much as $2.4 billion in damages over Meritor's antitrust claim.

Meritor sued the Cleveland-based company in 2006 for offering unfair rebates and exclusive dealer contracts that helped it gain control of 90% of the U.S. market for heavy-duty truck transmissions.

Meritor sought $800 million in damages, an amount it said would have been automatically tripled under antitrust laws. A jury trial to settle damages had been scheduled to start today.