AOL has agreed to settle two class action lawsuits in the US by punters who alleged the giant Internet company continued to bill them even after they cancelled their subscriptions.

Although the ISP "vigorously denies any liability in relation to these allegations" it has agreed to settle the claims to avoid the "undue burden and cost of further litigation and to resolve an ongoing matter".

Those behind the legal action allege that when they tried to cancel their subscriptions, either the cancellation request failed or the service was reactivated without their authorisation. As a result, former subscribers say they were improperly billed.

Although AOL denies all allegations, it has agreed to refund those affected with payments of up to four months of subscription fees. AOL has also has agreed to make changes in its procedures to prevent post-cancellation charges in the future.

And the giant ISP has also agreed to pay $3m for attorneys' fees and costs, subject to court approval. ®

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