Rolling Stone to Pay $1.65 Million to Fraternity Over Discredited Rape Story

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Rolling Stone has agreed to settle a defamation lawsuit brought by the University of Virginia fraternity at the center of a discredited article about an alleged gang rape, effectively closing the door on a pivotal and damaging chapter in the magazine’s history.

Under the terms of the settlement, the magazine agreed to pay the Virginia Alpha Chapter of the Phi Kappa Psi fraternity $1.65 million. The fraternity had originally sought a trial by jury and $25 million in damages.

“It has been nearly three years since we and the entire University of Virginia community were shocked by the now infamous article,” the fraternity said in a statement, “and we are pleased to be able to close the book on that trying ordeal and its aftermath.”

The fraternity said it planned to donate “a significant portion” of the settlement to groups that offer sexual assault awareness education, prevention training and victim counseling services on college campuses.

Rolling Stone declined to comment. Court papers on the settlement have not been filed but are expected in the coming days.

The settlement essentially brings to an end the legal issues facing Rolling Stone over the 9,000-word article published in November 2014. In April, the magazine and the writer of the article, Sabrina Rubin Erdely, settled a suit brought by a University of Virginia administrator, Nicole P. Eramo, who said the article defamed her and portrayed her as the “chief villain” of the story. (A federal jury had awarded Ms. Eramo $3 million in damages in November 2016.) A third lawsuit, filed by three former fraternity members, was dismissed last June, though that decision is being appealed.

The article, “A Rape on Campus,” was retracted in April 2015 after a Columbia Journalism School report that said the magazine failed to take basic journalistic steps to verify the account of a woman, identified only as Jackie, who said she was the victim of a gang rape. It was an embarrassing episode for a magazine that has long prided itself on its journalistic accomplishments.

The reputational hit also coincided with industrywide financial pressure.

In September, Wenner Media, the magazine’s parent company, sold a 49 percent stake in Rolling Stone to BandLab Technologies, a Singapore-based music technology company led by Meng Ru Kuok, the son of an Asian business tycoon. And in March, Wenner sold the celebrity magazine Us Weekly to American Media Inc., the publisher of The National Enquirer, for a reported price of $100 million.