RPT-Aristocrat to settle A$396mln class action-report

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MELBOURNE, May 7 (Reuters) - Australian gaming machine maker Aristocrat Leisure Ltd (ALL.AX) is poised to settle a A$396 million ($377 million) class action brought by shareholders who said it did not accurately update the market on its earnings outlook, the Australian Financial Review reported on Wednesday.

Without citing sources, the paper said a settlement was still being negotiated with the shareholders' law firm, Maurice Blackburn, but it was believed Aristocrat would pay a large proportion of the damages claimed.

Aristocrat declined to comment and Maurice Blackburn did not return phone calls, the newspaper said.

The case stemmed from Aristocrat's downgrades to its profit forecasts in 2003 which sparked a 75 percent share price slide.

It was the first shareholder class action tied to continuous disclosure obligations to go to trial in Australia, and could bolster other class actions against companies whose shares crashed late last year, the paper said.

Federal Court judge Margaret Stone will not release her decision on the case unless the settlement talks break down, the newspaper said. ($1=A$1.05) (Reporting by Sonali Paul)