Broadcom Corp. has agreed to pay $118 million to settle allegations of stock options backdating, in one of the largest such deals in a derivative action to date.

The proposed settlement, subject to approval by U.S. District Judge Manuel Real of the Central District of California, would be the second largest in a derivative action involving stock options backdating, according to lead plaintiffs counsel Richard Heimann, name partner at San Francisco's Lieff Cabraser Heimann & Bernstein.

The largest, reached in 2007 between several pension funds and former executives of UnitedHealth Group Inc., was worth an estimated $900 million.

"It is significantly beyond in terms of actual dollar value what most if not all the derivative cases have settled for," Heimann said of the Broadcom deal. "The restatement in this instance was well in excess of $2 billion, meaning they had understated expenses and overstated revenues for a five-year period of that amount."

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