An old bankruptcy case is coming back to hit

Comcast

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right in the wallet.

The Philadelphia-based cable system operator said Tuesday that a legal settlement would slash first-quarter earnings by more than half. And the damage may not be done yet.

Comcast said it would pay

AT&T

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$170 million to cover its share of the phone giant's settlement of some lawsuits tied to the At Home bankruptcy.

At Home, a now-defunct high-speed Internet service, operated as Excite@Home until its effective demise in 2001. Comcast and AT&T, former shareholders in At Home, were named in a class action suit claiming intellectual property and disclosure infractions.

Comcast said the charge would slash its

first-quarter earnings, reported last week at $313 million, or 14 cents a share, to $143 million, or 6 cents a share.

The news came as the Excite@Home Bondholders' Liquidating Trust settled with former owner AT&T for $400 million. The settlement consists of a $340 million payment from AT&T and the release of $60 million in reserves established for the benefit of AT&T in the Excite@Home bankruptcy. Under its 2002 acquisition of AT&T Broadband from AT&T, Comcast is contractually liable for 50% of the settlement amount.

Excite@Home bondholders said Tuesday that their suits against Comcast and closely held Cox Communications continue. Comcast said a lawsuit filed in federal Bankruptcy Court against AT&T, AT&T Broadband and others seeking to recover alleged "preference" payments will be dismissed. A spokeswoman didn't immediately return a call seeking further comment.

In September 2003, a federal judge

refused to dismiss a class-action suit alleging securities fraud by Excite@Home's former owners.

At issue in the case is the technology developed by At Home to deliver high-speed Internet to households via cable systems -- technology that AT&T unfairly expropriated, according to the suit.

Late Tuesday, Comcast fell 18 cents to $31.99