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News Corp. settles with slain girl's kin

Rupert Murdoch's media company said Friday it has agreed to pay $3.2 million to the family of a murdered schoolgirl whose phone was hacked by the tabloid News of the World.

News International and the family of Milly Dowler confirmed the settlement in a joint statement. It said Murdoch also will donate $1.6 million to charities chosen by the Dowler family, including youth and cancer research groups.

News International is the British newspaper arm of News Corp., Murdoch's multinational media conglomerate. Murdoch shut down the 168-year-old News of the World in July after evidence emerged that the newspaper's reporters had eavesdropped on the telephone voice mail messages of the 13-year-old girl who disappeared in 2002 and was later found murdered.

That touched off a storm of public outrage that rocked Murdoch's media empire and ricocheted through Britain's political, police and media establishments.

"Nothing that has been agreed will ever bring back Milly or undo the traumas of her disappearance and the horrendous murder trial earlier this year," the Dowlers said.

"The only way that a fitting tribute could be agreed was to ensure that a very substantial donation to charity was made in Milly's memory. We hope that projects will be undertaken so that some good can come from this."

Murdoch met with the Dowlers in July to personally apologize to the family, saying he was "appalled" to have discovered what happened.

In the statement Friday, he said he hoped something positive can be done in memory of Milly.

"The behavior that the News of the World exhibited towards the Dowlers was abhorrent, and I hope this donation underscores my regret for the company's role in this awful event," he said.

The revelation that reporters eavesdropped on Milly Dowler's voicemail messages while police were searching for her -- and mounting evidence that phone hacking was routine at the newspaper -- scandalized the British public.

The scandal has forced the resignation of two of London's top police officers, ousted executives at News Corp. and claimed the job of Prime Minister David Cameron's former spin doctor, Andy Coulson, an ex-News of the World editor.

News Corp. has expressed contrition, launched an internal inquiry and set aside $32 million to compensate victims, who could number in their hundreds.

On Friday, Murdoch jousted with disgruntled shareholders at the annual meeting in Los Angeles as he defended his handling of the phone hacking scandal and deflected any notion that he plans to step down soon.

The company said a proposal to force the company's chairman to be an independent director had failed.

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