Plaintiffs' lawyers held a press conference this morning to lay out a settlement of $1 billion stemming from class action suits against 308 companies and their handling of their initial public offerings (IPOs). The damages will be covered by the issuers' insurers. I guess we now know why Chubb (NYSE:CB) needed to set aside $100 million in reserves for director and officer insurance claims earlier this month, eh?

The suits charged that the IPO issuers -- including Doubleclick (NASDAQ:DCLK), Red Hat (NASDAQ:RHAT), Ariba (NASDAQ:ARBA), and Internet Capital Group (NASDAQ:ICGE) -- schemed to manipulate the prices of IPOs. The companies are accused of making misleading statements to pump up their share prices, garnering kickbacks from investors who received IPO shares, and defrauding investors who lost money when these companies reverted to their true value (in many cases, this turned out to be zero). This suit, by the way, doesn't even touch the underwriters like Merrill Lynch (NYSE:MER), Morgan Stanley (NYSE:MWD), and Goldman Sachs (NYSE:GS) for their roles in manipulating new issues higher.

You know what? All of these things happened. It may come as a surprise to hear this from The Motley Fool, but I have not the first bit of sympathy for the "victims" of these actions. During the bubble, we warned over and over that investors should steer clear of IPOs. Brian Graney wrote in early 2000 "... as's ability to get its shares priced and sold into the public market today shows, the willingness of equity investors to assume greater and greater risks is only growing." Yi-Hsin Chang described in an early 1999 article that one of the most frequent questions The Motley Fool received from readers at the time was "How do I get in on an IPO?"

Every IPO on a major market is preceded by an S-1 filing, where investors can take a peek at the company's operating history, its financials, and its business plan. Interestingly, there doesn't appear to be any mention of false or misleading statements in S-1 filings -- it's all about the action once the stock went public. In effect, then, the people who benefit from the settlement are victims all right. Victims of their own greed, and in many cases, stupidity. The public documents were available. The risks of investing in IPOs were well-known. Investors could not in any way get burned by an IPO unless they entered into the transaction of their own free will. And people were more than willing to give up a firstborn to do so.

The billion dollars (much less, after the law firm takes out its blood money) will come nowhere close to making the plaintiffs whole. But it's more than most of them deserve. They swam with sharks, wearing "Bite me, I'm Made of Meat" T-shirts. They got eaten alive. How could it possibly have ended differently?