Aug 27 (Reuters) - TuSimple ( TSPH ) reached a $189

million settlement of a lawsuit accusing the self-driving truck

technology company of defrauding shareholders by overstating its

safety record and concealing three insiders' control of a

Chinese trucking rival.

A preliminary settlement of the proposed class action was

filed on Monday in the federal court in San Diego, where

TuSimple ( TSPH ) is based, and requires a judge's approval.

All defendants, including the company, various TuSimple ( TSPH )

founders and executives, and TuSimple's ( TSPH ) bank underwriters,

denied wrongdoing in agreeing to settle.

TuSimple ( TSPH ) has paid $174 million of the settlement amount into

an escrow account while its insurers have paid $15 million

there, court papers show.

The company delisted from Nasdaq in January, fewer than

three years after raising $1.35 billion in an April 2021 initial

public offering.

Lawyers for TuSimple ( TSPH ) did not immediately respond to requests

for comment on Tuesday.

Shareholders said TuSimple ( TSPH ) misrepresented the safety of its

technology prior to the IPO, with an eye toward addressing the

kinks on U.S. roads and transferring the improved technology to

the Chinese rival, Hydron.

They said the truth emerged in August 2022, when the Wall

Street Journal said an Arizona freeway crash four months earlier

underscored analyst and employee concerns that TuSimple's ( TSPH ) rush

to deliver driverless trucks put public safety at risk.

Lawyers for the shareholders may seek up to 25% of the

settlement amount, or about $47 million, for legal fees.

TuSimple ( TSPH ) went public at $40 per share. The shares traded

unchanged at 20 cents in Tuesday afternoon over-the-counter

trading on the Pink Sheets.

The case is Dicker et al v. TuSimple Holdings Inc ( TSPH ) et al,

U.S. District Court, Southern District of California, No.

22-01300.

(Reporting by Jonathan Stempel in New York)