Correct - no way Kim could settle without agreement to this by the plaintiffs. That also implies that the plaintiffs felt this was as good a deal as they were likely to get.
There is no way the plaintiffs would have accepted this unless they had some feel for what those properties might fetch at auction. I think your point #2 probably applies in some degree.
There is one other thing that is important here - the defendants get away without an admission of guilt or impropriety, and avoid the potential for treble damages.
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