Allentown School District settled with the four plaintiffs on Monday, a day before their case was to go to trial before a federal judge in Philadelphia.
A judge had called the district's response to alleged abuse by a 12-year-old student with a history of sexual misconduct was "wholly inadequate." The suit said that boy cornered first- and second-grade students in Central Elementary School bathrooms and assaulted them.
A lawyer for the plaintiffs says the settlement ensures the victims don't have to relive their experiences.
The assailant was adjudicated delinquent on juvenile charges related to a 2004 assault.