Again, if NGN are honorable and have nothing to hide GO TO COURT.
Why would they go to court? They were defendants in this litigation, they didn't ask to be there. They weren't instigating an action to prove something. They weren't on a crusade for the truth. Why would they want their documents and conduct raked over to disprove something that the other side (ie Harry) no longer wanted to prove because he approached them to settle*?
It's not as if this was some sort of case that would particularly hold them in good stead and future proof them against future litigation. For a start, each and every case stands or falls on its own merits/facts, so successfully defending this case wouldn't particularly change anything for other potential litigants. Second, most of these cases will be timed out under the Limitation Act (and it is only Harry with his somewhat spurious arguments who was trying to get around this), so they are hardly likely to be pushing for a trial to prove their defence in order to fend off other claims, because those claims can't be brought.
And Murdoch/NGN don't really give a fuck about the court of public opinion, so they wouldn't be conducting some sort of gang-ho, crusading defense to curry favour with the public. Everyone who already thinks they are evil shit bags wouldn't change their minds about them successfully defending this case over some technical legal points of limitation and agency (ie, whether the principles knew what the contractors were up to and are therefore liable). Everyone who already hates them won't be convinced otherwise, they hate them for all manner of other things, Page 3, shitty, misogynistic and racist gossip, endorsing Thatcher smashing the miners, Hillsborough etc etc. And those who read their rags in full knowledge of everything they have pulled over the years won't have their minds changed by this case.
They paid off Harry - at his request - with what is loose pocket change to Murdoch. And why wouldn't they?
*According to the BBC's source, and we've just been told we have to believe the BBC.