Yes, it is a true story and quite an unpleasant one for those involved.
FWIW I travelled through Blagnac a day or two after the accident happened and it was not a pretty sight. The aircraft was left in position with it's back broken across a blast wall for several days - in full view of the Terminal buildings and the travelling public. It was Nov 2007.
Link to one local newspapers coverage of the accident and the subsequent report here:
Blagnac. La vérité sur l'accident de l'Airbus - Haute-Garonne : LaDépêche.fr
Slideshow ("diaporama") of pictures here:
17h13: l'A340 fonce dans le mur (Blagnac. Crash de l'A340)