According to the March 11, 2010 bankruptcy examiner’s report, the collapse of Lehman Brothers was a result of the deteriorating economic climate, exacerbated by Lehman’s executives, whose conduct ranged from "serious but non-culpable errors of business judgment to actionable balance sheet manipulation."
The Report was prepared pursuant to a January 2009 bankruptcy court order
It has now been over three years since the first subprime-related securities class action lawsuit was filed in February 2007, yet many of the cases filed in the ensuing litigation wave are still only in their earliest stages. While the vast majority of these cases are still unfolding, there have been some important recent developments
In a ruling that may have potential significance for the many claims that have been filed against the rating agencies in the subprime litigation wave, on February 17, 2010, Southern District of New York Judge Lewis Kaplan dismissed all but one of the claims that had been filed against the individual defendants in the Lehman
In one of the largest subprime-related securities lawsuit settlements so far, Moneygram Corporation has agreed to settle its subprime-related securities class action and accompanying derivative suit for $80 million, according to the company’s February 25, 2010 press release (here).
Background
As reported here, the MoneyGram case represented the distinct group of
In an interesting and potentially significant February 22, 2010 opinion (here), Southern District of New York Judge Naomi Reice Buchwald denied defendants’ motions to dismiss the plaintiffs’ ’34 Act claims in the Ambac Financial subprime-related securities suit. Judge Buchwald also denied the motion to dismiss the plaintiffs’ ’33 Act claims relating to the
Just when it seemed as if the dismissal motion rulings in the subprime-related securities suits might be breaking more favorably to the plaintiffs, two February 18, 2010 rulings granted the defendants’ motions to dismiss in two separate subprime cases. While only one of the two dismissals was with prejudice, both represent substantial defense victories.
In an interesting February 11, 2010 decision (here), Southern District of New York Judge Victor Marrero allowed plaintiffs, whose subprime-related securities class action lawsuit Marrero had previously dismissed, leave to file a second amended complaint against Credit Suisse Global and certain of its directors and officers.
Judge Marrero also found the securities
Rating agencies are not susceptible to ’33 Act liability as "underwriters," even if they helped structure the mortgage backed securities at issue, according to February 1, 2010 ruling (here) by Southern District of New York Judge Lewis Kaplan in which he dismissed Moody’s and McGraw-Hill (S&P’s parent) from the Lehman Brothers Mortgage-Backed Securities
In a 90-page January 27, 2010 opinion (here) District of New Mexico Judge James Browning granted substantial parts of the defendants’ motions to dismiss in the Thornburgh Mortgage subprime securities suit, while also denying the motions to dismiss in connection with certain claims against Larry Goldstone, who served as the company’s President
In a January 14, 2010 order (here), Southern District of New York Judge Robert W. Sweet granted the motion to dismiss in the ACA Capital Holdings subprime-related securities class action lawsuit. The decision is noteworthy in and of itself, but also because the plaintiffs’ securities claims were asserted under the ’33 Act. Subprime