On July 12, 2010, in one of the more high-profile investor actions filed as part of the subprime securities litigation wave, Southern District of New York Judge Sidney Stein substantially denied in part the defendants’ motions to dismiss in the Citigroup Bond Litigation. A copy of the opinion can be found here.
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In the latest appellate decision to affirm the dismissal of a subprime-related securities class action lawsuit, on June 29, 2010, a three-judge panel of the Ninth Circuit issued an opinion (designated "not for publication") affirming the dismissal of the securities suit that had been filed against Impac Mortgage Holdings and certain of its directors and
While many courts are showing a greater willingness to grant motions to dismiss in subprime-related securities class action lawsuits, some cases are surviving dismissal motions and others are settling for hundreds of millions of dollars, as a result of which the "watchword is uncertainty until a more consistent and predictable pattern emerges," according to a
In two different subprime securities suits, courts recently entered ruling with respect to dismissal motions going in opposite directions. In one case, the Second Circuit, in the second appellate ruling so far in connection with the subprime-related litigation wave, affirmed the lower court’s dismissal. In the other case, the district denied defendants’ motions to dismiss.
Just as the financial crisis itself has gone through various phases, the resulting litigation has also changed and evolved. A June 4, 2010 report entitled "Credit Crisis Litigation Revisited: Litigating the Alphabet Soup of Structured Products" by my friend Faten Sabry, and her colleagues Anmol Sinha, Jesse Mark and Sungi Lee, all of NERA
The rating agencies have been among the targets in many of the lawsuits filed as part of the subprime-related litigation wave. By and large, the rating agencies have been successful in knocking out these cases in the early stages, particularly the lawsuits seeking to hold them liable as "underwriters" under the federal securities laws.
In two separate decisions, two courts issued opinions in cases that each related in different ways to Credit-Based Asset Servicing and Securitization, LLC, also known as C-Bass. As discussed below, Judge Rakoff has issued an opinion substantiating his prior dismissal motion rulings in the C-Bass subprime-related class action securities litigation, and in a separate
The subprime and credit crisis-related litigation wave may now be in its fourth year, but lawsuits continue to come in. The latest of these suits – a securities class action lawsuit involving Las Vegas Sands – has a number of interesting features, and it also raises the question whether we may see even further new filings
As the subprime litigation wave evolved in late 2008, among the many cases arising were cases I described at the time as "new wave" subprime-related cases, where the target company’s financial problems were due not to the company’s own exposure to subprime-related assets, but rather due to the company’s exposure to other companies that suffered
As the various subprime-related securities lawsuits have reached the motion to dismiss stage, some of the rulings have gone for the defendants and other have gone for plaintiff. Regions Financial Corporation experienced one of each kind of ruling in two separate cases involving allegations about the goodwill the company carried on its balance sheet as