Moody’s, S&P Settle Lawsuits Over Debt Vehicle Ratings
I want to emphasize that the deal is a landmark. It is apparently the first time that S&P and Moody's have settled accusations that investors were misled by their ratings. That's unquestionably a great result for the CDO purchasers in the case and for their lawyers at Robbins Geller Rudman & Dowd, who have battled since 2008 to keep [the] fraud and negligence claims alive. Unlike investors in more than three dozen other cases claiming the credit rating agencies facilitated the issue of toxic mortgage-backed securities, Abu Dhabi Bank, the Kings County pension fund and their fellow CDO purchasers survived preliminary motions, beating back the agencies' argument that their ratings were opinions protected by the First Amendment. Then, through discovery, Robbins Geller uncovered hot documents - even more than the rating agencies produced to Congress - that helped investors withstand defense requests for summary judgment.
For full story visit Thomson Reuters.