Robbins Geller Rudman & Dowd LLP Announces Countrywide to Pay $500 Million to Settle Mortgage-Backed Securities Case
San Diego, CA, April 17, 2013 – Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) announces Countrywide Financial Corporation (“Countrywide”) has agreed to pay $500 million to investors who allege that they were misled by the company’s sale of mortgage-backed securities (“MBS”) from 2005 to 2007. If approved by the court, the half-billion dollar settlement will represent the largest MBS class action recovery in history.
The plaintiffs in the case accused Countrywide, which was subsequently acquired by Bank of America, of making false claims regarding the quality of loans underlying billions of dollars of MBS issued and/or sold by Countrywide. Robbins Geller fought defendants’ repeated attempts to remove the case to federal court, which included appeals to both the California Supreme Court (where review was denied) and the U.S. Supreme Court (where certiorari was denied).
“This landmark case was the first MBS class action brought against the MBS originators and Wall Street banks responsible for issuing defective securities,” said Spencer A. Burkholz, partner at Robbins Geller. “After five years of hard-fought litigation, this record-breaking recovery is a tremendous result for MBS investors misled by Countrywide and its underwriters in connection with the packaging and sale of MBS.”
The settlement in this enormously complex case was achieved with the assistance of mediator Professor Eric Green and included attendance at mediation sessions by lead plaintiffs the State of Vermont’s Employee Pension Funds and Pension Trust Fund for Operating Engineers. Other lead plaintiffs include Maine State Retirement System, Washington State Plumbing & Pipefitting Pension Trust, Mashreq Bank, and David Luther.
The case, Luther v. Countrywide Fin. Corp., No. 12-cv-05125-MRP-MAN, was filed in the Central District of California. Robbins Geller and Kessler Topaz Meltzer & Check, LLP are co-lead counsel for the plaintiffs. The settlement also involves the resolution of two other cases – Western Conference of Teamsters Pension Plan v. Countrywide Fin. Corp., No. 12-cv-05122-MRP-MAN (C.D. Cal.), and Maine State Ret. Sys. v. Countrywide Fin. Corp., No. 10-cv-00302-MRP-MAN (C.D. Cal.).
Robbins Geller is co-lead counsel in this record-breaking recovery and represents hundreds of institutional investors in the United States and around the globe in contingency-based securities and corporate litigation. The firm is appointed to serve as sole lead counsel by district courts more often than any other plaintiffs’ securities firm and has been ranked first in the number of shareholder class action recoveries in MSCI’s Top SCAS 50 every year for the last decade. Please visit www.rgrdlaw.com for more information.
Spencer A. Burkholz
619/231-1058 or 619/571-2480