Barclays pleased with lawsuit dismissal
Barclays Bank, the third largest in Britain, has won the dismissal of a lawsuit from an investor that claimed that the company failed to disclose the full credit market exposure it had at the time it had offerings of $5.45 billion in US depositary shares.
The judge hearing the case, Paul Crotty, dismissed the 2009 suit in Manhattan by investors that accused the London-based Barclays and its underwriters over four offerings it made, including parts of Bank of America, Goldman Sachs Group and Morgan Stanley, but failed to disclose that it held vast amounts of high-risk mortgage-backed assets.
Plaintiffs argued that the defendants’ disclosures pushed them into wrongfully believe that Barclays’ securities at the time were less risky than most of its competitors. According to the complaint, Barclays made the four offerings between April of 2006 and April of 2008, that generated proceeds of just under $5.5 billion.
Speaking in a statement, Barclays told how it was pleased with the decision that had been made. Probably planning his next move, Andrew Brown, who is the lawyer for the disgruntled investors, didn’t return calls for comment that were demanded of him by the media.
In addition to this, the investors also claim that Barclays misleadingly assured each one of them that its bank’s risk management practices would help it avoid any undue credit risks that might pose a thereat. Investors allege that Barclays continued to lead them astray until the bank then released its interim results on the 30th of June 2008, which disclosed that its first-half net income had dropped 34%.