High court agrees to hear Goldman Sachs securities suit
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The U.S. Supreme Court has accepted for review a divided appeals court ruling that said a shareholder class action that charged Goldman Sachs Group Inc. with hiding conflicts of interest could proceed.
The Supreme Court issued its acceptance of the case, Arkansas Teacher Retirement System West Virginia Investment Management Board et al. v. Goldman Sachs Group et al. on Friday.
In its 2-1, April 6 ruling in the case, the 2nd U.S. Circuit Court of Appeals in New York held a lower court had not abused its discretion in certifying the shareholder class. Plaintiffs had alleged that shareholders relied on New York-based Goldman’s material misstatements in choosing to purchase a hedge fund’s stock at the market price.
The case had to do with several collateralized obligation transactions involving subprime mortgages.
In 2010, in an agreement referred to in the New York ruling, Goldman agreed to pay $550 million to regulators to settle U.S. Securities and Exchange Commission charges over how it marketed the subprime mortgage products.
Goldman Sachs said in a statement, “We’re pleased the Supreme Court has decided to hear our appeal.”
A plaintiff attorney in the case did not respond to a request for comment.
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