NEW YORK (Reuters)—A Manhattan federal judge said on Tuesday that it was unfair to hold Moody's Investors Service and Standard & Poor's Corp. liable as "underwriters" on securities offerings needing their ratings as he rejected fraud claims by investors on the safety of $63.4 billion of mortgage debt.

U.S. District Judge Jed Rakoff issued an opinion detailing reasons behind his March 31 dismissal of class-action claims against the credit rating agencies, and some claims against Bank of America Corp., JPMorgan Chase & Co. and the ABN Amro unit of Royal Bank of Scotland Group P.L.C.

He also dismissed the case against Credit-Based Asset Servicing & Securitization L.L.C., or C-Bass, which packaged debt underwritten by the banks.

Plaintiffs led by the Public Employees' Retirement System of Mississippi had accused rating agencies and banks of misleading them about the safety of 84 mostly investment-grade offerings of residential mortgage-backed securities.

Judge Rakoff rejected the plaintiffs' contention that the agencies should be treated effectively as underwriters because their ratings were "necessary" to distribute the securities.

"There is nothing in the complaint to suggest that the ratings agencies participated in the relevant 'undertaking'—that of purchasing the securities...from the issuer with a view to their resale," he wrote.

Moody's is a unit of Moody's Corp., and S&P is a unit of McGraw-Hill Cos.

Judge Rakoff issued his ruling a day before six current and former Moody's officials, including CEO Raymond McDaniel, testify before the Financial Crisis Inquiry Commission, which is examining causes of the 2008 crisis.

The commission on Wednesday will examine credit ratings and how investors use them. Moody's and S&P have been widely criticized for fueling the crisis by assigning high ratings for too long and then downgrading them too fast. Many subprime and other risky securities lost all or much of their value.

The case is Public Employees' Retirement System of Mississippi et al vs. Merrill Lynch & Co. et al, U.S. District Court, Southern District of New York, No. 08-10841.