On April 19, Lehman Brothers Special Financing (“LBSF”), a subsidiary of Lehman Brothers Holdings Inc. (“LBHI”), filed its opposition to a motion to dismiss its breach-of-contract claims related to the Pyxis transaction, one of many credit-default swap (“CDS”) transactions that were terminated as a result of LBHI’s bankruptcy. LBSF argued that the cancellation of its…

Earlier this month, California Attorney General Kamala Harris filed suit against Morgan Stanley in San Francisco Superior Court, alleging violations of the California False Claims Act and other state laws.  Brought on behalf of the California Public Employees Retirement System—the nation’s largest pension fund—and the California State Teachers Retirement System, the suit alleges that Morgan…

Royal Park Investments SA/NV (“Royal Park”), a Belgian investment fund, filed a class action on behalf of itself and similarly situated investors against Bank of New York Mellon Corporation (“BNYM”).  The complaint alleged that BNYM breached its obligations as a trustee of $1.12 billion in residential mortgage-backed securities (“RMBS”) when it failed to cure, substitute…

On February 23, the U.S. Court of Appeals for the Second Circuit vacated the district court’s dismissal of a fraud case brought by Simmtech Co. Ltd. — a Korean circuit board manufacturer — against Citigroup Inc. and certain of its affiliates.  Between 2006 and 2008, Simmtech purchased “knock in knock out” derivatives contracts (commonly known…

Last week, 11 Wall Street banks agreed to pay more than $63 million to settle claims brought against them by the Commonwealth under the Virginia Fraud Against Taxpayers Act. Brought by the Virginia attorney general, the suit originally sought $1.15 billion against the banks for alleged misrepresentation of the quality of residential mortgage-backed securities (“RMBS”)…