Earlier this year Morgan Stanley agreed to pay $95 million to end a putative class action in New York federal court alleging it misled institutional investors about shoddy mortgage-backed securities.
The settlement, reached with a group of pension funds led by the Public Employees’ Retirement System of Mississippi and the West Virginia Investment Management Board, ends a consolidated suit accusing the bank of making materially false and misleading statements about the mortgage pools underpinning MBS certificates it had sold to the plaintiffs.
Under the terms of the deal, the bank will pay $95 million to a class of buyers of certain 2006- and 2007-issued MBSs, without admitting to any liability or wrongdoing. Attorneys fees and expenses will be included in this figure.
The plaintiffs and their counsel have urged U.S. District Judge Katherine B. Forrest to approve the settlement saying that after five years of “hard-fought” litigation, they were now “fully informed about the strengths and weaknesses” of the case.
The hearing for final approval of the settlement is scheduled for December 18, 2014.
Categories: Class Actions of Interest