Kaplan Fox & Kilsheimer LLP announces a $170 million settlement of a class action lawsuit against Fannie Mae and certain current and former officers and directors for violations of federal securities laws. Kaplan Fox represented the Tennessee Consolidated Retirement System in the Action.
The proposed settlement is subject to the approval of the Honorable Paul A. Crotty in the United States District Court for the Southern District of New York, where the class action is pending under the caption In re Fannie Mae 2008 Securities Litigation, 08-CV-07831 (PAC).
The class action was initially filed in 2008. The suit alleged that Fannie Mae and certain current and former officers and directors violated federal securities laws, including Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, by making materially false and misleading statements and failing to disclose material information. Specifically, Defendants were alleged to have publicly issued materially false and misleading statements and failed to disclose material information concerning (1) Fannie Mae’s risk controls relating to its purchases of certain types of securities, including subprime and Alt-A loans, and (2) Fannie Mae’s exposure to subprime and Alt-A loans. When these facts were revealed in a series of disclosures beginning in February 2008, Fannie Mae’s stock prices plummeted.
Kaplan Fox attorneys working on this matter are: Frederic S. Fox, Donald R. Hall, Hae Sung Nam, Melinda D. Campbell, Jeffrey P. Campisi and Damien H. Weinstein.