Goldman Thwarts Fraud Class Action Tied to Abacus CDO: U.S. Appeals Court

Reuters
January 12, 2018

Thomas A. Dubbs “confident” class will be certified in action against Goldman Sachs

The 2nd U.S. Circuit Court of Appeals in Manhattan recently said a lower court judge imposed too high a burden on Wall Street bank Goldman Sachs to show that its alleged conflicts of interest and misleading statements had no impact on its stock price.

Shareholders originally sued after news about federal enforcement activity hurt Goldman’s stock, including when the Securities and Exchange Commission brought civil fraud charges in April 2010 against Goldman and vice president Fabrice Tourre over Abacus.

While it may now be easier for Goldman to convince U.S. District Judge Paul Crotty, who had certified a class action in September 2015, not to let the plaintiffs sue as a group, Firm partner leading the case representing the shareholder, Thomas Dubbs, said he was “confident” a class action would again be certified.