BOSTON, Oct. 24, 2014 (GLOBE NEWSWIRE) -- The Boston Retirement System announced today a $170 million proposed settlement with the Federal National Mortgage Association (Fannie Mae) in the securities class action In re Fannie Mae 2008 Securities Litigation, 08-CV-7831 (S.D.N.Y.). Boston Retirement System is one of two court-appointed lead plaintiffs for a proposed common shareholder class, along with the Massachusetts Pension Reserves Investment Management, and the Tennessee Consolidated Retirement System is the court-appointed lead plaintiff for a proposed preferred shareholder class. The proposed settlement, subject to court approval, will benefit thousands of class members.
Boston Retirement System Chairman Daniel J. Greene, Esq. said, "We're extremely pleased with the results, particularly in light of the dismissal of a similar lawsuit against Fannie Mae's sibling company, Freddie Mac, which was recently affirmed by a federal appellate court. Unlike the plaintiffs in the Freddie Mac case, we were able to successfully allege that investors' losses were caused by Fannie Mae's statements and actions rather than by the financial crisis."
Represented by Labaton Sucharow LLP attorneys Thomas A. Dubbs, Louis Gottlieb, and Thomas G. Hoffman, Jr., Boston Retirement System asserted securities fraud claims against Fannie Mae and two of its former officers on behalf of investors in Fannie Mae during the class period of November 8, 2006 to September 5, 2008. Specifically, the Boston Retirement System alleged that the defendants violated the Securities Exchange Act of 1934 by making false and misleading statements concerning the company's internal controls and its exposure to subprime and other risky mortgage loan products.Thomas Dubbs, the lead partner on the case, noted the "risks were indeed substantial, and knowing the outcome in the Freddie Mac case makes this recovery even more significant to us. We're very happy with the result achieved for the class."
Boston Retirement System further alleged that Fannie Mae's true exposure to these risky assets was revealed in a series of partial disclosures that culminated in the September 7, 2008 announcement by the company's regulator, the Federal Housing and Finance Agency (FHFA), that it had placed the company into conservatorship.
"The Boston Retirement System believes it's important to prosecute securities class action cases such as this one in order to protect the assets that it holds for its members and retirees," said Chairman Greene.
About Boston Retirement System
The Boston Retirement Board (Board) is the fiduciary for the Boston Retirement System, a governmental defined benefit plan created by virtue of the City of Boston accepting the enactment of Massachusetts General Laws Chapter 32, which governs Massachusetts' public pensions. The Board serves members, retirees, and beneficiaries of all City of Boston departments, as well as the Boston Redevelopment Authority, Boston Housing Authority, Public Health Commission, and Boston Water & Sewer Commission.
About Labaton Sucharow LLP
Labaton Sucharow prosecutes precedent-setting securities class actions, recovering billions of dollars on behalf of defrauded investors. The Firm represents some of the largest institutional investors worldwide with collective assets under management of more than $2 trillion. With nearly 60 full-time attorneys, Labaton Sucharow's litigation group is strengthened by its in-house team of investigators, financial analysts, and forensic accountants. The Firm's complex litigation services also include antitrust and competition, M&A and derivative litigation, and whistleblower representation. For more information, visit www.labaton.com.
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