August 8, 2011
New York's Retirement Fund Settles $168 Million Securities Suit Against National City Corporation
The New York State Common Retirement Fund (Fund) today announced a proposed $168 million settlement of its securities fraud class action lawsuit against National City Corporation (National City) related to investment losses.
“This is a good result for the Fund and the more than one million Fund members who rely on these investments,” said State Comptroller Thomas P. DiNapoli, trustee of the $147.2 billion Fund, and lead plaintiff in the class action. “And it sends a message that we will always fight to protect the best interests of our members.”
The Fund’s complaint alleged that National City misrepresented the quality of its mortgages and home equity loans and the severity of its losses to investors. The defendants made no admission of wrongdoing but agreed to the settlement, which is scheduled to go before U.S. District Judge Solomon Oliver, Jr. for preliminary approval in the next few weeks, after which all class members will be notified.
During the period in question, National City, which held more than $48 billion in residential real estate loans, was one of the largest financial holding companies in the United States. The complaint was filed in the United States District Court for the Northern District of Ohio in 2008.
The law firm of Kirby McInerney LLP represents the fund in this lawsuit.
The $147.2 billion New York State Common Retirement Fund exists to provide benefits to more than one million state and local government employees, retirees, and beneficiaries.
DiNapoli’s office announced the $4.25 million settlement of a securities fraud lawsuit against Merrill Lynch & Co. in January and negotiated a $624 million settlement in a class-action securities fraud suit against Countrywide Financial Corporation in 2010.