Published March 18, 2013
| Dow Jones Newswires
The U.S. Supreme Court on Monday refused to consider an appeal by subsidiaries of Goldman Sachs Group Inc. (GS) that sought to derail a class-action lawsuit alleging the company provided false and misleading information about mortgage-backed securities it underwrote and issued.
Institutional investor NECA-IBEW Health & Welfare Fund alleged Goldman Sachs' investment materials for 17 offerings of mortgage-backed certificates provided a variety of misleading information, including on the practices of mortgage lenders and the appraisals of the properties backing the securities.
Goldman Sachs argued that NECA didn't have the right to bring legal claims on all 17 offerings because it made an investment in only two of them.
Last year, the New York-based Second U.S. Circuit Court of Appeals ruled that NECA had legal standing to bring a class action against Goldman Sachs on several of the other 15 offerings even though it didn't invest in them.
The appeals court noted that several of the Goldman Sachs' offerings had attributes common to the ones NECA purchased.
The Supreme Court, in a short written order, let that ruling stand and rejected Goldman Sachs' appeal without comment.