NEW YORK (Reuters) - Goldman Sachs Group Inc <GS.N> and TCW Asset Management Co won dismissal on Wednesday of a lawsuit by German state-owned Landesbank Baden-Wurttemberg over a derivative product that lost money during the credit crisis.
U.S. District Judge William Pauley in New York granted the joint motion to dismiss and closed the case brought in October 2010 by LBBW seeking recovery of at least $37 million in losses for an investment in a collateralized debt obligation (CDO) named Davis Square Funding VI.
Continue Reading Below
Pauley's written ruling said the allegations against Goldman and TCW "are similarly sparse and lack particulars" in order to survive the requirements to charge a fraud and misrepresentation.
The CDO's underlying portfolio comprised about 95 percent residential mortgage-backed securities, which went on to lose value as the housing market crashed.
Landesbank accused Goldman of profiting unjustly from Davis Square by charging an excessively high purchase price and fees. It said Goldman also bet against the product by buying billions of dollars in credit default swaps that insured Goldman against the collapse of the mortgage securities collateral it sold to Landesbank.
The case is Landesbank Baden-Wurttemberg vs Goldman Sachs and TCW Asset Management Co, U.S. District Court, Southern District of New York No. 10-07549.
(Reporting by Grant McCool; editing by Andre Grenon)