Class Action

Class Action Defense Cases—In re Citigroup Securities Litigation: Judicial Panel On Multidistrict Litigation (MDL) Grants Defense Motion To Centralize Class Action Litigation In Southern District Of New York

By Michael J. Hassen

Judicial Panel Grants Defense Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407, Opposed by California Class Action Plaintiffs, and Transfers Class Actions to Southern District of New York

Ten class actions – nine in New York and one in California – were filed against various Citigroup entities alleging securities laws violations “by misleading investors about the nature of Citigroup’s investments and the company’s financial condition.” In re Citigroup Inc. Securities Litig., ___ F.Supp.2d ___ (Jud.Pan.Mult.Lit. August 7, 2009) [Slip Opn., at 1]. Specifically, the class action complaints alleged that the Citigroup defendants made “material misstatements or omissions in Citigroup’s disclosures about the company’s holdings in and exposures to subprime-related assets.” Id., at 2. Defense attorneys filed a motion with the Judicial Panel for Multidistrict Litigation (MDL) requesting centralization of the class actions pursuant to 28 U.S.C. § 1407 in the Southern District of New York; attorneys for the California class action plaintiffs opposed the motion. Id., at 1. The Judicial Panel granted the motion to centralize the class action lawsuits and agreed that the Southern District of New York was the appropriate transferee court because Citigroup is headquartered in that federal district and because nine of the ten class actions “are already pending in the Southern District of New York before one judge who is also presiding over related derivative and ERISA litigation.” Id., at 2. Accordingly, the Panel ordered the California class action transferred to the Southern District of New York, id.

Full post as published by Class Action Defense Blog on September 11, 2009 (boomark / email).