McGraw names alleged conspirators in bid-rigging lawsuit
NEW YORK (Legal Newsline) - West Virginia Attorney General Darrell McGraw filed an amended complaint in a bid-rigging lawsuit against Bank of America Tuesday, adding 24 new defendants.
Among those added are UBS AG, JP Morgan Chase and AIG. McGraw's original complaint, transferred in February from state court to a multidistrict litigation court in New York, alleged Bank of America and unnamed conspirators manipulated the municipal bond market.
"Whether it involves the sale of two-by-fours or sophisticated financial products, bid rigging will not be tolerated in West Virginia," McGraw said.
Financial institutions added are UBS AG and subsidiaries UBS Financial Services and UBS Securities; JP Morgan Chase and subsidiary JP Morgan Securities; MBIA; Morgan Stanley; Rabobank Group; Bayerische Landesbank Girozentrale; Transamerica Occidental Life Insurance; AIG Financial Products; AIG Matched Funding; Financial Security Assurance; Assured Guaranty US Holdings; Dexia; GE Funding Capital Market Services; Natixis Funding; Royal Bank of Canada; and Financial Guarantee Insurance.
McGraw also added three brokers. They are CDR Financial Products, George K. Baum & Co. and Investment Management Advisory Group.
McGraw says the conspiracy affected the sale of financial contracts by state agencies and local municipalities that were paid for with the proceeds of bond sales.
McGraw says the state did not receive substantial interest payments because bid rigging allowed companies to sell their financial products to state agencies at lower rates of interest than normal.
McGraw fought the transfer of his suit to the MDL, arguing that it should not be transferred because the suit named only one defendant and dealt only with issues of state law. The panel said there were other at least three similar suits in the MDL.
McGraw hired his brother's nephew to represent the state.
Cook Hall & Lampros of Atlanta is one of three firms representing the state, along with Charleston's Berthold Tiano & O'Dell and DiTrapano Barrett & DiPiero. All three firms have contributed to McGraw's election campaigns.
Edward Shuff Cook is the nephew by marriage of former state Supreme Court Justice Warren McGraw, Darrell's brother. His bio says he has been appointed a special assistant attorney general in several states.
McGraw hired Cook, then at Provost Umphrey, in 2001 for a case involving law firm Steptoe & Johnson.
Employees of the Cook firm and their spouses have donated $20,000 to McGraw since 2004.
Also, the Berthold firm has donated $4,240 since 2004 and the DiTrapano firm, a frequent selection by McGraw to represent the state, donated at least $30,000 in 2004 and $5,050 in 2008.
From Legal Newsline: Reach John O'Brien by e-mail at email@example.com.
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