Oregon opts out of class, sues Countrywide
SALEM, Ore. (Legal Newsline) - Oregon Attorney General John Kroger announced on Wednesday that he is suing Countrywide Financial Corp. over alleged false statements it filed to inflate the company's assets.
Kroger's suit is seeking to recover losses to the state pension and workers' compensation funds caused by alleged misinformation that inflated the prices of the Countrywide's stock and bonds.
"Oregon will not accept pennies on the dollar when Wall Street defrauds Oregonians," Kroger said.
Oregon Treasurer Ted Wheeler, who sits on the Oregon Investment Council and has a fiduciary duty to protect public assets and maximize the returns for beneficiaries of trust funds including the Oregon Public Employees Retirement Fund, joined Kroger in the announcement.
"It is time to foreclose on Countrywide's effort to pay so little for costing Oregonians so much," Wheeler said.
A separate class action suit against Countrywide reached a settlement that would have seen the state net less than $500,000 of its $14 million in losses, Kroger says. In response, Kroger and Wheeler decided to file a separate lawsuit and opt out of the class action suit.
In 2005, Countrywide originated over $490 billion in mortgage loans and was considered a leader among the nation's largest mortgage lenders.
From 2004 until March 2008, the office of state treasurer and the Oregon Investment Council purchased and sold shares in Countrywide stock and bonds on behalf of Oregon Public Employees Retirement Fund and the Industrial Accident Fund, the SAIF workers' compensation investment fund.
"It is important that we protect the interests of SAIF's policyholders and injured workers," Brenda Rocklin, SAIF Corporation president and CEO, said.