WASHINGTON (Legal Newsline) - Both sides in a class action securities lawsuit filed against mortgage giant Fannie Mae are reportedly arguing for summary judgment.
The Blog of Legal Times reported Tuesday that both the plaintiffs -- the Ohio Public Employees Retirement System, the State Teachers Retirement System and nearly 29 million other investors from all 50 states who have allegedly been defrauded by the company -- and the defendants -- Fannie Mae; its three most senior officers, Franklin Raines, Tim Howard and Leanne Spencer; and its accountant, KMPG -- have moved for summary judgment.
The plaintiffs have moved for summary judgment on Fannie Mae's liability for the losses suffered by those who bought stock in the company between 2001 and 2004, according to BLT. The defendants, meanwhile, have moved for summary judgment on just those claims related to their accounting practices.
Tuesday was the first of three days of oral arguments on the two sides' motions.
The Ohio Attorney General's Office initially filed the lawsuit in 2004. Jim Petro was the state's top lawyer at the time.
Now, Attorney General Mike DeWine, along with the Cincinnati law firm of Waite Schneider Bayless and Chesley, are representing the plaintiffs.
Although attorney Stanley Chesley -- known for winning billions of dollars for his clients in other mass torts and whose disbarment was recommended by the Kentucky Bar Association's Board of Governors last June -- has been taken off the case, his firm remains lead counsel.
The class action accuses Fannie Mae of misleading investors, in particular Ohio's two largest pensions.
The case is currently before Judge Richard J. Leon of the U.S. District Court for the District of Columbia.
Scott Fink of law firm Gibson Dunn and Crutcher, who argued for Fannie Mae, said Tuesday if the defendants win summary judgment on the accounting claims, it would be a "case ender," BLT reported.
In his arguments before Leon Tuesday, W.B. "Bill" Markowitz of Waite Schneider Bayless and Chesley noted that the plaintiffs' motion was "unusual."
However, in pointing to evidence showing the mortgage company had already admitted to the alleged fraud in filings with the U.S. Securities and Exchange Commission and other public statements, Markowitz said it was fitting.
From Legal Newsline: Reach Jessica Karmasek by email at firstname.lastname@example.org.