Goldman Must Face $1B NY State Suit Over CDO Sales (Jury trial this year) [View all]

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Source: Law 360

Law360, New York (January 30, 2014, 7:00 PM ET) -- A New York state appeals court on Thursday unanimously upheld a New York state judge's 2012 decision to largely preserve a $1 billion suit over collateralized debt obligation-related securities Goldman Sachs Group Inc. sold to a client in 2007 before allegedly betting against them.

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Read more: http://www.law360.com/articles/505591/goldman-must-face-1b-ny-state-suit-over-cdo-sales

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This is the one where they got caught with the most toxic of toxic CDOs

In a case launched in 2010, Basis Yield Alpha Fund is claiming the Wall Street giant engaged in fraud when it sold sub-prime securities it knew were junk in 2007, and then bet against the assets when the global financial crisis hit.

‘‘We welcome the appellate court’s 5-0 decision and we look forward to putting our fraud claim to a jury once discovery has been completed later this year,’’ Basis managing director Nick Reeves said.

At the centre of the case are two collateralised debt obligations (CDOs) sold by Goldman, known as Timberwolf and Point Pleasant. …

This is the one where they got caught with the most toxic of toxic CDOs. It’s clear that internally they knew exactly what they were selling. They constructed these to fail and fail quickly ( Thelawyer representing Basis, Lewis Baach partner Eric Lewis said

http://www.smh.com.au/business/court-dismisses-goldman-sachs-hedge-fund-appeal-20140131-31rtc.html