San Mateo County can pursue its legal claims against Lehman Brothers’ officers, directors and auditor, a district court judge ruled this week in an opinion that reinvigorates the battle to recoup some of the $155 million lost when the Wall Street firm went bankrupt.
The ruling by U.S. District Court Judge Lewis Kaplan allows the county, six other public entities and an insurance company to go forward with a core set of claims against former executives including former CEO Richard Fuld and auditor Ernst and Young LLP for securities violations and accounting fraud. The court order also leaves Fuld facing allegations he fraudulently transferred his $14 million Florida home to his wife for $100 in 2008.
The plaintiffs in this case are the only ones in the country that argued Lehman was “up to its shenanigans far before what everyone assumed they were,” Edlin said.
San Mateo County has led the legal charge against Lehman, filing the first suit aimed directly at individuals rather than seeking compensation through bankruptcy proceedings.
San Mateo County took the largest fall of city investors in the Lehman brothers crash, I'll be interested in watching this. Does anyone else think this is a BFD with historical implications?