Judge To Hear Protest Of Bear Stearns Consolidation

Judge To Hear Protest Of Bear Stearns Consolidation - 1/26/2009

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Judge To Hear Protest Of Bear Stearns Consolidation
Erin Fuchs

Securities Law 360. January 26, 2009
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EXCERPT: The judge heading the multidistrict securities litigation against Bear Stearns Cos. Inc. will hear a motion next month from a class of current and former employees fighting the consolidation of their cases with other securities actions against the investment giant. On Thursday, in the U.S. District Court for the Southern District of New York, Judge Robert W. Sweet ordered that he would hear the motion of class representative Gilles Bransbourg on Feb. 18 without oral argument. That motion, filed last week, objected to the judge's consolidation of the Bransbourg case with other security suits. The motion also objected to his appointment of the State of Michigan Retirement Systems as the lead plaintiff representing the Bransbourg class, saying lead plaintiff Michigan couldn't represent the employees and former employees' interests since the state didn't participate in the bank's equity plans. Daniel Krasner of Wolf Haldenstein Adler Freeman & Herz LLP, which represents Bransbourg, said it is typical for the Southern District not to hear motions such as these with oral arguments. “They do not hear oral argument on motions to reconsider,” he said. The Michigan Attorney General's Office, which made the bid to consolidate the cases, didn't immediately return a call for comment Monday on the judge's order. The class actions consolidated by the judge claim the company and five executives and directors misled investors about the investment bank's exposure to subprime mortgage-backed securities. The motion that Judge Sweet will hear next month alleges that his appointment of Michigan as lead plaintiff “ignores the clear mandate of the Private Securities Litigation Reform Act of 1995” that lead plaintiffs be representative of the class as a whole.

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