Skadden helps SocGen fight off US subprime class action

Skadden Arps Slate Meagher & Flom has successfully defended Société Générale (SocGen) in a class action that alleged the bank violated US securities law and misled investors over its exposure to subprime mortgages.

The consolidated securities class action was brought against the bank and several executives, including former chairman and chief executive officer Daniel Bouton.

On 29 September, after almost three years of ­proceedings, the US District Court for the Southern District of New York upheld SocGen’s motion to dismiss, rejecting the class action as inadmissible.

Plaintiffs the Vermont Pension Investment Committee, the Boilermaker-Blacksmith National Pension Fund and the United Food and Commercial Workers Union joint pension fund were represented by Robbins Geller Rudman & Dowd partner Theodore Pintar.

The court ruled that the plaintiffs had failed to establish the bank had knowingly made false or misleading statements, and that insider trading allegations had not been substantiated.

It cited the decision by the US Supreme Court in Morrison v National Australia Bank, which ruled that investors who purchase shares in non-US companies listed on non-US exchanges could not bring action in the US to seek compensation under federal securities law.

The Skadden team included lead partner Pierre Servan-Schreiber in Paris assisted by Coline Vuillermet, Sidne Koenigsberg and Olivier Boulon, and New York partner Scott Musoff supported by Bryan Levine.