(Adds details on case, paragraphs 3-8)
By Lawrence Hurley
WASHINGTON Jan 13 The U.S. Supreme Court on
Friday agreed to resolve a legal dispute over whether certain
securities class action lawsuits can be barred because they were
filed too late.
The justices agreed to hear an appeal filed by the
California Public Employees' Retirement System seeking to revive
a lawsuit against various financial institutions over their
alleged role in the collapse of Lehman Brothers.
The retirement system, known as Calpers, was part of
extensive litigation against Lehman and its former directors
following the bank's 2008 collapse, which contributed to that
year's global financial crisis.
Investors said underwriters helped perpetuate misstatements
about Lehman's finances leading up to its historic downfall.
Calpers opted out of a $417 million settlement reached in 2011
between investors and multiple defendants, including Bank of
America Corp and Morgan Stanley, preferring to pursue its own
In a July 2016 ruling, the New York-based 2nd U.S. Circuit
Court of Appeals upheld a district judge's decision to dismiss
The legal fight is over whether Calpers waited too long
after the bank's collapse to sue or whether the three-year
window for suing was put on hold because of the other related
lawsuits that had been filed prior to the settlement.
Lower courts are split on the question of whether the window
for filing certain securities claims is suspended if investors
can show they would have been parties in a previously filed
class action lawsuit had it not been dismissed
The legal issue was presented to the court in a 2014 case it
agreed to hear concerning claims against underwriters of
securities issued by a unit of the now-defunct IndyMac Bancorp
Inc under the Securities Act. The court never decided the case
because the parties settled, meaning it was dismissed before a
ruling was issued.
(Reporting by Lawrence Hurley; Editing by Will Dunham)