CalPERS drops suit against Fitch Ratings
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The country’s largest public pension fund, the California Public Employees’ Retirement System, has dropped a lawsuit against Fitch Ratings without receiving any monetary settlement.
The 2009 lawsuit in San Francisco County Superior Court accused Fitch and two other rating firms, Moody’s Investors Service and Standard & Poor’s, of inflating the security rating of $1.3 billion in debt from three investment funds that were hit with large losses after the U.S. economy began to collapse in 2007.
CalPERS, however, said it is moving forward with the suit against Moody’s and Standard & Poor’s.
‘Dismissal of the two Fitch defendants in the CalPERS complaint will streamline the litigation against two other credit rating agencies,’ CalPERS said. ‘CalPERS can still fully recover its damages if it prevails against Moody’s or S&P, which will not be able to avoid liability through the Fitch dismissals.’
In a statement, Fitch said it ‘is pleased with the resolution of this case and the disposition reached with CalPERS,’ according to the Reuters news agency.
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-- Marc Lifsher
Photo: CalPERS headquarters atrium. Credit: Rich Petrocelli / Associated Press