$295M settlement reached in state’s potential class action against Bear Stearns

In what Attorney General Bill Schuette is calling “good news for Michigan taxpayers,” a national class-action securities fraud lawsuit against Bear Stearns and Deloitte & Touche has been settled for $295 million.

Hon. Robert Sweet, U.S. District Judge for the Southern District of New York, granted preliminary approval to the proposed suit, in which Michigan was court-appointed lead plaintiff.

As part of the deal, the defendants will pay investors nationwide — including State of Michigan Retirement Systems (SMRS) — after being misled about the value and risks of Bear Stearns’ mortgage-backed assets.

The amount SMRS will receive as part of the settlement will be finalized Sept. 19.

In a statement, Schuette called the settlement “good news for Michigan taxpayers. … [This] demonstrates our commitment to holding accountable any bank or investment firm that violates the public trust.”

Michigan contended that Bear Stearns and auditor Deloitte & Touche misled the state’s pension fund and other investors about risky exposure to the U.S. housing market and subsequent write-downs to its assets, which led to Bear Stearns and its stock collapsing.

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MSC denies AG request in U of M grad student union case

The Michigan Supreme Court has denied to hear a request from Michigan Attorney General Bill Schuette to stop a hearing to determine if graduate assistants at the University of Michigan can unionize.

According to the order, released this afternoon, MCL 24.301 only allows interlocutory appeals in contested cases. Chief Justice Robert P. Young noted that “While the proposed intervenors [Schuette and a group opposed to the research assistants organizing] present nonfrivolous arguments rejecting that claim, the Court of Appeals does  not have jurisdiction in this particular matter … .”

Justice Stephen J. Markman concurred even though he said he shares the “unsuccessful intervenors’ concerns regarding the manifest unfairness of the fact-finding hearing now underway before the administrative law judge as a result of [Michigan Employment Relations Commission]’s denial of the two motions to intervene … . ”

He said that because the university and the Graduate Student Research Assistants agree that the assistants are public employees, “there is no party to represent the alternative legal position that GSRAs do not constitute ‘public employees’ under [Public Employee Relations Act].”

MERC denied a motion to intervene, stating: “We must carry out our statutory responsibility … without interference from non-parties opposed to the very rights provided to public employees by PERA.”

However, Markman wrote that “It would seem that in carrying out its statutory responsibility, MERC might have viewed it as helpful, rather than as a matter of ‘interference,’ that it be presented with arguments on both sides of an issue under consideration.”

Schuette subpoenas 3 mortgage processors over questionable documentation

The Michigan attorney general’s office has subpoenaed three mortgage processors as part of a state investigation of “robo-signing.”

Attorney General Bill Schuette said his office serviced Lender Processing, Fidelity National Financial Inc. and CT Corporation System with investigative subpoenas as affiliates of DocX, a mortgage service support provider. Schuette said he is seeking information about documents signed by DocX employees as “Linda Green.”

The subpoenas are part of a criminal investigation into questionable mortgage documentation filed with Michigan Register of Deeds offices, Schuette said in a statement. The subpoenas were approved June 13 by the state court in Lansing and require responses by June 30, Schuette said.

“Allegations of forged mortgage documents are very serious and require a thorough investigation,” Schuette said. “I will continue to work closely with federal and local authorities to find answers on behalf of Michigan homeowners.”

Schuette said he started the investigation in April after county officials across Michigan said they suspected assignment of mortgage documents filed in their offices may have been forged.

Source: Michigan Attorney General’s Office

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Federal judge speaks to Wayne grads; Stupak joins D.C. firm

Here’s a roundup of upcoming legal events and people of note:

• The Hon. Avern Cohn of the U.S. District Court for the Eastern District of Michigan will speak at Wayne State University Law School’s annual commencement ceremony.

Cohn also will receive an honorary doctor of laws degree at the ceremony, which takes place 5 p.m. May 16 at the Max M. Fisher Music Center in Detroit.

“I am deeply honored to join the past recipients of an honorary degree from the Law School, to wit: Eugene Driker, Dennis Archer, Maura D. Corrigan, Marilyn Kelly and Harold Koh,” Cohn said.

Admission to the commencement is by ticket only. For more information, contact the Law School’s Dean of Students Office at (313) 577-3997 or lawdso@wayne.edu.

• Former nine-term Congressman Bart Stupak, D-Michigan, who played a lead role in passage of the landmark health care legislation of 2010, has joined Venable LLP as a Legislative and Government Affairs partner in the firm’s Washington office.

Stupak was a senior member of the House Energy and Commerce Committee and Chairman of its subcommittee on Oversight and Investigations.

A former police officer and Michigan state trooper, Stupak became one of the leading congressional voices on law enforcement issues: in 1994 he created the first law enforcement caucus in Congress and went on to help write and pass substantial legislation to support law enforcement professionals.

Stupak also is serving as a Fellow at Harvard University’s Institute of Politics and will be leading a study group on government investigations at the Kennedy School of Government entitled “Investigate or Irritate: Changing Corporate and Government Behavior.”

• A ribbon-cutting ceremony to open the Crime Victims Rights Exhibit at the Michigan Supreme Court Learning Center in Lansing is this coming Wednesday, April 13, at 3 p.m.

Chief Justice Robert P. Young Jr., Sen. Tonya Schuitmaker, former state legislator Senator Bill Van Regenmorter (author and proponent of Michigan’s Crime Victims Rights Act), and Attorney General Bill Schuette are scheduled to speak.

The Prosecuting Attorneys Association of Michigan is co-sponsoring the event.

The educational exhibit is a tribute to crime victims and those who advocate for them. It will feature four panels, the exhibit educates the viewer about the act, and its meaning for crime victims, through interactive educational games.

• Know a great young attorney who has made great strides in his or her career? Then the Young Lawyers Section of the State Bar of Michigan wants to know more.

The section is now accepting nominations for the 2011 Regeana Myrick Outstanding Young Lawyer Award.

All nominations must be received by May 6. The recipient of the award will be chosen by the SBM-YLS Outstanding Young Lawyer Award Subcommittee, and will notified by May 13. The award will be presented during the Fourth Annual YLS Summit on Saturday, May 21, at the Amway Grand Plaza Hotel in Grand Rapids.

In 1997, the Young Lawyers Section renamed its Outstanding Young Lawyer Award in honor of Regeana Myrick, an executive council member of the section who passed away in August of that year.

For more information, contact Brandy Y. Robinson at byrobinson@gmail.com.

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