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Goldman Sachs Discloses 6 Shareholder Suits
Goldman's filing notes that the litigation by shareholders makes claims against the firm and its executives of "breach of fiduciary duty, corporate waste, abuse of control, mismanagement and unjust enrichment," and also challenges the accuracy and completeness of its past disclosures. The shareholders are seeking damages, restitution and corporate government reforms by the firm.
Lawsuits by shareholders have multiplied and shares of Goldman Sachs Group Inc. have plummeted since news on April 16 of the SEC's civil lawsuit against the firm and a trader, Fabrice Tourre. That was followed by a Senate hearing last Tuesday at which Goldman executives, including CEO Lloyd Blankfein, were grilled and publicly rebuked by indignant lawmakers. Then came word Thursday that the Justice Department had opened a criminal investigation of Goldman in connection with mortgage securities transactions it arranged in the run-up to the subprime mortgage meltdown in 2007.
The inquiry by federal prosecutors in Manhattan is in a preliminary state and it is far from certain that it will result in criminal charges being brought.
Goldman shares plunged 9 percent last Friday to $145.20. That was the day after the criminal inquiry became known, and following Standard & Poor's analysts' downgrade to "Sell" from "Hold" and reduction of their target price for Goldman by $40, to $140.
The stock recovered in trading Monday, finishing at $149.50 – still far below the $184...
