S&P CDO & CPDO Ratings Class Action
On 7 August 2020, Banton Group filed a class action on behalf of investors in products rated by S&P. Following an interlocutory hearing on 25 July 2023, the Court has granted leave for the claim to be amended.
The class action concerns collateralised debt obligations (CDOs) and constant proportion debt obligations (CPDOs) assigned a credit rating of ‘AAA’, ‘AA+’, ‘AA’ or ‘AA-‘.
The class action is funded by Litigation Capital Partners LLP PTE Ltd (LCP). No class member will be out of pocket for the costs of the class action.
Following the hearing on 25 July 2023 the Court extended the deadline for group members to register for mediation by 4:00PM 17 November 2023. This is the second extension granted from the original deadline of 31 July 2022.
Class members have until 4:00PM AEST on 17 November 2023 to register or opt-out.
If you do nothing, you risk losing your right to compensation from this class action.
Am I a Class Member?
The relevant CDOs and CPDOs (together Products) were rated ‘AAA’, ‘AA+’, ‘AA’ or ‘AA-‘ by S&P in and around the period 2005 to 2007. Thousands of CDOs and CPDOs have been listed as being possibly relevant. There are a variety of different types of CDOs, including CDOs known as “collateralised loan obligations”.
You may be an eligible class member if you acquired an interest in such a Product, even if you acquired it after 2007. How you acquired the interest does not necessarily prevent you from being a class member: this includes buying interests in the Product in the initial issue or in a re-sale on a secondary market, or any other acquisition.
Note that you may be a class member even if you acquired your interest in a Product on a secondary market and after the 2005 to 2007 period.
If you are uncertain whether you are a class member, you can register anyway and Banton Group will be in touch to discuss your status. Alternatively, you can contact Banton Group by email to sandpcdos@bantongroup.com or read the Amended Group Member Notice.
Claim Overview
Banton Group acts on behalf of investors in a class action against S&P Global, Inc and Standard & Poor’s International, LLC (S&P). The class action relates to some of the Products assigned a credit rating of ‘AA’ or higher by S&P around 2005 to 2007. Those who acquired interests, whether on a primary or secondary market, in these Products during or after this period may be entitled to claim in the class action.
It is alleged that:
- S&P assigned credit ratings to the Products when it was aware of serious flaws in its ratings model, and
- S&P falsely represented to the public that its process for rating the Products was objective, independent and uninfluenced by any conflicts of interest that might compromise S&P’s analytical judgment.
For more information about the allegations made in the claim, you can read the Plaintiffs’ Further Amended Originating Application and Further Amended Statement of Claim.
Funded Class Member
The class action is funded by Litigation Capital Partners LLP PTE Ltd (LCP).
This means that class members are not, and will not, be liable for any “out of pocket” legal costs by remaining in the class action. The costs of running the action to a trial of the common issues are being paid by LCP.
If the class action is not successful, class members will have no liability. However, if money is successfully recovered, Funded Class Members agree to pay LCP an amount for litigation funding costs and for commission out of any money they get.
While Registered Unfunded Class Members are not currently obliged to pay LCP, they may still have to contribute out of the money they received if the Court makes an order to that effect at a later date.
If you are interested in becoming a Funded Class Member, you should read LCP’s Standard Funding Agreement. If you have any concerns or questions, you can obtain independent legal advice from your own solicitor, or ask Banton Group.
Further, if you do participate as a Funded Class Member, and are interested, you may wish to retain Banton Group as your solicitors by entering into a Retainer & Costs Agreement with Banton Group. You may request a copy of our Retainer & Costs Agreement by emailing sandpcdos@bantongroup.com.
Class Member Registration / Opt Out
Registration is not compulsory, but failing to register risks losing your right to compensation from this class action.
However, if the class action settles, the Court may make orders which mean that group members who did not register by 4:00PM AEST, 17 November 2023 will not be permitted to participate in any settlement prior to the commencement of the trial of the common issues, without leave of the Court.
If you register:
- Banton Group can confirm whether you are a Class Member and will contact you if you become eligible to receive compensation. This may happen if the class action settles, or if the court makes a judgment in favour of the Claimants.
- Alternatively, if you do not register and favourable judgment is entered or successful settlement occurs, Banton Group will not know of your claim and will not be able to contact you.
- There is no cost to register.
For your claim to be considered at mediation, the Court will order your name, your address and the details of your investments in any Product to be provided to S&P. This information will be kept confidential by the lead applicants, S&P, and the Court, and will only be used for the purposes of the class action and will not be shared with the public. S&P have provided an undertaking that they will not contact you in relation to the class action without the Court’s approval. Further information can be found in the Group Extension of Time and Confidentiality Notice.
If you are interested in registering your claim, please click here to be directed to the Class Member Registration Page.
Alternatively, you may wish to opt out. Class members who opt out will not be bound by the outcome of the class action, and will not receive any money from the class action if it wins or settles. However, a class member who opts out may be able to bring their own proceeding against S&P, but should be conscious that they will need to verify that their claim is not time barred due to limitation, and that they will need to arrange funding of the legal costs of bringing such a claim.
If you would like to opt out, please complete the opt out notice attached to the Amended Group Mediation and Opt Out Notice and send it to the Federal Court of Australia Registry in New South Wales.
