Subprime Mortgage Litigation Group Launched

December 10, 2007 No Comments »

New York-based law firm Bernstein Litowitz Berger & Grossmann LLP announced that it has formed a new team to deal specifically with cases arising from the subprime mortgage crisis.

“Our Subprime Litigation Practice Group will help ensure that the rights of institutional and individual investors, as well as consumers, are fully protected and will advise clients on potential claims against all participants, including lenders, investment banks and ratings agencies,” Gerald Silk, a Bernstein Litowitz partner, said in a statement on Monday.

Law firms typically form specialized groups on hot subjects to attract the expected influx of potential clients.

The firm said the group will include Gerald Silk, partner Salvatore Graziano, and attorneys Avi Josefson, Mark Lebovitch and Noam Mandel, along with a handful of other lawyers who are working on subprime-related cases.

Recently, Litowitz filed a lawsuit on behalf of institutional investors, suing Countrywide chief executive Angelo Mozilo for allegedly engaging in hundreds of millions of dollars worth of improper, insider stock sales.

Mozilo sold roughly $130 million in Countrywide stock in the first half of the year through a prearranged 10b5-1 trading plan, a deal which allowed him to significantly accelerate the sale of his company’s shares.

It is widely expected that a large number of subprime-related cases will surface in the next several years as mortgage lenders stumble and record losses continue to be announced.

Litowitz was also behind the $6 billion WorldCom securities fraud litigation settlement, as well as the options backdating case against former UnitedHealth Group Inc.

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