ING Successfully Opposes Class Certification in Securities Act Case
July 10, 2012
Cleary Gottlieb successfully opposed class certification on behalf of ING Groep, its directors, and several affiliates in a ruling issued on July 10 by Judge Lewis Kaplan of the U.S. District Court for the Southern District of New York. Plaintiffs brought Securities Act claims against ING and others alleging that the offering materials for three perpetual capital hybrid securities offerings issued by ING in 2007 and 2008, raising, in the aggregate, $4.5 billion, contained material misstatements and omissions concerning ING’s mortgage-backed securities holdings. In a previous ruling, Judge Kaplan granted a motion to dismiss all claims based upon two of those offerings.
On July 10, Judge Kaplan denied plaintiffs’ motion to certify a class of purchasers of the third offering, holding that the proposed class representative, Belmont Holdings, could not so serve. Belmont, a company affiliated with Raymond Perelman, purchased $10 million of ING hybrid securities issued in the third offering but then sold them for their purchase price to a separate company that, while affiliated with Perelman, had different owners. Because Belmont received the full value of what it paid for the securities, Judge Kaplan ruled, it had no damages and therefore could not serve as class representative. As a result, no class could be certified.