Freidus v. ING Groep N.V.

S.D.N.Y. Grants Motion for Reconsideration Under a New Materiality Standard Laid Out by the Second Circuit in Litwin, but Returns the Same Result

Freidus v. ING Groep N.V., No. 09 Civ. 1049 (S.D.N.Y. Mar. 29, 2011) (Kaplan, J.)

Following the court’s partial grant and partial denial of defendants’ motion to dismiss Section 11, 12, and 15 claims under the ’33 Act, plaintiffs moved for reconsideration of that ruling, arguing that Litwin v. Blackstone Group, L.P., No. 08-cv-03601, 2011 WL 447050 (2d Cir. Feb. 10, 2011) changed the standard of materiality and therefore a different result was warranted in this case. The court had originally dismissed plaintiffs’ claims against ING on the basis that there were no allegations showing that defendants’ disclosures concerning the quality of the Alt-A and RMBS securities at issue were false. The court granted the motion for reconsideration but returned the same result, finding that even under the new standard plaintiffs nonetheless failed to allege facts sufficient to make a plausible claim of a material misstatement. The court also noted that the allegedly misleading statement that ING “considered its subprime [and] Alt-A . . . exposure to be of limited size and of relatively high quality” was an inactionable statement of opinion. Decision.