Appeals court rejects S&P, Moody's request to dismiss ratings lawsuit

|About: Moody's Corporation (MCO)|By:, SA News Editor

McGraw Hill (MHFI) unit S&P and Moody's (MCO) must face a lawsuit from Calpers over ratings they gave on investments that led to losses of $800M.

An appeals court affirmed a lower-court ruling from 2012 to reject the firms' request to dismiss the case.

Calpers sued the agencies in 2009 after the collapse of three investment vehicles that were supported by sub-prime mortgages. The pension system had invested $1.3B.

S&P is the subject of similar lawsuits from the Justice Department and individual states, including California.