Massey, BP, Merrill, Galleon, MBIA, Tullett, Morgan Stanley in Court News

Massey Energy Co., dealing with the death of 29 miners at one of its West Virginia coal mines, is being investigated by the FBI for possible bribery of state and federal inspectors, a person familiar with the probe said.

An April 5 explosion at the Richmond, Virginia-based company’s Upper Big Branch Mine resulted in the deaths and sparked the investigation by the bureau, a second person familiar with the matter said April 30, asking not to be identified because the matter is confidential.

At least two dozen Massey employees, federal and state officials and mine union members have been interviewed by agents of the Federal Bureau of Investigation, the first person familiar with the investigation said.

The mine and its operators could be held criminally responsible for the explosion if there were any “overt acts,” such as falsification of inspection documents or evidence of tampering with monitors and recording devices, said Bruce Stanley, a Pittsburgh attorney who represents the widows of two miners killed in an earlier incident.

Should the FBI interview turn up evidence of criminal conduct, the matter would be referred to the U.S. Attorney in the Southern District of West Virginia, the first person said.

The U.S. Department of Labor Mine Safety and Health Administration and the West Virginia Office of Miner’s Health Safety and Training have also been investigating the accident.

“We are aware that investigators are interviewing witnesses, but are not aware of the nature of their investigation,” Massey said April 30 in a statement. The company said it intends to cooperate in all phases of the accident investigation.

“We never comment on criminal investigations,” MSHA spokeswoman Amy Louviere said.

Massey spokesman Jeff Gillenwater didn’t return a call for comment, nor did Massey lawyer Shane Harvey or a representative of the company’s media hotline. Calls during weekend hours to Ronald Wooten, director of the West Virginia Office of Miners Health Safety and Training, weren’t returned.

Tracy Schmaler of the U.S. Justice Department press office didn’t return a call for comment.

The widows’ case is Bragg v. U.S., 2:10-cv-00683, U.S. District Court, Southern District of West Virginia.

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New Suits

BP, Transocean Lawsuits Surge as Oil Spill Spreads in Gulf

BP Plc and Transocean Ltd. face at least 36 lawsuits, including group cases with potentially thousands of plaintiffs, over environmental damage and personal injuries caused by the oil spill in the Gulf of Mexico.

At least 31 proposed class-action suits have been filed in courthouses from Texas to Florida. Commercial fishermen, shrimpers, charter-boat operators and beachfront-property owners asked to represent anyone whose livelihood depends on coastal waters imperiled by the drifting oil. At least 24 cases were filed April 30.

BP has the primary liability for damage caused by the spill, said Keith Hall, an attorney in New Orleans, who isn’t involved in the litigation. He cited a U.S. law passed after the Exxon Valdez oil spill at Alaska in 1989.

“Under the Oil Pollution Act, the fact that it was BP’s oil is enough,” said Hall, of Stone Pigman Walther Wittmann LLC. Plaintiffs “don’t have to show they were negligent or grossly negligent,” he said.

Transocean’s spokesman Guy Cantwell and BP’s Daren Beaudo didn’t respond to requests for comment on the rapid increase in lawsuits. Both men said previously it was against company policy to comment on pending litigation.

Lawsuits also name Cameron International Corp., which provided blowout-prevention equipment, and Halliburton Energy Services Inc., which was involved in cementing the well.

Scott Amann, a spokesman for Houston-based Cameron, the second-largest U.S. maker of oilfield equipment behind National Oilwell Varco Inc., said the company doesn’t comment on litigation.

Cathy Mann, a spokeswoman for Houston-based Halliburton, the second-largest oilfield contractor behind Schlumberger Ltd., said the company is cooperating with investigations into the accident. She said “it is premature and irresponsible to speculate on any specific causal issues.”

The suits are multiplying as the companies struggle to cap a damaged undersea well leaking 5,000 barrels of crude oil a day since the Deepwater Horizon drilling rig exploded April 20. The edge of the spill has begun washing ashore in Louisiana and may reach Florida’s coast early next week.

“The litigation is spreading faster than the slick,” said Houston-based plaintiffs’ attorney Tommy Fibich in an interview. “BP may be as endangered as the brown pelican. This litigation will dwarf other corporate catastrophes.”

The April 30 cases include Fishtrap Charters LLC v. Transocean Holdings, 1:10-cv-00202, and Fort Morgan Sales, Rentals & Development v. Transocean Holdings, 1:10-cv-00203, U.S. District Court, Southern District of Alabama (Mobile).

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Takefuji Sues Merrill for $309 Million Over Bond Loss

Takefuji Corp. sued Merrill Lynch Japan Securities Co. for about 29 billion yen ($309 million) over losses from a 2007 bond deal designed to lower the Japanese consumer lender’s interest costs.

The lawsuit alleges Merrill Lynch, now a unit of Bank of America Corp., failed to sufficiently explain the risks in the transaction, which involved Takefuji investing 30 billion yen in a credit-linked security created by the U.S. brokerage, said Takefuji spokesman Kentaro Itai in an interview.

“We deny the allegation, and we will defend ourselves vigorously,” said Takayuki Inoue, a Tokyo-based spokesman at Merrill Lynch.

Takefuji said in May 2007 it would reduce annual interest costs by 1.2 billion yen by transferring the 30 billion-yen, 4 percent bond to an unidentified third party as part of the deal. Instead, the note it bought from Merrill Lynch was liquidated after 10 months as the securities backing it slumped, Itai said. Takefuji was forced to resume paying interest on the original bond, the company said in March 2008.

The Japanese company booked a 29.6 billion-yen loss on the transaction in the fiscal year through March 31, 2008. Shares in Takefuji fell 6.6 percent on the day the loss was announced. It sued Merrill Lynch in the Tokyo District Court on April 28, according to Itai.

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U.K. Arrests 22 as CO2 Trading Tax Probe Widens to 9 Countries

U.K. officials arrested 22 people as part of a Europe-wide investigation into tax fraud related to carbon dioxide emissions-credit trading.

Investigators arrested 13 people in England and eight in Scotland, Jonathan Hall, a spokesman for U.K. tax officials, said in a phone interview. One other person was arrested on a European arrest warrant.

German prosecutors and tax investigators on April 28 searched Deutsche Bank AG, HVB Group and RWE AG as part of raids on 230 offices and homes. The investigation involves 180 million euros ($239 million) of possible tax evasion and is targeting 150 suspects at 50 companies.

Frankfurt prosecutors had asked colleagues in European nations, including Belgium, the Netherlands and Norway for legal assistance, prosecutor spokesman Guenter Wittig said in an interview April 30.

“We’ve been working intensively on the international level in this case,” said Wittig. “The probe is only at the beginning and may result in further investigative action.”

The U.K. arrests took place on April 28, Hall said. Three other suspects were detained in Germany that day, said Wittig. He declined to identify any suspects or companies involved.

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Qwest Communications Sued Over $10 Billion CenturyTel Takeover

Qwest Communications International Inc. was sued by shareholders seeking more money in a planned $10 billion stock- swap acquisition by CenturyTel Inc.

Qwest investors Lorrieann Martin and Mark Respler asked a judge to halt the takeover and award damages in a complaint filed April 29 in Delaware Chancery Court in Wilmington.

Given Qwest’s financial prospects, selling the company at a “relatively low current trading price in a recession-depressed market raises serious red flags” about whether directors are maximizing shareholder value, according to the complaint.

CenturyTel, based in Monroe, Louisiana, said April 22 it would pay 0.1664 CenturyTel shares for each share of Denver- based Qwest.

Diane Reberger, a Qwest spokeswoman, said the company doesn’t comment on pending litigation.

The case is Martin v. Qwest Communications International Inc., CA5446, Delaware Chancery Court (Wilmington).

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Lawsuits/Pretrial

Galleon’s Rajaratnam Said He Was Duped in Illegal Tax Shelter

Galleon Group LLC co-founder Raj Rajaratnam, indicted last year in an alleged multimillion-dollar hedge fund insider trading scheme, said in a 2005 lawsuit that he was tricked into investing in an illegal tax shelter.

Four years before he was charged, Rajaratnam and Galleon co-founder Gary Rosenbach sued accounting firm KPMG LLP and tax shelter promoter Diversified Group. After the Internal Revenue Service disallowed $13.5 million in tax transactions from 1999 and 2000, Rajaratnam was forced to pay back taxes as well as interest and penalties of $7.9 million, according to the complaint. He and Rosenbach, from whom the IRS sought $9 million, then sued KPMG and Diversified.

Rajaratnam asked a KPMG partner “numerous times if the shelter he described was ‘legal,’” according to the complaint filed in New York state court in Manhattan. The partner “repeatedly assured Rosenbach and Rajaratnam that the shelter was legal under the tax laws and that it would be fully supported by a legal opinion letter from a prominent law firm.”

Daniel Richman, a former federal prosecutor in Manhattan who now teaches at Columbia University Law School, said prosecutors at Rajaratnam’s insider trading trial, set for October in Manhattan federal court, may seek to question him about the illegal tax transaction -- and the details of why he entered into it -- should he testify. Rajaratnam’s spokesman Jim McCarthy said the suit is unrelated to the criminal prosecution.

“It will provide grist for cross-examination,” Richman said. “If he described his business model, or all kinds of things he said to explain what he was doing, that might really be at odds with what statements he might make now. That’s the kind of thing that might find its way into a trial.”

The lawsuit sought to recover at least $15 million in interest, penalties and fees that Rajaratnam and Rosenbach paid to the IRS. It didn’t seek the taxes they paid. Rajaratnam and Rosenbach won a 2009 arbitrators’ judgment against Diversified and its president for $5.8 million, according to court records, which don’t reflect whether KPMG made a payment.

“We were very happy with the successful resolution of this, which reimbursed our clients for losses,” Stuart Grant, the lawyer for Rajaratnam and Rosenbach, said in an interview. He declined to comment on the status of the suit against KPMG.

KPMG spokesman Tim Connolly; William Wachtel, a lawyer for Diversified; Doug Koff, attorney for Rosenbach; and Yusill Scribner, a spokeswoman for Manhattan U.S. Attorney Preet Bharara; declined to comment.

The case is Rosenbach v. Diversified Group, 05-602463, New York State Supreme Court for New York County (Manhattan).

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Google Bid to Toss Suit Threatens Ohio Antitrust Law

Google Inc.’s bid to dismiss a lawsuit alleging it abused its market power by increasing a competitor’s cost for advertising would threaten Ohio’s antitrust law if successful, state Attorney General Richard Cordray said.

Google sued myTriggers.com, claiming it was owed $335,000 in advertising payments. MyTriggers countersued claiming Google violated antitrust law by raising its costs as much as 10,000 percent and lowering its advertising rating after realizing myTriggers was a competitor.

Cordray joined the dispute after Google sought to have the counterclaim thrown out in an April 2 filing in state court in Columbus, Ohio. Google said the Valentine Act, the state’s antitrust law, doesn’t apply because the federal Communications Decency Act precludes state regulations.

Agreeing to Google’s claim “would immunize an entire industry from the reach of this state’s antitrust laws,” Cordray said in court papers filed April 26. Preempting the Valentine Act with the federal law “would result in a significant restriction of antitrust enforcement in Ohio,” he said.

The Valentine Act was enacted in 1898 following a state government investigation into price fixing in the coal, insurance, railroad and oil industries. The law prohibits price fixing, production limits and controlled sales.

MyTriggers operates a search engine that charges users on a cost-per-action, or CPA, basis, meaning the company gets paid only after a purchase is made. Google and most other search engines operate on a cost-per-click, or CPC, basis, under which advertisers pay each time a user clicks on an ad.

Jon Murchinson, a Google spokesman, didn’t return a voice- mail seeking comment April 30.

The case is Google Inc. v. myTriggers.com. 09-cvh-10-14836. In the Common Pleas Court of Franklin County, Ohio (Columbus).

MBIA Insurance’s Fraud Claim Against Countrywide Can Proceed

MBIA Insurance can proceed with a lawsuit alleging Bank of America Corp.’s Countrywide Financial committed fraud in obtaining insurance on billions of dollars of mortgage-backed securities, a judge ruled.

The insurer, based in Armonk, New York, claimed in its suit that Countrywide “falsely represented” to MBIA, and to investors in trusts holding the securities, that Countrywide originated the mortgage loans in strict compliance with its underwriting standards and guidelines. The insurer has covered more than $459 million of losses as a result, MBIA said in the 2008 complaint.

New York State Supreme Court Justice Eileen Bransten, in Manhattan, denied Bank of America and Countrywide’s renewed motion to dismiss the bond insurer’s fraud claim. In the April 27 ruling made public April 30, Bransten also refused to dismiss a claim of successor and vicarious liability against Bank of America, which acquired Countrywide in 2009.

Bransten dismissed a claim by MBIA of “negligent misrepresentation,” against Countrywide, ruling the plaintiff had failed to show the commercial relationship existed between the two that would support the allegation.

“We are pleased that the court has allowed our case to move forward against both Countrywide and Bank of America,” Kevin Brown, an outside spokesman for the insurer, said in an e- mailed statement.

In an e-mailed statement, Shirley Norton, a spokeswoman for Bank of America, said, “This is a procedural ruling and not a ruling on the merits or facts of the case. We will continue to vigorously defend against the allegations.”

The case is MBIA Insurance Corp. v. Countrywide Home Loans Inc., 08602825, New York State Supreme Court, New York County (Manhattan).

New Mexico CDO-Fraud Case Against UniCredit Unit Is Rejected

A New Mexico judge has tossed out a former public pension manager’s lawsuit to recoup at least $90 million in state funds lost through investments in mortgage-backed securities sold by a firm whose executives donated to Governor Bill Richardson’s presidential campaign.

District Judge Stephen Pfeffer in Santa Fe dismissed the case brought by Frank Foy, a former chief investment officer for the state’s Educational Retirement Board, saying in an April 28 decision that the actions at issue preceded the law under which the case was filed, the Fraud Against Taxpayers Act. The law took effect in 2007. The money-losing investments began in 2004.

Foy claimed that as much as $243 million in state funds were used to buy “worthless” collateralized debt obligations, or CDOs, sold by Chicago-based Vanderbilt Capital Advisors. Vanderbilt was acquired in 2006 by UniCredit SpA, based in Milan, Italy. Foy began the lawsuit in 2008. State records show that as much as $22 million in finder’s fees were shared by the son of a political ally of Richardson, a Democrat.

“We’re very pleased with the decision,” said Peter Simmons, a partner at Fried, Frank, Harris, Shriver & Jacobson who represents the Vanderbilt units named as defendants. He is based in New York.

Alarie Ray-Garcia, a Richardson spokeswoman, didn’t respond to a request for comment April 29. Gilbert Gallegos, Richardson’s deputy chief of staff, earlier described the case as without merit.

Victor Marshall, Foy’s lawyer, said Pfeffer overlooked fraud and misrepresentation laws that predate the investments.

“The judge’s analysis does not dispose of the entire case,” Marshall said. He said he is consulting with New Mexico Attorney General Gary King, who filed a friend-of-the-court brief defending the 2007 fraud law, before taking further steps.

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SAC Capital’s Cohen Will Seek Dismissal of Ex-Wife’s Lawsuit

SAC Capital Advisors LP founder Steven A. Cohen, whose ex- wife accuses him in a lawsuit of cheating her out of money in their 1990s divorce, will ask a judge to dismiss the suit, his lawyer said in court April 30.

Martin Klotz, a lawyer for Cohen, said he will make the motion on May 7. In an April 20 letter to U.S. District Judge Richard J. Holwell, Klotz said a dismissal is warranted in part because the deadline has passed for filing such a suit.

“Plaintiff’s divorce, and the conduct about which she complains, are now ancient history,” wrote Klotz, a lawyer with Willkie Farr & Gallagher LLP in New York.

Patricia Cohen seeks a “substantial, if not controlling, interest in SAC Capital, and various related SAC entities, now valued at over $12 billion,” according to an amended complaint filed in April in federal court in Manhattan.

Gaytri D. Kachroo, Patricia Cohen’s lawyer, asked for and was granted 45 days to respond to the dismissal motion.

Patricia Cohen, who separated from her then-husband in 1988, claims assets were hidden from her and the New York state courts during their divorce proceedings. She said she’s entitled to at least half of his hedge fund business, which was developed in part with $1 million Patricia earned from a real estate business.

The case is Cohen v. Cohen, 09-cv-10230, U.S. District Court, Southern District of New York (Manhattan).

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Trials/Appeals

Barclays Sought Out-of-Bounds Lehman Assets in Buyout

Barclays Plc sought assets it knew might be out of bounds when it bought Lehman Brothers Holdings Inc.’s brokerage after the investment bank’s collapse in 2008, according to a lawyer for the brokerage trustee.

William Maguire of Hughes Hubbard & Reed LLP, the lawyer for trustee James Giddens, showed April 30 a slide in court of an October 2008 report to Barclays’s audit committee with a note indicating the U.K. bank knew of restrictions on certain assets.

“Release of this deposit is subject to SEC approval,” Maguire read from the report on the fifth day of a trial of Lehman’s claims that Barclays should pay as much as $11 billion for an alleged “windfall” received when it bought the brokerage. The deal was sealed in the wake of Lehman’s 2008 bankruptcy, the biggest in U.S. history.

The fight in U.S. Bankruptcy Court in Manhattan before Judge James Peck pits the U.K.’s third-biggest bank against Lehman, which wants money to pay off creditors and brokerage customers. Giddens seeks $6.7 billion from Barclays to pay brokerage clients.

Barclays has said it scanned Lehman’s accounts for additional assets after paying $45 billion for a portfolio of securities as part of the deal. Valuing the securities was complicated because some had never traded, or were created by Lehman to secure credit, Patrick Clackson, chief financial officer of the Barclays Capital investment-banking unit, testified earlier.

“We had just long positions at a time when the markets were incredibly volatile,” Clackson said. In two days of testimony, Clackson told the judge that one of his jobs before the acquisition was to “make sure” it didn’t hurt Barclays at a time when bank capital was under scrutiny by regulators.

Jonathan Hughes, Barclays’s global general counsel, was Lehman’s second witness April 30. To benefit shareholders, “it was of huge importance to Barclays” to show a gain on the acquisition, he said.

“If not, we would at a minimum risk there being a negative impact on capital,” said Hughes, a one-time U.K. barrister with cropped hair and a red tie.

Lehman’s lawyer Robert Gaffey of Jones Day asked him several times why he or his lawyers didn’t tell the court that the deal was changing.

“It was always the same transaction,” Hughes said. Barclays was asking, “Is there an operational business that would be strategically valuable to acquire? The transaction never changed from that point of view.”

The cases are In re Lehman Brothers Holdings Inc., 08- 13555, and James W. Giddens v. Barclays Capital Inc., 09-01732, U.S. Bankruptcy Court, Southern District of New York (Manhattan).

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Tullett Prebon Seeks $3.5 Million in Fees in BGC Lawsuit

Tullett Prebon Plc, the second-largest inter-dealer broker by market value, asked a judge to award it at least 2.3 million pounds ($3.5 million) in legal costs in a lawsuit against its rival, BGC Partners Inc.

Tullett’s lawyer, Jeffery Onions, said at a hearing April 30 that the company proved there was “unlawful conduct on the part of BGC” and that it was entitled to the legal fees. Damages in the case will be determined at a later date.

BGC’s “commercial interests took precedence over the rights and wrongs of the situation,” Onions told the court. Its “defense has now been revealed to be based on lies,” he said.

In March, Justice Raymond Jack ruled that BGC and two executives unlawfully conspired to hire Tullett employees in a dispute that featured allegations about lost BlackBerries and threatening phone calls. BGC was granted the right to appeal the verdict at the April 30 hearing.

Tullett sued BGC seeking cash compensation and a court order blocking BGC from poaching its staff. The firm is also suing BGC in New Jersey, alleging racketeering and seeking at least $1 billion in damages for hiring away 164 brokers in Hong Kong, Singapore, Tokyo, London and the U.S.

“This is a case where nobody has come out of it with credit,” said Andrew Hochhauser, a lawyer for BGC. “These are two companies that regularly engage in litigation; it’s part and parcel of doing business.”

Hochhauser argued April 30 that Jack shouldn’t make a ruling on costs before the damages hearing. Jack said he would postpone making a decision.

The case is: Tullett Prebon Plc v. BGC Brokers LP, HQ09X01241, High Court (London).

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Verdicts/Settlements

Moore Capital, Morgan Stanley, UBS Settle CFTC Cases

Moore Capital Management LP, Morgan Stanley and UBS AG’s securities division agreed to pay more than $39 million to settle separate allegations regarding trading on the New York Mercantile Exchange.

Moore Capital, the $15 billion hedge fund run by Louis Bacon, will pay $25 million to settle the U.S. Commodity Futures Trading Commission’s allegation that a former portfolio manager attempted to manipulate platinum and palladium futures during a surge in prices two years ago, the regulator said April 29.

Morgan Stanley will pay $14 million and UBS $200,000 for a separate allegation that they concealed a block trade of crude oil from Nymex, the CFTC said in a separate statement.

In the platinum and palladium case, a Moore portfolio manager, who wasn’t identified, used buy orders in the closing moments of trading on Nymex to boost settlement prices from November 2007 through May 2008, the CFTC said. The orders “frequently accounted for a significant portion of the volume” in the two thinly traded markets, the agency said.

New York-based Moore said in a statement April 30 that the portfolio manager left the company in the fall of 2008. None of Moore’s principals or its current management were involved in any improper trading, and none were accused of any wrongdoing, the company said.

“Morgan Stanley fully cooperated with the CFTC’s investigation and is pleased to have reached a resolution with our regulator,” spokeswoman Jennifer Sala said in an e-mailed statement. “As the CFTC indicates, this matter concerned an isolated request by a former Morgan Stanley trader.”

UBS spokeswoman Kelly Smith declined to comment.

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Ex-UBS Client Heller Granted $500,000 Bail in Tax Evasion Case

A disbarred lawyer charged two weeks ago with using an offshore UBS AG account to hide $26 million from the Internal Revenue Service was granted bail April 30 by a federal judge.

Kenneth Heller, 80, must post a $500,000 bond before his scheduled release on May 4, U.S. Magistrate Judge James L. Cott ruled in federal court in Manhattan. Heller has been in custody since his April 15 arrest in Hoboken, New Jersey, on charges of tax evasion and failing to file a report over his offshore account.

Heller was one of seven ex-UBS clients charged that day with collectively hiding more than $100 million from the IRS. Eleven former clients of Zurich-based UBS pleaded guilty since the bank admitted in February 2009, when it avoided prosecution by paying a $780 million fine, admitted it helped U.S. clients evade taxes, and turned over the names of U.S. account holders.

Heller, a disbarred New York maritime attorney, opened a UBS account in 2006 with $26.4 million, prosecutors said. He later transferred $20 million to a smaller private Swiss bank, prosecutors said. They accuse Heller of evading more than $2.3 million in federal income taxes.

Heller initially appeared in court on April 15. His lawyer, Fred Dunne, agreed not to seek bail then because prosecutors discovered an outstanding warrant stemming from a contempt conviction when he was still practicing law.

The case is United States v. Kenneth Heller, 10-mg-00742, U.S. District Court, Southern District of New York (Manhattan).

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U.K. Prosecutor to Seek Approval for $46 Million BAE Accord

U.K. prosecutors will ask a London court to approve a 30 million-pound ($46 million) settlement with BAE Systems Plc, Europe’s biggest defense company.

The case had been delayed while two anti-arms groups sought unsuccessfully to block the deal. The U.K. Serious Fraud Office’s settlement with BAE was also complicated by an appeal in a separate case that determined whether the agency had the power to conduct plea bargains.

BAE agreed to pay almost $450 million in February to resolve bribery and fraud investigations by U.S. prosecutors and the SFO. The company pleaded guilty in the U.S. in March and has agreed to plead guilty in the U.K. to accounting irregularities.

The SFO notified BAE’s lawyers at Allen & Overy LLP April 30 that they would proceed with the settlement, spokesman David Jones said in an e-mail April 30.

Lindsay Walls, a BAE spokeswoman, declined to comment on the SFO decision.

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Court Filings

SEC Fraud Suit Against Goldman Sachs Tops Bloomberg Chart

U.S. regulators’ lawsuit accusing Goldman Sachs Group Inc. of fraud related to collateralized debt obligations was the most-read litigation docket on the Bloomberg Law system last week.

Goldman Sachs created and sold CDOs linked to subprime mortgages in early 2007, as the U.S. housing market faltered, without disclosing that hedge fund Paulson & Co. helped pick the underlying securities and bet against the vehicles, the Securities and Exchange Commission said April 16. Billionaire John Paulson’s firm earned $1 billion on the trade and wasn’t accused of wrongdoing. The SEC also sued Fabrice Tourre, a Goldman Sachs vice president who helped create the CDOs, known as Abacus.

The case is Securities and Exchange Commission v. Goldman Sachs, 10-cv-03229, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Elizabeth Amon in Brooklyn, New York, at eamon2@bloomberg.net.

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