Federal Appeals Court rules Barclays not liable to investors who bought in shortly before 2008 recession News
© WikiMedia (Bajajvikram)
Federal Appeals Court rules Barclays not liable to investors who bought in shortly before 2008 recession

The US Court of Appeals for the Second Circuit affirmed Monday the district court judgement that Barclays is not liable to investors who bought in shortly before the 2008 financial collapse.

A series of investors brought the case against Barclays as a class action suit in 2017 alleging that Barclays had a duty to disclose its exposure in the form of risky assets and that the failure to disclose had harmed investors in losses during the 2008 recession. Specifically, they alleged that Barclays distributed misleading offering materials which did not reveal the potential riskiness of the investment.

The court ultimately found that:

For the reasons set forth above, we decide that Barclays has established that none of Askelson’s claims to recovery under section 11 based on the omissions that he alleges to be wrongful survives summary judgment, either because Barclays had no duty to disclose the information Askelson specifies or because Barclays established that the failure to disclose did not cause him to suffer any loss.

The court found that Barclays did not have a duty to disclose the exact assets that the plaintiff called into question. The court then found that even if Barclays had disclosed these assets, the plaintiffs failed to demonstrate that this nondisclosure specifically had caused harm rather than the effects of the financial crisis itself.

This concludes one of the last lawsuits against banking institutions for their role in the 2008 financial collapse.