Summary: Despite Standard & Poor’s Claim that the Justice Department singled them out in their $5 Billion Suit out of retaliation, the U.S. is confident their documents will demonstrate to the court otherwise.
The United States confidently denies that its $5 million suit against Standard & Poor is retaliation, claiming that nothing in the documents S&P sought will expose such a connection. S&P claims that they were singled out, and not their competition, Moody and Fitch, for charges that they inflated ratings before 2008 financial crisis to secure greater fees from issuers, and they alone were targeted because they downgraded the United State’s “triple-A” credit rating on Aug. 5, 2011.
The Justice Department is “confident” that U.S. District Judge David Carter’s review will “not support the defendants’ allegations of retaliation in any way,” as Reuters reported.
S & P meanwhile claims in its recent court filings that government lawyers had “an intense interest in and engagement regarding S&P’s downgrade of the United States,” and further claims that they have access to internal Justice documents that demonstrate “that the two topics were often linked.”
Harold McGraw, chairman for S&P’s larger institution, McGraw Hill, claims that former Treasury Secretary Timothy Geithner told him three days after the downgrade that they had made a “huge” math error, and that they would be held “accountable.” S&P would have to demonstrate that more of this would be found in the Justice’s documents.
The documents are not public, though we might get a peek in the September hearing. The hearing is scheduled to take place Sept. 9, in the case of U.S. v. McGraw-Hill Cos et al, U.S. District Court, Central District of California, No. 13-00779.
S&P meanwhile claims in their case that their opinion of the U.S. credit rating is protected under the First Amendment, and are represented by Floyd Abrams, a First Amendment Specialist.