RBS class action lawsuit dismissed by US judge

14 January 2011

A class action lawsuit against the Royal Bank of Scotland (RBS) has been thrown out of court by a judge in the US.

Shareholders took legal action in the US against the financial institution after they suffered losses on their stakes in the bank following the financial crisis of 2008.

The investors had filed the suit in America as it is reportedly easier to take such an action in the US rather than the UK.

However, judge Deborah Batts ruled that the cases could not be processed as the investors had not purchased their securities in the country.

She cited a previous ruling where an Australian investor’s attempt to bring a similar action in New York against National Australia Bank was rejected as the securities were not listed on a US exchange.

An RBS spokesman said: “RBS welcomes Judge Batts’ decision to dismiss these claims. We will of course continue to defend the remaining claims vigorously.”

RBS suffered large losses during 2008 as the global credit crisis unfolded and led to the institution requiring more than £45 billion worth of government money to remain afloat.

By Jim Ottewill

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