Paulson Asks Judge To Dismiss Abacus Lawsuit

Paulson Asks Judge To Dismiss Abacus Lawsuit
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Paulson & Co. has requested that the lawsuit which alleges that it conspired with Goldman Sachs Group, Inc. (NYSE:GS) be dismissed.

The lawsuit claims the conspiracy was aimed at getting a bond insurer to make a guarantee for payments on an investment that was allegedly not supposed to succeed.

Paulson Asks Judge To Dismiss Abacus Lawsuit

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Reuters reports that the firm’s request to dismiss the suit was made in a court filing on Monday. Paulson & Co. said it did not misrepresent anything when discussing the Abacus collateralized debt obligation with ACA Financial Guaranty.

ACA sued Goldman Sachs Group, Inc. (NYSE:GS) for$120 million in 2011. It then amended that suit earlier this year and added Paulson & Co. and also its hedge fund as defendants in the suit.

The amended suit now claims that Paulson & Co. and Goldman Sachs made it appear as if Paulson was making an investment into Abacus. However, Paulson ended up shorting the collateralized debt obligation.

Paulson has said it didn’t have anything to do with the way Goldman Sachs Group, Inc. (NYSE:GS) offset its risks or the way Abacus was represented to investors. The firm said ACA is using “mischaracterizations, emails unrelated to Abacus and snippets of correspondence taken out of context” to build its case.

A spokesperson for Goldman Sachs Group, Inc. (NYSE:GS) did not comment about the case to Reuters. Goldman Sachs settled with the Securities and Exchange Commission in 2010 in connection with allegations of misleading investors in regards to Abacus. However, it was not required to admit wrongdoing as part of that settlement.

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