8-KOther EventsExhibits & Filings

MOODYS CORP /DE/ 8-K Report, Corporate Update (Jul 24, 2012)

Filed July 24, 2012For Securities:MCO

Summary

Moody's Corporation (MCO) filed an 8-K on July 24, 2012, to report on the preliminary approval of a settlement for shareholder derivative lawsuits. These lawsuits, filed by both federal and state action plaintiffs, alleged claims related to the company's ratings of certain structured finance transactions and named current and former executive officers and directors as defendants. The company and the plaintiffs entered into a Stipulation of Settlement on May 17, 2012, which the court granted preliminary approval on July 20, 2012. A final court hearing is scheduled for September 6, 2012, to determine the fairness and adequacy of the settlement, the dismissal of the actions, and the award of attorneys' fees and expenses for the plaintiffs' counsel. The plaintiffs' counsel plans to seek approximately $4 million in attorneys' fees and $950,000 in expense reimbursement.

Key Highlights

  • 1Moody's Corporation has reached a preliminary settlement for shareholder derivative lawsuits concerning structured finance transaction ratings.
  • 2The lawsuits were filed by Louisiana Municipal Police Employees Retirement System, W.A. Sokolowski, Thomas R. Flynn, Herbert M. Stein, Jr., Brockton Contributory Retirement System, and Rena Nadoff.
  • 3The derivative actions were brought on behalf of Moody's against current and/or former executive officers and directors.
  • 4The court granted preliminary approval to the Stipulation of Settlement on July 20, 2012.
  • 5A final court hearing is scheduled for September 6, 2012, to approve the settlement, dismiss the actions, and consider attorneys' fees.
  • 6Plaintiffs' Counsel intends to request approximately $4 million in attorneys' fees and $950,000 in expenses.
  • 7Key documents including the Stipulation of Settlement, Exhibit A, and a Summary Notice are provided as exhibits to this filing.

Frequently Asked Questions

The shareholder derivative lawsuits against Moody's Corporation and its current/former officers and directors concern allegations related to the company's ratings of certain structured finance transactions.

No, the settlement has received preliminary approval from the court. A final hearing is scheduled for September 6, 2012, to determine if the settlement will be formally approved.

The plaintiffs' counsel intends to seek approximately $4 million in attorneys' fees and $950,000 in reimbursement of expenses. The total amount awarded is subject to the court's final approval.

The Stipulation of Settlement is the agreement between the plaintiffs and Moody's that outlines the terms intended to resolve the derivative lawsuits. Its approval by the court will finalize the resolution of these claims.