Lawsuit vs Freddie Mac rejected by U.S. appeals court
NEW YORK Nov 5 (Reuters) - A federal appeals court on Tuesday upheld the dismissal of a lawsuit accusing Freddie Mac of misleading shareholders by understating its subprime mortgage exposure and overstating its capital strength prior to the financial crisis.
The 2nd U.S. Circuit Court of Appeals in Manhattan said shareholders failed to show the necessary connection between Freddie Mac's alleged misleading or inadequate disclosures and the losses they suffered.
Tuesday's decision upheld a Sept. 2012 ruling by U.S. District Judge John Keenan in Manhattan in favor of Freddie Mac and officials including former Chief Executive Richard Syron.
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