Risk Management

Suit Seeks Countrywide’s Books, Records

A pension fund is reportedly looking for further information on the company's stock-option practices.
Stephen TaubApril 9, 2007

A Delaware judge will allow a “books and records” lawsuit to proceed against Countrywide Financial, reported the Associated Press.

The lawsuit had been filed by the Louisiana Municipal Police Employees Retirement System, which reportedly is looking for further information on Countrywide’s stock-option practices. “Something looks amiss,” Michael Barry, an attorney for the pension fund, argued in court, according to the AP. Barry also reportedly pointed to a series of option grants by Countrywide that coincided with low prices for the company’s stock.

Countrywide has not admitted to any irregularities regarding its option-granting practices, the AP noted. The wire service also pointed out that the pension fund would be required to show credible grounds for suspecting wrongdoing to obtain a court order requiring Countrywide to provide the documents.

The books-and-records lawsuit is scheduled for April 18 before Vice Chancellor John Noble of the Court of Chancery, according to the AP.