Court Dismisses Securities Class Action Against CIBC Over Subprime Exposure

On Wednesday, U.S. District Judge William H. Pauley III (SDNY) dismissed a securities class action against Canadian Imperial Bank of Commerce and four executives for alleged misstatements concerning the bank’s exposure to securities backed by subprime mortgages.

Judge Pauley ruled that many major financial institutions failed to anticipate a meltdown in the mortgage market, and that the plaintiffs failed to demonstrate that CIBC had information that was contrary to their public statements, the WSJ reports. “CIBC, like so many other institutions, could not have been expected to anticipate the crisis with the accuracy plaintiff enjoys in hindsight,” the court found.

The case was filed on behalf of investors who purchased CIBC shares in the U.S. between May 31, 2007, and May 29, 2008.

Read the WSJ article