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December 9, 2021

In Major Victory for Investors, Federal Court Rejects Goldman Sachs’ Claim That Its Fraudulent Statements Were too “Generic” to Matter, as We Argued in the Supreme Court

Thursday, December 9, 2021
Contact: Doug Walker at 202-618-6430 or

Washington, D.C.  –  Stephen Hall, Legal Director and Securities Specialist for Better Markets, issued the following statement on the district court’s decision in In re Goldman Sachs Group, Inc. Securities Litigation, issued yesterday and  in line with our amicus brief filed in the Supreme Court:

“In a major victory for investors, the district court in the Southern District of New York rejected Goldman Sachs’ arguments that its misrepresentations were too “generic” to influence investors or the bank’s stock price.  That baseless argument was rejected as a matter of law by the Supreme Court, where we argued that a bank’s approach to powerful conflicts of interest has proven legally material to shareholders and clients time and time again, especially at Goldman. But the district court still had to follow the Supreme Court’s instruction to consider whether, given the specific nature of Goldman’s bogus claims, they were indeed too generic to influence the bank’s stock price.

“After thoroughly reviewing the evidence from both sides, the district court found that the plaintiffs had produced compelling evidence showing that the alleged misstatements did in fact prop up Goldman’s stock price.  And going to the “heart” of the dispute, the court further held that Goldman’s phony claims about how well it managed its conflicts of interest were not so generic as to diminish their role in maintaining the price of Goldman’s stock.

“The district court also rejected Goldman’s galling defense that since every bank is making the same fraudulent statements, presumably for the purpose of inducing reliance by investors and influencing the market price, no one would care and the market would be indifferent to such claims. Applying common sense, as instructed by the Supreme Court, the district court judge rightly rejected this desperate argument, observing that such claims about managing conflicts of interest would never have become so common among banks in the first place if they were ‘incapable of influencing (including by maintaining) a company’s stock price.’

“The decision is a major victory for the plaintiffs, as their claims can proceed to trial and Goldman can be held accountable. The case represents some of the most shameless fraud underlying the 2008 financial crisis, as Goldman allegedly duped investors into believing it was aligned with their interests even while it was surreptitiously betting against the very investments it had foisted onto those investors.  The court’s ruling will also benefit any future injured investors confronted with the appalling defense that a bank’s statements were fraudulent but simply too general to matter.”


Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies – including many in finance – to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit



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