SD&M represents King County, Washington in a lawsuit filed against Merrill Lynch for violations of the securities laws and breach of contract. The complaint alleges that Merrill Lynch made material misrepresentations and omissions to King County in connection with the County’s purchase of over $100 million of commercial paper issued by two Structured Investment Vehicles (SIVs) known as Mainsail II and Victoria Finance. These investments were not––as represented––safe, conservative, and liquid money market investments. To the contrary, they were extremely risky investments backed largely by subprime mortgages and other toxic assets. Merrill Lynch––then the most active underwriter of Collateralized Debt Obligations (CDOs) in the world, and among a handful of the most sophisticated players in the Asset Backed Securities (ABS) business–– was aware of the very serious undisclosed risks associated with these investments. King County was not.

The lawsuit, filed on July 16, 2010 in the United States District Court for the Western District of Washington, seeks damages and equitable relief in excess of $60 million. Casey Dobson, Jamie Baskin, and Abe Kuczaj lead the SD&M team on behalf of King County, along with co-counsel Themis PLLC of Washington, D.C., and Seattle- based Corr Cronin Michelson Baumgardner & Preece LLP.