Rainmaker stirs teacup, Civitas sees storm.

A swarm of securities class action law firms have been bad mouthing each other and their clients as they jostle for position of lead plaintiff in a class action lawsuit related to the lackluster Facebook IPO. Civitas has taken the spurious claims of pugilistic legal underdogs, Robbins Geller Rudman & Dowd, as evidence of "a sordid affair" that "underscores the need for North Carolina to convert to a 401(k) style retirement plan". Hardly.

North Carolina Retirement Systems (NCRS) run by State Treasurer Janet Cowell is one of a group of plaintiffs that represent the largest losses in the case. NCRS lost $4 million after investing in the IPO. At the heart of the case is the claim that Facebook gave rosier earnings projections than were warranted, that Facebook knew revenue growth would decline with increased use of mobile devices, that Facebook shared these concerns with its underwriters who in turn shared the lower forecasts only with select investors.

The law firm trash talking the NCRS as a lead plaintiff claims a conflict of interest in that Erskine Bowles, a director of Facebook and of lead underwriter Morgan Stanley, was a contributor to the campaign of Janet Cowell, State Treasurer also sole trustee of NCRS.

The irony in this claim of "crippling defects" in the plaintiffs case, and Civitas' retelling, is that NCRS did not obviously benefit from any insider knowledge, hence the lawsuit. Bernstein Litowitz Berger & Grossmann, attorneys for NCRS and other major palintiffs submitted an ititial response to Robbins Geller Rudman & Dowd, politely smacking them down. As noted in the Reuters article by legal writer Alison Frankel:

"Look for a more forceful response to Robbins Geller from North Carolina in the reply briefs due next week."

The Civitas spin is a cherry-picked cheap shot. Perhaps by "sordid affair" writer Balfour means to imply an improbable double-con that the State Treasurer knew about the earnings forecast and bought the stock anyway to benefit Bowles. In fact State Treasurer Janet Cowell is zealously guarding and growing NC retirement assets in a way that few individual investors in 401(k) retirement plans could even hope to achieve.

Republicans have plenty of material to attack Democrats but that doesn't stop the propaganda labs at Civitas and AFP from inventing new recipes to feed us stale tea party leftovers.

Comments

Why lie when the truth is available?

I've asked a number of people recently why conservatives in power in North Carolina seem to have a propensity to make stuff up at the expense of valid complaints they might have. The consensus seems to be that conservatives understand the demographics of the state are changing, not in their favor, that they don't won't have much time in control and, they will do just about anything to hold on as long as possible.

Agree wholeheartedly

In fact State Treasurer Janet Cowell is zealously guarding and growing NC retirement assets in a way that few individual investors in 401(k) retirement plans could even hope to achieve.

When John Hood tried to attack Cowell a few weeks ago I thought he was just running out of things to write about. But it appears there's a concerted effort by the puppets to swing this election, and they wouldn't be doing it unless someone was jerking their strings.

p.s. Thanks, Greg. Your researching and writing skills have not gone unnoticed. :)

Don't know...

...others are beginning to take notice. One of Erskine's captial management fund largest clients is the NC Retirement System, while his wife is a fundraiser for Janet Cowell, the State Treasurer? Why would an elected official put themselves in such a compromising situation, especially if they do not want the appearance of unethical behavior.

https://www.facebook.com/#!/takeprideincarolina

No SEANC endorsement for Cowell

Wonder if the questionable dealings with Erskine had anything to do with SEANC not endorsing Janet Cowell???

http://seanc.org/news/seanc-in-the-news/state-employee-pac-endorses-bipa...

I'd be more inclined

to believe that SEANC's new BFF's in the Republican Party leaned on them to hold back their endorsement of Cowell.

In case of doubt,

read the words of SEANC's Director:

DanaDcope Jun 28, 4:08pm via Twitter for iPhone Perdue veto-again bad policy/bad politics.Half billion for raises next year after barebone budget Gov can you say R landslide?#ncga#ncpol

SEANC's members better hope there isn't an "R landslide", because you can bet your bottom dollar state employees will be buried in the rubble.

oh yes...just like was

oh yes...just like was predicted after the 2010 elections and SEANC wound up getting more from the GOP than they had the Democrats in years? If nothing else, SEANC is showing that they stand with those who helped them the most over the year(s): Linda Coleman, Phil Berger, Nelson Dollar, Darren Jackson, etc.

Speaking of Linda Coleman,

here's what she had to say about those helpful Republicans:

State personnel director Linda Coleman says the latest budget cuts are the largest reduction in workforce in the history of state government.

"In the past, when a state employee was laid off by one department, they were usually able to find a job in another department,” Coleman says. “But this is a new day in state government, and what worked in the past simply won’t work in these challenging times. We’re tightening our belts and doing more with less.”

State employees got more from the GOP in years allright. More cuts.

But less cuts than what was

But less cuts than what was in the Governor's budget for non-education employees, more in pay increases, and full funding of the Retirement System for the first time in over 10 years.