News


Judge dismisses suit over Lehman losses

Local school districts lost about $4.6 million

A San Francisco judge has dismissed a lawsuit brought by 12 San Mateo County school districts against the county seeking to recover about $20 million in losses due to the 2008 collapse of Lehman Brothers.

San Francisco Superior Court Judge Richard Kramer on Thursday affirmed a tentative ruling that the county and former treasurer-tax collector Lee Buffington were immune from civil suits.

The school districts — including Menlo Park City, Las Lomitas, Portola Valley, and Woodside — sued the county and now-retired treasurer Lee Buffington in January for actions that led to the schools' losses.

Tom Prountzos, an attorney for the school districts, said they plan to appeal.

Of the local school districts, Menlo Park City lost the most by far — about $4 million. The Las Lomitas district lost nearly $400,000; the Portola Valley district, almost $150,000; and the Woodside district, almost $100,000.

The county treasurer's office is in charge of funds that school districts are required to put in an investment pool. The lawsuit alleged the treasurer invested an "imprudent portion" of the funds in Lehman, and kept them there "after learning of deterioration in the finances, credit rating, and stock price of Lehman."

Overall, the Lehman bankruptcy led to $155 million in losses for the county and other agencies participating in the investment pool. But most of those agencies are not required to participate, unlike school districts. The treasurer's office charges "substantial fees" to manage the money, according to Anne Campbell, superintendent of the county Office of Education.

Comments

 +   Like this comment
Posted by 1 percent
a resident of Atherton: other
on Nov 13, 2011 at 9:08 am

One percenters win again!


 +   Like this comment
Posted by Jack Hickey
a resident of Woodside: Emerald Hills
on Nov 14, 2011 at 4:10 pm

The taxpayers are paying for this frivilous litigation. As of june 30, 2011 the County spent $615,492.70 for outside legal help to fend off the lawsuit by school districts. How much of the taxpayer's dollars did the districts spend?


 +   Like this comment
Posted by Michael G. Stogner
a resident of another community
on Nov 14, 2011 at 5:50 pm

Who were the law firms hired by the County?


 +   Like this comment
Posted by Jack Hickey
a resident of Woodside: Emerald Hills
on Nov 14, 2011 at 9:53 pm

S.F. based Keker and Van Nest.


 +   Like this comment
Posted by R.Gordon
a resident of another community
on Nov 15, 2011 at 5:41 am

Somehow, the figures do not add up.
This is frivolous and silly.


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Email:


Post a comment

Posting an item on Town Square is simple and requires no registration. Just complete this form and hit "submit" and your topic will appear online. Please be respectful and truthful in your postings so Town Square will continue to be a thoughtful gathering place for sharing community information and opinion. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

We prefer that you use your real name, but you may use any "member" name you wish.

Name: *

Select your neighborhood or school community: * Not sure?

Comment: *

Verification code: *
Enter the verification code exactly as shown, using capital and lowercase letters, in the multi-colored box.

*Required Fields

Early Decision Blues
By John Raftrey and Lori McCormick | 0 comments | 2,413 views

What Are Menlo Park’s Priorities?
By Erin Glanville | 39 comments | 1,573 views

Death with Dignity
By Chandrama Anderson | 6 comments | 1,452 views

Just Stuff Me and Wrap Me Up
By Laura Stec | 0 comments | 1,003 views

Are you considering a remodel?
By Stuart Soffer | 2 comments | 329 views