A federal judge ruled that former U.S. Treasury Secretary Timothy Geithner must hand over documents to Standard & Poor's relating to the ratings agency's claim that the United States sued it in retaliation for downgrading government debt.
The U.S. Department of Justice brought a civil fraud lawsuit against S&P in 2013, accusing it of inflating ratings to win more fees from issuers, and then failing to downgrade debt backed by deteriorating mortgage-backed securities fast enough.
S&P, a unit of McGraw Hill Financial Inc., has claimed the lawsuit was filed in retaliation for the downgrade, and should be dismissed. Its main rating agency rivals, Moody's Investors Service and Fitch Ratings, were not sued.
U.S. District Judge David Carter denied both Geithner's request to set aside S&P's subpoena and a similar request made by the Federal Reserve Bank of New York and Terrence Checki, the bank's executive vice president.
"This incremental approach has the virtues of affording S&P an opportunity to gather the information that it needs to defend itself, while according due respect to the time and autonomy of high-ranking executive officials," Judge Carter wrote in an order on Tuesday.
Geithner is the highest former government official S&P has pursued for information to support its allegations.
"As for any future depositions of Secretary Geithner or Mr Checki, the court will cross that bridge when it comes to it," the court filing stated.
Jenni LeCompte, a spokeswoman for Geithner, did not immediately respond to an email seeking comment. Representatives of the Federal Reserve Bank of New York were not immediately available for comment outside regular U.S. business hours.
Last month, Carter gave S&P access to Department of Justice documents it had sought for its claim that the lawsuit may have been in retaliation for its August 2011 decision to remove the United States' "triple-A" credit rating.
He stopped short of giving S&P access to White House records from that time, but said he would consider such a request later.
S&P has said Geithner angrily told McGraw Hill Chairman Harold "Terry" McGraw in an Aug. 8, 2011 phone call that he was "accountable" for an alleged $2 trillion math error, and that S&P's conduct would be "looked at very carefully."
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