S&P wins right to Geithner documents in $5 billion U.S. fraud lawsuit

Thu Sep 25, 2014 4:28pm EDT
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By Jonathan Stempel

NEW YORK (Reuters) - A federal judge said former U.S. Treasury Secretary Timothy Geithner must give Standard & Poor's documents he used when writing his best-selling memoir, a ruling that could help S&P defend against the government's $5 billion fraud lawsuit over its credit ratings.

In a ruling made public on Thursday, U.S. District Judge David Carter in Santa Ana, California said the McGraw Hill Financial Inc MHFI.N unit may force Geithner to turn over unedited versions of the documents.

S&P believes the documents may support its claim that the February 2013 lawsuit was filed in retaliation for its having downgrading the country's debt 18 months earlier.

Carter reviewed the documents before ruling and said the government will have a chance to invoke White House privilege before Geithner must turn them over to S&P.

"A former executive official cannot, with one hand, withhold information implicated in a case of significant public importance while, with the other, collect money from sales of a tell-all book containing much the same information," Carter wrote. "The public has a right to every man's evidence."

Carter also reviewed dozens of unredacted documents that S&P had sought from the government. He ordered that all but five be turned over to S&P, saying the rating agency had demonstrated a "compelling" or "substantial" to obtain them for its defense.

Geithner's book "Stress Test: Reflections on Financial Crises" spent the month of June on the New York Times' hardcover nonfiction best-seller list, ranking fourth in its first week.

Jenni LeCompte, a spokeswoman for Geithner, declined to comment. Geithner is now president at Warburg Pincus LLC. A spokesman for the private equity firm did not immediately respond to a request for comment. The U.S. Department of Justice had no immediate comment.   Continued...

Former Treasury Secretary Timothy Geithner speaks during a Thomson Reuters Newsmaker event in the Manhattan borough of New York, May 23, 2014. REUTERS/Keith Bedford