Moody’s, S&P Defeat Subprime-Era Suit Over Securities Ratings

A lawsuit over securities ratings that has seen almost no activity since 2012 ended in a win for Moody’s Investors Services Inc. and McGraw-Hill Cos., the corporate parent of Standard & Poor’s Financial Services LLC.

Retailers American Signature Inc. and SEI Inc.—both of which claimed they’d relied upon those ratings—sued the firms in 2009 after the subprime mortgage crisis allegedly made their auction rate securities worthless, costing them tens of millions of dollars.

The Moody’s and S&P ratings for those securities were allegedly derived from ratings on subprime mortgage-related securities.

Judge Paul G. Gardephe of the US District Court ...