Ahead of the filing S&P’s RatingrnServices released a statement saying that the expected suit focused on itsrnratings in 2007 of certain U.S. collateralized debt obligations (CDOs).  The company said the lawsuit would bernentirely without factual or legal merit and would disregard the central factrnthat S&P reviewed the same subprime data as the rest of the market andrnfederal agencies and that every CDO cited by DOJ received the same independentrnratings from other  rating agencies.  </p

The company said it did take extensivernrating actions in 2007, ahead of other agencies, on residential mortgage-backedrnsecurities (RMBS) included in these CDOs and “As a result of these actions,rnmore collateral or other protection was required to support AAA ratings onrnCDOs. With 20/20 hindsight, thesernstrong actions proved insufficient but they demonstrate that the DOJ would be wrong in contending that S&Prnratings were motivated by commercial considerations and not issued in goodrnfaith.”</p

S&P provided numerous other examplesrnof downgrades and other actions it took as problems became apparent and saidrnits analysts “worked diligently to keep up with an unprecedented, rapidlyrnchanging and increasingly volatile environment, while acting to ensure changesrnto their ratings reflected robust analysis and deliberation.”  </p

McGraw-Hill’s stock was down 8 percent Tuesday morning on top of a 13.8rnpercent loss on Monday after the S&P press release.   Sharesrnof Moody’s Corp slid 10.7 percent on Monday and another 2 percent so far today.

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