On February 19, 2008, Barroway Topaz Kessler Meltzer & Check, LLP was appointed co-lead counsel in In re UBS AG Securities Litigation, currently pending in the United States District Court for the Southern District of New York, the Hon. Richard J. Sullivan presiding.

After an extensive investigation, plaintiffs filed the Consolidated Amended Class Action Complaint alleging that UBS and various of its officers violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by making materially false and misleading statements regarding UBS's involvement in and risk management of U.S. subprime and Alt-A mortgage-backed securities ("MBS"), UBS's involvement in auction rate securities ("ARS"), and UBS's involvement in assisting U.S. clients in committing tax fraud. Specifically, the Complaint alleges that UBS made materially false and misleading statements regarding: (1) its origination, sale, retention and valuation of subprime and Alt-A MBS and its efforts to manage the risks associated with the positions; (2) its origination, sale, retention and valuation of ARS; and (3) its efforts to comply with relevant U.S. tax law with respect to its U.S.-based clients.

The first aspect of UBS's three-part fraud began to surface with the demise of the U.S. real estate market, culminating in UBS's write-down of more than $40 billion in MBS, the termination of high ranking company officials, and the restructuring of UBS's investment bank. Likewise, investors were shocked to learn that ARS were not the safe "cash-equivalents" that UBS had represented, UBS sold billions in ARS to unsuspecting investors, requiring UBS to buy back $18 billion in ARS from investors, and UBS owned billions of these illiquid securities on its own books. The final shoe dropped when investors learned that top (and since terminated) UBS executives have been indicted by the U.S. government for conspiracy to commit tax fraud. On February 18, 2009, UBS entered into a deferred prosecution agreement with the U.S. Government, whereby the government agreed to defer prosecution of UBS for conspiracy to commit tax fraud and, in exchange, UBS agreed to pay a $750 Million fine and turn over the names of U.S. citizens who had avoided paying U.S. taxes by setting up and maintaining an undeclared Swiss bank account with UBS’s assistance.

As a result of the alleged fraud and in addition to the more than $40 billion in MBS write-downs, UBS has sought the infusion of almost $28 billion in cash through two rights offerings and agreed to take a bailout from the Swiss government worth more than $60 billion.

Defendants filed two motions to dismiss the complaint for failure to state a claim and for lack of subject matter jurisdiction on November 19, 2008.  The parties completed briefing on Defendants’ motion to dismiss on March 31, 2009.  Shortly thereafter, as a result of the emergence of new facts regarding UBS’s participating in a scheme to defraud the U.S. Government, the Court granted Plaintiffs leave to amend the complaint.  On May 8, 2009, Plaintiffs filed the Amended Consolidated Securities Class Action Complaint.  Defendants filed two motions to dismiss the complaint for failure to state a claim and for lack of subject matter jurisdiction on September 30, 2009.  Plaintiffs' opposition to defendants' motions is due December 15, 2009.