Is there anyone who profited from the subprime crisis? Well, some hedge funds bet correctly of course, led by Paulson & Co. JPMorgan Chase's Jamie Dimon and the New York Fed's Tim Geithner each saw their status rise. Goldman Sachs was able to separate itself a bit from its investment banking peers. And some bank analysts really made names for themselves, led by Meredith Whitney and Richard Bove.  

To that list we can now add...plaintiffs attorneys. Clearly, the subprime crisis has proved to be a gold mine for lawyers. A study by Nera Consulting looked at all the shareholder suits filed in federal courts in the first half of the year; as reported by Financial News Online, the study [1] found that 139 actions against 49 companies involved the subprime crisis at various levels.  

And every day seems to bring more activity. The latest: five pensions have sued Lehman Brothers, basically charging that executives knew the true extent of the crisis, even as they touted the strength of their credit portfolios. The strength of these cases aside, this is all pretty predictable. Upheaval is always accompanied by shareholder suits, despite the decline of Milberg Weiss.   

There will be few companies who escape these sorts of suits. The settlement costs have the potential to be high, so you can add that to the list of issues to be worked through. - Jim [2]