Goldman Sued by Pair of Pension Funds - TheStreet



) --

Goldman Sachs

(GS) - Get Report

took a couple more body blows Tuesday as investors await its fourth-quarter results next week.

Wall Street bonuses have been a hot topic almost from the moment that the calendar turned to 2010, and Goldman is often held up as the poster child for excessive compensation. On Monday, New York Attorney General

Andrew Cuomo



to eight U.S. banks, including Goldman, requesting information about their compensation policies. Now the company is facing a pair of lawsuits from two U.S. pension funds trying to block an expected $22 billion in compensation payments.

The plaintiffs,

Central Laborers' Pension Fund

and the

Security Police and Fire Professionals of America Retirement Fund

, argue that Goldman should not rely on its traditional method of paying out half its revenues in compensation in light of extraordinary U.S. government intervention in financial markets over the past year.

"The majority of Goldman's reported earnings for 2009 was not built on the successes and achievements of the company's employees. Instead, no less than 67% of Goldman's 2009 revenues were directly attributable to federal government intervention," stated a press release Tuesday from

Grant & Eisenhofer

, the law firm representing the funds.

"The lawsuits are completely without merit," wrote a Goldman Sachs spokesman via e-mail.

Separately, an e-mail message Tuesday from the head of a Goldman division called the Fundamental Strategies Group republished by

The New York Times' DealBook

blog stated that trading ideas distributed to clients by the group "will not give rise to any fiduciary or equitable duties."

One of the major criticisms of Goldman since the financial crisis struck has been that the firm sold mortgage securities to clients while shorting those same securities.

Such controversy is nothing new for Goldman of late, and while its shares were down more than 2% in early afternoon trading, that was less of a decline than

Bank of America

(BAC) - Get Report



(C) - Get Report


Morgan Stanley

(MS) - Get Report


JPMorgan Chase

(JPM) - Get Report


Wells Fargo

(WFC) - Get Report


Shares of all the large banks appear to be getting hammered by concerns over hearings set to begin Wednesday of the Financial Crisis Inquiry Commission, a 10-member panel set up by Congress to look into the causes of the financial crisis.

Goldman is slated to report its fourth-quarter results before the markets open on Jan. 21. The current average estimate of analysts polled by Thomson Reuters is for a profit of $5.20 a share in the December period on revenue of $9.77 billion.


Written by Dan Freed in New York