Thornburg Mortgage just moved from its old headquarters downtown into a massive new $45 million, green-built campus on Ridgetop Road.

The company may have gained some altitude, but its stock continues to decline. Thirteen months ago, the company hit a peak on the New York Stock Exchange at $140.50. As of March 9, its shares traded for a nickel on a secondary market.

Worse yet, the line of angry investors keeps getting longer.

On Feb. 27, a public pension fund in Michigan filed a class-action complaint against Thornburg in Santa Fe's 1st Judicial District Court. The plaintiff, the Genesee County Employees' Retirement System, provides pension benefits for approximately 3,000 current and former county employees.

In short, they want their money back. The class-action suit seeks compensatory and "rescissory" damages, which is legalese for putting investors back to where they were financially before they made a bad investment. Dollar figures would come out at trial, assuming the case goes that far.

In its last quarterly filing with the Securities and Exchange Commission, Thornburg Mortgage disclosed two other class-action suits against it, both of which it claims are meritless.

"These are monster cases in terms of the number of people involved and the losses," William Carpenter, an Albuquerque attorney who filed the complaint for Genesee County, says.

The complaint, which also names banks and rating agencies involved in the sale of Thornburg mortgage-backed securities, alleges that Thornburg didn't follow its own lending guidelines and failed to disclose the true riskiness of its offerings.

Thornburg has maintained that it's not like all those unscrupulous mortgage lenders. The company told SFR late last year it sold prime mortgages to creditworthy borrowers, and that its stock-price collapse was simply collateral damage from the gigantic mortgage bomb that hit the country last year.

"I don't think that's going to prove to be the case," Carpenter says.

Key to this new complaint are allegations from several "confidential witnesses" who underwrote mortgages for Thornburg, cited from another case against the company. The complaint quotes a team manager for Adfitech, a Thornburg subsidiary, as saying, "Anything goes for Thornburg loans." The company handed out loans that would not have otherwise been approved if the borrower could put up enough collateral, the complaint says.

The same anonymous manager also claims department managers "were ordered to 'get more loans out of here,' that they were 'spending too much time on details,' and that they 'would have to sacrifice something,' i.e., standards so that Thornburg could earn more revenue," according to the complaint.

Thornburg Mortgage spokeswoman Suzanne O'Leary Lopez responded to a request for comment with a written statement: "The complaint lacks merit and the Company intends to vigorously defend against these baseless allegations."

Labaton Sucharow, LLP, the New York firm handling the case for Genesee County, specializes in securities fraud. Stefanie Sundel, a Labaton Sucharow attorney on the case, declined comment, citing company policy. The firm's partner on the case, Thomas Dubbs, did not return SFR's calls. Dubbs represents the New Mexico State Investment Council in a $2.2 billion class-action suit against Broadcom Corporation, a California semiconductor maker. The firm also represents investors in cases tied to the downfall of Bear Sterns and Lehman Brothers, and is investigating possible legal action in Bernard Madoff's ponzi scheme.
A supervisor at the Genesee County Employees' Retirement System also did not return SFR's call.

This class-action suit could be the least of worries for Thornburg Mortgage's investors and employees. CEO Larry Goldstone in January told the American Banker newspaper that if Thornburg fails to meet a March 16 deadline to find $4 billion in financing, "everything would be liquidated and we'd be gone."