According to Reuters, a federal court of appeals upheld the dismissal of a shareholder lawsuit accusing Freddie Mac of concealing its unstable finances and its subprime mortgage exposure prior to the financial crisis.

The 2nd U.S. Circuit Court of Appeals in New York said shareholders failed to connect their losses to the alleged inadequate disclosures by the government-controlled mortgage company and its officials, including former Chief Executive Richard Syron.

Freddie Mac lost most of its stock market value when, along with the larger Fannie Mae, it was seized by U.S. regulators in September 2008, and put into a conservatorship under the Federal Housing Finance Agency.

Shareholders led by the Illinois-based Central States, Southeast and Southwest Areas Pension Fund accused Freddie Mac of hiding its potential insolvency even after revealing a $2 billion quarterly loss on November 20, 2007.