NEW YORK, Nov 2 (Reuters) - Attorneys for Brazil's state-controlled oil company, Petroleo Brasileiro SA, asked a U.S. federal appeals court on Wednesday to decertify a class of investors trying to recoup billions of dollars in losses stemming from a sprawling corruption scandal.
Petrobras, as the company is known, and its bank underwriters argued that it is not clear buyers and sellers of the company's securities, traded on exchanges all around the world, were doing transactions in the Unites States. Only securities traded in the United States can be included in the class action.
The attorneys also argued before the Second Circuit Court of Appeals in New York that the plaintiffs had failed to adequately show the news of the bribery and political kickback scandal in Brazil had a downward effect on the company's stock price.
Petrobras wants to reverse a decision made in February by lower-court Judge Jed Rakoff in Manhattan that certified two classes of plaintiffs, saying their claims are similar enough to be pursued as groups.
Class certification can make it easier for investors to recoup larger sums than if they sued individually, though it does not guarantee they will be recover.
Prosecutors in Brazil have accused former Petrobras executives of accepting more than $2 billion of bribes over a decade, mainly to from construction and engineering companies. Petrobras has said that it was a victim of the scheme by corrupt individuals.
The scandal has contributed to a plunge in Petrobras' market value to below $20 billion from nearly $300 billion fewer than eight years ago, according to Reuters data, and investors in the company want a payout.
Jeremy Lieberman, an attorney at Pomerantz representing the shareholders, argued that Rakoff's decision was correct and the district court would easily be able to "call balls and strikes" to determine who should be included and left out of the class.
He also said there was a clear link between bad news about developments in the Petrobras investigation in Brazil and a drop in share price.
One class approved by Rakoff bought various Petrobras securities from January 2010 to July 2015 and will be led by Universities Superannuation Scheme of Liverpool, England. The other bought debt securities from offerings in 2013 and 2014, and is led by North Carolina's treasurer and the Employees' Retirement System of Hawaii.
The case is In re: Petrobras Securities Litigation, U.S. District Court, Southern District of New York, No. 14-09662. (Reporting by Mica Rosenberg; Editing by Steve Orlofsky)