A Manhattan judge is requiring two securities class action lawyers and their law firms to pay defense costs for filing a complaint based partly on a mistaken reading of a magazine article.

Lawyers Kenneth Vianale and Jules Brody and their law firms were ordered to pay attorney fees and costs after Vianale admitted that a central allegation in the suit was based on his mistake, the New York Law Journal reports.

U.S. District Judge Denise Cote said in her opinion (PDF posted by the New York Law Journal) that the mistake and the lack of further inquiry amounted to “an act of gross negligence bordering on recklessness.”

The lawyers’ original suit had claimed that executives of Australia and New Zealand Banking Group Limited knew as early as March 2007 that the bank had loaned money to a company in financial jeopardy, yet failed to make the disclosure to shareholders. The company’s internal e-mails showed what the executives knew, the suit said.

In turns out the lawyer had misread a March 7 reference about the e-mails in an Australian magazine article to refer to March 7, 2007, instead of March 7, 2008, the story says. In an amended complaint, the reference to the e-mails was dropped and replaced with a new core allegation that the company failed to tell shareholders about its inadequate internal controls. The suit was dismissed for failure to state a claim.