(Reuters) – Bank of America Corp over allegations they misled Fannie Mae and Freddie Mac
A U.S. judge on Monday ruled in favor of a federal regulator wishing to use statistical sampling in its lawsuits against big banks including Credit Suisse Group AG and Bank of America Corp over allegations they misled Fannie Mae and Freddie Mac into purchasing billions of dollars of risky mortgage debt. The lawsuits accuse the banks of misrepresenting the quality of the loans underlying the securities and violating U.S. securities laws.
The banks have denied the regulator’s allegations and argued they should be dismissed. Among the arguments by the defendants is a contention that the lawsuits were filed after the statute of limitations had expired. As some of the cases proceed to trial, FHFA has sought an easier way to determine whether the mortgages in question conformed to proper lending standards. Instead, FHFA proposed a method for sampling those loans, which it said would yield a clear analysis of potential liability without having to evaluate each loan individually. The defendants disputed FHFA’s methodology and questioned its reliability. But Cote’s ruling clears the way for FHFA to employ its sampling method as it prepares for trial in the cases, the first of which is scheduled to begin in January 2014.
The lawsuits allege impairment concerning the quality of the loans underlying the securities that do in fact violate U.S. securities laws. The consumers are yet to mount a campaign against banks for claims that carryover to regulator’s allegations concerning Securities and Exchange Commissions violations of domestic and foreign securities trading laws.
What lacks among the arguments brought by the household in claims are arguments contending the agencies negligence and joint culpability with the defendants they are suing. These lawsuits filed by agencies are proof of the lack of agency understanding essential to protecting the public from these types of harm brought to society and community as well as each homeowner. The obligations of the parties, “Seller”, “Depositors” and registrants “are substantially unperformed whereas they fail. When they fail the entire effort implodes and consolidation must take place along with a mandatory liquidation of all loans that meet the sampling criteria used to screen good from bad borrower loans.
Where either party cannot complete performance for which a consumer relied upon in a bargain, the timeing of the cessation of activities liquidation of assets by a receiver would constitute a material breach excusing the performance of the other. This is the standoff taking place amongst participating parties in the mortgage backed securities arena. The mounting interparty and counter party litigation is clearly an indication of the mis-joinder present in so many lawsuits that is never revealed in claims brought by and through plaintiff’s counsel.
The U.S. Supreme Court defined the term as a contract in which “”performance is due to some extent on both sides” N.L.R.B. v. Bildisco & Bildisco, 465 U.S. 513 (1984). In the Ninth Circuit, a contract is executory if the obligations of both parties “are so far unperformed that the failure of either party to complete performance would constitute a material breach excusing the performance of the other”
In Re Frontier Properties, Inc., 979 F.2d 1358 (9th Cir. 1992). Real property and equipment leases are perhaps the most common forms of executory contract. The lessor has a duty to provide future possession of the property and the debtor/lessee has a duty to make the future payments. Other examples might include an insurance policy, an escrow for the sale of land, a license agreement or a joint venture. Conversely, some contracts that appear to be executory, such as an installment sales contract, may already be so fully performed by the non-debtor that they are no longer executory. These contracts are often treated as unsecured claims or “disguised” security agreements subject to the applicable lien perfection rules.
for inherently deceptive, high risk, poor performing loans that are impaired at that time the consumer falls behind or defaults. The historical default is the only means of quantifying damages and sampling indicates the continuance for the borrower defaulting.