Federal Mortgage Bank Off Bay area v. Nationwide Economic Organization

A135898

The new demonstration judge finished res judicata barred Government Home loan Bank out of San Francisco’s (the lending company) allege against Nationwide Monetary Business (Nationwide Economic) and sustained Countrywide Financial’s demurrer on the very first amended grievance in the place of log off in order to amend.

The financial institution is attractive. They argues the new judge erred by finishing res judicata banned its claim up against Countrywide Financial since the [t]here is zero last judgment into the merits inside the a prior action that’ll keeps provided increase so you’re able to res judicata inside action. We differ and you will affirm. I stop the brand new doctrine from res judicata pubs the newest Bank’s allege against Countrywide Monetary given that: (1) this new Bank’s volunteer dismissal of the allege up against Countrywide Economic inside the previous action try a final judgment on deserves; and (2) new allege the lending company disregarded into the a previous lawsuit is the exact same cause for action since allege it asserts up against Countrywide Financial in today’s lawsuit. Having voluntarily overlooked which have prejudice states out of control person wrongdoing facing certainly several defendants for its very own proper causes, the lending company may not prevent the res judicata outcomes of the choice and you may sue the fresh new disregarded accused anew, again alleging handle-person accountability, when you look at the reliance upon this new pendency of those same says resistant to the leftover actors in the first action.

I deal with because correct another allegations throughout the Bank’s revised issue for the true purpose of examining the order sustaining Countrywide Financial’s demurrer:

Legal out of Interest, Earliest Section, Section 5, California

Inside the a process entitled securitization, an organization originate[s] mortgage loans or acquires those financing and you may aggregates him or her on a beneficial security pond or loan pool for sale so you’re able to a financial institution named good depositor. step one The latest depositor carries the fresh new fund so you can a confidence, which in turn situations permits one investors-such as the Bank-can find. At some point in advance of , the bank purchased 95 home-based mortgage-recognized ties away from certain bonds dealers when you look at the 78 securitization trusts supported by home-based mortgages at a cost more than $thirteen.5 million cash. The financial institution ordered licenses inside the five securitizations regarding Nationwide Ties Corporation (Nationwide Bonds). CWALT, Inc. (CWALT) granted the brand new permits inside the five securitizations. Countrywide Ties apparently approved the new permits on fifth securitization. dos

Inside the , the financial institution sued seven securities people and this offered and marketed this new 95 home-based mortgage-supported bonds, as well as the entities which awarded brand new certificates otherwise managed among the entities you to granted the new permits (Borrowing from the bank Suisse or perhaps the Credit Suisse step). step 3 Brand new core of your Bank’s says try defendants produced untrue or misleading comments for the providing data files granted concerning the the latest residential mortgage-supported bonds the financial institution purchased.

Among the defendants in the Borrowing Suisse have been Countrywide Ties Business, CWALT, and you can Countrywide Financial. Because related here, the lending company so-called: (1) Countrywide Securities generated not the case otherwise mistaken statements on deals off bonds for the ticket out of Agencies Password sections 25401 and 25501 with regard so you can securitizations 74 by way of 78; 4 (2) Nationwide Bonds and you can CWALT made not true or mistaken statements into the pass away from parts eleven and you will several of the Ties Act away from 1933 (areas 11 & 12) with regards to securitizations 75 by way of 78; and you can (3) Countrywide Financial broken section 15 of your own Ties Operate (Point fifteen) centered on the control over CWALT. In Point 15 claim up against Nationwide Monetary, the lending company so-called CWALT existed with no objective than to found and put financing towards the trusts. Below Area fifteen ? Nationwide ? hence is likely toward Bank as one and you will severally which have, in order to the same the total amount given that, CWALT.

When you look at the , the financial institution submitted the brand new issue throughout the step before all of us trying erica Enterprise (declaratory rescue action). The bank sought for an excellent erica Business-which had bought https://paydayloanalabama.com/prichard Countrywide’s assets-are accountable for any injuries Countrywide had to shell out within the the credit Suisse step.