Government Mortgage Bank Out of San francisco bay area v. Nationwide Financial Company

A135898

The demo legal finished res judicata prohibited Federal Mortgage Bank out-of San Francisco’s (the bank) allege against Countrywide Monetary Enterprise (Nationwide Monetary) and you can suffered Nationwide Financial’s demurrer to the first amended problem instead hop out so you can amend.

The financial institution appeals. They contends the latest courtroom erred because of the finishing res judicata banned the allege facing Countrywide Economic once the [t]right here is zero last wisdom on deserves when you look at the a prior action which will keeps provided increase so you’re able to res judicata within step. I disagree and affirm. We stop brand new philosophy off res judicata pubs the newest Bank’s allege facing Countrywide Monetary due to the fact: (1) this new Bank’s voluntary dismissal of its allege against Nationwide Economic inside the earlier step try a last wisdom towards deserves; and (2) new allege the financial institution ignored into the a previous lawsuit ‘s the same cause of action since claim it claims facing Countrywide Financial in today’s lawsuit. With voluntarily dismissed that have bias claims regarding manage person wrongdoing facing among multiple defendants for its own strategic reasons, the lending company may well not prevent the res judicata consequences of the choice and you can sue the latest disregarded accused anew, once more alleging control-people liability, during the reliance upon the fresh pendency of those same says contrary to the kept actors in the 1st action.

I undertake because real another allegations in the Bank’s amended criticism for the purpose of examining the order sustaining Nationwide Financial’s demurrer:

Legal off Desire, Earliest Region, Department 5, California

Inside the a system titled securitization, an entity originate[s] mortgage loans or acquires those fund and you may aggregates her or him on the a good collateral pool or financing pond obtainable so you’re able to a financial institution called an excellent depositor. 1 The brand new depositor deal the brand new financing to a believe, which then issues certificates one to buyers-for instance the Bank-can purchase. Will ultimately ahead of , the lending company bought 95 residential financial-backed securities out of individuals securities buyers when you look at the 78 securitization trusts backed by residential mortgage loans at a high price more than $thirteen.5 billion bucks. The lending company purchased licenses in the four securitizations off Nationwide Ties Firm (Countrywide Securities). CWALT, Inc. (CWALT) given the latest certificates within the five securitizations. Countrywide Ties appear to given the brand new licenses in the fifth securitization. 2

During the , the bank charged seven securities dealers and that offered and you can ended up selling the brand new 95 home-based financial-supported bonds, together with organizations and this given the brand new licenses or managed one of several entities you to given the fresh new licenses (Borrowing from the bank Suisse or even the Credit Suisse step). step 3 The fresh core of Bank’s states are defendants generated untrue otherwise misleading comments when you look at the offering records awarded about the the newest residential financial-recognized ties the lending company ordered.

One of the defendants in the Borrowing from the bank Suisse was basically Countrywide Ties Firm, CWALT, and you can Countrywide Monetary. As the associated right here, the lending company so-called: (1) Nationwide Securities produced incorrect otherwise mistaken comments regarding the income away from securities inside the pass from Corporations Password sections 25401 and you may 25501 that have admiration so you’re able to securitizations 74 through 78; cuatro (2) Nationwide Bonds and CWALT produced not the case or mistaken statements in violation from areas 11 and you may a dozen of Bonds Act payday loans Nixburg,AL of 1933 (sections eleven & 12) with respect to securitizations 75 as a consequence of 78; and you may (3) Countrywide Monetary violated section fifteen of your own Ties Act (Area fifteen) based on their control over CWALT. In Area 15 claim up against Nationwide Economic, the lending company alleged CWALT resided with no purpose rather than located and you may deposit financing into trusts. Below Part 15 ? Nationwide ? therefore is likely with the Lender jointly and you will severally that have, and also to a similar the quantity as, CWALT.

Inside the , the bank recorded the brand new ailment from the action in advance of us seeking to erica Company (declaratory relief step). The financial institution sought for good erica Organization-which in fact had ordered Countrywide’s possessions-are responsible for one damages Countrywide needed to spend within the the credit Suisse step.