The First Department unanimously affirmed Justice Scarpulla’s January 9, 2019, partial summary judgment order in HEMT 2006-5 et al vs. DLJ MORTGAGE CAPITAL, INC., et al, Index No. 653787/2012. Key takeaways (courtesy of Chris Milner at the Oakleaf Group):
- sampling for RMBS trustee cases just got a major boost, for both liability and damages
- Trustee able to subsequently identify additional defective loans after having put the warrantor on notice of pervasive breaches
- “Material and adverse” breaches not limited to loans in default and applies to any breach that “materially increased a loan’s risk of loss.”
- Repurchase price, as defined in the PSAs, applies to liquidated and non-liquidated loans, and thus, includes accrued interest on loans after they have been liquidated
In other news Blackrock recently settled its trustee suit against BoNYM (see here and here).