NY Court Dismisses Repurchase Suit Against Nomura In Part

On June 26, 2014,  Justice Friedman of the Supreme Court of the State of New York partially granted Nomura Credit & Capital Inc.’s (Nomura) motion to dismiss a repurchase suit brought by Nomura Asset Corporation Alternative Loan Trust, Series 2006-S4 (the Trust). The Trust alleged breach of contract in connection with the securitization of $254 million in mortgage loans.  The court dismissed the plaintiff’s claim for rescission and for breach of contract.  The court did not dismiss the plaintiff’s breach of contract claims based on the statute of limitations, holding that those claims accrued on the Closing Date of the transaction and were brought within six years of accrual.  The court also denied Nomura’s motion to dismiss based on the contractual sole remedy provision, holding that equitable damages for failure to repurchase loans are allowable where specific performance is unavailable.  Order.