Jennifer Lee is a Partner in Orrick’s San Francisco office who focuses her practice on complex commercial litigation in the financial services industry. She defends investment banks, corporations and financial services companies and has deep knowledge of the structured finance and mortgage servicing industries, having spent nearly a decade representing financial institutions in million and billion-dollar cases arising from the fallout of the 2009 financial crisis.
Jennifer defends her clients in federal and state litigation across the country that allege fraud, breach of contract, or securities law violations. She is a key member of an Orrick trial team that has shaped the legal landscape of RMBS litigation after the 2009 financial crisis, delivering out-of-the box arguments and innovative solutions for her clients, from initial receipt of pre-litigation demands through expert work, summary judgment and trial.
Jennifer's mortgage-backed securities litigation experience, which spans the last decade, includes:
- Representing Credit Suisse Securities in multiple million and billion-dollar actions across the country brought by monoline insurers, trustees, and regulators alleging breaches of representations and warranties, fraud, and securities violations. Recent highlights include conducting direct examination of an expert witness in a trial in February 2023, and securing partial dismissal of claims in December 2023 after arguing a motion to dismiss.
- Representing Goldman Sachs in two RMBS putback actions pending in the Southern District of New York alleging that Goldman breached representations and warranties regarding the characteristics of the deal loans.
Jennifer also has significant mortgage servicing expertise, including the following matters:
- Representing Nationstar in a breach of contract dispute alleging that Nationstar failed to properly service and made misrepresentations regarding thousands of early buy-out loans.
- Representing Ocwen Mortgage Servicing in a consumer class action in the Eastern District of California alleging numerous claims including RICO, California consumer protection statutes and fraud.
Jennifer also represents financial services companies related to commercial disputes, including:
- Representing Pipe Technologies, Inc. in multiple commercial disputes regarding payment of services.
- Representing a large financial services platform in multiple subpoenas issued for production of documents.
Jennifer is dedicated to pro bono work, including asylum claims, a cause close to her heart as a child of immigrants. Prior to joining Orrick, she held a fellowship position in the Law Reform Unit at the Legal Aid Society of New York, litigating both individual cases as well as class actions.
Jennifer is a leader and advocate for diversity and inclusion initiatives in the legal profession. She leads Orrick's Diversity, Equity and Inclusion Committee in San Francisco. She has served as a fellow for the Leadership Council on Legal Diversity, and is active in the California Minority Counsel Program.
The Third Circuit Court of Appeals affirmed a trial’s court’s dismissal of IKB International SA’s claims against Wilmington Trust Co., holding that IKB had not demonstrated that Wilmington violated its contractual obligations. IKB’s breach of contract claim against Wilmington stemmed from a $168 million investment in RMBS issued by various trusts for which Wilmington served as trustee. Plaintiff’s suit against Wilmington sought money damages for breaches of contract and Wilmington’s implied “overarching duty to protect the trusts.” In affirming the dismissal, the Third Circuit held that Wilmington’s role was “primarily ministerial,” that it had only agreed to perform certain “modest functions” specifically enumerated in the Trust Agreements and that the agreements in fact shielded Wilmington from the liability asserted.
HSBC, the trustee of two securitizations at issue, successfully appealed the 2018 dismissal of its complaint alleging that DB Structured Products Inc. (DBSP), the sponsor of the two securitizations at issue, breached Mortgage Loan Purchase Agreements and Pooling and Servicing Agreements by securitizing loans in breach of representations and warranties and subsequently failing to disclose its discovery of those breaches. The trial court granted a motion to dismiss without leave to amend because it interpreted the contract language as providing that DBSP had no obligation to inform HSBC when it discovered loan-level breaches due to language in the governing agreements that DBSP notify itself of breaches. A split panel of the New York Appellate Division, First Department, reversed the trial court decision, finding that the contract was ambiguous because of the nonsensical nature of the notice provision, which required DBSP to provide notice to itself and granted HSBC leave to amend its complaint.
The Federal Deposit Insurance Corporation (FDIC) as receiver for Guaranty Bank brought claims against The Bank of New York Mellon, U.S. National Bank Association, and Citibank, N.A. alleging breach of contract, violation of the Streit Act, and violation of the Trust Indenture Act for allegedly failing to carry out their duties as trustees. Judge Carter dismissed the same claims in September of 2016 for lack of subject matter jurisdiction, holding that the FDIC lacked standing to sue because the FDIC had sold its ownership of the certificates at issue in 2010 to Wilmington Trust Co., as owner trustee, with Citibank acting in as indenture trustee. The Court had held that after that sale, the plaintiff’s claims had travelled with the securities to the resecuritized trust and thus the plaintiff no longer had standing to bring the claims it asserted. The Court had granted leave to amend the complaint to permit FDIC to resolve the standing issues by seeking ratification of the claims by the trust pursuant to FRCP 17(a)(3). After the 2016 dismissal, Wilmington Trust ratified the claims, but Citibank refused to ratify the claims without indemnity from FDIC. As a result, the standing issues remained unresolved, and the court dismissed the claims once again for lack of subject matter jurisdiction without prejudice. Decision.
Deutsche Bank settled with BlackRock and other RMBS investors in New York federal (BlackRock Balanced Capital Portfolio (Fi) v. Deutsche Bank National Trust Company, S.D.N.Y., No. 1:14-cv-09367) and California state (BlackRock Balanced Capital Portfolio (Fi) v. Deutsche Bank Trust Company Americas, Orange County Superior Court, No. 2016-00843062) suits that argued Deutsche Bank failed to fulfill its obligations as trustee of over 500 RMBS trusts valued at more than $570 billion. The settlement comes after the investors repeatedly failed to certify the cases as class actions. The settlement amount was not disclosed.
S.D.N.Y. Judge Victor Marrero granted a stay in a proposed class action that alleges that U.S. Bank as trustee improperly used money from trusts to fund its defense in an RMBS suit. Royal Park Investments filed the underlying RMBS trustee suit in 2014 (Royal Park Investments SA/NV v. U.S. Bank National Association, No. 1:14-cv-02590), alleging that U.S. Bank breached its duties as trustee. While the suit was pending, Royal Park Investments filed another suit against U.S. Bank in 2017 (Royal Park Investments SA/NV v. U.S. Bank National Association, No. 1:17-cv-06778) for misuse of trust funds to fund the underlying suit. U.S. Bank contends that indemnification clauses in the trusts’ governing documents allow it to reimburse itself for these legal expenses. Royal Park counters that legal fees are not recoverable if the relevant litigation is the result of U.S. Bank’s gross negligence. Because this gross negligence is a “central factual question” in both suits, Judge Marrero granted the stay to resolve the claim first in the underlying RMBS suit.
On July 25, 2018, U.S. Bank NA and UBS AG announced they had reached an $850 million settlement in connection with a dispute over loans in three residential mortgage-backed securities trusts. U.S. Bank filed suit against UBS in the Southern District of New York in 2012 seeking $2 billion for UBS’s alleged breach of representations and warranties about those loans. Following a three-week bench trial in 2016, U.S. District Judge P. Kevin Castel held that UBS had breached representations and warranties in certain respects and appointed special master Barbara S. Jones to review breach allegations concerning thousands of individual loans and issue a recommendation regarding liability and damages as to each loan. Order.
On June 12, 2018, the United States Securities and Exchange Commission (“SEC“) issued an Order instituting administrative proceedings, making findings, and imposing remedial sanctions against Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch“), a subsidiary of Bank of America Corporation, pursuant to Section 15(b) of the Securities Exchange Act of 1934. The SEC alleged that personnel of Merrill Lynch, acting as broker-dealers engaged in secondary market trading of non-agency RMBS, made false or misleading statements to customers between June 2009 and December 2012 that led customers to accept less or pay more for securities than they otherwise might have accepted or paid. Merrill Lynch agreed to settle the claims for approximately $16 million without admitting or denying the allegations. Order.
On June 8, 2018, monoline insurer Ambac Assurance Corporation (“Ambac“) filed a complaint in the United States District Court for the Southern District of New York against U.S. Bank National Association (“U.S. Bank“), trustee of the Harborview Mortgage Loan Trust 2005-10 (the “Trust“). The complaint alleges that U.S. Bank breached certain contractual and common law duties when it agreed to a proposed $94 million settlement of an ongoing RMBS repurchase action in New York state court against Bank of America, N.A. and certain affiliates, as successors to Countrywide Home Loans, Inc. (the “Countrywide Action“). Among other things, Ambac alleges that U.S. Bank was required to observe heightened duties of care when an Event of Default occurred under the governing PSA, and that U.S. Bank breached those duties when it agreed to settle the Countrywide Action for approximately 28% of the amount that its expert opined it was entitled to recover. Ambac further alleges that U.S. Bank breached the PSA by incorrectly accounting for recoveries received by the Trust. The complaint asserts two claims for declaratory judgments, two claims for breach of contract, and one claim for breach of fiduciary duty. Complaint.
On March 20, 2018, UBS entered into a $230 million settlement with the New York Attorney General to resolve allegations against UBS under New York’s Martin Act and Executive Law arising from the creation, packaging, structuring, underwriting, issuance, and sale of fifteen residential mortgage-backed securities sponsored by UBS in 2006 and 2007. The settlement agreement sets aside $189 million for New York homeowners and $41 million for the state, and an agreement by UBS to acknowledge certain facts relating to its alleged misconduct between 2006 and 2007. Settlement Agreement
On December 5, 2017, the First Department of the Appellate Division of the Supreme Court of New York unanimously overturned a New York Supreme Court holding that California’s statute of limitations did not bar Plaintiff’s claims. Trustee Deutsche Bank National Trust Company (“DBNTC“) had brought suit against Barclays Bank PLC and HSBC (collectively, the “Defendants“). The Defendants had moved to dismiss on the grounds that New York’s borrowing statute, CPLR 202, requires out-of-state plaintiffs to bring cases within the timeframes set forth in statutes of limitations established under both New York law and under the place “where the cause of action accrued.” Defendants argued that the suits brought by DBNTC, whose principal place of business is California, were thus barred by California’s four-year statute of limitations for contract actions. DBNTC argued that the New York choice-of-law clauses of the underlying contracts should determine the applicable statute of limitations. The First Department held that “because these provisions do not expressly incorporate the New York statute of limitations, they cannot be read to encompass that [six-year] limitation period.” Rather, “in cases where (as here) the alleged injury is purely economic,” the cause of action is deemed “to have accrued in the jurisdiction of the plaintiff’s residence.” Decision.
