On January 10, Judge Shira A. Scheindlin of the United States District Court for the Southern District of New York dismissed a lawsuit brought by U.S. Bank National Association as trustee for Lehman XS Trust, Series 2006-4N against GreenPoint Mortgage Funding, Inc. Judge Scheindlin held that the Trustee’s claims for alleged breach of representations and warranties by GreenPoint were barred by the six-year statute of limitations governing contract claims. Relying on recent authority from the Supreme Court of the State of New York Appellate Division, First Department, the court held that claims subject to cure or repurchase requirements accrue at the time of the breach and not at the time of the demand to cure or repurchase. The Court held that the trustee’s claims were untimely because they were filed more than six years from the agreement at issue. Opinion.
GreenPoint Mortgage
NY Appellate Court Holds CIFG and Syncora Lack Standing in $1.8 Billion MBS Suit
On April 25, the First Department of the Appellate Division of the New York Supreme Court affirmed an order barring monoline insurers CIFG and Syncora from suing GreenPoint Mortgage Funding for alleged violations of representations and warranties concerning loans backing $1.8 billion in RMBS securitizations. The order upheld the lower court’s denial of the insurers’ motion to file a third amended complaint, and held that the insurers could not directly assert claims against GreenPoint because they were neither parties to the relevant agreements nor intended third party beneficiaries. Decision.
GreenPoint Mortgage Sued For Fraud By CIFG
On October 1, CIFG Assurance North America filed a summons with notice against GreenPoint Mortgage Funding Inc. in the Supreme Court for the State of New York, New York County. The monoline insurer alleges that GreenPoint misrepresented the quality and characteristics of $58 million in residential mortgage loans in the pool backing $277 million in RMBS partially insured by CIFG. CIFG further alleges that GreenPoint has failed to comply with its contractual obligations to repurchase the allegedly defective loans. The insurer’s claims are for fraud, breach of contract, and specific performance. Summons with Notice.