On July 27, 2016, Justice Marcy Friedman of the New York Supreme Court for New York County, in accordance with other recent decisions (covered here and here) dismissed an action against UBS Real Estate Securities, Inc. The case was initially brought by Federal Housing Finance Agency (“FHFA”), as conservator of an RMBS certificateholder. It was then pursued by the trustee after the limitations period expired. Because FHFA lacked standing to bring claims for breaches of loan-level representations and warranties, the Court held that the trustee’s claims do not “relate back” to the date of FHFA’s initial filing for statute of limitations purposes. The court will permit briefing on the viability of claims for failure to notify the trustee of alleged breaches of representations and warranties. Decision.
UBS Real Estate Securities
RMBS Investors Sue U.S. Bank for Trust Losses
On August 5, 2015, RMBS investors filed a putative class action against U.S. Bank, N.A. in the Supreme Court for the State of New York. The investors assert that U.S. Bank, as trustee for the MASTR Adjustable Rate Mortgage Trust 2006-OA2, harmed certificateholders in failing to timely request repurchase of defective mortgage loans by the sponsor, UBS Real Estate Securities. The investors cite recent decisions, previously covered here and here, out of the New York federal court dismissing the trustee’s claims against U.B.S. as time-barred as to certain loans. The complaint includes claims for breach of fiduciary duty, breach of duty to avoid conflicts of interest, breach of the implied covenant of good faith and fair dealing, and violation of New York’s Streit Act. Complaint.