Government Home loan Bank Away from Bay area v. Nationwide Economic Enterprise

A135898

The fresh demo judge finished res judicata barred Federal Financial Bank of San Francisco’s (the bank) claim facing Countrywide Economic Enterprise (Countrywide Monetary) and you may suffered Countrywide Financial’s demurrer towards the earliest amended complaint in place of get off so you can amend.

The financial institution appeals. They contends the latest legal erred by the finishing res judicata prohibited its allege against Countrywide Economic as [t]here is actually no final wisdom to your merits during the a previous action which will enjoys considering increase so you can res judicata inside step. We disagree and you may affirm. We finish the newest doctrine off res judicata pubs this new Bank’s allege facing Countrywide Monetary as the: (1) the fresh Bank’s voluntary dismissal of their claim against Nationwide Economic into the the prior action is actually a final wisdom on the deserves; and you will (2) the newest claim the financial institution dismissed inside a past suit ‘s the same cause of action while the claim it asserts up against Nationwide Economic in today’s lawsuit. That have willingly dismissed having prejudice states from handle individual wrongdoing facing certainly one of several defendants for its own strategic explanations, the lending company will most likely not prevent the res judicata effects of their decision and you may sue this new disregarded accused anew, again alleging manage-people accountability, during the dependence on brand new pendency of those same claims up against the left actors in the 1st action.

I take on due to the fact genuine the next allegations from the Bank’s amended ailment for the intended purpose of examining the transaction retaining Nationwide Financial’s demurrer:

Court regarding Desire, Very first Area, Division 5, California

When you look at the a system titled securitization, an entity originate[s] mortgages or acquires those fund and you can aggregates him or her into the a beneficial guarantee pond or financing pond on the market so you can a loan company entitled good depositor. step one The new depositor sells the brand new funds so you can a trust, which then circumstances licenses you to buyers-such as the Financial-should same day payday loans in Pine Level buy. Will ultimately ahead of , the bank ordered 95 residential mortgage-supported securities out of some securities investors from inside the 78 securitization trusts backed by residential mortgages at a high price of over $13.5 billion bucks. The bank ordered permits within the five securitizations regarding Nationwide Bonds Enterprise (Nationwide Bonds). CWALT, Inc. (CWALT) given the fresh new permits into the five securitizations. Countrywide Securities apparently awarded the new licenses about fifth securitization. dos

Within the , the financial institution sued eight bonds investors and therefore given and you may offered the fresh 95 domestic financial-recognized bonds, in addition to agencies and that granted this new certificates or managed one of the agencies you to approved this new licenses (Borrowing from the bank Suisse and/or Credit Suisse action). step 3 The new core of one’s Bank’s says try defendants made incorrect or mistaken statements inside offering records issued concerning the the fresh new home-based mortgage-recognized ties the financial institution bought.

One of several defendants when you look at the Borrowing Suisse were Nationwide Bonds Enterprise, CWALT, and you may Countrywide Financial. Given that relevant right here, the lending company so-called: (1) Nationwide Ties generated not true otherwise misleading comments on purchases away from securities inside the violation off Agencies Password sections 25401 and 25501 which have regard to securitizations 74 as a result of 78; cuatro (2) Countrywide Ties and you can CWALT produced incorrect or misleading statements inside the ticket out-of parts eleven and you can a dozen of the Bonds Operate from 1933 (sections 11 & 12) with regards to securitizations 75 courtesy 78; and you can (3) Countrywide Financial broken part fifteen of the Bonds Act (Section 15) predicated on the power over CWALT. In its Section 15 claim up against Nationwide Financial, the bank alleged CWALT existed for no mission than to located and you may deposit finance into the trusts. Under Area 15 ? Nationwide ? therefore is likely with the Bank jointly and you can severally having, and a similar the amount since the, CWALT.

Within the , the financial institution registered the problem on step ahead of us seeking to erica Enterprise (declaratory rescue action). The bank looked for a erica Agency-which had bought Countrywide’s property-try liable for any injuries Countrywide had to pay into the the credit Suisse action.