Indymac Bancorp MBS Settlement

Indymac Bancorp MBS Settlement

Indymac Bancorp MBS Securities Settlement

The lawsuit was settled for $340 million in cash. The following is a summary of the proceedings in this lawsuit: ‘On May 14, 2009, Police and Fire Retirement System of the City of Detroit v. IndyMac MBS, Inc., et al., No. 09 Civ. 04583 (S.D.N.Y.) (the Detroit Action), was filed. On June 29, 2009, Wyoming State Treasurer, et al. v. Olinski, et al., No. 09 Civ. 05933 (S.D.N.Y.) (the Wyoming Action), was filed. By an order entered on July 29, 2009, the Court (i) consolidated the Detroit Action and the Wyoming Action under the caption In re IndyMac Mortgage-Backed Securities Litigation, Master Docket No. 09 Civ. 04583 (LAK) (S.D.N.Y.) (the Action); (ii) appointed Wyoming State Treasurer and Wyoming Retirement System as Lead Plaintiffs; and (iii) appointed Berman DeValerio as Lead Counsel for the Action. On October 9, 2009, Lead Plaintiffs filed a Consolidated Class Action Complaint. On October 29, 2009, Lead Plaintiffs filed an Amended Consolidated Class Action Complaint asserting claims under Sections 11, 12(a)(2), and 15 of the Securities Act of 1933 (the Securities Act) for alleged misrepresentations and omissions in the offering documents for IndyMac-sponsored mortgage pass-through certificates. The named plaintiffs in the Amended Consolidated Complaint were Lead Plaintiffs. The named defendants in the Amended Consolidated Complaint included Michael W. Perry, the former CEO of IndyMac Bank, F.S.B.; IndyMac MBS, Inc. and seven of its former officers and directors (Lynette Antosh, Raphael Bostic, S. Blair Abernathy, John Olinski, Samir Grover, Simon Heyrick, and Victor H. Woodworth); Fitch, Inc., The McGraw-Hill Companies, Inc. and Moody Investors Service Inc. (the Rating Agency Defendants); IndyMac Securities Corp.; and Bank of America Corporation, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman, Sachs & Co., HSBC Securities (USA) Inc., J.P. Morgan Securities Inc. (n/k/a J.P. Morgan Securities LLC), Morgan Stanley & Co., Incorporated (n/k/a Morgan Stanley & Co. LLC), RBS Securities Inc., and UBS Securities LLC. On November 23, 2009, all defendants moved to dismiss the Amended Consolidated Complaint. On February 5, 2010, the Court granted the Rating Agency Defendants motion to dismiss and entered an Order dismissing all claims against the Rating Agency Defendants. On June 21, 2010, the Court issued a Memorandum Opinion granting in part and denying in part the other defendants motions to dismiss. The Court dismissed, for lack of standing, all claims related to offerings from which Lead Plaintiffs did not purchase securities. The Court also dismissed all claims relating to three out of the four categories of alleged misrepresentations and omissions. 22. On July 7, 2010, the Court issued an Order granting in part reconsideration of its June 21, 2010 Memorandum Opinion and stating that the motions of defendants Perry, BoA, HSBC Securities (USA) Inc., Goldman Sachs & Co., Citigroup Global Markets Inc., and IndyMac Securities Corp. to dismiss the complaint against them are granted in all respects. On September 8, 2010, the Court entered a stipulated Order to clarify the June 21, 2010 Memorandum Opinion and July 7, 2010 Order to provide that Plaintiffs claims under § 11 of the [Securities] Act are dismissed with prejudice based on the statute of repose set forth in § 13 of the [Securities] Act with respect to securities issued by IndyMac INDX Mortgage Loan Trust Series 2006-AR2, IndyMac INDX Mortgage Loan Trust Series 2006-AR3, IndyMac INDX Mortgage Loan Trust Series 2006-AR4, IndyMac INDX Mortgage Loan Trust Series 2006-AR7, IndyMac INDX Mortgage Loan Trust Series 2006-AR11, and Residential Asset Securitization Trust Series 2006-A2. On December 10, 2010, Lead Plaintiffs moved for certification of a class consisting of  persons or entities who purchased or otherwise acquired beneficial interests in Certificates offered to the public in 10 Offerings” of IndyMacsponsored mortgage pass-through certificates. On August 17, 2012, the Court entered a Memorandum Opinion dismissing Lead Plaintiffs claims relating to one offering and granting Lead Plaintiffs motion for class certification with respect to investors in securities from the other nine offerings. Between May 17, 2010 and August 19, 2010, three motions to intervene were filed seeking to add named plaintiffs for claims relating to offerings from which Lead Plaintiffs did not purchase any securities. The proposed intervenors were City of Philadelphia Board of Pensions and Retirement, Los Angeles County Employees Retirement Association, Public Employees Retirement System of Mississippi, Police and Fire Retirement System of the City of Detroit, General Retirement System of the City of Detroit, and Iowa Public Employees Retirement System. On June 21, 2011, the Court issued a Memorandum Opinion granting intervention in part by City of Philadelphia Board of Pensions and Retirement, Los Angeles County Employees Retirement Association, Police and Fire Retirement System of the City of Detroit, and Public Employees Retirement System of Mississippi, and denying intervention by General Retirement System of the City of Detroit and Iowa Public Employees Retirement System. On July 20, 2011, Los Angeles County Employees Retirement Association, and Public Employees Retirement System of Mississippi dismissed with prejudice those claims for which the Court had granted them leave to intervene. Los Angeles County Employees Retirement Association, Public Employees Retirement System of Mississippi, and General Retirement System of the City of Detroit appealed the Court June 21, 2011 Memorandum Opinion to the U.S. Court of Appeals for the Second Circuit. During the pendency of the appeal, the Second Circuit issued a decision regarding class standing in NECA-IBEW Health & Welfare Fund v. Goldman Sachs & Co., 693 F.3d 145 (2d Cir. 2012) (NECA-IBEW). On June 27, 2013, the Second Circuit affirmed the Court June 21, 2011 Memorandum Opinion as to those claims and defendants as to which [Lead Plaintiffs] would lack standing under NECA-IBEW. Police and Fire Retirement System of the City of Detroit v. IndyMac MBS, Inc., 721 F.3d 95, 110 n.19 (2d Cir. 2013). The U.S. Supreme Court initially granted a petition by Public Employees Retirement System of Mississippi for writ of certiorari to appeal the Second Circuit June 27, 2013 decision; however, by order dated September 29, 2014, the U. S. Supreme Court dismissed its writ of certiorari as improvidently granted. On August 15, 2011, Lead Plaintiffs filed a Second Amended Consolidated Class Action Complaint. In addition to Lead Plaintiffs, the named plaintiffs in the Second Amended Consolidated Class Action Complaint were City of Philadelphia Board of Pensions and Retirement and Police and Fire Retirement System of the City of Detroit. On February 4, 2011, Lead Plaintiffs and Defendants Lynette Antosh and Raphael Bostic stipulated to the dismissal of Antosh and Bostic from the Action with prejudice. On September 16, 2011, the remaining defendants in the Action answered the Second Amended Consolidated Class Action Complaint. On July 26, 2012, Lead Plaintiffs filed a motion regarding a settlement for $6 million in cash with Defendants S. Blair Abernathy, John Olinski, Samir Grover, Simon Heyrick, and Victor H. Woodworth. This settlement with five individual defendants (the Individual Defendant Settlement) received final approval from the Court on December 18, 2012. Following the Individual Defendant Settlement, the remaining defendants in the Action were IndyMac MBS, Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, RBS Securities Inc., and UBS Securities LLC. On September 6, 2012, the Second Circuit issued its decision regarding class standing in NECA-IBEW. On March 18, 2013, the U.S. Supreme Court denied the petition for writ of certiorari in NECA-IBEW. On May 9, 2013, without prejudice to or waiver of any of the parties rights, including defendants right to challenge in this Court or on appeal the class standing of Lead Plaintiffs to pursue claims relating to offerings from which they did not purchase securities, Lead Plaintiffs and the remaining defendants stipulated to the reinstatement of claims relating to 36 offerings. On May 17, 2013, Lead Plaintiffs moved for the reinstatement of claims relating to an additional six offerings. On July 23, 2013, the Court granted Lead Plaintiffs motion. On April 29, 2013, Lead Plaintiffs and Defendants Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, RBS Securities Inc., and UBS Securities LLC participated in a mediation session. On August 30, 2013, Lead Plaintiffs moved for certification of an expanded class to include claims based on the additional 42 offerings the Court reinstated into this case in light of the Second Circuit decision in NECA-IBEW v. Goldman Sachs & Co., 693 F.3d 145 (2d Cir. 2012).” Lead Plaintiffs also moved for certification of six additional class representatives: City of Philadelphia Board of Pensions and Retirement, Los Angeles County Employees Retirement Association, Public Employees Retirement System of Mississippi, Police and Fire Retirement System of the City of Detroit, General Retirement System of the City of Detroit, and Iowa Public Employees Retirement System. The motion has not yet been decided by the Court. On July 18, 2014, Lead Plaintiffs and Defendants Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, RBS Securities Inc., and UBS Securities LLC participated in a second mediation session. On July 23, 2014, these parties accepted a mediator proposal to settle this Action.’

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