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IN RE: BALDERRAMA | 2nd allonge includes an endorsement from RFC (Judy Faber) to Deutsche that did not exist in the first allonge…3 different Promissory Notes

IN RE: BALDERRAMA | 2nd allonge includes an endorsement from RFC (Judy Faber) to Deutsche that did not exist in the first allonge…3 different Promissory Notes

**Judy Faber has a history on this site and named in some important cases…check it out!

 

UNITED STATES BANKRUPTCY COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION

In re
MARIA RENEE BALDERRAMA
Debtor.

CARLA P. MUSSELMAN, TRUSTEE
Plaintiff,

vs.

DEUTSCHE BANK TRSUTE COMPANY
AMERICAS, in trust for Residential
Accredit Loans, Inc. Mortgage Asset-
Backed Pass-Through Certificates, Series
2007-QH5,
Defendant.

MEMORANDUM OPINION PARTIALLY GRANTING AND
PARTIALLY DENYING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT
AND DENYING PLAINTIFF’S CROSS MOTION FOR SUMMARY JUDGMENT

EXCERPT:

In response, the trustee filed her own cross motion for summary judgment arguing the
various documents Deutsche has provided to support its position, including three different
versions of the note and two versions of the allonge, were ineffective to transfer any interest to
Deutsche and evidence Deutsche‘s bad faith in purporting to own the note.17 The trustee‘s
argument primarily is based on the second allonge provided by Deutsche upon the Court‘s order
compelling discovery. The second allonge includes an endorsement from RFC to Deutsche that
did not exist in the first allonge, and, according to the trustee, Deutsche caused this endorsement
to be made fraudulently to meet the needs of litigation.18 The trustee urges the Court to find
Deutsche has not adequately explained the discrepancies between the two allonges, has not met
its burden to prove it is the legitimate owner of the note, and title to the Property should vest in
the trustee.

[…]

Neither version of the allonge, however, includes dates of the alleged transfers as stated
by Ms. Faber. Even assuming she had the authority to endorse the note to Deutsche, Ms. Faber
does not explain why RFC initially failed to produce the second allonge with the RFC
endorsement in its motion to lift stay, even though it allegedly existed at that time. These ?holes?
present substantial questions of fact as to Deutsche‘s good faith and the second allonge‘s
authenticity. The Court cannot avoid suspecting that the second allonge indeed was created
solely to rebut the trustee‘s assertions in this litigation and did not previously exist. If so, the
Court suggests Deutsche and Ms. Faber individually consider the possible consequences of
propounding potentially false evidence and perjured testimony to the Court.

[ipaper docId=81975432 access_key=key-1kab3johohtn0eshfdqc height=600 width=600 /]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in STOP FORECLOSURE FRAUD1 Comment

In RE: BASS | North Carolina Appeals Court Affirms U.S. Bank c/o Wells Fargo ‘Judy Faber’s Invalid Stamp Indorsement, Not the legal holder of a promissory note’

In RE: BASS | North Carolina Appeals Court Affirms U.S. Bank c/o Wells Fargo ‘Judy Faber’s Invalid Stamp Indorsement, Not the legal holder of a promissory note’

NORTH CAROLINA COURT OF APPEALS

In the Matter of the foreclosure
of a Deed of Trust executed by
Tonya R. Bass in the original
amount of $139,988.00 dated
October 12, 2005, recorded in Book
4982, Page 86, Durham County
Registry,

Substitute Trustee Services, Inc.,
as Substitute Trustee,

Appeal by Petitioner from order entered 14 September 2010
by Judge Abraham Penn Jones in Durham County Superior Court.
Heard in the Court of Appeals 27 October 2011.

K&L Gates, LLP, by A. Lee Hogewood, III and Brian C. Fork,
for Petitioner-appellant.

Legal Aid of North Carolina, Inc., by E. Maccene Brown,
Gregory E. Pawlowski, John Christopher Lloyd, and Andre C.
Brown, for Respondent-appellee.

HUNTER, JR., Robert N., Judge.

U.S. Bank, National Association, as Trustee, c/o Wells
Fargo Bank, N.A. (“Petitioner”) appeals the trial court’s order
dismissing foreclosure proceedings against Respondent Tonya R.
Bass. Petitioner assigns error to the trial court’s
determination that Petitioner is not the legal holder of a
promissory note executed by Respondent and therefore lacks
authorization to foreclose on Respondent’s property securing the
note under a deed of trust. After careful review, we affirm.

Excerpt:

Furthermore, Comment 1 to North Carolina General Statutes
§ 25-3-308 defines “presumed” to mean “that until some evidence
is introduced which would support a finding that the signature
is forged or unauthorized, the plaintiff is not required to
prove that it is valid.” Id. In contrast to the stamp at
issue, a handwritten signature accompanies each of the other
stamps on the Note introduced by Petitioner before the trial
court. The stamp purporting to transfer the Note from
Residential to Petitioner, for example, bears the apparent
handwritten signature of Judy Faber, identified as Residential’s
vice president. This signature provides at least some evidence
that this stamp was executed with the requisite intent and
authority. Whether a stamp bearing an apparent handwritten
signature is sufficient competent evidence of the purported
indorsement, however, is not before this Court as Respondent
challenges the only stamp without a handwritten signature. The
omission of a handwritten signature with respect to the
challenged stamp is competent evidence from which the trial
court could conclude that this particular stamp was not executed
by an authorized individual and is therefore facially invalid
indorsement. Thus, even if Respondent had failed to object to
the stamp, which it did not, the burden properly remained upon
Petitioner to prove its validity.

[ipaper docId=75081797 access_key=key-1zz3byrbex3zpcm5knnv height=600 width=600 /]

MUST READ:

FULL_DEPOSITION_OF_GMAC_JUDY_FABER

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in STOP FORECLOSURE FRAUD0 Comments

Full Deposition of Residential Funding/GMAC JUDY FABER: US BANK v. Cook

Full Deposition of Residential Funding/GMAC JUDY FABER: US BANK v. Cook

Make sure you read this carefully…This is a transcript of an employee of Residential Funding Company who is in charge of record keeping of original documents. Don’t miss the full deposition down below.

Follow the assets, don’t get lost in the trail…

17 Q. Now, when you said you’re the Director of
18 Records Management for the Minnesota office?

19 A. Uh-huh.

20 Q. Are there other offices of Residential
21 Funding that maintain records that you are
22 not responsible for?

23 A. There are records services sites in Iowa and
24 in Pennsylvania. Those deal mostly with the
25 GMAC mortgage assets.

<snip>

11 Q. And what, if anything, is your responsibility
12 with regard to those records?

13 A. To track the physical paper for those
14 assets — or that asset.

15 Q. Are you what you consider to be the keeper of
16 the records for those documents?

17 A. Sure, yep.

5 Q. Okay. And then when somebody wants to view
6 specific records from your system, is that
7 something that you’re responsible for
8 obtaining as part of your day-to-day
9 responsibilities?

10 A. The people that report to me, yes, or the
11 vendor that — that we have retained to do
12 those functions, yes. I don’t do that
13 myself.

14 Q. Who’s the vendor that you retain to do that?

15 A. A company called ACS.

16 Q. ACS?

17 A. Yep.

18 Q. And what does ACS do with regard to the
19 records?

20 A. They fulfill the request. So if somebody
21 needs a credit folder or a legal folder, they
22 research where those documents are, obtain
23 the documents and then provide that requestor
24 with either the paper documents or images.

<snip>

21 Q. There’s a file folder that shows it came from
22 the outside vendor?

23 A. Yes. Their sticker is affixed to the front
24 of the folder, so I know it came from them.

25 Q. Okay. And then is there anything on the
1 documents themselves that show where they
2 came from?

3 A. No.

4 Q. And by the outside vendor, do you mean ACS?

5 A. No. Actually, the vendor that stores the
6 actual folder is Iron Mountain.

7 Q. So there’s a sticker on that file that shows
8 it came from Iron Mountain?

9 A. Correct, yes.

10 Q. Does Iron Mountain maintain your system or do
11 they just maintain hard copies of documents?

12 A. They maintain the hard copies of the
13 documents.

14 Q. Not any records on your computer system,
15 correct?

16 A. No.

17 Q. Is that correct?

18 A. Correct.

<snip>

18 Q. What’s the relationship between Residential
19 Funding Company, LLC and U.S. Bank National
20 Association?

21 A. In — in this instance, U.S. Bank is the
22 trustee on the security that this loan is in.
23 And RFC was the issuer of the security that
24 was created.

25 Q. Who was the issuer of the security?

1 A. RFC was the issuer of the security.

2 Q. Oh, RFC is what you call Residential Funding
3 Company?

4 A. Yes.

5 Q. So RFC issued the security?

6 A. Right.

7 Q. Can you explain to me what that means?

8 A. No, I can’t.

9 Q. Okay. How do you know RFC issued the
10 security?

11 A. It’s the normal course of business as to how
12 our — our business works. RFC is in the
13 business of acquiring assets and putting them
14 together into securities to sell in the — in
15 the market.

16 MR. SHAW: I would like to
17 register a general objection to this line of
18 questioning. There’s not been a foundation
19 laid for Judy Faber being competent to reach
20 some of these conclusions that are being
21 stated on the record.

22 BY MR. HOLLANDER:
23 Q. So in this particular instance, do you have
24 any personal knowledge of the relationship
25 between RFC and U.S. Bank National
1 Association as trustee?

2 A. No.

3 Q. For whom is U.S. Bank National Association
4 acting as the trustee?

5 A. I believe it would be for the investors of
6 the — that have bought the securities.

7 Q. I’m sorry. Something happened with the phone
8 and I didn’t hear your answer. I’m sorry.

9 A. I believe it would be for the different
10 investors who have bought pieces of that
11 security that was issued.

12 Q. Are there different investors that have
13 purchased the Peter Cook note?

14 A. I don’t think I’m qualified to answer that.
15 You know, I can tell you from what my basic
16 understanding is from the process, but I’m
17 not an expert.

18 MR. SHAW: Once again, I’d like to
19 raise a continuing general objection that she
20 being — testifying with respect to what her
21 job is, and I believe you’re getting into
22 areas that is other than what her job is and
23 you’re asking for possibly even legal
24 conclusions here. So I would like to raise
25 that objection again.

[…]

[ipaper docId=39156662 access_key=key-hxfsobk1503f3iza8sn height=600 width=600 /]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in assignment of mortgage, bifurcate, conspiracy, deposition, foreclosure, foreclosure fraud, foreclosures, GMAC, mbs, securitization, STOP FORECLOSURE FRAUD, trade secrets, trustee, Trusts, us bank2 Comments

BLACKROCK ALLOCATION TARGET SHARES: SERIES S PORTFOLIO v. WELLS FARGO BANK, N.A. |  SDNY – Plaintiffs claim that Defendant discovered pervasive documentation errors, breaches of seller representations and warranties (“R&Ws”), and systemic loan-servicing violations, but disregarded its contractual obligations to protect Plaintiffs therefrom because, among other consequences, doing so would have exposed Defendant to liability for its own RMBS-related misconduct

BLACKROCK ALLOCATION TARGET SHARES: SERIES S PORTFOLIO v. WELLS FARGO BANK, N.A. | SDNY – Plaintiffs claim that Defendant discovered pervasive documentation errors, breaches of seller representations and warranties (“R&Ws”), and systemic loan-servicing violations, but disregarded its contractual obligations to protect Plaintiffs therefrom because, among other consequences, doing so would have exposed Defendant to liability for its own RMBS-related misconduct

 

BLACKROCK ALLOCATION TARGET SHARES: SERIES S PORTFOLIO, et al., Plaintiffs,
v.
WELLS FARGO BANK, NATIONAL ASSOCIATION, et al., Defendants.
ROYAL PARK INVESTMENTS SA/NV, Individually and on Behalf of all Others Similarly Situated, Plaintiffs,
v.
WELLS FARGO BANK, N.A, as Trustee, Defendant.
NATIONAL CREDIT UNION ADMINISTRATION BOARD, as Liquidating Agent of U.S. Central Federal Credit Union, Western Corporate Federal Credit Union, Members United Corporate Federal Credit Union, Southwest Corporate Federal Credit Union, and Constitution Corporate Federal Credit Union, Plaintiff,
v.
WELLS FARGO BANK, NATIONAL ASSOCIATION, Defendant. and
NCUA GUARANTEED NOTES TRUST 2010-R1, NCUA GUARANTEED NOTES TRUST 2010-R2, NCUA GUARANTEED NOTES TRUST 2010-R3, NCUA GUARANTEED NOTES TRUST 2011-R2, NCUA GUARANTEED NOTES TRUST 2011-R4, NCUA GUARANTEED NOTES TRUST 2011-R5, and NCUA GUARANTEED NOTES TRUST 2011-M1, Nominal Defendants.
PHOENIX LIGHT SF LIMITED, et al., Plaintiffs,
v.
WELLS FARGO BANK, N.A., Defendant.
COMMERZBANK AG, Plaintiffs,
v.
WELLS FARGO BANK N.A., Defendant.

Nos. 14 Civ. 9371 (KPF) (SN), 14 Civ. 9764 (KPF) (SN), 14 Civ. 10067 (KPF) (SN), 14 Civ. 10102 (KPF) (SN), 15 Civ. 10033 (KPF) (SN)
United States District Court, S.D. New York.
March 30, 2017.
Amherst Advisory & Management, LLC, represented by Gayle Rosenstein Klein, McKool Smith.

Amherst Advisory & Management, LLC, represented by Elisa Lee, New York City Law Department.

Blackrock Allocation Target Shares: Series S Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Jai Kamal Chandrasekhar, Bernstein Litowitz Berger & Grossmann LLP, Jeroen Van Kwawegen, Bernstein Litowitz Berger & Grossmann LLP, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, Brett M. Middleton, Bernstein Litowitz Berger & Grossmann LLP, David R. Kaplan, Bernstein Litowitz Berger & Grossmann LLP, Lucas E. Gilmore, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP, Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP & Timothy Alan DeLange, Bernstein Litowitz Berger & Grossmann LLP.

Blackrock Core Bond Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Jai Kamal Chandrasekhar, Bernstein Litowitz Berger & Grossmann LLP, Jeroen Van Kwawegen, Bernstein Litowitz Berger & Grossmann LLP, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, Brett M. Middleton, Bernstein Litowitz Berger & Grossmann LLP, David R. Kaplan, Bernstein Litowitz Berger & Grossmann LLP, Lucas E. Gilmore, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP, Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP & Timothy Alan DeLange, Bernstein Litowitz Berger & Grossmann LLP.

Kore Advisors, L.P., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Brookfield Mortgage Opportunity Income Fund Inc., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

MILLERTON ABS CDO LTD., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Prudential Bank & Trust, FSB, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Prudential Retirement Insurance and Annuity Company, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Prudential Trust Company, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

The Gilbraltar Life Insurance Company, Ltd., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

The Prudential Insurance Company of America, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

THE PRUDENTIAL INVESTMENT PORTFOLIOS 2;, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

THE PRUDENTIAL INVESTMENT PORTFOLIOS 9, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

THE PRUDENTIAL INVESTMENT PORTFOLIOS INC., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

THE PRUDENTIAL INVESTMENT PORTFOLIOS, INC. 17, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

THE PRUDENTIAL SERIES FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

TIAA GLOBAL PUBLIC INVESTMENTS, MBS LLC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

TIAA-CREF Life Insurance Company, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

CREF BOND MARKET ACCOUNT, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

CREF SOCIAL CHOICE ACCOUNT, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

TIAA-CREF BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

TIAA-CREF BOND PLUS FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

TIAA-CREF LIFE BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

TIAA-CREF SHORT-TERM BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

TIAA-CREF Social Choice Bond Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK COREALPHA BOND FUND E, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK COREALPHA BOND MASTER PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK COREPLUS BOND FUND B, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK DYNAMIC HIGH INCOME – STRUCTURED CREDIT PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Blackrock Enchanted Government Fund, Inc., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK FIXED INCOME GLOBALALPHA MASTER FUND LTD., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK INCOME TRUST, INC., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK LONG DURATION ALPHAPLUS BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK MASTER TOTAL RETURN PORTFOLIO OF MASTER BOND LLC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK MULTI-SECTOR INCOME TRUST, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Blackrock Strategic Income Oppurtunities Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK TOTAL RETURN PORTFOLIO (INS- SERIES), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

BLACKROCK US MORTGAGE, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

AST PIMCO TOTAL RETURN BOND PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Fixed Income Shares (Series R), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

FIXED INCOME SHARES: SERIES C, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

FIXED INCOME SHARES: SERIES LD, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Fixed Incomes Shares: Series M, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

FIXED INCOME SHARES: SERIES M, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

LVS I LLC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

LVS II LLC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PACIFIC BAY CDO, LTD., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PCM Fund, Inc., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO ABSOLUTE RETURN STRATEGY 3D OFFSHORE FUND LTD., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Absolute Return Strategy II Master Fund LDC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO ABSOLUTE RETURN STRATEGY III MASTER FUND LDC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO ABSOLUTE RETURN STRATEGY IV IDF LLC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO ABSOLUTE RETURN STRATEGY IV MASTER FUND LDC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO ABSOLUTE RETURN STRATEGY V MASTER FUND LDC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO BERMUDA TRUST II: PIMCO BERMUDA INCOME FUND (M), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Bermuda Trust IV: Pimco Bermuda Global Bond Ex-Japan Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO BERMUDA TRUST: PIMCO EMERGING MARKETS BOND FUND (M), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CAYMAN SPC LIMITED: PIMCO CAYMAN GLOBAL AGGREGATE BOND SEGREGATED PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CAYMAN SPC LIMITED: PIMCO CAYMAN JAPAN COREPLUS SEGREGATED PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CAYMAN SPC LIMITED: PIMCO CAYMAN JAPAN COREPLUS STRATEGY SEGREGATED PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CAYMAN SPC LIMITED: PIMCO CAYMAN JAPAN LOW DURATION SEGREGATED PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Cayman SPC Limited: Pimco Cayman Unconstrained Bond Segregated Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CAYMAN TRUST: PIMCO CAYMAN GLOBAL AGGREGATE BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CAYMAN TRUST: PIMCO CAYMAN GLOBAL AGGREGATE EX-JAPAN (YEN-HEDGED) BOND FUND II, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CAYMAN TRUST: PIMCO CAYMAN GLOBAL AGGREGATE EX-JAPAN BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Cayman Trust: Pimco Cayman Global Ex-Japan (Yen- hedged) Bond Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO COMBINED ALPHA STRATEGIES MASTER FUND LDC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Corporate & Income Oppurtunity Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO CORPORATE & INCOME STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Distressed Senior Credit Oppurtunites Fund II, L.P., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO DYNAMIC CREDIT INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO DYNAMIC INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Equity Series: Pimco Balanced Income Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco ETF Trust: Pimco Enchanced Short Maturity Active Exchange-Traded Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO ETF TRUST: PIMCO LOW DURATION ACTIVE EXCHANGE-TRADED FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco ETF Trust: Pimco Total Return Active Exchange-Traded Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP, Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP, Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP, Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP, Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, DIVERSIFIED INCOME DURATION HEDGED FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, DIVERSIFIED INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, EMERGING LOCAL BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Global Investors Series Plc, emerging markets bond funds, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, EURO BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, EURO INCOME BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, GLOBAL ADVANTAGE REAL RETURN FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, GLOBAL BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, GLOBAL INVESTMENT GRADE CREDIT FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, INFLATION STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, PIMCO CREDIT ABSOLUTE RETURN FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, PIMCO DIVIDEND AND INCOME BUILDER FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Global Investors Series PLC, Stockplus Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, STRATEGIC INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, TOTAL RETURN BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: GLOBAL INVESTORS SERIES PLC, UNCONSTRAINED BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO COMMODITIESPLUS STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO COMMODITY REAL RETURN STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO CREDIT ABSOLUTE RETURN FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO DIVERSIFIED INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO EM FUNDAMENTAL INDEXPLUS AR STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO EMERGING LOCAL BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO EMG INTL LOW VOLATILITY RAFI-PLUS AR FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO FLOATING INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO FOREIGN BOND FUND (U.S. DOLLAR-HEDGED), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO FOREIGN BOND FUND (UNHEDGED), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO FUNDAMENTAL ADVANTAGE ABSOLUTE RETURN STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO GLOBAL ADVANTAGE STRATEGY BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco Global Bond Fund (U.S. Dollar- Hedged), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO GLOBAL BOND FUND (UNHEDGED), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO GLOBAL MULTI-ASSET FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO INTERNATIONAL FUNDAMENTAL INDEXPLUS AR STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco International Stockplus AR Strategy Fund (U.S. Dollar- Hedged), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco International Stockplus AR Strategy Fund (Unhedged), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO INTL LOW VOLATILITY RAFI-PLUS AR FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO INVESTMENT GRADE CORPORATE BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO LONG DURATION TOTAL RETURN FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO LONG-TERM CREDIT FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco Long–Term U.S. Government Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO LOW DURATION FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO LOW DURATION FUND II, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO LOW DURATION FUND III, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO LOW VOLATILITY RAFI- PLUS AR FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO MODERATE DURATION FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO MORTGAGE OPPORTUNITIES FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO REAL ESTATE REAL RETURN STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco Real Return Asset Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO REAL RETURN FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO SHORT-TERM FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco Small Cap Stockplus AR Strategy Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO SMALL COMPANY FUNDAMENTAL INDEXPLUS AR STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco Stockplus Absolute Return Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Pimco Stockplus AR Short Strategy Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO TOTAL RETURN FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO TOTAL RETURN FUND II, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO TOTAL RETURN FUND III, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO TOTAL RETURN FUND IV, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO UNCONSTRAINED BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO UNCONSTRAINED TAX MANAGED BOND FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PIMCO WORLDWIDE FUNDAMENTAL ADVANTAGE AR STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PRIVATE ACCOUNT PORTFOLIO SERIES ASSET-BACKED SECURITIES PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PRIVATE ACCOUNT PORTFOLIO SERIES DEVELOPING LOCAL MARKETS PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Private Account Porfolio Series Emerging Markets Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Private Account Portfolio Series high Yield Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PRIVATE ACCOUNT PORTFOLIO SERIES INTERNATIONAL PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PRIVATE ACCOUNT PORTFOLIO SERIES MORTGAGE PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Funds: Private Account Portfolio Series Real Return Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PRIVATE ACCOUNT PORTFOLIO SERIES SHORT-TERM PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO FUNDS: PRIVATE ACCOUNT PORTFOLIO SERIES U.S. GOVERNMENT SECTOR PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO GLOBAL CREDIT OPPORTUNITY MASTER FUND LDC, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Global Income Oppertunities Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO GLOBAL STOCKSPLUS & INCOME FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco High Income Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Income Oppertunity Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO INCOME STRATEGY FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO INCOME STRATEGY FUND II, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO LARGE CAP STOCKSPLUS ABSOLUTE RETURN FUND, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO MULTI-SECTOR STRATEGY FUND LTD., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Offshore Funds- Pimco Absolute Return Strategy IV Efund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Offshore Funds: Pimco Absolute Strategy V Alpha Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Real Return Strategy Fund, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO STRATEGIC INCOME FUND, INC., Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Tactical Oppertunities Master Fund LTD, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO COMMODITY REAL RETURN STRATEGY PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO EMERGING MARKETS BOND PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO FOREIGN BOND PORTFOLIO (U.S. DOLLAR HEDGED), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO GLOBAL ADVANTAGE STRATEGY BOND PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO GLOBAL BOND PORTFOLIO (UNHEDGED), Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Variable Insurance Trust: Pimco Long Term U.S. Government Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO LOW DURATION PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Low Duration Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO REAL RETURN PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Variable Insurance Trust: Pimco Short-Term Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

PIMCO VARIABLE INSURANCE TRUST: PIMCO TOTAL RETURN PORTFOLIO, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Pimco Variable Insurance Trust: Pimco Unconstrained Bond Portfolio, Plaintiff, represented by Blair Allen Nicholas, Bernstein Litowitz Berger & Grossman, LLP, pro hac vice, Benjamin Galdston, Bernstein Litowitz Berger & Grossmann LLP, Niki L. Mendoza, Bernstein, Litowitz, Berger & Grossmann, LLP, Rachel Felong, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Royal Park Investments SA/NV, Consolidated Plaintiff, represented by Robert Steven Trisotto, Bernstein Litowitz Berger & Grossman LLP.

Wells Fargo Bank, National Association, Defendant, represented by Jayant W. Tambe, Jones Day, Allison Fuller, Jones Day, Amanda Leigh Dollinger, Jones Day, Chris Waidelich, Jones Day, Dennis Michael Slater, Fried, Frank, Harris, Shriver & Jacobson LLP, Eric Peter Stephens, Jones Day, Harold Keith Gordon, Jones Day, Howard Fredrick Sidman, Jones Day, Jason Jurgens, Jones Day, Jeffrey Baltruzak, Jones Day, Joseph James Boylan, Jones Day, Katherine Lyons Wall, Jones Day, Michael James Dailey, Jones Day, Michael O. Thayer, Jones Day, Paul Bartholomew Green, Jones Day, Rebekah B. Kcehowski, Jones Day, Robert Harrison Golden, Jones Day, Sevan Ogulluk, Jones Day, Thomas E. Lynch, Jones Day, Traci Leigh Lovitt, Jones Day & Tracy V. Schaffer, Jones Day.

OPINION AND ORDER

KATHERINE POLK FAILLA, District Judge.

In the near-decade since the collapse of the United States real-estate market, this District has been inundated with lawsuits brought by putative victims of that collapse against those they blame for it. As time has lapsed, and with it various statutes of limitation, the targets of these lawsuits — as well as the proffered bases of liability — have evolved. The instant cases represent the latest wave: They are brought by and on behalf of certificateholders (“Plaintiffs”) of 53 residential-mortgage-backed securities (“RMBS”) trusts (the “Trusts”) against the Trusts’ common Trustee, Wells Fargo Bank, National Association (“Wells Fargo” or “Defendant”). Plaintiffs allege that Defendant failed to discharge its duties as Trustee. More specifically, Plaintiffs claim that Defendant discovered pervasive documentation errors, breaches of seller representations and warranties (“R&Ws”), and systemic loan-servicing violations, but disregarded its contractual obligations to protect Plaintiffs therefrom because, among other consequences, doing so would have exposed Defendant to liability for its own RMBS-related misconduct.

Defendant has moved to dismiss each of the above-captioned related actions for failure to state a claim.[1] For the reasons set forth below, Defendant’s motion is granted in part and denied in part. In brief, Defendant’s motion to dismiss Plaintiffs’ breach of contract claims is denied; its motion to dismiss Plaintiffs’ tort claims is granted in part and denied in part; its motion to dismiss Plaintiffs’ claims under the Trust Indenture Act is granted in part and denied in part; its motion to dismiss Plaintiffs’ claims under the Streit Act is granted; its motion to dismiss Plaintiff NCUAB’s derivative claims is granted without prejudice to NCUAB’s ability to move for leave to replead; its motion to dismiss NCUAB’s direct claims is denied; and its motion to dismiss Commerzbank’s claims on timeliness grounds is denied.

BACKGROUND[2]

A. Factual Background

Explanations of the typical formation process and structure of RMBS trusts abound in this District, and this Court will not here reinvent the wheel. Only a brief description is provided for context. See also BlackRock Allocation Target Shares v. Wells Fargo Bank, Nat’l Ass’n, No. 14 Civ. 9371 (KPF) (SN), 2017 WL 953550, at *1-3 (S.D.N.Y. Mar. 10, 2017) (describing the background of this consolidated action).

1. RMBS Trusts Generally

The Trusts in the instant action were originally securitized by residential mortgage loans, and created to facilitate the sale of those loans to investors. (BR Compl. ¶¶ 3-4).[3] Such RMBS Trusts are formed according to the following process: First, institutions known as “sponsors” or “sellers” acquire and pool residential mortgage loans. (Id. at ¶¶ 5, 43). Each sponsor also selects the loans’ “servicer,” “often an affiliate of the seller or originator, to collect payments on the loans.” (Id. at ¶ 5). “Once the loans are originated, acquired and selected for securitization, the seller, through an affiliate called the depositor, creates a trust where the loans are deposited for the benefit of the Noteholders.” (Id.). Then the depositor “segments the cash flows and risks in the loan pool among different levels of investment or `tranches.'” (Id. at ¶ 44). Typically, “cash flows from the loan pool are applied in order of seniority, going first to the most senior tranches[,] [and] . . . any losses to the loan pool due to defaults, delinquencies, foreclosure or otherwise, are applied in reverse order of seniority.” (Id.). Next, “the depositor conveys the mortgage pool to the trust in exchange for the transfer of the RMBS to the depositor.” (Id. at ¶ 45). “Finally, the depositor sells the RMBS to an underwriter, and provides the revenue from the sale to the seller. The underwriter markets and sells the RMBS to investors.” (Id. at ¶ 46).

It is the sponsor-selected servicer’s responsibility to collect loan principal and interest (“P&I”) payments from the underlying borrowers. (BR Compl. ¶ 47). “After collection, the servicer sends the funds to the trust, which then makes payments to the noteholders. Mortgage delinquencies and defaults reduce the available P&I payments to be paid to the trust and passed through to investors.” (Id.). Therefore, “proper loan origination and underwriting of the mortgages underlying the RMBS, and proper and timely loan servicing and oversight” are of critical importance to investors, directly dictating their timely receipt of passed-through payments. (Id. at ¶ 48).

2. The Trusts, the Governing Agreements, and Defendant’s Duties Thereunder

The 53 Trusts at issue here are of two kinds: Pooling and Service Agreement (“PSA”) Trusts and Indenture Trusts.[4] 41 of the 53 Trusts at issue in this case are PSA Trusts. (Def. Br. 5). PSA Trusts “are organized under New York [common] law.” Ret. Bd. of Policemen’s Annuity & Benefit Fund of City of Chi. v. Bank of N.Y. Mellon (hereinafter, “PABF III“), 775 F.3d 154, 156 (2d Cir. 2014). In a PSA trust, “[t]he right to receive trust income is parceled into certificates and sold to investors,” who are called “certificateholders.” Id. (quoting BlackRock Fin. Mgmt. Inc. v. Segregated Account of Ambac Assurance Corp. (hereinafter, “Ambac“), 673 F.3d 169, 173 (2d Cir. 2012)). “The terms of the securitization trusts as well as the rights, duties, and obligations of the trustee, seller, and servicer are set forth in [governing agreements, frequently styled as PSAs].” Id. (alteration in original) (quotation mark omitted) (quoting Ambac, 673 F.3d at 173).

12 of the 53 Trusts at issue in this case are Indenture Trusts. (Def. Br. 5). Indenture Trusts are governed by their Trust Agreements, Mortgage Loan Purchase and Sale Agreements (“MPLAs”), and Sale and Service Agreements (“SSAs”). (See BR Compl. ¶ 49). See generally BlackRock Allocation Target Shares, 2017 WL 953550, at *1-3. As Defendant explains,

Indenture Trusts differ from PSA Trusts in that the Depositor conveys ownership of the pooled loans to the Issuer, which in turn issues its own notes pursuant to the indenture. Under the indenture, the Issuer collateralizes the notes by pledging the mortgage loans to the indenture trustee, which holds the pledge on behalf of the noteholders.

(Def. Br. 5).

The PSAs, Trust Agreements, MPLAs, and SSAs (together, the “Governing Agreements”) are of critical importance to Defendant’s motion; they dictate the scope of Defendant’s duties to Plaintiffs. The duties of an RMBS trustee are “distinct from those of an `ordinary trustee,’ which might have duties extending well beyond the agreement.” Phoenix Light SF Ltd. v. Bank of N.Y. Mellon (hereinafter, “PL/BNYM“), No. 14 Civ. 10104 (VEC), 2015 WL 5710645, at *2 (S.D.N.Y. Sept. 29, 2015) (citing AG Capital Funding Partners, L.P. v. State St. Bank & Tr. Co., 11 N.Y.3d 146, 156 (2008)); see also Fixed Income Shares: Series M v. Citibank N.A. (hereinafter, “Fixed Income Shares“), 130 F. Supp. 3d 842, 857-58 (S.D.N.Y. 2015). In contrast, “the duties of an indenture trustee . . . [are] governed solely by the terms of the indenture[.]” Millennium Partners, L.P. v. U.S. Bank Nat’l Ass’n, No. 12 Civ. 7581 (HB), 2013 WL 1655990, at *3 (S.D.N.Y. Apr. 17, 2013) (quotation mark omitted), aff’d sub nom. Millennium Partners, L.P. v. Wells Fargo Bank, N.A., 654 F. App’x 507 (2d Cir. 2016) (summary order), and aff’d sub nom. Millennium Partners, L.P. v. Wells Fargo Bank, N.A., 654 F. App’x 507 (2d Cir. 2016) (summary order). “This is true regardless of whether the trust is an indenture trust or a PSA [trust].” Royal Park Invs. SA/NV v. HSBC Bank USA, Nat’l Ass’n (hereinafter, “RP/HSBC“), 109 F. Supp. 3d 587, 597 (S.D.N.Y. 2015) (citing Greenwich Fin. Servs. Distressed Mortg. Fund 3 LLC v. Countrywide Fin. Corp., 603 F.3d 23, 29 (2d Cir. 2010); Bank of N.Y. Mellon v. Walnut Place LLC, 819 F. Supp. 2d 354, 364-65 & n.6 (S.D.N.Y. 2011)).

Though the Governing Agreements at issue here are not identical, Plaintiffs argue that they all impose four fundamental duties on Defendant:

• First, Defendant “must ensure that the Trusts take perfected, enforceable title to the mortgage loans and must certify receipt of complete mortgage loan files from the Seller.” (Pl. Opp. 3 (citing BR Compl. ¶¶ 60, 62, 98, 159, Ex. 5; NCUAB Compl. ¶¶ 65-68, Ex. J; PL Compl. ¶¶ 58-67; CB Compl. ¶¶ 34-43)). In the event that Defendant “discovers a material defect (e.g., a missing document),” Defendant is obligated to “promptly identify the loan in its certifications, and require the Seller to cure or repurchase the loan.” (Pl. Opp. 3-4 (citing BR Compl. ¶¶ 6, 54, 98; NCUAB Compl. ¶¶ 70-71, 74-75; PL Compl. ¶¶ 65-66, 68; CB Compl. ¶¶ 41-42, 44)).

? Second, Defendant “must give notice to the Seller and other parties upon `discovery’ of any breach of the R&Ws which materially and adversely affects the interests of the Holders or the Trust, and thereafter enforce the obligations of the Seller to cure or repurchase the breaching loan.” (Pl. Opp. 4 (citing BR Compl. ¶¶ 63, 164; RP Compl. ¶¶ 7-10; NCUAB Compl. ¶¶ 75, 377; PL Compl. ¶ 68; CB Compl. ¶ 44)).

? Third, Defendant “must promptly notify a responsible Servicer upon learning of the Servicer’s failure to perform in any material respect, and demand that such servicing failure be timely remedied.” (Pl. Opp. 4 (citing BR Comp. ¶¶ 1, 63-64; RP Compl. ¶ 10; NCUAB Compl. ¶¶ 75, 90; PL Compl. ¶ 80; CB Compl. ¶ 55)).

? And fourth, in the event of a “servicing `Event of Default'” (“EOD”) as defined in the Governing Agreements, Defendant acquires heightened obligations “to exercise the same degree of care and skill as a prudent person would in the conduct of his or her own affairs.” (Pl. Opp. 4 (citing BR Compl. ¶¶ 27, 207; RP Compl. ¶¶ 17, 61; NCUAB Compl. ¶¶ 92, 414; PL Compl. ¶¶ 73-75; CB Compl. ¶¶ 49-51)).

The PSA Trusts define an EOD to “include a Servicer’s failure to: (i) act in accordance with the normal and usual standards of practice of prudent mortgage servicers; (ii) ensure the loans are serviced legally; and (iii) promptly notify [Defendant] and other parties upon discovery of Sellers’ R&W breaches.” (Pl. Opp. 4 (citing BR Compl. ¶¶ 25-26; RP Compl. ¶¶ 57, 59; NCUAB Compl. ¶¶ 85-87, 285-89, 337; PL Compl. ¶¶ 68, 79-80; CB Compl. ¶¶ 44, 54-55)). Defendant’s heightened obligations under the PSAs in the event of an EOD include “notifying the Servicer to require cure and notifying Certificateholders of any uncured [EODs].” (Id. at 4-5 (citing BR Compl. ¶ 26; RP Compl. ¶ 60; NCUAB Compl. ¶¶ 90-91, 290; PL Compl. ¶¶ 69, 73-77; CB Compl. ¶¶ 45, 49-52)).

The Indenture Trusts’ Governing Agreements “contain similar provisions.” (Pl. Opp. 5 (citing BR Compl. ¶¶ 68-70; NCUAB Compl. ¶ 97 n.12; PL Compl. ¶¶ 131-32)). EODs with regard to Indenture Trusts, however, are “triggered by conduct of the Issuer (i.e., the Trust itself) rather than the Servicer.” (Id. (citing BR Compl. ¶¶ 68-70; NCUAB Compl. ¶ 87 n.12; PL Compl. ¶¶ 131-32)). Plaintiffs maintain that this is a distinction without a difference, because here “each Indenture Trust contracted separately with Sellers and Servicers . . . [to] make certain R&Ws and agree to cure or repurchase defective loans,” such that “known and unremedied Seller and Servicer defaults [would still] constitute . . . a violation of the issuer’s duties under the Indenture.” (Id. (quotation marks omitted) (quoting Royal Park/HSBC, 109 F. Supp. 3d at 604) (citing BR Compl. ¶¶ 6, 59, 68; NCUAB Compl. ¶¶ 64-69, 74, 92; PL Compl. ¶ 131 & Ex. C)).

3. Defendant’s Alleged Breaches

Plaintiffs contend that while serving as Trustee, Defendant realized that the Trusts contained numerous loans and loan files that materially breached the sellers’ R&Ws. (Pl. Opp. 5 (citing BR Compl. ¶¶ 73-120; RP Compl. ¶¶ 70-103; NCUAB Compl. ¶¶ 104-282; PL Compl. ¶¶ 107-15, Ex. F; CB Compl. ¶¶ 80-89, Ex. F)). Plaintiffs infer Defendant’s realization from a host of facts. For example, Defendant “received `Document Exception Reports’ prepared by the custodians identifying massive numbers of loan files that contained missing or incomplete documentation that were not cured within the specified time period.” (Id. (citing BR Compl. ¶¶ 98-99; NCUAB Compl. ¶ 352; PL Compl. ¶¶ 63, 119-20; CB Compl. ¶¶ 39, 93-94)). And Defendant itself “tracked and reported the Trusts’ performance in remittance reports, including unprecedented levels of delinquencies, early payment defaults, loss severity, credit downgrades and mortgage insurance rescissions,” and “admitted” in its “internal documents” that its findings constituted “clear indications of Seller breaches of R&Ws.” (Id. at 5-6 (citing BR Compl. ¶¶ 110, 112; NCUAB Compl. ¶ 336; PL Compl. ¶¶ 53, 104; CB Compl. ¶¶ 29, 78)). Additionally, in certain cases where “historical delinquencies and collateral losses were so severe that [they] caused `Triggering Events’ under the Trusts’ [Governing Agreements],” Defendant had to “change the distribution of Trust proceeds, evaluate the performance of the Trusts’ Servicers, make increased disclosures to the credit rating agencies, and in some instances declare [EODs].” (Id. at 6 (citing BR Compl. ¶ 111)).

Plaintiffs conclude that, given the many different sources of information, Defendant’s responsible officers

knew of and received written notice of Servicer breaches of duties with respect to specific loans in the Trusts, based on data from Servicers that it used to prepare monthly remittance reports and that identified and tracked when certain defaulted loans within the Trusts became distressed, when the loans were processed and eliminated, and the recurring annual and monthly servicing costs incurred by the Trusts for these defaulted loans.

(Pl. Opp. 7 (citing BR Compl. ¶¶ 146-53; RP Compl. ¶ 118; PL Compl. ¶¶ 128, 138-41; CB Compl. ¶¶ 103, 111-14)). Indeed, Defendant “uniquely” had

knowledge of the Servicers’ systemically abusive servicing practices, including (i)[Defendant’s] involvement in government investigations, prosecutions, and settlements targeting both itself and many of the Servicers for the same alleged improper servicing practices; and (ii) [Defendant’s] responsible officers’ receipt of written notice from Holders, monoline insurers and other stakeholders to other RMBS trusts regarding the same servicing violations by the same servicers to the Trusts here.

(Id. (citing BR Compl. ¶¶ 154-56; RP Compl. ¶¶ 121-27; NCUAB Compl. ¶¶ 258-60, 277-82; PL Compl. ¶¶ 142-48, Ex. H; CB Compl. ¶¶ 115-21, Ex. H)). And Plaintiffs contend that Defendant’s knowledge is evinced by its own internal records, which “further confirm that [Defendant] repeatedly received notice from investors and monoline insurers regarding systemic R&W violations.” (Id. at 6 (citing BR Compl. ¶¶ 100, 116; PL Compl. ¶¶ 99-102; CB Compl. ¶¶ 73-77)).

Even if Defendant lacked such direct notice and knowledge, they could not feign ignorance of the fact that “the Trusts were filled with loans originated by some of the most notorious financial-crisis-era lenders . . . and were sponsored by banks with known securitization abuses.” (Pl. Opp. 6 (citing BR Compl. ¶¶ 80, 86, 94-95, Ex. 9; RP Compl. ¶ 71; NCUAB Compl. ¶¶ 47-48, 120-244; PL Compl. ¶¶ 109-10, Ex. F; CB Compl. ¶¶ 82-83, Ex. F)). Plaintiffs argue that at a minimum, Defendant had to be aware of the “[h]ighly publicized news reports, lawsuits, and investigations concerning” its sellers, as well as the fact that “several of the Trusts [had] been the subject of RMBS investor lawsuits alleging pervasive loan underwriting abuses.” (Id. (citing BR Compl. ¶¶ 96-120, Ex. 10-11; RP Compl. ¶¶ 72-103; NCUAB Compl. ¶¶ 261-82; PL Compl. ¶¶ 107-15; CB Compl. ¶¶ 80-89)).

All of Plaintiffs’ claims build on the foundation of Defendant’s alleged discovery and knowledge of these breaches. Plaintiffs allege that despite this awareness, Defendant took “virtually no action to enforce Seller obligations to repurchase defective loans and Servicer obligations to cure defaults and reimburse the Trusts for damages.” (Pl. Opp. 7 (citing BR Compl. ¶¶ 163-87; RP Compl. ¶ 129; NCUAB Compl. ¶¶ 361-96; PL Compl. ¶¶ 115-18, 160-61; CB Compl. ¶¶ 89-92, 129-30)). This “inaction” has caused “billions of dollars in losses to the Trusts.” (Id.).

B. Procedural Background

The Blackrock plaintiffs brought the first of these related cases against Defendant on November 24, 2014. (2014 Civ. 9371, Dkt. #1). Royal Park brought its action on December 11, 2014 (2014 Civ. 9764, Dkt #1); the NCUAB brought its action on December 22, 2014 (2014 Civ. 10067, Dkt. #1); and Phoenix Light and others brought their action on December 23, 2014 (2014 Civ. 10102, Dkt. #1). Royal Park, the NCUAB, and the Phoenix Light plaintiffs all filed amended complaints on March 13, 2015. (2014 Civ. 9764, Dkt #24; 2014 Civ. 10067, Dkt. #27; 2014 Civ. 10102, Dkt. #25).

Defendant filed its Motion to Dismiss the Complaints in each of these four cases on April 30, 2015. (2014 Civ. 9371, Dkt. #46-56).[5] The motion was fully briefed as of June 29, 2015. (Id. at Dkt. #60-61). While the motion was pending, on December 24, 2015, Commerzbank brought the fifth of the related cases at issue in this Opinion. (2015 Civ. 10033, Dkt. #1). The case was accepted as related to the four earlier-filed cases on December 28, 2015. (2015 Civ. 10033, Docket Entries dated December 28, 2015).

Soon thereafter, on January 19, 2016, Judge Richard M. Berman, to whom these related cases were originally assigned, issued a Decision and Order resolving Defendant’s motion to dismiss. (2014 Civ. 9371, Dkt. #95). Judge Berman declined to exercise supplemental jurisdiction over Blackrock’s PSA-Trust-related claims, granted Defendant’s motion in part, and declined to reach the merits of the parties’ claims. (Id. at Dkt. #95). Judge Berman also extended to Plaintiffs the opportunity to amend their pleadings. (Id.; see also Dkt. #101). The Blackrock Plaintiffs accordingly filed their amended complaint on February 23, 2016. (Id. at Dkt. #105-06).

Defendant requested a pre-motion conference, which was scheduled for May 24, 2016. (2014 Civ. 9371, Dkt. #138, 158). During that conference, a briefing schedule was set for Defendant’s contemplated motion to dismiss the operative complaints. (Id. at Dkt. #158).

Before any motion was filed, however, the five related cases at issue here were reassigned to the undersigned on June 17, 2016. (Docket Entries dated June 17, 2016). Defendant then filed its motion to dismiss each operative complaint on July 8, 2016. (2014 Civ. 9371, Dkt. #168-71). Plaintiffs filed their joint opposition on August 22, 2016 (id. at Dkt. #201-02), and Defendant its reply on September 6, 2016 (id. at Dkt. #208-09).

DISCUSSION

A. Applicable Law

When considering a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a court should “draw all reasonable inferences in [the plaintiffs’] favor, assume all well-pleaded factual allegations to be true, and determine whether they plausibly give rise to an entitlement to relief.” Faber v. Metro. Life Ins. Co., 648 F.3d 98, 104 (2d Cir. 2011) (quotation marks and citation omitted) (quoting Selevan v. N.Y. Thruway Auth., 584 F.3d 82, 88 (2d Cir. 2009)). Thus, “[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). In this regard, a complaint is deemed to include any written instrument attached to it as an exhibit or any statements or documents incorporated in it by reference. See, e.g., Hart v. FCI Lender Servs., Inc., 797 F.3d 219, 221 (2d Cir. 2015) (citing Fed. R. Civ. P. 10(c) (“A statement in a pleading may be adopted by reference elsewhere in the same pleading or in any other pleading or motion. A copy of a written instrument that is an exhibit to a pleading is a part of the pleading for all purposes.”)).

“While Twombly does not require heightened fact pleading of specifics, it does require enough facts to `[nudge a plaintiff’s] claims across the line from conceivable to plausible.'” In re Elevator Antitrust Litig., 502 F.3d 47, 50 (2d Cir. 2007) (per curiam) (quoting Twombly, 550 U.S. at 570). “Where a complaint pleads facts that are `merely consistent with’ a defendant’s liability, it `stops short of the line between possibility and plausibility of entitlement to relief.'” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557). Moreover, “the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id.

B. Analysis

Defendant launches numerous attacks on Plaintiffs’ pleadings, claiming that wholesale dismissal is warranted because: (i) Plaintiffs have failed to plead that Defendant discovered any of the alleged breaches of the Governing Agreements; (ii) Plaintiffs’ breach-of-contract and fiduciary-duty claims are premised on an EOD that occurred, if at all, without Defendant’s knowledge; (iii) Plaintiffs’ tort claims are duplicative of their contract claims, violative of the economic-loss rule, and insufficiently pleaded; (iv) Plaintiffs do not, and cannot, have a cause of action under the Trust Indenture Act (the “TIA”); (v) the Streit Act, New York’s analogue to the TIA, either does not apply to Plaintiffs’ claims or was not violated; (vi) the NCUAB lacks standing to bring its derivative claims, which are actually improper direct claims; (vii) the NCUAB lacks standing to bring direct claims premised on Trusts unwound after it first brought its action; and (viii) Commerzbank’s claims are time-barred. The Court will consider each of these arguments in turn.

1. Defendant’s Motion to Dismiss Plaintiffs’ Breach-of-Contract Claims Is Denied

a. Plaintiffs’ Allegations Are Sufficient at the Pleading Stage

Defendant’s arguments on this first front focus on Defendant’s alleged knowledge, or perhaps more properly, its lack thereof. (Def. Br. 8). That is, Defendant contends Plaintiffs have pleaded only generalized allegations that, at most, Defendant may have been alerted “to a possibility of a breach, not that it discovered any actual breaches in the loans in the Trusts.” (Id.). Such allegations are insufficient as a matter of law, Defendant argues, because a viable breach-of-contract claim requires proof of a Trustee’s actual notice of a breach. Id. (quoting Policemen’s Annuity & Benefit Fund v. Bank of Am., NA (hereinafter, “PABF II“), 943 F. Supp. 2d 428, 442 (S.D.N.Y. 2013), abrogated on other grounds by PABF III, 775 F.3d 154).

These arguments do not succeed. To the contrary, courts in this District have repeatedly rejected similar arguments by reminding litigants of the difference between sufficient pleading and successful claims. So too will this Court.

It is true that “[t]o prevail ultimately on the breach of contract claim, a plaintiff does have to demonstrate breach on a `loan-by-loan and trust-by-trust basis.'” Phoenix Light SF Ltd. v. Deutsche Bank Nat’l Tr. Co. (hereinafter, “PL/DB“), 172 F. Supp. 3d 700, 713 (quoting Royal Park Invs. SA/NV v. Deutsche Bank Nat’l Tr. Co. (hereinafter, “RP/DB“), No. 14 Civ. 4394 (AJN), 2016 WL 439020, at *6 (S.D.N.Y. Feb. 3, 2016)); see also PABF III, 775 F.3d at 162. “But this is not a pleading requirement,” because at the pleading stage such information “is uniquely in the possession of defendants.” PL/DB, 172 F. Supp. 3d at 713 (quotation marks omitted) (quoting PABF II, 943 F. Supp. 2d at 442). “Rather, plaintiffs satisfy their [pleading] burden where their allegations raise a reasonable expectation that discovery will reveal evidence proving their claim.” Id.; accord, e.g., Royal Park Invs. SA/NV v. Bank of N.Y. Mellon (hereinafter, “RP/BNYM“), No. 14 Civ. 6502 (GHW) 2016 WL 899320, at *4-5 (S.D.N.Y. March 2, 2016); Blackrock Core Bond Portfolio v. U.S. Bank Nat’l Ass’n, No. 14 Civ. 9401 (KBF), 165 F. Supp. 3d 80, 99-100 (S.D.N.Y. Feb. 26, 2016); RP/DB, 2016 WL 439020, at *6; PL/BNYM, 2015 WL 5710645, at *4; RP/HSBC, 109 F. Supp. 3d at 602-03. (See also Pl. Opp. 9 & n.5).

Here, Plaintiffs have more than met this standard. Plaintiffs have alleged Defendant’s knowledge of R&W breaches on the basis of Defendant’s internal documents: Defendant received “exception reports identifying incomplete or improperly documented loan files that were not corrected or addressed.” (Pl. Opp. 11 (citing BR Compl. ¶¶ 98-99; PL Compl. ¶¶ 63, 118-20; CB Compl. ¶¶ 39, 93-94)). Defendant also “received mortgage insurance coverage denials and policy rescissions as a result of the improper loan underwriting,” and Defendant’s internal documents both reflect that Defendant tracked “the Trusts’ abject performance,” and “contain admissions that certain adverse metrics were indicative of Seller R&W breaches.” (Id. at 11-12; see also BR Compl. ¶ 110; NCUAB Compl. ¶ 336; PL Compl. ¶¶ 53, 104; CB Compl. ¶¶ 28, 78). It is Plaintiffs’ contention that such allegations “go far beyond many other RMBS trustee complaints, which themselves have been found sufficient to state a claim.” (Id. at 12). The Court agrees.

For good measure, Plaintiffs also amass the R&W breach allegations with which courts in this Circuit have become so familiar: Plaintiffs allege, inter alia, that Defendant had discovered and knew of the alleged breaches on the basis of (i) “the abysmal performance of the Trust collateral” (BR Compl. ¶ 10); (ii) “a steady stream of public disclosures [linking] the abject performance of the Trusts to systemic abandonment of underwriting guidelines” (id. at ¶ 12); (iii) various investor “putback initiatives” (id. at ¶¶ 14-17); (iv) investigations targeting Defendant’s own deficient servicing operations (id. at ¶¶ 19-20); (v) notice Defendant received in its capacity as Trustee to other RMBS trusts “from investors of pervasive and systemic violations of representations and warranties by the loan sellers” (id. at ¶ 100); (vi) lawsuits brought by monoline insurers against sellers “for breach of their representations and warranties in connection with other RMBS trusts” to which Defendant has ties (id. at ¶ 116); and (vii) Defendant’s analysis undertaken in connection with its provision of “collateral risk management services” (id. at ¶ 118). (See also RP Compl. ¶¶ 70-136; NCUAB Compl. ¶¶ 104-282; PL Compl. ¶¶ 107-15; CB Compl. ¶¶ 80-89). And with regard to several of the Trusts, “the historical delinquencies and collateral losses within the Trusts’ loan pools [were] so severe that [they] . . . caused `Triggering Events’ under the Trusts’ Governing Agreements,” some of which amounted to EODs. (BR Compl. ¶ 111). This Court finds, as have many others, that these allegations are sufficient to “raise a reasonable expectation that discovery will reveal evidence proving [Plaintiffs’] claim[s].” PL/DB, 172 F. Supp. 3d at 713 (quoting PABF II, 943 F. Supp. 2d at 442).

Additionally, Plaintiffs allege that EODs occurred when Servicers failed to “(i) act in accordance with the normal and usual standards of practice of prudent mortgage servicers; (ii) ensure the loans were serviced legally; and (iii) promptly notify [Defendant] and other parties upon discovery [of Sellers’] R&W breaches.” (Pl. Opp. 4 (citing BR Compl. ¶¶ 25-26; RP Compl. ¶¶ 57, 59; NCUAB Compl. ¶¶ 85-87, 285-89, 337; PL Compl. ¶¶ 68, 79-80; CB Compl. ¶¶ 44, 54-55)). These allegations also support Plaintiffs’ claims that Defendant breached its post-EOD contractual duty to act as would a prudent person by failing to (i) notify Servicers of the R&W breaches of which it was aware, (ii) require those Servicers to cure those breaches, or to repurchase defective loans; (iii) notify Certificateholders of any uncured EODs; and (iv) reimburse the Trusts for damages. (Pl. Opp. 3-5, 7 (citing BR Compl. ¶¶ 163-87; RP Compl. ¶ 129; NCUAB Compl. ¶¶ 361-96; PL Compl. ¶¶ 115-18, 160-61; CB Compl. ¶¶ 89-92, 129-30)).

In sum, Plaintiffs have pleaded adequately that Defendant discovered and knew of the alleged breaches of the Trusts’ Governing Agreements. Plaintiffs likewise adequately have pleaded that when Defendant failed to act despite its discovery and knowledge, it breached the Governing Agreements. Defendant’s motion to dismiss Plaintiffs’ breach-of-contract claims is denied.

b. Commerce Bank Does Not Change This Court’s Analysis

To its credit, Defendant acknowledges at the outset that its arguments regarding the adequacy of the Complaints’ discovery and knowledge allegations implicate “issues that have been resolved repeatedly against RMBS trustees.” (Def. Br. 8). Undaunted, Defendant contends that recent legal developments so “seriously undermine the federal court decisions to date rejecting the RMBS trustees’ contract-based arguments” that this Court must chart a new course. (Id.). In support, Defendant relies upon the First Department’s “rejection” in Commerce Bank v. Bank of N.Y. Mellon, 35 N.Y.S.3d 63 (1st Dep’t 2016), of the theory that an RMBS Trustee has a duty to “nose to the source” upon learning facts suggestive of breach.[6]

This Court does not dispute Commerce Bank‘s relevance to its analysis. Indeed the case addresses the very question now before the Court — the sufficiency of pleaded facts regarding an RMBS-trustee defendant’s knowledge of breach. Commerce Bank, 35 N.Y.S.3d at 64. And there, the First Department found the facts alleged by the Commerce Bank plaintiffs insufficient to state a claim. Id. Reviewing the PSAs at issue, the court recited their common requirement that the Trustee discover an R&W breach with regard to a “loan-to-loan ratio, whether there are other liens on a property, whether a loan was underwritten pursuant to [a nonparty’s] underwriting guidelines,” and so on. Id. The First Department concluded the plaintiffs “[did] not allege that defendant discovered breaches of such representations and warranties.” Id. (emphasis added).

But the First Department did not elaborate on the bases for this conclusion. And without more, this Court will not read Commerce Bank to conflict with the very case law from this District that the First Department cited therein as “persuasive” in its analysis of pleading sufficiency. See Commerce Bank, 35 N.Y.S.3d at 64 (citing RP/BNYM, 2016 WL 899320, at *4 (collecting cases); PL/DB, 172 F. Supp. 3d at 712-13). Significantly, Defendant assumes that the Commerce Bank plaintiffs and Plaintiffs here suffer from the same pleading deficiency, viz., a failure to plead Defendant’s actual discovery of R&W breaches. (Def. Br. 8-10). But the First Department’s analysis is not so clear. That court said only that the Commerce Bank plaintiffs “do not allege that defendant discovered breaches of such representations and warranties.” Commerce Bank, 35 N.Y.S.3d at 64 (emphasis added). The court did not explain what precisely it found lacking. This Court cannot therefore determine precisely where the Commerce Bank court would draw a line; the insufficiency of the allegations in that case do not preclude the Court from finding the far more robust allegations in this case to be sufficient.

Moreover, the Court notes that the Commerce Bank court was considering pleading sufficiency under a different standard. Defendant has challenged Plaintiffs’ pleading under Federal Rule of Civil Procedure 12(b)(6), the analytical requirements of which are outlined above. The Commerce Bank court analyzed pleading sufficiency under New York Civil Practice Law and Rules § 3211(a)(1) and (7). Even allowing for a similarity between Section 3211(a)(7) and Rule 12(b)(6), see Util. Metal Research, Inc. v. Generac Power Sys., Inc., No. 02 Civ. 6205 (FB) (RML), 2004 WL 2613993, at *3 n.1 (E.D.N.Y. Nov. 18, 2004) (“This is . . . a distinction without a difference.”), aff’d in part, vacated in part, and remanded on other grounds, 179 F. App’x 795 (2d Cir. 2006) (summary order), the different standard required by § 3211(a)(1) casts Commerce Bank‘s relevance into doubt. See, e.g., DDR Constr. Servs., Inc. v. Siemens Indus., Inc., 770 F. Supp. 2d 627, 647-48 (S.D.N.Y. 2011) (“Rule 3211(a)(1) allows dismissal on the ground that `a defense is founded upon documentary evidence.'” (quoting N.Y. C.P.L.R. 3211(a)(1))). It is possible, for example, that the Commerce Bank court considered defenses not available to this Court at this stage. Stated simply, Commerce Bank is not sufficiently specific for this Court to determine the precise manner in which the First Department concluded that the plaintiffs therein had not alleged the defendant’s discovery.

Defendant also contends that the First Department relieved RMBS Trustees of a duty to “nose to the source.” (Def. Br. 10). But that contention overstates the First Department’s holding. In considering a trustee’s duties prior to an EOD, the First Department recited the well-settled proposition “that prior to default, indenture trustees owe note holders [only] an extracontractual duty to perform basic, nondiscretionary, ministerial functions.” Commerce Bank, 35 N.Y.S.3d at 65 (quotation mark omitted) (quoting AG Capital Funding Partners, 11 N.Y.3d at 157). This limited pre-default duty, the Court concluded, did not encompass a duty to monitor or a duty to “nose to the source” of improper servicing. Id.

This holding is not inconsistent with the District decisions cited by the First Department. Prior to considering a trustee’s pre-default duties, the Commerce Bank court had found that the plaintiffs there had not alleged the requisite discovery by the defendant. Commerce Bank, 35 N.Y.S.3d at 64-65. That is, the plaintiffs had alleged no discovery of R&W breaches, and no provision of written notice of any EOD. Id. Thus, the court reasoned, the defendant could not have violated any duty to afford plaintiffs notice. Id. at 65. Pre-default, and without default discovery or written notice, the Commerce Bank defendant had no such duty. Id.

Courts in this Circuit have agreed. They have held that while “[l]earning of facts merely suggestive of a breach would not require the Trustee to immediately raise a claim,” “upon receipt of such notice, it becomes incumbent upon the [Trustee] to pick up the scent and nose to the source.” Policemen’s Annuity & Benefit Fund of City of Chi. v. Bank of Am., NA (hereinafter, “PABF I”), 907 F. Supp. 2d 536, 553 (S.D.N.Y. 2012) (alterations in original) (emphasis added) (quotation marks omitted) (quoting MASTR Asset Backed Sec. Tr. 2006-HE3 ex rel. U.S. Bank Nat’l Ass’n v. WMC Mortg. Corp., Civil Nos. 11-2542 (JRT/TNL), 12-1372 (JRT/TNL), 12-1831 (JRT/TNL), 12-2149 (JRT/TNL), 2012 WL 4511065, at *6 (D. Minn. Oct. 1, 2012)). In Commerce Bank, there was no notice, no discovery, and therefore no duty to “nose to the source.” This is consistent with the law in this Circuit; it does not undermine it.

Finally, even if Defendant’s proffered interpretation of Commerce Bank were correct, this Court would be skeptical of its authority. As noted above, the case was decided under New York law that differs significantly from Rule 12(b)(6). And a district court only is “bound to apply the law as interpreted by New York’s intermediate appellate courts,” absent “persuasive evidence that the New York Court of Appeals . . . would reach a different conclusion.” Cornejo v. Bell, 592 F.3d 121, 130 (2d Cir. 2010) (omissions in original) (emphasis added) (quotation marks omitted) (quoting Pahuta v. Massey-Ferguson, Inc., 170 F.3d 125, 134 (2d Cir. 1999)). Here, there is such persuasive evidence; it is the abundant case law from this District that the First Department itself cited as persuasive and made no attempt to distinguish.

2. Defendant’s Motion to Dismiss Specific R&W Claims Is Denied

In a catch-all section in its opening brief, Defendant takes issue with various subsets of Plaintiffs’ claims. First, Defendant argues that Plaintiffs have improperly alleged violations of duties to enforce repurchase obligations with regard to certain Trusts that created no such obligations. (Def. Br. 16). Second, Defendant identifies three Trusts for which “Plaintiffs failed to allege that [Defendant] knew of R&W breaches prior to the expiration of the Warrantors’ obligations to repurchase loans that breached R&Ws.” (Id.). Third, Defendant argues that for “four additional Trusts, Plaintiffs fail to include any allegation regarding the relevant Warrantors, let alone allegations supporting a plausible inference that [Defendant] had knowledge of R&W breaches within the applicable limitations period.” (Id. at 17). And fourth, Plaintiffs argue that Defendant cannot be held liable for any failure to enforce its obligations to cure, substitute, or repurchase faulty loans against Warrantor American Home Mortgage Acceptance, Inc. (“AHM”), because AHM filed for bankruptcy in 2007. (Id. at 17-18).

Plaintiffs rebut each allegation. First, Plaintiffs dispute Defendant’s argument that certain Trusts do not impose repurchase obligations on Defendant; they claim that the relevant governing agreements, read as a whole, require that Defendant “notify specified parties upon its discovery of a material R&Ws breach,” which notice “triggers [the] Seller repurchase obligations” that Defendant “has power to enforce.” (Pl. Opp. 13 (citing BR Compl. ¶¶ 63 & n.7, 193; RP Compl. ¶¶ 52-55; NCUAB Compl. ¶¶ 73-75; PL Compl. ¶¶ 44, 68; CB Compl. ¶ 44)). Second, Plaintiffs disclaim a duty to “allege the precise time of [Defendant’s] discovery of R&W breaches or knowledge of Servicer events of default, which will be fleshed out in discovery.” (Id. at 14). In a similar vein, Plaintiffs argue to Defendant’s third point that any “statute of limitations defense cannot be resolved at this stage because it involves factual questions as to when and against whom the claims accrued, whether violations were continuing, and whether tolling applies.” (Id.). And fourth, Plaintiffs reject Defendant’s arguments regarding AHM’s 2007 bankruptcy because “this argument also involves questions of fact that cannot be resolved at the pleading stage, such as what enforcement efforts [Defendant] made or failed to make before AHM declared bankruptcy, whether it should have submitted a bankruptcy claim, and what other responsible parties or claims remain available, including for ongoing Servicer violations.” (Id. at 14-15).

Ultimately, the Court agrees with Plaintiffs. Each of Defendant’s arguments implicating the statute of limitations is premature; the Court cannot resolve these issues from the face of the Complaints. See Staehr v. Hartford Fin. Servs. Grp., Inc., 547 F.3d 406, 425 (2d Cir. 2008) (noting that a statute of limitations defense may be “raise[d] . . . in a pre-answer Rule 12(b)(6) motion if the defense appears on the face of the complaint”). Working backwards from Defendant’s last argument, the Court cannot determine at this stage the implications of AHM’s 2007 bankruptcy filing for Defendant’s duties with regard to the AHM-2004 Trust. As Plaintiffs argue, the possible existence of other responsible parties or claims, including claims for ongoing Servicer violations, precludes resolution of this issue at present. Because, as the Court found above, Plaintiffs need not allege loan-specific breaches at this stage, and because Plaintiffs have raised the specter of tolling agreements and ongoing breaches, the Court is also unable to determine as a matter of law that Plaintiffs have insufficiently alleged discovery of R&W breaches before expiration of applicable statutes of limitations. (Pl. Opp. 14 & n.8). And finally, the Court finds that Plaintiffs have alleged that Defendant breached its obligations even with regard to Trusts the Governing Agreements of which “are silent as to which entity is responsible for enforcing the sellers’ compliance with their repurchase obligations, prior to an [EOD].” (BR Compl. ¶ 63 & n.7 (citing as an example FMIC 2007-1, SSA § 3.02)). At this stage, Plaintiffs are not required to specify precisely when, and precisely on what basis, Defendant breached each of its contractual obligations.

3. Defendant’s Motion to Dismiss Plaintiffs’ Tort and Fiduciary-Duty Claims Is Granted in Part and Denied in Part

a. Defendant’s Motion to Dismiss Plaintiffs’ General Negligence Claim Is Granted

The Court next turns to Defendant’s challenges to Plaintiffs’ tort claims, beginning with their claim for negligence. By way of background, “[t]o establish a negligence claim under New York law, a plaintiff must demonstrate that: [i] the defendant owed the plaintiff a cognizable duty of care as a matter of law; [ii] the defendant breached that duty; and [iii] plaintiff suffered damage as a proximate result of that breach.” Millennium Partners, 2013 WL 1655990, at *4 (citing McCarthy v. Olin Corp., 119 F.3d 148, 156 (2d Cir. 1997)). However, “[a] tort claim cannot be sustained if it `do[es] no more than assert violations of a duty which is identical to and indivisible from the contract obligations which have allegedly been breached.'” Id. (second alteration in original) (quoting Metro. W. Asset Mgmt., LLC v. Magnus Funding, Ltd., No. 03 Civ. 5539 (NRB), 2004 WL 1444868, at *9 (S.D.N.Y. June 25, 2004)); see also Luxonomy Cars, Inc. v. Citibank, N.A., 408 N.Y.S.2d 951, 954 (2d Dep’t 1978). In other words, “a breach of contract will not give rise to a tort claim unless a legal duty independent of the contract itself has been violated.” RP/BNYM, 2016 WL 899320, at *7 (quotation mark omitted) (quoting Bayerische Landesbank, N.Y. Branch v. Aladdin Capital Mgmt. LLC, 692 F.3d 42, 58 (2d Cir. 2012) (citing Clark-Fitzpatrick, Inc. v. Long Island R.R. Co., 70 N.Y.2d 382, 389 (1987))).

Here, the sole basis of Plaintiffs’ general negligence claim is Defendant’s alleged breach of its contractual obligations. (See, e.g., BR Compl. ¶ 163 (asserting that Defendant was negligent “by failing to (i) provide notice to the parties to the Governing Agreements and/or the responsible sellers upon its discovery of these breaches, and (ii) take any action to enforce the sellers’ repurchase of the defective mortgage loans”)). As such, “the claim is precluded as duplicative.” RP/DB, 2016 WL 439020, at *9 (quotation mark omitted) (quoting Bayerische Landesbank, 692 F.3d at 58).

To be clear, Plaintiffs at times plead more specific tort claims under the rubric of negligence, and those claims are neither addressed nor dismissed here. The Court grants Defendant’s motion only insofar as it applies to Plaintiffs’ claims that Defendant was negligent in performing its contractual duties. The Court will consider the viability of Plaintiff’s additional tort claims in greater depth in the sections that follow.

b. Defendant’s Motion to Dismiss Plaintiff’s Pre-Default Fiduciary-Duty Claims Is Granted

Plaintiffs’ fiduciary duty claims divide temporally into pre- and postdefault claims. This Court will consider them chronologically.

“Prior to an Event of Default, an indenture trustee’s duty is governed solely by the terms of the indenture, with two exceptions: a trustee must still `[i] avoid conflicts of interest, and [ii] perform all basic, non-discretionary, ministerial tasks with due care.” RP/HSBC, 109 F. Supp. 3d at 597 (quoting Ellington Credit Fund, Ltd. v. Select Portfolio Servicing Inc., 837 F. Supp. 2d 162, 192 (S.D.N.Y. 2011)). However, “[t]hese two pre-default obligations are not construed as fiduciary duties, but as obligations whose breach may subject the trustee to tort liability.” Id. (quotation marks omitted) (quoting Ellington Credit Fund, Ltd., 837 F. Supp. 2d at 192); see also PL/DB, 172 F. Supp. 3d at 719 (“[C]onflict of interest claims and the claims that [Defendant] did not perform ministerial acts with due care are not proper breach of fiduciary claims under New York law, and can only be pleaded in the complaint as negligence claims.”); PL/BNYM, 2015 WL 5710645, at *7; AG Capital Funding Partners, 11 N.Y.3d at 157. Therefore, insofar as Plaintiffs’ conflict-of-interest and ministerial-task claims are pleaded as violations of Defendant’s fiduciary duties, Plaintiffs fail to state a claim and Defendant’s motion to dismiss is granted.

c. Defendant’s Motion to Dismiss Plaintiff’s Post-EOD Fiduciary-Duty Claims Is Denied

With regard to an indenture trustee’s fiduciary duties, however, an EOD is transformative: After an EOD, “an indenture trustee’s fiduciary duties expand under the New York common law such that `fidelity to the terms of an indenture does not immunize an indenture trustee against claims that the trustee has acted in a manner inconsistent with his or her fiduciary duty of undivided loyalty to trust beneficiaries.'” PL/DB, 172 F. Supp. 3d at 717-18 (quoting BNP Paribas Mortg. Corp. v. Bank of Am., N.A., 778 F. Supp. 2d 375, 401 (S.D.N.Y. 2011)); see also Beck v. Mfrs. Hanover Tr. Co., 632 N.Y.S.2d 520, 527-28 (1995). A trustee’s obligations “come more closely to resemble those of an ordinary fiduciary, regardless of any limitations or exculpatory provisions contained in the indenture.” RP/HSBC, 109 F. Supp. 3d at 597 (quotation marks omitted) (quoting BNP Paribas Mortg. Corp., 778 F. Supp. 2d at 401); see also Beck, 632 N.Y.S.2d at 527. A trustee is not required to act beyond the powers conferred by the governing agreements, but it “must, as prudence dictates, exercise those singularly conferred prerogatives in order to secure the basic purpose of any trust indenture, the repayment of the underlying obligation.” Id. (quotation marks omitted) (quoting Philip v. L.F. Rothschild & Co., No. 90 Civ. 0708 (WHP), 2000 WL 1263554, at *5 (S.D.N.Y. Sept. 5, 2000) (quoting Beck, 632 N.Y.S.2d at 528)); see also RP/DB, 2016 WL 439020, at *2.

As described above, Plaintiffs have alleged that EODs occurred when Servicers failed to “(i) act in accordance with the normal and usual standards of practice of prudent mortgage servicers; (ii) ensure the loans are serviced legally; and (iii) promptly notify [Defendant] and other parties upon discovery [of Sellers’] R&W breaches.” (Pl. Opp. 4 (citing BR Compl. ¶¶ 25-26; RP Compl. ¶¶ 57, 59; NCUAB Compl. ¶¶ 85-87, 285-89, 337; PL Compl. ¶¶ 68, 79-80; CB Compl. ¶¶ 44, 54-55)). And Defendant breached its post-EOD duty to act as would a prudent person by failing to (i) notify Servicers of the R&W breaches of which it was aware, (ii) require those Servicers to cure those breaches, or to repurchase defective loans; (iii) notify Certificateholders of any uncured EODs; and (iv) reimburse the Trusts for damages. (Pl. Opp. 7 (citing BR Compl. ¶¶ 163-87; RP Compl. ¶ 129; NCUAB Compl. ¶¶ 361-96; PL Compl. ¶¶ 115-18, 160-61; CB Compl. ¶¶ 89-92, 129-30)). As were these allegations sufficient to support a post-EOD breach-of-contract claim, so too are they sufficient to support Plaintiffs’ post-EOD, breach-of-fiduciary-duty claim. However, for the reasons explained more fully below, the portion of this claim that is duplicative in its remedy with Plaintiffs’ breach-of-contract claims is ultimately barred by the economic-loss doctrine, and Defendant’s motion to dismiss that portion of the claim is granted.

d. Defendant’s Motion to Dismiss Plaintiffs’ Breach-of-Due Care-Claim Is Granted in Part and Denied in Part

“Under New York law, `an indenture trustee owes a duty to perform its ministerial functions with due care, and if this duty is breached the trustee will be subjected to tort liability.'” PL/DB, 172 F. Supp. 3d at 717 (quoting AG Capital Funding Partners, 11 N.Y.3d at 157). In other RMBS cases, courts in this District have recognized that this duty of due care is extra-contractual and, as such, not duplicative of a plaintiff’s contract claims. See, e.g., id. at 718 (citing Nat’l Credit Union Admin. Bd. v. U.S. Bank Nat’l Ass’n (hereinafter, “NCUAB/U.S. Bank II“), No. 14 Civ. 9928 (KBF), 2016 WL 796850, at *11 (S.D.N.Y. Feb. 25, 2016)); PL/BNYM, 2015 WL 5710645, at *7; RP/HSBC, 109 F. Supp. 3d at 609 n.127. The Court finds as much here. Again, the Court clarifies that Defendant’s motion to dismiss these claims is granted to the extent that Plaintiffs have pleaded that Defendant breached its duty to perform ministerial functions with due care in breaching Defendant’s contractual obligations. It is denied with regard to Plaintiffs’ claims that Defendant breached a duty to act with due care other than by “systematically disregard[ing] its contractual . . . duties.” (NCUAB Compl. ¶ 343).[7] See also PL/DB, 172 F. Supp. 3d at 718 n.7 (citing AG Capital, 866 N.Y.S.2d at 584-85) (“[T]he plaintiffs appear to conflate the duty to perform ministerial acts with due care with their allegations that [the defendant] negligently performed or failed to perform certain duties under the contract. Only tort claims premised on the former survive because New York recognizes a duty to perform ministerial acts as an extra contractual duty.”).

e. Defendant’s Motion to Dismiss Plaintiffs’ Conflict-of-Interest Claims Is Denied

To plead properly a conflict-of-interest claim, a plaintiff must allege more than the existence of a “relationship between an issuer and an indenture trustee that is mutually beneficial and increasingly lucrative.” RP/HSBC, 109 F. Supp. 3d at 598 (quotation mark omitted) (quoting CFIP Master Fund, Ltd. v. Citibank, N.A., 738 F. Supp. 2d 450, 475 (S.D.N.Y. 2010) (quoting Page Mill Asset Mgmt. v. Credit Suisse First Boston Corp., No. 84152 (MBM), 2000 WL 877004, at *2 (S.D.N.Y. June 30, 2000))); accord, e.g., RP/BNYM, 2016 WL 899320, at *7. Nor does “[t]he mere fact that an indenture trustee does repeat business with an entity . . . create a conflict of interest.” RP/HSBC, 109 F. Supp. 3d at 610. Such “bald assertions of conflict” are not sufficient; a plaintiff must show that a trustee “personally benefitted” from the alleged misconduct. Id. at 598 (quoting Elliott Assocs. v. J. Henry Schroder Bank & Tr. Co., 838 F.2d 66, 70 (2d Cir. 1988)).

Courts in this District have found this requirement satisfied where a plaintiff alleges a defendant’s complicity in a “quid pro quo system.” RP/BNYM, 2016 WL 899320, at *7; RP/DB, 2016 WL 439020, at *9 (quoting Ellington Credit Fund, 837 F. Supp. 2d at 193); RP/HSBC, 109 F. Supp. 3d at 610. If a defendant is alleged to have “turn[ed] a blind eye to breaches of R&Ws in the hopes that counterparties would later `return a favor,'” courts will find that the defendant personally benefited from its decision not to act with regard to the known breaches, which “constitut[es] a conflict of interest.” RP/BNYM, 2016 WL 899320, at *7; see also, e.g., Fixed Income Shares, 130 F. Supp. 3d at 858 (finding plaintiffs had alleged defendant was “economically beholden” to sellers and servicers because defendant “faced repurchase liability for the sale and securitization of its own loans if [defendant] took action against them”).

Here, Plaintiffs have alleged that Defendant refused to act against sellers and servicers “because doing so would have exposed [Defendant’s] own misconduct as a Seller or Servicer for other RMBS trusts in which these same entities served as either trustee or servicer.” (Pl. Opp. 21 (citing BR Compl. ¶¶ 173-77; RP Compl. ¶¶ 151-52; NCUAB Compl. ¶¶ 355-59; PL Compl. ¶¶ 149-58; CB Compl. ¶¶ 122-27)). And this conflict, Plaintiffs allege, was “exacerbated” by Defendant’s “ongoing business relationships with the Sellers, Servicers and related companies,” the servicers’ payment of Defendant’s trustee fees, and Defendant’s economic disincentive to declare EODs. (Id. (citing BR Compl. ¶¶ 21, 178-85; RP Compl. ¶¶ 21-24, 63, 137-43; NCUAB Compl. ¶ 360; PL Compl. ¶¶ 149-58; CB Compl. ¶¶ 122-27)). While these exacerbating allegations alone might not be sufficient to support Plaintiffs’ conflict-ofinterest claims, they are certainly sufficient when coupled with Plaintiffs’ quid pro quo contention. Defendant’s motion to dismiss Plaintiffs’ conflict-of-interest claims is accordingly denied.

f. Defendant’s Motion to Dismiss Plaintiffs’ Claims for Breach of the Implied Covenant of Good Faith and Fair Dealing Is Granted

“New York law . . . does not recognize a separate cause of action for breach of the implied covenant of good faith and fair dealing when a breach of contract claim, based upon the same facts, is also pled.” PL/DB, 172 F. Supp. 3d at 721 (omission in original) (quoting Harris v. Provident Life & Accident Ins. Co., 310 F.3d 73, 81 (2d Cir. 2002)). “A plaintiff can maintain a claim for breach of the implied covenant of good faith and fair dealing simultaneously with a breach of contract claim `only if the damages sought by the plaintiff for breach of the implied covenant are not intrinsically tied to the damages allegedly resulting from breach of contract.'” Id. (quoting Page Mill Asset Mgmt. v. Credit Suisse First Bos. Corp., No. 98 Civ. 6907 (MBM), 2000 WL 335557, at *8 (S.D.N.Y. Mar. 30, 2000)).

Again, the viability of this claim must be considered at two stages — before and after an alleged EOD. Before a trustee discovers an EOD, a trustee has “no duties other than its contractual duties,” and “any cause of action for breach of implied duties cannot stand.” PL/BNYM, 2015 WL 5710645, at *9. Accordingly, Plaintiffs’ claims that Defendant breached an implied covenant of good faith and fair dealing before it discovered any EOD must be dismissed.

After an EOD, a trustee’s obligations are not so circumscribed by the Governing Agreements, as explained above. At this stage, the Court must determine whether the “damages sought by [Plaintiffs] for breach of the implied covenant are not intrinsically tied to the damages allegedly resulting from breach of contract.” PL/DB,172 F. Supp. 3d at 721 (quoting Page Mill Asset Mgmt., 2000 WL 335557, at *8(quotation marks omitted)).

Despite Defendant’s argument in its opening brief that this tort claim must be dismissed, Plaintiffs do not defend it. Instead, Plaintiffs’ tort arguments focus on the conflict-of-interest claim. Accordingly, the Court could find Plaintiffs’ implied covenant claim to be abandoned.

But even were it not abandoned, this claim would fail. Plaintiffs argue only that Defendant breached this covenant in failing to fulfill its contractual obligations. (See, e.g., PL Compl. ¶ 201 (“[Defendant] owed Plaintiffs, as express, intended third party beneficiaries under the PSAs, a duty of good faith and fair dealing pursuant to the PSAs that required [Defendant] to ensure that it did not, by act or omission, injure the rights of the Plaintiffs to receive the benefits and protections provided for under the PSAs.” (emphases added))). Plaintiffs’ breach-of-contract and breach-of-implied-covenant claims are based on the same alleged facts, and therefore the latter must fail. Defendant’s motion to dismiss Plaintiffs’ claims regarding a breach of an implied covenant of good faith and fair dealing is granted. See, e.g., PL/DB, 172 F. Supp. 3d at 721; Commerzbank AG v. HSBC Bank USA (hereinafter, “CB/HSBC“), No. 15 Civ. 10032 (LGS), 2016 WL 3211978, at *3-4 (S.D.N.Y. June 8, 2016) (collecting cases).

4. The Economic-Loss Doctrine Bars Plaintiffs’ Claims Insofar as They Seek Only the Benefit of Plaintiffs’ Contract

Plaintiffs’ allegations that Defendant breached duties independent of its contracts do not, themselves, “allow evasion of the economic loss rule, which presents a second, distinct barrier” to tort claims stemming from contractual relationships. RP/HSBC, 109 F. Supp. 3d at 599. The economic-loss rule provides that “a contracting party seeking only a benefit of the bargain recovery may not sue in tort notwithstanding the use of familiar tort language in its pleadings.” Phoenix Light SF Ltd. v. U.S. Bank Nat’l Ass’n (hereinafter, “PL/U.S. Bank“), No. 14 Civ. 10116 (KBF), 2016 WL 1169515, at *9 (S.D.N.Y. Mar. 22, 2016) (quotation marks omitted) (quoting 17 Vista Fee Assocs. v. Teachers Ins. & Annuity Ass’n of Am., 693 N.Y.S.2d 554, 559 (1st Dep’t 1999)); accord NCUAB/U.S. Bank II, 2016 WL 796850, at *11. However, “the rule allows such recovery in the limited class of cases involving liability for the violation of a professional duty.” Hydro Inv’rs, Inc. v. Trafalgar Power Inc., 227 F.3d 8, 18 (2d Cir. 2000) (citing 17 Vista Fee Assocs., 693 N.Y.S.2d at 560; Robinson Redev. Co. v. Anderson, 547 N.Y.S.2d 458, 460 (3d Dep’t 1989)). A court considering the application of this doctrine therefore must scrutinize with care a plaintiff’s proffered extra-contractual claims.

Courts in this District have split with regard to the application of the economic-loss doctrine to tort claims brought against an RMBS trustee. Compare RP/HSBC, 109 F. Supp. 3d at 608-10, with PL/U.S. Bank, 2016 WL 1169515, at *9. Dispositive in each case has been the nature of the plaintiff’s claims: Does plaintiff allege damages that flow from the violation of a professional duty, or merely from the violation of the governing agreements? Courts have denied motions to dismiss where plaintiffs have pleaded tort claims grounded in extra-contractual duties. See, e.g., PL/DB, 172 F. Supp. 3d at 719 (holding that, with regard to the economic-loss doctrine, “[t]he dispositive issue is whether [defendant] owed duties to the plaintiffs that were separate from the duties set forth in the PSAs and the Indenture Agreements” and reasoning that because “[s]everal of the plaintiffs’ arguments supporting the negligence, gross negligence, and breach of fiduciary duty claims are not duplicative of the breach of contract claim[,] . . . the motion to dismiss the tort claims cannot be granted on this basis”); RP/HSBC, 109 F. Supp. 3d at 608-10 (denying motion to dismiss with regard to breaches of extra-contract duty to avoid conflicts of interest and post-EOD fiduciary duties, but granting motion to dismiss negligent misrepresentation claim absent a “special duty for [defendant] to refrain from negligently making misrepresentations to Certificateholders”). Conversely, motions to dismiss have been granted where plaintiffs pled only damages arising from a defendant’s contract obligations. See, e.g., PL/U.S. Bank, 2016 WL 1169515, at *9 (“While the cause of action for breach of fiduciary duty may arise from common law duties and not from the PSA, `the injury’ and `the manner in which the injury occurred and the damages sought persuade us that plaintiffs’ remedy lies in the enforcement of contract obligations,’ and is barred by the economic loss doctrine.” (quoting Bellevue S. Assocs. v. HRH Constr. Corp., 78 N.Y.2d 282, 293 (1991))); NCUAB/U.S. Bank II, 2016 WL 796850, at *11 (same).

This Court draws the same line. The economic-loss doctrine does not foreclose Plaintiffs’ claims that Defendant breached its duty to perform ministerial acts with due care and its duty to avoid conflicts of interest. At least at this stage, Plaintiffs have pleaded that Defendant breached extracontractual duties, for which Plaintiffs are owed damages that do not lie simply in the enforcement of Defendant’s contractual obligations. However, insofar as Plaintiffs have pleaded that Defendant breached, for example, its post-EOD fiduciary duty in failing to act as it was contractually required to, the economic-loss doctrine does bar Plaintiffs’ claims. Defendant’s motion to dismiss that subset of Plaintiffs’ tort claims is granted.

5. Defendant’s Motion to Dismiss Plaintiffs’ TIA Claims Is Granted in Part and Denied in Part

i. Plaintiffs’ TIA Claims Regarding PSA-Governed Trusts Are Dismissed

Plaintiffs assert claims under Sections 315(a), (b), and (c) of the TIA.[8] Because claims under the TIA can only be asserted with respect to the 12 Trusts governed by Indenture Agreements, the Court here considers only the viability of those claims; any claims brought under the TIA with respect to the PSA-governed Trusts are dismissed to the extent that Plaintiffs have not already withdrawn them. See PABF III, 775 F.3d at 155 (holding that the TIA does not “impose obligations on the trustees of RMBS trusts governed by pooling and servicing agreements”); PL/DB, 172 F. Supp. 3d at 721 (dismissing TIA claims with respect to PSA-governed trusts on this basis). (See also Def. Br. 22; Pl. Opp. 18 & n.14).

ii. Defendant’s Motion to Dismiss Plaintiffs’ Section 315(a) Claim Is Granted

With respect to the Indenture Trusts, an interesting antecedent issue concerns whether Plaintiffs can bring a TIA claim at all. Sections 315(a), (b), and (c) of the TIA do not afford an express private right of action. See 15 U.S.C. § 77ooo; see also, e.g., Blackrock Allocation Target Shares: Series S Portfolio v. Bank of N.Y. Mellon (hereinafter, “BR/BNYM“), 180 F. Supp. 3d 246, 254 (S.D.N.Y. 2016) (“Section 315 of the TIA does not expressly create a federal private cause of action.”), motion to certify appeal denied sub nom. Blackrock Allocation Target Shares Series S Portfolio v. Bank of N.Y. Mellon, No. 14 Civ. 9372 (GBD), 2016 WL 5812627 (S.D.N.Y. Oct. 4, 2016); Fixed Income Shares, 130 F. Supp. 3d at 848. For Plaintiffs’ claims to proceed, therefore, the Court must find an implied private right of action.

The Court concludes, as have its sister courts in this Circuit, that a private right of action is implied under Sections 315(b) and (c), but not under Section 315(a). Considering first Section 315(a), this Court agrees with the other courts to consider the question that “this [S]ection limits, rather than creates, liability.” RP/BNYM, 2016 WL 899320, at *8. Here, Plaintiffs allege that Defendant violated Section 315(a)(1)’s mandate that “the indenture trustee shall not be liable except for the performance of such duties as are specifically set out in such indenture,” 15 U.S.C. § 77ooo(a), by violating the duties specifically set out in the Indenture Agreements. (NCUAB Compl. ¶ 440; RF Compl. ¶ 175). But Section 315(a)(1) does not impose liability for Indenture Agreement violations; it rather limits possible liability to claims premised on Indenture Agreement violations. Accordingly, Defendant’s motion to dismiss Plaintiffs’ claims under Section 315(a) is granted.

iii. Defendant’s Motion to Dismiss Plaintiffs’ Sections 315(b) and (c) Claims Is Denied

A different result obtains under Sections 315(b) and (c). Neither the Supreme Court nor the Second Circuit has determined whether either section affords an implied private right of action. But the Second Circuit has cited favorably case law consistent with such an implied right. See Bluebird Partners, L.P. v. First Fid. Bank, N.A., 85 F.3d 970, 974 (2d Cir. 1996) (agreeing with observations of Zeffiro v. First Pa. Banking & Tr. Co., 623 F.2d 290 (3d Cir. 1980), “which established a private cause of action under the [TIA]”). And district courts within this Circuit addressing the question more directly have found the same: “[S]everal courts in this [D]istrict have found a private right of action to exist under these [S]ections.” RP/BNYM, 2016 WL 899320, at *8 (collecting cases); see also Fixed Income Shares, 130 F. Supp. 3d at 848 (collecting cases).

Defendant decries Plaintiffs’ reliance on cases like Zeffiro, which it claims are “inconsistent with the Supreme Court’s most recent private right of action jurisprudence — Stoneridge, Sandoval[,] and Armstrong v. Exceptional Child Ctr., Inc., 135 S. Ct. 1378, 1387 (2015) (plurality) — which require express textual indicators of a private action and remedy.” (Def. Br. 22 (parenthetical omitted)). The Court has reviewed that jurisprudence, as well as persuasive authority from this District finding an implied private right of action under Sections 315(b) and (c), and cannot agree with Defendant’s claims.

In Fixed Income Shares, Judge Furman considered this issue with care, specifically grappling with the implications of Sandoval. First, Judge Furman looked to the reasoning of Zeffiro, which reasoning he noted “rel[ied] heavily on the factors articulated by the Supreme Court in Cort v. Ash, 422 U.S. 66, 95 (1975)” and was cited with approval by the Second Circuit in Bluebird. 130 F. Supp. 3d at 848-49. Judge Furman recounted that the Zeffiro court had found that:

Congress intended to create a private right of action under the TIA because [i] the TIA was enacted for the benefit of a special class, namely, debenture holders; [ii] legislative history revealed Congress’s intention “to nationalize the issues of concern in the Act”; [iii] the Securities and Exchange Commission (“SEC”) has no power to enforce the terms of an indenture after it has been qualified under the Act, leaving private lawsuits as the only possible enforcement mechanism; and [iv] “[i]t is unquestionable that Congress intended to legislate over trust indentures and deal with the problem on a national scale.”

Id. (quoting Zeffiro, 623 F.2d at 296-301).

Judge Furman also noted that Judge Mukasey had likewise found the TIA’s “text and legislative history [to] support the inference that Congress intended to permit debenture holders to sue in federal court.” 130 F. Supp. 3d at 849 (quoting LNC Invs., Inc. v. First Fid. Bank, Nat’l Ass’n, 935 F. Supp. 1333, 1339 (S.D.N.Y. 1996)). Both judges “emphasized that the SEC is not entitled to enforce the terms of indentures covered by the TIA.” Id.; see also id. at 849-50. All of this, Judge Furman concluded, together with the lack of evidence supporting a contrary interpretation and the TIA’s legislative history, confirmed that Sections 315(a) and (b) afforded implied private rights of action. Id. at 849-50.

Judge Furman noted, however, that he had been given “pause” by the Supreme Court’s decision in Alexander v. Sandoval, 532 U.S. 275 (2001). 130 F. Supp. 3d at 850. In particular, the court was troubled because Sandoval “reasoned that `[s]tatutes that focus on the person regulated rather than the individuals protected create no implication of an intent to confer rights on a particular class of persons.'” Id. (alteration in original) (quoting Sandoval, 532 U.S. at 289). However, Judge Furman concluded that while “the TIA provisions at issue are phrased in terms of the trustee’s duties rather than the investors’ entitlement,” they differed from those at issue in Sandoval because their focus “is not solely on the [trustee], but also on the individuals [they] protect[ ].” Id. (alterations in original) (quoting Zatuchni v. Richman,No. 07 Civ. 4600, 2008 WL 3408554 (CMR), at *9 (E.D. Pa. Aug. 12, 2008)). “Sections 315(b) and (c) impose specific duties that the trustee must perform to protect investors, and `a statute that imposes fiduciary duties necessarily implies corresponding rights in the beneficiaries.'” Id. (first emphasis added) (quoting Int’l Union of Operating Eng’rs, Local 150, AFL-CIO v. Ward, 563 F.3d 276, 286 (7th Cir. 2009)). Therefore, Sandoval did not persuade Judge Furman “to depart from the longstanding view that a private right of action exists to enforce Sections 315(b) and (c).” Id. Nor has it persuaded other Courts in this District. See e.g., RP/BNYYM, 2016 WL 899320, at *8 (“The Court finds Judge Furman’s analysis of this issue in Fixed Income Shares persuasive and adopts Judge Furman’s conclusions here.”).

Later, in Blackrock Allocation Target Shares, Judge Daniels elaborated on Judge Furman’s Sandoval analysis; Judge Daniels considered whether the Supreme Court’s subsequent decision in Stoneridge Investment Partners, LLC v. Scientific-Atlanta, Inc., 552 U.S. 148 (2008), had “abrogated prior case law holding that the TIA establishes a private cause of action.” BR/BNYM, 80 F. Supp. 3d at 255. In Stoneridge, the Supreme Court held that there may be “an implied cause of action only if the underlying statute can be interpreted to disclose the intent to create one.” 552 U.S. at 164. The Stoneridge Court affirmed Sandoval‘s holding that the express provision of a single method of enforcement suggests a Congressional intent to preclude others. Id. at 163. The Court also, however, distinguished its case from those “in which Congress has enacted a regulatory statute and then has accepted, over a long period of time, broad judicial authority to define substantive standards of conduct and liability.” Id.

Judge Daniels picked up on this distinction, noting that “[c]ourts have unanimously recognized a private cause of action under the TIA for at least thirty-five years.” BR/BNYM, 180 F. Supp. 3d at 255. And he reiterated Judge Furman’s argument that Section 315 imposes specific fiduciary duties, and so necessarily implies corresponding rights in beneficiaries. Id. at 255-56. Judge Daniels, too, determined that neither Sandoval nor Stoneridge precluded recognition of an implied private cause of action under the TIA. Id.; see also Ret. Bd. of the Policemen’s Annuity & Benefit Fund of City of Chi. v. Bank of N.Y. Mellon, No. 11 Civ. 5459 (WHP), 2015 WL 9275680, at *2-3 (S.D.N.Y. Dec. 18, 2015) (Pauley, J.) (holding that Stoneridge and Sandoval “do not contravene the line of authority holding that a private right of action exists under Section 315 of the TIA” because (i) “courts have unanimously interpreted Section 315 as implying a private right of action for at least 35 years” and (ii) Section 315 imposes “fiduciary duties, which necessarily impl[y] corresponding rights in the beneficiaries”), motion to certify appeal denied sub nom. Ret. Bd. of the Policemen’s Annuity & Benefit Fund of City of Chi. v. Bank of N.Y. Mellon, No. 11 Civ. 5459 (WHP), 2016 WL 2744831 (S.D.N.Y. May 9, 2016).

This Court reaches the same conclusion, even after considering the Supreme Court’s plurality decision in Armstrong v. Exceptional Child Center, Inc., ___ U.S. ___, 135 S. Ct. 1378 (2015), which Judges Furman, Daniels, and Pauley did not have occasion to discuss. Armstrong reaffirmed the two Sandoval concerns that prior courts have found the TIA to address: (i) it noted the lack of rights-creating language that conferred a right to sue upon a statute’s beneficiaries, and (ii) it found private enforcement impliedly precluded by the provision of an alternate enforcement mechanism. Id. at 1387. Because here, as Judges Furman, Daniels, and Pauley found, and as longstanding precedent confirms, Sections 315(b) and (c) of the TIA (i) necessarily create rights in their beneficiaries and (ii) do not allow potentially preclusive SEC enforcement, Armstrong does not change this Court’s conclusion that the TIA “unambiguously confer[s]” a private right of action. Id. at 1388. The Court declines Defendant’s invitation to stand alone against the jurisprudential tide.

Because Defendant does not otherwise challenge the viability of Plaintiffs’ TIA claims, the Court denies Defendant’s motion to dismiss Plaintiffs’ TIA claims under Section 315(b) and (c).[9]

6. Defendant’s Motion to Dismiss Plaintiffs’ Streit Act Claims Is Granted

The parties agree that the Streit Act, Article 4A of the New York Real Property Law, does not apply to the 12 Indenture Trusts at issue here. (Def. Br. 24; Pl. Opp. 23 n.18; Def. Reply 10). Accordingly, to the extent that Plaintiffs have pleaded violations of the Streit Act implicating the Indenture Trusts, those claims are dismissed. See, e.g., PL/DB, 172 F. Supp. 3d at 722-23 (citing N.Y. Real Prop. Law § 130-k) (“[O]nly the 45 PSA Trusts are potentially subject to the Streit Act because they are not covered by the TIA.”); RP/HSBC, 109 F. Supp. 3d at 599 (same).

As for the PSA Trusts, Plaintiffs allege that Defendant violated Section 126(1) of the Streit Act when it “failed to exercise its rights under the Governing Agreements after becoming aware of numerous Events of Default, failed to notify Certificateholders and other parties of deficiencies, failed to take steps to address those deficiencies, and . . . failed to enforce the repurchase, cure or substitution of defective Mortgage Loans.” (RP Compl. ¶¶ 198-99; see also NCUAB Compl. ¶¶ 430, 432; PL Compl. ¶¶ 197-98; CB Compl. ¶¶ 165-66).[10] However, Courts in this District have held consistently that Section 126(1) “requires only that trust instruments include certain provisions, and does not itself impose any affirmative duties on trustees.” CB/HSBC, 2016 WL 3211978, at *2; see also id. at 2-3 (collecting cases holding the same, and noting the dearth of support for defendant’s argument to the contrary); PL/DB, 172 F. Supp. 3d at 723 (dismissing Section 126(1) claim because “[§] 126(1) does not create any additional duties for trustees beyond the duties in the PSAs, and only requires that certain types of provisions be included in the indenture agreement,” and plaintiff’s complaint did “not allege that the PSAs omitted” those provisions); accord, e.g., PL/U.S. Bank, 2016 WL 1169515, at *10-11; RP/BNYM, 2016 WL 899320, at *11; NCUAB/U.S. Bank II, 2016 WL 796850, at *12; PL/BNYM, 2015 WL 5710645, at *11.

This Court now adds its voice to the judicial chorus: Plaintiffs fail to plead a claim under Section 126(1) of the Streit Act because Plaintiffs have not pleaded that Defendant accepted a deficient trust instrument and Section 126(1) imposes no further duty.[11]

In several of the operative pleadings, Plaintiffs reference “a duty” imposed “upon the trustee to discharge its duties under the applicable indenture with due care to ensure the orderly administration of the trust and to protect the trust beneficiaries’ rights”; this language echoes Section 124 of the Streit Act. (RP Compl. ¶ 69; see also NCUAB Compl. ¶¶ 13, 100). But only the NCUAB’s Complaint seems to allege that Defendant violated Section 124. (See NCUAB Compl. ¶ 431 (“In addition, Section 124 of the Streit Act imposes a duty upon the trustee to discharge its duties under the applicable indenture with due care in order to ensure the orderly administration of the trust and protect the trust beneficiaries’ rights.” (citing N.Y. Real Prop. Law § 124))). All told, the extent to which Plaintiffs intend to allege violations of Section 124 is unclear. Fortunately, the law is not so ambiguous: Section 124 “is a preliminary section that does not create any duties.” CB/HSBC, 2016 WL 3211978, at *2 (quoting RP/HSBC, 109 F. Supp. 3d at 610); accord NCUAB/U.S. Bank II, 2016 WL 796850, at *12 (“Plaintiff’s claims under Section 124 are not actionable because Section 124 is the preamble to the Streit Act and does not impose any obligations. Instead, it merely recites the New York state legislature’s purpose in enacting the law and its applicability to trustees with offices in New York.”). Therefore, to the extent that Plaintiffs may have brought claims under Section 124 of the Streit Act, those claims are dismissed.

The Court is not persuaded by Plaintiffs’ arguments that these conclusions are not in keeping with the purpose, legislative history, and case law that motivated the Streit Act. (See Pl. Opp. 22-23). The Court’s decision is in keeping with current case law and with the Streit Act’s plain text. Defendant’s motion to dismiss Plaintiffs’ Streit Act claims is granted.[12]

7. Defendant’s Motion to Dismiss NCUAB’s Claims Is Granted in Part, Without Prejudice, and Denied in Part

While most of Defendant’s arguments are applicable to all five Plaintiffs, Defendant mounts individualized arguments against the NCUAB and Commerzbank. Beginning with the former, and because the NCUAB stands in a different position than its peer Plaintiffs, the Court will provide a brief background of the genesis of its claims before considering the issue of its standing.

a. Factual Background

Plaintiff NCUAB manages the NCUA. As relevant here:

The National Credit Union Administration (“NCUA”) is an independent agency of the Executive Branch of the United States Government that, among other things, charters and regulates federal credit unions, and operates and manages the National Credit Union Share Insurance Fund (“NCUSIF”) and the Temporary Corporate Credit Union Stabilization Fund (“TCCUSF”). The TCCUSF was created in 2009 to allow the NCUA to borrow funds from the United States Department of the Treasury (“Treasury Department”) to stabilize corporate credit unions under conservatorship or liquidation, or corporate credit unions threatened with conservatorship or liquidation. The NCUA must repay all monies borrowed from the Treasury Department for the purposes of the TCCUSF by 2021. The NCUSIF insures the deposits of account holders in all federal credit unions and the majority of state-chartered credit unions. The NCUA has regulatory authority over statechartered credit unions that have their deposits insured by the NCUSIF.

(NCUAB Compl. ¶ 17 (citing Federal Credit Union Act, 12 U.S.C. §§ 1751, 1752a(a)). In certain specified circumstances, the NCUAB “may close an insured credit union and appoint itself the Liquidating Agent for such credit union. As liquidating agent for a failed credit union, the [NCUAB] succeeds to all rights, titles, powers, and privileges of the credit union, its members, accountholders, officers, and directors.” (Id.).

At various times in 2010, the NCUAB placed certain corporate credit unions (“CCUs”) into conservatorship, and then into involuntary liquidation, “appointing itself as the liquidating agent.” (NCUAB Compl. ¶ 24). In this capacity, the NCUAB “succeeded to all rights, titles, powers, and privileges of the CCUs and of any member, account holder, officer or director of the CCUs, with respect to the CCUs and their assets, including the right to bring the claims asserted in this action.” (Id. at ¶ 25). As liquidating agent, the NCUAB had the right to “sue on the CCUs’ behalf.” (Id.).

Also in 2010, “the NCUA and the [NCUAB] as liquidating agent created the NCUA Guaranteed Notes Program (the `NGN Program’) as a means of liquidating the distressed investment securities from . . . five failed CCUs (the `Legacy Assets’), thereby stabilizing funding for the credit union system.” (NCUAB Compl. ¶ 27). This program entailed the transfer of certain Legacy Assets, “including the CCU’s investment in the [T]rusts at issue” in this case, to trusts (the “NGN Trusts”). (Id.). To create the NGN Trusts, “the NCUA Board in its Capacity as Liquidating Agent (as Sellers) transferred the [CCUs’ RMBS] certificates to the NGN Trusts (as Issuers) pursuant to the NGN Trust Agreements, and [Defendant] (as Owner Trustee) caused the Owner Trust Certificates . . . to be issued” to the NCUAB. (Id. at ¶ 29). The NGN Trusts are Delaware statutory trusts, created pursuant to and governed by the Delaware Statutory Trust Act, 12 Del. Code §§ 3801-3826 (the “DSTA”). (Pl. Opp. 26).

Once the RMBS certificates were conveyed to the NGN Trusts, and the NCUAB left with only its Owner Trust Certificates, the NGN Trusts executed a second transaction. The Trusts entered into an Indenture Agreement with the Bank of New York Mellon (“BNYM”), through which they “(as Issuers) pledged the [c]ertificates and the other assets of the trust estates to [BNYM] (as Indenture Trustee) and caused . . . Notes to be issued pursuant to the NGN Indentures.” (NCUAB Compl. ¶ 29). “BNYM (as Indenture Trustee) [then] delivered the Notes [to] . . . Initial Purchasers for further sale to investors.” (Id.).

The NGN Trust Agreements facilitated the following exchange: The NCUAB as liquidating agent “transferred and assigned” the former CCU-owned certificates, as well as the NCUAB’s “rights, title, and interest to assert the claims at issue in this [case] to the NGN Trusts,” and in exchange, the NCUAB received “certain certificates that represent a beneficial ownership interest in the NGN Trusts (the `Owner Trust Certificates’).” (NCUAB Compl. ¶ 30). This beneficial ownership interest entitled the NCUAB in its capacity as Liquidating Agent “to payments from the NGN Trusts after the principal balance of the Notes issued by the various NGN Trusts has been reduced to zero.” (Id.; see also id. at ¶ 31). And the NCUA, “in its capacity as an agency of the Executive Branch of the United States Government (in such capacity, the `Guarantor’) provided a guarantee, backed by the full faith and credit of the United States, of the timely repayment of all principal and interest to the investors in the NGN Trusts.” (Id. at ¶ 32; id. at Ex. D).

b. Defendant’s Motion to Dismiss NCUAB’s Derivative Claims Is Granted

Defendant’s standing claim with regard to the NCUAB is intertwined with its challenge to the NCUAB’s claims on their merits: Defendant claims that that the NCUAB lacks standing to assert its derivative claims (which, according to Defendant, are not in fact derivative), and, further, that the NCUAB lacks standing to bring direct claims as well. The Court will consider first the threshold question of the NCUAB’s standing, before addressing the derivative or direct nature of the claims the NCUAB asserts standing to bring.[13]

i. Procedural History

To consider properly the NCUAB’s derivative claims, the Court first revisits events that followed the NGN Trust formation process described above. Critical to the Court’s analysis of the NCUAB’s standing is the fact that through the NGN Indenture Agreement, “BNYM was granted the right to take action against Defendant with respect to the certificates and the Trusts.” (NCUAB Compl. ¶ 33; id. at Ex. B). Specifically, the Granting Clause of the Indenture Agreement gave BNYM as Indenture Trustee “all of [the Trusts’] right, title and interest in and to . . . the Underlying Securities . . ., and all distributions thereon, . . . [and] all present and future claims, demands, causes, and choses in action in respect of the foregoing, including . . . the rights of the [Trusts (as the Issuers)] under the Underlying Securities and Underlying Agreements.” (Id. at Ex. B).

On January 30, 2015, NCUA in its capacity as Guarantor asked BNYM to exercise this right and pursue the claims at issue in the instant action. (NCUAB Compl. ¶ 34). On February 24, 2015, BNYM declined to do so, stating that

BNY Mellon as Indenture Trustee on the various NCUA re-securitization trusts does not intend to pursue the claims outlined in the Amended Complaints[.] We take no position on the merits, but acknowledge and agree that the Guarantor [NCUA] has the right to pursue claims based on the re-securitization Trust Indentures when the Indenture Trustee fails to do so after receiving notice (which we have for the claims in the Amended Complaints).

(Id.; see also id. at Ex. G). In a sworn declaration provided on July 13, 2015, BNYM modified its position regarding the NCUAB’s standing slightly:

BNYM, solely in its capacity as the Indenture Trustee of the NGN Trusts, does not object to NCUA’s pursuit of the NCUA Suits on behalf of the NGN Trusts. BNYM, solely in its capacity as the Indenture Trustee of the NGN Trusts, takes a neutral position with respect to any challenge to NCUA’s standing and leaves it to the decision of the courts presiding over the NCUA Suits. The statements made in this paragraph 5 are made in reliance on NCUA’s statement in its letter to BNYM, dated July 7, 2015, that: “In bringing the NCUA Suits on behalf of the NGN Trusts, the NCUA Board has fully committed to protecting the best interests of the NGN Trusts and the NGN Noteholders. Recoveries on claims brought on behalf of the NGN Trusts will be remitted to the NGN Indenture Trustee for deposit into the NGN Trust accounts.”

(Id.; see also id. at Ex. I).

Subsequently, “for the certificates in the NGN Trusts, the [NCUAB] as liquidating agent” brought the claims in the instant case “derivatively on behalf of the NGN Trusts, and [named] each NGN Trust . . . herein as a nominal defendant.” (NCUAB Compl. ¶ 35). The NCUAB asserts standing to bring its action on three bases: “as liquidating agent [with] an interest in the NGN Trusts as the holder of the NGN Owner Trust Certificates, as an express thirdparty beneficiary of the NGN Trust Indentures, and pursuant to its authority under 12 U.S.C. § 1787 as the liquidating agent of the CCUs.” (Id.).[14]

ii. Analysis

Defendant’s preliminary challenge to the NCUAB’s standing is its argument that the NCUAB cannot vindicate the NGN Trusts’ rights because the Trusts themselves were not entities capable of such vindication; because a trust is not an entity that can sue, another entity cannot sue on its behalf. (Def. Br. 24). Plaintiffs retort that the specific Trusts at issue are an exception to this rule. While common-law trusts may not be entities with the capacity to sue or be sued (id. (citing Tran v. Bank of N.Y.,No. 13 Civ. 580 (RPP), 2014 WL 1225575, at *1 n.4 (S.D.N.Y. Mar. 24, 2014); Bu ex rel. Bu v. Benenson, 181 F. Supp. 2d 247, 249 & n.1 (S.D.N.Y. 2001)), the NGN Trusts are Delaware statutory trusts afforded the capacity to sue and be sued under the DSTA. (Pl. Opp. 30 & nn.30-32). See 12 Del. Code § 3804(a) (establishing that a Delaware statutory trust is a juridical entity that “may sue and be sued”); Nat’l Credit Union Admin. Bd. v. U.S. Bank Nat’l Ass’n (hereinafter, “NCUAB/U.S. Bank I“), No. 14 Civ. 9928 (KBF), 2015 WL 2359295, at *4 (S.D.N.Y. May 18, 2015) (“[T]he NGN Trusts are Delaware statutory trusts, which are separate legal entities with their own indenture trustee. These trusts are statutorily empowered to sue and be sued in their own right.” (citation omitted)). The Court agrees with Plaintiffs.

Accepting the proposition that the DSTA empowers the NGN Trusts to sue, the Court must determine whether the NCUAB may sue derivatively in NGN Trust’s stead. Defendant’s second challenge to the NCUAB’s derivative claims proceeds from its first: Both build on the foundational principle that “[a] plaintiff who asserts a derivative cause of action must establish the existence of a cause of action in the party whose rights are sought to be enforced. A cause of action cannot be derived from a source in which it does not exist.” Waters v. Horace Waters & Co., 201 N.Y. 184, 188 (1911). (See also Def. Br. 25 (citing Fed. R. Civ. P. 23.1 for proposition that derivative action permissible to “enforce a right that the corporation or association may properly assert”)). Defendant argues that the NGN Trusts transferred their rights to sue with regard to the RMBS certificates to BNYM in the Indenture Agreement. (Def. Br. 24-25 (citing NCUAB Compl. Ex. B)). Therefore, it claims, the NCUAB has no right to assert derivative claims on behalf of the NGN Trusts, because the Trusts have no right to sue in the first instance. (Id.).[15]

Again, in analyzing these claims, the Court finds itself traveling what is fast becoming become a well-worn path in this District. Within the past two years alone, both Judges Scheindlin and Forrest have considered challenges to the NCUAB’s standing to bring direct and derivative claims against an RMBS trustee; indeed Judge Forrest has done so twice. See NCUAB/U.S. Bank II, 2016 WL 796850, at *8; Nat’l Credit Union Admin. Bd. v. HSBC Bank USA, Nat. Ass’n (hereinafter, NCUAB/HSBC“), 117 F. Supp. 3d 392, 398-99 (S.D.N.Y. 2015); NCUAB/U.S. Bank I, 2015 WL 2359295, at *4.

In each of their 2015 opinions, Judges Scheindlin and Forrest found that the NCUAB lacked standing at least in part because it had failed to meet the requirements imposed by Federal Rule of Civil Procedure 23.1 and Delaware law to bring a derivative suit. Judge Forrest found that the NCUAB had failed to state a derivative claim on behalf of the NGN trusts because the NCUAB had sued to recover for itself: “[I]f NCUA were in fact acting in a derivative capacity . . . for the NGN Trusts, any recovery would necessarily go to those Trusts.” NCUAB/U.S. Bank I, 2015 WL 2359295, at *5 (citing 12 Del. Code § 3816(a) (“A beneficial owner may bring an action . . . in the right of a statutory trust to recover a judgment in its favor[.]”)). Moreover, the NCUAB had failed to satisfy Rule 23.1’s demand-futility requirement: “Rule 23.1 requires NCUA to `state with particularity’ its efforts to obtain the desired action from persons with authority and `the reasons for not obtaining the action or not making the effort.’ It has failed to do so.” Id. at *6 (citation omitted) (quoting Fed. R. Civ. P. 23.1(b)(3)). Judge Scheindlin reached the same conclusion on two different bases. She found that the NCUAB had failed (i) to verify its complaint as Rule 23.1 requires and (ii) to name the NGN Trusts “as nominal defendants so that they can receive the monetary award in the event of recovery.” NCUAB/HSBC, 117 F. Supp. 3d at 400. Putting these pleading defects to the side, Judge Forrest was more skeptical than Judge Scheindlin with regard to the NCUAB’s standing, but neither judge dismissed the NCUAB’s pleading on such a basis. Compare NCUAB/U.S. Bank I, 2015 WL 2359295, at *5 (reasoning that “if NCUA were in fact acting in a derivative capacity — and if it could — for the NGN Trusts,” the NCUAB would not have sought recovery for itself (emphasis added)), with NCUAB/HSBC, 117 F. Supp. 3d at 399 (“NCUA may, however, assert a claim derivatively on behalf of the NGN Trusts.”). Both judges gave the NCUAB leave to amend its pleading to remedy its standing-related deficiencies. See NCUAB/U.S. Bank I, 2015 WL 2359295, at *6; NCUAB/HSBC, 117 F. Supp. 3d at 404.

Only Judge Forrest had a subsequent opportunity to revisit the question of NCUAB’s standing,[16] and she found that the NCUAB lacked standing. Judge Forrest’s analysis is instructive, and the Court summarizes it here.

Judge Forrest began with every court’s initial task in a putative derivative action: the determination of “who has the right to assert a direct claim, and who stands in a derivative position with regard to that claim.” NCUAB/U.S. Bank II, 2016 WL 796850, at *9. She found that in her case, this analysis was complicated by an assignment of rights that took place in two steps. See id. First, the NCUA as the liquidating agent and seller, transferred all interests it had in the underlying securities to the NGN Trusts, including its right to pursue a claim relating to the underlying RMBS. Id. Second, the NGN Trusts transferred their rights to BNYM, the Indenture Trustee. Id. As did the first, so too did this second transfer divest the transferor of any right to pursue a direct claim. Judge Forrest therefore found that “[t]he party who stands in direct line to assert a derivative claim” was not the plaintiff, “but, rather, the Trustee of the NGN Trust.” Id. The NCUAB stood “twice removed.” Id. “At the very least,” Judge Forrest reasoned, this meant that the NCUAB standing “in a derivative position to an intervening holder of any rights . . . would need to fulfill the Rule 23.1 demand requirement vis-à-vis [Defendant] (Owner Trustee).” Id. at *10. Defendant would then, “if it chose to pursue such claims, be required to make its own demand on BNYM. In other words, a derivative claim based on a derivative claim.” Id.

This conclusion, Judge Forrest found, was confirmed by the “breadth and completeness of the Granting Clause,” the expansive language of which itself “forecloses derivative claims.” NCUAB/U.S. Bank II, 2016 WL 796850, at *10. Allowing that there could be cases in which a party “grant[s] all rights to an underlying asset” but “retain[s] a right to sue directly as a party retaining a beneficial ownership interest,” Judge Forrest found that hers was not such a case: “The contractual agreements together effected a complete transfer of all rights including explicitly the right to sue.” Id. (emphasis omitted).

Unsurprisingly, Plaintiffs take issue with Judge Forrest’s reasoning. Among other criticisms, Plaintiffs argue that Judge Forrest “disregarded the fundamental role of a trustee vis-à-vis its trust and beneficial owners, and erroneously treated the Indenture assignment from the NGN Trust to the Indenture Trustee as divesting NCUA of its ability to bring a derivative claim,” apparently viewing the Indenture Trustee as “an entity entirely separate and apart from its duties and role as trustee to the NGN Trust and its beneficiaries.” (Pl. Opp. 29). Because “BNYM also is a trustee of the NGN Trust with duties flowing directly to beneficial owners, including NCUA,” Plaintiffs argue, the NCUAB is not twice removed from BNYM. (Id. at 29-30). Moreover, Plaintiffs argue that Judge Forrest confused the NCUAB’s rights to bring direct and derivative claims. The NCUAB brings its derivative claim on behalf of the NGN Trusts, on the basis of the Trusts’ right to bring that claim directly and BNYM’s acquiescence to the NCUAB’s suit. (Pl. Opp. 31). The NCUAB admits that it has no standing to bring a direct claim against Defendant on the basis of its beneficial-owner status alone. (Id.). But, citing to the DSTA, the NCUAB argues that as a beneficial owner holding Owner Trust Certificates, it is statutorily authorized “to sue derivatively `if persons with authority to do so have refused to bring the action,’ and where trust `property is held or will be held by a trustee or trustees . . . for the benefit of . . . beneficial owners.” (Id. at 31-32 (citing 12 Del. Code §§ 3801(g), 3816(a))).

This Court reaches the same conclusion as did Judge Forrest, though its reasoning is slightly different. “Under the NGN Trust Agreements, the [NCUAB] as liquidating agent transferred and assigned its rights, title, and interest to assert the claims at issue . . . to the NGN Trusts.” (NCUAB Compl. ¶ 30 (citing Ex. C, NGN Trust Agreement § 3.01)).[17] The NGN Trusts subsequently entered into Indenture Agreements with BNYM, the Indenture Trustee. And “[u]nder the NGN Indentures, BNYM was granted the right to take action against Defendant with respect to the [RMBS] certificates and the Trusts.” (NCUAB Compl. ¶ 33; see also id. at Ex. B (granting BNYM all “right, title, and interest in and to . . . all present and future claims, demands, causes and choses in action in respect of the [RMBS certificates]”)). BNYM was also empowered and authorized

to do all things not inconsistent with the provisions of [the] Indenture that it may deem advisable in order to enforce the provisions hereof or to take any action with respect to a default or an Event of Default hereunder, or to institute, appear in or defend any suit or other proceeding with respect hereto, or to protect the interests of the Noteholders and the Guarantor.

(Id. at Ex. B § 5.01(a)(i)).

Plaintiffs argue that irrespective of the NGN Trusts’ conveyance of their right to bring suits with respect to the certificates to BNYM, BNYM was also a trustee of the NGN Trust with duties flowing directly to beneficial owners. This the Court does not dispute. Plaintiffs’ argument, however, elides the role of the NGN Trusts in the equation. It may be true that BNYM owed duties to the NCUAB as a beneficial owner. But the NCUAB cannot bring a derivative suit simply because it meets certain prerequisites: It is a beneficial owner, and it has made a demand of BNYM. In so arguing, Plaintiffs miss the forest for the trees. The NCUAB may only sue “to enforce a right that [the Trusts] may properly assert but ha[ve] failed to enforce.” Fed. R. Civ. P. 23.1 (emphasis added). And here, there is no underlying right, because the NGN Trusts contracted it away.

Still, the NCUAB insists that the DSTA authorizes its suit. The NCUAB is correct insofar as the DSTA provides that

[a] beneficial owner may bring an action in the Court of Chancery in the right of a statutory trust to recover a judgment in its favor if persons with authority to do so have refused to bring the action or if an effort to cause those persons to bring the action is not likely to succeed.

12 Del. Code. § 3816(a).[18] However, the DSTA also expressly limits this right. It specifies that “[a] beneficial owner’s right to bring a derivative action may be subject to such additional standards and restrictions, if any, as are set forth in the governing instrument of the statutory trust.Id. § 3816(e) (emphasis added).

Here, the NCUAB is a beneficial owner of the NGN Trusts insofar as it is a holder of NGN Owner Trust Certificates (NCUAB Compl. ¶ 30); these gave the NCUAB a beneficial interest in the NGN Trusts, to which Trusts the NCUAB transferred the former-CCUs’ RMBS certificates. (Id. at ¶¶ 29-30). Had this been the only transaction, the NCUAB may well have had standing as a beneficial owner in the NGN Trusts to assert claims against Defendant on the NGN Trusts’ behalf. Those Trusts had a claim as RMBS certificateholders, and the NCUAB may have been able to vindicate their claim in a derivative suit.

This was not the only transaction, however. In the very moment the NGN Trusts became certificateholders, they entered into the Indenture Agreement with BNYM, to which agreement the NCUAB was not a party. In the Indenture Agreement, the NGN Trusts “assign[ed] the Trust Estate as collateral to the Indenture Trustee, to be held by the Indenture Trustee, as security for the benefit of the Noteholders and the Guarantor.” (NCUAB Compl., Ex. B at 5). The NGN Trusts also granted to BNYM all of their “right, title and interest in and to” the Trust Estate as well as “all present and future claims, demands, causes and choses in action.” (Id.). This language effected a broad grant of rights to BNYM. Any right to sue that the NCUAB had against Defendant with regard to the Trust Estate was transferred, along with that Estate, to BNYM.

The Court understands Plaintiffs to be arguing that the NCUAB’s DSTAconferred right to bring a derivative claim exists notwithstanding the Granting Clause; the DSTA created a specific right for Delaware-statutory-trust trustees that could not be, or at least was not here, contracted away by the NGN Trusts. But this argument would require the Court to read the sweeping language of the Granting Clause to have limits that it lacks on its face. This the Court will not do. As Judge Forrest held, the “contract must be read to mean what it says.” NCUAB/U.S. Bank II, 2016 WL 796850, at *10. New York law, which governs the Indenture Agreement (see NCUAB Compl., Ex. B), requires the Court to enforce the plain meaning of contracts when that meaning is clear and unambiguous. See, e.g., Law Debenture Tr. Co. of N.Y. v. Maverick Tube Corp., 595 F.3d 458, 467 (2d Cir. 2010) (quoting Greenfield v. Philles Records, Inc., 98 N.Y.2d 562, 569 (2002)). The Court must do so here. The word “all” must mean “all,” such that “[t]he breadth and completeness of the Granting Clause forecloses derivative claims.” NCUAB/U.S. Bank II, 2016 WL 796850, at *10.

Moreover, reading the DSTA to imply a right that exists despite and unaffected by the parties’ agreements would be inconsistent with the preference that the statute consistently evinces for freedom of contract. Here, “[p]rinciples of contract law trump the principle of pursuing of a claim derivatively upon which plaintiff relies[,]” because that is what the DSTA itself requires. NCUAB/U.S. Bank II, 2016 WL 796850, at *10. The DSTA expressly states that its policy is “to give maximum effect to the principle of freedom of contract and to the enforceability of governing instruments.” 12 Del. Code § 3825(b). And throughout its provisions, the statute establishes default rules, but makes clear that they are subject to modification by contract. See, e.g., id. § 3802(b) (“Except as provided in the governing instrument, a beneficial owner is obligated to the statutory trust to perform any promise to contribute cash, property, or to perform services[.]”); id. § 3803(a) (“Except to the extent otherwise provided in the governing instrument of the statutory trust, the beneficial owners shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit[.]”); id. § 3806(d) (“Unless otherwise provided in a governing instrument, a trustee or beneficial owner or other person shall not be liable to a statutory trust or to another trustee or beneficial owner[.]”). The DSTA permits parties to contract even to eliminate entire categories of rights and liabilities, if that is their preference. See id. § 3806(e) (“A governing instrument may provide for the limitation or elimination of any and all liabilities for breach of contract and breach of duties (including fiduciary duties) of a trustee, beneficial owner or other person to a statutory trust[.]”). And where the DSTA’s default rules are not subject to modification by contract, the statute makes that plain. See, e.g., id. § 3804(e) (“[A] beneficial owner who is not a trustee may not waive its right to maintain a legal action or proceeding in the courts of the State with respect to matters relating to the organization or internal affairs of a statutory trust.”); id. § 3806(e) (“[A] governing instrument may not limit or eliminate liability for any act or omission that constitutes a bad faith violation of the implied contractual covenant of good faith and fair dealing[.]”).

Precisely for this reason, the few cases to interpret the DSTA and similar statutes have affirmed that a court must give force to the parties’ bargain. See Grand Acquisition, LLC v. Passco Indian Springs DST, 145 A.3d 990, 999 (Del. Ch. 2016),as revised (Sept. 7, 2016) (“[T]he prefatory clause in Section 3819 is what indicates that a DST’s governing document may restrict the inspection rights granted under that section.”), aff’d, No. 469, 2016, 2017 WL 836929 (Del. Mar. 3, 2017); Hartsel v. Vanguard Grp., Inc., C.A. No. 5394-VCP, 2011 WL 2421003, at *21 (Del. Ch. June 15, 2011) (“The DSTA is enabling in nature and, as such, permits a trust through its declarations of trust to delineate additional standards and requirements with which a stockholder-plaintiff must comply to proceed derivatively in the name of the trust. The Declarations for both [Delaware statutory trusts] have done just that[.]”), aff’d, 38 A.3d 1254 (Del. 2012); cf. Elf Atochem N. Am., Inc. v. Jaffari, 727 A.2d 286, 293-94 (Del. 1999) (“Although [plaintiff] correctly points out that Delaware law allows for derivative suits against management of an LLC, [plaintiff] contracted away its right to bring such an action in Delaware and agreed instead to dispute resolution in California.”).

Here, the contracts are clear. The Trust Agreement established that the NCUAB was “the sole beneficial owner of the portion of the [RMBS certificates] it [was] conveying to the Trust.” (NCUAB Compl., Ex. C, § 2.10(iv)). In Section 3.01, the NCUAB agreed that it would “contribute, transfer, convey and assign to, and deposit with, the Trust, without recourse, all of such Seller’s right, title and interest in and to the portion of the Trust Estate consisting of such Seller’s portion of the [RMBS certificates].” (Id. at § 3.01 (emphasis added)). And this conveyance was to be “absolute,” and also was “intended by the parties, other than for federal, state and local income and franchise tax purposes, to constitute a sale of the [RMBS certificates] and all other assets constituting the Trust Estate by each Seller to the Trust.” (Id. at § 2.14(b)). Beneficial owners were expressly left without “legal title to any part of the Trust Estate solely by virtue of their status as Certificateholders.” (NCUAB Compl. ¶ 10.02). Thus, all of the NCUAB’s rights regarding the RMBS securities were conveyed to the NGN Trusts. Then, as previously discussed, the Trusts conveyed all of their interests in those securities to the Indenture Trustee BNYM.

In sum: The NCUAB lacks standing to bring a derivative claim against Defendant on behalf of the NGN Trusts because the NGN Trusts lack standing to bring a claim against Defendant, having transferred all rights to such claim to BNYM through the Indenture Agreement. Defendant’s motion to dismiss the NCUAB’s derivative claims is granted.

c. Defendant’s Motion to Dismiss the NCUAB’s Direct Claims Is Denied

Separately, Defendant opposes the NCUAB’s standing to bring certain direct claims “arising from certificates previously held by a `recently unwound’ NGN Trust.” (Def. Br. 30 (citing NCUAB Compl. ¶ 26 & n.2)). Defendant asserts that this Court must assess the NCUAB’s standing as of the original complaint, despite the NCUAB’s subsequent amendment thereof. (Id.). In support of this argument, Defendant quotes language attributed to an unpublished Memorandum Decision and Order issued by Judge Forrest on May 11, 2016: “The subsequent winding-down of one NGN trust does not . . . change the fact that at the time NCUA brought this suit, it did not have standing to pursue claims on behalf of the NGN trusts.” (Def. Br. 30 (citing 14 Civ. 9928, Dkt. #141)).

As a preliminary matter, the Court agrees with the NCUAB that Defendant here confuses the standards for Article III standing and “real-partyin-interest” status. (Pl. Opp. 33-34). “The Second Circuit has held that when defendants assert that a party other than plaintiff has standing, `their unspoken premise [is] that [plaintiffs] lacked standing because [the non-party] remained . . . the real party in interest.'” Abu Dhabi Commercial Bank v. Morgan Stanley & Co. Inc., 888 F. Supp. 2d 478, 484 (S.D.N.Y. 2012) (quoting Advanced Magnetics, Inc. v. Bayfront Partners, Inc., 106 F.3d 11, 20 (2d Cir. 1997)) (citing Dayton Monetary Assocs. v. Donaldson, Lufkin & Jenrette Sec. Corps., No. 91 Civ. 2050, 1998 WL 236227 (SHS), at *6 (S.D.N.Y. Mar. 31, 1998) (noting that in such a situation, the distinction between “real party in interest” and a lack of standing is “merely semantic”)). Here, Defendant’s real concern with respect to standing is whether the NCUAB was the proper owner of its direct claims at the time it brought the instant action; in other words, a concern that the NCUAB may not have been the “real party in interest” when it originally brought its claims. See Digizip.com, Inc. v. Verizon Servs. Corp., 139 F. Supp. 3d 670, 679 (S.D.N.Y. 2015). Such an argument implicates Federal Rule of Civil Procedure 17(a), rather than Article III. See id. (considering difference between Rule 17’s implication of “the prudential aspect of standing” and an argument under Article III).[19]

Considered as such, Defendant’s argument fails. As explained above, the NGN Trusts transferred all rights to assert claims regarding the certificates comprising the Trust Estate to BNYM in the Indenture Agreement. However, these rights reverted to the NCUAB as the NGN Trusts were unwound and the RMBS certificates conveyed back. (Pl. Opp. 33 (citing NCUAB Compl. ¶ 26 n.2)). Rule 17 “allows for the substitution of a real party in interest,” see In re SLM Corp. Sec. Litig., 258 F.R.D. 112, 115 (S.D.N.Y. 2009), and the Second Circuit instructs that “Rule 17(a) substitution of plaintiffs should be liberally allowed,” House of Europe Funding I Ltd. v. Wells Fargo Bank, N.A., No. 13 Civ. 519 (RJS), 2015 WL 5190432, at *2 (S.D.N.Y. Sept. 4, 2015) (quoting Advanced Magnetics, 106 F.3d at 20). Here, NCUAB’s substitution of itself as the direct claimant for itself as a derivative claimant would only replace an incorrect party with the real party in interest. The Court does not expect that substitution would “alter[] the original complaint’s factual allegations as to the events or the participants.” House of Europe Funding I Ltd., 2015 WL 5190432, at *2 (quoting Advanced Magnetics, 106 F.3d at 20). Defendant’s motion to dismiss the NCUAB’s direct claims on this basis is denied.

d. The Dismissal of the NCUAB’s Derivative Claims Is Without Prejudice

Defendant contends that the NCUAB’s dismissal should be with prejudice. (Def. Br. 26). It argues that allowing the NCUAB to amend its pleading would cause undue delay and prejudice, and would moreover be futile absent a basis to relate back the NCUAB’s new claims. (Id. at 27-29).

Plaintiffs dispute each of these claims. They remind the Court of the liberal standard afforded by Rule 17 for substitution. (Pl. Opp. 32). They further explain that the NCUAB did not amend its complaint earlier because it believed in good faith that the case law in this area was in flux, and was awaiting the Court’s disposition of the issue in this case. (Id.). And Plaintiffs assert that there is no relation-back problem because Rule 17 provides that a substituted party’s “claims will relate back to the date of the original complaint.” (Id. (quotation marks omitted) (quoting Advanced Magnetics, 106 F.3d at 21)).

The Court agrees with Plaintiffs. If the NCUAB still wishes to amend its pleading, it may move the Court for leave to do so. However, the NCUAB is advised that it will have to identify the party with whom it will replace itself and explain how such a substitution would rectify the standing deficiencies identified above. The NCUAB must further address, in detail, the contemplated impact that a substitution (and, conversely, a failure to substitute) would have on this case, particularly the ongoing discovery schedule.

8. Defendant’s Motion to Dismiss Commerzbank’s Claims as Untimely Is Denied

Finally, Defendant raises a claim of timeliness solely as to Commerzbank, resolution of which requires a determination of the applicable statute of limitations. “Under New York’s `borrowing statute,’ a case filed by a non-resident plaintiff requires application of the shorter statute of limitations period, as well as all applicable tolling provisions, provided by either New York or the state where the cause of action accrued.” Cantor Fitzgerald Inc. v. Lutnick, 313 F.3d 704, 710 (2d Cir. 2002) (citation omitted) (citing N.Y. C.P.L.R. § 202); Antone v. Gen. Motors Corp., Buick Motor Div., 64 N.Y.2d 20, 26 (1984)).[20] “New York follows `the traditional definition of accrual — a cause of action accrues at the time and in the place of the injury.'” Cantor Fitzgerald Inc., 313 F.3d at 710 (quoting Glob. Fin. Corp. v. Triarc Corp., 93 N.Y.2d 525, 529 (1999)); see also Commerzbank AG v. Deutsche Bank Nat’l Tr. Co. (hereinafter, “CB/DB“), No. 15 Civ. 10031 (JGK), 2017 WL 564089, at *5 (S.D.N.Y. Feb. 10, 2017) (citing Portfolio Recovery Assocs., LLC v. King, 14 N.Y.3d 410, 416 (2010) (noting that, where a cause of action has been assigned, the question of where and when the cause of action accrued focuses on the original assignor)). And “[w]here, as here, the `injury is purely economic, the place of injury usually is where the plaintiff resides and sustains the economic impact of the loss.'” Cantor Fitzgerald Inc., 313 F.3d at 710 (quoting Global Fin. Corp., 93 N.Y.2d at 529); see also Norex Petroleum Ltd. v. Blavatnik, 23 N.Y.3d 665, 671 (2014) (“As a resident of Alberta, Canada, alleging purely economic injuries, [plaintiff’s] injuries accrued in Alberta.”). For purposes of the borrowing statute, the residency of a corporate plaintiff is typically the corporation’s place of incorporation or principal place of business. See, e.g., CB/DB, 2017 WL 564089, at *5; IKB Deutsche Industriebank AG v. McGraw Hill Fin., Inc., No. 14 Civ. 3443 (JSR), 2015 WL 1516631, at *3 (S.D.N.Y. Mar. 26, 2015) (finding that corporate plaintiff resided in Germany because it was incorporated and had its principal place of business in Germany), aff’d, 634 F. App’x 19 (2d Cir. 2015) (summary order).

At the outset, the Court notes that the following facts are not in dispute: (i) the applicability of New York’s statute of limitations; (ii) the economic nature of Commerzbank’s alleged injuries; (iii) Commerzbank’s residency in Germany, on the basis of its incorporation and maintenance of its principal place of business in that country; and (iv) the fact that Commerzbank is asserting claims assigned to it by Dresdner Bank, a German entity; Eurohypo AG New York Branch, a German entity; Barrington II CDO Ltd., a Cayman Islands entity; and Palmer Square 3 Limited, an Irish entity. (CB Compl. ¶¶ 16-17).[21] The parties’ central disagreement is this: Defendant argues that Commerzbank’s claims are untimely under the three-year statute of limitations imposed by German Civil Code § 195, because Commerzbank knew before January 1, 2012, of Defendant’s alleged breaches. (Def. Br. 31-33). Commerzbank retorts that (i) it alleged ongoing breaches throughout Defendant’s tenure as Trustee; (ii) the identification of the place of accrual presents a question of fact ill-suited for resolution at this stage; and (iii) even if its claims accrued in Germany, Defendant has not shown they are untimely under German law. (Pl. Opp. 34-40). The Court notes that a nearly identical argument was presented to and resolved by Judge Koeltl very recently in a case also brought by Commerzbank. See CB/DB, 2017 WL 564089, at *5-9.[22] The Court is aided here by Judge Koeltl’s thoughtful analysis, and reaches the same conclusion.

First, the Court rejects Commerzbank’s invocation of the “financial base” exception to New York’s accrual rules. Commerzbank argues that German law may not apply because

Commerzbank’s acquisitions and other activities related to certificates were conducted at and through Commerzbank AG London Branch (“London Branch”), which is a separate financial base[,] and “[w]here a plaintiff maintain[s] [a] separate financial base and where the impact of the financial loss is felt at that location, it may constitute an alternative place of injury” under the New York borrowing statute.

(Pl. Opp. 35-36 (alterations in original) (quoting Beana v. Woori Bank, No. 05 Civ. 7018 (PKC), 2006 WL 2935752, at *6 (S.D.N.Y. Oct. 11, 2006))). But as Judge Koeltl found, no law supports the equation of a separate branch with a separate base. See CB/DB, 2017 WL 564089, at *6. On the contrary, case law abounds supporting a distinction between the two. Id. (collecting cases).

Even if a branch could constitute a base, Commerzbank has not made any effort to show that this case is one of the “extremely rare case[s] where the party has offered unusual circumstances” to justify the Court’s employment of the financial-base exception. CB/DB, 2017 WL 564089, at *6 (alteration in original) (quotation marks omitted) (quoting Deutsche Zentral-Genossenchaftsbank AG v. HSBC N. Am. Holdings, Inc., No. 12 Civ. 4025 (AT), 2013 WL 6667601, at *5 (S.D.N.Y. Dec. 17, 2013)). The pleading language considered by Judge Koeltl is identical to the language included in Commerzbank’s Complaint in the instant case: “The sales of the Sold Certificates were made by London Branch and the economic losses from those sales were experienced in Commerzbank in England and/or in Germany where Commerzbank is located.” (Compare CB Compl. ¶ 132, with CB/DB, 2017 WL 564089, at *6). Considering this language, Judge Koeltl concluded that it was apparent that Commerzbank could not “establish the presence of unusual circumstances . . ., such as a showing that it was operating so far outside of normal corporate banking existence at the time its claims accrued that they could not be said to have accrued in Germany.” CB/DB, 2017 WL 564089, at *6. Judge Koeltl also rejected Commerzbank’s attempt to circumvent this finding by casting it as a factual determination inappropriate for resolution on a motion to dismiss. Id. at *7.

Considering the very same language as did Judge Koeltl, this Court reaches the very same conclusion. “Even if all of the material decisions with respect to the purchase of the Certificates were made at the London branch of Commerzbank, Commerzbank ultimately felt its economic losses at its principal place of business and state of incorporation: Germany.” CB/DB, 2017 WL 564089, at *6. Because the law is clear that “Commerzbank’s branches have no separate existence from Commerzbank,” this conclusion is apparent from the face of Commerzbank’s Complaint, and the Court needs no discovery to reach it. Id. at *7. Commerzbank must show that each of its claims is timely under German law.

Finding that German law applies, the Court must consider whether it bars Commerzbank’s claims. The silver lining of the “proliferation of RMBS litigation in America involving claims that accrued in Germany” is that “American courts have recently had the opportunity to interpret the German statute of limitations applicable to this case.” CB/DB, 2017 WL 564089, at *7. The parties, the parties’ experts, and recent case law agree on the applicable provisions of German law, and their general requirements:

[T]he relevant provision of German law is Section 195 of the German Civil Code, which has a three-year limitations period. That period begins to run at the end of the calendar year in which [i] the claim arose and [ii] the plaintiff either has knowledge of the circumstances giving rise to the claim and the identity of the defendant, or would have had such knowledge but for gross negligence. [U]nder German law, a plaintiff has knowledge of the circumstances giving rise to the claim when she obtains knowledge of the facts necessary to commence an action in Germany with an “expectation of success” or “some prospect of success,” though not without risk and even if the prospects of success are uncertain[.] To satisfy this standard, a plaintiff need not know all the relevant details or have conclusive proof available; knowledge of the factual circumstances underlying the claim is sufficient.

Id. at *7-8 (quoting IKB Deutsche Industriebank AG v. McGraw Hill Fin., Inc., 634 F. App’x 19, 22 (2d Cir. 2015) (summary order)). (See also Sidman Decl., Ex. 20; Kane Decl., Ex. 3).[23]

Defendant argues that “Commerzbank has affirmatively alleged that it had knowledge of [Defendant’s] alleged breaches prior to January 1, 2012” because Commerzbank pled that at the time of its sale of certain RMBS certificates in 2011, “it was apparent that Wells Fargo had breached its duties and would not take steps to remedy its failures.” (Def. Br. 32 (quoting CB Compl. ¶ 132)). But the Court cannot find this admission, even together with Commerzbank’s 2011 lawsuit “against several rating agencies in connection with RMBS” (id.), sufficient to prove that the German statute of limitations accrued on or before the end of 2011. The German standard for accrual is high: “Under German law, Commerzbank must have had sufficient knowledge of each element of each of its claims with respect to each Trust for Section 195 to bar all of the claims that accrued in Germany.” CB/DB, 2017 WL 564089, at *8. And courts in this Circuit are skeptical of “[l]imitations-based arguments in RMBS fraud actions . . . at the motion to dismiss phase,” given the difficulty that inheres in such cases for plaintiffs “in obtaining sufficient notice of the facts underlying their claims.” Id. at *8 (quotation marks omitted) (quoting HSN Nordbank AG v. RBS Holdings USA Inc., No. 13 Civ. 3303 (PGG), 2015 WL 1307189, at *6 (S.D.N.Y. Mar. 23, 2015)(collecting cases)).

This Court shares this skepticism. Ultimately, it cannot determine, from the face of the Complaint, “that Commerzbank had sufficient knowledge of each element of each of its claims with respect to each, or any, Trust [at the relevant time] such that it could have commenced this action with an expectation, or some prospect, of success.” CB/DB, 2017 WL 564089, at *8. Discovery may prove Defendant’s timeliness challenge meritorious, but the Court cannot find it so at this stage. Defendant’s motion to dismiss Commerzbank’s Complaint as untimely under German law is denied.[24]

CONCLUSION

For the foregoing reasons, Defendant’s motion is GRANTED IN PART and DENIED IN PART as described in the text of this Opinion. If the NCUAB still wishes to amend its pleading, it is directed to move the Court for leave to do so within two weeks of this Opinion and Order.

The Clerk of Court is directed to terminate the following motions: in Case No. 14 Civ. 9371, the motion pending at Docket Entry #169; in Case No. 14 Civ. 9764, the motion pending at Docket Entry #113; in Case No. 14 Civ. 10067, the motion pending at Docket Entry #126; in Case No. 14 Civ. 10102, the motion pending at Docket Entry #111; and in Case No. 15 Civ. 10033, the motion pending at Docket Entry #56.

SO ORDERED.

[1] Specifically, Defendant has moved to dismiss each of the five operative complaints in these actions: (i) the Amended Complaint in the action brought by certain BlackRock funds (“BlackRock”) and others (the “BR Compl.,” 14 Civ. 9371, Dkt. #102-06); (ii) the Amended Complaint in the action brought by Royal Park Investments SA/NV (“Royal Park”) (the “RP Compl.,” 14 Civ. 9764, Dkt. #24); (iii) the Second Amended Complaint in the action brought by the National Credit Union Administration Board (the “NCUAB”) (the “NCUAB Compl.,” 14 Civ. 10067, Dkt. #82), (iv) the Second Amended Complaint in the action brought by Phoenix Light SF Ltd. (“Phoenix Light”) and others (the “PL Compl.,” 14 Civ. 10102, Dkt. #80); and the Complaint in the action brought by Commerzbank AG (“Commerzbank”) (the “CB Compl.,” 15 Civ. 10033, Dkt. #1) (all five complaints, collectively, the “Complaints”). Because Defendant’s five motions are contained in a consolidated brief, the Court will refer to them in this Opinion as a single motion.

[2] This Opinion draws the facts in this section from the Complaints. The Court takes all well-pleaded allegations therein as true, as it must at this stage. See, e.g., Peralta v. St. Luke’s Roosevelt Hosp., No. 14 Civ. 2609 (KPF), 2015 WL 3947641, at *1 n.1 (S.D.N.Y. June 26, 2015). The Court has also reviewed the briefing submitted by the parties and will refer to it as follows: Defendant’s Memorandum of Law in Support of Defendant’s Motion to Dismiss the Complaints (14 Civ. 9371, Dkt. #171) will be referred to as “Def. Br.,” Plaintiffs’ Joint Opposition to Defendant’s Motion to Dismiss (14 Civ. 9371, Dkt. #201) as “Pl. Opp.,” and Defendant’s Reply Brief in Further Support of Defendant’s Motion to Dismiss (14 Civ. 9371, Dkt. #208) as “Def. Reply.” Declarations in support of this briefing and exhibits attached thereto are referred to by the name of the declarant and the exhibit designation, e.g., “[ ] Decl., Ex. [ ].”

[3] The Court cites to this Complaint for simplicity’s sake. Each of the Complaints contains a comparable description of RMBS trusts.

[4] Defendant clarifies that while “Plaintiffs’ complaints identify claims on behalf of 59 RMBS trusts, . . . six of those trusts overlap with each other among the various actions.” (Def. Br. 2 n.2).

[5] At the time, there was a fifth related case that has since been separated from the original four, over which this Court does not preside, and which therefore is not at issue in this Opinion: Blackrock Balanced Capital Portfolio (FI) v. Deutsche Bank Nat’l Tr. Co., No. 14 Civ. 9367 (JMF). To avoid confusion, this Court in this section only refers to Defendant Wells Fargo.

[6] Defendant also cites an oral ruling by New York State Supreme Court Justice Charles E. Ramos “that discovery or actual knowledge cannot be inferred from generic public information about originator and servicer misconduct.” (Def. Br. 10). This decision is not germane to the Court’s analysis here, where Plaintiffs have alleged knowledge on the basis of far more than generic public information.

[7] The Court shares Judge Koeltl’s dismay with regard to Plaintiffs’ mode of pleading: Plaintiffs’ complaints include “discursive histor[ies]” of Defendant’s conduct and then include “all of those allegations by incorporation in all the specific causes of action including . . . for breach of fiduciary duty and for negligence and gross negligence.” Phoenix Light SF Ltd. v. Deutsche Bank Nat’l Tr. Co., 172 F. Supp. 3d 700, 718 n.8 (S.D.N.Y. 2016). This presents the Court with the difficult task of untangling a mass of allegations to determine whether they may support actionable tort claims. “This form of pleading is not ideal and leaves to further motion practice a realistic determination of the scope of the tort claims in this case.” Id.

[8] “The [TIA] was enacted because previous abuses by indenture trustees had adversely affected `the national public interest and the interest of investors in notes, bonds [and] debentures,’ and Congress sought to address this national problem in a uniform way.” Bluebird Partners, L.P. v. First Fid. Bank, N.A. N.J., 85 F.3d 970, 974 (2d Cir. 1996) (citations omitted) (quoting 15 U.S.C. § 77bbb(a)) (citing S. Rep. No. 248, 76th Cong., 1st Sess. 3 (1939)). “The Act is `designed to vindicate a federal policy of protecting investors.'” Id. (emphasis omitted) (quoting In re Nucorp Energy Sec. Litig., 772 F.2d 1486, 1489 (9th Cir. 1985)). As relevant here, Section 315(a) provides that, prior to default,

(1) the indenture trustee shall not be liable except for the performance of such duties as are specifically set out in such indenture; and (2) the indenture trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, in the absence of bad faith on the part of such trustee, upon certificates or opinions conforming to the requirements of the indenture; but the indenture trustee shall examine the evidence furnished to it pursuant to [S]ection 77nnn of this title to determine whether or not such evidence conforms to the requirements of the indenture.

15 U.S.C. § 77ooo(a). Section 315(b) requires that

[t]he indenture trustee shall give to the indenture security holders . . . notice of all defaults known to the trustee, within ninety days after the occurrence thereof: Provided, That such indenture shall automatically be deemed (unless it is expressly provided therein that such provision is excluded) to provide that, except in the case of default in the payment of the principal of or interest on any indenture security, or in the payment of any sinking or purchase fund installment, the trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors and/or responsible officers, of the trustee in good faith determine that the withholding of such notice is in the interests of the indenture security holders.

Id. at § 77ooo(b). And Section 315(c) dictates that

[t]he indenture trustee shall exercise in case of default (as such term is defined in such indenture) such of the rights and powers vested in it by such indenture, and to use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs.

Id. at § 77ooo(c).

[9] This resolution is critical to the Court’s jurisdiction in this case: “[A]n affirmative answer” to the private-right-of-action question “is necessary to support jurisdiction.” LNC Invs., Inc. v. First Fid. Bank, Nat’l Ass’n, 935 F. Supp. 1333, 1338 (S.D.N.Y. 1996). The parties here have not disputed this Court’s jurisdiction, though a lack thereof with regard to the PSA-governed claims was dispositive in Judge Berman’s Decision and Order resolving Defendant’s first motion to dismiss. See Blackrock Allocation Target Shares v. Deutsche Bank Nat’l Tr. Co., No. 14 Civ. 9367 (RMB), 2016 WL 269570, at *1 (S.D.N.Y. Jan. 19, 2016). Judge Berman found that he could exercise supplemental jurisdiction because “there arguably [could] be sufficient facts `to demonstrate that the claims relating to the PSA Trusts form part of the same case or controversy as those relating to the Indenture Trusts.'” Id. at *4 (quoting Fixed Income Shares: Series M v. Citibank N.A., 130 F. Supp. 3d 842, 851 (S.D.N.Y. 2015)). However, Judge Berman declined to exercise supplemental jurisdiction because he found (i) the state-law claims substantially predominated over the federal claims, (ii) judicial economy would not be furthered by such an exercise, and (iii) there was evidence that Plaintiffs were engaging in forum-shopping. Id. at *4-5. Judge Berman granted Defendant’s motion to dismiss, but provided Plaintiffs with leave to replead. Id. at *5.

Plaintiffs amended. Because (i) Judge Berman was correct in finding that he could exercise supplemental jurisdiction; (ii) Plaintiffs’ federal Trust claims are no longer as numerically overwhelmed, and therefore substantially predominated, by Plaintiffs’ PSA Trust claims; (iii) discovery in this case has progressed significantly since Judge Berman’s Decision and Order; and (iv) Defendant has not moved the Court to withhold supplemental jurisdiction over Plaintiffs’ PSA Trust claims, the Court affirms here that it has and is exercising supplemental jurisdiction over Plaintiffs’ state-law claims. See 28 U.S.C. § 1367.

[10] That section provides:

No trustee shall hereafter accept a trust under any trust indenture or mortgage within the contemplation of this article or act as trustee thereunder unless the instrument creating the trust shall contain the following provisions, among others, which confer the following powers and impose the following duties upon the trustees:

1. In the case of an event of default (as such term is defined in such instrument), to exercise such of the rights and powers vested in the trustee by such instrument, and to use the same degree of care and skill in their exercise as a prudent man would exercise or use under the circumstances in the conduct of his own affairs.

N.Y. Real Prop. Law § 126(1).

[11] Plaintiffs raise for the first time in their opposition brief the existence of an additional duty under Section 130-e. (Pl. Opp. 23). However, Plaintiffs do not allege that any duty imposed by Section 130-e was violated by Defendant, nor have they pleaded any such violation. Accordingly, the Court will not consider the viability of a Streit Act claim under Section 130-e. Moreover, the Court is skeptical that such a claim could succeed even if pleaded properly. See Commerzbank AG v. Deutsche Bank Nat’l Tr. Co., No. 15 Civ. 10031 (JGK), 2017 WL 564089, at *10 (S.D.N.Y. Feb. 10, 2017) (“The exclusive remedy afforded to an aggrieved party under Section 130-e is the removal of the trustee. [Plaintiff] has not pleaded that it is entitled to such relief.”).

[12] “Because Defendant’s motion is granted as to the Streit Act claim[s], the Court does not address whether the Streit Act applies to RMBS trusts or whether it provides a private cause of action for damages.” Phoenix Light SF Ltd. v. Bank of N.Y. Mellon, No. 14 Civ. 10104 (VEC), 2015 WL 5710645, at *11 n.11 (S.D.N.Y. Sept. 29, 2015).

[13] Defendant originally challenged the standing of both the NCUAB and Royal Park with regard to the derivative claims brought by each. Royal Park has subsequently abandoned its derivative claims. (Pl. Opp. 33 n.34 (“Royal Park’s action was brought as a class action, or in the alternative, derivatively in the right and for the benefit of the Covered Trusts against Wells Fargo. In light of recent authority, which has no effect on NCUA’s claims whatsoever, Royal Park is electing to proceed only on a class basis.” (citing RP Compl. ¶¶ 1-2; Royal Park Invs. SA/NV v. Deutsche Bank Nat’l Tr. Co., No. 14 Civ. 4394 (AJN), 2016 WL 439020, at *6 (S.D.N.Y. Feb. 3, 2016)))).

[14] In its opening brief, Defendant argues that Plaintiffs may not bring derivative actions on behalf of RMBS Trusts because such claims can only be brought directly, by investors in those Trusts; the RMBS Trusts themselves were not the parties who suffered the alleged harm and who would receive the benefit of recovery. (Def. Br. 29-30 (citing Yudell v. Gilbert, 949 N.Y.S.2d 380, 381 (1st Dep’t 2012) (adopting the test for determining whether a claim is direct or derivative established in Tooley v. Donaldson, Lufkin, & Jenrette, Inc., 845 A.2d 1031 (Del. 2004))). But, as Plaintiffs clarify, the NCUAB has not attempted to bring derivative claims on behalf of the RMBS trusts for which Defendant serves as Trustee. (Pl. Opp. 33). The NCUAB’s derivative claims are brought on behalf of the NGN Trusts, in the NGN Trusts’ capacity as RMBS certificateholders. Defendant abandoned this argument on reply, and so the Court will consider it no further in the following section. Defendant’s motion to dismiss any derivative claims brought on behalf of the RMBS Trusts is denied as moot, because, as the NCUAB affirms, the NCUAB has brought no such claims.

The Court also will not consider whether the NCUAB has standing to sue on behalf of the NGN Trusts “as an express third-party beneficiary of the NGN Trust Indentures, and pursuant to its authority under 12 U.S.C. § 1787 as the liquidating agent of the CCUs.” (NCUAB Compl. ¶ 35). Defendant has not challenged and Plaintiffs have not defended the NCUAB’s standing on these bases. Moreover, the courts in this District to have considered the question have found that neither the NCUAB’s third-party-beneficiary status nor its authority under 12 U.S.C. § 1787 afford it standing to sue. See Nat’l Credit Union Admin. Bd. v. HSBC Bank USA, Nat’l Ass’n, 117 F. Supp. 3d 392, 398-99 (S.D.N.Y. 2015); Nat’l Credit Union Admin. Bd. v. U.S. Bank Nat’l Ass’n, No. 14 Civ. 9928 (KBF), 2015 WL 2359295, at *4 (S.D.N.Y. May 18, 2015). For the reasons those Courts articulated, this Court would find the same.

[15] As an aside, the Court notes that Defendant brought its motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) rather than under Rules 12(b)(1) (permitting dismissal for lack of subject-matter jurisdiction) or 23.1 (establishing prerequisites and pleading requirements for derivative suits). And this distinction is not without import: “In contrast to a motion to dismiss pursuant to Rule 12(b)(6),” for example, “a Rule 23.1 motion to dismiss for failure to [meet the rule’s pleading requirements] is not intended to test the legal sufficiency of the plaintiffs’ substantive claim. `Rather, its purpose is to determine who is entitled, as between the corporation and its shareholders, to assert the plaintiff’s underlying substantive claim on the corporation’s behalf.” In re Veeco Instruments, Inc. Sec. Litig., 434 F. Supp. 2d 267, 273 (S.D.N.Y. 2006) (quoting Levine v. Smith, 1989 WL 150784, at *5 (Del. Ch. 1989), aff’d, 591 A.2d 194 (Del. 1991)). Similarly, a motion under Rule 12(b)(6) differs from a motion under Rule 12(b)(1): “[A] typical dismissal under Rule 12(b)(6), i.e., for failure to state a claim, is an adjudication on the merits with preclusive effect,” All. for Envtl. Renewal, Inc. v. Pyramid Crossgates Co., 436 F.3d 82, 88 n.6 (2d Cir. 2006), while dismissals for lack of standing are without prejudice, Wyatt v. Fed. Commc’ns Comm’n, No. 15 Civ. 1935 (WHP), 2016 WL 4919958, at *2 n.3 (S.D.N.Y. Sept. 14, 2016). Moreover, while a Rule 12(b)(1) motion permits a court to consider evidence outside the pleadings, a Rule 12(b)(6) motion typically does not. See Goel v. Bunge, Ltd., 820 F.3d 554, 558-59 (2d Cir. 2016); Tandon v. Captain’s Cove Marina of Bridgeport, Inc., 752 F.3d 239, 243 (2d Cir. 2014). Here, the Court finds Defendant’s decision to move only under Rule 12(b)(6) to be curious, because the substance of Defendant’s Rule 12(b)(6) argument with regard to the NCUAB’s standing is that the NCUAB lacks standing “to enforce a right” that the NGN Trusts “may properly assert” because the NGN Trusts have no such right. See Fed. R. Civ. P. 23.1.

[16] The defendant in Judge Scheindlin’s case, which was reassigned to Judge Schofield on April 19, 2016, did not file a renewed motion to dismiss NCUAB’s pleading on the basis of its standing or lack thereof. (See generally Docket, No. 15 Civ. 2144 (LGS) (SN)).

[17] The NCUAB has represented that the relevant NGN agreements are substantively similar, and attached representative examples as exhibits to its pleading. The Court can therefore consider them. See Goel, 820 F.3d at 559.

[18] The Court looks to Delaware law here because Delaware law governed the NGN Trusts’ formation. See In re Goldman Sachs Mut. Funds, No. 04 Civ. 2567 (NRB), 2006 WL 126772, at *5 n.11 (S.D.N.Y. Jan. 17, 2006) (“Because the Funds are series of the Trusts, which were formed under Delaware law, that state’s law governs the issue of whether a claim should be brought derivatively.” (citing Kamen v. Kemper Fin. Servs., Inc., 500 U.S. 90, 98 (1991))). Moreover, Section 10.13 of the Trust Agreement specifies that it “shall be governed by and construed in accordance with the laws of the state of Delaware.” (NCUAB Compl., Ex. C). See Debussy LLC v. Deutsche Bank AG, No. 05 Civ. 5550 (SHS), 2006 WL 800956, at *2 (S.D.N.Y. Mar. 29, 2006) (“Not only was the Trust established under Delaware law . . . but also the Trust Agreement explicitly sets forth that the Agreement `shall in all respects be governed by, and construed in accordance with, the laws of the state of Delaware, including all matters of construction, validity and performance.'” (citations omitted)), aff’d, 242 F. App’x 735 (2d Cir. 2007) (summary order).

[19] On reply, Defendant changes tack, recasting its original argument as one that the NCUAB lacked “a cognizable injury when it commenced this litigation.” (Def. Reply 14). Because this argument is raised for the first time on reply, this Court need not consider it. Cf. Cruz v. Zucker, 116 F. Supp. 3d 334, 349 n.10 (S.D.N.Y. 2015) (finding arguments not raised in an opening brief waived), reconsideration denied, 195 F. Supp. 3d 554 (S.D.N.Y. 2016), on reconsideration, No. 14 Civ. 4456 (JSR), 2016 WL 6882992 (S.D.N.Y. Nov. 14, 2016). But even if the Court were to construe Defendant’s original arguments as arguments against the NCUAB’s Article III standing, it is skeptical that they could succeed. To the extent Defendant disputes standing on the basis of a lack of “injury,” the NCUAB “had Article III standing at the outset, even before it held the certificates directly, based on its NGN Owner Trust Certificates the value of which were diminished by [Defendant’s] PSA breaches.” (Pl. Opp. 34).

[20] New York Civil Practice Law and Rules Section 202 provides:

An action based upon a cause of action accruing without the state cannot be commenced after the expiration of the time limited by the laws of either the state or the place without the state where the cause of action accrued, except that where the cause of action accrued in favor of a resident of the state the time limited by the laws of the state shall apply.”

[21] Commerzbank has not addressed whether the laws of Ireland or the Cayman Islands might apply in the event that its claims accrued prior to their assignments.

[22] The Court notes also that Judge Daniels issued a Memorandum Decision and Order only days prior to the issuance of this Opinion, on March 21, 2017, in which he reached the same conclusion as did Judge Koeltl regarding the applicability of the German statute of limitations to RMBS claims brought by Commerzbank AG. See Commerzbank v. Bank of N.Y. Mellon, No. 15 Civ. 10029 (GBD), 2017 WL 1157278 (S.D.N.Y. Mar. 21, 2017).

[23] Rule 44.1 of the Federal Rules of Civil Procedure permits the Court to consider, “in determining foreign law . . . any relevant material or source, including testimony, whether or not submitted by a party or admissible under the Federal Rules of Evidence.” Fed. R. Civ. P. 44.1. The Rule further provides that “the court’s determination must be treated as a ruling on a question of law.” Id. “Accordingly, foreign law should be argued and briefed like domestic law. As with domestic law, judges may rely on both their own research and the evidence submitted by the parties to determine foreign law.” Commerzbank AG v. Deutsche Bank Nat’l Tr. Co., No. 15 Civ. 10031 (JGK), 2017 WL 564089, at *7 (S.D.N.Y. Feb. 10, 2017) (citation omitted) (quoting Sealord Marine Co. v. Am. Bureau of Shipping, 220 F. Supp. 2d 260, 271 (S.D.N.Y. 2002)). Here, the Court finds that the parties’ proffered expert opinions largely overlap in their recitation of the law, but reach different conclusions regarding the application of that law to the parties’ timeliness dispute. (Compare Sidman Decl., Ex. 20, with Kane Decl., Ex. 3).

[24] In its reply brief, Defendant for the first time posits a timeliness challenge to Commerzbank’s claims based on New York’s six-year statute of limitations for breachof-contract claims. (Def. Reply 14). Ironically, this timeliness argument fails by reason of its untimeliness. Cf. Cruz, 116 F. Supp. 3d at 349 n.10. But even if it had been raised in Defendant’s opening brief, this contention would fail for the same reason as do Defendant’s arguments with regard to German law. The Court cannot determine from the face of the NCUAB Complaint the date on which Defendant knew of the loanspecific breaches it must prove. Admittedly, Plaintiffs’ admission that “by January 1, 2009, [Defendant] [had] discovered that all of the Trusts’ loan pools contained high percentages of mortgage loans that materially breached the Sellers’ R&Ws” does Plaintiffs no favors. (Pl. Opp. 14 (citing BR Compl. ¶ 97; NCUA Compl. ¶ 104; PL Compl. ¶ 97; CB Compl. ¶ 71)). But discovery of these high breach percentages is not precisely the same as discovery of the relevant breaches themselves. Indeed, Defendant’s duties with regard to R&Ws breached by the sellers could not possibly be violated until some period of time following those breaches, because they arise from Defendant’s failure to disclose and cure those breaches.

 

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COUNTY OF WYOMING v. US BANK | Case REMANDED, County Recorders SURVIVE a battle in W. VA and make a number of interesting claims you’d WANT to hear

COUNTY OF WYOMING v. US BANK | Case REMANDED, County Recorders SURVIVE a battle in W. VA and make a number of interesting claims you’d WANT to hear

Claim loans in securitized trusts are UNSECURED debt because the purported assignments to the Trusts were never recorded.

 

COUNTY OF WYOMING, WEST VIRGINIA, Plaintiff,
v.
U.S. BANK NATIONAL ASSOCIATION, N.A., et al., Defendants.

Civil Action No. 5:12-cv-01465.
United States District Court, S.D. West Virginia, Beckley Division.
February 19, 2013.

MEMORANDUM OPINION AND REMAND ORDER

IRENE C. BERGER, District Judge.

The Court has reviewed Plaintiff’s Motion to Remand (“Pl.’s Mot.”) (Document 6). After careful consideration of the complaint and the written submissions of the parties, the Court finds that this action should be remanded to the Wyoming County Circuit Court.

I. FACTUAL BACKGROUND & PROCEDURAL HISTORY

On March 27, 2012, Plaintiff, County of Wyoming, West Virginia, on behalf of itself and other similarly situated West Virginia Counties, filed this action in the Circuit Court of Wyoming County, West Virginia, against Defendants U.S. Bank N.A. (“U.S. Bank”), Bank of New York Mellon (“BONY”), Bank of America, N.A. (“BofA”), Deutsche Bank (“Deutsche”) and J.P. Morgan Chase & Co. (“JPM”) and John Does 1-20. (Notice of Removal, Ex. A, Complaint (“Compl.”) (Document 1-1) at 2).[1] All identified Defendants are corporations or national banking associations with their principal places of business or main offices located outside of West Virginia. (Compl. ¶¶ 6-10.) The County of Wyoming alleges that Defendants have participated in a scheme to deprive it, and other similarly situated Counties in West Virginia, from recordation fees that would be derived from mortgage assignments. Plaintiff avers that W. Va. Code § 59-1-10(a)(1) sets forth the fee for recording assignments in West Virginia and that the current fee is $15 for the conveyance of real property. (Compl. § 20.)

Defendants are trustees for a number of residential mortgage backed security trusts or RMBS trusts which “purportedly” hold deeds of trust or mortgage loans that have been securitized and included in the Mortgage Electronic Registration Systems, Inc. (“MERS”) computer database.[2] According to Plaintiff, “[s]ecuritization is a financing method in which securities are issued against a dedicated cash flow stream of mortgage payments.” (Compl. § 21.) This process is initiated by a financial institution lending money to a mortgage borrower (or originating a loan). Once the loan is complete, the financial institution, known as a sponsor, bundles together a group of mortgage loans that it originated (or purchased) and sells them to a “special-purpose subsidiary” or depositor and this depositor then sells the bundled loans to a RMBS trust. (Compl. § 23.) These trusts are created and governed by a “Pooling and Servicing Agreement (“PSA”) to ensure that all rights to the mortgage loans are transferred to the trustee from the depositor so that in the event of a default no other entity in the chain of title can claim control of the collateral securing the mortgage loan.[3] Plaintiff alleges that the PSA is usually boilerplate and generally includes that the conveyance to the Trustee is as to “all the right[s], title and interest of the Depositor in and to the assets of the Trust Fund.” (Compl. § 28.) (quoting a PSA for non-defendant Merrill Lynch First Franklin Mortgage Loan Trust, Mortgage Loan Asset-Backed Certificates, Series 2007-2, at Section 2.01.) The PSA also includes provisions relative to the requirements for first priority security interests, the documents supporting each mortgage loan, and how the trustee will acknowledge its acceptance of assignment of these loans. Plaintiff alleges that despite the conveyance of the mortgage loans to the RMBS trust, the individual mortgages “remain listed in county recorders of deeds offices in the name of the originating lenders of the mortgage loans and have not been assigned to the trusts.” (Compl. § 30.) Plaintiff further alleges that Defendants “would have needed to record, or cause to be recorded, all [Deeds of Trust] assignments from originating lenders to the depositors to the trusts, and to pay the accompanying recording fees” in order to “transfer[] all rights to the mortgage free and clear of any encumbrance, . . . to have priority and lawfully enjoy the benefits of proper securitization[.]” (Id.) Plaintiff alleges that Defendants have failed to “record [Deeds of Trust] assignments and pay the accompanying fees to Plaintiff [and other similarly situated West Virginia counties] for all notes in the trusts attached to all [Deeds of Trust] filed with the Wyoming County Clerk [and in the county recording offices of similarly situated West Virginia counties.]” (Compl. §§ 33-34.) As a result, Plaintiff alleges that the originating lender maintains the legal title to the Deed of Trust, priority and right to foreclose. (Compl. § 31.)

Plaintiff also alleges that Defendants utilized MERS to “circumvent county recording fees.” (Compl. § 41.) In support of this allegation, Plaintiff explains that when a loan is originated, the lender takes possession of the note to become the noteholder, but the lender and the borrower designate MERS as the lender’s Nominee and the Beneficiary under the deed of trust. This deed of trust is allegedly recorded and the secured interest of the lender (and its successors and assigns) is now held in MERS. Plaintiff further explains that if a debtor defaults on the loan, MERS, as the deed of trust beneficiary, will authorize the foreclosure of the home and the loan information from the deed of trust will be registered by the MERS member financial institution on the MERS system. Plaintiff alleges that when this loan is sold through the securitization process, “the note is transferred from the original lender by an endorsement and delivery and MERS members are allegedly required to update the MERS system to reflect the change in ownership. . . . [S]o long as the note has been transferred to a MERS member, the transaction allegedly does not need to be recorded because under the terms of the mortgage, MERS remains the original Mortgagee/Beneficiary, as the Nominee for the new beneficial owner of the note (the original lender’s successor and/or assign.)” (Compl. § 41.) Plaintiff also alleges that because the deeds of trust list MERS as a Nominee, any directions concerning the legal title of the mortgage must come from the originating lender and not the trusts which possess the mortgage note. This allegedly “depriv[es] the trust of the critical right to enforce the note through foreclosure proceedings.” (Compl. at 48.) Plaintiff avers that given the limited agency of MERS as to the originating lender, the original lender must grant MERS the authority to assign the Deeds of Trust, according to the noteholder’s instruction. According to Plaintiff, since this transaction would involve the assignment of real estate interests, this agency relationship must be committed to writing to satisfy West Virginia’s Statute of Fraud, [but] [n]o such writings exist.” (Compl. § 50.)

As a result of the foregoing situations, Plaintiff alleges that the RMBS trusts “lack[] the power to foreclose for all notes it holds in which the associated [Deeds of Trust] list an originating lender and MERS as nominee because the notes and [Deeds of Trust] have been severed . . . render[ing] the note [an] unsecured debt.” (Compl. § 54.) However, Plaintiff “believes the Defendants . . . relied on the real property recording systems of the Counties to execute foreclosures on non-performing mortgages without fully compensating the Counties for that benefit.” (Id.) Plaintiff alleges that foreclosures initiated by Defendant Trustees, “either in MERS’ name when MERS lacked standing to initiate foreclosures, or where MERS lacked the authority to assign [Deeds of Trust] to the trust for the trust to initiate the foreclosures” have caused it and other counties to “suffer[] drastic consequences because such foreclosures from “fraudulent assignments from MERS” means that the property may lack clear title which impacts the value of the property, its salability, and neighboring property values. (Compl. § 60.)

As a result, in the governing pleading, Plaintiff requests that the Court certify this civil action as a class action of

“all West Virginia counties with [Deeds of Trust] filed in their County Clerk or Recorder of Deeds Office that are allegedly attached to notes deposited in RMBS trusts administered by the Defendants as Trustees, and that lack recorded [Deeds of Trust] assignments from the originating lender to the depositor to the trust at the time of the trusts creation.”

(Compl. § 61.) Additionally, Plaintiff asserts three causes of action against Defendants: (1) unjust enrichment; (2) declaratory judgment that the notes held in the RMBS trusts are unsecured debt, and (3) declaratory judgment that “MERS and Defendant administered trusts receiving assignments from MERS, did not have legal right to initiate foreclosures for notes in RMBS trusts administered by Defendants as Trustees[]” and a mandatory injunction “requiring that the Defendants record all prior assignments from the originating lender to the depositor to the trust, and pay the associated recording fees, in order to clear title to properties in the Counties.” (Compl. §§ 65-91.) In the various prayers for relief, Plaintiff seeks compensatory damages, restitution and disgorgement of all monies due and owing to Plaintiff and the purported class, the requested declarations and injunction, pre-judgment interest, attorneys’ costs and fees and exemplary damages. (Compl. at 28.)

On May 9, 2012, Defendant U.S. Bank removed this action to this Court pursuant to 28 U.S.C. §§ 1441 and 1446 by invoking this Court’s diversity jurisdiction. (Notice of Removal (“Notice”) (Document 1) at 3.) In several emails attached to the Notice, the balance of the named Defendants consented to the removal of this action. (Notice of Removal, Ex. D, (Document 1-4) at 1-4.) U.S. Bank asserts that Plaintiff is a citizen of the State of West Virginia and that the amount in controversy can be satisfied by several independent grounds. In its Notice of Removal, U.S. Bank asserts that the requisite jurisdictional amount can be met due to Plaintiff’s request for: (1) a declaration that any note deposited into the RMBS trust be declared an unsecured debt; (2) exemplary damages; (3) attorney’s fees, and (4) actual damages of recording fees that should have been paid for certain mortgage assignments. (Notice at 7-8). The record reveals that U.S. Bank removed this action within thirty days of receipt of service of a copy of the government pleading as required by 28 U.S.C. § 1446(b). (Notice at 3.)

Plaintiffs timely filed their motion to remand on June 30, 2012, pursuant to 28 U.S.C. § 1447(c) to assert that diversity jurisdiction is lacking because (1) it is not a citizen of the State of West Virginia and (2) the amount in controversy has not been established to satisfy the requisite jurisdictional amount. (Pl.’s Mot. at 1.) The motion has been briefed and is ripe for consideration.

II. APPLICABLE LAW

An action may be removed from state court to federal court if it is one over which the district court would have had original jurisdiction. 28 U.S.C. § 1441(a).[4] This Court has original jurisdiction over all civil actions between citizens of different states where the matter in controversy exceeds the sum or value of $75,000. 28 U.S.C. § 1332(a)(1). Generally, every defendant must be a citizen of a state different from every plaintiff for complete jurisdiction to exist. Section 1446 provides the procedure by which a defendant may remove a case to a district court under Section 1441.[5]Section 1446 requires that, “[a] defendant or defendants desiring to remove any civil action from a State court shall file . . . a notice of removal signed pursuant to Rule 11 of the Federal Rules of Civil Procedure and containing a short and plain statement of the grounds for removal[.]” 28 U.S.C. § 1446(a). Additionally, a defendant is required to file a notice of removal within thirty days after receipt by the defendant, through service or otherwise, a copy of the initial pleading. 28 U.S.C. § 1446(b)(1). Moreover, in the newly amended statute, Congress has required that “[w]hen a civil action is removed solely under section 1441(a), all defendants who have been properly joined and served must join in or consent to the removal of the action.” 28 U.S.C. § 1446(b)(2)(A).

It is the long-settled principle that the party seeking to adjudicate a matter in federal court, through removal, carries the burden of alleging in its notice of removal and, if challenged, demonstrating the court’s jurisdiction over the matter. Strawn et al. v. AT &T Mobility, LLC et al., 530 F.3d 293, 296 (4th Cir. 2008)Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148, 151 (4th Cir. 1994) (“The burden of establishing federal jurisdiction is placed upon the party seeking removal.”) (citation omitted). Accordingly, in this case, the Removing Defendants have the burden to show the existence of diversity jurisdiction by a preponderance of the evidence. See White v. Chase Bank USA, NA., Civil Action No. 2:08-1370, 2009 WL 2762060, at *1 (S.D. W. Va. Aug. 26, 2009) (Faber, J) (citing McCoy v. Erie Insurance Co., 147 F.Supp. 2d 481,488 (S.D. W. Va. 2001)). In deciding whether to remand, because removal by its nature infringes upon state sovereignty, this Court must “resolve all doubts about the propriety of removal in favor of retained state jurisdiction.” Hartley v. CSX Transp., Inc., 187 F.3d 422, 425 (4th Cir. 1999).

III. DISCUSSION

Plaintiff does not question the timeliness of U.S. Bank’s removal or the character of the consents provided by the balance of the removing defendants. However, Plaintiff challenges the invocation of this Court’s diversity jurisdiction by contending that it, as a county, is not a citizen of the state of West Virginia and that U.S. Bank has not demonstrated the requisite jurisdictional amount. The Court will first consider Plaintiff’s challenge of Defendant’s attempt to satisfy the amount in controversy.

Section 1446 provides guidance with respect to a district court’s consideration of the requisite amount in controversy for removals based on diversity jurisdiction. Specifically, Section 1446 instructs that

[i]f removal of a civil action is sought on the basis of the jurisdiction conferred by section 1332(a), the sum demanded in good faith in the initial pleading shall be deemed to be the amount in controversy, except that—

(A) the notice of removal may assert the amount in controversy if the initial pleading seeks—

(i) nonmonetary relief; or

(ii) a money judgment, but the State practice either does not permit demand for a specific sum or permits recovery of damages in excess of the amount demanded; and

(B) removal of the action is proper on the basis of an amount in controversy asserted under subparagraph (A) if the district court finds, by the preponderance of the evidence, that the amount in controversy exceeds the amount specified in section 1332(a).

28 U.S.C. § 1446(c)(2). As Section 1446 instructs, generally the “sum claimed by the plaintiff controls” the amount in controversy determination. JTH Tax, Inc. v. Frashier,624 F.3d 635, 638 (4th Cir. 2010) (citing St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288 (1938)). However, when the sum certain demand is not specified in the complaint, like in this case, the determination of the amount in controversy “becomes more difficult.” Bartnikowski v. NVR, Inc., 307 F.App’x. 730, 734 (4th Cir. 2009) (unpublished decision). In such a case, the defendant, as the party invoking this Court’s jurisdiction, is tasked with presenting evidence that the amount in controversy exceeds $75,000. The demonstration of the requisite jurisdictional allegation must be by a preponderance of the evidence. Therefore, a defendant may not rely upon conjecture or speculation. Dent v. Chesapeake Appalachia, LLC, No.5:12CV53, 2013 WL 461225, *7 (N.D. W. Va. Feb. 5, 2013) (citing Bartnikowski, 307 F.App’x. at 737). “To satisfy [its] burden, a defendant must offer more than a bare allegation that the amount in controversy exceeds $75,000. Instead, a defendant seeking removal must `supply evidence to support [its] claim regarding the amount at issue in the case.'” Heller v. TriEnergy, Inc., No. 2012 WL 2740870, *9 (N.D. W.Va. July 9, 2012) (quoting Sayre v. Potts, 32 F.Supp.2d 881, 886 (S.D. W.Va.1999)) (internal citation omitted). To ascertain the amount in controversy, a court may consider the cause of action alleged in the complaint, the notice of removal and other relevant materials or evidence that was available at the time of removal. Dent, 2013 WL 461225 at *2.

According to U.S. Bank, inasmuch as Plaintiff seeks a declaration in Count Two that the notes held within their trusts are unsecured debt, Plaintiff desires a determination that will separate a lender’s mortgage and security interest from the promissory note. (Notice at 5.) Defendant argues that such a declaration will require the conversion of all of its mortgage notes held in RMBS trusts administered by MERS to be unsecured debt, which necessarily implicates the value of the mortgages on the residential properties. (Notice at 5-6.) In this vein, U.S. Bank and BofA have identified at least two such mortgages with unpaid principal balances that total $293,172.31. (Id. at 6-7) (Defendant offers two affidavits in support of this contention: (1) affidavit of Irina Palchuk, Vice President of Global Corporate Trust Services Group, wherein she attests that U.S. Bank holds within its trust a residential mortgage for a property in Wyoming County with an “unpaid balance” of $89,646.71 (Notice of Removal Ex. B (Document 1-2)); and (2) affidavit of Robin Chrostowski, Vice President of Bank of America, N.A., swearing that BofA services a mortgage loan in a RMBS trust for a property located in Wyoming County that has an unpaid balance of $230,525.60 (Notice of Removal Ex. C (Document 1-3))). U.S. Bank asserts that the value of these loans alone satisfy the jurisdictional amount. Next, U.S. Bank contends that the jurisdictional amount is met by Plaintiff’s request for exemplary damages. (Id. at 7.) Using the ratio of 2.55 to 1 as applied in Patton v. Fifth Third Bank, U.S. Bank asserts that the amount in controversy as to the exemplary damages of the two identified loans is $747,589.39. (Id.) (citing Patton v. Fifth Third Bank, No.Civ.A. 2:05-0790, 2006 WL 771924, at *2-3 (S.D. W. Va. Mar. 24, 2006)). U.S. Bank also asserts that the amount in controversy is independently met by Plaintiff’s request for attorney’s fees which can be awarded in an amount which is one-third of a party’s recovery. (Id. at 7). Given the values of the two identified loans and the award of exemplary damages, U.S. Bank argues that this fee places into controversy an amount over $300,000. (Id. at 8.) Finally, U.S. Bank asks the Court to consider Plaintiff’s request to recover actual damages of the recording fees it believes it should have been paid for certain assignment mortgages. Defendants argue that these amounts “will increase the amount in controversy.” (Id.) In support of this contention, Defendant does not offer any evidence of the number of loans held within its trusts or the number of assignments that were made, according to Plaintiff’s theory, which did not result in the payment of recordation fees.

The Court has considered the asserted claims by Plaintiff, including its request for declaratory relief, and finds that Defendant has failed to satisfy its burden of demonstrating that the requisite jurisdictional amount can be met in this case. “[L]ike requests for money damages, requests for injunctive [or declaratory] relief must be valued in determining whether the plaintiff has alleged a sufficient amount in controversy.” JTH Tax, 624 F.3d at 639 (citing Hunt v. Wash. State Apple Adver. Comm’n, 432 U.S. 333, 347 (1977) (“In actions seeking declaratory or injunctive relief, it is well established that the amount in controversy is measured by the value of the object of the litigation.”)). “In this circuit, it is settled that the test for determining the amount in controversy in a diversity proceeding is `the pecuniary result to either party which [a] judgment would produce.'” Dixon v. Edwards, 290 F.3d 699, 710-711 (4th Cir. 2002) (quoting Gov’t Employees Ins. Co. v. Lally, 327 F.2d 568, 569 (4th Cir.1964)). With this law as context, the Court is not persuaded that the value of the object of this litigation invokes a consideration of the face value of an individual mortgage loan.

In this case, the County Plaintiff is aggrieved that it has been duped out of receiving recordation fees for the transfer of an ownership interest in real estate throughout the securitization process. As a result of what it believes it is due and owing by law, Plaintiff seeks to obtain its statutory fee for every ownership re-assignment that could have been recorded in its county records based on the conveyances involved in the loan securitization process. Plaintiff represents, without dispute, that the fee for such recordation is $15 for each transfer. Consequently, it is immaterial that the mortgage loan is valued at $1.00 or $1,000,000; the recordation fee would be the same for each transaction. In its request for a declaration that the mechanism by which U.S. Bank and others have established its lending practice and utilized MERS, Plaintiff asserts that the Defendants have established an unsecured debt situation as opposed to a first priority security interest in each of the loans. Should an award be given in favor of Plaintiff and against Defendant with respect to Count Two—that is, a declaration that what Defendant believed to be a secured debt would be an unsecured debt—the validity or extent of the loan would not be implicated. Instead, the issue would become how a deed of trust beneficiary would collect or enforce its right on a non-performing loan. Based on the allegations of the Complaint, if a court were to declare the debt as unsecured, a defendant would risk losing the value, not of the individual mortgage loan, but of the securitized product which it believed contained first priority deeds of trust. (See Compl. ¶¶ 27, 31). Therefore, the object of the litigation, from the Defendants’ perspective, would be the difference between the value of a secured debt verses that of an unsecured debt. “To place a value on the equitable relief requested based on . . . mortgage loans as secured debt versus their value as unsecured debt might well prove incapable of accurate guesstimation, but if it could be done, it would certainly require expert evaluation, analysis and opinion.”See County of Washington, Pennsylvania v. U.S. Bank N.A., No.11-1405, 2012 WL 3860474, *27 (W.D. Pa. (Aug. 17, 2012) (civil action with complaint substantially similar to that in this case where court granted motion to remand finding that the defendant failed to demonstrate the amount in controversy). U.S. Bank has not offered evidence of this nature.

Moreover, to view the object of the litigation from the perspective of the Plaintiff, that is to obtain the recordation fees for each real estate ownership interest transfer, the Court would need to know the number of the mortgage loans held within U.S. Bank’s RMBS trust for properties in Wyoming County which name MERS as nominee, as well as, the number of assignments that occurred throughout the securitization process between the originating loan and acquisition of the loan in the U.S. Bank’s RMBS trust. (County of Washington, 2012 WL 3860474 at *23). U.S. Bank has not offered any evidence of these factors and the same is not contained on the face of the complaint, notice of removal or the record of this case.

Given that U.S. Bank’s argument establishing this Court’s jurisdiction based on the value of two identified residential mortgage loans has been rejected, the balance of its arguments fail. Further, the Court is not in the position to consider the appropriate measurement of punitive damages or attorney’s fees, even if, given the allegations in the record, such fees could be properly asserted and considered to determine the amount in controversy in this case. Therefore, the Court finds that Defendant has failed to prove by a preponderance of the evidence that the requisite jurisdictional amount can be satisfied in this case. To the extent that Defendant has failed to demonstrate a critical component of diversity jurisdiction, the Court finds that it need not address the parties’ arguments relative to the citizenship of Plaintiff Wyoming County.

Finally, Plaintiff moves for an “order requiring the Defendant to pay costs, expenses, and attorney fees incurred by Wyoming County as a result of the removal.” (Memorandum of Law in Support of Wyoming County’s Motion to Remand (Document 7) at 18.) Pursuant to 28 U.S.C. § 1447(c), A[a]n order remanding the case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of the removal.” The United States Supreme Court in Martin v. Franklin Capitol Corp., 546 U.S. 132 (2005), has instructed that:

[T]he standard for awarding fees should turn on the reasonableness of the removal. Absent unusual circumstances, courts may award attorney’s fees under [Section] 1447(c) only where the removing party lacked an objectively reasonable basis for seeking removal. Conversely, when an objectively reasonable basis exists, fees should be denied.

(Martin, 546 U.S. at 141) (citations omitted). An award of fees and costs upon a court’s determination that a remand is warranted is not automatic. The Supreme Court in Martin foreclosed any such automatic fee-shifting argument when it considered the language used in Section 1447(c). See Martin 546 U.S. at 136-37. The Supreme Court explained that Section 1447(c) provides “that a remand order `may’ require payment of attorney’s feesBnot `shall’ or `should.'” (Id. at 136.) This language clearly indicates that a district court has discretion in awarding attorney fees on remand. The Court further explained that “[t]he automatic awarding of attorney’s fees to the prevailing party would pretermit the exercise of that discretion[]” and that there is “no sound basis” for a presumption in favor of awarding fees. (Id.) The Supreme Court has instructed that “the standard for awarding fees should turn on the reasonableness of the removal.” (Id.) The Court provided an example for the discretion a court should use in determining its departure from the rule,

[f]or instance, a plaintiff’s delay in seeking remand or failure to disclose facts necessary to determine jurisdiction may affect the decision to award attorney fees. When a court exercises its discretion in this manner, however, its reasons for departing from the general rule should be “faithful to the purposes” of awarding fees under [Section] 1447(c).

(Id. at 141.) Furthermore, “[t]he ultimate decision as to whether or not fees and costs should be awarded is left to the sound discretion of the district court, and it is not necessary for the Court to find “bad faith” on the part of the removing party before making such awards.” Allen v. Monsanto Company, 396 F.Supp.2d 728, 733 (S.D. W. Va. 2005) (Chambers, J.) (citing Watson v. Charleston Hous. Auth., 83 F.Supp.2d 709, 712 (S. D. W. Va. 2000) (Haden, J.) “The purpose, instead, is to reimburse a party for the costs associated with responding to an improper removal.” (Id.) (citations omitted.) After careful consideration of the parties’ written submissions and the basis for U.S. Bank’s removal, the Court cannot find that Defendant acted in an objectively unreasonable manner. Indeed, Plaintiff failed to proffer any such argument in its Motion (See Memorandum of Law in Support of Wyoming County’s Motion to Remand (Document 7) at 18-19.) Therefore, the Court denies Plaintiff’s request for attorney fees and costs.

IV. CONCLUSION

For the reasons stated above, the Court does hereby ORDER that Plaintiff’s Motion to Remand (Document 6) be GRANTED, that this action be remanded to the Circuit Court of Wyoming County, and that Plaintiff’s request for attorney’s fees and costs be DENIED.

Further, the Court DIRECTS the Clerk to send copies of this Memorandum Opinion and Remand Order to all counsel of record, any unrepresented party, and a certified copy to the Clerk of the Circuit Court of Wyoming County.

[1] The Court observes that Plaintiff includes in the opening lines of its pleading that Plaintiff initiates this action against “cLaSalle.” (Compl. at 2.) No further description of this entity, person or business organization is included in the pleading. The Court further observes that Plaintiff has not listed “LaSalle” as a party defendant in the section of its pleading which specifically denotes the parties to this action. Consequently, the Court has not considered LaSalle as a party relevant to the pending motions.

[2] Plaintiff alleges that MERS, a non-party to this civil action: (1) is a subsidiary of MERSCORP, which is incorporated in Delaware and has its principal place of business in Virginia; (2) was created in the mid-1990s “to allow financial institutions, including the Defendants to evade county recording fees and avoid the need to publicly record mortgage transfers” (Compl. § 36); (3) maintains a computer database that is designed to track the ownership rights and servicing of mortgage loans in the United States; has no employees, but over 5,000 member institutions and 20,000 certifying officers; and (4) houses the registration of over 31 million active loans in its system. (Compl. §§ 36-40.) Plaintiff also alleges that “MERS’ avoidance of filing mortgage / [Deeds of Trust] assignments has resulted “in the loss of millions of dollars to county governments and taxpayers from the collection of recordation fees, which fees are allocated to maintain the county recorders’ records as well as fund other county services[.]” (Compl. § 37.) Plaintiff alleges that MERS has been poorly maintained and fails to ensure that its “members update its system when note transfers occur[.]” (Compl. § 42.)

[3] If the RMBS trust qualifies under the applicable tax law as a real estate mortgage investment conduit (“REMIC”) it will be treated as a “pass-through” entity for federal tax purposes, whereby the investment vehicle’s investors are only taxed once for any distributions made by the trust. (Compl. §§ 21-29).

[4] Section 1441 states in pertinent part:

Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending.

28 U.S.C. § 1441(a).

[5] The Federal Courts Jurisdiction and Venue Clarification Act of 2011, Pub.L. No. 112-63, § 1, 125 Stat. 758 (2011) (the “2011 Act”) amended several provisions of Title 28, including Section 1446.

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House of Cards – Still No Change Today in 2012

House of Cards – Still No Change Today in 2012

This video is from 2009 and here we are today half way through 2012 and not one single thing has changed but Main Street continues get the short end of the stick. The banks sold you a dream and the president candidates sold you the lie.

Obama/Romney 2012 will continue to ignore Main Street.

 

Thu 04 Jun 09

CNBC presents the defining story of our time. Correspondent David Faber investigates the origins of the global economic crisis and the events leading to the most devastating financial collapse since the Great Depression.
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A valentine from Chief United States, Bankruptcy Court Middle Dist. of Florida Judge Karen S. Jennemann on Feburary 14, 2012

A valentine from Chief United States, Bankruptcy Court Middle Dist. of Florida Judge Karen S. Jennemann on Feburary 14, 2012

A valentine from Chief United States Bankruptcy Judge Karen S. Jennemann on Feburary 14, 2012:

The Court cannot avoid suspecting that the second allonge indeed was created solely to rebut the trustee‘s assertions in this litigation and did not previously exist. If so, the Court suggests Deutsche and Ms. Faber individually consider the possible consequences of propounding potentially false evidence and perjured testimony to the Court. Muselman v. Deutsche Bank, U.S. Bankruptcy Court, Middle District of Florida, Orlando Division, Case No. 6:10-bk-07828-KSJ. Document 67, page 8.

As gratifying as this recognition of fraudulent documents may be, it does raise the question: just what are the consequences of propounding false evidence and perjured testimony to the Court. With the exception of a few judges and a few decisions, there have been no consequences whatsoever.

FRAUD DIGEST by Lynn E. Szymoniak, ESQ.

 

NOTE:

I would like to make a note of this because as soon as I posted this IN RE BALDERRAMA | FL BK Court “Deutsche Bank, Not proven to either the trustee or the Court that it holds a validly endorsed promissory note evidencing its purchase of the debt on the disputed property”, it went completely missing from the site! See for yourself and it’s still missing and not sure why some cases go missing.

 

451 B.R. 185 (2011)

In re Maria Renee BALDERRAMA, Debtor.
Carla P. Musselman, as Chapter 7 Trustee, Plaintiff,

v.

Deutsche Bank Trust Company Americas, in trust for Residential Accredit Loans, Inc. Mortgage Asset-Backed Pass-Through Certificates, Series 2007-QH5, Defendant.

Bankruptcy No. 6:10-bk-07828-KSJ. Adversary No. 6:10-ap-00245-KSJ.
United States Bankruptcy Court, M.D. Florida, Orlando Division.
May 4, 2011.
186*186 Seldon J. Childers, Childers Law LLC, Gainesville, FL, for Plaintiff.

Daniel A. Miller, Broad and Cassel, West Palm Beach, FL, for Defendant.

MEMORANDUM OPINION PARTIALLY GRANTING AND PARTIALLY DENYING TRUSTEE’S AMENDED AND RENEWED MOTION TO COMPEL PRODUCTION OF DEUTSCHE BANK

KAREN S. JENNEMANN, Bankruptcy Judge.

In this adversary proceeding the Chapter 7 trustee, Carla Musselman, seeks to quiet title and to value at zero dollars defendant Deutsche Bank’s alleged secured interest in debtor Maria Balderrama’s non-homestead real property. As part of discovery, the trustee served interrogatories and document production requests seeking information about the bank’s purchase of the promissory note and mortgage on the disputed property.[1] Deutsche Bank resists producing any discovery related to the purchase history of the note and the chain of title of the mortgage arguing that, under Florida law, it has established its secured interest in the property merely by alleging it holds the original promissory note endorsed specially in its favor.[2] The trustee disputes Deutsche Bank’s characterization of Florida law and notes that neither the Court nor the trustee has seen the original endorsed note. She now requests the Court 187*187 compel the bank to produce the requested information.[3]

Although Deutsche Bank is correct that under Florida law if it holds a validly endorsed original note it may be deemed equitably also to own the mortgage, the bank first must establish its actual possession of the original note. As such, the trustee’s discovery requests pertaining to Deutsche Bank’s status as holder of the note, including the authenticity and authority of the signatures endorsing the note, are relevant. All other requests, including any requests for information regarding the prior ownership history of the note or the mortgage, are irrelevant and overbroad under Florida law. Accordingly, the Court will grant in part and deny in part the trustee’s motion and direct Deutsche Bank to respond to interrogatory number 5 and document request numbers 7 and 30 on or before June 3, 2011. The trustee’s motion to compel otherwise is denied, and the objections raised by the bank are sustained as to all other interrogatories and production requests.

On September 28, 2010, the trustee initiated this adversary proceeding to value Aurora Loan Services’ secured claim at $0.00 pursuant to § 506(a) of the Bankruptcy Code[4] and to quiet title in property owned by the debtor located in Rockledge, Florida. Aurora is the servicing agent on the mortgage, and it previously has moved for relief from stay to foreclose on the mortgage,[5] which this Court denied without prejudice for lack of evidentiary support.[6] On October 18, 2010, the trustee served her first set of interrogatories and first requests for production of documents on Aurora. On November 17, 2010, Aurora filed its objections to the trustee’s discovery requests,[7] objecting to certain requests seeking information about the history of the ownership of the subject note and mortgage. Aurora’s objections are based on its position that under Florida law the holder of a promissory note may equitably own and enforce a mortgage, even without a written assignment of the mortgage, and, accordingly, that the trustee’s requests seeking information regarding chain of ownership are irrelevant and overbroad.

On December 16, 2010, at a pretrial conference before this Court, the parties discussed Aurora’s objections to the trustee’s discovery, and the trustee made an ore tenus motion to amend the complaint to name Deutsche Bank as the real defendant in interest as the alleged holder of the original promissory note, which the Court granted.[8] At the hearing, the trustee also agreed to file an amended motion to compel Deutsche Bank to respond to the discovery requests served on Aurora, and Deutsche Bank has agreed for purposes of resolving the amended motion to compel and its/Aurora’s objections to the trustee’s discovery that it will step into Aurora’s position and stipulate for convenience that the discovery served on Aurora properly was served on it.[9]

188*188 Accordingly, on January 4, 2011, the trustee amended her complaint to change the name of the defendant from Aurora to Deutsche Bank Trust Company Americas, in trust for Residential Accredit Loans, Inc. Mortgage Asset-Backed Pass-Through Certificates, Series 2007-QH5.[10] On January 18, 2011, Deutsche Bank filed its answer to the amended complaint.[11] On January 28, 2011, the trustee filed her amended motion to compel defendant’s response to trustee’s first interrogatories and request for production of documents and an associated memorandum of law.[12] On February 25, 2011, Deutsche Bank filed its memorandum in response to the trustee’s motion to compel.[13]

The trustee’s amended complaint argues Deutsche Bank cannot provide sufficient evidence of its purchase of either the note or the mortgage to assert a secured claim to the disputed property. The trustee now seeks to compel production of information from Deutsche Bank regarding its purchase of the underlying debt and mortgage, and especially whether the note and mortgage were properly assigned.

In response to the motion to compel, Deutsche Bank reiterates Aurora’s previous position, arguing certain interrogatories and production requests regarding chain of title are irrelevant and overbroad because, under Florida law, it need only show it holds the original note evidencing its purchase of the debt underlying the mortgage for it to equitably own the mortgage, too.[14] Essentially, the bank argues that, in Florida, a mortgage travels equitably with the underlying debt in the absence of a formal written assignment of the mortgage. Because the bank allegedly holds the note specially endorsed in its favor, Deutsche Bank maintains it already has established its security interest in the property.

The Court largely agrees with Deutsche Bank’s legal argument. Under applicable Florida law,[15] a mortgage, even without a written assignment, may travel equitably to the holder of the underlying debt, i.e., to the entity holding the original, properly executed and endorsed promissory note. Thus, if Deutsche Bank establishes it is the holder of a validly endorsed note, it, in turn, will establish its equitable ownership of the mortgage securing the note. This general rule of Florida law (the “General Rule”) was stated best in 1938 by the Florida Supreme Court in the seminal case Johns v. Gillian, as follows:

… a mortgage is but an incident to the debt, the payment of which it secures, and its ownership follows the assignment of the debt. If the note or other debt secured by a mortgage be transferred without any formal assignment of the mortgage, or even a delivery of it, the mortgage in equity passes as an incident to the debt, unless there be some plain and clear agreement to the contrary, if that be the intention of the parties.[16] 189*189 Johns goes on to say that “[t]he transfer of the note or obligation evidencing the debt… operates as an assignment of the mortgage securing the debt, and it is not necessary that the mortgage papers be transferred, nor, in order that the beneficial interest shall pass, that a written assignment be made.”[17] Johns concluded that “if there had been no written assignment, Gillian would be entitled to foreclose in equity upon proof of his purchase of the debt.”[18] Finding that Gillian had sufficiently proven his purchase of the debt through his in-court testimony, the court held that Gillian was the “equitable owner of the mortgage” entitled to foreclose, even though no formal assignment of the mortgage was executed.

The General Rule is alive and well in Florida.[19] In Riggs v. Aurora Loan Services, LLC,[20] Florida’s Fourth District Court of Appeals held Aurora was entitled to summary judgment in a foreclosure action when it produced the original mortgage, a promissory note endorsed in blank, and affidavits that stated Aurora was the proper holder of the note and mortgage. Aurora did not submit a written assignment of the mortgage, and Aurora was not the original mortgagee. Nonetheless, the court found Aurora was the holder of the note entitled to enforce its terms under Fla. Stat. § 673.3011, and thus could foreclose on the mortgage, because it provided sufficient evidence of its purchase of the debt underlying the mortgage: possession of the original note endorsed in blank.[21]

Likewise, in another decision, the Fourth District Court of Appeals reversed and remanded a dismissal of a foreclosure action because the lower court failed to consider application of the General Rule.[22] In that case, WM Specialty filed a foreclosure complaint on December 3, 2002, and later, in response to a motion to dismiss, filed an assignment of mortgage dated January 3, 2003. The assignment, however, reflected that the mortgage was transferred to WM Specialty prior to the complaint date on November 25, 2002. The lower court found the complaint was void ab initio because WM Specialty did not hold the note and mortgage as of the date of filing the complaint. In reversing the lower court, the appellate court instructed the lower court to consider on remand whether WM Specialty acquired an equitable interest in the mortgage before execution of the written assignment by virtue of the prior transfer of the note and mortgage to WM Specialty. The court quoted Johns favorably at length for the proposition that “the mortgage in equity passes as an incident to the debt,” and indicated the lower court had failed to consider this General Rule.

In reaching its conclusion, WM Specialty Mortgage distinguished the facts before it from Jeff-Ray Corp. v. Jacobson,[23] another Fourth District Court of Appeals case the Chapter 7 trustee relies on in attempting to establish an exception to the General Rule. Jeff-Ray held that a trial court erred in not dismissing a foreclosure complaint for failure to state a cause of 190*190 action because it relied upon an assignment that was not in existence when the complaint was filed. There, the complaint was filed on January 4, 1988, supported by an alleged assignment of mortgage dated in 1986, which was not attached to the complaint. When the plaintiff later produced the assignment, it was dated April 18, 1988, four months after the complaint was filed. The plaintiff’s actions therefore led the appellate court to conclude that plaintiff had lied to the court by stating it held an assignment of mortgage from 1986 when in fact it held no assignment at all. Moreover, the court in Jeff-Ray did not discuss the General Rule or consider whether equitable transfer of the mortgage occurred prior to filing the foreclosure complaint because the plaintiff had not alleged any facts that might have indicated such transfer occurred (e.g. purchase of the underlying debt or any indication the plaintiff held possession of the mortgage in 1986).

These recent Florida appellate court cases all support Deutsche Bank’s position that proof of ownership of the debt underlying a mortgage is sufficient under Florida law to equitably convey the mortgage to the debt holder. Moreover, these cases suggest a note specifically endorsed to a foreclosure plaintiff is sufficient proof of purchase of the debt underlying a mortgage to equitably convey such mortgage. Indeed, Riggs indicates the holder of a note endorsed in blank may hold an equitable interest in the mortgage securing the note.[24]

The trustee disputes this legal analysis and, in response, argues that an exception to the General Rule applies.[25] She interprets Johns[26] to create an exception to the General Rule that if a foreclosure plaintiff lacks a written assignment of the mortgage he must prove his purchase of the debt beyond merely establishing he is the holder of the note underlying the mortgage. The trustee relies on this sentence: “Or if there had been no written assignment, Gillian would be entitled to foreclose in equity upon proof of his purchase of the debt.” Noticeably absent from this sentence and the Johns decision, however, is any statement that a creditor’s proof of its status as holder of a promissory note is not proof of purchase of the debt. The trial court in Johns required testimony of Gillian to establish he purchased the mortgage debt because there were factual issues raised concerning the timing of the purchase of the note.[27] But nothing in Johns or the more recent Florida appellate court cases can credibly be construed as establishing an exception to the General Rule that would require a note holder to prove its purchase of the debt beyond simply establishing that it is indeed the note holder. Proof of a creditor’s status as holder of a note underlying a 191*191 mortgage is proof of purchase of the debt, and the previous ownership history of the note and mortgage is irrelevant.

The trustee’s argument also relies on a decision from the Massachusetts Supreme Court, applying Massachusetts law, to argue that Florida state courts require more than the original note to convey equitable title to a mortgage.[28] Because Massachusetts law treats the equitable assignment of mortgages very differently than Florida law, a Massachusetts court’s interpretation of the law of their state is irrelevant to this proceeding. Ibanez sums up well how Massachusetts law deals with equitable transfer of mortgages as follows:

In Massachusetts, where a note has been assigned but there is no written assignment of the mortgage underlying the note, the assignment of the note does not carry with it the assignment of the mortgage. [] Rather the holder of the mortgage holds the mortgage in trust for the purchaser of the note, who has an equitable right to obtain an assignment of the mortgage, which may be accomplished by filing an action in court and obtaining an equitable order of assignment.[29]

These procedures are quite different than Florida’s procedures and its General Rule. Unlike Massachusetts, Florida law does allow the assignment of a note to carry with it the implicit assignment of the mortgage. Indeed, Ibanez distinguishes Massachusetts law from such other states’ laws that provide for equitable assignment of a mortgage.[30] Massachusetts law simply differs from Florida law and, as such, cannot create any type of exception to the still valid Florida General Rule. A creditor who holds a validly endorsed promissory note is deemed to hold an equitable lien arising from the related mortgage, without any requirement to have a separate valid assignment of the mortgage.[31]

Deutsche Bank, however, still has not proven to either the trustee or the Court that it holds a validly endorsed promissory note evidencing its purchase of the debt on the disputed property. Therefore, Deutsche Bank cannot rely on the General Rule to avoid responding to the trustee’s discovery requests pertaining to the authenticity of the note. The trustee has raised in her complaint doubts concerning the authenticity and effectiveness of the endorsements on the allonge to the note. The copies of the note and mortgage attached as an exhibit to its response therefore are insufficient to establish Deutsche Bank’s status as holder of the note.

Because the trustee has raised issues concerning the authenticity of and authority to endorse the note and allonge, the Court will overrule Deutsche Bank’s objection and compel its response to interrogatory number 5, seeking the names and addresses of “each person whose signature appears on any endorsements on the Note or any allonge.” The Court similarly will overrule Deutsche Bank’s objections and 192*192 compel its response to requests for production numbers 7 and 30. These requests seek documents and information related to Deutsche Bank’s purchase of the note and the authority of the individual who signed the endorsement. The inquiries are relevant to whether Deutsche Bank is the holder of a properly endorsed note.

The Court will sustain Deutsche Bank’s objections to every other interrogatory[32] and document production request,[33] finding such requests are irrelevant and overbroad in light of the General Rule. In particular, information on the chain of title of the mortgage, which parties have ever held an interest in the note or mortgage, and the electronic records related to this mortgage is irrelevant to the question of whether Deutsche Bank now holds the original validly endorsed note.

Accordingly, the Court will partially grant and partially deny the trustee’s motion to compel and direct defendant Deutsche Bank to respond to certain of the trustee’s first set of interrogatories and document production requests on or before June 3, 2011, as specified above. A further pretrial conference is set in this adversary proceeding for 2:00 p.m. on June 22, 2011.

A separate order consistent with this memorandum opinion will be entered simultaneously.

DONE AND ORDERED.

[1] As discussed below, the trustee’s discovery requests actually were served on Deutsche Bank’s predecessor to this adversary proceeding, Aurora Loan Services. Deutsche Bank has stipulated for purposes of this motion to compel that such requests were served on it, too. The Court similarly assumes that Deutsche Bank is authorized to prosecute the objections to the trustee’s discovery requests previously articulated by Aurora Loan Services and, for purposes of this motion, the interest of Deutsche Bank and Aurora Loan Services are identical.

[2] Defendant’s Response to Trustee’s Amended and Renewed Motion to Compel Defendant’s Response to Trustee’s First Interrogatories and Trustee’s First Request for Production of Documents and Incorporated Memorandum of Law (Doc. No. 25). A list of defendant’s specific objections to particular interrogatories and production requests is attached to its Response as Exhibit B.

[3] Trustee’s Amended and Renewed Motion to Compel Defendant’s Response to Trustee’s First Interrogatories and Trustee’s First Request for Production of Documents (Doc. No. 23).

[4] All references to the Bankruptcy Code are to Title 11 of the United States Code.

[5] Doc. No. 22 in the Main Case.

[6] Doc. No. 36 in the Main Case.

[7] Doc. Nos. 7, 8.

[8] Doc. No. 15.

[9] Fn. 4 of Defendant’s Response (Doc. No. 25). Deutsche Bank has adopted Aurora’s objections by incorporating them as Exhibit B to its Response.

[10] Doc. No. 17.

[11] Doc. No. 19.

[12] Doc. Nos. 23, 24.

[13] Doc. No. 25.

[14] Doc. No. 25 and Ex. B thereto set forth the bank’s specific objections.

[15] Paragraph 16 of the copy of the mortgage attached as Exhibit A to Defendant’s Response (Doc. No. 25) states the applicable law is the “law in which the property is located.” The property is located in Rockledge, Florida, and neither party disputes that Florida law applies.

[16] Johns v. Gillian, 134 Fla. 575, 184 So. 140, 143 (1938) (citations omitted).

[17] Id. (quoting 41 C.J., Mortgages, Sec. 686, p. 677) (quotations omitted).

[18] Id. at 143-44 (citing Pease v. Warren, 29 Mich. 9, 18 Am.Rep 58).

[19] Riggs v. Aurora Loan Services, LLC, 36 So.3d 932 (Fla. 4th DCA 2010) (per curiam); WM Specialty Mortgage, LLC, v. Salomon, 874 So.2d 680, 682-3 (Fla. 4th DCA 2004).

[20] 36 So.3d at 933-34.

[21] Id.

[22] WM Specialty Mortgage, 874 So.2d at 682-3.

[23] 566 So.2d 885, 886 (Fla 4th DCA 1990).

[24] 36 So.3d at 933-34.

[25] Doc. No. 24.

[26] 184 So. at 143.

[27] Specifically, one of the main issues in Johns was whether a possibly dissolved corporation properly transferred its ownership of a mortgage. Because factual issues arose as to the timing of the corporation’s assignment of the mortgage, the purported purchaser of the note and mortgage testified in court as to his purchase of the debt. Johns makes no mention of the lack of a written assignment of the mortgage as the reason for the purported note holder’s testimony. The trustee’s interpretation of Johns as establishing a requirement under Florida law that without a written assignment of mortgage a purported note holder must go beyond proof of its status as note holder to establish the purchase of the debt, including chain of title and the entire ownership history of the note, therefore is strained and unsupported by the facts of the case.

[28] U.S. Bank N.A. v. Ibanez, 458 Mass. 637, 941 N.E.2d 40, 53-4 (2011).

[29] Id. (citations omitted).

[30] Id. (citing Barnes v. Boardman, 149 Mass. 106, 114, 21 N.E. 308 (1889) and quoting within the citation “In some jurisdictions it is held that the mere transfer of the debt, without any assignment or even mention of the mortgage, carries the mortgage with it, so as to enable the assignee to assert his title in an action at law … This doctrine has not prevailed in Massachusetts….”).

[31] The trustee also argues the Florida U.C.C. has abolished the General Rule. This proposition has no support in either the Florida U.C.C. or, as demonstrated by the recent Fourth D.C.A. decisions discussed above, in Florida case law.

[32] In particular, the objections are sustained as to interrogatory numbers: 1, 2, 3, 8, 9, 10, 13, 16, 17.

[33] In particular, the objections are sustained as to requests for production numbers: 8, 9, 10, 11, 17, 18, 19, 20, 22, 23.

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In re: GILBERT | NC Appeals Court Reversal “Improper Indorsement, No Evidence of Debt” JEFFREY STEPHAN AFFIDAVIT, DEUTSCHE BANK, GMAC, RESIDENTIAL FUNDING

In re: GILBERT | NC Appeals Court Reversal “Improper Indorsement, No Evidence of Debt” JEFFREY STEPHAN AFFIDAVIT, DEUTSCHE BANK, GMAC, RESIDENTIAL FUNDING

Here’s a snippet and highly recommend reading this in its entirety!

Excerpt:

The record is void of any evidence the Note was assigned and securitized to a trust.

[ipaper docId=54673705 access_key=key-1dch86ck9zy229rl5p87 height=600 width=600 /]

IN THE MATTER OF THE FORECLOSURE BY DAVID A. SIMPSON, P.C., SUBSTITUTE TRUSTEE, OF A DEED OF TRUST EXECUTED BY REX T. GILBERT, JR. AND DANIELA L. GILBERT, HUSBAND AND WIFE, DATED MAY 5, 2006 AND RECORDED ON MAY 10, 2006, IN BOOK 219 AT PAGE 53 OF THE HYDE COUNTY PUBLIC REGISTRY.

No. COA10-361.

Court of Appeals of North Carolina.

Filed May 3, 2011.

Katherine S. Parker-Lowe, for respondent-appellants.

The Law Office of John T. Benjamin, Jr., P.A., by John T. Benjamin, Jr. and James R. White for petitioner-appellee.

HUNTER, JR., Robert N., Judge.

Respondents Rex T. Gilbert, Jr. and his wife Daniela L. Gilbert, appeal from the trial court’s Order authorizing David A. Simpson, P.C., as Substitute Trustee, to proceed with foreclosure under a power of sale in the Deed of Trust recorded in Book 219 at Page 53 in the Hyde County Register of Deeds. We reverse.

I. Factual and Procedural History

On 5 May 2006, Respondent Rex T. Gilbert, Jr. executed an adjustable rate note (“the Note”) to refinance an existing mortgage on his home. According to the terms of the Note, Mr. Gilbert promised to pay a principal amount of $525,000.00 plus interest to First National Bank of Arizona. The Note was secured by a Deed of Trust, executed by Mr. Gilbert and his wife, Daniela L. Gilbert, on real property located at 134 West End Road, Ocracoke, North Carolina. The Deed of Trust identified First National Bank of Arizona as the lender and Matthew J. Ragaller of Casey, Grimsley & Ragaller, PLLC as the trustee.

The record reveals that, during 2008, Respondents ceased making payments on the Note and made an unsuccessful attempt to negotiate a modification of the loan. On 9 March 2009, a Substitution of Trustee was recorded in the Hyde County Register of Deeds, which purports to remove Matthew Ragaller as the trustee of the Deed of Trust and appoint his successor, David A. Simpson, P.C. (“Substitute Trustee”). The Substitution of Trustee identified Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 (“Petitioner”) as the holder of the Note and the lien created by the Deed of Trust.

On 12 March 2009, the Substitute Trustee commenced this action by filing a Notice of Hearing on Foreclosure of Deed of Trust with the Hyde County Clerk of Superior Court pursuant to section 45-21.16 of our General Statutes. N.C. Gen. Stat. § 45-21.16 (2009). The Notice of Hearing stated, “the current holder of the foregoing Deed of Trust, and of the debt secured thereby, is: Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6.”

In a letter dated 5 April 2009, Mr. Gilbert purported to exercise his right to rescind the loan transaction he entered into with the original lender, First National Bank of Arizona, pursuant to the federal Truth in Lending Act, 15 U.S.C. § 1635. As justification for his purported rescission, Gilbert alleged that the Truth in Lending Disclosure Statement provided by First National Bank of Arizona failed to accurately provide all required material disclosures including, inter alia, the correct annual percentage rate and payment schedule. The Substitute Trustee responded with a letter from GMAC ResCap, in which it denied any material disclosure errors were made and refused to rescind the loan transaction.

The foreclosure hearing was held on 2 June 2009 before the Clerk of Superior Court of Hyde County. The Honorable Sharon G. Sadler entered an Order on 17 June 2009, permitting the Substitute Trustee to proceed with the foreclosure. In the Order, the Clerk specifically found, inter alia, that Petitioner was the holder of the Note and Deed of Trust that it sought to foreclose and the Note evidenced a valid debt owed by Mr. Gilbert. Respondents appealed the Order to superior court.

The matter came on for a de novo hearing on 18 August 2009 before the Honorable Marvin K. Blount, III, in Hyde County Superior Court. During the hearing, the trial court admitted into evidence a certified copy of the Note and the Deed of Trust and two affidavits attesting to the validity of Gilbert’s indebtedness pursuant to the Note, and that Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 is the current owner and holder of the Note. Additionally, Petitioner introduced the original Note and Allonge for the trial court’s inspection.

Reviewing the record before this Court, the Allonge contains a series of indorsements evidencing the alleged assignments of the Note, as follows:

PAY TO THE ORDER OF: First National Bank of Nevada WITHOUT RECOURSE BY: [Signature] ___________________________ AMY HAWKINS, ASSISTANT VICE PRESIDENT FIRST NATIONAL BANK OF ARIZONA Pay to the order of: RESIDENTIAL FUNDING CORPORATION Without Recourse FIRST NATIONAL BANK OF NEVADA By: [Signature] __________________________ Deutsche Bank National Trust Company, F/K/A Bankers Trust Company of California, N.A. as Custodian as Attorney in Fact [Illegible Name and Title] PAY TO THE ORDER OF Deutsche Bank Trust Company Americas as Trustee WITHOUT RECOURSE Residential Funding Corporation BY [Signature] ________________________ Judy Faber, Vice President

Respondents made two arguments at the hearing. First, Respondents argued that the debt evidenced by the Note no longer existed, as Mr. Gilbert had rescinded the transaction for the loan with First National Bank of Arizona. Petitioner objected to Respondents’ rescission argument as being a defense in equity and, as such, inadmissible in a proceeding held pursuant to N.C. Gen. Stat. § 45-21.16. The trial court agreed and refused to let Respondents’ expert witness testify as to alleged material errors in the Truth in Lending Disclosure Statement, which Mr. Gilbert alleged permitted him the right to rescind the loan. Second, Respondents argued that Petitioner had not produced sufficient evidence to establish that Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 was the holder of the Note.

Based on the preceding evidence, the trial court entered an order on 18 August 2009 in which it found, inter alia: Mr. Gilbert executed the Note and, with his wife, executed a Deed of Trust in favor of First National Bank of Arizona, secured by the real property described in the Deed of Trust; a valid debt exists and is owed by Gilbert to Petitioner; Gilbert is in default under the Note and Deed of Trust; proper notice of the foreclosure hearing was given to all parties as required by N.C. Gen. Stat. § 45-21.16; Petitioner was the current holder of the Note and the Deed of Trust. The trial court concluded as a matter of law that the requirements of N.C. Gen. Stat. § 45-21.16 had been satisfied. Based on these findings and conclusion of law, the trial court authorized the Substitute Trustee to proceed with the foreclosure. Respondents timely entered notice of appeal.

II. Analysis

A party seeking permission from the clerk of court to proceed with a foreclosure pursuant to a power of sale contained in a deed of trust must prove the following statutory requirements: (1) the party seeking foreclosure is the holder of a valid debt, (2) default on the debt by the debtor, (3) the deed of trust provides the right to foreclose, (4) proper notice was given to those parties entitled to notice pursuant to section 45-21.16(b). N.C. Gen. Stat. § 45-21.16(d) (2009). The General Assembly added a fifth requirement, which expired 31 October 2010: “that the underlying mortgage debt is not a subprime loan,” or, if it is a subprime loan, “that the pre-foreclosure notice under G.S. 45-102 was provided in all material respects, and that the periods of time established by Article 11 of this Chapter have elapsed[.]” Id. The role of the clerk of court is limited to making a determination on the matters specified by section 45-21.16(d). See Mosler ex rel. Simon v. Druid Hills Land Co., Inc., 199 N.C. App. 293, 295-96, 681 S.E.2d 456, 458 (2009). If the clerk’s order is appealed to superior court, that court’s de novo hearing is limited to making a determination on the same issues as the clerk of court. See id.

The trial court’s order authorizing the foreclosure to proceed was a final judgment of the superior court, therefore, this Court has jurisdiction to hear the instant appeal. N.C. Gen. Stat. § 7A-27(b) (2009). Our standard of review for this appeal, where the trial court sat without a jury, is “`whether competent evidence exists to support the trial court’s findings of fact and whether the conclusions reached were proper in light of the findings.'” In re Adams, __ N.C. App. __, __, 693 S.E.2d 705, 708 (2010) (quoting In re Foreclosure of Azalea Garden Bd. & Care, Inc., 140 N.C. App. 45, 50, 535 S.E.2d 388, 392 (2000)).

We note the trial court classified multiple conclusions of law as “findings of fact.” We have previously recognized “[t]he classification of a determination as either a finding of fact or a conclusion of law is admittedly difficult.” In re Helms, 127 N.C. App. 505, 510, 491 S.E.2d 672, 675 (1997). Generally, “any determination requiring the exercise of judgment or the application of legal principles is more properly classified a conclusion of law.” Id. (citations omitted). Any determination made by “`logical reasoning from the evidentiary facts,'” however, “is more properly classified a finding of fact.” Id. (quoting Quick v. Quick, 305 N.C. 446, 452, 290 S.E.2d 653, 657-58 (1982)). When this Court determines that findings of fact and conclusions of law have been mislabeled by the trial court, we may reclassify them, where necessary, before applying our standard of review. N.C. State Bar v. Key, 189 N.C. App. 80, 88, 658 S.E.2d 493, 499 (2008) (citing In re Helms, 127 N.C. App. at 510, 491 S.E.2d at 675).

Looking to the trial court’s Order, we conclude that the following “findings of fact” are determinations that required the application of legal principles and are more appropriately classified as conclusions of law: a valid debt exists and is owed to Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6; proper notice was given to and received by all parties as required by N.C. Gen. Stat. § 45-21.16 and the Rules of Civil Procedure; Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 is the current owner and holder of the Note and Deed of Trust. See In re Watts, 38 N.C. App. 90, 92, 247 S.E.2d 427, 428 (1978) (noting upon the appeal of a N.C. Gen. Stat. § 45-21.16 special proceeding the trial court’s conclusions of lawsee also Connolly v. Potts, 63 N.C. App. 547, 549, 306 S.E.2d 123, 124 (1983) (same). In light of this reclassification of the trial court’s findings of fact and conclusions of law, we turn to the issues raised on appeal. included the existence of a valid debt, the right to foreclose under the deed of trust, and proper notice to the mortgagors);

1. Rescission of the Loan Transaction

Respondents raise several arguments alleging the trial court erred by refusing to consider their defense to the foreclosure action, that the debt Petitioner sought to foreclose was not a valid debt——a required element under the statute for foreclosure by power of sale. See N.C. Gen. Stat. § 45-21.16(d)(i) (requiring, inter alia, that the clerk of court must determine that a valid debt exists). Respondents contend the debt is not valid because Mr. Gilbert rescinded the transaction by which he obtained the loan from First National Bank of Arizona pursuant to the federal Truth in Lending Act (“TILA”), 15 U.S.C. §§ 1601-1667f, and the Federal Reserve Board’s Regulation Z, 12 C.F.R. § 226.1-.58. We conclude the trial court did not err.

The admissibility of evidence in the trial court is based upon that court’s sound discretion and may be disturbed on appeal only upon a finding that the decision was based on an abuse of discretion. Gibbs v. Mayo, 162 N.C. App. 549, 561, 591 S.E.2d 905, 913 (2004). Here, we conclude the trial court properly refused to consider Respondents’ evidence of rescission. Rescission under the TILA is an equitable remedy. See Am. Mortg. Network, Inc. v. Shelton, 486 F.3d 815, 819 (4th Cir. 2007) (“`[A]lthough the right to rescind [under the TILA] is [statutory], it remains an equitable doctrine subject to equitable considerations.'” (quoting Brown v. Nat’l Permanent Fed. Sav. & Loan Ass’n, 683 F.2d 444, 447 (D.C. Cir. 1982)). While legal defenses to a foreclosure under a power of sale are properly raised in a hearing held pursuant to section 45-21.16, equitable defenses are not. Watts, 38 N.C. App. at 94, 247 S.E.2d at 429. As we have previously stated, a hearing under section 45-21.16 is “not intended to settle all matters in controversy between mortgagor and mortgagee, nor was it designed to provide a second procedure for invoking equitable relief.” Id. A party seeking to raise an equitable defense may do so in a separate civil action brought in superior court under section 45-21.34. Id.; N.C. Gen. Stat. § 45-21.34 (2009) (stating that a party with a legal or equitable interest in the subject property may apply to a superior court judge to enjoin a sale of the property upon legal or equitable grounds). Accordingly, the trial court properly concluded Respondents’ argument that Mr. Gilbert had rescinded the loan transaction, invaliding the debt Petitioner sought to foreclose, was an equitable defense and not properly before the trial court. Respondents’ argument is without merit.[1]

2. Evidence that Petitioner was the Owner and Holder of Mr. Gilbert’s Promissory Note

Respondents also argue the trial court erred in ordering the foreclosure to proceed, as Petitioner did not prove that it was the holder of the Note with the right to foreclose under the instrument as required by section 45-21.16(d)(i) and (iii). We agree.

A “foreclosure under a power of sale is not favored in the law and its exercise will be watched with jealousy.” In re Foreclosure of Goforth Props., Inc., 334 N.C. 369, 375, 432 S.E.2d 855, 859 (1993) (citations and internal quotation marks omitted). That the party seeking to foreclose on a promissory note is the holder of said note is an essential element of the action and the debtor is “entitled to demand strict proof of this element.” Liles v. Myers, 38 N.C. App. 525, 528, 248 S.E.2d 385, 388 (1978).

For the trial court to find sufficient evidence that Petitioner is the holder of a valid debt in accordance with section 45-21.16(d), “this Court has determined that the following two questions must be answered in the affirmative: (1) `is there sufficient competent evidence of a valid debt?’; and (2) `is there sufficient competent evidence that [the party seeking to foreclose is] the holder[ ] of the notes [that evidence that debt]?'” Adams, __ N.C. App. at __, 693 S.E.2d at 709 (quoting In re Cooke, 37 N.C. App. 575, 579, 246 S.E.2d 801, 804—05 (1978)); see N.C. Gen. Stat. § 45-21.16(d) (2009) (in order for the foreclosure to proceed, the clerk of court must find, inter alia, the existence of a “valid debt of which the party seeking to foreclose is the holder,” and a “right to foreclose under the instrument” securing the debt) (emphasis added).

Establishing that a party is the holder of the note is essential to protect the debtor from the threat of multiple judgments on the same note.

If such proof were not required, the plaintiff could negotiate the instrument to a third party who would become a holder in due course, bring a suit upon the note in her own name and obtain a judgment in her favor. . . . Requiring proof that the plaintiff is the holder of the note at the time of her suit reduces the possibility of such an inequitable occurrence.

Liles, 38 N.C. App. at 527, 248 S.E.2d at 387.

We have previously determined that the definition of “holder” under the Uniform Commercial Code (“UCC”), as adopted by North Carolina, controls the meaning of the term as it used in section 45-21.16 of our General Statutes for foreclosure actions under a power of sale. See Connolly, 63 N.C. App. at 550, 306 S.E.2d at 125; Adams, __ N.C. App. at __, 693 S.E.2d at 709. Our General Statutes define the “holder” of an instrument as “[t]he person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession.” N.C. Gen. Stat. § 25-1-201(b)(21) (2009); Econo-Travel Motor Hotel Corp. v. Taylor, 301 N.C. 200, 203, 271 S.E.2d 54, 57 (1980). Furthermore, a “`[p]erson’ means an individual, corporation, business trust, estate, trust . . . or any other legal or commercial entity.” N.C. Gen. Stat. § 25-1-201(b)(27) (2009).

As addressed above, we conclude the trial court properly found that a valid debt existed. The remaining issue before this Court is whether there was competent evidence that Petitioner was the holder of the Note that evidences Mr. Gilbert’s debt.

In support of its argument that it provided competent evidence to support the trial court’s findings, Petitioner first points to its production of the original Note with the Allonge at the de novo hearing, as well as its introduction into evidence true and accurate copies of the Note and Allonge. Petitioner asserts this evidence “plainly evidences the transfers” of the Note to Petitioner. We cannot agree.

Under the UCC, as adopted by North Carolina, “[a]n instrument is transferred when it is delivered by a person other than its issuer for the purpose of giving to the person receiving delivery the right to enforce the instrument.” N.C. Gen. Stat. § 25-3-203(a) (2009). Production of an original note at trial does not, in itself, establish that the note was transferred to the party presenting the note with the purpose of giving that party the right to enforce the instrument, as demonstrated in Connolly, 63 N.C. App. at 551, 306 S.E.2d at 125, and Smathers v. Smathers, 34 N.C. App. 724, 726, 239 S.E.2d 637, 638 (1977) (holding that despite evidence of voluntary transfer of promissory notes and the plaintiff’s possession thereof, the plaintiff was not the holder of the note under the UCC as the notes were not drawn, issued, or indorsed to her, to bearer, or in blank. “[T]he plaintiff testified to some of the circumstances under which she obtained possession of the notes, but the trial court made no findings of fact with respect thereto.”)

In Connolly, determining who had possession of the note became the critical question for the foreclosure proceeding. 63 N.C. App. at 551, 306 S.E.2d at 125. Several years prior to the foreclosure proceedings at issue in Connolly, the petitioners obtained a loan from a bank and pledged as collateral a promissory note that was payable to the petitioners by assigning and delivering the note to the bank. Id. at 549, 306 S.E.2d at 124. After obtaining their loan, the petitioners sought to foreclose on the promissory note and deed of trust, which was in the bank’s possession, but were denied at the special proceeding before the clerk of court. Id. at 548, 306 S.E.2d at 124. The petitioners appealed the decision to superior court. Id. During the de novo hearing, the petitioners testified their loan to the bank had been paid, but “they had left the [] note at the bank, for security purposes.” Id. at 551, 306 S.E.2d at 125. The petitioners, however, “introduced the originals of the note and deed of trust” during the hearing. Id. The trial court found the bank was in possession of the note and concluded, as a matter of law, the petitioners were not the holders of the note at the institution of the foreclosure proceedings; the foreclosure was again denied. Connolly, 63 N.C. App. at 550, 306 S.E.2d at 124-25. On appeal, this Court concluded that despite the fact that the party seeking foreclosure introduced the original note at the time of the de novo hearing, the trial court’s findings of fact did not address whether the petitioners were in possession of the note at the time of the trial; the trial court’s judgment was vacated and remanded. Id. at 551, 306 S.E.2d at 125-26.

Similarly, here, the trial court’s findings of fact do not address who had possession of Mr. Gilbert’s note at the time of the de novo hearing. Without a determination of who has physical possession of the Note, the trial court cannot determine, under the UCC, the entity that is the holder of the Note. See N.C. Gen. Stat. § 25-1-201(b)(21) (defining “holder” as “the person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession“) (emphasis added); Connolly, 63 N.C. App. at 550, 306 S.E.2d at 125 (“It is the fact of possession which is significant in determining whether a person is a holder, and the absence of possession defeats that status.“) (emphasis added). Accordingly, the trial court’s findings of fact do not support the conclusion of law that Petitioner is the holder of Mr. Gilbert’s note.

Assuming arguendo that production of the Note was evidence of a transfer of the Note pursuant to the UCC and that Petitioner was in possession of the Note, this is not sufficient evidence that Petitioner is the “holder” of the Note. As discussed in detail below, the Note was not indorsed to Petitioner or to bearer, a prerequisite to confer upon Petitioner the status of holder under the UCC. See N.C. Gen. Stat. § 25-1-201(b)(21) (requiring that, to be a holder, a person must be in possession of the note payable to bearer or to the person in possession of the note). “`[M]ere possession’ of a note by a party to whom the note has neither been indorsed nor made payable `does not suffice to prove ownership or holder status.'” Adams, __ N.C. App. at __, 693 S.E.2d at 710 (quoting Econo-Travel Motor Hotel Corp., 301 N.C. at 203, 271 S.E.2d at 57).

Petitioner acknowledges that following the signing of the Note by Mr. Gilbert, the Note was sequentially assigned to several entities, as indicated by the series of indorsements on the Allonge, reprinted above. Respondents argue these indorsements present two problems. First, Respondents state that Petitioner did not provide any evidence to establish that Deutsche Bank National Trust Company had the authority, as the attorney-in-fact for First National Bank of Nevada, to assign the Note to Residential Funding Corporation in the second assignment. Respondents make no argument——and cite no authority to establish——that such evidence is needed. Therefore, we do not address the merits of this alleged error and deem it abandoned. See N.C. R. App. P. 28(6) (2011) (“Issues not presented in a party’s brief, or in support of which no reason or argument is stated, will be taken as abandoned.”)

Second, Respondents argue Petitioner has not offered sufficient evidence that Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 was the holder of the Note and, thus, the party entitled to proceed with the foreclosure action. We agree.

Respondents note the third and final assignment on the Allonge was made to “Deutsche Bank Trust Company Americas as Trustee,” which is not the party asserting a security interest in Respondents’ property; this action was brought by Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6, the entity the trial court found to be the owner and holder of the Note. Section 3-110 of the UCC, as codified in our General Statutes, states in pertinent part:

For the purpose of determining the holder of an instrument, the following rules apply:

. . . .

(2) If an instrument is payable to (i) a trust, an estate, or a person described as trustee or representative of a trust or estate, the instrument is payable to the trustee, the representative, or a successor of either, whether or not the beneficiary or estate is also named . . . .

N.C. Gen. Stat. § 25-3-110(c) (2009) (emphasis added). Additionally, the official comments to this section of the UCC state, in part, “This provision merely determines who can deal with an instrument as a holder. It does not determine ownership of the instrument or its proceeds.” Id. § 25-3-110, Official Comment 3.

In the present case, the Note is clearly indorsed “PAY TO THE ORDER OF Deutsche Bank Trust Company Americas as Trustee.” Thus, pursuant to section 25-3-110(c)(2), the Note is payable to Deutsche Bank Trust Company Americas as Trustee. See Id. Because the indorsement does not identify Petitioner and is not indorsed in blank or to bearer, it cannot be competent evidence that Petitioner is the holder of the Note. See N.C. Gen. Stat. § 25-1-201(b)(21) (defining “holder” as “[t]he person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession“); Econo-Travel Motor Hotel Corp., 301 N.C. at 204, 271 S.E.2d at 57 (concluding that where the defendants produced a copy of the note indorsed to an entity other than the plaintiff, the “defendants established that plaintiff was not the owner or holder of the note”).

In addition to the Note and Allonge, Petitioner points to two affidavits provided by two GMAC Mortgage employees as further evidence that the trial court’s findings are based on sufficient competent evidence. Again, we disagree.

The first affidavit is an Affidavit of Indebtedness by Jeffrey Stephan (“Stephan”).[2] In his affidavit, Stephan averred, inter alia, he was a limited signing officer for GMAC Mortgage, the sub-servicer of Mr. Gilbert’s loan, and as such, was “familiar with the books and records of [GMAC Mortgage], specifically payments made pursuant to the Note and Deed of Trust.” Accordingly, Stephan testified as to the principal amount of Mr. Gilbert’s loan and to his history of loan payments. Stephan further testified that after the Note and Deed of Trust were executed they were “delivered” to the original lender, First National Bank of Arizona; the original lender then “assigned and transferred all of its right, title and interest” to First National Bank of Nevada, which, in turn, assigned all its rights, title, and interest in the instruments to Residential Funding Corporation. The final assignment to which Stephan averred is an assignment and securitization of the Note and Deed of Trust from Residential Funding Corporation to “Deutsche Bank Trust Company Americas as Trustee.” Stephan then makes the conclusory statement, “Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 is the current owner and holder of the Note and Deed of Trust described herein.”

Whether Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 is the owner and holder of the Note and Deed of Trust is a legal conclusion that is to be determined by a court of law on the basis of factual allegations. As such, we disregard Stephan’s conclusion as to the identity of the “owner and holder” of the instruments. See Lemon v. Combs, 164 N.C. App. 615, 622, 596 S.E.2d 344, 349 (2004) (“`Statements in affidavits as to opinion, belief, or conclusions of law are of no effect.'” (quoting 3 Am. Jur. 2d, Affidavits § 13 (2002))); see also Speedway Motorsports Int’l Ltd. v. Bronwen Energy Trading, Ltd., __ N.C. App. __, __ n.2, __ S.E.2d __, __ n.2, slip op. at 12 n.2, No. 09-1451 (Feb. 15, 2011) (rejecting a party’s contention that this Court must accept as true all statements found in the affidavits in the record, stating, “our standard of review does not require that we accept a witness’ characterization of what `the facts’ mean”). While Stephan referred to a Pooling and Servicing Agreement (“PSA”) that allegedly governs the securitization of the Note to Deutsche Bank Trust Company Americas as Trustee, the PSA was not included in the record and will not be considered by this Court. See N.C. R. App. P. 9(a) (2011) (“In appeals from the trial division of the General Court of Justice, review is solely upon the record on appeal, the verbatim transcript of proceedings, if one is designated, and any other items filed pursuant to this Rule 9.”) The record is void of any evidence the Note was assigned and securitized to a trust.

We also note that Stephan alleged no facts as to who possesses Mr. Gilbert’s note, other than his averment that the Note was “delivered” to the original lender, First National Bank of Arizona. Stephan referred to a statement made by counsel for GMAC Mortgage that the original Note “would be brought to the foreclosure hearing,” but he did not provide any facts from which the trial court could determine who has possession of the Note. As demonstrated by Connolly,63 N.C. App. at 551, 306 S.E.2d at 125. Thus, we conclude Stephan’s affidavit is not competent evidence to support the trial court’s conclusion that Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 is the owner and holder of Mr. Gilbert’s note. discussed above, production of a note at trial is not conclusive evidence of possession.

Petitioner also provided the affidavit of Scott Zeitz (“Zeitz”), who alleged in his affidavit to be a litigation analyst for GMAC Mortgage. Zeitz’s basis for his affidavit testimony is that he works with “the documents that relate to account histories and account balances of particular loans” and that he is familiar with Mr. Gilbert’s account. Accordingly, Zeitz testified to the details of Mr. Gilbert’s loan and the terms of the Note. Zeitz’s affidavit, substantially similar to the affidavit of Jeffrey Stephan, also averred to the transfer of the Note and Deed of Trust through the series of entities indicated on the Allonge, stating in part:

Residential Funding Corporation sold, assigned and transferred all of its right, title and interest in and to the Note and Deed of Trust to Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6. This is reflected on the Allonge to the Note, a true and accurate copy of which is attached and incorporated hereto as EXHIBIT 5. (Emphasis added.)

This statement is factually incorrect; the Allonge in the record contains no indorsement to Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6. Zeitz further stated that “Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 is the current owner and holder of the Note and Deed of Trust.” This statement is a legal conclusion postured as an allegation of fact and as such will not be considered by this Court. See Lemon, 164 N.C. App. at 622, 596 S.E.2d at 349.

Unlike Jeffrey Stephan, Zeitz stated that Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 “has possession of the original Note and Deed of Trust.” We note, however, that “[w]hen an affiant makes a conclusion of fact, it must appear that the affiant had an opportunity to observe and did observe matters about which he or she testifies.” Lemon, 164 N.C. App. at 622, 596 S.E.2d at 348-49 (quoting 3 Am. Jur. 2d Affidavits § 13) (internal quotation marks omitted). Moreover,

[t]he personal knowledge of facts asserted in an affidavit is not presumed from a mere positive averment of facts but rather the court should be shown how the affiant knew or could have known such facts and if there is no evidence from which an inference of personal knowledge can be drawn, then it is presumed that such does not exist.

Id. at 622-23, 596 S.E.2d at 349 (quoting 3 Am. Jur. 2d Affidavits § 14, cited with approval in Currituck Associates Residential P’ship v. Hollowell, 170 N.C. App. 399, 403-04, 612 S.E.2d 386, 389 (2005)). Thus, while Zeitz concluded as fact that Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 has possession of the Note, his affidavit provides no basis upon which we can conclude he had personal knowledge of this alleged fact. Because of these deficiencies, we conclude that neither the affidavit of Jeffrey Stephan nor the affidavit of Scott Zeitz is competent evidence to support the trial court’s finding that Deutsche Bank Trust Company Americas as Trustee for Residential Accredit Loans, Inc. Series 2006-QA6 is the owner and holder of Mr. Gilbert’s note.

III. Conclusion

We conclude the record is lacking of competent evidence sufficient to support that Petitioner is the owner and holder of Mr. Gilbert’s note and deed of trust. The trial court erred in permitting the Substitute Trustee to proceed with foreclosure proceedings and its order is

Reversed.

Judges MCGEE and BEASLEY concur.

[1] During the pendency of this action, the Gilberts filed a separate action against Deutsche Bank Trust Company Americas, Residential Funding, LLC, GMAC Mortgage, LLC, and David A. Simpson, P.C. to litigate, inter alia, their TILA claim in Hyde County Superior Court. The defendants removed the action to federal court. See Gilbert v. Deutsche Bank Trust Co. Americas, slip op. at 1, 4:09-CV-181-D, 2010 WL 2696763 (E.D.N.C. July 7, 2010), reconsideration denied, 2010 WL 4320460 (E.D.N.C. Oct. 19, 2010). Because the Gilberts’ claim was filed more than three years after the loan transaction was completed, the federal trial court dismissed the action for failure to state a claim upon which relief could be granted. Id. at __, slip op. at 5.

[2] This Court finds troubling that GMAC Mortgage, LLC was recently found to have submitted a false affidavit by Signing Officer Jeffrey Stephan in a motion for summary judgment against a mortgagor in the United States District Court of Maine. Judge John H. Rich, III concluded that GMAC Mortgage submitted Stephan’s false affidavit in bad faith and levied sanctions against GMAC Mortgage, stating:

[T]he attestation to the Stephan affidavit was not, in fact, true; that is, Stephan did not know personally that all of the facts stated in the affidavit were true. . . . GMAC [Mortgage] was on notice that the conduct at issue here was unacceptable to the courts, which rely on sworn affidavits as admissible evidence in connection with motions for summary judgment. In 2006, an identical jurat signed under identical circumstances resulted in the imposition of sanctions against GMAC [Mortgage] in Florida. James v. U.S. Bank Nat. Ass’n, 272 F.R.D. 47, 48 (D. Me. 2011).

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DEPOSITIONS

DEPOSITIONS

Last updated- 3/27/2014

Full Deposition of JPMorgan/WaMU Lawrence Nardi Part 1 – Just What Happened To All Those Wamu’s Notes?

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FDIC- JPMORGAN- CHASE HOME FINANCE- WASHINGTON MUTUAL JEFFREY THORNE

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Links to NationWide Title pending out come of ACLU Appeal read more here

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