Judge Limits $951M Deutsche Bank MBS Case To Bad Loans

Law360, New York (November 25, 2013, 3:40 PM EST) -- Investors in $951 million worth of Deutsche Bank AG mortgage-backed securities can pursue allegations that some of the securities' loans were defective, but they can't undo the whole deal based on alleged "fundamental breaches" of the contracts, a New York state judge ruled Monday.

Judge Shirley Werner Kornreich said that the investors, led by the securities' trustee, HSBC Holding PLC, could only use the so-called "sole remedy" repurchase provision in the contracts that govern the securities, which sets up the process for investors to demand that...
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