Big Banks' $165M Deal Gets Initial OK In NovaStar MBS Suit

Law360, New York (May 10, 2017, 3:17 PM EDT) -- A New York federal judge on Tuesday preliminarily approved a $165 million settlement to be paid by Wells Fargo, Deutsche Bank and the Royal Bank of Scotland, putting them one step closer to resolving a class action over their underwriting of $7.7 billion worth of mortgage-backed securities issued by bankrupt subprime lender NovaStar.

U.S. District Judge Deborah A. Batts gave an initial green light to the deal, which would end long-standing claims from investors, including union pension funds, who allege that Deutsche Bank Securities Inc., RBS Securities Inc. and Wachovia Capital Markets LLC — now Wells Fargo Advisors LLC — lied...

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