Class Action Suits Filed Regarding Pass-Through Certificates

Posted by Orb Staff on September 14, 2009 No Comments
Categories : Residential Mortgage

The law firms of Cohen Milstein Sellers & Toll PLLC (Cohen Milstein) and Coughlin Stoia Geller Rudman & Robbins LLP (Coughlin Stoia) have filed two class action lawsuits on behalf of purchasers of mortgage pass-through certificates issued by Structured Asset Mortgage Investments II Inc. (SAMI) and/or Bear Stearns Asset-Backed Securities I LLC (BSABSI).

The suits are pursuant to false and misleading registration statements and prospectus supplements issued between March 2006 and September 2007.

The actions are New Jersey Carpenters Health Fund v. Bear Stearns Mortgage Funding Trust 2006-AR1, et al., Docket No. 08-cv-8093-LTS (S.D.N.Y.), filed on August 20, 2008, and Pension Trust Fund for Operating Engineers v. Structured Asset Mortgage Investments II Inc., et al, Docket No. 09-cv-6172-LTS (S.D.N.Y.), filed July 9, 2009.

Cohen Milstein is representing the plaintiffs in the former action, and Coughlin Stoia is representing plaintiffs in the latter. The actions are pending in the Southern District of New York.

The actions allege that the registration statements and prospectuses contained material misstatements and omissions in violation of Sections 11, 12 and 15 of the Securities Act of 1933.

The certificates were supported by large pools of mortgage loans generally secured by first liens on residential properties, including conventional, adjustable-rate and negative-amortization mortgage loans.

According to the complaints filed in the actions, the registration statements included false statements and/or omissions about the underwriting standards purportedly used in connection with the origination of the underlying mortgage loans, the maximum loan-to-value ratios used to qualify borrowers, property appraisals and the debt-to-income ratios permitted on the loans.

SOURCES: Cohen Milstein, Coughlin Stoia

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