Judge throws out RMBS suits against Deutsche Bank
A federal judge dismissed two separate residential mortgage-backed securities lawsuits against Deutsche Bank on grounds that the fraud complaints did not meet "certain key respects" of civil procedure "despite their prolixity."
U.S. District Judge Jed Radkoff in Manhattan granted a motion early this week filed by the German lender in cases brought by Belgian bank Dexia and the Teachers Insurance and Annuity Association of America. The suits claimed Deutsche Bank misrepresented the quality of the RMBS.
Radkoff said he would clarify the flaws of the complaints in a forthcoming written opinion.
Dexia's suit argued Deutsche Bank sold them $1 billion of RMBS, but did not say high-risk loans backed the securities. A Senate subcommittee report said a top trader Deutsche Bank warned colleagues and clients about the quality of numerous RMBS, describing them as "crap" and "pigs."
The two lawsuits, however, relied on loans not sponsored by Deutsche Bank Structured Products, Radkoff said, though the plantiffs could refile based on loans sponsored by the bank division.