Allstate federal claims against Countrywide dismissed
Allstate lost momentum in federal court Monday when a judge barred much of the insurer's RMBS claims against Countrywide. U.S. District Court Judge Mariana Pfaelzer out of the Central District of California dismissed Allstate's federal claims against the subprime lender. Countrywide was purchased by Bank of America (BAC) in 2008. The suit is over millions in securities backed by toxic Countrywide loans that Allstate acquired prior to the mortgage meltdown. The original case was filed in December 2010. Judge Pfaelzer held that the federal claims are time-barred and dismissed them with prejudice. In addition, the judge dismissed Allstate's aiding and abetting claims and misrepresentations claims against the lending firms, saying they were inadequately pleaded. However, the judge is allowing Allstate to proceed with its common law fraud claims. Write to Kerri Panchuk.