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Allstate, BofA agree to end toxic mortgage lawsuit [April 09, 2014] By Bernard Vaughan NEW YORK (Reuters) — Allstate Corp and Bank of America Corp's Countrywide unit have agreed to dismiss a lawsuit stemming from $700 million of toxic mortgage debt, according to a court filing on Tuesday.
The parties "have agreed to dismissal of this action in
its entirety," lawyers for Allstate and Countrywide said
in a document filed in U.S. District Court for the
Central District of California. The parties also waived any right to appeal, according to the document. |
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Terms of the agreement were unclear. "The parties have agreed to resolve the matter on mutually
agreeable terms," Daniel Brockett, a lawyer for Allstate, said
in a telephone call Tuesday night. Representatives for Allstate and BofA declined to comment. In 2011, a U.S. District Judge Mariana Pfaelzer in Los Angeles
narrowed the lawsuit when she tossed federal securities law
claims Allstate had brought against mortgage lender Countrywide
over the debt, saying Allstate waited too long to sue. She also
dismissed Bank of America, which acquired Countrywide in 2008,
as a defendant. However, Pfaelzer let Allstate pursue state law claims accusing
Countrywide of failing to tell investors that loans underlying
its mortgage securities did not comply with its own underwriting
standards. The case is Allstate Insurance Co et al v. Countrywide Financial
Corp et al, U.S. District Court, Central District of California,
No. 11-05236. (Reporting by Bernard Vaughan; additional reporting by Karen Freifeld.) [© 2014 Thomson Reuters. All rights reserved.] Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
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