NY State Court Halts Judge Shopping in RMBS Putback Cases

UPDATE 4pm: The NY Courts have now issued an official policy about their ‘One Judge’ for RMBS cases. Ironically on the same day I started asking questions about these private decision they are now public!

Orignal Text
Banks looking to judge shop in RMBS putback cases filed in New York State court are going to get shut out of the process. Apparently there are so many cases to litigate against banks, like JP Morgan and Credit Suisse selling billions of garbage mortgage securities to investors, that administrative judge Sherry Heitler has decreed all RMBS cases as of March 2013 now go to one judge. Roberta McClinton, Heitler’s law clerk, confirmed this today explaining that similar cases need to go to one judge now because it’s for ‘judicial economy’.

This news just came to light after I saw a non-public letter from Judge Heitler to JP Morgan’s outside counsel ,Andrew Cereseney and Robert Sacks, stating she appreciated JPM’s letter about their desire to have the NY AG’s civil fraud case against JP Morgan assigned to Judge Ramos but the court’s new policy is all commercial RMBS cases are now going to Judge Friedman. The problem is this doesn’t totally makes sense. The court is telling me on the record it’s for ‘judicial economy’ that like-cases go to one judge, and Judge Ramos already has the bulk of rmbs cases against JP Morgan, so why in March did the court suddenly choose to divert rmbs cases to new a judge? A judge who hasn’t seen a boat load of evidence about the ‘dogs’ and ‘sack of shit’ loans these bankers admitted, in their own emails, they were selling as safe investments to pension funds. Judge Friedman is known as a liberal ‘for the people’ judge. Judge Ramos has made comments in open court that these fraud claims by the monolines against JP Morgan are not something he is in favor of litigating.

Attorney Cereseney apparently grew a conscious after the NY AG’s case was assigned to Judge Friedman because in April he up and quit his lucrative job as partner for DeBevosie & Plimpton and joined the Securities and Exchange Commission as it’s co-head of enforcement. Robert Sacks has remained leading the dirty defense ligation of JP Morgan at banksters favorite law firm Sullivan and Cromwell.

Now here is where this gets even odder. Apparently JP Morgan’s lawyers starting circulating Judge Heitler’s letter around to other law firms that represented the banks. Judge Heitler’s PR man David Bookstaver confirmed today this letter was private and doesn’t have to be filed in the case records because it’s from an administrative judge to the lawyers involved and not from the judge on the case. Lawyers for DLJ Mortgage, a division of Credit Suisse who is also being sued for civil fraud by the NY AG, got a copy of Heitler’s letter and used it in a motion to file for judicial intervention last week. Richard Jacobson of law firm Orrick, was begging the court to give them Judge Kornreich in a billion rmbs suit filed by a trustee for aggrieved investors against Credit Suisse. The rmbs in this case is called Home Equity Asset Trust 2007-1 and was packaged by the traders at Credit Suisse; the trust is being represented by David Abrams, of Kasowitz Benson Torrres & Friedman, who is also helping the FHFA try and recover billions in rmbs fraud. Judge Heitler’s letter being circulated feels like the big bank lawyers were trying to warn each other you’d better get your motions for favored judge in cuz this legal trick is about to get shut down.

Now that some of the early RMBS putback cases are getting decided on it’s becoming clear who favors the banks and who favors the law. That’s why we are seeing big money law firms file all these ‘I have to have this Judge’ motions this year. Judge Kornreich has been ruling in favor of banks on these cases but she has also been getting over turned in appeals court. Judge Bransten has favored the investors who lost billions in RMBS and her decisions are holding up in the appeals court. It’s the wild west of case law being made in these mortgage securities lawsuits and it’s becoming clear who has the balls to make new decisions that will likely cost the banks billions in litigation payouts.

When I first saw the NY AG’s case assigned to Friedman after it was initially slotted to Ramos I thought Ramos had a conflict of interest with one of the lawyers on the case but that idea wasn’t proven. And while we now have some kind of answer from the court about the new judge assigning policy, the timing of the whole judge thing still just seems a little off.

What has become clear is now NO ONE can judge shop any RMBS cases not assigned yet. And you bet big law is about to learn everything they can about one lucky judge Marcy S. Friedman.

Judge Heitler Letter NYAG v. JPM


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  1. Ha! Ha! Ha!
    So the “Banksters” won’t be doing any “judge shopping” for the foreseeable future, eh? Sounds too good to be true.

  2. Hello,

    Look into a new BCCI type bank but this time around, its operational in Brazil.

    The outfit in question is Banco Paulista and its controlled subsidiary broker/dealer SOCOPA.

    This little bank, owned by a very traditional “Paulistano” family (the Vidigal family) has turned itself into the go to bank for money laundering, black market currency, corrupt politicians accounts, etc.

    They are even taking deposits (turned into cash usually within 48 hours) from known terrorist groups, known drug dealers, arms dealers, pirated/contraband goods dealers, etc.

    ± USD 400 Million per month comes from the triple frontier of Brazil/Paraguay/Argentina and into Banco Paulista in São Paulo. From there, they cash this money on a weekly basis and deliver it to the owners “Casas de Câmbio” to keep on moving. The bank is charging between 3% and 5% to cash out moneys and 20% to launder moneys.

    The Bank also charges a 3% flat feet to accept hard cash deposits of any source.

    Now the real deal is the black market currency exchange (known in Brazil as Doleiros).

    The bank uses its license to purchase official US Dollars from the Brazilian Central Bank (to the tune of US$ 10 million per day) therefore at official exchange rates and than sells the  same dollars in the black market (via fraudulent forex contracts). The focal point of distribution for the hard cash (both dollars and reais) is SOCOPA’s main office at Rua Funchal, 129  – 5º floor in São Paulo, Brazil.

    The person in charge of handing the cash over there is Mrs. Maria José

    There are four main “culprits” in this criminal activity:

    Alvaro Augusto Vidigal
    Alvaro Augusto de Freitas Vidigal
    Marcelo Pereira
    Tarcísio Rodrigues

    If one keeps an eye out on any regular day, they will see politicians, businessmen, regular people, criminals, etc., all going into SOCOPA to get their packets of cash.

    The authorities in São Paulo don’t care or at least pretend the issue does not exist and the local media is nowadays almost like in Venezuela (no reports involving politicians).

    If this gets the media it deserves, it has the power to bring down some top figures in the Financial World of Brazil and also some heavyweights from the political arena as well. Let’s not forget known/wanted criminals. 

    This little bank is a true “Atomic Bomb.”

  3. If I were to hazard a guess, no action will be taken against Banco Paulista or SOCOPA. The U.S. corporate criminals and their associates are looking for money laundering outlets that are less known to authorities than the usual offshore venues. And this goes for non-U.S. entities as well.

    Don’t hold your breath waiting for criminal charges against any white collar criminals… especially money launderers.

    I did a search on Banco Paulista but wasn’t able to find any dirt.

    Do you have a link to any relevant information, Enki Ea?

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