| NEW YORK, Sept 30
NEW YORK, Sept 30 A federal judge has thrown out
FDIC lawsuits against Citigroup Inc, Bank of New York
Mellon Corp and U.S. Bancorp to recoup some of
the more than $695 million that the regulator said it lost by
selling soured mortgage debt once owned by a failed Texas bank.
In a Friday night decision, U.S. District Judge Andrew
Carter in Manhattan said the FDIC, the receiver for Austin-based
Guaranty Bank, lacked standing to sue after selling the debt in
question through a March 2010 resecuritization transaction.
"Any claims that plaintiff might have held, travelled with
the bonds when they were transferred," Carter wrote.
FDIC spokesman David Barr said the regulator, whose full
name is Federal Deposit Insurance Corp, does not discuss pending
It had argued that the right to sue was a "personal" claim
that it did not give away in the resecuritization.
The FDIC had accused the defendant banks of failing, in
their roles as bond trustees, to ensure that mortgages backing
$2.7 billion of securities bought by Guaranty were properly
underwritten, or to require lenders to fix or buy back troubled
According to the lawsuits, the securities were issued from
2005 to 2007, and sponsored by the EMC unit of Bear Stearns Cos
or by a unit of Countrywide Financial Corp.
In 2008, JPMorgan Chase & Co bought Bear, and Bank
of America Corp bought Countrywide.
Guaranty had roughly $13 billion of assets before its August
2009 demise. The FDIC at the time estimated that the bank's
closure would cost its deposit insurance fund $3 billion.
The cases in the U.S. District Court, Southern District of
New York are FDIC v. The Bank of New York Mellon, No. 15-06560;
FDIC v. U.S. Bank NA, No. 15-06570; and FDIC v. Citibank NA, No.
(Reporting by Jonathan Stempel; Editing by Lisa Shumaker)