On Thursday, a U.S. district court judge refused to reconsider his earlier decision allowing a purported class action to proceed against The Bank of New York Mellon Corporation over its role as trustee to Countrywide Financial Corporation. The pension funds bringing the suit have accused BNY of failing to stem Countrywide’s collapse due to overexposure from mortgage-backed securities.
Judge William Pauley’s 12-page opinion wasn’t a total loss for BNY, though. He certified the question of whether the Trust Indenture Act of 1939 applies to BNY’s alleged actions for interlocutory appeal to the U.S. Court of Appeals for the Second Circuit, giving BNY and other MBS trustees a chance to shoot down the plaintiffs theory of liability under the TIA once and for all.
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