Assuredvflagstar 10.22transcript

In The Matter Of:
ASSURED GUARANTY MUNICIPAL CORP. v

FLAGSTAR BANK, FSB, et al.,
October 22, 2012
SOUTHERN DISTRICT REPORTERS
500 PEARL STREET
NEW YORK, NY 10007
212 805-0330
Original File CAMRASSF.txt
Min-U-Script® with Word Index
FLAGSTAR BANK, FSB, et al., October 22, 2012
CAMJASS1 Trial Page 721
1 UNITFD STATFS DISTRICT CoURT
SoUTHFRN DISTRICT oF NFW YoRK
2 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~x
3 ASSURFD GUARANTY MUNICIPAL CoRP.
formerly known as Financial
4 Security Assurance, Inc.,
5 Plaintiff,
6 v. 11 Civ. 2375 JSR
7 FLAGSTAR BANK, FSB, et al.,
8 Defendants.
9 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~x
10 october 22, 2012
10:35 a.m.
11
Before:
12
HoN. JFD S. RAKoFF,
13
District Judge
14
15 APPFARANCFS
16
SUSMAN GoDFRFY LLP (NYC)
17 Attorneys for plaintiff
BY: JACoB W. BUCHDAHL, Fsq.
18 ARUN SRINIVAS SUBRAMANIAN, Fsq.
JoSFPH C. PoRTFRA, Fsq.
19 WARRFN T. BURNS, Fsq.
of counsel
20
21 ARNoLD & PoRTFR LLP
Attorneys for defendants
22 BY: VFRoNICA FLLFN RFNDoN, Fsq.
MoNIQUF ANNF GAYLoR, Fsq.
23 STFWART DAVID AARoN, Fsq.
SUSAN L. SHIN, Fsq.
24 of counsel
25
1 (Trial resumes)
2 (In open court)
3 THE COURT: BeIore we turn to the motions and the
4 Daubert question, I think plaintiII's counsel has a Iew
5 depositions snipets you wanted to play?
6 MR. BUCHDAHL: That's correct. We wanted to play a
7 deposition excerpt, excerpt Irom a deposition oI Jean Garrick,
8 a Flagstar corporate representative.
9 THE COURT: Go ahead.
10 MR. AARON: Flagstar objects to the playing oI this
11 excerpt, as we notiIied plaintiII's counsel. This witness is a
12 senior vice president in charge oI underwriting internal
13 control.
14 However, the purpose Ior which they seem to be
15 oIIering this exhibit is to put in evidence Irom a third party
16 Iirm retained to rely in order to check Ior compliance with
17 underwriting guidelines. It was a quality control process and,
18 your Honor, the exhibits that Assured seems to put in are --
19 reIlect exactly what they're trying to do.
20 Mr. Buchdahl, does the Judge have those in Iront oI
21 him?
22 MR. BUCHDAHL: No. I can hand them up.
23 (Pause)
24 MR. AARON: Your Honor, I'll click to the transcript
25 excerpts are a series oI exhibits, the Iirst oI which is
1 PlaintiII's Exhibit 131, which is a good example oI the reason
2 why we're objecting. PlaintiII's Exhibit 131 --
3 THE COURT: Sorry, counsel.
4 MR. AARON: Sure.
5 (Pause)
6 THE COURT: I am there.
7 MR. AARON: PlaintiII's exhibit 131 is a memorandum
8 Irom Marni Scott Dubry and Jean Garrick at Flagstar
9 disseminated to Sharon Shrev December 28th, 2006. What it
10 talks about are 1762 loan Iiles reviewed by Wetzel Trough Ior
11 the second quarter. It talks about loan selection, Judge.
12 What you'll see, it has a breakdown oI how many diIIerent loans
13 that were comprised in the 1762, and the Iirst category oI 1302
14 consists oI conIirming HELOC seconds and SISA, S I S A loans.
15 The problem is those are all co-mingled, so when you
16 look at the Iindings, which is I think the reason why Assured
17 wants to put this is, they're set Iorth in the second paragraph
18 in the percentages. One cannot ascertain Irom this document
19 what number oI these were HELOCs, and more particularly, Judge,
20 what number oI these were HELOCs that were part oI this
21 securitization.
22 The same issue comes in with respect to PlaintiII's
23 Exhibit 132. The same issue comes in with respect to
24 PlaintiII's Exhibit 133. Those three exhibits have that issue,
25 and what you'll see iI your Honor looks through the
1 designations, what Assured's counsel does basically is walks
2 the witness, Ms. Garrick, through these three memoranda.
3 The documents that come thereaIter, and I am talking
4 speciIically about PlaintiII's Exhibit 135 --
5 THE COURT: Let's stop there. I am not sure I
6 understand your objection. I take it, though -- I haven't yet
7 heard the tape -- that the purpose oI this deposition or
8 purpose oI this proIIer is to Iind out what methodology
9 Flagstar Bank used in checking out loans, mortgage loans
10 generally, yes?
11 MR. AARON: I suppose we'll have to hear Irom Mr.
12 Buchdahl about that. My thought in terms oI why they were
13 oIIering it, Judge, was to put in what the percentage was oI
14 the so-called Iindings. For example, on the second paragraph
15 oI PlaintiII's 131 --
16 THE COURT: Let me hear Irom plaintiII's counsel.
17 MR. BUCHDAHL: Your Honor, Flagstar did not do any
18 diligence on the actual loans that it placed into the
19 securitizations. In other words, at the time that it assembled
20 these securitization pools, it did not take any steps to
21 determine whether these 12,000 loans complied with its
22 representations, including that they were issued in conIormance
23 with underwriting guidelines and there was no Iraud.
24 What the testimony was Irom their witnesses, they
25 simply relied on their existing underwriting practices
Min-U-Script® SOUTHERN DISTRICT REPORTERS (1) Pages 721 - 724
1 including their quality control practices. These documents
2 represent what we learned in discovery was the main quality
3 control check. They retained a third party Iirm, the Wetzel
4 Trout Iirm, who would review samples oI loans, and it is true
5 the HELOCs are intermingled.
6 We are not seeking to rely on these percentages Ior
7 anything other than to show just generally that Flagstar was
8 aware there were underwriting issues and there were problems
9 that were being revealed even at or beIore the time oI these
10 securitizations. I think counsel's argument, though well
11 taken, goes to weight and not admissibility.
12 THE COURT: I agree with that. So let's play it.
13 Now, there are markings here --
14 MR. BUCHDAHL: Your Honor, those markings are parts we
15 are going to play.
16 THE COURT: Parts you're going to play? Okay.
17 MR. BUCHDAHL: It should be noted that counsel Ior
18 Flagstar did ask us to play some oI their redirect examination
19 oI this witness which we are also included in this tape,
20 although --
21 THE COURT: How long is this altogether?
22 MR. BUCHDAHL: The whole thing is less than halI an
23 hour, your Honor. We are happy to submit it iI you don't want
24 to take the time in court.
25 THE COURT: I am going to take it on submission, so it
1 is received. Anything else Irom plaintiII's counsel?
2 MR. BUCHDAHL: Your Honor, with that, we close subject
3 to reserving the right to call witnesses in rebuttal.
4 THE COURT: All right. Now let's hear --
5 MS. RENDON: Thank your Honor.
6 I am going to argue the motion to exclude the
7 testimony oI Rebecca Walzak under Federal Rule oI Evidence 702,
8 and my partner Stewart Aaron is going to make motions to
9 exclude the expert testimony oI Joseph Mason and Dr. Lipshutz.
10 I understand what your Honor said, the gist oI that
11 argument is not going to be that he is not a sound
12 statistician, but that the assignment he was given was the
13 wrong project, how he was directed in his undertaking was
14 incorrect.
15 THE COURT: Ms. Walzak is clearly a critical witness,
16 so let's start with that.
17 MS. RENDON: Thank your Honor. I will step right over
18 here to the podium.
19 As I say, Flagstar renews its motion under Federal
20 Rule oI Evidence 702 to exclude the testimony oI Rebecca
21 Walzak. As your Honor knows, Rule 702 states that a witness
22 who is qualiIied as an expert by knowledge, Iield, training or
23 education may testiIy and Iorm an opinion or otherwise iI --
24 and little C states the testimony is the product oI reliable
25 principles and methods, and little D says the expert has
1 reliably applied the principles and methods to the Iacts oI the
2 case.
3 There are at least 7 reasons here why Ms. Walzak
4 should be excluded under this rule. First and Ioremost,
5 Ms. Walzak --
6 THE COURT: Only 7? It must be a slow day.
7 MS. RENDON: I am grouping. There will be subparts to
8 my 7, your Honor. I am trying to be concise.
9 Ms. Walzak is not a neutral expert, your Honor. As
10 your Honor brought out in your own questioning oI the witness,
11 her CV demonstrates she is results-oriented and she is a
12 management person. She is not an objective underwriter who was
13 called in Ior her underwriting experience to give an objective
14 and neutral opinion.
15 THE COURT: However, I think, oI course, all oI my
16 comments are subject to hearing Irom plaintiII's counsel, but I
17 think there is something to that.
18 But to be Irank, I don't see how that distinguishes
19 her Irom every other expert I have ever heard in 17 years on
20 the Bench. The only diIIerence is that they were all proIess
21 to neutrality when their testimony shows they're all
22 result-oriented. They're hired because the party who hires an
23 expert knows Irom past practice usually where that expert is
24 going to come out. In the rare case where the expert seems to
25 be waIIling, they Iire the expert and get a new one. So I
1 agree with you that she is probably result-oriented and that is
2 important in evaluating her testimony, but I don't think it is
3 a per se disqualiIication.
4 MS. RENDON: Your Honor, I do think that in the case
5 oI Ms. Walzak perhaps even more than other experts, we see her
6 trying to be results-oriented, not just on the Iace oI her CV.
7 I also think that the Iact that her opening salvo on
8 her CV is speaking in terms oI management and experience in
9 operations and risk management is a testament to what her
10 expertise actually is compared to what it should be Ior the
11 purposes oI trying to render the testimony she is rendering in
12 this case.
13 In other words, she is a management person. When you
14 look at what her experience is, and this is my number two, she
15 is not a qualiIied expert. When you go back and look at the
16 experience as set Iorth on her CV and as summarized in that
17 opening paragraph oI her CV, what you see is somebody who Ior
18 the past 30 years has Iocused on providing management
19 solutions, looking at things at an operational level, at a risk
20 management level, at cutting budgets, at working with how to
21 cut costs, how to advise at the 70,000 Ioot level. You don't
22 see a loan level underwriter.
23 THE COURT: But she did do that, as she testiIied,
24 over many years. So iI I understand your argument has to be
25 she hasn't done it recently enough to make her knowledgeable
1 and balanced on these things?
2 MS. RENDON: I think that is exactly right, your
3 Honor. The last time Ms. Walzak underwrote a loan was 30 years
4 ago. There have been signiIicant changes in the world oI
5 underwriting. In the time period that is at issue in this
6 case, 2004, 2005, 2006, 2007, there was a big market Ior retail
7 mortgages, and Ms. Walzak, by having no experience in the
8 direct underwriting world during that period oI time, is
9 demonstrating that she is unqualiIied to understand what the
10 industry standards were and how guidelines were being
11 interpreted in that period.
12 In Iact, what we'll see -- and I'll talk a little bit
13 more about this under one oI my other points -- Ms. Walzak, to
14 assist her and her eight underwriters, had to rely upon a
15 survey that she conducted in 2007 which is culled out in her
16 report as the item she talked about as consulting with 20
17 industry experts. The reality is it was a paper survey, but it
18 Iacially demonstrated a lack oI industry standards. By Ms.
19 Walzak not being an underwriter in this period was not a
20 qualiIied period in how to decide how to resolve the
21 non-consensus you see in that survey.
22 THE COURT: I am no not totally clear why industry
23 standards is relevant here. The contract requires adherence to
24 Flagstar's guidelines. Remind me, do we have those in
25 evidence?
1 MS. RENDON: We have them to enter into evidence. I
2 don't believe they were entered into evidence as oI this point,
3 your Honor.
4 THE COURT: That is a possible problem, diIIerent kind
5 oI problem Ior plaintiII. How am I supposed to determine
6 whether there has been adherence or dis-adherence to the
7 guidelines iI I haven't seen the guidelines?
8 II the guidelines are Flagstar's guidelines, what does
9 it matter what the industry guidelines are?
10 MS. RENDON: That is an interesting question that you
11 pose because Rebecca Walzak's testimony -- and its demonstrated
12 in her report -- is replete about a discussion about not just
13 noncompliance with Flagstar guidelines, but noncompliance with
14 what she claims is industry standards. It is Irom day one at
15 issue that I tried to nail down with her, when are you moving
16 Irom guidelines into the world oI industry standards because I
17 don't believe industry standards are relevant here.
18 Yet nonetheless, the only thing that Ms. Walzak
19 testiIied to with any speciIicity that she relied upon to give
20 her guidance and understanding how to approach the underwriting
21 assignment that she and her eight underwriters did here was
22 this deIective survey which purported to speak to industry
23 guidelines. So I think here we see a lot oI the issues in the
24 approach.
25 You didn't hear her discuss or articulate the speciIic
1 guidelines oI Flagstar. You didn't hear her discuss or
2 articulate how the deIects Iell within those guidelines. All
3 you heard was some general discussion oII a chart and a couple
4 oI anecdotal stories about how she thought there was
5 noncompliance. You did not see a robust discussion when you
6 tried to get behind the methodology oI what she did and what
7 she relied upon in getting there.
8 That brings us to our third problem with Ms. Walzak.
9 With all due respect, and this is a phrase Irom the case law,
10 it is not designed to be a disrespectIul statement, she is what
11 case law talks as a basis Ior exclusion a talking head. She
12 hired a group oI people oII oI paper resumes that she has never
13 worked with previously, did not interview personally, and she
14 is parroting their purported Iindings. We see this same issue
15 with her purported Iraud reviewer's Digital Risk.
16 She is taking what they tell her and just relying upon
17 it wholesale without any evidence that she understood the
18 nature oI their work, the quality oI their work. She did not
19 give them written instruction and she did not apparently even
20 understand that they have the loan Iiles available to them
21 until her counsel told her at her deposition in this matter
22 that that was the case.
23 THE COURT: Now, she did, iI I recall correctly,
24 ultimately review each oI the Iiles, yes?
25 MS. RENDON: She claims that, your Honor, and she
1 claimed that Ior the Iirst time in --
2 THE COURT: Credibility can be taken into account in a
3 Daubert hearing but, nevertheless, the only evidence I heard
4 that disputed that was you questioned whether she could have
5 done it in the time she indicated she took to do it. That
6 would perhaps go to how thoroughly she did it. I don't know
7 that that would dispute that she didn't do it.
8 MS. RENDON: We can talk about that point and I will
9 come back to other testimony she gave us.
10 Ms. Walzak clearly --
11 THE COURT: Forgive me Ior interrupting.
12 MS. RENDON: Sorry, your Honor?
13 THE COURT: Assuming that she did, in Iact,
14 meaningIully review each oI the Iiles to conIirm what her
15 people had told her, to conIirm what they had told her.
16 Wouldn't that eliminate the problem that you're raising that
17 she simply blindly relied on their analysis?
18 MS. RENDON: It would not, your Honor.
19 Ms. Walzak in testimony agreed at the very least she
20 relied upon the input she received Irom her group oI eight as
21 well as Digital Risk and in the case oI Clear Capital, she did
22 not even speak with them. She claims to have reviewed Ior the
23 Iirst time the loan Iiles. She never gave that testimony in
24 deposition and, in Iact, testimony that came in in her
25 testimony here today was that the only loan Iiles that she went
1 back and looked at was when she was using her Exhibit B going
2 across that, seeing inconsistencies in the answers oI her
3 reviewer and she'd go back and take a look.
4 But let's say she did give testimony that that said
5 she looked at the 610 loan Iiles. She Iurther testiIied that
6 she would have only done so aIter the Iile review had
7 concluded. She testiIies that that Iile review took the
8 entirety oI the Iour weeks Irom October 15th to November 15th
9 when her Iirst report issued, meaning that there was no time
10 Ior her to do this analysis that I heard Ior the Iirst time in
11 court.
12 And even iI we assume somewhere in there that she
13 Iound, your Honor, 50 hours in that Iour-week period aIter the
14 Iile review is completed and she purportedly went into this
15 analysis stage, to have gone through the 610 loan Iiles, that
16 would have leIt an average oI Iive minutes, less than Iive
17 minutes per loan Iile, and by Ms. Walzak's testimony in this
18 Court room, Iive minutes per loan Iile is not suIIicient to
19 perIorm a meaningIul Iile review.
20 So with that testimony that it is not suIIicient to
21 perIorm a meaningIul Iile review, even iI one were to assume it
22 had occurred in her own analysis, it would not have been
23 suIIicient to have cured the level oI work and to have had the
24 knowledge base to have made the decision she claims to.
25 Let's say she even did that, your Honor.
1 THE COURT: Let me interrupt you again.
2 MS. RENDON: Sure.
3 THE COURT: Let's assume Ior the sake oI argument that
4 she delegated all meaningIul Iile review to these Iirms without
5 any particular instructions other than do your thing, so to
6 speak, but that they did an acceptable job? Would she then not
7 be able to rely on it?
8 MS. RENDON: No, your Honor, I don't believe so
9 because actually I don't think we would know iI it was an
10 acceptable job or not. She doesn't know it. She can't testiIy
11 to it. She has eIIectively at that point, your Honor, trying
12 to get in -- and this comes back to the talking head concept,
13 and there is case law cited in our motion Ior this -- she has
14 eIIectively trying to rely wholesale on the actual testimony oI
15 unqualiIied, unknown individuals who have not demonstrated that
16 they've done a proper job or that they're even qualiIied to
17 have perIormed that job.
18 THE COURT: I must say, by the way, as an aside, I
19 have never actually encountered an opinion, although I am sure
20 there are such, reIerring to experts as talking heads. I have
21 heard many an attorney describe a judge in those terms, but
22 usually oII the record.
23 MS. RENDON: We are certainly not speaking oI your
24 Honor. Your Honor, I think also whether it was Ms. Walzak, her
25 eight reviewers, Digital Risk or Clear Capital with whom she
1 never even bothered to speak in connection with this
2 engagement, Ms. Walzak here in this courtroom has never
3 articulated how she deIined material and what it means to
4 materially raise the risk proIile oI the loan.
5 What she talks about vaguely was --
6 THE COURT: It is deIined in my opinion.
7 MS. RENDON: It is, your Honor, but then beyond saying
8 it materially raised the risk proIile, when one is to ask
9 Ms. Walzak what does that mean when you perIormed a loan Iile
10 review, how did you actually bring that concept, that principle
11 oI materially raising risk on a loan, on a loan into how do we
12 apply that to the Iacts here? How do we apply that to these
13 loan Iiles?
14 We did not hear her articulate any meaningIul basis
15 Ior that, and that is true whether it is her, her eight
16 reviewers, Digital Risk or Clear Capital. In Iact, she
17 testiIied she didn't even attempt in connection with her loan
18 Iile review Ior herselI or Ior anybody else to deliniate what
19 that meant.
20 What eIIectively she said is whether it is her or her
21 reviewers or Digital Risk or Clear Capital, she articulated a,
22 "I know it when I see it-type basis." That is not a reliable,
23 principled method that meets the Daubert standard that we can
24 go back and say can be veriIied or is acceptable within the
25 scientiIic or general more broader community.
1 THE COURT: Just to get one thing out oI the way, I
2 don't think she purported to meet the standards or to even
3 attempted to meet the standards oI a scientist. She is, Ior
4 lack oI better term, Kumho Tire rather than Daubert.
5 MS. RENDON: I understand. I should speak in terms oI
6 that. Either way, what I am talking about approach, the know
7 it when I see it approach under either Daubert or Kumho Tire
8 would not be acceptable Ior her purposes oI saying that meets
9 the standard oI appropriate expert testimony.
10 What she actually testiIied to, it was that she
11 conceded that there are variations in guidelines that would not
12 necessarily result in material increase in risk. She said it
13 is a question oI severity. She said each loan Iile is unique
14 and tells its own story, and she said whether materiality
15 exists or doesn't is just a question oI underwriter discretion.
16 Under questions by your Honor, when your Honor asked
17 her a series oI questions, she could not identiIy a single
18 issue that on the Iace oI the Iile demonstrated a material
19 increase in the risk proIile. She did ultimately claim in one
20 sentence that she thought such issues were present without any
21 explanation as to what that meant, but she could not under
22 questioning by your Honor identiIy what proportion oI the loan
23 Iiles purportedly had such an issue.
24 She has Iacially Iailed to identiIy Ior the court or
25 Ior anybody else what standards she is operating on or how she
1 is coming to her decisions.
2 THE COURT: Let me ask you a diIIerent question on
3 materiality. II a person seeking a mortgage misstates his or
4 her income, why isn't that material on its Iace, so to speak?
5 MS. RENDON: Because, your Honor, there are all levels
6 oI misstating income. In Iact, Ms. Walzak in her deposition
7 articulated this. There is more serious versions oI that and
8 less serious versions oI that. There is an innocent
9 misstatement. Your Honor talked about in questioning oI
10 Ms. Walzak, there is misstating by a little bit. There is
11 misstating by a lot oI bit. There is intentional versions oI
12 that. There are non-intentional versions oI that, and more
13 importantly, your Honor, there is also what is acceptable prooI
14 oI a misstatement. Here what we have is a Iailure in the Iirst
15 bucket to --
16 THE COURT: Wasn't the methodology as it came out --
17 well, I am sorry. Go ahead. Part oI the methodology was, to
18 use this let's call it Salary dot com or something like that?
19 MS. RENDON: Yes, Salary dot com.
20 THE COURT: Presumably that doesn't include judges'
21 salary because they would be involved in the use oI a
22 microscope. II the salary given was at a level that only 10
23 percent I think it was would have reached, or something like
24 that, because it is the other side oI the 90 percent cutoII, we
25 can talk about whether that is good methodology or bad
1 methodology, but isn't that a consistent methodology Ior
2 addressing materiality?
3 MS. RENDON: To the extent that they were using Salary
4 dot com, I guess you might say it showed a consistency in
5 approach oI testing income. I will tell you it is an
6 inherently unreliable approach, your Honor, Ior the reasons
7 why --
8 THE COURT: We'll get to that.
9 MS. RENDON: So on income, you might see now we are
10 talking about Digital Risk. Let's be clear. We have moved
11 Irom the world oI the underwriters who are operating with no
12 guidelines or any delineation as to how to approach their
13 underwriting, we have Ms. Walzak not articulating what's she
14 considered material underwriting errors, and now we have moved
15 into the world oI purported Iraud review oI Digital Risk.
16 THE COURT: You're right. Let's go back a second.
17 Although again I haven't seen the guidelines, I
18 thought I picked up Irom the testimony -- correct me iI I am
19 wrong -- that these were so-called stated income mortgages in
20 the sense that no one who -- it was the practice to not check
21 the income by asking Ior tax returns or pay stubs or checking
22 with the employer, et cetera. Am I right about that?
23 MS. RENDON: You're incorrect, your Honor, I don't
24 think Ior any Iault oI your Honor. This just goes to the
25 truncated presentation.
1 THE COURT: It wouldn't be the Iirst time!
2 MS. RENDON: First oI all, while Ms. Walzak seems to
3 be under the belieI that all the loans in this case are
4 composed oI stated income, in Iact, it was only 40 percent
5 stated income portIolio. She does not seem to be aware oI that
6 Iact, but that is demonstratively true oI the oIIering
7 memorandum in this case. There was a whole bunch oI veriIied
8 income loans Ms. Walzak doesn't seem to be aware oI.
9 THE COURT: I presume that comes out in your case iI
10 we get to your case, right?
11 MS. RENDON: That's correct. We can put it in through
12 the Iace oI the oIIering documents which are designated.
13 THE COURT: What about the stated income?
14 MS. RENDON: Stated income, what you have is while the
15 borrower does stated income, what you did hear testimony oI,
16 although only on a truncated level, was in the Flagstar
17 underwriting guidelines and this also was in the protocol I put
18 into evidence that Ms. Walzak used. In Iact, Flagstar would
19 get a stated income loan Irom Mr. Aaron, but they would do
20 their own levels oI veriIication oI income and reasonableness
21 oI income in their underwriting process.
22 So while the borrower only had to state in the actual
23 guidelines, Flagstar would then be required to do their own
24 levels oI employing their underwriting discretion and taking
25 methods to determine themselves what they thought was
1 reasonable or unreasonable.
2 THE COURT: But in practice did they, in Iact, ask Ior
3 pay stubs or income tax returns or anything like that?
4 MS. RENDON: They did do various exercises, your
5 Honor. I am not sure I could get you to the speciIic grid as
6 to which product required.
7 As you see when the underwriting guidelines come in,
8 they're about this thick Ior diIIerent stated income products,
9 yes. They would be running things like Lexis-Nexis. There
10 would be actual realtime reIerrals to Salary dot com, current
11 time to current time basis.
12 There would be requests sometimes Ior income tax
13 statements. There would be doing Ior selI-employed borrowers,
14 not just surIace on Lexis-Nexis, but going into their money
15 laundering database and looking Ior a whole bunch oI
16 inIormation about the borrower and where they're employed and
17 what their likely to make in that particular area. There was
18 resources that went down to go down into the state level, not
19 catching it just at the Lexis-Nexis, but going into the state
20 business division and corporate Iilings at the state level
21 through state databases.
22 There was a lot oI work that was done. In Iact, some
23 oI the issues that you'll see when Ms. Walzak's work is
24 dissected is there sometimes is a misunderstanding oI what
25 guidelines are applicable. I brought in one case in the
1 income, your Honor, where Digital Risk ran one oI their
2 electronic databases and apparently ignored evidence in the
3 Iile as to borrower veriIication.
4 MR. BUCHDAHL: Objection.
5 MS. RENDON: All this demonstrates this kind oI, I'll
6 just say it as a lay person would, a messy approach, an
7 approach where there were no internal controls or quality
8 control over the process. There was not even awareness oI the
9 nature oI the loans. There was no control over the reviewers
10 themselves, over the Iraud reviewers and there wasn't even an
11 attempt to speak to the Iolks who are running the appraisal
12 review.
13 Ms. Walzak was getting inundated through this process
14 with inIormation she claims at this late date to have gone
15 through all the Iiles and at best she'd have Iive minutes per
16 Iile to have done so. She can't articulate a materiality
17 standard. She can't articulate to your Honor what is Iacial
18 issues and what we hear on direct is nothing more than seeing
19 charts where she says yes, I think that's my categories, those
20 are all the deIects, and we see even see it through my
21 questioning there is redundancy and double-counting going on in
22 those charts.
23 What we see as Iar as the work oI Digital Risk is not
24 just the Iact that they were using non-historic salary web
25 sites to test income, but that electronic exercise, which was
1 an interesting exercise, your Honor, I have never done anything
2 like that beIore, what that electronic exercise also
3 demonstrated was that when you look at the Digital Risk Iiles,
4 they oIten don't include, even iI Ms. Walzak were to have
5 reviewed that, what inIormation they input.
6 It doesn't show you what they put in Ior their
7 particular inputs. It is mass. You just get the output oI
8 something that tells you two data points, but to get to that
9 point we saw that live, you would have had to have answered a
10 bunch oI questions. That is mass. That is not in their Iile.
11 Ms. Walzak agreed with me she had no idea what Digital
12 Risk input or didn't input in each one oI those Iiles, yet she
13 takes an output that purports to say on today's Salary dot com
14 database a borrower oI that proIile, but we have no idea what
15 proIile was entered wouldn't have made that much money.
16 II they go and take that and recalculate DTI and claim
17 borrower Iraud and they claimed missing red Ilags and each one
18 oI these things go down as diIIerent categories oI deIects in
19 Ms. Walzak's Iinding --
20 THE COURT: I am going to interrupt you only because I
21 know we have considerably more oI your attack to cover, but I
22 think it would be helpIul to the court to hear what plaintiII
23 has to say about what you said so Iar.
24 MS. RENDON: I have one last point to make, your
25 Honor. At Clear Capital it is even more egregious on the
1 valuations than just saying she never even wrote to them. I
2 walked through a series oI Fannie Mae discussion points about
3 the reliability oI using an automated valuation model today to
4 try to test the veracity oI appraisals historically done. Ms.
5 Walzak agreed with me that an ABM is only as good as the data
6 upon which it is drawn Irom, what public records is it
7 accessing.
8 What is the depth and breadth oI those records? Can
9 she actually generate? She agreed with me she was unIamiliar
10 with what the records were that that model was accessing. It
11 is yet another demonstration oI a sloppy process, your Honor.
12 Thank you.
13 THE COURT: All right. Let's hear Irom plaintiII's
14 counsel and go back Ior the other points that deIense counts.
15 MR. BUCHDAHL: I'll take them in order, your Honor.
16 With regard to the resume and whether this is a
17 neutral witness, this is a resume designed in her consulting
18 proIession to be hired by banks to help them minimize problems
19 with bad loans. It is results-oriented, the results trying to
20 alternatively minimize deIective loans being underwritten. It
21 does not apply to work she was doing here.
22 THE COURT: It was reIlective oI something that may
23 not go to admissibility, but it may, I will red Ilag it Ior
24 you. First, it did not in any sense exude the sense oI
25 proIessional restraint that one would expect in an expert, even
1 an expert who is result-oriented. This was consistent with the
2 way she answered a huge number oI questions, many oI them put
3 by you, which was "absolutely." That was her term.
4 Now, I understand diIIerent people have diIIerent
5 manners oI speech, but there is an extraordinarily little in
6 this world that is absolutely X or Y, but then the need to make
7 reIinements seemed to not be part oI her usual approach.
8 So that was oI some concern to the court.
9 MR. BUCHDAHL: In terms oI that speciIically, I think
10 in some ways -- look, this entire question goes to the
11 reliability oI her methods. What we have seen here is that
12 deIendants are attacking the process because they can't attack
13 the results because what was striking about the
14 cross-examination is that they did not attempt to challenge a
15 single one oI her opinions.
16 Just to be clear about what her opinions were, her
17 opinions weren't about whether there was Iraud and her opinion
18 wasn't about whether the underwriting guidelines were violated.
19 Her opinions were more nuanced than that. They were did the
20 breaches oI the reps and warranties -- and there were two we
21 Iocused on -- did those breaches materially increase the risk.
22 The place where the court can see just how careIully
23 this witness approached that question is in the Iour loans that
24 she withdrew Irom her Iindings in-between her deposition and
25 now when she testiIied she went back through each one oI these
1 loans to again be conIident that there was a material increase
2 in risk. What we saw in those Iour loans, again brought out by
3 deIendants, in one oI them the ABM, when they went back -- and,
4 counsel, let me just digress Ior one moment to talk about Clear
5 Capital and ABM. She didn't talk to Clear Capital and ABM, and
6 essentially all Digital Risk did was act as goIers to provide
7 her with additional data.
8 Because oI the methods she used is ultimately the
9 method any underwriter uses, it is the methods Flagstar's
10 underwriting guidelines dictate to an underwriter, under that
11 Flagstar's underwriting guidelines they use Salary dot com.
12 Flagstar's underwriting guidelines say use ABM.
13 THE COURT: How do I know all oI this when you haven't
14 given me the guidelines?
15 MR. BUCHDAHL: Because the witness testiIied to the
16 presence oI all the things in the guidelines. She testiIied
17 extensively what those guidelines say, how they have rules Ior
18 DTI and what they are, rules Ior assets and what they are,
19 rules Ior CLTV and what they are. She testiIied at length how
20 the guidelines addressed the various risk Iactors. She wasn't
21 cross-examined on any oI those. I would be happy to put in the
22 guidelines on a portion oI those.
23 THE COURT: Your case is closed.
24 MR. BUCHDAHL: That is true. The testimony in
25 evidence is unchallenged.
1 THE COURT: Now this goes to a diIIerent point, but I
2 might as well Ilag it while it is on my mind.
3 This is a case in which you claim that Flagstar not
4 only materially but repeatedly and across the board to a very
5 high percentage violated their guidelines in representations
6 and warranties in connection with HELOC loans and HELOC
7 mortgages. Isn't an essential element oI that claim:
8 First, to present the court with the guidelines. Her
9 testimony is not the best evidence oI the guidelines. The
10 guidelines are the best evidence oI the guidelines;
11 Second, to the extent that she relies on work oI
12 Digital -- and what was the other company?
13 MR. BUCHDAHL: Clear Capital, your Honor.
14 THE COURT: Clear Capital? Thank you. We haven't
15 heard a single witness on the plaintiII's case Irom either
16 Digital or Clear Capital, have we?
17 MR. BUCHDAHL: No, we have not.
18 THE COURT: So my point is, and this may go to the
19 admissibility oI her testimony under 702 or otherwise, but it
20 also may be a problem Ior you generally is that I'm being asked
21 to let this case go Iorward and ultimately to decide on the
22 liability oI the deIendant at least in part, on what is the
23 testimony oI an expert as to what in substantial measure was
24 not presented directly to the court, but it was only presented
25 through the hearsay she was permitted to present. An expert
1 can present hearsay, but it is troubling to me that where we
2 are getting so much indirect assertions and so little direct.
3 Go ahead.
4 MR. BUCHDAHL: On that point, your Honor, as you
5 noted, she is certainly permitted to testiIy about hearsay and
6 particularly where she used her own judgment and expertise to
7 not simply just repeat the hearsay, but make a conclusion Irom
8 it.
9 Again, your Honor, we heard Iindings based on the
10 Iacts gathered by Digital Risk, right. Essentially Digital
11 Risk, she testiIied, they would punch in a social security
12 number and print out what it revealed about their existing
13 debts or their credit check. They would send it to her, or in
14 the case oI Clear Capital, they would perIorm an ABM. They
15 would print out and send it to her. DeIendants have all that
16 inIormation. Again the reason why we met our burden oI showing
17 these things by a preponderance oI the evidence is:
18 First, because oI the unquestionable breadth oI these
19 representations; and
20 Second, iI any oI them had been wrong, iI any oI her
21 conclusions about a loan had been wrong, we would have heard
22 Irom deIense counsel to challenge her on that.
23 THE COURT: I will say something which I will raise
24 Ior deIense counsel to respond to. You will recall I took a
25 look at one oI the Iiles really at random because I asked
1 originally Ior a diIIerent Iile, and I got that one. The Iile
2 I think on its Iace evidenced Iraud. Indeed, it was kind oI
3 shocking to me because it was Iraud by a policeman in Michigan
4 who apparently was happy to buy himselI a small mansion, by
5 representing that he was not a policeman, but rather the
6 president oI a purported Iinancial company.
7 To Ms. Walzak's credit, despite all evidence, indicia
8 oI Iraud that the court saw just Irom the very quick review oI
9 the Iile, she was much more careIul in saying in what respects
10 it Iailed to meet the guidelines. So I do think to that extent
11 she was put to the test here in open court and passed the test
12 on that Iile. So I raise that really not Ior you, but Ior your
13 adversary when she comes back.
14 MR. BUCHDAHL: II may may address that particular
15 Iile, I want to hand it up to you because the Iile you showed
16 her was a heavily redacted copy oI this, and one oI the
17 questions your Honor had about this was why didn't Digital Risk
18 simply call up this company to see iI it existed.
19 You will see the address given oI the borrower Ior his
20 current employment is Regional Financial Group, 250104 Groton,
21 Dearborn. I want to direct your attention to the last page oI
22 this where it shows the name and address oI the interviewer
23 and, in other words, this is the person who agreed to give the
24 borrower the loan and you can see what Regional Financial Group
25 is. It's the institution that issued the loan. So there
1 wasn't actually any question that it existed because it was
2 serving as a mortgage broker Ior Flagstar.
3 The reason I bring this to your attention is because
4 this didn't come out --
5 THE COURT: So this makes it even worse. So you're
6 saying -- you recall, with counsel's permission, I went on the
7 web and we Iound there was such a company was Regional
8 Financial Group, although we couldn't locate this particular
9 branch. What you're now saying is -- well, I am not sure where
10 you're getting this Irom. Where do you see it?
11 MR. BUCHDAHL: The last box on the third page, it says
12 to be completed by interviewer. It says this application was
13 taken --
14 THE COURT: Yes, yes, yes, yes, okay, right.
15 MR. BUCHDAHL: Your Honor, one other thing about
16 this --
17 THE COURT: So it turns out -- wow. The statute oI
18 limitations hadn't run, I wonder whether there is a good Iraud
19 case here against both the interviewer and the interviewee.
20 Maybe that is too harsh.
21 MR. BUCHDAHL: Your Honor, just in terms oI
22 methodology, it was pretty simple what Ms. Walzak did. She
23 had, as counsel pointed out, about six weeks to really complete
24 this process. It was a very small amount oI time. They
25 started their cross by saying she worked hundreds oI hours and
1 got paid all oI this money, and then their attention Iocused
2 she didn't spend enough time on it.
3 Really, I just want to say this idea that this 50
4 hours was somehow what the witness stated she spent on this,
5 that is not how the testimony came in. The question that was
6 posed was iI you had 50 hours, would that have been enough
7 time? The witness said Iive minutes on a Iile is not enough
8 time. The witness didn't say that is all I spent. The witness
9 didn't say I spent 50 hours. That was a hypothetical by
10 counsel.
11 Going back to the methodology, essentially she had
12 underwriters who would Ilag problems; in other words, they
13 would say debt was too high in proportion to income or we have
14 looked at the income and it appears to be unreasonable, or the
15 CLTV ratio exceeds what Flagstar's guidelines were, and they
16 would send this back to Ms. Walzak and say here are the
17 problems we Iound.
18 Digital Risk in some ways did less analysis. Digital
19 Risk gathered data, here is what we Iound about this borrower
20 you should also consider.
21 That is why in terms oI whether this is suIIicient to
22 prove Iraud? No, as Ms. Walzak testiIied, she doesn't need to.
23 Your Honor asked deIense counsel a question. II they misstate
24 their income, shouldn't that on the Iace oI it breach this
25 representation? You asked a very similar question to
1 Ms. Walzak, and she said well, not necessarily. I think again
2 that showed the careIul nature oI her approach.
3 (Continued on next page)
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Camrass2 Page 752
1 Here's why. She pointed out that the guideline covers
2 errors or omissions or negligence or Iraud. The representation
3 made by Flagstar there would be none oI the above. Those are
4 all very diIIerent things. And a small misstatement oI income,
5 you couldn't say Ior sure that was Iraud, you couldn't say Ior
6 sure it was negligence.
7 That's why, when it came to income, the approach was
8 iI this greatly exceeded the 90th percentile on Salary.com or a
9 similar engine or, when available, Bureau oI Labor Statistics,
10 which does have historical data, iI it so exceeded the 90th
11 percentile that it raised a red Ilag, we would go back and
12 recalculate DTI.
13 Counsel says that there were redundancies in the
14 problems she identiIied. Sure there are. Most oI these Iiles
15 had multiple problems in them. This one we are looking at
16 right here has multiple problems in it. That is not a weakness
17 oI her approach, that is a strength oI her approach.
18 Again, they had the Digital Risk Iiles Ior a year.
19 Here is what we heard about on cross. Four PayScale.com
20 printouts in their view could result in a diIIerent number iI
21 you did it in 2012 instead oI a year ago. The Court had
22 already identiIied that as a weakness oI that approach, and
23 that goes to weight, not admissibility. Right?
24 THE COURT: She did say, as your adversary just
25 pointed out, that in order to determine materiality, you have
Camrass2 Page 753
1 to look at the Iile as a whole. That may be true, in Iact it
2 has a certain common-sense appeal, but it does cast some doubt
3 on whether this lends itselI to an expert's opinion.
4 The notion is that it is highly subjective. II it's
5 highly subjective, how can it be the subject oI a consistent
6 methodology, which is a presupposition oI expert opinion as
7 opposed to nonexpert opinion? What about that?
8 MR. BUCHDAHL: RespectIully, your Honor, I don't
9 believe it is a subjective exercise. Here's why. Many oI the
10 underwriting rules are objective rules, a ratio oI DTI, a ratio
11 oI CLTV. Certainly iI there is an undisclosed debt, that
12 objectively exists.
13 The materiality question as your Honor deIined it is,
14 is it something that would have inIluenced Assured's view in
15 going into this? That's why our approach on direct examination
16 was to say here are the types oI problems we identiIied, here
17 are the occurrence oI those problems, and the whole spreadsheet
18 is in evidence.
19 THE COURT: I can't remember whether your Iirst
20 witness gave any testimony to this eIIect. II it's a subject
21 oI each individual Iile, don't you need someone Irom Assured
22 who would say, iI we had known that on Iile X, we would not
23 have entered into it, iI we had known that on Iile Y, we would
24 not have entered into it, as opposed to saying iI I had known
25 what your expert says, we would not have entered into it?
Camrass2 Page 754
1 MR. BUCHDAHL: Your Honor, I believe the testimony was
2 iI I had known these representations and warranties -- the
3 testimony was these representations and warranties were a
4 critically important part. Here's why. Each one oI those, as
5 our witness explained, goes directly to risk, each one oI these
6 representations. As Ms. Walzak explained, iI you have too high
7 a DTI ratio, it makes a loan riskier. Too low a credit score,
8 a FICO score, makes the loan riskier. II the CLTV is too high,
9 and this is the point deIendants want to say is the most
10 important point, it makes the loan riskier.
11 I think the evidence in the record establishes that
12 these guide lines by themselves served to control risk. When
13 they are breached in the bad direction, which is all the ones
14 that we Iocused on here, the Court can conclude, simply based
15 on the existence oI these guidelines and the substantial amount
16 by which they were breached, that they did increase the risk.
17 So I don't think it is subjective to the extent that an Assured
18 witness has to go through loan by loan.
19 Look, our whole entire approach here is based on the
20 Iact that this is a sample and Irom this sample and the huge
21 problems we see here we can conclude that throughout the 12,000
22 loans there are abundant problems here. While each loan tells
23 its own story, I think there is a very clear story that emerges
24 oI lack oI attention to the most basic principles oI
25 underwriting in terms oI what was going on at Flagstar.
Camrass2 Page 755
1 You would see time and time again the same problems.
2 They would blink at the same issues: Overstated income,
3 undisclosed debts, multiple credit inquiries that did not have
4 the required letter oI explanation, and other kinds oI problems
5 that Ms. Walzak identiIied.
6 So, Ms. Walzak, think about the scope oI her
7 testimony, cross and direct, over the course oI a week.
8 THE COURT: I remember.
9 MR. BUCHDAHL: We put approximately 20 loans into
10 evidence, 20 speciIic loans where Ms. Walzak testiIied about
11 her precise Iinding. She went unchallenged on any oI those
12 loans. She was not asked a single question about any oI those
13 loans on cross-examination. The reason Ior that is she can't
14 be challenged. The breaches were so bad, it's totally obvious.
15 She was then asked about the Iour loans on the bubble.
16 By "the bubble" I mean, she used the word "cusp." These are
17 the ones that at Iirst blush she said I think these do
18 materially increase risk. But when it came to appear in court
19 and stand behind the Iindings, she said, I'm going to take
20 these Iour back.
21 Problems, yes, but not so bad. An example oI one oI
22 them was the AVM. The appraisal in the Iile said $140,000, and
23 her AVM that Digital Risk had done, Clear Capital had done,
24 said $120,000. That is a substantial diIIerence, almost 15
25 percent. But Ms. Walzak said, look, I'm not going to say this
Camrass2 Page 756
1 materially increases the risk, recognizing essentially that
2 there is a bluntness to some oI these instruments.
3 she was questioned about those Iour loans. You saw
4 some oI them. I think one oI them had a DTI that went up to
5 into the 50s. Most problems she testiIied to on direct were
6 where DTI had soared into the 80s or over 100 percent or closer
7 to 200 percent. That was the second group oI loans.
8 The Iirst group oI loans was the one I reviewed on
9 direct. The second one were these ones on the cusp that showed
10 kind oI where her margin was. That I think should give the
11 Court all the comIort it needs to say she wasn't simply
12 throwing a loan out and saying this is a breach iI there was
13 any kind oI problem.
14 She looked at those loans, they did have problems,
15 they did certainly not meet underwriting guidelines in various
16 respects, but she wasn't willing to say materiality. So, when
17 counsel said that Ms. Walzak never deIined materiality, you can
18 see it in the results.
19 There is a third group oI loans. Counsel did pick out
20 Iour or Iive loans to try to challenge her Iindings on and say
21 here is where you made a mistake. They could have done that
22 with 600 loans, but the Iact is they can't, because the
23 Iindings are good, your Honor. So they picked Iour.
24 They didn't challenge a single AVM, to say look at
25 these comps, these are terrible comparative properties. They
Camrass2 Page 757
1 didn't challenge a single unclosed debt to say you claim this
2 was this person's debt, but look, the document shows it belongs
3 to someone else. They didn't challenge all kinds oI issues.
4 They challenged one, PayScale.com. Again, they
5 demonstrated that you can't get a diIIerent result in 2012.
6 But look at the loans they chose. This is one oI them. This
7 is one oI them. This is one oI the loans deIense counsel
8 selected to say you can't rely on her methodology because the
9 PayScale.com came back diIIerent.
10 What do we see here? In your Honor's words, blatant
11 Iraud on the Iace oI the Iile. II you look at the other
12 examples they used, those, too, had undisclosed debts: A
13 quarter oI a million dollars on another property, a thousand
14 dollars a month.
15 These were not good loans, your Honor. The reps were
16 exceedingly broad. The reason we are getting this very
17 sustained attack on the process is because the results can't be
18 challenged.
19 THE COURT: Let me hear Irom deIense counsel.
20 MS. RENDON: Thank you, your Honor. II only Mr.
21 Buchdahl could have been the testiIying expert, because he is
22 testiIying a lot more cleanly than anything we heard come out
23 oI Ms. Walzak's mouth. In reality, the representations and
24 warranties, there are 2 oI them, your Honor. There is a list
25 oI 72, but there are 2 that we are really talking about here.
Camrass2 Page 758
1 One is that there is a purported material noncom-
2 pliance with Flagstar's underwriting guidelines. As your Honor
3 correctly points out, the best evidence oI that is by actually
4 putting in the underwriting guidelines and having Ms. Walzak
5 walk us cleanly through: Here is the underwriting guideline,
6 here is what was wrong with it, and here is why that is
7 material increase in risk proIile. We didn't hear that.
8 We heard 20 loans come in, anecdotal type stuII that
9 it is a soup, that each loan Iile is unique, and then a kind oI
10 yes, absolutely there is material breach on this. When you try
11 to break that down and understand what is behind that, what is
12 the principle, Ms. Walzak, that you are operating on in coming
13 to that decision and making that determination, you don't hear
14 anything.
15 Your Honor, what you were showed when you requested
16 loan Iiles, you got a loan Iile handed to you. It had a credit
17 report in there that your Honor questioned the witness about.
18 You, I think, were looking Ior clean lines. I don't want to be
19 presumptuous, this is my inIerence, but you, I think, looking
20 Ior some nice clean lines on how a law clerk or somebody else
21 could understand what is a Iacial deIiciency in a loan Iile,
22 said, as I look at this credit report, it shows some derogatory
23 credit on here, can I say that that is Iacially a material
24 breach oI the underwriting guidelines?
25 Ms. Walzak said, I don't know, I need to look at the
Camrass2 Page 759
1 whole loan Iile. She was given the lunch break to go and take
2 a look at that loan Iile. What did she come back and tell your
3 Honor? No, your Honor, you can't use this as a basis to say
4 there is a clean cut breach oI underwriting. Why is that?
5 THE COURT: Because it was a something perIormed at a
6 later date.
7 MS. RENDON: Right. What she also said when you were
8 Iirst questioning her is because there are compensating
9 Iactors, your Honor, you can't just take a derogatory credit
10 report. You have to look at what assets does this borrower
11 have, what types oI reserves do they have, what is their level
12 oI income.
13 It's a soup, an underwriter discretion. She couldn't
14 answer nice clean lines about there is an underwriting
15 guideline here, it's been violated, and that led to something
16 else. We did not hear that testimony. What we heard was
17 anecdotal stuII coming Irom Ms. Walzak.
18 It's true that while I decided not to go in and take
19 testimony on each individual loan Iile, what I did see and
20 attack was the process. So how do we get there? How can I
21 draw some nice clean lines? What did I do?
22 I took the Iour loan Iiles that she withdrew. I asked
23 her, what's the principle underlying why these loans were
24 withdrawn? Do you know what I got at Iirst? Testimony that
25 explained to me why these loan Iiles had material breach. To
Camrass2 Page 760
1 which I said, Ms. Walzak, do you understand you withdrew these
2 loans? Then she said, oh, yeah.
3 I asked her what were the principles. I should be
4 clear. OI the Iour loans, your Honor, three oI them were
5 Digital Risk Iiles. Three oI them involved purported Iindings
6 oI Iraud. Take a look at the comments that we put in on those
7 Iraud Iiles. There is strong language in those comments: This
8 is borrower misrepresentation, it is material, it represents a
9 deviation Irom the underwriting guidelines.
10 I asked Ms. Walzak, what's unique about these? Why
11 did you take these three Digital Risk back? Why didn't they
12 meet the mark? The answer I got: She only withdrew loan
13 Iiles, she couldn't remember the loan Iiles. She couldn't
14 recall why that Digital Risk Iinding was a poor one.
15 When I said, can I use that guideline, to go back to
16 what Mr. Buchdahl is testiIying, can I use that principle that
17 iI I see an income gap oI this versus that, can I take that and
18 apply that to the balance oI the loans as a nonmaterial income
19 diIIerential? No, I can't say that, I just don't recall this
20 loan Iile. That's what I heard.
21 Then I talked about the Clear Capital. One oI the
22 Iour was a Clear Capital. There was an AVM issue in there. I
23 said, what was wrong with the AVM, how come you didn't catch
24 these on their Iirst time out? Again I can't remember. Only
25 Iour loan Iiles, but I can't remember why I withdrew these.
Camrass2 Page 761
1 So we didn't get satisIying testimony. We didn't get
2 any clear objective guidelines. We didn't hear any discussion
3 about why these were any diIIerent than all the other Digital
4 Risk Iiles that she looked at. And it leads to a complete lack
5 oI conIidence.
6 Ms. Walzak sitting up there can't testiIy. She just
7 doesn't know why Digital Risk came to a decision on one loan
8 versus why they came to a decision on a diIIerent loan. She is
9 relying upon hearsay. She is relying upon what people are
10 telling her. She has no personal knowledge or ability to sit
11 here and articulate clear principles on which we can operate
12 under that are relying and can be applied to the portIolio.
13 It is particularly scary that that is the case here.
14 We are being asked to extrapolate liability, your Honor, Irom
15 this sample all the way out into the world oI thousands oI loan
16 Iiles. We are supposed to rely upon this approach as though it
17 is valid across 16,000 loan Iiles and be thinking about paying
18 over a hundred million dollars based upon this testimony, when
19 it boils down to nothing more than an unarticulated principle
20 oI I-know-it-when-I-see-it: I think Digital Risk got it right
21 here, and I'm sure they did, absolutely they did, but I can't
22 tell you why they got it wrong in the Iour that I withdrew.
23 Also, and I want to make sure to cover this point, we
24 did not just see the issue with the PayScale.com, your Honor.
25 It goes to the impeachment. When your Honor talked about being
Camrass2 Page 762
1 troubled by only have indirect testimony here, I want to be
2 clear, that exercise we did with PayScale.com not only
3 demonstrated the likely issue with the historic gap in picking
4 90th today Irom what 90th might have been yesterday.
5 It also, under Ms. Walzak's direction as to what were
6 the proper inputs oII oI what we saw oI the inIormation in the
7 loan Iile, demonstrated Digital Risk had made mistakes. They
8 had input that someone only had 3 years oI prior experience in
9 a proIession instead oI what the actual loan Iile that Ms.
10 Walzak said should have been the proper input was actually 10
11 years.
12 When you input the 10 years and then skipped past a
13 bunch oI screens that Ms. Walzak had no idea what Digital Risk
14 input or didn't input, because she had no control over their
15 process, it generated a much higher number. What that shows is
16 an unreliability, a scare Iactor, in relying upon Digital Risk
17 and their Iraud Iindings. When you see mistakes in this arena,
18 you have to query about mistakes in other arenas. You also
19 have to say, did we hear clear articulation by Ms. Walzak oI a
20 guideline being breached that led to something else?
21 Ms. Walzak, in the area oI undisclosed debt, Ireely
22 admitted that they were counting debts that were incurred by
23 the borrower aIter the closing oI the subject loans. She
24 didn't point to anything in the guidelines that says you're to
25 look at that. She didn't point to anything in the guidelines
Camrass2 Page 763
1 that says you're supposed to look at that, because that's not
2 in the guidelines. In Iact, she agreed with me that in the
3 period oI time that these loan Iiles were being underwritten,
4 no originator would have looked at later undisclosed debt.
5 We see here an undisclosed debt, that's a Digital
6 Risk. We're supposed to take that category. When we come back
7 to the 20 loan Iiles that your Honor was presented with on
8 opening, do you know that not every category oI a purported
9 deIect was represent in those 20 loan Iiles? In other words,
10 iI we go back to the charts as to what the deIects purportedly
11 are on these loan Iiles, we did not even get direct testimony
12 as to each category on those charts.
13 Yet we are supposed to accept, Irom the 20 that she
14 decided to pick to talk to the Court about, that we should take
15 that without any discussion about the associated underwriting
16 guidelines, and not only accept the Iindings on that, but then
17 extrapolate that out to a whole body oI loans. It is just not
18 appropriate.
19 That is particularly true because Ms. Walzak agrees
20 with me. One oI her big categories on there is missing
21 documentation. Ms. Walzak agreed with me she engaged in a
22 noniterative process. She had no dialogue with Flagstar. She
23 had no ability to seek missing documentation. The normal
24 clearing oI exceptions that happens in this process typically
25 when it's a live process, a process, Ior instance, that
Camrass2 Page 764
1 happened back on the due diligence --
2 THE COURT: You say she had no contact or no dialogue
3 with Flagstar. How would she have been able to do that? She
4 would have had to contact counsel Iirst. Common experience
5 suggests that counsel would have told her to go Ily a kite. So
6 I don't know that it was realistic Ior her to go down that
7 road.
8 MS. RENDON: Your Honor, that may be the case and that
9 might be the Ioibles oI a lawsuit and maybe creative lawyering
10 could have come up with a solution. My point is as Iar as the
11 accuracy that results Irom that inability, even iI it is an
12 innocent inability, as your Honor is pointing out, it leads to
13 inaccuracies in Iindings.
14 It leads to a claim that we heard Ms. Walzak testiIy
15 on opening: This was terrible, these loan Iiles were bereIt oI
16 things I would have expected to see in there. Well, in the
17 normal process that occurs on this, you have an iterative
18 process, and she agreed, because oI the circumstances and the
19 context likely in which this is occurring, that didn't occur.
20 Your Honor, what we really have here -- I have a
21 6-year-old daughter. I think oI a child's game oI operator. I
22 tell Stewart something, he tells Kevin something, he tells
23 Susan something. By the time it goes through that many layers
24 oI someone passing something along, the message that I started
25 out with is completely garbled and inaccurate by the end.
Camrass2 Page 765
1 THE COURT: That's the liIe oI the modern law Iirm.
2 MS. RENDON: What we see with Ms. Walzak is she had a
3 whole lot oI people working Ior her and she didn't have a good
4 process. She didn't have a consistent approach. She herselI
5 did not have a standard as to materiality that she was
6 operating under. She was relying upon unreliable hearsay oI
7 unqualiIied and undisclosed experts in this case, the people
8 who actually did the work. Under the Federal Rules oI
9 Evidence, it is not qualiIied testimony, and we would ask that
10 it be struck, your Honor.
11 THE COURT: Thank you very much. Let me hear Iinally
12 Irom plaintiII's counsel.
13 MR. BUCHDAHL: Thank you, your Honor. A couple oI
14 problems with the way deIendants are presenting this. When
15 they talk about the Iour withdrawn loans, counsel is talking
16 about why didn't Digital Risk get this right and Digital Risk
17 get this wrong. Digital Risk wasn't getting things right or
18 wrong. Digital Risk was presenting her with data. That is how
19 the underwriting process works.
20 THE COURT: Some oI the data, though, iI I recall
21 correctly, represented the exercise oI their judgment. Yes?
22 It wasn't all statistical.
23 MR. BUCHDAHL: I don't believe that is the case in
24 terms oI Digital Risk's judgment. What is in the Digital Risk
25 Iiles is printouts Irom databases on the computer. That's
Camrass2 Page 766
1 what's there.
2 THE COURT: II you have one handy, let me see the
3 Digital Risk printout on any given loan.
4 MR. BUCHDAHL: Your Honor, while they are getting
5 that, it may be that there are occasional expressions oI
6 Digital Risk opinion in there, but it never went to the
7 ultimate conclusion the expert presented, which is did this
8 materially increase the risk. That is her opinion across the
9 board.
10 Second, they talk about whether or not there is a
11 speciIic guideline check to undisclosed debts. One oI the reps
12 said, we're not going to breach our underwriting guidelines.
13 But there is another rep that says there's not going to be any
14 omission on the part oI any person in this Iile. II someone is
15 sitting there saying, I have another loan that's going to close
16 in two weeks Ior a quarter oI a million dollars on another
17 property you don't know about, even iI it hasn't closed yet,
18 that's unquestionably a material omission.
19 This line they are trying to draw Irom what should
20 have been beIore and should have been aIter, they are trying to
21 compress these misrepresentations into a tiny little category
22 relating to underwriting guidelines. They are vastly broader
23 than that.
24 The reason why in some cases Ms. Walzak said here's
25 how it breached the DTI rule Irom these underwriting guidelines
Camrass2 Page 767
1 and in other cases she didn't mention a speciIic guideline is
2 because the other one is Iar broader than the guideline rep:
3 No error, omission, Iraud, or negligence on the part oI any
4 person. Whether it's the interviewer, whether it's the
5 applicant, whether it's the underwriter, whether it's Flagstar
6 itselI, it doesn't matter.
7 II a loan deIaults, like this police detective's
8 deIaulted, iI a loan deIaults and there was a problem in that
9 Iile, as Mr. Brewer testiIied on day one, that's not Assured's
10 risk. Flagstar took that risk.
11 THE COURT: I don't think it is quite strict liability
12 in the sense you're talking about in that, again, there has to
13 be materiality.
14 MR. BUCHDAHL: That is absolutely true, it has to
15 materially increase the risk. But any time it does that, what
16 is strict about it is that it triggers a contractual remedy oI
17 repurchase. So any loans going bad, really any loans at all
18 need to be repurchased, but particularly those that are
19 deIaulting, iI it was material, it materially increased the
20 risk to Assured, that's on them. Error, omission, Iraud, or
21 negligence is a heck oI a lot broader than simply the
22 underwriting guidelines.
23 They talk about missing documents. I don't want to
24 spend a lot oI time on that. But when we request Irom an
25 adversary in a lawsuit all the loan Iiles, they can't really
Camrass2 Page 768
1 give us the loan Iile six weeks beIore our expert report is due
2 and then criticize us in court a year later and say, there
3 might have been other documents we didn't give you, why didn't
4 you ask Ior those. That can't be how this process works. That
5 would be a game oI gotcha that no one would countenance.
6 Again, what the people working Ior Ms. Walzak did -- I
7 would invite the Court, beIore making any decision here, to see
8 what their underwriting expert did also. What you will learn
9 is that it was the same process. This is how underwriting
10 experts work.
11 II you move up in the world oI underwriting, you don't
12 still sit there with the loans. You manage people, you review
13 their work, you see iI they are missing things, you do quality
14 control. That's what their expert does Ior a living, that's
15 what our expert does Ior a living. The Iirst-line
16 underwriters, that's an entry level position.
17 Leaving that aside, they Ilagged problems, income
18 problems, debt problems, valuation problems oI property.
19 Digital Risk provided them with more data. Ms. Walzak had to
20 decide were these material problems.
21 When they say, hey, your PayScale.com methodology
22 isn't that reliable, because someone who has been running a
23 Iinancial company Ior a number oI years makes a heck oI a lot
24 more money than you said, they are the ones who are not looking
25 at the rest oI the Iile. Our expert did. Our expert noticed
Camrass2 Page 769
1 the problems in this Iile independent oI this.
2 One Iinal thing about this methodology. It is
3 standard underwriting methodology and everyone would agree with
4 that. It is in the actual guidelines. It is how all oI these
5 experts proceeded. The people who were helping Ms. Walzak
6 didn't make any determinations about whether a loan materially
7 breached a rep. Those are Ms. Walzak's Iindings.
8 They had an opportunity to cross her on any one oI
9 those loans, and they never did. They never said to her, Ms.
10 Walzak, we're going to show you something you relied upon.
11 Having seen this and seen this error, do you withdrew your
12 Iinding? Didn't happen once, including with these problems
13 they say they Iound in PayScale.
14 Again, your Honor, this is a big law Iirm who have had
15 these Iiles Ior a year. In 610 Iiles they Iound one place
16 where they say we inputted the wrong number to PayScale.com.
17 One, one error in 610 loans aIter having these Iiles Ior a
18 year. II anything, this process, and it always is, cross-
19 examination is always the best check on this, which is why this
20 ultimately doesn't go to admissibility, it goes to weight.
21 THE COURT: All right. BeIore I hear anything more, I
22 saw a Iile wending its way to plaintiII's desk. Maybe I can
23 take a look at that Ior a moment.
24 MS. RENDON: Your Honor, may I? There were some
25 statements that I want to make sure we have clarity on the
Camrass2 Page 770
1 record about.
2 MR. BUCHDAHL: Can I?
3 THE COURT: Yes.
4 MR. BUCHDAHL: In conclusion --
5 THE COURT: Don't conclude yet. Let me take a quick
6 look at this.
7 I don't understand what's been given to me here. What
8 I was looking Ior was the analysis on a given loan by Digital
9 Risk. The question was whether that was just data or whether
10 it included interpretive or subjective comments. The Iirst
11 Iile I was given was 500485979. I see some input Irom Clear
12 Capital. I'm not clear where there is any input Irom Digital
13 Risk on that one.
14 MR. BUCHDAHL: Your Honor, I'm sorry. My
15 understanding was that the two Iolders, and someone correct me
16 iI I'm wrong, the two Iolders I handed you, one was the Clear
17 Capital and one was the Digital Risk.
18 THE COURT: Let me look at the other one.
19 MR. BUCHDAHL: To the same loan.
20 THE COURT: The second Iile is labeled 500529094, so
21 it doesn't sound like it's the same loan.
22 MR. BUCHDAHL: It's one example oI a Clear Capital,
23 one example oI a Digital Risk, your Honor.
24 THE COURT: I don't know whether these are
25 representative or not. I'll leave that to deIense counsel to
Camrass2 Page 771
1 check out over the next break. In 500485979, where the input
2 is Irom Clear Capital, it is essentially data. There is some
3 number crunching, but not any interpretation. In the second
4 one, 500529094, there actually is both input Irom Clear Capital
5 again and number crunching and some documentation supplied by
6 maybe Digital Risk.
7 I still don't see in either oI those the kinds oI
8 analysis that I have seen in other exhibits Irom Digital Risk.
9 MR. BUCHDAHL: Your Honor, I don't want to overstate
10 it, because there is one place where Digital Risk provided
11 narrative, and some oI that is reIlected in the spreadsheet
12 itselI. When I said there are no Iindings, the Iindings would
13 inIorm her in writing there is this existing undisclosed debt
14 oI whatever magnitude that would accompany their package that
15 they had here.
16 So I guess there is some level, although I think it is
17 minimal, some level oI subjectivity to what they chose to Ilag
18 to her. They didn't give her an unadorned Iile and let her
19 pick through and Iind things. The same way the underwriters
20 Ilagged things Ior her, Digital Risk Ilagged things Ior her.
21 That's how it was assembled.
22 THE COURT: I think I understand what that situation
23 is. Let me hear Irom deIense counsel in surrebuttal.
24 MS. RENDON: I think we are on sursurrebuttal, your
25 Honor. I want to expound on what I think we were just hearing
Camrass2 Page 772
1 coming Irom Mr. Buchdahl, because that is my understanding.
2 As you can see -- and I don't have the particular
3 Digital Risk Iile, but I'm conIident because I have seen many
4 oI them -- what you see is that they gave a loan Iile to Ms.
5 Walzak -- a Digital Risk Iile I should say, not a loan Iile, to
6 Ms. Walzak. It had selected out oI it. They are thin. They
7 are much thinner than the loan Iiles themselves.
8 The judgment, your Honor, that you see coming Irom
9 them is where they are pointing to a big line, undisclosed,
10 undisclosed, where they are putting in one piece oI paper that
11 says PayScale, let me do the math Ior you, Ms. Walzak. They
12 don't show what they input into that. They just give the
13 output oI that and say there you go, that's why there's a DTI.
14 Then they do the DTI purported miscalculation, or recalculation
15 I should say. Then they give a written report to Ms. Walzak,
16 which is cut and paste and put into the Iindings on Ms.
17 Walzak's Exhibit B.
18 When you read, and I don't have this particular loan
19 Iile to do that, but when you read the comments in here, what
20 you see is the Digital Risk commentary, the written component,
21 oI what they Iound Irom their purported Iraud review. What Ms.
22 Walzak claims is she reviewed Digital Risk's Iindings.
23 But the best she had was a Digital Risk Iolder that
24 does knowledge more than what your Honor sees up there, it has
25 the one piece oI paper, saying this is our Iinding. It doesn't
Camrass2 Page 773
1 show how they got there through all the steps, so that Ms.
2 Walzak could reveriIy and understand their process. That's the
3 problem.
4 it is true I didn't go through every Digital Risk Iile
5 I could have to show that there were mistakes being made,
6 probably innocent. I'm not necessarily saying Digital Risk
7 went out to do something inappropriate, but there were mistakes
8 made. There were improper inputs, there were discretionary
9 inputs that had to happen, all to generate these Iindings.
10 And nothing in those Digital Risk Iolders allows Ms.
11 Walzak to get behind that. What she has is a nice big arrow
12 that says pick this undisclosed debt, pick that, here is the
13 income Iraud. Then you see that regurgitated on her Exhibit B.
14 That is the same thing we hear happened with her eight
15 underwriters. What she claims is that she used this guidance.
16 Mr. Buchdahl said in his statements that it was Ms. Walzak who
17 made that ultimate Iinding.
18 Actually, when I cross-examined Ms. Walzak on that
19 U126 question, the big question, the double-negative question,
20 which is Ior some reason written conIusingly in the
21 double-negative, we had to ask her about whether or not her
22 underwriters would have been conIused by that question. She
23 agrees she was taking input Irom them, she was seeing what
24 their comments were, how they Iilled out that big question, and
25 she was using that as guidance.
Camrass2 Page 774
1 What Ms. Walzak was getting Irom a whole bunch oI
2 Iolks was their input, and then she says she put her imprimatur
3 by agreeing on it. But I think your Honor asked her, or I
4 asked her, I think it was your Honor, how oIten did you
5 disagree? How oIten did you come to a unique Iinding that was
6 separate Irom the Iinding that was being Ied to you? And she
7 said basically never.
8 I think that is telling here. It demonstrates here
9 that there is a lack oI process, a lack oI appropriate reliance
10 on hearsay, an inability to articulate what is underlying the
11 results, an inability to articulate clear, concise standards oI
12 materiality. Then you just have this Exhibit P, which is this
13 amalgamation oI all these diIIerent people's inputs and Ms.
14 Walzak claiming, yeah, but I knew what 126 was.
15 Your Honor, with all due respect, this is a good
16 example oI expert testimony that should be excluded. Thank
17 you.
18 MR. BUCHDAHL: Very brieIly, your Honor.
20 MR. BUCHDAHL: The Court asked the witness very
21 directly, U126, the ultimate question, your opinion or someone
22 else's? She said, my opinion.
23 I want to point out one other question. You said,
24 wouldn't it have been a good check to know iI they were getting
25 this right iI the question was conIusing? Guess what. Maybe
Camrass2 Page 775
1 it did conIuse the underwriters. It didn't conIuse Ms. Walzak.
2 She had to know what the right answer to that question was to
3 support her Iinding on every loan, and she did.
4 Ultimately, again, she was not challenged on a single
5 Iinding that a misrepresentation was material or in Iact that
6 there were misrepresentations. Because they can't attack the
7 results, they are just going to attack the process.
8 Everything they have said, your Honor goes to weight
9 under the case law, everything they have said. There is no
10 reason to strike this witness on methodology. Sure there could
11 be a mistake in the Digital Risk process, absolutely. It may
12 go to weight, but none oI this goes to the admissibility oI
13 this expert testimony.
14 THE COURT: I'm glad we have reached the point now
15 where both counsel haven't Ielt the need to inject some passion
16 into their argument.
17 Let's hear now Irom Mr. Aaron on the other challenges.
18 MR. AARON: Thank you, your Honor. Stewart Aaron on
19 behalI oI Flagstar. I'm going to speak to a couple oI issues
20 here. It is actually Iour issues. I don't know why I said a
21 couple, Judge. Sampling, Lipshutz, Mason, and 52(c).
22 With respect to sampling, iI your Honor recalls, we
23 had submitted an in limine motion on this issue.
24 THE COURT: Yes.
25 MR. AARON: Back when, and your Honor reserved on it.
Camrass2 Page 776
1 THE COURT: I think the word is "punted," but yes.
2 MR. AARON: Yes. While statistical sampling and
3 extrapolation may work as a method oI prooI in certain cases,
4 what the record here shows and the testimony by the experts
5 here has shown is it really isn't a reliable technique to
6 ascertain either liability or damages in cases involving
7 breaches oI representations and warranties concerning
8 residential mortgage loan Iiles.
9 More speciIically, this plaintiII has not demonstrated
10 that extrapolation based on sampling is appropriate in the
11 context oI this case. Let me explain to you why. I'm going to
12 give you citations to the trial record to the extent it will be
13 helpIul.
14 Ms. Walzak testiIied that each loan Iile is unique and
15 individual in nature. That's at pages 556/lines 5 to 9 and
16 613/lines 10 to 12. Ms. Walzak Iurther testiIied that
17 determination oI whether any material breach existed in a loan
18 Iile boiled down to circumstances present in an individual Iile
19 and that each Iile must be evaluated individually. That's at
20 page 555/lines 22 to 25, page 558/lines 2 to 14.
21 Ms. Walzak testiIied that whether a breach is present
22 in a loan Iile is never, her word, a binary decision. Page
23 556/lines 18 to 22. Rather, whether a breach was material
24 depended on whether or not a breach existed -- excuse me -- did
25 not depend on that but rather depended on the serious nature or
Camrass2 Page 777
1 the severity oI breach. Page 555/lines 14 to 21.
2 What did Dr. Lipshutz have to say? We are not
3 challenging him because he is not a great expert. Dr. Lipshutz
4 sounded like a very knowledgeable person in the Iield oI
5 statistics. Has a lot oI degrees, has a lot oI great things to
6 say. What he said was that he had understood that his client,
7 quote, was going to make a binary decision on each loan whether
8 or not that loan's underwriting comported with the
9 representations and warranties. Page 257/lines 2 to 12.
10 What he Iurther said was the calculation oI sample
11 size depends on what's being measured, whether or not it's a
12 binary decision, iI your Honor recalls that. Page 279/line 17
13 to 280/line 7. What he said was that the sample size required
14 iI it's not a binary decision could be larger, could be
15 smaller, but you calculate the sample in a diIIerent way.
16 THE COURT: I want to go back and take a look Iirst at
17 Ms. Walzak's reIerence to binary. I'm not sure we are talking
18 about the same meaning there. I understand his meaning, it's
19 either yes or no. She basically was ultimately doing a yes or
20 no on each oI those loans. Let me see iI I can Iind it.
21 MR. AARON: It's page 556/lines 18 to 22.
22 May I please have the transcript.
23 THE COURT: I got it. 556.
24 MR. AARON: Your Honor, I'm reIerring to page 556,
25 starting at line 10.
Camrass2 Page 778
1 THE COURT: Yes. I see her testimony, and it's along
2 the lines you indicated, but I don't think she is using
3 "binary" in the same sense that he was. Ultimately, what she
4 did was make no decision as to whether there had been a
5 material breach or not.
6 MR. AARON: Your Honor, what I think she did in that
7 process was exercise subjective judgment oI severity. I
8 believe her testimony Iairly read said --
9 THE COURT: I agree with that. She is conIirming, and
10 we talked about this a Iew minutes ago, that it's not a bright-
11 line rule type situation. You have to look at the whole Iile,
12 and then you can make a determination. What he is talking
13 about, I think, is that you needed a sample size that would be
14 big enough to be extrapolatable, iI there is such a word, where
15 ultimately you were dealing with a yes/no situation.
16 And she is ultimately dealing with a yes/no. The Iact
17 that it is subjective rather than objective goes to whether
18 that is a proper methodology, what your colleague and I just
19 discussed and plaintiII's counsel. But I don't know that it
20 goes to sample size, or you need to tell me why it goes to
21 sample size.
22 MR. AARON: Your Honor, what I'm stating is according
23 to Dr. Lipshutz' testimony, iI an expert is trying to
24 determine, like Ms. Walzak, what the severity is oI certain
25 violations, the number oI violations, Ior example, as opposed
Camrass2 Page 779
1 to just saying was there a material breach oI representation,
2 yes or no, iI it's severity, it's a diIIerent calculation.
3 What Dr. Lipshutz was saying, and I believe we have in
4 evidence his declaration in opposition to the motion in limine,
5 there is a very complex Iormula that I went on the Internet and
6 plugging the numbers in and it spat out. It is a very complex
7 Iormula. What he is saying is it's a diIIerent Iormula. The
8 sample size may be smaller, it may be larger, but my point is,
9 Judge, that Dr. Lipshutz wasn't told the right thing here.
10 THE COURT: Again, I'm not sure I Iully Iollow what
11 you are saying. I thought what he was saying was this. For
12 example, iI you had a sample oI mortgages and you divided them
13 into three categories -- no breach, breach, and material
14 breach -- then you wanted to extrapolate those three categories
15 to the Iull Iield, you would need a larger sample than you
16 would need iI you just were going to go no breach versus
17 material breach. I understand that completely.
18 The point you're now making seems to me to be a
19 totally diIIerent one. What you are saying is that by its very
20 nature a subjective determination does not lend itselI to
21 extrapolation regardless oI the size oI the sample unless the
22 sample is 99.9 percent, because there are too many ways to skew
23 the whole process. II that's right, it's only because her
24 methodology is Ilawed to begin with. So I really think this is
25 subsumed in your colleague's argument.
Camrass2 Page 780
1 MR. AARON: I'll make two quick points. You are
2 absolutely right, your Honor. One oI the things I'm saying is
3 this is such a subjective inquiry, it can't be extrapolated
4 onto the entire population Irom this sample. That's the Iirst
5 thing I'm saying.
6 The second thing I'm saying, it's a very minor point
7 and I will move on, is what Dr. Lipshutz testiIied on pages 279
8 and 280 oI the trial transcript is it depends how you calculate
9 the sample size, it depends on what it is you're trying to
10 measure.
11 My understanding oI his testimony on those pages is iI
12 I knew that what you are trying to measure is what the severity
13 was oI breaches as opposed to whether or not there was a
14 material breach yes or no, I would have calculated the sample
15 size diIIerently. The sample size may have been larger, the
16 sample size may have been smaller. I'm just commenting on that
17 Dr. Lipshutz would tell you that the methodology is diIIerent.
18 THE COURT: I take the point, although I think, Irom
19 the little I remember Irom my college statistics course, the
20 sample size would be larger, it wouldn't be smaller under those
21 circumstances.
22 MR. AARON: Your Honor, moving on, even iI Dr.
23 Lipshutz's opinions are properly applied here, the sample size
24 is properly applied here, the damages claims that Dr. Mason
25 puts Iorth are not proper. The Iirst reason Ior that is what
Camrass2 Page 781
1 your Honor brought at the beginning oI the question oI Dr.
2 Mason, and this goes exactly Ior what Ms. Rendon was talking
3 about, that his opinions are premised on Ms. Walzak's. So iI
4 Ms. Walzak is excluded, Dr. Mason should be excluded.
5 Additionally, because oI the testimony oI Dr. Lipshutz
6 with respect to sample size, the damages calculations that were
7 utilized by Dr. Mason are unreliable. What Dr. Lipshutz
8 testiIied that in order to be 95 percent conIident that the
9 portion oI any property being measured in the samples was known
10 within plus or minus 5 percent, the sample size had to be 371
11 Ior the 2005-1 pool and 358 Ior the 2006-2 pool. II your Honor
12 recalls, he rounded up to 400.
13 Dr. Lipshutz also testiIied that a sample size oI 50
14 or even 80 would not be adequate to estimate a proportion at a
15 90 percent conIidence level within that same conIidence
16 interval, that margin oI error oI plus or minus 5 percent. Yet
17 when calculating damages based on the January 2009 Irustration
18 date, which is the date that plaintiII chose to measure the
19 time, the sample sizes were in the same ranges that Dr. Mason
20 talked about.
21 Ms. Gaylor, iI I could have up the 2006-2 spreadsheet.
22 Your Honor, this is the very exhibit that I showed.
23 It's Exhibit AYM in evidence.
24 II your Honor looks in the upper leIt-hand corner oI
25 loan count, there are 400 loans in the sample Ior 2006-2.
Camrass2 Page 782
1 Under Dr. Mason's spreadsheet, iI you look at adverse loan
2 count, iI you look down where it says 47, that was the number
3 oI loans as oI January 2009 that had been charged oII. What
4 the plaintiII said was that they were basing their damages here
5 on charged-oII loans.
6 The reason they are basing damages on charged-oII
7 loans is not because they are trying to give us the beneIit oI
8 the doubt, but rather because that is the only place where they
9 are damaged on charged-oII loans. What Dr. Mason does, he then
10 calculates a percentage oI what the principal balance is oI
11 those charged-oII loans, that's the 3,841,200, as compared to
12 what the principal balance was oI the 37 charged-oII loans that
13 purportedly had deIects.
14 II your Honor recalls, I had a spreadsheet that was a
15 demonstrative Ior the 2006-2 time Irame that we called A that
16 had shown that there were about 12 loans that were improperly
17 listed as charged oII. That 47 count drops to 35. In essence,
18 what's happening here is that Dr. Mason is extrapolating Irom
19 35 charged-oII loans to thousands oI loans. In the 2006-2
20 population there were a total oI 5,112 loans. What is
21 happening is that Ior 35 loans we are extrapolating onto 5,000
22 loans.
23 It is even worse in the 2005 pool. Ms. Gaylor or Ed,
24 iI you could pull that up. You need to go to the bottom right,
25 iI this is the correct exhibit.
Camrass2 Page 783
1 This is DeIendant's BBK in evidence. Again there is a
2 loan count oI 400 in column V, the January 2009 Irustration
3 date. There are 37 loans that have charged oII. What Dr.
4 Mason does is he looks at 34 oI those that supposedly had
5 breaches out oI those 37, and again he looks at what the
6 principal balances were, the original principal balances, and
7 that's how he arrives. He divides the adverse breach balance
8 by the adverse balance and comes up with the 87.59 percent.
9 Again, one oI the problems that he has in addition to
10 this deIicient methodology is I put beIore him DeIendant's
11 Exhibit B, where I calculated that there were about 15 or so
12 loans that were improperly included there.
13 The long and the short oI it, Judge, is under Dr.
14 Lipshutz's, their own statistical expert's, opinion, the sample
15 sizes here just aren't adequate to extrapolate to the size oI
16 the pools. In the 2005-1 pool the population is 10,025.
17 The real prooI oI this I think came out on redirect.
18 What happened on redirect, iI your Honor recalls, is that by
19 removing the number oI loans or reducing the number oI loans
20 that were charged oII, what his counsel brought out was that
21 the adverse breach rate actually went up.
22 Applying that to the current circumstance, your Honor,
23 what Assured would have you believe is that by taking loans out
24 oI this sample, the amount oI damages that my client is
25 supposed to pay is more. There plainly is a Iailure oI prooI
Camrass2 Page 784
1 as to damages here, your Honor.
2 What Rule 52(c) is Ior, as your Honor is well aware,
3 it's the Rule 60 Ior bench trials. There really has been a
4 Iailure oI prooI here, Judge. As you pointed out, the
5 plaintiII did not oIIer the Flagstar underwriting guidelines
6 into evidence. Without the underwriting guidelines, there's no
7 way that your Honor can properly assess whether the guidelines
8 were met or weren't met.
9 What else? How many underwriting loan Iiles are in
10 evidence? I heard Mr. Buchdahl say there were 20. He, oI
11 course, picked out that in Ms. Walzak's report there were ten
12 really bad ones and then there is one that we have all been
13 Iocusing on. What they are asking your Honor to do at this
14 stage oI the case is Irom one loan, one loan, they want to
15 extrapolate onto 16,000 and hit my client Ior $111 million
16 worth oI damages. There's been a Iailure oI prooI, and we are
17 entitled to judgment under Rule 52(c).
18 Thank you, Judge.
19 THE COURT: Thank you.
20 Let me hear Irom plaintiII's counsel.
21 MR. BUCHDAHL: Your Honor, it's telling that
22 deIendants have no expert in statistics here, because no expert
23 in statistics would ever agree with counsel's argument. It's
24 also telling that they had no expert oI their own to run a
25 repurchase model, because no expert in that Iield would agree
Camrass2 Page 785
1 with what he is saying about that.
2 Here is why that he is saying about sample size makes
3 no sense at all. I'll start with the testimony oI the expert
4 on this. I believe you have page 288. II you don't, we can
5 get it Ior you. The date was October 12.
6 THE COURT: While we are getting that, let me take
7 this opportunity to return the two loan Iiles. 288?
8 MR. BUCHDAHL: 288, your Honor. In our copy it's
9 right at the top oI the page, redirect examination. Because it
10 was very clear what Mr. Aaron was trying to do on cross, the
11 very Iirst question on redirect was the Iollowing.
12 "Q. First oI all, iI 50 oI the 400 loans in one oI the random
13 samples you selected exhibited a particular characteristic,
14 would you expect that proportion oI the sample to carry over to
15 the broader population oI the loans in the pool?
16 "A. Absolutely." I apologize that he used that word, too.
17 "Absolutely. That's the purpose oI constructing a random
18 sample."
19 OI course that's the purpose oI conducting a random
20 sample. II you were to listen to Mr. Aaron, here's what would
21 happen. You would say, how many people do I need to poll to
22 Iigure out who is Ior Romney and who is Ior Obama. You would
23 tell me let's use 500. How many are Ior Obama? Maybe these
24 days it's 251. Then he'd say, well, guess what, your sample
25 size isn't big enough, because you have 251, you don't have
Camrass2 Page 786
1 500. You could never stop this kind oI analysis, which is why
2 no statistician would ever endorse it.
3 Look at what Dr. Mason did. II you can put that chart
4 back up that he was looking at here Irom the spreadsheet. You
5 can use 06 or 05. This will work.
6 What counsel Ior the deIense is Iocusing on is this
7 number, 47. That's the number oI loans that we said deIaulted.
8 It turns out that it included a Iew that were merely very
9 delinquent in this pool. He says you're using 47 out oI 400.
10 Sure, that's how many deIaulted by January oI 2009.
12
13
14
15
16
17
18
19
20
21
22
23
24
25
1 But Irankly, your Honor, it doesn't matter because iI
2 you want to move to here or here, you can see that these, it is
3 consistent that this number is very high number. II you back
4 up the process and just look at the initial deIect rate because
5 again these representations were Ialse at the time oI closing,
6 you've got a 75.56 percent average deIect rate right at the
7 time oI closing.
8 THE COURT: Well, this may be totally wrong, but since
9 I mentioned it has been a Iew years since I had statistics, but
10 I basically agree with you with this caveat:
11 II you have a random sample in a binary situation and
12 your Iormula tells you that you need 400 to make it a valid
13 sample to a 95 percent conIidence level -- all presupposing, by
14 the way, it is the kind oI situation that Iits a bell curve,
15 which is really the underlying assumption oI all oI this which
16 may or may not be true, we are assuming that is true, you can
17 always challenge that here -- then you can Iairly say iI X
18 number oI the 400 had characteristics oI Y, then we can Iairly
19 extrapolate to the entire 12,000 or whatever and say that same
20 percentage will have characteristics oI Y, with the caveat that
21 the conIidence level may change, and I don't recall either side
22 asking Dr. Lipshutz about to what degree the conIidence level
23 would change in respect to this calculation oI damages. So I
24 think it may be neither here nor there, but that is at least my
25 rough recollection oI something I thought that was repressed.
1 MR. BUCHDAHL: I want to say two things, and I will
2 sit down: One, our burden is Iar short oI 95 percent
3 conIidence on this. It is a preponderance oI the evidence. We
4 have met that burden Ior sure.
5 Second --
6 THE COURT: That is an apples or oranges comparison,
7 but go ahead. Go ahead, go ahead. Go ahead with what else you
8 had.
9 MR. BUCHDAHL: My next point, one oI the things Dr.
10 Mason talked about and testiIied to, and to the extent this
11 moves during the deIense case, we can bring him back Ior
12 rebuttal, but one oI the important parts oI his testimony is
13 these percentages Iar exceeded the amount necessary Ior Assured
14 to get Iull reimbursement.
15 That is obviously a critical part oI understanding
16 this because as he testiIied, as had they repurchased these
17 loans appropriately, there would have been excess,
18 over-collateralization developing in the trust that would have
19 prevented Assured Irom taking its claims and these numbers were
20 well in excess oI the number necessary Ior that.
21 Look, the testimony has shown that Assured paid $90
22 million in claims, and with interest we get to $111 million in
23 combination oI contractual and statutory interest. The
24 evidence has shown grievous substantial problems in these loan
25 Iiles. There is no Iailure oI prooI that a speciIic,
1 respectIully, that the speciIic underwriting guidelines are not
2 in evidence because every -- and they're undisputed what the
3 nature oI those guidelines are -- but critically, it would be
4 very, very diIIicult to have an underwriting error that
5 wouldn't also run aIoul oI the more broad representations that
6 there is no error, omission, negligence or Iraud just by their
7 very nature.
8 We have proved our case on liability with the use oI
9 this sample and we submit we proved our case on damages.
10 You'll hear no expert testimony to rebut anything Irom our
11 statistician or our damages expert along these Iields.
12 THE COURT: All right. Let me hear on rebuttal Irom
13 Mr. Aaron.
14 MR. AARON: Your Honor, I promise my rebuttal will be
15 short and very accurate, as I am reading Irom the testimony oI
16 Dr. Lipshutz. First oI all, Page 270 line 11 --
17 THE COURT: Hold on. 270, did you say?
18 MR. AARON: Yes, Page 270 line 11.
19 THE COURT: Hang on.
20 "Q Is it Iair to say iI the sample in size in this case were
21 50, in your expert opinion would that be an adequate sample?
22 "A A sample oI 50 Ior the purpose oI determining the
23 proportion within the sample would not enable you to estimate
24 that proportion plus or minus 5 percent with a conIidence oI 95
25 percent. It doesn't mean you can't make an estimate. As a
1 general proposition, you can make estimates using small
2 numbers, but the certainty goes down as the item sample goes
3 down.
4 "Q Does the margin oI error go up in that circumstance as
5 well?
6 "A It depends on how you have built it and depends on what you
7 mean by margin oI error. The sample that I built said that at
8 95 percent conIidence level, the margin or error is plus or
9 minus 5 percent.
10 "Q With respect to a sample size oI 80, would that be adequate
11 with respect to the pools at issue in this case?
12 "A It would not produce an estimate with the same statistical
13 properties. The level oI certainty would be lower."
14 THE COURT: I'll stop there. I think that is actually
15 what I was just saying myselI.
16 MR. AARON: Exactly. The second point I would like to
17 make, Judge, on Page 292 line 5 oI Dr. Lipshutz's recross, a
18 critical point here which I neglected to make earlier, Judge,
19 is that Dr. Mason -- excuse me -- Dr. Lipshutz, who is their
20 statistics expert, did not touch Dr. Mason's analysis. The
21 question I asked him at Page 292 line 5 is:
22 "Q Am I correct you did not look at as part oI your evaluation
23 the samples that Dr. Mason used to calculate his damages, the
24 sub-examples?
25 "A That's correct."
1 Dr. Mason's analysis is not statistically valid and
2 their own statistician made no eIIort to even testiIy or render
3 an opinion with respect to Dr. Mason's analysis. That is all I
4 have, Judge.
5 THE COURT: All right.
6 MR. BUCHDAHL: Very brieIly: First, the testimony he
7 read was asking Dr. Lipshutz would you have less conIidence iI
8 the overall sample was 50, not what about let's look at a
9 proportion that is 50. I think that was pretty clear. II you
10 look at Page 473, now we are on October 15th, Page 473 starting
11 at line 5.
12 BY THE COURT:
13 "Q Am I correct you would be basing your damages calculations
14 on less than 45? Isn't that right?
15 "A No.
17 on less than 45 oI 400 loans. Isn't that right?
18 "A No.
19 "Q The percentage is based upon 45 oI 400 loans, is it not?
20 "A Exactly. The percentage is based on 45 oI 400 loans. I am
21 basing my observations on 400 loans that were sampled."
22 MR. BUCHDAHL: II I may, your Honor?
23 THE COURT: Yes.
24 MR. BUCHDAHL: I think Dr. Mason's testimony right
25 there shows his grasp oI the statistical principle at play
1 here. It is a 400 loan sample he was working with, and he
2 understood that, which is why he very plainly rejected this
3 notion he is basing his damages calculation simply on 45 loans.
4 That is what that "no" answer means in line 7.
5 THE COURT: I am sorry. To me it is ambiguous because
6 back on line 5:
8 on less than 45 oI 400 loans? Isn't that right?
9 "A No.
10 "Q The percentage is based upon 45 oI 400 loans, is it not?
11 "A Exactly. The percentage is based on 45 oI 400 loans. I am
12 basing my own observations on 400 loans that were sampled."
13 So I took the "no" to mean no, it wasn't less than 45,
14 it was 45.
15 MR. BUCHDAHL: The number on the board was 37. I will
16 say this: We submitted directly on this point aIIirmations by
17 both Dr. Mason and Dr. Lipshutz, explaining what they're saying
18 is wrong and one oI those was certainly introduced into
19 evidence.
20 For Daubert purposes, the court certainly can consider
21 either oI those aIIirmations in considering whether Ior
22 reliability purposes this testimony should come in. I think
23 those aIIirmations leave zero doubt on this point.
24 THE COURT: I agree with you that Ior Daubert
25 purposes, I can consider those aIIirmations Irom both sides, so
1 I will do that.
2 Now, let's discuss scheduling. I am going to be at
3 lunch Irom 1:00 to 2:00, so we do have a Iew minutes now. I am
4 inclined to think, at the risk oI once again ducking what is a
5 very interesting but complicated set oI issues, that I will
6 reserve on all oI these till the close oI the case. This is a
7 luxury the court is given in a Bench trial, but as the
8 discussion has indicated, there are, Ior example, things I want
9 to now look at in those aIIirmations that I haven't looked at
10 since the time oI the motions in limine. I also want to go and
11 look at the testimony again more careIully in light oI all this
12 discussion.
13 So I am neither denying or granting any oI the
14 motions. They will all be reserved till the end oI the case.
15 That means, by the way, I point out to deIense counsel that the
16 motion will be assessed as oI the state oI the record now. I
17 will also perhaps reassess it as oI the state oI the record at
18 the close oI all the evidence. You don't lose your right to
19 have it assessed as oI the state oI the record now.
20 Now, I had promised you would we would go to 7:00
21 o'clock today. I know you're all so eager to have that happen.
22 You will be very disappointed to learn that as I expected over
23 the break, other matters have come up which I will take at
24 5:00. We'll go to 5:00, but now any other matter interrupting,
25 but we won't go to 7:00.
1 PlaintiII's counsel, I really didn't give plaintiII's
2 counsel the opportunity to say anything Iurther iI you wanted
3 to on the issue we discussed at the sidebar. II you want to,
4 you can come to the sidebar. II you don't, I consider it past
5 history.
6 MR. BUCHDAHL: I would love to say just one thing.
7 THE COURT: Come to the sidebar with counsel and the
8 Court Reporter.
9 MS. RENDON: Your Honor, there is one thing that we
10 wanted to be clear about the Mason aIIirmation that had been
11 raised previously that we would like to have on the record
12 beIore we adjourn.
14 MR. AARON: Ms. Rendon accurately points out to me the
15 declaration Dr. Mason submitted in opposition to the in limine
16 motion includes some opinions that were not in his original
17 opinion.
18 THE COURT: Those are not being received.
19 MR. AARON: Thank your Honor.
20 (By Order oI the Court, the Sidebar conIerence is
21 sealed)
22 (In open court).
23 THE COURT: All right. We will reconvene --
24 MR. BUCHDAHL: II we are just going to break, I will
25 wait.
1 MS. RENDON: I have just one last housekeeping matter
2 only because it aIIects our timing as to our witnesses. We had
3 indicated that one oI the witnesses that we planned on
4 presenting was approximately three hours oI a videotape
5 deposition oI a Iormer Assured employee. II the court were to
6 simply just take that by transcript, that would aIIect our
7 timing as to our lineup, so I wanted to understand.
8 THE COURT: I originally thought we would have the
9 luxury oI having these matters played in open court, but unless
10 there are objections that need to be dealt with, I am perIectly
11 happy to just take the transcript and read it over at my
12 excessive leisure between midnight and 2:00 am.
13 MR. BUCHDAHL: I don't want to discourage you Irom
14 receiving the transcript. I do want to say when we received
15 renewed designations Ior this witness, approximately 50 oI
16 those designations in our view concern the topic oI loss
17 modeling, and so again iI we are not going to spend the time in
18 court, the objection in some ways is oI less consequence. You
19 have already heard about this. Your can hear as much as you
20 want on your own time.
21 THE COURT: Are the objections stated in the margin oI
22 the transcript?
23 MR. BUCHDAHL: They likely are not.
24 THE COURT: Here is --
25 MS. RENDON: They are.
1 MR. BUCHDAHL: They are, your Honor.
2 THE COURT: Then I will just rule on them as I read
3 them.
4 MS. RENDON: II I may, though, the words "loss
5 modeling" will appear in some oI those. It is coming in not
6 Ior the purposes that we have discussed previously. Those are
7 actually designed -- the loss modeling discussed in this
8 portion oI the transcript, iI I may, just to respond to the
9 objection, is because it shows the depth and breadth oI the
10 analysis that was done on the collateral; speciIically, the
11 access model which is discussed by Mr. Stiehl takes inIormation
12 oII the loan data tape and then stratiIies all the data oII
13 that loan data tape.
14 The ultimate purpose is to run a loss expectancy
15 number. The reason we were designating these portions oI the
16 transcript and associated exhibits is because it shows you the
17 depth and the breadth by which Assured came to understand all
18 the stratiIications oI data and all the attributes oI the
19 underlying collateral on a loan-by-loan basis as well as at a
20 transaction basis.
21 So we were not trying to get this in Ior the purposes
22 oI the type oI discussion we were having with Mr. Brewer, but
23 to demonstrate, in Iact, the depth and level oI understanding
24 oI the speciIic collateral and the attributes oI the collateral
25 going in. I want to be clear there was a diIIerent purpose in
1 our minds Ior designating this component.
2 THE COURT: Here is what I think when hearing all oI
3 this, and I see your adversary wants to respond as well. Let
4 me do this. BeIore the end oI the trial I will read the
5 deposition with the objections, but I won't yet rule on the
6 objections. I will then hear oral argument oI this global
7 nature on the objections and then rule on it.
9 THE COURT: Someone needs to give me the transcript
10 some time beIore the end oI today.
11 MS. RENDON: Yes. There is a second witness we will
12 get you as well, Mr. Williams, we said we would be putting in
13 by transcript as well.
14 THE COURT: Very good.
15 MR. BUCHDAHL: Since he wasn't going to testiIy today,
16 I haven't made my objections yet.
17 THE COURT: Then you need to mark up the --
18 MR. BUCHDAHL: We'll do that tonight Ior sure.
19 THE COURT: Now, we will sit today till 5:00 o'clock.
20 We will sit a more or less Iull day tomorrow. There may be one
21 or two interruptions. I am working on that now. We will not
22 sit at all on Wednesday. I have the Gupta sentence in the
23 aIternoon, and I have some other matters I can only do in the
24 morning.
25 Now, I don't know iI it will be over by then or not.
1 Now that we have dealt with the transcripts, what is deIense
2 counsel's view oI how many days you'll likely be?
3 MS. RENDON: Your Honor, in order to answer that, we
4 need to go back to our witness list.
5 MR. BUCHDAHL: On the subject oI the Iirst witnesses,
6 very brieIly, Mr. Jursek is identiIied as someone who knew
7 about Iollowing subject: The securitization process associated
8 with the Flagstar Home Equity Trust, data questions and
9 economics. It is unclear to me how they could get two hours oI
10 direct testimony that is relevant to this case Irom this
11 witness, and so aIter the break iI we could get a proIIer oI
12 why this witness has relevant evidence, I think we can
13 streamline the case Iurther.
14 THE COURT: Well, I don't know. I think let's get
15 going with him and see how it goes. All right. See you at
16 2:00 o'clock.
17 (Luncheon recess)
19
20
21
22
23
24
25
1 AFTERNOON SESSION
2 2:15 pm
3 (Trial resumes)
4 (In open court)
5 THE COURT: Please be seated.
6 All right. Please call your --
7 MS. RENDON: BeIore we call the witness, may I do one
8 small housekeeping matter because it makes a diIIerence in the
9 order oI our witnesses.
10 THE COURT: Yes.
11 MS. RENDON: In trying to keep the case as concise as
12 we can and maybe even try to Iinish it this week, we have
13 reconsidered and spoke brieIly with opposing counsel as Iar as
14 we had intended originally oI calling David Beard live. We do
15 have a videotaped deposition oI him and we would propose
16 putting him, submitting him through videotape deposition. I
17 want to make sure that is agreeable subject to, oI course,
18 providing our designations and giving appropriate opportunity
19 Ior objection. We would like to put him in that way which
20 would cut down on the live testimony that needs to be heard in
21 Iront oI the court.
22 MR. BUCHDAHL: No objection.
25 THE COURT: Please call your next witness.
1 MS. SHIN: Your Honor, we call Stan Jursek.
2 STANLEY D. JURSEK,
3 called as a witness by the DeIendant,
4 having been duly sworn, testiIied as Iollows:
5 DIRECT EXAMINATION
6 BY MS. SHIN:
7 Q. Good aIternoon, Mr. Jursek.
8 Are you an employee oI Flagstar?
9 A. Yes, I am.
10 Q. What is your current role in Flagstar?
11 A. I am the executive vice president, treasurer oI Flagstar
12 Bank and the head oI Flagstar Capital Markets Corporation.
13 Q. How long have you been in this role?
14 A. Just over 10 years at Flagstar altogether. I have been the
15 treasurer Ior two years or so and the head oI Capital Markets
16 Ior about two months.
17 Q. Please describe your educational background.
18 A. I have a bachelors degree in economics Irom the University
19 oI Michigan and a masters in business administration and
20 Iinance Irom Michigan State University.
21 Q. Can you describe your proIessional background Irom the time
22 you received your masters.
23 A. Only one other job, that was at Michigan National
24 Corporation, a wholly owned subsidiary oI National Australia
25 Bank. There was I director oI the local treasury operations
camjass1 Jursek - direct Page 801
1 and head oI North American Asset Liability Management.
2 Q. How long were you there?
3 A. I was there 18 years.
4 Q. When did you join Flagstar, Mr. Jursek?
5 A. 2002.
6 Q. What was your role when you Iirst joined?
7 A. I was the asset liability manager.
8 Q. Can you describe your role at Flagstar during the 2005-2006
9 period.
10 A. Yes, I would have been the asset liability manager still.
11 At that time-Irame I dealt with issues such as balance
12 sheet structure, interest rate, risk management, hedging, those
13 types oI activities.
14 Q. What department were you in, Mr. Jursek?
15 A. I was in the asset liability management department within
16 the Capital Markets Group.
17 Q. Were you the head oI that department?
18 A. Yes, I was.
19 Q. Mr. Jursek, is your role an accounting role?
20 A. No. I do have a lot oI interaction with the accounting
21 department. I would describe mine as more oI a Iinancial
22 analyst role that supports many oI the accounting activities
23 that take place, but it is clearly not an accounting role.
24 Q. Do you have any underwriting experience?
25 A. No, I do not.
1 Q. What was your role, iI any, in the 2005-1 HELOC
2 securitization at issue in this case?
3 A. I had several roles with that structure. The Iirst role
4 dealt with data management. I had several analysts in my
5 department that were very skilled at ad hoc queries and
6 securing data, and we worked very closely with JP Morgan in the
7 development oI the data tape Ior the transaction.
8 Q. Did you have any other roles with respect to the 2005-1 --
9 A. Yes, once the transaction was structured and began to take
10 shape, I was also responsible Ior the Iinancial analysis oI it,
11 determining the economic beneIit to Flagstar Ior the
12 transaction and, you know, generating the accounting entries
13 that support it, the deal.
14 Q. We'll come back to discuss that a bit more in a Iew
15 minutes, but let's step back a minute.
16 Mr. Jursek, what is Flagstar Bank?
17 A. Flagstar is a nationally chartered Iederal savings bank.
18 We were a savings and loan at the time.
19 Q. Is it a regional bank?
20 A. Very much a regional bank. At this time we have banking
21 oIIices just in Michigan.
22 Q. How many banking oIIices in Michigan do you have?
23 A. My recollection is about a hundred, right around a hundred.
24 Q. Do you have retail banking branches anywhere other than
25 Michigan?
1 A. No, we do not.
2 Q. What is Flagstar's core business?
3 A. Flagstar's core business would have to be mortgage
4 originations and in particular agency mortgage loan
5 originations.
6 Q. What is agency originations?
7 A. Those would be underwriting mortgages that conIorm to the
8 guidelines set Iorth by Fannie Mae, Freddie Mac, Ginny Mae, the
9 government agencies that basically guarantee mortgages.
10 Q. Are those reIerred commonly as government sponsored
11 entities?
12 A. Yes, they are eIIectively agencies oI the United States
13 Government now.
14 Q. GSEs?
15 A. Yes, GSE.
16 Q. How do these agency or GSE loans get --
17 MR. BUCHDAHL: Objection; relevance.
18 THE COURT: Sustained.
19 MS. SHIN: Your Honor, iI I may, this is a relevant
20 background inIormation to the core business oI Flagstar. This
21 is the Iirst time Flagstar has ever done an agency origination.
22 To the extent that the securitizations done are relevant, I
23 would like the witness to testiIy --
24 THE COURT: You need to Iirst move the microphone
25 closer to you. Let me just look.
1 MS. RENDON: Your Honor, iI I may also just chime in?
2 In Mr. Buchdahl's opening statement, he reIerenced the
3 Iact that Flagstar perIormed so many hundreds oI millions or
4 more in agency, Fannie, Freddie securitizations presumably as
5 demonstrative oI their sophistication in the world oI
6 securitizing residential mortgages, and I think this line oI
7 questioning will go to the Iact that these transactions at
8 issue are non-agency and there is not an analogy to be drawn.
9 MR. BUCHDAHL: To the extent that I said something
10 irrelevant in a part oI this case that is not evidence, I would
11 withdraw it. This is not the experience in securitizations
12 that are diIIerent Irom this one and has no relevance to this
13 case, your Honor.
14 THE COURT: I agree. Sustained.
15 MS. RENDON: Thank you.
16 BY MS. SHIN:
17 Q. Mr. Jursek, had Flagstar had any experience with non-agency
18 loan securitizations prior to the 2005 --
20 Q. -- securitization?
21 THE COURT: Overruled.
22 A. No.
23 BY MS. SHIN:
24 Q. What is a non-agency loan securitization?
25 A. A non-agency loan securitization involves originating loans
1 and structuring your own securities out oI those loans. You
2 have to provide your own credit support in the Iorm oI rating
3 agencies and in some cases insurance companies and perIorm your
4 own due diligence exercises. Basically it is creating your own
5 securities.
6 Q. BeIore the 2005-1 securitization, had Flagstar ever worked
7 with a Monoline insurer in connection with a securitization?
8 MR. BUCHDAHL: Objection, leading.
10 A. Not that I'm aware oI, no.
11 BY MS. SHIN:
12 Q. Had it ever dealt with a rating agency as part oI a
13 securitization?
14 A. No.
15 Q. Had it ever dealt with due diligence as a part oI a
16 securitization?
17 A. No.
18 Q. Given Flagstar's lack oI experience in this area, did
19 Flagstar have assistance?
20 MR. BUCHDAHL: Objection; argument.
21 MS. SHIN: I can rephrase, your Honor.
23 BY MS. SHIN:
24 Q. Did Flagstar have assistance in the securitization?
25 A. Yes, we enlisted the help oI JP Morgan Securities to
1 eIIectively help us through the process. Again it was our
2 Iirst transaction and we needed somebody to, Ior lack oI a
3 better word, hold our hands through the transaction.
4 Q. What did JP Morgan do?
5 A. All encompassing Irom working with data tapes, determining
6 which loans qualiIied Ior the securitization, working as the
7 main go-between the Monoline Insurance Company and Flagstar and
8 the go-between the rating agencies and Flagstar. They pretty
9 much orchestrated the entire transaction Ior us.
10 Q. Did you deal directly with JP Morgan?
11 A. Yes, I did.
12 Q. Did you have a contact with at JP Morgan?
13 A. Yes, I did. My contact was Paul white.
14 Q. Let's turn to your roles with respect to the
15 securitizations at issue here. You mentioned that component oI
16 your role was assessing the economic implications. What do you
17 mean by that?
18 A. As the securitization was executed, we had to determine
19 just what the accounting entries that were associated with it
20 were, what the impact on Flagstar's Iinancial statements,
21 balance sheet and income statement would be, and calculating
22 those interests that we retained oI the securitization.
23 Q. What were those interests?
24 A. Commonly reIerred to as a residual interest, it is
25 eIIectively the net cash Ilow leIt over aIter all oI the other
1 participants in the securitization have been satisIied. You
2 might say almost an equity interest in the securitization.
3 Q. Does equity interest mean that Flagstar invested equity
4 into the securitization?
6 THE COURT: Ground?
7 MR. BUCHDAHL: Again leading, your Honor.
8 THE COURT: No. I'll allow it.
9 A. Flagstar didn't directly inject equity. It was kind oI a
10 byproduct oI the structure. There were more loans sold into
11 the securitization than notes issued. That created an
12 over-collateralization. There was over a building oI the
13 over-collateralization over time.
14 All oI these things were contained in the
15 securitization until search conditions were met and only aIter
16 that point Flagstar got any oI the beneIits oI the
17 securitization. There was a Iair amount oI cash that was
18 actually trapped in the securitization until the end, and that
19 eIIectively represents our equity injection into this
20 structure.
21 Q. What was Flagstar's compensation Ior the loan contribution?
22 A. We didn't receive any compensation up Iront. Again the
23 compensation was going to be this residual interest that we
24 retained and would ultimately have received cash Ior this
25 residual interest as the securitization wound down.
1 Q. What is the signiIicance, iI any, oI Flagstar's maintaining
2 an equity ownership oI the securitizations?
3 A. Again I think there were several. Probably the most
4 signiIicant Irom the rating agencies and other participants was
5 it really demonstrated that Flagstar had skin in the game and
6 again we weren't going to receive any cash out oI the
7 transaction unless it perIormed in accordance with
8 expectations.
9 Q. What do you mean by skin in the game, Mr. Jursek?
10 A. Again our interests in the securitization were behind other
11 participants in it, and again iI there were losses to be taken
12 in the securitization, Flagstar would be the Iirst entity to
13 take those losses. Again it showed we had an economic interest
14 in that securitization perIorming.
15 Q. Did Flagstar's equity participation diIIer in the 2006-2
16 securitization?
17 A. No. It was eIIectively the same. Some oI the
18 over-collateralization levels diIIered, but it was still the
19 same basic concept.
20 Q. Who was charged with valuing the residual interest in the
21 2005-1 deal?
22 A. My department was.
23 Q. Is it the same Ior 2006-2?
24 A. Yes, it was.
25 Q. Who was responsible Ior building the economic model to
1 value that residual interest?
2 A. My department did or was responsible Ior it. I relied
3 heavily on JP Morgan in the construction oI the model. I would
4 characterize it as working alongside oI them to develop the
5 model. By the time the transaction closed, it was something
6 that was turned over Irom my group to use going Iorward.
7 Q. What makes up the residual interest?
8 A. When you think about the structure oI a securitization, you
9 have the collateral, which in this case are the HELOC loans,
10 and there is cash coming into the transaction Irom that
11 collateral, be it interest and principal payments, and then
12 there is the notes that are issued that are using the
13 collateral as security.
14 In this case, we had publicly issued notes and you
15 have the incoming cash Ilows Irom the collateral, you have the
16 outgoing cash Ilows Irom the note holders, the payments to the
17 note holders.
18 You have payments to the trustee, to the loan
19 servicer, to the Monoline insurer. At the end oI all those
20 cash Ilows there was either a net positive cash or net negative
21 cash, and that positive or negative cash would have been
22 commonly reIerred to as the residual interest.
23 Q. Can you describe the structure oI the 2005-1 transaction as
24 it relates to the order oI interest?
25 A. Again as I stated, Flagstar was at the very bottom oI the
1 order. It is commonly reIerred to as the waterIall in the
2 transaction. At the top oI the waterIall, those are the people
3 that get paid Iirst based on a prioritization. That would be
4 the externally-issued securities and interest and principal on
5 those securities.
6 Second would have been participants in the structure
7 such as the trustee and the loan servicer. Ultimately any
8 claims Irom the insurer, contributions would have been paid
9 oII. Again Flagstar was at the very bottom oI that waterIall
10 or prioritization.
11 Q. What does that mean, to be at the bottom oI the waterIall?
12 A. Basically that means as long as there is any outstanding
13 amounts due anybody, be it the Monoline insurer, be it the
14 trustee. Flagstar would not receive any cash out oI the deal.
15 Q. Did Flagstar have an interest in these securitizations
16 perIorming?
17 A. Absolutely. We had that eIIective equity injection in it,
18 and that was at risk Irom the start oI the transaction.
19 Q. Other than the residual interest, did Flagstar have any
20 other ownership interest in securitizations?
21 A. There is another ownership interest commonly reIerred to as
22 transIeror's interest that we ended up as a result oI the
23 structure as well.
24 Q. What is a transIeror's interest?
25 A. TransIeror's interest is a mechanism that allows the trust
1 to eIIectively wind down over time. Once it has reached a
2 certain period oI time or to the extent negative perIormance
3 has been reached and certain thresholds oI negative perIormance
4 was reached, it enters into what is called the rapid
5 amortization period.
6 When it enters into that rapid amortization period,
7 all cash Ilows Ior new draw that are Iunded on the HELOCs are
8 Iunded by Flagstar, and all payments oI principal go directly
9 to the note holders. It eIIectively Iorces the amortization oI
10 the securitization structure and brings it to a close as
11 expediently as possible.
12 Q. Was rapid amortization declined in this case?
13 A. Yes, it was, it was because oI credit events that caused
14 the rapid amortization to be cleared.
15 Q. What was the purpose oI the transIeror's interest,
16 Mr. Jursek?
17 A. Again, two diIIerent purposes. I think one is the orderly
18 dissolution oI the structure over time. The second is that it
19 adds an element oI additional credit support primarily on
20 behalI oI the Monoline Insurance Company. That wrapped the
21 deal.
22 Q. What happens when Flagstar starts Iunding all the draw?
23 A. EIIectively there becomes a dual ownership oI the
24 collateral, with Flagstar owning a pro rata portion oI the
25 collateral in the deal. We participate in the perIormance oI
1 that collateral, sharing in the interest receipts and losses on
2 a pari passu basis, but again that receipt oI the principal
3 will only be realized by Flagstar to the extent everybody else
4 has been satisIied in the waterIall.
5 Q. When did Flagstar start calculating or valuing the
6 transIeror's interest in the two deals?
7 A. It would have been right aIter the rapid amortization event
8 was declared. I believe it was in early 2008 Ior the 2005-1
9 and I believe late 2007 Ior the 2006-2 deal.
10 Q. Mr. Jursek, how is the transIeror's interest valued?
11 A. It is valued very similarly to the residual interest.
12 Again it is a net present value oI the cash Ilows, and
13 any cash Ilows that are leIt over at the end oI the deal
14 represent interest that Flagstar has, and it is expressed as a
15 net present value concept, very much like residual.
16 Q. Are there critical assumptions taken to come to that
17 valuation?
18 A. Yes, eIIectively the same critical assumptions, you know,
19 that go into the residual would aIIect the value oI the
20 transIeror's interest. There is going to be an interest rate
21 assumption, there is going to be a prepayment assumption.
22 There is going to be a loss Iorecast. All oI those Iactors are
23 going to impact the transIeror's interest.
24 MS. SHIN: Your Honor, may I approach?
25 THE COURT: Yes.
1 (Pause)
2 BY MS. SHIN:
3 Q. Mr. Jursek, do you recognize this document?
4 A. Yes, I do.
5 Q. What is it?
6 A. It is Flagstar's 10-q.
7 Q. What date?
8 A. This would have been Ior the June 2012 Iiling period.
9 Q. Is this the most recent 10-q available at this time.
10 A. At this time, yes.
11 Q. Is this a publicly-Iiled document?
12 A. Yes, it is.
13 MS. SHIN: I move to admit this exhibit into evidence.
14 MR. BUCHDAHL: Subject to a showing oI relevance, your
15 Honor, no objection.
16 THE COURT: Received, subject to connection.
17 (DeIendant's Exhibit BAS received in evidence)
18 BY MS. SHIN:
19 Q. Mr. Jursek, can you turn to the tab page in this document.
20 A. Yes.
21 Q. This I believe is Page 57. Do you see at the bottom where
22 it says, "transIeror's interest"?
23 A. Yes.
24 Q. Are you there, Mr. Jursek?
25 A. Yes, I am.
1 Q. Would you read the last Iew sentences under, "TransIeror's
2 interests" in the record.
3 A. "Under the terms oI the HELOC securitization, the trusts
4 have purchased and were initially obligated to pay Ior any
5 subsequent additional draw on the lines oI credit transIerred
6 to the trust. Upon entering a rapid amortization period, the
7 company becomes obligated to Iund the purchase oI those
8 additional balances as they arise in change Ior a beneIicial
9 interest in the trust (transIeror's interest) the company must
10 continue to Iund required purchase oI additional draw by the
11 trust Ior as long as the securitizations remains active. The
12 table below identiIies the draw conclusions Ior each oI the
13 HELOC securitizations trusts as well as the Iair value oI the
14 transIeror's interest."
15 Q. Mr. Jursek, did you have any hand in the preparation oI
16 this table?
17 A. Yes, I did.
18 Q. To date, how much has Flagstar Iunded in draw Ior the
19 2005-1 trust?
20 A. Just under $36 million.
21 Q. That is as oI June 30, 2012?
22 A. Correct.
23 Q. What is the additional balance increase amount?
24 A. Again as I described the transaction earlier, Flagstar
25 participates in the perIormance oI those, oI the collateral on
1 a pari passu basis, so the diIIerence between the total draw
2 that have been contributed and the additional balance increase
3 amount is the eIIective pro rata share oI the losses on the
4 collateral that Flagstar absorbed. That is eIIectively the
5 Iace value oI the transIeror's interest is the $25.9 million.
6 Q. What is the Iair value oI the transIeror's interest?
7 A. At this date, the Iair value is $7.66 million.
8 Q. Why is the Iair value less than the additional balance
9 increased amount?
10 A. Several Iactors: One is again it is the net present value
11 oI all the cash Ilow on the transIeror's interests that are
12 expected to be around at the end oI the deal.
13 There are expected credit losses that are going to be
14 absorbed by that $25.9 million, and that $7.6 million
15 represents the amount that is going to be the present value oI
16 the amount that is expected to be leIt at the end oI the
17 transaction.
18 Q. How much credit support is there currently in the 2005-1
19 trust?
20 A. Currently there is $25.9 million oI additional credit
21 support.
22 Q. How much has Flagstar Iunded in draw Ior the 2006-2 trust
23 as oI June 30, 2012?
24 A. $51.2 million, $51.3 million.
25 Q. What is the amount oI the additional balance increase
1 amount?
2 A. $28.8 million.
3 Q. So the amount oI loss, iI you subtract 51.2 by 28.8 is?
4 A. That would be our pro rata share oI the losses we paid on
5 the deal so Iar.
6 Q. Is there any book Iair amount Ior transIeror's interest Ior
7 2006-2?
8 A. Not at this time. That was all written oII.
9 Q. What does the 28.8 million additional balance increase
10 amount, basic amount represent Ior the 2006-2 trust?
11 A. That is eIIective credit support that is in the deal at
12 this time.
13 Q. Does that mean that any amounts that are still in the
14 account at the end will be turned over to Assured?
15 A. Yes, Flagstar would IorIeit any dollars that are still
16 active in that account.
17 Q. Altogether, how much has Flagstar contributed in draw
18 Iundings in addition to the initial over-collateralization we
19 just talked about?
20 A. It looks to be a little over $86 million.
21 Q. Just so we're clear, how is the transIeror's interest
22 diIIerent Irom Flagstar's residual equity interest?
23 A. It's diIIerent in that we receive interim interest payments
24 on our pro rata share oI the collateral. It is similar in that
25 the return oI the principal is still subordinated to everybody
1 else in the trust just as it is at the bottom oI the waterIall
2 Irom the principal perspective.
3 Q. You mentioned pro rata share. Who are the other owners oI
4 the securitization trust?
5 A. Flagstar is the only owner oI the securitization trust.
6 Q. What is Flagstar's share?
7 A. Our share is going to be 23 to 25 percent oI the underlying
8 collateral. When I am reIerring to pro rata share, I am
9 reIerring to the share oI the collateral, basically the trust
10 and Flagstar now shares that collateral.
11 Q. Is that pro rata share growing?
12 A. Yes, the rapid amortization is going to a mandate that all
13 principal payments go to the beneIit oI the note holders and
14 all draw are Iunded by Flagstar. Ultimately Flagstar's
15 ownership in the collateral pool will approach a hundred
16 percent as the deal winds down.
17 Q. What, iI any, is the signiIicance oI Flagstar booking an
18 asset Ior the transIeror's interest Ior 2005-1?
19 A. For the 2005-1, the Iact that there's any positive value
20 that we're carrying on our books implies that all the other
21 parties in the securitization have been made whole Ior that
22 deal.
23 Q. Is Flagstar's transIeror's interest valuation report in the
24 10-K?
25 A. It is.
1 Q. As we have seen, it is reported in the 10-q's?
2 A. Correct.
3 Q. It is booked as an asset Ior 2005-1?
4 A. Yes, it is.
5 Q. Is the transIeror's interest valuation Ior 2005-1 trust
6 audited?
7 A. Yes, it is.
8 Q. Who audited the transIeror's interest valuation?
9 A. Our external auditors.
10 Q. Mr. Jursek, how, iI at all, were you involved in the loan
11 selection process Ior the trusts at issue in this litigation?
12 A. My department, as I said, played a large role in the
13 initial working with data. We were basically the primary
14 go-between JP Morgan and Flagstar as it relates to the raw
15 data. We were trying to make sure that loans that were in the
16 securitization qualiIied as securitization candidates and that
17 we had eIIective data Ior all oI those loans that were in the
18 transaction as well.
19 MR. BUCHDAHL: II I may, we got a lot oI objections
20 during our Iirst witness based on lack oI personal knowledge
21 because we put on the head oI the department, and argument was
22 made that he wasn't personally involved in some oI these things
23 that he wanted to testiIy about.
24 Mr. Jursek's testiIied that he is the head oI the
25 department responsible Ior a number oI things, including the
1 valuation oI these transIeror's interest and that he is the
2 head oI the department that was responsible Ior loan selection,
3 but I haven't seen any Ioundation suggesting he was personally
4 involved in these things. So I would object to some oI the
5 testimony we have already heard and this new line oI
6 questioning based on lack oI personal knowledge subject to us
7 hearing something diIIerent about the value oI these things.
8 MS. SHIN: I can ask him iI he was personally
9 involved.
10 THE COURT: BeIore you get to that, Iirst, whatever
11 objections were made previously were made in terms oI the
12 speciIic questions raised and may or may not carry over here.
13 Second, I think in the normal course really we don't
14 need a lengthy speaking objection oI that sort and it is enough
15 to say, "Objection. Lack oI personal knowledge."
16 Sustained. Put another question.
17 BY MS. SHIN:
18 Q. Can you describe your personal involvement, iI any, in the
19 loan selection process?
20 A. As I stated, I actually do have Iairly extensive sequel
21 coding abilities and worked with our analysts in the
22 development oI this data tape. Again it was a departmental
23 project that I was ultimately responsible Ior and we did
24 assemble that data tape, eIIectively provided, provided the
25 Iirst cut oI data to JP Morgan, and that included virtually our
1 entire HELOC population. Again their Iirst goal was to whittle
2 it down to the appropriate loans that would make appropriate
3 securitization candidates.
4 MR. BUCHDAHL: Objection, your Honor.
6 BY MS. SHIN:
7 Q. How long did that loan selection process take, Mr. Jursek?
8 A. It was a very extensive time-Irame that we worked with JP
9 Morgan. I recollect it taking at least a year, over twelve
10 months worth oI back and Iorth by the time we Iinally made it
11 to the end oI the securitization process.
12 Q. Why did it take so long?
13 A. Again as we identiIied earlier, this was Flagstar's Iirst
14 non-agency securitization. There were signiIicant issues as
15 Iar as data availability, and it wasn't data that, the type oI
16 data needed to support the securitization, wasn't the type oI
17 data we routinely stored. We had to assemble it and search it
18 out and basically make sure all the data existed.
19 Q. You mentioned early there was a whittling down or
20 qualiIying process?
21 A. Right.
22 Q. Would you take us through that whittling down process.
23 A. Right. As I stated, we gave JP Morgan virtually our entire
24 set oI home equity loans at the time. We really weren't aware
25 oI what would qualiIy as good securitization candidates and
1 went through the process oI knocking loans out oI the
2 securitization over the next period.
3 Q. The Iirst step was to show JP Morgan the entire inventory
4 oI HELOCs?
5 A. Correct.
6 Q. Were there any economic beneIits to Flagstar to cherry-pick
7 loans to keep on its book or to sell?
10 BY MS. SHIN:
11 Q. How was this whittling process done?
12 MR. BUCHDAHL: Objection, your Honor; lack oI personal
13 knowledge.
14 THE COURT: I think given his answer to the earlier
15 aspects, it seems that he has extensive personal knowledge oI
16 virtually every aspect oI this, so I will allow it. You may
17 cross iI you think there are aspects oI that he doesn't have
18 personal knowledge oI, but I will allow it Ior now. You may
19 answer.
20 THE WITNESS: Would you repeat the question.
21 BY MS. SHIN:
22 Q. How was this whittling-down process done?
23 A. Okay. Loans that were clearly not candidates Ior
24 securitization were removed, again examples would be loans that
25 had delinquency, current delinquency status or some sort oI
1 history oI delinquency. We also had several loans, batch oI
2 loans that were not underwritten using our automated
3 underwriting system.
4 Again those were Ielt not to be appropriate
5 securitization candidates.
6 THE COURT: Now actually now I do want to Iollow up
7 when I hear that on plaintiII's objection.
8 Who is making these determinations?
9 THE WITNESS: This would have been JP Morgan.
10 THE COURT: Do you know the basis on which they were
11 making it?
12 THE WITNESS: Just discussing the content oI the data
13 and going back and Iorth discussions on the data content.
14 THE COURT: With whom?
15 THE WITNESS: Primarily my department and myselI and
16 my analysts and JP Morgan, analysts at JP Morgan.
17 THE COURT: Are you talking to JP Morgan or are you
18 talking to your Iolks, who are talking to JP Morgan?
19 THE WITNESS: Both took place, a lot oI discussions
20 between myselI and JP Morgan, a lot with my analysts.
21 THE COURT: Give me an example oI the kind oI
22 discussions you had with JP Morgan.
23 THE WITNESS: We were in constant communication. They
24 would ask questions about the data tape, what the loans
25 represented, identiIying, Ior instance, what is a delinquent
1 loan, how do we identiIy a delinquent loan and having that type
2 oI discussion, what about that type identiIied delinquency. Is
3 there something that identiIies past delinquencies loans, those
4 were very typical conversations.
5 THE COURT: With some caution as to how much weight I
6 may give to is, I will allow it. Continue.
7 BY MS. SHIN:
8 Q. Mr. Jursek, you gave JP Morgan a loan tape?
9 A. Correct.
10 Q. Did you give JP Morgan a loan tape?
11 A. Yes, we did.
12 Q. What inIormation was on that initial loan tape?
13 A. There would have been, in my recollection, 50 to 75 Iields
14 oI inIormation, inIormation about the borrower, name, address,
15 items such as collateral value, debt burden that the borrower
16 would have, Iactors such as loan-to-value, all the basic
17 inIormation that would be required to make an underwriting
18 decision was eIIectively on that tape.
19 Q. Was income on that tape?
20 A. Yes it was.
21 Q. DTI?
22 A. Yes, it was.
23 Q. Assets?
24 A. Yes.
25 Q. Any co-borrowers?
1 A. II there were co-borrowers, yes.
2 Q. Credit scores?
3 A. Yes, there would have been.
4 Q. Were Flagstar's underwriting deadlines provided to JP
5 Morgan?
6 A. Yes, they were.
7 Q. Were they provided to anyone else?
8 A. They would have been provided to all oI the constituencies
9 oI the securitizations. They would have been provided to the
10 rating agencies, to JP Morgan, the Monoline insurer, all oI
11 those parties would have had access.
12 Q. Sticking with JP Morgan, what do you understand JP Morgan
13 did with the loan tape?
14 MR. BUCHDAHL: Objection; relevance.
15 THE COURT: The objection is relevance?
16 MR. BUCHDAHL: I have a back-up, too, your Honor.
17 THE COURT: Let me hear your back-up.
18 MR. BUCHDAHL: The back-up is this witness would not
19 have a personal knowledge what JP Morgan did review. I believe
20 there is no relevance what JP Morgan did with the loan tape.
21 THE COURT: The question, however, was not directed on
22 when JP Morgan did with the loan tape, which would be
23 objectionable on grounds oI hearsay also.
24 MR. BUCHDAHL: RespectIully, your Honor, I believe
25 that was the question.
1 THE COURT: No, it wasn't. The question was do you
2 have an understanding oI what JP Morgan did? Was that not the
3 question?
4 "What do you understand JP Morgan did with the loan
5 tape?"
6 So the question is, is his understanding oI relevance
7 at issue in this case which is why I hesitated, respectIully.
8 I think the objection is sustained.
9 BY MS. SHIN:
10 Q. What do you understand JP Morgan had instead oI data
11 validation edits?
14 BY MS. SHIN:
15 Q. What did JP Morgan want to know Irom you, Mr. Jursek?
18 MR. BUCHDAHL: Lack oI personal knowledge as to what
19 JP Morgan wanted to know.
20 THE COURT: Well, yes. I think it is really an
21 objection as to Iorm, but sustained.
22 BY MS. SHIN:
23 Q. Was there an internal data validation process requirement?
24 A. We did a Iair amount within my department, trying to
25 identiIy data deIiciencies, data gaps. Again we worked very
1 closely with JP Morgan all through that process as Iar as what
2 types oI internal calculations should be consistent.
3 An example would be collateral value, iI you identiIy
4 the collateral and then the loan amount and then recalculate
5 loan-to-value and make sure that the data was internally
6 consistent, and we spent a lot oI time going through those
7 types oI processes.
8 THE COURT: I am sorry. I am missing something.
9 These were mortgage loans, yes?
10 THE WITNESS: Second mortgage home equity loans.
11 THE COURT: Yes. That is a subset oI mortgage loans?
12 THE WITNESS: Yes.
13 THE COURT: And as I understand it, you, Flagstar, had
14 not been involved in those loans previously or Flagstar had not
15 been involved in securitizing those loans previously or what?
16 What was the reason? What was it that Flagstar had
17 not been involved in that caused Flagstar to --
18 THE WITNESS: Flagstar had not been involved in the
19 securitization oI those loans historically.
20 THE COURT: And you had Iamiliarity? Had Flagstar, to
21 your knowledge, had Iamiliarity to those loans in other
22 respects?
23 THE WITNESS: Yes, we did originate loans and invested
24 in them directly on our balance sheet, just not through
25 securitizations.
1 THE COURT: The loans that were going to be made here,
2 iI someone applied Ior a mortgage loan that was going to be
3 used as a securitization, to whom would they apply?
4 THE WITNESS: The same channels that our regular,
5 more --
6 THE COURT: No. To Flagstar?
7 THE WITNESS: To Flagstar, correct.
8 THE COURT: And Flagstar Ior that purpose would treat
9 them the same as they had historically treated other such
10 loans?
11 THE WITNESS: Correct.
12 THE COURT: The special Iurther aspects oI
13 securitization had nothing to do with who would qualiIy Ior
14 such a loan, did it?
15 THE WITNESS: It wouldn't impact the qualiIication.
16 It would impact the data that was required to support
17 it. Again data that was required to support a securitization
18 had to be in particular Iormats and particular availability.
19 It wasn't uncommon Ior there to be a diIIerence between the
20 type oI data that supported the decision to put it on our
21 balance sheet and --
22 THE COURT: Would someone who would not qualiIy to get
23 a HELOC loan Irom Flagstar in the ordinary course qualiIy iI it
24 was connected to a securitization?
25 THE WITNESS: I think it would more likely be the
1 other way around.
2 THE COURT: They would have to be higher standards?
3 THE WITNESS: Typically.
4 THE COURT: All right. So with respect to the
5 standards that would have to be met in the normal course,
6 Iorget about securitization or HELOC loan, are you Iamiliar
7 with those standards?
8 THE WITNESS: Yes.
9 THE COURT: Did you in your career ever, were you ever
10 at the level where you gave or where you were the person at the
11 intake?
12 THE WITNESS: No.
13 THE COURT: No? So your Iamiliarity is through having
14 supervised others or through the company being Iamiliar with
15 company guidelines and policies, or what?
16 THE WITNESS: Being Iamiliar with company guidelines
17 and policies.
18 THE COURT: Let's take the case, there were loans
19 where I think they're called stated income loans. Are you
20 Iamiliar with those?
21 THE WITNESS: Generally, yes.
22 THE COURT: Well, tell me what those, as you
23 understand it, what those were?
24 THE WITNESS: What stated income loans are?
25 Stated income loans would be loans that were by the
1 borrower. It basically represented what their income was.
2 THE COURT: The borrower would come in and tell you.
3 The loan oIIicer would have them Iill out the Iorm and sign it
4 and that his or her income was X, right?
5 THE WITNESS: That is my understanding.
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Camrass4 Jursek - direct Page 830
1 THE COURT: Why is that diIIerent Irom any other
2 mortgage loan?
3 THE WITNESS: Stated income versus nonstated income is
4 the question?
5 THE COURT: Yes.
6 THE WITNESS: My understanding is that in a nonstated
7 income, the income is actually veriIied as part oI the under-
8 writing process.
9 THE COURT: Here it wasn't veriIied?
10 THE WITNESS: No, I'm not saying that at all. Again,
11 I wasn't part oI the --
12 THE COURT: I'm asking, what is the diIIerence between
13 the two? II you don't know, you don't know. I'm asking what
14 is the diIIerence between --
15 THE WITNESS: I told you generic --
16 THE COURT: -- between a stated loan and a nonstated
17 loan?
18 MS. RENDON: Your Honor, iI I may?
19 THE COURT: No, you may not.
20 What is the diIIerence between a stated loan and a
21 nonstated loan?
22 THE WITNESS: The nonstated loan would have the income
23 veriIied as part oI the underwriting process.
24 THE COURT: And the stated loan would not have it
25 veriIied?
1 THE WITNESS: It would not be explicitly veriIied.
2 THE COURT: II someone came in and said, I'm making
3 $50,000 a month, in the normal course no action would be taken
4 to veriIy that?
5 THE WITNESS: I guess I'm not an expert on the
6 underwriting practices. I do know that they all went through
7 our underwriting process and our normal underwriting engine. I
8 don't know what the underwriting department would do.
9 THE COURT: Your expertise or your Iamiliarity is with
10 what would happen, what additional requirements there might be,
11 iI these were to qualiIy Ior part oI a securitization, yes?
12 THE WITNESS: I knew that they were approved by our
13 automated underwriting system. The details oI that approval
14 I'm not really --
15 THE COURT: Now I'm talking about what it is that you
16 do know, which is what? What is it? II they were going to
17 part oI a securitization, I think you told me there might be
18 additional steps.
19 MS. RENDON: Yes. They would have had to have been
20 approved by our automated underwriting system.
21 THE COURT: I understand that. Then what happens?
22 THE WITNESS: Then they would show up on the list oI
23 potential loans that were candidates Ior securitization.
24 THE COURT: Then what? Is anything else required?
25 THE WITNESS: That started the whole process as Iar as
1 the date oI validation and the data edits. It basically
2 started that whole process.
3 THE COURT: What do you mean by data valuation data
4 editing?
5 THE WITNESS: Data validation. That's making sure
6 that we had all the data assembled and in a Iormat that was
7 appropriate to pass on to rating agencies.
8 THE COURT: Data you already had Irom your normal
9 review?
10 THE WITNESS: Data that we would have had in our
11 normal review, data that wasn't always readily available in the
12 Iorm and the location where you might expect it to be.
13 THE COURT: What would be an example oI the latter?
14 THE WITNESS: An example oI the latter would have been
15 I know there were some loans that were underwritten that had an
16 approval, but the details on income were not evident in the
17 Iirst data that was pulled Irom our data warehouse, and we had
18 to go back to the actual underwriting system to Iind the
19 appropriate income Iield.
20 THE COURT: Meaning you didn't add data, you just went
21 back and Iound data already existing and added it, is that
22 right?
23 THE WITNESS: Yes. It would have been diIIerent
24 sources. We started with the data warehouse, which was --
25 THE COURT: I'm having a tremendous problem. This is
1 all very vague in your description. Forgive me. It's not your
2 Iault. It is the Iault perhaps oI my questions. You have a
3 HELOC loan that has been approved Ior origination.
4 THE WITNESS: Right.
5 THE COURT: Now it's being considered Ior inclusion in
6 a pool used Ior securitization, yes?
8 THE COURT: You Iind that some oI the data that you
9 need is not in the immediate printout, in the immediate
10 computerization Iorm that is given to the securitization
11 people?
12 THE WITNESS: Correct. We have diIIerent systems.
13 One is a loan servicing system. The other would be a loan
14 origination system. The primary source oI the original data
15 was the loan servicing system, as these loans were all on the
16 loan servicing system. What we did Iind was that there was at
17 times data that wasn't on the loan servicing system. We had to
18 look elsewhere Ior it.
19 THE COURT: That's what I'm having trouble with. When
20 you say you have to look elsewhere, do you mean elsewhere in
21 the data you already had within the bank or do you mean going
22 outside the bank?
23 THE WITNESS: Data that was already existing in the
24 bank. DiIIerent systems that don't eIIectively talk to each
25 other is what it amounts to.
1 THE COURT: Now I understand. Now my question is,
2 what is the relevance oI this testimony?
3 MS. SHIN: The relevance is that there were a number
4 oI versions oI the loan tape that took over a whole year oI
5 time up through the close oI the transactions, and through that
6 period loans came out, loans were eliminated. Mr. Jursek is
7 just testiIying about that process.
8 THE COURT: I don't see the relevance oI that process.
9 The allegation here is that in the origination oI these loans
10 the guidelines were not Iollowed or there were errors,
11 omissions, etc. This process that he has just described didn't
12 include any new data, didn't include any new checks.
13 It just meant, as he I think, in a way that even this
14 dumb judge understands now, it meant taking data Irom one
15 database and putting it in a Iorm that was usable in another
16 database. But the loan origination process didn't change, the
17 validity oI the loans so Iar as the data known to the bank
18 didn't change. So what is the relevance?
19 MS. SHIN: I guess there are a couple oI things. The
20 implication Irom Matt Roslin's testimony was that Flagstar was
21 originating these loans to sell them or dump them and that it
22 carelessly put mortgages into these trusts without regard to
23 quality or process. Mr. Jursek's testimony reIers to a process
24 where there was careIul analysis and selection.
25 THE COURT: The analysis and selection was only as
1 good or not as good as the data originally obtained. Again,
2 you can maybe convince me otherwise, but as I understand it,
3 the situation is this. Our loan originators obtained whatever
4 data they obtained. II you then take that data and you
5 transIorm it, you massage it, you put it into diIIerent
6 categories, you make selections based on aspects oI the data,
7 none oI that says anything about whether the original data
8 obtained was in accordance with the guidelines and/or had clear
9 errors, omissions, etc. I'm still Iailing to see the point oI
10 this.
11 MS. RENDON: Your Honor, iI I may. I think this is
12 one oI the bricks in the building that we are building. Mr.
13 Jursek is speaking Irom Flagstar's point oI view as to how the
14 data tape was constructed, that it contained 60 to 70 diIIerent
15 data points, I believe his testimony was, all oI the items that
16 would go into the underwriting oI a loan.
17 What you will see in the deposition testimony that's
18 been designated Ior your Honor is that that very same loan data
19 tape was provided to Assured, what Assured did with that loan
20 data tape was put it into their Access model. This was the
21 modeling that I was talking about beIore that Mr. Stiehl is
22 going to testiIy to that your Honor will see.
23 What you will see is that Assured ran loan-by-loan
24 analyses on that inIormation, that they also did stratiIi-
25 cations on portIoliowide bases, and that they did so so they
1 could understand the nature oI the collateral and the quality
2 oI the collateral that was coming into the securitization Ior
3 determining whether or not they deemed it too risky a
4 transaction Ior them to insure or a proper transaction Ior them
5 to insure within their risk parameters.
6 THE COURT: First oI all, that arguably is closer to
7 the mark than what I am hearing Irom this witness, but I'm not
8 sure even that is relevant.
9 MS. RENDON: II I may just say one more sentence that
10 might help your Honor?
11 THE COURT: Yes.
12 MS. RENDON: One oI the things that you will also hear
13 testiIied to by both Mr. Beard and Mr. Stiehl and Mr. Williams
14 is that part oI the due diligence that was perIormed at the
15 loan level originally by Clayton & Bohan to third-party
16 diligence Iirms was that not only did they reunderwrite to
17 Flagstar's underwriting guidelines, not only did they grade it
18 to FSA's or Assured's grading system, part oI their assignment
19 was also Ior the loans they sampled, which was a random
20 representative sample, to go back and check the inIormation on
21 a loan Iile basis to the loan data tape to ensure that there
22 was accuracy in the inIormation on the loan data tape, to help
23 give Assured conIidence that the inIormation that they were
24 reading and reviewing and coming to understand about the
25 quality oI the collateral could be inIerred Irom the loan data
1 tape, at least based upon the sample compared to the integrity
2 oI the data.
3 I think part oI what Mr. Jursek is doing is Irom
4 Flagstar's perspective, and we have gotten I think kind oI
5 stuck in how the data was pulled, testiIying to the depth oI
6 the inIormation and the Iact that the data tape came Irom
7 Flagstar and went over to Assured as part oI this process oI
8 demonstrating how Assured did come to understand the
9 collateral, approve the collateral, and it was demonstrative oI
10 being within their risk parameters.
11 THE COURT: II you enter into a contract that requires
12 the other side to do certain things, namely, adhere to its
13 guidelines, and also allocates risk iI it turns out through no
14 one's Iault that someone lied to obtain a mortgage, you bear
15 the risk, not us, does the Iact that you then undertake some
16 due diligence beIore you enter into the contract mean that you
17 waive your right to assert that the contract was breached iI
18 you later discover that either the guidelines were Iollowed or
19 that, through no one's Iault, the loans were procured through
20 Ialse statements?
21 MS. RENDON: We did make some argument along those
22 lines. I understand your Honor denied that on summary
23 judgment. I think at this point the reason why this evidence
24 is coming in is Ior a wholly diIIerent purpose. It is
25 probative oI whether or not the collateral was compliant Irom
1 day one.
2 In other words, now we're talking about was this loan
3 collateral-compliant with underwriting guidelines, was it
4 violative oI underwriting guidelines, was it within the risk
5 parameters oI Assured at the date oI the timing oI the closing
6 oI the transaction.
7 What all this demonstrates is that Assured's own due
8 diligence and the length and look that it gave was oriented
9 towards Iiguring out that exact question and the time period
10 that even Ms. Walzak says is the relevant time period.
11 THE COURT: Even assuming Ior the sake oI argument Ior
12 the moment that that was relevant, what does this witness add
13 to that?
14 MS. RENDON: Your Honor, what he testiIied to earlier
15 in his testimony on a diIIerent subject, I'll come back to that
16 iI you want. On this particular he is simply talking about the
17 construction oI the loan data tape, which was one Iorm oI how
18 Assured came to understand the collateral and whether or not it
19 was compliant with underwriting guidelines, with their risk
20 parameters, and their own review oI the collateral.
21 I do think that the Iact that it came back aIter the
22 data integrity itselI was conIirmed through their due
23 diligence, that Iile-level review oI integrity oI data, it
24 would demonstrate that the issue oI these loans was not that
25 there were these pervasive breaches that Assured is now
1 claiming is the case, rather that there was this third Iorce
2 that occurred called the economy that caused these loans to go
3 sour. The Iact that there was this in-depth look and the Iact
4 that there were no issues Iound through that in-depth look
5 would be demonstrative oI the quality oI the collateral.
6 THE COURT: Let me hear Irom plaintiII's counsel.
7 MR. BUCHDAHL: Your Honor, I'm going to begin with
8 that last part, because that goes squarely against the summary
9 judgment ruling. What they say is now what caused these losses
10 is that the economy went south. That couldn't be Iarther Irom
11 what we need to prove, and it has also already been rejected by
12 the Court.
13 What we need to prove is that they are obligated under
14 the contract to repurchase loans because those loans breached
15 the representations and warranties. It's not loss causation
16 the way they are talking about. That's already been rejected,
17 as I understand it, pretty squarely in the Court's opinion.
18 THE COURT: I must admit that I contributed to a
19 little conIusion there with some oI my comments last week. But
20 I think that is correct, what you say. II, because oI
21 noncompliance with the guidelines or other things covered by
22 the representations and warranty, Assured would have rejected
23 these loans, then the Iact that the loans ultimately went south
24 Ior some other hypothetical reason is neither here nor there.
25 I said that in the summary judgment and I reaIIirm it here.
1 I apologize iI I have somewhat complicated the issue
2 by some comments. It was the eloquence oI deIense counsel that
3 took me away Irom the straightIorwardness oI this issue.
4 However, what she is saying now, as I understand it,
5 and it may be more than this but it is at least this, is that
6 all the steps that were taken by way oI due diligence by
7 Assured and the people they hired to do it, while not passing
8 the risk, there is circumstantial evidence that Flagstar was
9 doing what its guidelines required, and thereIore it is
10 probative on that issue. Then, this poor witness on the stand,
11 who has had to sit through this endless colloquy, is being
12 oIIered basically to Iill in one oI the steps so you can see
13 how the people who did the due diligence got what they got.
14 MR. BUCHDAHL: Right.
16 MR. BUCHDAHL: There are two aspects to this that
17 counsel shrewdly blended together, but they are actually quite
18 separate. This witness was talking about the construction oI a
19 loan tape, which, as counsel pointed out, is a brick in what we
20 regard as the irrelevant house oI the loss model. The loan
21 tapes are one Iunction.
22 Assured took the loan tape and literally ran it
23 through its computer and it spit out an expected loss Iigure,
24 which we already covered last week, and the Court said what
25 Assured's computer said was an expected loss is not relevant to
1 this case. That is the sole use oI the loan tape.
2 I'll just add that the only thing this witness has
3 conIirmed on that score is essentially garbage in/garbage out.
4 All oI these numbers came Irom Flagstar. More importantly,
5 look at how they got them. II they were to check the data
6 integrity, Ior example, oI our police sergeant Irom Detroit,
7 what they would make sure is that the loan tape said $30,000 oI
8 monthly income Irom Regional Financial Group.
9 THE COURT: Yes, that was the point that I was making
10 a minute ago. Garbage in/garbage out is, oI course, a more
11 traditional way oI expressing it. Even a talking head might
12 use that phrase.
13 MS. RENDON: Your Honor, iI I may respond to that?
14 THE COURT: Yes.
15 MR. BUCHDAHL: I'm not quite through.
16 THE COURT: Go ahead, plaintiII's counsel.
17 MR. BUCHDAHL: That's one step, which is the
18 construction oI the loan tape. Counsel has also brought up the
19 Iile-level due diligence, which we also believe is irrelevant
20 but Ior which there is a diIIerent argument along the lines
21 that you pointed out Ior why it might arguably be probative oI
22 one thing or another, even though we didn't conduct that
23 diligence and even though the results oI it were plainly
24 inadequate.
25 But this witness is talking about the construction oI
1 a loan tape. A lot oI the testimony they want to submit by
2 deposition is talking about the use oI that loan tape in a loss
3 modeling program. That Ior these purposes I think is
4 irrelevant. I'm going to wait and see how the due diligence
5 evidence is presented by counsel beIore I object to that, but
6 this I think is independent oI it and irrelevant.
7 MS. RENDON: Your Honor, iI I may. I understand Mr.
8 Buchdahl is trying to call these loss modeling and then say
9 let's put it over there in a bucket. It's not that easy. I do
10 wish at this point that we were playing some oI the videotape I
11 talked to the Court about, because I think it would demonstrate
12 the evidence I'm articulating now to you.
13 The reality is that Flagstar pulled Irom its loan
14 Iiles and Irom its servicing Iiles inIormation. They created
15 an extensive loan data tape that had 70 Iields oI data and
16 everything you want to know Ior purposes oI underwriting a
17 guideline.
18 In its own due diligence process, FSA determined, by
19 choosing random representative samples -- they had a
20 third-party diligence Iirm go back and conIirm the integrity oI
21 the data on that loan data tape Irom what's in the Iile. Then
22 they ran loan stratiIication data. Mr. Buchdahl characterized
23 it as spitting out a loan expectancy model. It wasn't that at
24 all.
25 Mr. Stiehl will show you by walk-through. There are
1 extensive printouts oI all diIIerent kinds oI loan data on a
2 speciIic loan-by-loan basis oI geographic inIormation, CLTV
3 inIormation, debt-to-income inIormation, all diIIerent types oI
4 understanding and extrapolating Irom that.
5 Ultimately, it was used Ior a purpose oI loss
6 expectancy, but that wasn't so much the Iocus. It's
7 demonstrating the depth at which FSA got its hands down deep
8 into this collateral, was vetting it speciIically because this
9 was Flagstar's Iirst and second transactions in this arena, and
10 they were making sure Irom a risk perspective it was the type
11 oI collateral that they wanted to insure. This is coming out
12 oI the mouth oI David Beard, the head oI the underwriting team.
13 THE COURT: To move things along, what does this
14 witness have to oIIer beyond what we have heard so Iar that
15 bears on anything?
16 MS. RENDON: Your Honor, I agree with you we probably
17 can move Iorward in his testimony that we have a loan data tape
18 that has that type oI data stratiIication, and that it was
19 utilized by JPMorgan Chase and Flagstar to determine the
20 quality oI the collateral Ior submission into the
21 securitization.
22 I think that is really what we were presenting him Ior
23 separate and distinct Irom him talking about the manner in
24 which Flagstar had skin in the game in this transaction Irom
25 day one so they would care about the quality oI the collateral
1 that was going in. They kept an equity interest and weren't
2 paid anything up Iront Ior the securitization, which is not
3 typical in a securitization.
4 They didn't make anything on sales sale. They
5 maintained an equity piece Ior perIormance oI the
6 securitization, showing their own belieI in the quality oI the
7 collateral. So this is not a typical type case, a typical type
8 oI securitization. It is demonstrative oI good collateral
9 going in.
10 Then, to the extent there are issues that are being
11 raised today, one has to question what caused it. We can put
12 that aside iI your Honor doesn't want to hear about it. I
13 think to the extent that the due diligence demonstrates the
14 quality oI the collateral and also the determinations oI risk
15 and materiality that FSA was taking --
16 THE COURT: I'm going to, at least Ior the moment,
17 accept that second area as being a relevant one. Then I think
18 this Iellow really should be no more than Iive more minutes
19 max, because I don't see what else I need to know Irom what has
20 just been proIIered.
21 BY MS. SHIN:
22 Q. Mr. Jursek, did you have any conversations or back-and-
23 Iorth about the contents oI the loan tape with FSA?
24 A. Yes. I had discussions with Dave Beard and his team on
25 that topic.
1 Q. What Iorm did those conversations take?
2 A. They were a variety. Email. They could have been direct
3 conversations. There was any number oI Iorms that discussed
4 the data tape with him.
5 MS. SHIN: Your Honor, may I approach?
6 THE COURT: Yes.
7 MR. BUCHDAHL: We object to this exhibit, your Honor.
9 MR. BUCHDAHL: Hearsay.
10 THE COURT: Let me take a look.
11 What about the hearsay objection?
12 MS. SHIN: Mr. Jursek is copied on this, and he can
13 testiIy as to what was going on during this process.
14 THE COURT: What does that have to do with the hearsay
15 rule?
16 MS. SHIN: It is also a business record, your Honor.
17 THE COURT: II you can qualiIy it as a business
18 record, that would be the only way I think you could get it in.
19 BY MS. SHIN:
20 Q. Mr. Jursek, was this document prepared in the ordinary
21 course oI business?
22 A. Yes.
23 Q. Was it part oI the ordinary course oI business to prepare
24 this document?
25 A. Yes.
1 Q. Was it prepared at or about the time oI the events in
2 question?
3 A. Yes, it would have been.
4 MS. SHIN: I oIIer this exhibit, your Honor.
5 MR. BUCHDAHL: Your Honor, we object. This witness
6 has already talked about the Iact that they had never done this
7 process beIore, it was a completely new process. This is just
8 oII-the-cuII questions back and Iorth, including their own
9 selI-serving prior statement. We don't believe this counts as
10 a business record, and we object as hearsay.
11 Q. BeIore we get to the document, Mr. Jursek --
12 MS. SHIN: I apologize. Withdrawn.
13 THE COURT: Do I understand that, as is typical oI
14 emails, the Iirst chronological item in these two emails is the
15 one at the bottom?
17 THE COURT: You received these and these were
18 questions put to you by Mr. Beard? This is the Iirst email on
19 October 10, 2005, at 10:25 a.m. This is being oIIered to,
20 what, show questions that were put to you? Counsel, is that
21 the purpose oI the lower email?
22 MS. SHIN: That is one oI my purposes, yes.
23 THE COURT: You ought to recognize a leading question
24 when you get one. That clearly cannot be hearsay.
25 MR. BUCHDAHL: It is an admission, your Honor. We
1 don't object to that part.
2 THE COURT: Then there is your response. The Iirst
3 part oI the response is nonsubstantive, near as I can tell, the
4 Iirst paragraph. "Perhaps JeII and I can give you a quick call
5 to discuss tomorrow morning what is/does the availability oI
6 your end look like," thus showing that, like all emails, this
7 one avoids the rules oI grammar. Then there is, "Here is a
8 chart," but that is not being oIIered as part oI the exhibit,
9 correct?
10 MS. SHIN: No, it is not.
11 THE COURT: We are down to the last sentence, assuming
12 this were admissible, "There are no other expenses in the cost
13 basis provided you are correct that no FSA 91 deIerrals took
14 place." What is the relevance oI that?
15 MS. SHIN: This is just going to the level oI detail
16 typical oI FSA's inquiries about the loan tapes, your Honor.
17 Mr. Jursek will testiIy as to a series oI these types oI
18 conversations with FSA with regard to the loan tapes as the
19 versions came through over time.
20 THE COURT: I think this is an ordinary business
21 record, but I don't see its relevance. But since we are
22 spending too much time on this as it is, I will receive
23 Exhibit 54.
24 Just so the record is clear, the Iirst email, the
25 earlier one, is not a hearsay problem. The second one is not a
1 hearsay problem in part oI it because it is not asserting a
2 Iact or it's asserting at best a speculation that they can give
3 them a quick call at some Iuture time.
4 The chart I'm not going to pay any attention to,
5 because it is not included.
6 We are down to "There are no other expenses in the
7 cost basis provided you are correct that no FSA 91 deIerrals
8 took place." Assuming arguendo that that is relevant, its
9 marginal beneIit in advancing the Court's assessment oI the
10 situation approaches zero, but I'll receive it.
11 (PlaintiII's Exhibit 54 received in evidence)
12 BY MS. SHIN:
13 Q. Mr. Jursek, I just handed you an exhibit. PlaintiII's
14 Exhibit 54 bears the Bates number AGM04596930 to 31. Do you
15 recognize this document?
16 THE COURT: I'm sorry. Is this a diIIerent document?
17 MS. SHIN: No, it is the same document.
18 THE COURT: Why are you asking him that, since it is
19 already received?
20 MS. SHIN: I'm sorry.
21 Q. Who is Mr. Beard?
22 A. Mr. Beard would have been at FSA. He was one oI the people
23 that we dealt with in the securitization process.
24 Q. Who is Mr. George Stiehl?
25 A. My understanding is that George was on Dave's team, he
1 reported to him.
2 Q. Who is JeIIrey Dykstra?
3 A. JeII was an analyst that reported to me during the time
4 Irame oI the securitization. He was one oI the analysts that I
5 reIerred to as having data-gathering skills.
6 Q. Mr. Paul White?
7 A. Paul White was our securitization representative at
8 JPMorgan.
9 Q. I direct your attention to Mr. Beard's email, the bottom oI
10 the second page -- or the top oI the second page. Will you
11 please read the email to Mr. Beard into the record.
12 A. "Thanks Ior sending the loan-level basis. That is very
13 helpIul. Open items:
14 "(1) Were the loans that appeared by Iirst lien HELOC
15 actually Iirsts or seconds? I would like to conIirm that they
16 are Iirst, since the cash Ilow provided to S&P indicated that
17 there were Iirst in the pool."
18 "(2) Any luck getting cumulative loss data on the
19 2001 originations? Is there delinquency data and prepayment
20 that corresponds to the vintage cum loss already provided?"
21 "(3) Please conIirm that the cost basis provided on
22 the tape reIlects the cash premium paid to the broker or
23 correspondent. Is there any other expense paid by Flagstar
24 included in the calculation? There appears to be no FSA 91
25 amount in the basis Iigure."
1 Q. You don't have to read it into the record, but what was
2 your response to Mr. Beard?
3 A. My response suggested that we had the inIormation regarding
4 the Iirst position.
5 THE COURT: Wait a minute. The Iirst question was,
6 "Were the loans that appeared by Iirst lien HELOC actually
7 Iirsts or seconds?" Am I right that you did not yourselI
8 answer that question in your response? Correct?
9 THE WITNESS: In this response we did not.
10 THE COURT: The second question was, "Any luck getting
11 cumulative loss data on the 2001 originations? Is there
12 delinquency data and prepayment that corresponds to the vintage
13 cum loss already provided?" That you responded to indirectly
14 through the chart, right?
16 THE COURT: Which is not in evidence.
17 The third question was, "Please conIirm that the cost
18 base provided on the tape reIlects the cash premium paid to the
19 broker or correspondents. Is there any other expense paid by
20 Flagstar included in the calculation? There appears to be no
21 FSA 91 amount in the basis Iigure."
22 That you did respond to in the Iinal paragraph oI your
23 response, correct?
1 BY MS. SHIN:
2 Q. Did you have a Iollow-up phonecall.
3 A. Yes, we did.
4 Q. How oIten did you have conversations with representatives
5 at FSA oI this nature?
6 A. I don't recollect the exact number, but they were very
7 Irequent all through the process between Mr. Beard and JeIIrey
8 or myselI, multiple a week I would recollect.
9 Q. What do you mean by Irequent?
10 A. Several per week would be typical.
11 Q. Was this a level oI detail typical oI FSA's inquiries about
12 the loan tapes?
13 A. Yes. They took a very thorough interest in the loan tape,
14 wanted to get into virtually every Iield, and had questions
15 throughout the time Irame in a tremendous amount oI detail.
16 Q. Were there any other steps involved in the loan selection
17 process?
18 A. Yes. We kept through the process oI Iilling data gaps and
19 trying to identiIy loans that we couldn't get complete data in.
20 Again, I think our goal -- our goal was to make sure that by
21 the time we prepared the Iinal collateral tape, it was not a
22 case oI having garbage in there. It was a very solid data tape
23 by the time it reached the Iinal collateral tape. II we
24 couldn't Iind the appropriate data Ior the loans, they would
25 have been removed Irom the collateral tape beIore it was sent
1 on to the other parties oI the securitization.
2 MS. SHIN: Thank you, Mr. Jursek. That's all I have.
3 THE COURT: Cross-examination.
4 MR. BUCHDAHL: Your Honor, I think I can cut this way
5 down iI we can take a Iive-minute break beIore I begin.
6 THE COURT: All right, take a Iive-minute break.
7 (Recess)
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CAMJASS5 Jursek - cross Page 853
1 THE COURT: Please be seated. All right,
2 cross-examination
3 CROSS EXAMINATION
4 BY MR. BUCHDAHL:
5 Q. Good aIternoon, Mr. Jursek.
6 I want to ask you a couple oI questions about the data
7 integrity process you described earlier. The purpose oI this
8 was to make sure the inIormation on the loan tape that Flagstar
9 provided to JP Morgan was accurate, correct?
10 A. The ultimate purpose was to make sure that the data that
11 was on the collateral tape was accurate, so not just the data
12 that we provided to JP Morgan, the ultimate data that went to
13 support the transaction. It is an evolutionary process.
14 Q. Sure, but you wanted the loan tape to reIlect accurate
15 inIormation, correct?
16 A. Correct.
17 Q. That inIormation ultimately was Iirst collected by Flagstar
18 underwriting process, correct?
19 A. Correct.
20 Q. The underwriting loan Iiles would be the best source oI the
21 inIormation that is reIlected on that loan tape, correct?
22 A. Correct.
23 Q. Now, in the year-long process that resulted in the creation
24 oI this loan tape, Flagstar never pulled the loan Iiles that
25 had that inIormation, correct?
1 A. Actually, we went back to the underwriting system and
2 pulled data Irom the underwriting system which was a
3 representation oI the loan Iiles, so we did go back to the
4 underwriting system.
5 Q. You went back to your system, but you didn't go back to the
6 loan Iiles themselves, correct?
7 A. Correct.
8 Q. You relied on an underwriting system which may or may not
9 have reIlected what was in the loan Iiles, correct?
10 A. By the time the transaction closed, we were conIident that
11 it did.
12 Q. Why were you conIident?
13 A. It passed a lot oI internal data edits, data validation
14 routines and we were satisIied it was accurate.
15 Q. You never actually checked the loan Iiles themselves
16 against the tape, Iair?
17 A. That's Iair.
18 Q. Even though you had the opportunity because you had the
19 loans Iiles, correct?
20 A. We would have had the theoretical ability, yes.
21 Q. It wasn't theoretical. You had the practical ability to
22 pull the loan Iiles had you been interested in what they said,
23 correct?
24 MS. SHIN: Objection; argumentative.
25 THE COURT: No. I will disregard the tone, but the
1 question will stand.
2 BY MR. BUCHDAHL:
3 Q. It was a practical ability to pull those loan Iiles,
4 correct?
5 A. Yes, it would have been.
6 Q. Let's look at one more question about that process.
7 II there had been an error in the underwriting oI a
8 loan; in other words, let's say income had been erroneously
9 recorded on a loan application, that error would have been
10 Iound its way onto the loan tape, correct?
11 MS. SHIN: Objection; speculative.
13 A. It would have been Iound its way on to the loan tape and
14 been subject to the due diligence exercise, yes.
15 BY MR. BUCHDAHL:
16 Q. When you say the due diligence exercise, you're not talking
17 about any due diligence exercise perIormed by Flagstar,
18 correct?
19 A. Correct.
20 Q. II the due diligence exercise involved checking what was on
21 the loan tape against what was in the mortgage loan Iile, iI
22 those two numbers matched, it wouldn't reveal that error,
23 correct?
24 MS. SHIN: Objection.
1 MS. SHIN: Calls Ior speculation.
2 THE COURT: First oI all, I don't think so because
3 what it is asking Ior is the operation oI his process and how
4 it operates.
5 Second oI all, this witness has indicated a Iair
6 degree oI Iamiliarity with how this process operated; and
7 Thirdly, it is implicit in my previous overruling oI
8 your objection two minutes ago that I was going to overrule
9 this one. Go ahead.
10 THE WITNESS: Would you repeat the question.
11 BY MR. BUCHDAHL:
12 Q. Sure. The due diligence exercise, as you understand it, in
13 part included checking the loan Iiles against the data tape,
14 correct?
15 A. Correct.
16 Q. That exercise would not reveal an error iI the income
17 recorded in the loan Iile was the same as the income recorded
18 on the data tape, correct?
19 A. Correct.
20 Q. Let's look at DeIendant's Exhibit BAS that you were handed
21 by your counsel. Do you have that in Iront oI you, sir?
22 A. Which one is that?
23 Q. That is your 10-q?
24 A. Yes.
25 Q. Could you please turn to the pages that were tabbed by your
1 counsel.
2 A. Okay.
3 Q. Let's look at the second page that has a table with two
4 columns, one entitled June 30th oI 2012 and one entitled
5 December 31st oI 2011. Do you see that, sir?
6 A. Correct.
7 Q. What that table reIlects is Flagstar's assumptions about
8 the economics oI this deal as oI those two dates, correct?
9 A. As it relates to the transIeror's interest, correct.
10 You're looking at the second page, correct?
11 Q. I am. We don't see any change in the transIeror's interest
12 as projected by Flagstar in the 2006 transaction in the
13 six-month period, correct?
14 A. Correct.
15 Q. Because it was zero in both instances, correct?
16 And that zero value reIlects Flagstar's projections
17 that it would recover no money whatsoever on the 2006 deal,
18 correct?
19 A. Correct.
20 Q. And at a minimum, that assumption includes the underlying
21 assumption that Assured would not be reimbursed Ior the claims
22 against Assured, correct?
23 A. It does imply that, yes.
24 Q. Now let's turn to 2005. First oI all, you didn't create
25 this model yourselI, did you?
1 A. No, I did not.
2 Q. You didn't personally choose the assumptions that went into
3 this model to value the transIeror's interest Ior the 2004-2005
4 transaction?
5 A. At this point in time, yes, they would have been our
6 assumptions.
7 Q. I am talking about you, Mr. Jursek. You didn't create the
8 model, correct?
9 A. I didn't create the model. The assumptions are developed
10 within my department. They're approved at our management
11 committees, and the Iramework that we use to develop those
12 assumptions --
13 Q. Are you saying you're Iamiliar with all those assumptions?
14 A. Yes, I am.
15 Q. You said there was an interest rate assumption built into
16 this model. What are you assuming the interest rate would be?
17 A. We are using the current prime rate and the current LIBOR
18 rate held constant.
19 Q. What are you assuming with regard to continued deIaults in
20 this securitization?
21 A. We are using a loss curve generated out oI a model called
22 loan perIormance risk model. It is a collateral level
23 evaluation oI Iuture loss examinations.
24 Q. You didn't do this, correct? Somebody in your department
25 did?
1 A. Yes.
2 Q. Look at the Iigure Ior December 31, 2011. What was your
3 projected transIeror's interest as oI that time?
4 A. 9.5 million.
5 Q. And six months later Ior the same deal your projection Ior
6 your transIeror's interest had gone down by more than 20
7 percent, correct?
8 A. Correct.
9 Q. That is just in the last six months, Iair?
10 You don't know whether that is going to continue to go
11 down or go back up because it is just a projection, correct?
12 A. It is a projection based on current inIormation and current
13 collateral perIormance. It is our best best estimate oI the
14 current situation.
15 Q. Given your Iamiliarity with this model, how do you explain
16 the Iact that your transIeror's interest went down by 20
17 percent in the last six months?
18 A. Collateral perIormance, live expectations, second-lien
19 products.
20 Q. It lagged your expectations, correct? Your expectations
21 were wrong?
22 A. Correct.
23 Q. Now, when you initially entered into the 2005 and 2006
24 securitizations, you had projections as to what the residual
25 interest would be worth, correct?
1 A. Correct.
2 Q. What was your projection as to what the residual interest
3 Ior 2005 was at the time you entered?
4 A. I believe it was just a little bit under $20 million.
5 Q. $20 million?
6 Today zero, correct?
7 A. Correct.
8 Q. So that was $20 million you thought you might make, but now
9 you realize you're not going to make, correct?
10 A. Correct.
11 Q. That was based on an assumption at the time that the losses
12 experienced by the portIolio would only be 1.25 percent,
13 correct?
14 A. Correct.
15 Q. Now, you said beIore that this was your Flagstar's only
16 economic interest in this transaction. But, in Iact, Flagstar
17 had other ways oI making money Irom this transaction as well,
18 correct?
19 A. Such as?
20 Q. Such as servicing Iees, correct?
21 A. Correct, we were the servicer oI the loans.
22 Q. You were continuing to wean Iees Irom these loans Ior the
23 duration oI the time you act as servicer, correct?
24 A. I don't know the details oI the servicing arrangement, but
25 I would assume so.
1 Q. What, iI any, economic consequence was there Ior Flagstar
2 Ior having sold these loans into the trust in the Iirst
3 instance?
4 A. The economic consequence, we received an accounting gain on
5 sale but no cash beneIit Ior that transaction.
6 Q. It was -- I interrupted you.
7 A. We recorded an accounting gain on sale but received no cash
8 beneIits Irom the sale oI the loans into the securitization.
9 Q. What was your accounting gain on sale into the loans in the
10 2005 securitization?
11 A. My recollection is in the 12 million or 15 million,
12 somewhere in that range.
13 Q. Now let's turn to 2006. What was your initial projection
14 oI what Flagstar's residual interest would be in the 2006
15 securitization?
16 A. A similar size, although a little bit less. I recollect
17 the 15 million or so range.
18 Q. Just like the 2005 securitization, Flagstar's current
19 valuation oI its residual interest Ior 2006 is currently zero,
20 correct?
21 A. Correct.
22 Q. Now, you were aware, sir, that in entering into these
23 transactions, Flagstar was making certain representations and
24 warranties to Assured Guaranty, correct?
25 A. Correct.
1 Q. The Iact is Flagstar took absolutely no steps to conIirm at
2 the time oI these deals that those representations and
3 warranties were accurate, correct?
4 A. I really can't address that. I wasn't in the underwriting
5 area responsible Ior that aspect oI it. This was more oI an
6 accounting and Iinancial analysis exercise.
7 MR. BUCHDAHL: I would like to turn to the witness's
8 deposition at pages 134 and 135.
10 MR. BUCHDAHL: I will give you the line numbers in one
11 second. With permission, I would like to read into the record
12 Page 134 Line 10 to Page 135 line 9.
13 MS. SHIN: Objection.
14 THE COURT: Hold on a minute.
15 (Pause)
16 THE COURT: The objection is sustained. First oI all,
17 it is not inconsistent. Second oI all, the objections to the
18 Iorm remain at the time are also sustained.
19 MR. BUCHDAHL: May I oIIer the testimony as an
20 admission, your Honor?
21 THE COURT: Not iI the objection to Iorm is sustained.
22 MR. BUCHDAHL: Very well.
23 BY MR. BUCHDAHL:
24 Q. Mr. Jursek, at the time that these transactions were
25 entered into, you knew that credit had been an issue at
1 Flagstar, correct?
2 A. I guess I know credit is always an issue at a bank. It is
3 our business underwriting loans, accepting credit. That is the
4 typical banker's interest.
5 Q. You would agree that Flagstar had been very concerned about
6 its underwriting practices, correct?
7 MS. SHIN: Objection; vague.
9 MR. BUCHDAHL: Nothing Iurther, your Honor.
10 THE COURT: Any redirect?
11 MS. SHIN: No, your Honor.
12 THE COURT: Thank you very much. You may step down.
13 (Witness excused)
14 THE COURT: Please call your next witness.
15 MS. RENDON: Your Honor, we call Marni Scott to the
16 stand.
17 MARNI SCOTT,
18 called as a witness by the DeIendant,
19 having been duly sworn, testiIied as Iollows:
20 DIRECT EXAMINATION
21 BY MS. RENDON:
22 Q. Good aIternoon, Ms. Scott. I am going to ask you some
23 questions.
24 What company are you currently employed Ior, ma'am?
25 A. Flagstar Bank.
CAMJASS5 Scott - direct Page 864
1 Q. What is your title at that company?
2 A. Executive vice president oI mortgage credit operations.
3 Q. Functionally, what are your responsibilities at Flagstar at
4 this time?
5 A. At this time, I manage the Iront end origination operations
6 which would comprise underwriting, closing, post-closing.
7 Q. How long have you been at Flagstar Bank?
8 A. Since the Spring oI 2004.
9 Q. What are your current job responsibilities, Iocusing on
10 underwriting and origination?
11 A. My current job responsibilities would comprise all oI the
12 underwriting staII and underwriting management reporting
13 ultimately into myselI as well as credit policy setting.
14 Q. Is it Iair to say you're the head oI underwriting?
15 A. Yes, I am.
16 Q. How long have you had that role, ma'am?
17 A. Since the summer oI 2005.
18 Q. Let's talk a little bit -- we are going to come back to as
19 the head oI underwriting, we'll talk a little bit more.
20 BeIore we do that, let's talk about your underwriting
21 experience historically how is it that you have underwriting
22 experience?
23 A. I started in the industry in 1990. By 1991 I was acting or
24 operating as an apprentice underwriter, training with senior
25 underwriters in Southern CaliIornia as well as going through
1 underwriter training classes at the time, and then became aIter
2 a year or two an assistant underwriting manager Ior an
3 underwriting center.
4 Q. Where did you work prior to Flagstar where you received
5 this training?
6 A. GE Capital Mortgage Insurance.
7 Q. What type oI training did you receive as assistant loan
8 underwriter and as a loan underwriter?
9 A. As I described, the training is largely apprentice,
10 loan-by-loan level review, having your work rereviewed by
11 others, by others as well as there are classroom training
12 sessions such as appraisal analysis, income calculation Ior
13 qualiIication, selI-employed tax returns. Various course work
14 as well would be completed.
15 Q. Why did you come to Flagstar in 2004?
16 A. I had been at GE Ior approximately 14 years, and I held
17 many positions Irom risk manager to regional underwriting
18 manager. I was head, national underwriting manager towards the
19 end oI my time there in Chicago, and with Iamily ties to
20 Michigan, Ielt that Flagstar would be a good Iit.
21 They were known in the industry as a conservative
22 entity plus they had top, top technology, state oI the art
23 technology that really could help leverage the process.
24 Q. Let's break your answer down a little bit iI I can, ma'am.
25 So you came to Flagstar in 2004. Is that correct?
1 MR. PORTERA: Objection; leading.
2 MS. RENDON: It is just a Ioundational question, your
3 Honor.
4 THE COURT: I'll allow it.
5 THE WITNESS: Yes.
6 BY MS. RENDON:
7 Q. You said that Flagstar was a good Iit Ior you when you
8 started, and you were describing the underwriting culture at
9 Flagstar. Can you describe Ior us when you came to Flagstar
10 what the underwriting culture was? And I am Iocusing on credit
11 policy.
12 A. From the president down, there was extensive responsibility
13 and authority that the credit leaders, my hiring manager at the
14 time, Linda Terrasi, that we had, and so there was not only
15 invested in the technology Irom a quality consistency
16 establishment, but also the culture was such that there really
17 wasn't a sales trumping ops type culture.
18 Q. You talked about a willingness by management to invest
19 capital to increase the quality oI originations. Can you give
20 us an example oI how Flagstar did that around this time period,
21 2004, 2005, 2006?
22 A. In 2004 as an example, they had already Iully integrated
23 with various ABM tools. As time was passing, we were
24 integrating various processes around reveriIication oI
25 deposits, employment, income, Lexis-Nexis was a type tool,
1 their anti-money laundering portal was a tool that all oI the
2 underwriters had as access to so we could train and letter
3 acknowledge around that. That are some oI the processes.
4 Q. By the summer oI 2005, what was your responsibility at
5 Flagstar?
6 A. As oI that summer, the underwriting, the conventional
7 underwriting regents, the Iirst line, Fannie Mae, Freddie Mac,
8 as well as second-lien, HELOC term seconds would be
9 underwriting by the staII reporting to myselI.
10 Q. When did Flagstar get into underwriting HELOCs, ma'am?
11 A. Early in 2004 they started originating an underwriting
12 through the retail mortgage Iunction HELOCs.
13 Q. Can you describe HELOCs Ior us as a product.
14 A. HELOC is a home equity line oI credit and so it is
15 typically a second-lien position, loan amount that can be drawn
16 down or up or I guess paid down or drawn up in terms oI the
17 overall balance, and it is attached to the property. You're
18 typically paying prime plus a margin on the outstanding
19 principal balance.
20 Q. Are there any, in your experience in underwriting HELOCs,
21 are there any peculiar risks, Ms. Scott, associated with that
22 loan product?
23 A. Well, the main risks would certainly be that most oI the
24 time the liens are in second position and so as such, there is
25 high CLTVs, limited equity established and so certainly as
1 price Iluctuations would take place, you would be overly
2 exposed when you're into high CLTV-type transactions.
3 Q. What do you mean when price Iluctuations take place?
4 A. Over time economies strengthen and weaken, housing industry
5 strengthens and weakens, and so with price Ialls, you would be
6 exposed much more Irom a deIault Irequency as well as deIault
7 severity standpoint with high CLTVs.
8 Q. What do you mean by you would be exposed in terms oI
9 deIault Irequency?
10 MR. PORTERA: I object on relevance grounds.
11 THE COURT: I'll allow it.
12 BY MS. RENDON:
13 Q. You can answer.
14 A. Having also been in high LTV lending in the Iirst 14 years
15 oI my career, you have very limited equity Irom the borrower
16 into the property and so couple that with being a second-lien
17 transaction, you're ending up with what could be an economic
18 downturn, higher deIault Irequency as borrowers experience
19 economic issues and limited equity in the properties.
20 Q. What was Flagstar's underwriting philosophy with regard to
21 the originations oI HELOCs?
22 A. Flagstar was originating them to be put on the balance
23 sheet and so as we would meet with the underwriters, talk about
24 training, we were talking about the overall risk protection Ior
25 Flagstar Bank with being an asset on balance sheet, so
1 relatively conservative.
2 Q. Relative to other lenders in the market, where would you
3 say Flagstar Iell as Iar as the conservatism oI its
4 underwriting guidelines?
5 MR. PORTERA: Objection; relevance.
7 BY MS. RENDON:
8 Q. Are you Iamiliar with the underwriting guidelines oI
9 Flagstar that were in place Ior HELOCs in the time period 2004
10 to 2006, ma'am?
11 A. In a general sense, yes.
12 Q. Can you describe Ior me characteristics about those
13 underwriting guidelines that you think deIine Flagstar's
14 philosophy towards underwriting?
15 A. The FICO Iloors would as much as the product descriptions
16 would allow down to 620 is the lowest. It was only at lower
17 CLTV type-caps and the vast, vast majority oI the loans were
18 above 660 Irom a FICO standpoint, and then we also were limited
19 in terms oI second home, investor, occupancy, in terms oI lower
20 CLTV caps or limitations, altogether limitations on three to
21 Iour unit properties.
22 THE COURT: Who creates these guidelines?
23 THE WITNESS: The credit risk committee at the bank.
24 THE COURT: Not your department?
25 THE WITNESS: I would be a member oI that credit risk
1 committee, yes.
2 THE COURT: So why are you only generally Iamiliar
3 with those guidelines?
4 THE WITNESS: Well, the guidelines change
5 approximately every three to Iour to six months, so iI I were
6 asked a very, very speciIic question, I would want to review
7 the actual product description to answer the question.
8 THE COURT: Go ahead, counsel.
9 MS. RENDON: Okay.
10 BY MS. RENDON:
11 Q. You described, Ms. Scott, there being what I think you
12 called FICO Iloors and caps. What is the signiIicance, in your
13 mind, oI only extending high CLTV loans to FICOs above 660, 660
14 or above?
15 A. The question is what is the signiIicance?
16 Q. Yes. In other words, in having -- let me rephrase.
17 THE COURT: I think the witness is objecting as vague
18 and ambiguous. I sustain her objection.
19 BY MS. RENDON:
20 Q. Let me break that down.
21 I believe you indicated, Ms. Scott, that Flagstar's
22 underwriting guidelines had FICO Iloors, is that correct, Ior
23 HELOC products?
24 A. Yes, they did.
25 Q. You indicated within that FICO Iloor Flagstar would
1 generally only extend high CLTV HELOCs to borrowers who had
2 FICO oI 660 greater. Is that correct?
3 A. Yes.
4 Q. By writing the underwriting guidelines -- what was the
5 purpose oI creating or Iashioning the underwriting guidelines
6 in that way?
7 A. There's a Iairly drastic deterioration in overall deIault
8 Irequency once you get into the bands, 660 to 640, 640 to 620,
9 certainly 600 and below.
10 Q. Were the HELOCs involved in these transactions extended to
11 sub-prime borrowers, ma'am?
12 A. No.
13 Q. Did Flagstar do business with sub-prime borrowers in this
14 period 2004 to 2007?
15 A. No.
16 Q. Why not?
17 A. Our president or I guess starting with our president had a
18 philosophy that sub-prime was not at all part oI the industry
19 that we wanted to enter into. We didn't think it was good Ior
20 the bank or the consumer.
21 Q. Through which channels did Flagstar originate HELOCs?
22 A. Predominantly through the retail channel to -- well,
23 exclusively through the retail channel to start and then I
24 believe by the Fall oI 2004 we started expanding to the broker
25 and correspondent channel.
1 Q. Why did Flagstar start originating HELOCs in 2004 only in
2 the retail channel?
3 MR. PORTERA: Objection; relevance.
4 THE COURT: No. I'll allow it.
5 BY MS. RENDON:
6 Q. You can answer.
7 A. We started with the retail because we were starting just in
8 Michigan, and then Michigan and in Indiana so we could get the
9 state-speciIic documentation, the closing, closing documents,
10 settlement documentation and state-level requirements in place
11 and then we started expanding out to additional states and then
12 later added the other origination channels.
13 Q. We probably should break this down a little bit. When we
14 talk about originating through diIIerent channels, what does
15 that mean, Ms. Scott?
16 A. Basically there are three origination channels in the U.S.
17 Retail would be through a loan oIIicer who is an
18 employee oI the bank. The broker channel would have a loan
19 oIIicer and processer that would be an employee oI the broker,
20 whereby Flagstar would be wiring the Iunds to the closing.
21 A correspondent channel is where the correspondent has
22 their own Iunds, so it can be a credit union, a bank, warehouse
23 line, Iunctionally the loan oIIicer and processer and employee
24 oI the correspondent.
25 Q. You said in 2004 Flagstar started originating HELOCs in
1 retail and gradually extended originations to the broker and
2 correspondent channels, correct?
3 A. Yes.
4 Q. In that process oI extending -- well, when Flagstar
5 extended originations to brokers and correspondents, who
6 actually underwrote the loans?
7 A. Flagstar, the staII reporting to myselI.
8 Q. Explain Ior me what it means then to originate a loan by a
9 broker, Ior instance, would have Flagstar underwrite the loan?
10 A. The originator has the loan oIIicer, so the person who's
11 having contact with the consumer as well as the processor would
12 also have contact with the consumer, and so on the
13 broker-correspondent channels, those two employees, are
14 employees oI the broker correspondent, but otherwise the
15 underwriting Ior all three channels was handled by Flagstar.
16 Q. What iI I asked, would that process be the same iI it was a
17 correspondent that was originating the loan Ior Flagstar?
18 A. Yes.
19 Q. In other words, Flagstar still did the underwriting oI that
20 loan, correct?
21 A. Yes.
22 MR. PORTERA: Objection; leading.
23 THE COURT: No. I think that was just a necessary
24 clariIication.
25 BY MS. RENDON:
1 Q. When Flagstar extended originations to brokers and
2 correspondents, what, iI any, due diligence occurred prior to
3 permitting a broker or correspondent to originate a loan?
4 A. We have centralized department in the the headquarters that
5 would be reviewing various credentials and documentation Ior
6 any broker correspondent that is applying to deliver and do
7 business with Flagstar.
8 We would have an on-site review, but also looking at
9 the Iinancials, the credit would be pulled Ior all oI the
10 owners, the Iinancials Ior the owners, licensing. Negative
11 news Irom various sources would be reviewed as well.
12 Q. Was there ever a period where a site visit would occur to a
13 broker or correspondent?
14 A. Yes. Yes, we have employees out in the Iield that would be
15 physically reviewing business with the broker correspondent.
16 Q. Why did Flagstar as part oI the due diligence it perIormed
17 on originating brokers and correspondents review their
18 Iinancials?
19 A. Certain we wanted to make sure that they were Iinancially
20 sound, so we would have net worth requirements plus be
21 reviewing the resumes and length oI, length oI time the entity
22 was in business.
23 Q. I believe you indicated that credit, a credit check was
24 perIormed on the owners oI brokers and correspondents. Is that
25 correct?
1 A. Yes.
2 Q. Why was that perIormed by Flagstar?
3 A. To make sure people we were doing with business were
4 reputable and repaying their own debts since they would be
5 working with consumers.
6 Q. You indicated that one oI the steps oI the due diligence
7 Flagstar perIormed on its originating brokers and
8 correspondents was checking the licensing oI the brokers and
9 correspondents. Why did Flagstar do that?
10 A. We certainly would want to assure they were licensed
11 properly in each state that they were operating in. We would
12 then, within the technology platIorm we have, every broker
13 correspondent is tracked by state Ior licensing and would
14 expire as any license was expiring.
15 Q. You Iurther indicated that Flagstar had a database on
16 negative news, I think you called it MARI. Is that correct?
17 A. Yes.
18 Q. What was it? What did Flagstar do with MARI and why?
19 You can break that into two questions iI the court
20 preIers.
21 A. It is, I think it is Mortgage Asset Resolutions, but in any
22 case it is a consortium database that lenders, states, various
23 other government entities would report into iI there were
24 individual loans that had predominantly Iraud on them.
25 And so the negative news was around either Iraud
1 within the appraisal, Iraud within the origination, and so we
2 would certainly track that and not be doing business with
3 entities that had negative news tracks.
4 Q. Why did Flagstar perIorm all oI this due diligence on the
5 brokers and correspondents with whom it permitted to original
6 HELOCs?
7 A. We certainly want to know who we're doing business with and
8 be looking to assure we are doing business with entities with
9 integrity and history oI conducting business that way.
10 Q. I believe it is your testimony, regardless oI whether it
11 was through retail, broker or correspondent channels, it was
12 always Flagstar that underwrote the HELOCs, correct?
13 A. Yes.
14 Q. Let's talk about that underwriting process, Ms. Scott. Who
15 actually underwrote Flagstar's HELOCs?
16 A. The Flagstar underwriters.
17 Q. Can you describe Ior me, is this a staII that worked Ior
18 you?
19 A. Yes, we're all in 4 West in the headquarters, one wing, one
20 Iloor.
21 Q. That sounds like the West Wing. Can you describe Ior us --
22 A. The underwriters are there who also have Ior time zone
23 coverage, underwriters in Dallas and underwriters in Bellevue,
24 Washington.
25 Q. How big a staII, in Iocusing on the time period 2004
1 through 2006, ma'am, how big a staII oI underwriters was
2 underwriting HELOCs in that period oI time?
3 A. Approximately 50 to 60 underwriters.
4 Q. You indicated that the vast majority oI those underwriters
5 were located in Michigan. Is that correct?
6 A. Yes.
7 Q. What was the import oI that, ma'am?
8 A. From an overall training, quality, consistency, we
9 certainly wanted to make sure that all oI the underwriters were
10 co-located, or our headquarters has an auditorium Iacility and
11 so we would conduct training there as well as Iacilitate
12 training out in the other centers at the same time.
13 Q. You mentioned consistency I believe is one aspect oI your
14 last answer. Is that correct?
15 A. Yes.
16 Q. What do you mean about greater consistency in underwriting?
17 A. As much as the underwriters, each group oI underwriters
18 would have a manager, an assistant manager literally co-located
19 next to each other but covering diIIerent geographies oI the
20 country so as to better analyze appraisals, but we would have
21 routine staII meetings, whether it be with the managers,
22 managers with all oI their underwriters just to bring Iorth
23 more consistency or heightened consistency in the process.
24 Q. What resources were available to this staII oI underwriters
25 who were underwriting HELOCs during this period oI time iI they
1 had a question?
2 A. Well, they were physically located with their managers, so
3 managers typically are spending 50 to 60 percent oI their time
4 with their staII in addition to customers, any outside entities
5 that were doing business with, they would routinely be talking
6 through loans.
7 Q. In the time period oI 2004 through 2006, what was the level
8 oI the staII oI underwriters' experience who were underwriting
9 HELOCs?
10 A. The minimum is typically three years, but the average would
11 have been closer to eight to nine years. Some oI the
12 underwriters would have had 20 to 30 years underwriting
13 experience.
14 Q. I want to back up. I believe earlier you indicated that
15 your staII oI underwriters who are underwriting HELOCs in this
16 time period, 2004 through 2006, received training, correct?
17 A. Yes.
18 Q. What kind oI training did these underwriters receive?
19 A. We would routinely have reIresher training, so around
20 appraisal, selI-employed, income analysis, income calculation.
21 We would also have training on any Iraud prevention,
22 Iraud detection tools that either processes that we currently
23 had, but that also had -- we're also introducing to the staII.
24 Q. I want to break that down iI I can, ma'am.
25 You said that one oI the Iorms oI training that these
1 underwriters received who are underwriting HELOCs in this time
2 period, 2004 to 2006, receive related to appraisal training.
3 Is that correct?
4 A. Yes.
5 Q. Please describe Ior me what type oI appraisal training your
6 HELOC underwriters received in this time period?
7 A. The appraisal training generally comprises not only
8 analysis oI the diIIerent appraisal Iorms, oI which there is
9 one Ior single Iamily, there is one Ior condo, one Ior
10 multiunit, but would also then go through case studies in
11 talking about challenging appraisals Ior analysis and
12 decisioning.
13 Q. Describe Ior me what you mean by that, you go through case
14 studies on appraisals Ior analysis and decision?
15 A. We have a chieI appraiser as well as staII appraisers so
16 they would have examples over time they would have accumulated
17 as they were in discussions with management or underwriters, so
18 they would use those as case studies, plus we would have
19 outside entities. At times the mortgage insurance companies
20 would provide training and they have their own case studies.
21 Q. In training your underwriters in this regard, what were you
22 hoping to achieve? What was it you were trying to teach your
23 underwriters?
24 A. How to assess whether you have a credible report, has the
25 appraiser completed a credible report, is the value supported
1 in what the appraiser has arrived at, and iI there is any
2 additional inIormation that we need, how to determine what that
3 additional inIormation is, so we would also talk about the
4 ABMs, automated valuation models that are providing other sales
5 in the property area.
6 So the underwriter would be assessing the report,
7 assessing other tools and potentially working with the
8 appraiser to gather additional inIormation and/or ultimately
9 approving or declining a transaction based on the appraisal.
10 Q. We'll come back to Flagstar's use oI ABMs later on, but I
11 want to stay Iocused on training iI I can Ior a moment.
12 A. Okay.
13 Q. Was one purpose in providing appraisal training to help
14 your appraisers detect any type oI potential appraisal Iraud?
15 A. Yes, that was part oI the training.
16 Q. Describe that Ior me, ma'am.
17 A. As we're reviewing the case studies, we certainly would
18 either have training Iocused exclusively on Iraud prevention or
19 as part oI the appraisal training, a segment oI the training
20 would be around appraisers, potentially using comparable sales
21 that were not the best choice in order to potentially inIlate a
22 property value and such.
23 Q. You mentioned a second type oI training to include training
24 around selI-employment. Is that correct?
25 A. Yes.
1 Q. Describe Ior me, when you say training and selI-employment,
2 that is a general phrase. Can you describe Ior me what you
3 mean by that?
4 A. Approximately 15 percent oI the consumers are deemed
5 selI-employed, meaning they own 25 percent or greater oI their
6 business, and so tax returns would be required.
7 So there was a three to Iour hour session that would
8 be conducted just on the Schedules A through E oI the tax
9 returns, and then another training session speciIic to
10 corporations, S Corp. and partnership analysis Ior appropriate
11 qualiIying income.
12 Q. Let's break that latter down, that latter component Ior --
13 excuse me. II you could, break down that latter component oI
14 your answer Ior me. When you say corporate, the S Corp., what
15 type oI training you were conducting there?
16 A. Amongst individuals who Iile tax returns where an
17 underwriter would need to be reviewing those tax returns Ior
18 income analysis, we would require review oI the S Corp. tax
19 return, the corporation or the partnership returns and there
20 are instances where you can or cannot use various income as
21 being report through those, through those returns.
22 THE COURT: What is a stated income loan?
23 THE WITNESS: A stated income loan exists Ior both
24 wage earners as well as selI-employed, so W-2 and selI-employed
25 where the consumer is stating an amount oI income and there is
1 not veriIication oI the pay stubs or tax returns.
2 THE COURT: Why not?
3 THE WITNESS: That was a program that existed in the
4 marketplace and was part oI the segment. Typically they would
5 have higher FICO scores associated with them.
6 THE COURT: So Flagstar entered into that program,
7 yes?
8 THE WITNESS: It was actually a smaller part oI what
9 we originated certainly relative to the industry but, yes, a
10 portion oI our volume was stated income.
11 THE COURT: Was that part oI your conservative
12 approach?
13 THE WITNESS: We did have higher FICOs, we did have
14 more limited occupancy and CLTV combinations, so while we did
15 allow it, it had actually been a part oI Fannie Mae, Freddie
16 Mac guidelines which is a core Iundamental oI what we model
17 some oI our guidelines oII oII since the mid-'90s, there was a
18 10 or 11 year history oI it.
19 THE COURT: So take me through this. II someone says
20 on their application I make $10,000 a month, and no one asks
21 Ior income tax, no one asks Ior pay stubs, does someone call
22 the employer?
23 THE WITNESS: Yes, they do.
24 THE COURT: In each and every case?
1 THE COURT: All right. So let me show you what is
2 part oI a loan Iile. This is just the application and it's got
3 a bunch oI Bates stamps, which are really thrilling, but the
4 one I'll use is Walzak 021270128 and 0129. This is the
5 document handed up by plaintiII's counsel earlier today. Let
6 me show it to you. Take a minute to review it iI you will.
7 (Pause)
8 THE COURT: So you'll notice that the -- let's go to
9 the last page Ior a moment. You'll see that it says at the
10 very bottom, the interviewer's name and the interviewer's
11 employer is Regional Financial Group, Inc. Do you see that?
12 THE WITNESS: Yes, I do.
13 THE COURT: Does that mean that was not a Flagstar
14 person, was it?
15 THE WITNESS: No. The originator worked Ior Regional
16 Financial Group, which would have been a broker correspondent.
17 THE COURT: This would have been a broker used by
18 Flagstar?
19 THE WITNESS: The broker was using Flagstar.
20 THE COURT: The broker was using Flagstar?
21 So, and the broker was an employee oI Regional
22 Financial Group, Inc. Do you see that?
24 THE COURT: Am I right that this, iI I understood your
25 testimony earlier, this loan application would eventually be
1 reviewed by Flagstar?
2 THE WITNESS: Yes.
3 THE COURT: Turn to the Iirst page. Don't mention the
4 borrower's name because Ior privacy reasons we are not, not
5 mentioning that. You'll see that the borrower is described as
6 Regional Financial Group, Inc.
7 Do you see that?
9 THE COURT: And speciIically the application says that
10 this person is the president oI Regional Financial Group, Inc.
11 and has been so Ior Iive years, et cetera.
12 Do you see that?
14 THE COURT: How can that be? Isn't that on its Iace
15 preposterous?
16 THE WITNESS: No. I don't understand.
17 THE WITNESS: Do you want to tell what you I think?
18 THE COURT: You, the person seeking the loan, is the
19 president oI Regional Financial Group.
20 THE WITNESS: What the underwriter process would have
21 been, should have been would be to either through Lexis-Nexis
22 or other internet tools to determine iI Regional Financial
23 Group is that entity, number one, in business.
24 THE COURT: It must be iI you're using it as the
25 interviewing agency, yes?
1 THE WITNESS: We can likely conclude they were in
2 business, and then Irom various corporation websites we should
3 have determined that the person who is the borrower was the
4 president.
5 THE COURT: Okay. Now, so that's what should have
6 happened. Now, iI that didn't happen, that would have been a
7 violation oI your guidelines?
8 THE WITNESS: OI the process around conIirming that
9 this individual had that job title, yes.
10 THE COURT: By the way, just aside Irom everything
11 else, would there not have been some question, in taking this
12 literally, an employee oI Regional Financial Group, Mr. GeoII
13 Berry, processing the loan application oI the president, the
14 purported president oI this company?
15 THE WITNESS: No. We allow Ior loan oIIicers within
16 the same entity just as we would do our own employee loans.
17 THE COURT: Now, the evidence beIore the court
18 indicates that iI the check that you described should have been
19 made, had been made, it would have been discovered that this
20 person was a local policeman.
21 So the person taking this inIormation, Mr. GeoII
22 Berry, assuming that is a real person, would have surely known
23 that the person making the application wasn't the president oI
24 this company?
25 THE WITNESS: What sort oI evidence was there around
1 who the president was?
2 THE COURT: The president, I assure you, was not this
3 gentleman, but the company is based in a city at least a
4 thousand miles away, and they have local oIIices. This, Irom
5 all the evidence beIore the court, this gentleman was and still
6 is until his retirement about a month ago a Detroit police
7 oIIicer.
8 My question is not that. My question goes back to, it
9 appears to me, and this is why I am raising this, this may be
10 an extreme case, the situation is perIect, it appears to me
11 even the most modest checking oI the sort you say should have
12 been done would have revealed this to be a patently Iraudulent
13 application?
14 THE WITNESS: I would have have to look at it. He
15 could have two positions.
16 THE COURT: You think, you think that a Detroit police
17 oIIicer would also be the president oI a substantial Iinancial,
18 Regional Financial Group you were doing business with that had
19 oIIices in numerous states, that that was sort oI his sideline,
20 he came home at 7:00 and as soon as he had dinner, he turned
21 his attention to being the president oI a major Iinancial
22 group? Is that what you think?
23 THE WITNESS: I would have to look at the inIormation.
25
Camrass6 Scott - direct Page 887
1 THE COURT: Do you think that is even remotely
2 plausible?
3 THE WITNESS: Probably not making this amount oI
4 income.
5 MS. RENDON: Your Honor, may I approach the witness?
6 THE COURT: Yes. But then we are going to have to end
7 Ior today and continue tomorrow.
8 BY MS. RENDON:
9 Q. Ms. Scott, are you Iamiliar with loan servicing Iiles Irom
10 Flagstar?
11 A. Yes. I don't manage servicing, but I've looked at
12 collection records beIore.
13 Q. Do you agree with me that this is the loan servicing report
14 Ior the loan application that his Honor was just looking at?
15 And we are looking at DeIendant's Exhibit BBB 0001.
16 A. You want me to conIirm that this is the same loan?
17 Q. II you can Irom the Iace oI the application. I certainly
18 will represent to the Court that is my understanding. It's Ior
19 loan ending in 23960.
20 THE COURT: II plaintiII's counsel agrees, we will
21 receive it. I'm not sure it is Iair to put it in Iront oI this
22 witness, who has not seen it beIore this moment, I don't
23 suppose.
24 MS. RENDON: I'm just going to ask, iI I may, and
25 we'll see --
1 THE COURT: Let's see iI it's in evidence.
2 MS. RENDON: I'd like to admit it into evidence.
3 MR. PORTERA: Your Honor, we object on hearsay
4 grounds, that they qualiIied it as a business record.
5 THE COURT: You don't think this qualiIies as a
6 business record? You don't think this is about as classic a
7 business record as one can ever have in court? Is that your
8 position?
9 MR. PORTERA: No, your Honor. I think it probably is
10 a business record.
11 THE COURT: Good. Received.
12 (DeIendant's Exhibit BBB received in evidence)
13 Q. May I ask the witness to turn to Flagstar 01-00326942.
14 SpeciIically, I'm going to ask that the witness look at the
15 entry on March 2, 2009, at 1559.
16 THE COURT: Sorry two thousand --
17 MS. RENDON: Nine. March 2nd.
18 THE COURT: This is a loan Irom 2005, is it not?
19 MS. RENDON: Yes, your Honor. But these are the
20 servicing collection notes Ior that very same loan. This is
21 reIlective oI a notation Irom March 2, 2009 at 1559.
22 THE COURT: Hold on a minute. March -- what was the
23 date?
24 MS. RENDON: March 2, 2009.
25 THE COURT: At 1559.
1 Q. It says there, "Phone 1 rings, then Iax tone, SBNP number
2 sign IDM hardship letter, customer not working, was mortgage
3 broker and police sergeant oIIicer with no pay," and then there
4 is a worksheet and a large number there aIter, no other number.
5 As someone Iamiliar with reading servicing and collection
6 notes, what do you understand this servicing note to be
7 stating?
8 A. It's stating that within our documentation we had a
9 hardship letter. Typically, it's a handwritten letter Irom a
10 consumer. That was indicating that he was not working, he was
11 a mortgage broker and a police sergeant, he is now oII with no
12 pay. Then that number is his home residence telephone number.
13 THE COURT: Counsel, I'm not sure I understand the
14 relevance. This is Iour years later.
15 MS. RENDON: Your Honor, I think it is a statement by
16 the exact borrower on the loan that we are talking about
17 conIirming that he in Iact held two positions, both as a police
18 oIIicer and a mortgage broker.
19 THE COURT: Yes. As I indicated previously, Irom
20 everything I've seen, I'm really seriously wondering whether I
21 need to reIer this matter to the U.S. Attorney's oIIice in
22 Michigan Ior prosecution. But I understand that that is not
23 your or Flagstar's job. I don't see anything here, and I
24 appreciate your putting this beIore me, indicating that there
25 was any check oI the kind you're talking about or the witness
1 was talking about done at the time the loan was approved.
2 MS. RENDON: Your Honor, I'm not going to ask Ms.
3 Scott to speak to that, because I don't believe she is
4 qualiIied to speak to the speciIic loan Iile. But we will have
5 testimony later in the case on this speciIic loan Iile.
6 THE COURT: Would that appear in the normal course on
7 this printout, iI there had been a check done?
8 MS. RENDON: Not in the servicing record, your Honor.
9 It would have been in the underwriting Iile. II you're asking
10 about a check at the time oI the closing oI the loan --
11 THE COURT: Yes, which is when the witness indicated
12 the check would be made, right?
13 THE WITNESS: Right. We would have checked our own
14 online. We track all oI our customers in our database. So we
15 would have had Regional Financial Group.
16 THE COURT: Does that appear here?
17 MS. RENDON: On the servicing record is your question,
18 your Honor?
19 THE COURT: Yes.
20 THE WITNESS: No. This is the servicing record and
21 this is the loan app. But within Flagstar's database, since
22 this was a broker customer oI ours, we would track all oI the
23 oIIicers within our own database. It's not on either oI these
24 two sheets oI paper.
25 THE COURT: While we have this, this is in reverse
1 chronological order, yes?
2 MS. RENDON: That's correct, your Honor.
3 THE COURT: Turning to three pages Irom the back, the
4 one that begins 2008-10-16, at 2008-09-22 it says, "No call per
5 history." What does that mean? This is directed to the
6 witness. II you know.
7 THE WITNESS: Which line?
8 THE COURT: 2008-09-22.
9 THE WITNESS: The month they are logging when the
10 HELOC statement is sent out. It looks like just a generic
11 comment that they haven't contacted the borrower yet.
12 THE COURT: II you go down earlier, because remember
13 this is in reverse order, at 2008-02-21, February 21, it
14 says -- I'm sorry. Go down to 2008-02-21. There are several
15 entries. The Iirst one is at 1232, "Could not locate via
16 wp.com." What does that mean?
17 THE WITNESS: I don't know. It would be shorthand Ior
18 something in servicing. I assume it means white pages.
19 THE COURT: Meaning they couldn't Iind the phone
20 number through the white pages?
22 THE COURT: OI course, they had a phone number on the
23 application, so that suggests, does it not, that that phone
24 number wasn't working?
25 THE WITNESS: Right. Either not answering, people
1 have switched to cell phones.
2 THE COURT: Whatever. Then it says in the next entry
3 going up, "Called phone numbers Irom other accounts being
4 checked Ior trouble." There are two phone numbers listed
5 there. "General POE VM," what does that mean?
6 THE WITNESS: I don't know what POE stands Ior. VM
7 would be voicemail, "no message leIt."
8 THE COURT: "No message leIt." Another phone called
9 and leIt voicemail, adding still another one. This all
10 suggests that there was some problem, right?
12 THE COURT: For making all these calls.
14 THE COURT: Then there was on 2008-02-23, "Called
15 phone number, child answered, no message leIt." I'm sure that
16 must have been the executive vice president oI the loan company
17 that this man was the president oI. Then, on 2008-09-16 at --
18 THE WITNESS: "Talked to Iemale, borrower not there,
19 leIt message."
20 THE COURT: Thank you. Something is going on here, is
21 it Iair to assume, given all these calls in February through
22 the summer oI 2008, right?
24 THE COURT: Going over to the bottom oI the next page,
25 it says at 2008-10-22, "Complete K. Smith 1. Has payment been
1 received?" What's K. Smith 1?
2 THE WITNESS: It's got to be somebody's login, likely
3 another employee at Flagstar.
4 THE COURT: I'm glad to know it's not Kate Smith come
5 back Irom the grave. All right. I should cease being
6 Iacetious. Has payment been received? What is meant by that?
7 THE WITNESS: Two lines down it says, "Talked to
8 borrower. Payment Ior October was supposed to be made online
9 via Flagstar.com." I assume this is Iollowing up to conIirm he
10 did that.
11 THE COURT: I'm beginning to get this. 2008-11-18
12 "Phone number number 1 leIt message," is that what that means?
14 THE COURT: Finally, a hardship letter was received.
15 This was on 2008, January 14th, yes? Received on January 5th.
16 Do you see the entry?
18 THE COURT: The eIIect oI that is to say he's giving a
19 reason why he can't pay, yes?
20 THE WITNESS: Reason plus describing at times what
21 options, meaning Iorbearant loss mitigation options.
22 THE COURT: What, iI anything, is done to check the
23 accuracy oI the statements made in a hardship letter?
24 THE WITNESS: Are you asking me is anything done to
25 check it?
1 THE COURT: What is your normal practice?
2 THE WITNESS: It changed over time. Flagstar as well
3 as the industry changed. Probably at this point in time, most
4 oI it was whatever the borrower said you went with, and you
5 would get some handwritten Iinancial Iigures and then at times
6 get paystubs.
7 THE COURT: As reIlected in the entry that your
8 counsel brought your attention to on March 2, 2009, on the next
9 page, is it not likely that when he said he was not working,
10 was a mortgage broker and a police sergeant but he's now oII
11 with no pay, that that was just accepted at this time on its
12 Iace?
13 THE WITNESS: Yes, it was.
14 MS. RENDON: Do you want me to continue, your Honor?
15 THE COURT: I cannot tell you how much I would love to
16 go on, but I think it is enough Ior today. We will reconvene
17 tomorrow at 10 o'clock.
18 MR. AARON: Your Honor, would you permit a quick
19 scheduling question?
20 THE COURT: Yes.
21 MR. AARON: How late tomorrow does your Honor
22 anticipate sitting?
23 THE COURT: 5 o'clock.
24 MR. AARON: On Thursday do you have a sense yet, or
25 not yet?
1 THE COURT: I think probably 5 o'clock, but let me
2 look. My boss tells me maybe 4:00.
3 MR. BUCHDAHL: Your Honor, just one last thing. Given
4 that there has been some shuIIling with the deposition, iI we
5 could get an order oI witnesses Ior tomorrow Irom deIense
6 counsel?
7 THE COURT: Yes. And you're going to give me the
8 marked up other depositions tomorrow.
9 MR. BUCHDAHL: Correct. I mean the order oI live
10 witnesses.
11 THE COURT: What is the order tomorrow?
12 MS. RENDON: We are going to Iinish with Ms. Scott and
13 then proceed to two oI our experts, JeII Nielsen and then John
14 Griggs.
15 THE COURT: Thanks a lot.
16 (Adjourned to 10:00 a.m., October 23, 2012)
17
18
19
20
21
22
23
24
25
Page 896
1 INDFX oF FXAMINATIoN
2 Fxamination of: Page
3 STANLFY D. JURSFK 800
4 Direct By Ms. Shin . . . . . . . . . . . 800
Cross By Mr. Buchdahl . . . . . . . . . . 853
5
6 MARNI SCoTT
7 Direct By Ms. Rendon . . . . . . . . . . 863
8
9 PLAINTIFF FXHIBITS
10 Fxhibit No. Received
11 54 . . . . . . . . . . . . . . . . . . . . 848
12
13 DFFFNDANT FXHIBITS
14 Fxhibit No. Received
15 BAS . . . . . . . . . . . . . . . . . . . . 813
16 BBB . . . . . . . . . . . . . . . . . . . . 888
17
18
19
20
21
22
23
24
25
$
$10,000 (1)
882:20
$111 (2)
784:15;788:22
$120,000 (1)
755:24
$140,000 (1)
755:22
$20 (3)
860:4,5,8
$25.9 (3)
815:5,14,20
$28.8 (1)
816:2
$30,000 (1)
841:7
$36 (1)
814:20
$50,000 (1)
831:3
$51.2 (1)
815:24
$51.3 (1)
815:24
$7.6 (1)
815:14
$7.66 (1)
815:7
$86 (1)
816:20
$90 (1)
788:21
A
AARON (29)
722:10,24;723:4,7;
724:11;726:8;739:19;
775:17,18,18,25;776:2;
777:21,24;778:6,22;
780:1,22;785:10,20;
789:13,14,18;790:16;
794:14,19;894:18,21,
24
abilities (1)
819:21
ability (5)
761:10;763:23;
854:20,21;855:3
able (2)
734:7;764:3
ABM (7)
743:5;745:3,5,5,12;
747:14;866:23
ABMs (2)
880:4,10
above (4)
752:3;869:18;
870:13,14
absolutely (11)
744:3,6;758:10;
761:21;767:14;775:11;
780:2;785:16,17;
810:17;862:1
absorbed (2)
815:4,14
abundant (1)
754:22
accept (3)
763:13,16;844:17
acceptable (5)
734:6,10;735:24;
736:8;737:13
accepted (1)
894:11
accepting (1)
863:3
access (4)
796:11;824:11;
835:20;867:2
accessing (2)
743:7,10
accompany (1)
771:14
accordance (2)
808:7;835:8
according (1)
778:22
account (3)
732:2;816:14,16
accounting (10)
801:19,20,22,23;
802:12;806:19;861:4,
7,9;862:6
accounts (1)
892:3
accumulated (1)
879:16
accuracy (3)
764:11;836:22;
893:23
accurate (6)
789:15;853:9,11,14;
854:14;862:3
accurately (1)
794:14
achieve (1)
879:22
acknowledge (1)
867:3
across (4)
733:2;746:4;761:17;
766:8
act (2)
745:6;860:23
acting (1)
864:23
action (1)
831:3
active (2)
814:11;816:16
activities (2)
801:13,22
actual (8)
724:18;734:14;
739:22;740:10;762:9;
769:4;832:18;870:7
actually (29)
728:10;734:9,19;
735:10;736:10;743:9;
749:1;758:3;762:10;
765:8;771:4;773:18;
775:20;783:21;790:14;
796:7;807:18;819:20;
822:6;830:7;840:17;
849:15;850:6;854:1,
15;873:6;876:15;
882:8,15
ad (1)
802:5
add (3)
832:20;838:12;841:2
added (2)
832:21;872:12
adding (1)
892:9
addition (3)
783:9;816:18;878:4
additional (17)
745:7;811:19;814:5,
8,10,23;815:2,8,20,25;
816:9;831:10,18;
872:11;880:2,3,8
Additionally (1)
781:5
address (5)
748:14,19,22;
823:14;862:4
addressed (1)
745:20
addressing (1)
738:2
adds (1)
811:19
adequate (4)
781:14;783:15;
789:21;790:10
adhere (1)
837:12
adherence (2)
729:23;730:6
adjourn (1)
794:12
Adjourned (1)
895:16
administration (1)
800:19
admissibility (6)
725:11;743:23;
746:19;752:23;769:20;
775:12
admissible (1)
847:12
admission (2)
846:25;862:20
admit (3)
813:13;839:18;888:2
admitted (1)
762:22
advancing (1)
848:9
adversary (4)
748:13;752:24;
767:25;797:3
adverse (4)
782:1;783:7,8,21
advise (1)
728:21
affect (2)
795:6;812:19
affects (1)
795:2
affirmation (1)
794:10
affirmations (5)
792:16,21,23,25;
793:9
afoul (1)
789:5
afternoon (5)
797:23;799:1;800:7;
853:5;863:22
again (49)
734:1;738:17;745:1,
2;747:9,16;751:1;
752:18;755:1;757:4;
760:24;767:12;768:6;
769:14;771:5;775:4;
779:10;783:1,5,9;
787:5;793:4,11;
795:17;806:1;807:7,
22;808:3,6,10,11,13;
809:25;810:9;811:17;
812:2,12;814:24;
815:10;819:22;820:1,
13;821:24;822:4;
825:25;827:17;830:10;
835:1;851:20
against (6)
749:19;839:8;
854:16;855:21;856:13;
857:22
agencies (7)
803:9,12;805:3;
806:8;808:4;824:10;
832:7
agency (7)
803:4,6,16,21;804:4;
805:12;884:25
AGM04596930 (1)
848:14
ago (6)
729:4;752:21;
778:10;841:10;856:8;
886:6
agree (12)
725:12;728:1;769:3;
778:9;784:23,25;
787:10;792:24;804:14;
843:16;863:5;887:13
agreeable (1)
799:17
agreed (8)
732:19;742:11;
743:5,9;748:23;763:2,
21;764:18
agreeing (1)
774:3
agrees (3)
763:19;773:23;
887:20
ahead (13)
722:9;737:17;747:3;
774:19;788:7,7,7,7;
794:13;840:15;841:16;
856:9;870:8
allegation (1)
834:9
allocates (1)
837:13
allow (10)
807:8;821:16,18;
823:6;866:4;868:11;
869:16;872:4;882:15;
885:15
allows (2)
773:10;810:25
almost (2)
755:24;807:2
along (6)
764:24;778:1;
789:11;837:21;841:20;
843:13
alongside (1)
809:4
alternatively (1)
743:20
although (8)
725:20;734:19;
738:17;739:16;749:8;
771:16;780:18;861:16
altogether (4)
725:21;800:14;
816:17;869:20
always (6)
769:18,19;787:17;
832:11;863:2;876:12
amalgamation (1)
774:13
ambiguous (2)
792:5;870:18
American (1)
801:1
Amongst (1)
881:16
amortization (8)
811:5,6,9,12,14;
812:7;814:6;817:12
amount (24)
749:24;754:15;
783:24;788:13;807:17;
814:23;815:3,9,15,16,
Min-U-Script® SOUTHERN DISTRICT REPORTERS (1) $10,000 - amount
25;816:1,3,6,10,10;
825:24;826:4;849:25;
850:21;851:15;867:15;
881:25;887:3
amounts (3)
810:13;816:13;
833:25
analogy (1)
804:8
analyses (1)
835:24
analysis (23)
732:17;733:10,15,
22;750:18;770:8;
771:8;786:1;790:20;
791:1,3;796:10;
802:10;834:24,25;
862:6;865:12;878:20;
879:8,11,14;881:10,18
analyst (2)
801:22;849:3
analysts (6)
802:4;819:21;
822:16,16,20;849:4
analyze (1)
877:20
and/or (2)
835:8;880:8
anecdotal (3)
731:4;758:8;759:17
answered (3)
742:9;744:2;892:15
anticipate (1)
894:22
anti-money (1)
867:1
apologize (3)
785:16;840:1;846:12
app (1)
890:21
apparently (3)
731:19;741:2;748:4
appeal (1)
753:2
appear (4)
755:18;796:5;890:6,
16
appeared (2)
849:14;850:6
appears (5)
750:14;849:24;
850:20;886:9,10
apples (1)
788:6
applicable (1)
740:25
applicant (1)
767:5
application (12)
749:12;855:9;
882:20;883:2,25;
884:9;885:13,23;
886:13;887:14,17;
891:23
applied (5)
727:1;761:12;
780:23,24;827:2
apply (5)
735:12,12;743:21;
760:18;827:3
Applying (2)
783:22;874:6
appraisal (13)
741:11;755:22;
865:12;876:1;878:20;
879:2,5,7,8;880:9,13,
14,19
appraisals (4)
743:4;877:20;
879:11,14
appraiser (4)
879:15,25;880:1,8
appraisers (3)
879:15;880:14,20
appreciate (1)
889:24
apprentice (2)
864:24;865:9
approach (24)
730:20,24;736:6,7;
738:5,6,12;741:6,7;
744:7;751:2;752:7,17,
17,22;753:15;754:19;
761:16;765:4;812:24;
817:15;845:5;882:12;
887:5
approached (1)
744:23
approaches (1)
848:10
appropriate (12)
736:9;763:18;774:9;
776:10;799:18;820:2,
2;822:4;832:7,19;
851:24;881:10
appropriately (1)
788:17
approval (2)
831:13;832:16
approve (1)
837:9
approved (5)
831:12,20;833:3;
858:10;890:1
approving (1)
880:9
approximately (7)
755:9;795:4,15;
865:16;870:5;877:3;
881:4
area (6)
740:17;762:21;
805:18;844:17;862:5;
880:5
arena (2)
762:17;843:9
arenas (1)
762:18
arguably (2)
836:6;841:21
argue (1)
726:6
arguendo (1)
848:8
argument (13)
725:10;726:11;
728:24;734:3;775:16;
779:25;784:23;797:6;
805:20;818:21;837:21;
838:11;841:20
argumentative (1)
854:24
arise (1)
814:8
around (12)
802:23;815:12;
828:1;866:20,24;
867:3;875:25;878:19;
880:20,24;885:8,25
arrangement (1)
860:24
arrived (1)
880:1
arrives (1)
783:7
arrow (1)
773:11
art (1)
865:22
articulate (8)
730:25;731:2;
735:14;741:16,17;
761:11;774:10,11
articulated (3)
735:3,21;737:7
articulating (2)
738:13;842:12
articulation (1)
762:19
ascertain (2)
723:18;776:6
aside (4)
734:18;768:17;
844:12;885:10
aspect (3)
821:16;862:5;877:13
aspects (5)
821:15,17;827:12;
835:6;840:16
assemble (2)
819:24;820:17
assembled (3)
724:19;771:21;832:6
assert (1)
837:17
asserting (2)
848:1,2
assertions (1)
747:2
assess (2)
784:7;879:24
assessed (2)
793:16,19
assessing (3)
806:16;880:6,7
assessment (1)
848:9
Asset (8)
801:1,7,10,15;
817:18;818:3;868:25;
875:21
assets (3)
745:18;759:10;
823:23
assignment (3)
726:12;730:21;
836:18
assist (1)
729:14
assistance (2)
805:19,24
assistant (3)
865:2,7;877:18
associated (6)
763:15;796:16;
798:7;806:19;867:21;
882:5
assume (7)
733:12,21;734:3;
860:25;891:18;892:21;
893:9
Assuming (8)
732:13;787:16;
838:11;847:11;848:8;
858:16,19;885:22
assumption (7)
787:15;812:21,21;
857:20,21;858:15;
860:11
assumptions (8)
812:16,18;857:7;
858:2,6,9,12,13
assure (3)
875:10;876:8;886:2
Assured (27)
722:18;723:16;
753:21;754:17;767:20;
783:23;788:13,19,21;
795:5;796:17;816:14;
835:19,19,23;836:23;
837:7,8;838:5,18,25;
839:22;840:7,22;
857:21,22;861:24
Assured's (6)
724:1;753:14;767:9;
836:18;838:7;840:25
attached (1)
867:17
attack (6)
742:21;744:12;
757:17;759:20;775:6,7
attacking (1)
744:12
attempt (3)
735:17;741:11;
744:14
attempted (1)
736:3
attention (8)
748:21;749:3;750:1;
754:24;848:4;849:9;
886:21;894:8
attorney (1)
734:21
Attorney's (1)
889:21
attributes (2)
796:18,24
audited (2)
818:6,8
auditorium (1)
877:10
auditors (1)
818:9
Australia (1)
800:24
authority (1)
866:13
automated (5)
743:3;822:2;831:13,
20;880:4
availability (3)
820:15;827:18;847:5
available (5)
731:20;752:9;813:9;
832:11;877:24
average (3)
733:16;787:6;878:10
AVM (5)
755:22,23;756:24;
760:22,23
avoids (1)
847:7
aware (7)
725:8;739:5,8;784:2;
805:10;820:24;861:22
awareness (1)
741:8
away (2)
840:3;886:4
AYM (1)
781:23
B
bachelors (1)
800:18
back (51)
728:15;732:9;733:1,
3;734:12;735:24;
738:16;743:14;744:25;
745:3;748:13;750:11,
16;752:11;755:20;
757:9;759:2;760:11,
15;763:6,10;764:1;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (2) amounts - back
775:25;777:16;786:4;
787:3;788:11;792:6;
798:4;802:14,15;
820:10;822:13;832:18,
21;836:20;838:15,21;
842:20;846:8;854:1,3,
5,5;859:11;864:18;
878:14;880:10;886:8;
891:3;893:5
back-and- (1)
844:22
background (3)
800:17,21;803:20
back-up (3)
824:16,17,18
bad (7)
737:25;743:19;
754:13;755:14,21;
767:17;784:12
balance (18)
760:18;782:10,12;
783:7,8;801:11;
806:21;814:23;815:2,
8,25;816:9;826:24;
827:21;867:17,19;
868:22,25
balanced (1)
729:1
balances (3)
783:6,6;814:8
bands (1)
871:8
Bank (19)
724:9;800:12,25;
802:16,17,19,20;
833:21,22,24;834:17;
863:2,25;864:7;
868:25;869:23;871:20;
872:18,22
banker's (1)
863:4
banking (3)
802:20,22,24
banks (1)
743:18
BAS (2)
813:17;856:20
base (2)
733:24;850:18
based (19)
747:9;754:14,19;
761:18;776:10;781:17;
791:19,20;792:10,11;
810:3;818:20;819:6;
835:6;837:1;859:12;
860:11;880:9;886:3
bases (1)
835:25
basic (4)
754:24;808:19;
816:10;823:16
basically (14)
724:1;774:7;777:19;
787:10;803:9;805:4;
810:12;817:9;818:13;
820:18;829:1;832:1;
840:12;872:16
basing (8)
782:4,6;791:13,16,
21;792:3,7,12
basis (18)
731:11;735:14,22;
740:11;759:3;796:19,
20;812:2;815:1;
822:10;836:21;843:2;
847:13;848:7;849:12,
21,25;850:21
batch (1)
822:1
Bates (2)
848:14;883:3
BBB (2)
887:15;888:12
BBK (1)
783:1
bear (1)
837:14
Beard (10)
799:14;836:13;
843:12;844:24;846:18;
848:21,22;849:11;
850:2;851:7
Beard's (1)
849:9
bears (2)
843:15;848:14
became (1)
865:1
becomes (2)
811:23;814:7
began (1)
802:9
begin (3)
779:24;839:7;852:5
beginning (2)
781:1;893:11
begins (1)
891:4
behalf (2)
775:19;811:20
behind (5)
731:6;755:19;
758:11;773:11;808:10
belief (2)
739:3;844:6
bell (1)
787:14
Bellevue (1)
876:23
belongs (1)
757:2
below (2)
814:12;871:9
Bench (3)
727:20;784:3;793:7
beneficial (1)
814:8
benefit (5)
782:7;802:11;
817:13;848:9;861:5
benefits (3)
807:16;821:6;861:8
bereft (1)
764:15
Berry (2)
885:13,22
best (11)
741:15;746:9,10;
758:3;769:19;772:23;
848:2;853:20;859:13,
13;880:21
better (3)
736:4;806:3;877:20
beyond (2)
735:7;843:14
big (11)
729:6;763:20;
769:14;772:9;773:11,
19,24;778:14;785:25;
876:25;877:1
binary (7)
776:22;777:7,12,14,
17;778:3;787:11
bit (10)
729:12;737:10,11;
802:14;860:4;861:16;
864:18,19;865:24;
872:13
blatant (1)
757:10
blended (1)
840:17
blindly (1)
732:17
blink (1)
755:2
bluntness (1)
756:2
blush (1)
755:17
board (3)
746:4;766:9;792:15
body (1)
763:17
Bohan (1)
836:15
boiled (1)
776:18
boils (1)
761:19
book (2)
816:6;821:7
booked (1)
818:3
booking (1)
817:17
books (1)
817:20
borrower (24)
739:15,22;740:16;
741:3;742:14,17;
748:19,24;750:19;
759:10;760:8;762:23;
823:14,15;829:1,2;
868:15;884:5;885:3;
889:16;891:11;892:18;
893:8;894:4
borrowers (5)
740:13;868:18;
871:1,11,13
borrower's (1)
884:4
boss (1)
895:2
both (10)
749:19;771:4;
775:15;792:17,25;
822:19;836:13;857:15;
881:23;889:17
bothered (1)
735:1
bottom (10)
782:24;809:25;
810:9,11;813:21;
817:1;846:15;849:9;
883:10;892:24
box (1)
749:11
branch (1)
749:9
branches (1)
802:24
breach (22)
750:24;756:12;
758:10,24;759:4,25;
766:12;776:17,21,23,
24;777:1;778:5;779:1,
13,13,14,16,17;780:14;
783:7,21
breached (7)
754:13,16;762:20;
766:25;769:7;837:17;
839:14
breaches (7)
744:20,21;755:14;
776:7;780:13;783:5;
838:25
breadth (4)
743:8;747:18;796:9,
17
break (15)
758:11;759:1;771:1;
793:23;794:24;798:11;
852:5,6;865:24;
870:20;872:13;875:19;
878:24;881:12,13
breakdown (1)
723:12
Brewer (2)
767:9;796:22
brick (1)
840:19
bricks (1)
835:12
briefly (4)
774:18;791:6;798:6;
799:13
bright- (1)
778:10
bring (4)
735:10;749:3;
788:11;877:22
brings (2)
731:8;811:10
broad (2)
757:16;789:5
broader (5)
735:25;766:22;
767:2,21;785:15
broker (25)
749:2;849:22;
850:19;871:24;872:18,
19;873:1,9,14;874:3,6,
13,15;875:12;876:11;
883:16,17,19,20,21;
889:3,11,18;890:22;
894:10
broker-correspondent (1)
873:13
brokers (7)
873:5;874:1,17,24;
875:7,8;876:5
brought (7)
727:10;740:25;
745:2;781:1;783:20;
841:18;894:8
bubble (2)
755:15,16
BUCHDAHL (101)
722:6,20,22;724:12,
17;725:14,17,22;
726:2;741:4;743:15;
744:9;745:15,24;
746:13,17;747:4;
748:14;749:11,15,21;
753:8;754:1;755:9;
757:21;760:16;765:13,
23;766:4;767:14;
770:2,4,14,19,22;
771:9;772:1;773:16;
774:18,20;784:10,21;
785:8;788:1,9;791:6,
22,24;792:15;794:6,
24;795:13,23;796:1;
797:15,18;798:5;
799:22;803:17;804:9,
19;805:8,20;807:5,7;
813:14;818:19;820:4;
821:8,12;824:14,16,18,
24;825:12,16,18;
839:7;840:14,16;
841:15,17;842:8,22;
845:7,9;846:5,25;
852:4;853:4;855:2,15;
856:11;862:7,10,19,22,
Min-U-Script® SOUTHERN DISTRICT REPORTERS (3) back-and- - BUCHDAHL
23;863:9;895:3,9
Buchdahl's (1)
804:2
bucket (2)
737:15;842:9
budgets (1)
728:20
building (4)
807:12;808:25;
835:12,12
built (3)
790:6,7;858:15
bunch (6)
739:7;740:15;
742:10;762:13;774:1;
883:3
burden (4)
747:16;788:2,4;
823:15
Bureau (1)
752:9
business (30)
740:20;800:19;
803:2,3,20;845:16,17,
21,23;846:10;847:20;
863:3;871:13;874:7,
15,22;875:3;876:2,7,8,
9;878:5;881:6;884:23;
885:2;886:18;888:4,6,
7,10
buy (1)
748:4
byproduct (1)
807:10
C
calculate (3)
777:15;780:8;790:23
calculated (2)
780:14;783:11
calculates (1)
782:10
calculating (3)
781:17;806:21;812:5
calculation (8)
777:10;779:2;
787:23;792:3;849:24;
850:20;865:12;878:20
calculations (5)
781:6;791:13,16;
792:7;826:2
California (1)
864:25
call (14)
726:3;737:18;
748:18;799:6,7,25;
800:1;842:8;847:4;
848:3;863:14,15;
882:21;891:4
called (13)
727:13;782:15;
800:3;811:4;828:19;
839:2;858:21;863:18;
870:12;875:16;892:3,
8,14
calling (1)
799:14
Calls (3)
856:1;892:12,21
came (20)
732:24;737:16;
750:5;752:7;755:18;
757:9;761:7,8;783:17;
796:17;831:2;834:6;
837:6;838:18,21;
841:4;847:19;865:25;
866:9;886:20
can (82)
722:22;732:2,8;
735:23,24;737:25;
739:11;743:8;744:22;
747:1;748:24;753:5;
754:14,21;756:17;
758:23;759:20;760:15,
16,17;761:11,12;
769:22;770:2;772:2;
777:20;778:12;784:7;
785:4;786:3,5;787:2,
16,17,18;788:11;
790:1;792:20,25;
794:4;795:19;797:23;
798:12;799:12;800:21;
801:8;805:21;809:23;
813:19;819:8,18;
835:2;840:12;843:17;
844:11;845:12,17;
847:3,4;848:2;852:4,5;
865:24;866:9,19;
867:13,15;868:13;
869:12;872:6,22;
875:19;876:17,21;
878:24;880:11;881:2,
20;884:14;885:1;
887:17;888:7
candidates (6)
818:16;820:3,25;
821:23;822:5;831:23
Capital (24)
732:21;734:25;
735:16,21;742:25;
745:5,5;746:13,14,16;
747:14;755:23;760:21,
22;770:12,17,22;771:2,
4;800:12,15;801:16;
865:6;866:19
caps (2)
869:20;870:12
care (1)
843:25
career (2)
828:9;868:15
careful (3)
748:9;751:2;834:24
carefully (2)
744:22;793:11
carelessly (1)
834:22
carry (2)
785:14;819:12
carrying (1)
817:20
case (59)
727:2,24;728:4,12;
729:6;731:9,11,22;
732:21;734:13;739:3,
7,9,10;740:25;745:23;
746:3,15,21;747:14;
749:19;761:13;764:8;
765:7,23;775:9;
776:11;784:14;788:11;
789:8,9,20;790:11;
793:6,14;798:10,13;
799:11;802:2;804:10,
13;809:9,14;811:12;
825:7;828:18;839:1;
841:1;844:7;851:22;
875:22;879:10,13,18,
20;880:17;882:24;
886:10;890:5
cases (5)
766:24;767:1;776:3,
6;805:3
cash (21)
806:25;807:17,24;
808:6;809:10,15,16,20,
20,21,21;810:14;
811:7;812:12,13;
815:11;849:16,22;
850:18;861:5,7
cast (1)
753:2
catch (1)
760:23
catching (1)
740:19
categories (6)
741:19;742:18;
763:20;779:13,14;
835:6
category (5)
723:13;763:6,8,12;
766:21
cations (1)
835:25
causation (1)
839:15
caused (5)
811:13;826:17;
839:2,9;844:11
caution (1)
823:5
caveat (2)
787:10,20
cease (1)
893:5
cell (1)
892:1
center (1)
865:3
centers (1)
877:12
centralized (1)
874:4
certain (8)
753:2;776:3;778:24;
811:2,3;837:12;
861:23;874:19
certainly (16)
734:23;747:5;
753:11;756:15;792:18,
20;867:23,25;871:9;
875:10;876:2,7;877:9;
880:17;882:9;887:17
certainty (2)
790:2,13
cetera (2)
738:22;884:11
challenge (7)
744:14;747:22;
756:20,24;757:1,3;
787:17
challenged (4)
755:14;757:4,18;
775:4
challenges (1)
775:17
challenging (2)
777:3;879:11
change (7)
787:21,23;814:8;
834:16,18;857:11;
870:4
changed (2)
894:2,3
changes (1)
729:4
channel (6)
871:22,23,25;872:2,
18,21
channels (9)
827:4;871:21;
872:12,14,16;873:2,13,
15;876:11
characteristic (1)
785:13
characteristics (3)
787:18,20;869:12
characterize (1)
809:4
characterized (1)
842:22
charge (1)
722:12
charged (5)
782:3,17;783:3,20;
808:20
charged-off (6)
782:5,6,9,11,12,19
chart (5)
731:3;786:3;847:8;
848:4;850:14
chartered (1)
802:17
charts (4)
741:19,22;763:10,12
Chase (1)
843:19
check (18)
722:16;725:3;
738:20;747:13;766:11;
769:19;771:1;774:24;
836:20;841:5;874:23;
885:18;889:25;890:7,
10,12;893:22,25
checked (3)
854:15;890:13;892:4
checking (6)
724:9;738:21;
855:20;856:13;875:8;
886:11
checks (1)
834:12
cherry-pick (1)
821:6
Chicago (1)
865:19
chief (1)
879:15
child (1)
892:15
child's (1)
764:21
chime (1)
804:1
choice (1)
880:21
choose (1)
858:2
choosing (1)
842:19
chose (3)
757:6;771:17;781:18
chronological (2)
846:14;891:1
circumstance (2)
783:22;790:4
circumstances (3)
764:18;776:18;
780:21
circumstantial (1)
840:8
citations (1)
776:12
cited (1)
734:13
city (1)
886:3
claim (6)
736:19;742:16;
746:3,7;757:1;764:14
claimed (2)
732:1;742:17
claiming (2)
774:14;839:1
Min-U-Script® SOUTHERN DISTRICT REPORTERS (4) Buchdahl's - claiming
claims (12)
730:14;731:25;
732:22;733:24;741:14;
772:22;773:15;780:24;
788:19,22;810:8;
857:21
clarification (1)
873:24
clarity (1)
769:25
classes (1)
865:1
classic (1)
888:6
classroom (1)
865:11
Clayton (1)
836:15
clean (5)
758:18,20;759:4,14,
21
cleanly (2)
757:22;758:5
clear (37)
729:22;732:21;
734:25;735:16,21;
738:10;742:25;744:16;
745:4,5;746:13,14,16;
747:14;754:23;755:23;
760:4,21,22;761:2,11;
762:2,19;770:11,12,16,
22;771:2,4;774:11;
785:10;791:9;794:10;
796:25;816:21;835:8;
847:24
cleared (1)
811:14
clearing (1)
763:24
clearly (5)
726:15;732:10;
801:23;821:23;846:24
clerk (1)
758:20
click (1)
722:24
client (3)
777:6;783:24;784:15
close (6)
726:2;766:15;793:6,
18;811:10;834:5
closed (4)
745:23;766:17;
809:5;854:10
closely (2)
802:6;826:1
closer (4)
756:6;803:25;836:6;
878:11
closing (9)
762:23;787:5,7;
838:5;864:6;872:9,9,
20;890:10
CLTV (10)
745:19;750:15;
753:11;754:8;843:2;
869:17,20;870:13;
871:1;882:14
CLTVs (2)
867:25;868:7
CLTV-type (1)
868:2
co-borrowers (2)
823:25;824:1
coding (1)
819:21
collateral (44)
796:10,19,24,24;
809:9,11,13,15;811:24,
25;812:1;814:25;
815:4;816:24;817:8,9,
10,15;823:15;826:3,4;
836:1,2,25;837:9,9,25;
838:18,20;839:5;
843:8,11,20,25;844:7,
8,14;851:21,23,25;
853:11;858:22;859:13,
18
collateral-compliant (1)
838:3
colleague (1)
778:18
colleague's (1)
779:25
collected (1)
853:17
collection (3)
887:12;888:20;889:5
college (1)
780:19
colloquy (1)
840:11
co-located (2)
877:10,18
column (1)
783:2
columns (1)
857:4
com (6)
737:18,19;738:4;
740:10;742:13;745:11
combination (1)
788:23
combinations (1)
882:14
comfort (1)
756:11
coming (11)
737:1;758:12;
759:17;772:1,8;796:5;
809:10;836:2,24;
837:24;843:11
co-mingled (1)
723:15
comment (1)
891:11
commentary (1)
772:20
commenting (1)
780:16
comments (8)
727:16;760:6,7;
770:10;772:19;773:24;
839:19;840:2
committee (2)
869:23;870:1
committees (1)
858:11
Common (1)
764:4
commonly (5)
803:10;806:24;
809:22;810:1,21
common-sense (1)
753:2
communication (1)
822:23
community (1)
735:25
companies (2)
805:3;879:19
company (18)
746:12;748:6,18;
749:7;768:23;806:7;
811:20;814:7,9;
828:14,15,16;863:24;
864:1;885:14,24;
886:3;892:16
comparable (1)
880:20
comparative (1)
756:25
compared (3)
728:10;782:11;837:1
comparison (1)
788:6
compensating (1)
759:8
compensation (3)
807:21,22,23
complete (4)
749:23;761:4;
851:19;892:25
completed (4)
733:14;749:12;
865:14;879:25
completely (3)
764:25;779:17;846:7
complex (2)
779:5,6
compliance (1)
722:16
compliant (2)
837:25;838:19
complicated (2)
793:5;840:1
complied (1)
724:21
component (5)
772:20;797:1;
806:15;881:12,13
comported (1)
777:8
composed (1)
739:4
compress (1)
766:21
comprise (2)
864:6,11
comprised (1)
723:13
comprises (1)
879:7
comps (1)
756:25
computer (3)
765:25;840:23,25
computerization (1)
833:10
conceded (1)
736:11
concept (4)
734:12;735:10;
808:19;812:15
concern (2)
744:8;795:16
concerned (1)
863:5
concerning (1)
776:7
concise (3)
727:8;774:11;799:11
conclude (4)
754:14,21;770:5;
885:1
concluded (1)
733:7
conclusion (3)
747:7;766:7;770:4
conclusions (2)
747:21;814:12
conditions (1)
807:15
condo (1)
879:9
conduct (2)
841:22;877:11
conducted (2)
729:15;881:8
conducting (3)
785:19;876:9;881:15
conference (1)
794:20
confidence (11)
761:5;781:15,15;
787:13,21,22;788:3;
789:24;790:8;791:7;
836:23
confident (5)
745:1;772:3;781:8;
854:10,12
confirm (9)
732:14,15;842:20;
849:15,21;850:17;
862:1;887:16;893:9
confirmed (2)
838:22;841:3
confirming (4)
723:14;778:9;885:8;
889:17
conform (1)
803:7
conformance (1)
724:22
confuse (2)
775:1,1
confused (1)
773:22
confusing (1)
774:25
confusingly (1)
773:20
confusion (1)
839:19
connected (1)
827:24
connection (5)
735:1,17;746:6;
805:7;813:16
consequence (3)
795:18;861:1,4
conservatism (1)
869:3
conservative (3)
865:21;869:1;882:11
consider (4)
750:20;792:20,25;
794:4
considerably (1)
742:21
considered (2)
738:14;833:5
considering (1)
792:21
consistency (7)
738:4;866:15;877:8,
13,16,23,23
consistent (7)
738:1;744:1;753:5;
765:4;787:3;826:2,6
consists (1)
723:14
consortium (1)
875:22
constant (2)
822:23;858:18
constituencies (1)
824:8
constructed (1)
835:14
constructing (1)
785:17
construction (5)
809:3;838:17;
840:18;841:18,25
Min-U-Script® SOUTHERN DISTRICT REPORTERS (5) claims - construction
consulting (2)
729:16;743:17
consumer (5)
871:20;873:11,12;
881:25;889:10
consumers (2)
875:5;881:4
contact (6)
764:2,4;806:12,13;
873:11,12
contacted (1)
891:11
contained (2)
807:14;835:14
content (2)
822:12,13
contents (1)
844:23
context (2)
764:19;776:11
continue (5)
814:10;823:6;
859:10;887:7;894:14
Continued (7)
751:3;786:11;
798:18;829:6;852:8;
858:19;886:24
continuing (1)
860:22
contract (5)
729:23;837:11,16,
17;839:14
contractual (2)
767:16;788:23
contributed (3)
815:2;816:17;839:18
contribution (1)
807:21
contributions (1)
810:8
control (9)
722:13,17;725:1,3;
741:8,9;754:12;
762:14;768:14
controls (1)
741:7
conventional (1)
867:6
conversations (6)
823:4;844:22;845:1,
3;847:18;851:4
convince (1)
835:2
copied (1)
845:12
copy (2)
748:16;785:8
core (4)
803:2,3,20;882:16
corner (1)
781:24
Corp (3)
881:10,14,18
corporate (3)
722:8;740:20;881:14
Corporation (4)
800:12,24;881:19;
885:2
corporations (1)
881:10
correctly (3)
731:23;758:3;765:21
correspondent (15)
849:23;871:25;
872:21,21,24;873:2,14,
17;874:3,6,13,15;
875:13;876:11;883:16
correspondents (8)
850:19;873:5;874:2,
17,24;875:8,9;876:5
corresponds (2)
849:20;850:12
cost (4)
847:12;848:7;
849:21;850:17
costs (1)
728:21
counsel (53)
722:4,11;723:3;
724:1,16;725:17;
726:1;727:16;731:21;
743:14;745:4;747:22,
24;749:23;750:10,23;
752:13;756:17,19;
757:7,19;764:4,5;
765:12,15;770:25;
771:23;775:15;778:19;
783:20;784:20;786:6;
793:15;794:1,2,7;
799:13;839:6;840:2,
17,19;841:16,18;
842:5;846:20;856:21;
857:1;870:8;883:5;
887:20;889:13;894:8;
895:6
counsel's (4)
725:10;749:6;
784:23;798:2
count (4)
781:25;782:2,17;
783:2
countenance (1)
768:5
counting (1)
762:22
country (1)
877:20
counts (2)
743:14;846:9
couple (7)
731:3;765:13;
775:19,21;834:19;
853:6;868:16
course (16)
727:15;755:7;
780:19;784:11;785:19;
799:17;819:13;827:23;
828:5;831:3;841:10;
845:21,23;865:13;
890:6;891:22
court (328)
722:2,3,9;723:3,6;
724:5,16;725:12,16,21,
24,25;726:4,15;727:6,
15;728:23;729:22;
730:4;731:23;732:2,
11,13;733:11,18;734:1,
3,18;735:6;736:1,24;
737:2,16,20;738:8,16;
739:1,9,13;740:2;
742:20,22;743:13,22;
744:8,22;745:13,23;
746:1,8,14,18,24;
747:23;748:8,11;
749:5,14,17;752:21,24;
753:19;754:14;755:8,
18;756:11;757:19;
759:5;763:14;764:2;
765:1,11,20;766:2;
767:11;768:2,7;
769:21;770:3,5,18,20,
24;771:22;774:19,20;
775:14,24;776:1;
777:16,23;778:1,9;
779:10;780:18;784:19;
785:6;787:8;788:6;
789:12,17,19;790:14;
791:5,12,23;792:5,20,
24;793:7;794:7,8,13,
18,20,22,23;795:5,8,9,
18,21,24;796:2;797:2,
9,14,17,19;798:14;
799:4,5,10,21,23,25;
803:18,24;804:14,21;
805:9,22;807:6,8;
812:25;813:16;819:10;
820:5;821:9,14;822:6,
10,14,17,21;823:5;
824:15,17,21;825:1,13,
17,20;826:8,11,13,20;
827:1,6,8,12,22;828:2,
4,9,13,18,22;829:2;
830:1,5,9,12,16,19,24;
831:2,9,15,21,24;
832:3,8,13,20,25;
833:5,8,19;834:1,8,25;
836:6,11;837:11;
838:11;839:6,12,18;
840:15,24;841:9,14,16;
842:11;843:13;844:16;
845:6,8,10,14,17;
846:13,17,23;847:2,11,
20;848:16,18;850:5,10,
16,25;852:3,6;853:1;
854:25;855:12,25;
856:2;862:9,14,16,21;
863:8,10,12,14;866:4;
868:11;869:6,22,24;
870:2,8,17;872:4;
873:23;875:19;881:22;
882:2,6,11,19,24;
883:1,8,13,17,20,24;
884:3,9,14,18,24;
885:5,10,17,17;886:2,
5,16;887:1,6,18,20;
888:1,5,7,11,16,18,22,
25;889:13,19;890:6,11,
16,19,25;891:3,8,12,
19,22;892:2,8,12,14,
20,24;893:4,11,14,18,
22;894:1,7,15,20,23;
895:1,7,11,15
courtroom (1)
735:2
Court's (2)
839:17;848:9
cover (2)
742:21;761:23
coverage (1)
876:23
covered (2)
839:21;840:24
covering (1)
877:19
covers (1)
752:1
create (3)
857:24;858:7,9
created (2)
807:11;842:14
creates (1)
869:22
creating (2)
805:4;871:5
creation (1)
853:23
creative (1)
764:9
credentials (1)
874:5
Credibility (1)
732:2
credible (2)
879:24,25
credit (31)
747:13;748:7;754:7;
755:3;758:16,22,23;
759:9;805:2;811:13,
19;814:5;815:13,18,
20;816:11;824:2;
862:25;863:2,3;864:2,
13;866:10,13;867:14;
869:23,25;872:22;
874:9,23,23
critical (5)
726:15;788:15;
790:18;812:16,18
critically (2)
754:4;789:3
criticize (1)
768:2
cross (7)
749:25;752:19;
755:7;769:8;785:10;
821:17;853:3
cross- (1)
769:18
cross-examination (4)
744:14;755:13;
852:3;853:2
cross-examined (2)
745:21;773:18
crunching (2)
771:3,5
culled (1)
729:15
culture (4)
866:8,10,16,17
cum (2)
849:20;850:13
cumulative (2)
849:18;850:11
cured (1)
733:23
current (14)
740:10,11;748:20;
783:22;800:10;821:25;
858:17,17;859:12,12,
14;861:18;864:9,11
currently (5)
815:18,20;861:19;
863:24;878:22
curve (2)
787:14;858:21
cusp (2)
755:16;756:9
customer (2)
889:2;890:22
customers (2)
878:4;890:14
cut (6)
728:21;759:4;
772:16;799:20;819:25;
852:4
cutoff (1)
737:24
cutting (1)
728:20
CV (5)
727:11;728:6,8,16,
17
D
Dallas (1)
876:23
damaged (1)
782:9
damages (17)
776:6;780:24;781:6,
17;782:4,6;783:24;
784:1,16;787:23;
789:9,11;790:23;
791:13,16;792:3,7
data (107)
Min-U-Script® SOUTHERN DISTRICT REPORTERS (6) consulting - data
742:8;743:5;745:7;
750:19;752:10;765:18,
20;768:19;770:9;
771:2;796:12,12,13,18;
798:8;802:4,6,7;806:5;
818:13,15,17;819:22,
24,25;820:15,15,16,17,
18;822:12,13,24;
825:10,23,25,25;826:5;
827:16,17,20;832:1,3,
3,5,6,8,10,11,17,17,20,
21,24;833:8,14,17,21,
23;834:12,14,17;835:1,
4,4,6,7,14,15,18,20;
836:21,22,25;837:2,5,
6;838:17,22,23;841:5;
842:15,15,21,21,22;
843:1,17,18;845:4;
849:18,19;850:11,12;
851:18,19,22,24;853:6,
10,11,12;854:2,13,13;
856:13,18
database (9)
740:15;742:14;
834:15,16;875:15,22;
890:14,21,23
databases (3)
740:21;741:2;765:25
data-gathering (1)
849:5
date (12)
741:14;759:6;
781:18,18;783:3;
785:5;813:7;814:18;
815:7;832:1;838:5;
888:23
dates (1)
857:8
Daubert (7)
722:4;732:3;735:23;
736:4,7;792:20,24
daughter (1)
764:21
Dave (1)
844:24
Dave's (1)
848:25
David (2)
799:14;843:12
day (6)
727:6;730:14;767:9;
797:20;838:1;843:25
days (2)
785:24;798:2
deadlines (1)
824:4
deal (16)
802:13;806:10;
808:21;810:14;811:21,
25;812:9,13;815:12;
816:5,11;817:16,22;
857:8,17;859:5
dealing (2)
778:15,16
deals (2)
812:6;862:2
dealt (7)
795:10;798:1;
801:11;802:4;805:12,
15;848:23
Dearborn (1)
748:21
debt (11)
750:13;753:11;
757:1,2;762:21;763:4,
5;768:18;771:13;
773:12;823:15
debts (6)
747:13;755:3;
757:12;762:22;766:11;
875:4
debt-to-income (1)
843:3
December (3)
723:9;857:5;859:2
decide (3)
729:20;746:21;
768:20
decided (2)
759:18;763:14
decision (13)
733:24;758:13;
761:7,8;768:7;776:22;
777:7,12,14;778:4;
823:18;827:20;879:14
decisioning (1)
879:12
decisions (1)
737:1
declaration (2)
779:4;794:15
declared (1)
812:8
declined (1)
811:12
declining (1)
880:9
deemed (2)
836:3;881:4
deep (1)
843:7
default (5)
868:6,6,9,18;871:7
defaulted (3)
767:8;786:7,10
defaulting (1)
767:19
defaults (3)
767:7,8;858:19
defect (3)
763:9;787:4,6
defective (2)
730:22;743:20
defects (5)
731:2;741:20;
742:18;763:10;782:13
defendant (3)
746:22;800:3;863:18
defendants (6)
744:12;745:3;
747:15;754:9;765:14;
784:22
Defendant's (6)
783:1,10;813:17;
856:20;887:15;888:12
defense (14)
743:14;747:22,24;
750:23;757:7,19;
770:25;771:23;786:6;
788:11;793:15;798:1;
840:2;895:5
deferrals (2)
847:13;848:7
deficiencies (1)
825:25
deficiency (1)
758:21
deficient (1)
783:10
define (1)
869:13
defined (4)
735:3,6;753:13;
756:17
degree (3)
787:22;800:18;856:6
degrees (1)
777:5
delegated (1)
734:4
delineation (1)
738:12
deliniate (1)
735:18
delinquencies (1)
823:3
delinquency (6)
821:25,25;822:1;
823:2;849:19;850:12
delinquent (3)
786:9;822:25;823:1
deliver (1)
874:6
demonstrate (3)
796:23;838:24;
842:11
demonstrated (10)
729:18;730:11;
734:15;736:18;742:3;
757:5;762:3,7;776:9;
808:5
demonstrates (5)
727:11;741:5;774:8;
838:7;844:13
demonstrating (3)
729:9;837:8;843:7
demonstration (1)
743:11
demonstrative (5)
782:15;804:5;837:9;
839:5;844:8
demonstratively (1)
739:6
denied (1)
837:22
denying (1)
793:13
department (18)
801:14,15,17,21;
802:5;808:22;809:2;
818:12,21,25;819:2;
822:15;825:24;831:8;
858:10,24;869:24;
874:4
departmental (1)
819:22
depend (1)
776:25
depended (2)
776:24,25
depends (5)
777:11;780:8,9;
790:6,6
deposition (15)
722:7,7;724:7;
731:21;732:24;737:6;
744:24;795:5;797:5;
799:15,16;835:17;
842:2;862:8;895:4
depositions (2)
722:5;895:8
deposits (1)
866:25
depth (6)
743:8;796:9,17,23;
837:5;843:7
derogatory (2)
758:22;759:9
describe (17)
734:21;800:17,21;
801:8,21;809:23;
819:18;866:9;867:13;
869:12;876:17,21;
879:5,13;880:16;
881:1,2
described (7)
814:24;834:11;
853:7;865:9;870:11;
884:5;885:18
describing (2)
866:8;893:20
description (2)
833:1;870:7
descriptions (1)
869:15
designated (2)
739:12;835:18
designating (2)
796:15;797:1
designations (4)
724:1;795:15,16;
799:18
designed (3)
731:10;743:17;796:7
desk (1)
769:22
despite (1)
748:7
detail (3)
847:15;851:11,15
details (3)
831:13;832:16;
860:24
detect (1)
880:14
detection (1)
878:22
detective's (1)
767:7
deterioration (1)
871:7
determination (4)
758:13;776:17;
778:12;779:20
determinations (3)
769:6;822:8;844:14
determine (9)
724:21;730:5;
739:25;752:25;778:24;
806:18;843:19;880:2;
884:22
determined (2)
842:18;885:3
determining (4)
789:22;802:11;
806:5;836:3
Detroit (3)
841:6;886:6,16
develop (2)
809:4;858:11
developed (1)
858:9
developing (1)
788:18
development (2)
802:7;819:22
deviation (1)
760:9
dialogue (2)
763:22;764:2
dictate (1)
745:10
differ (1)
808:15
differed (1)
808:18
difference (8)
727:20;755:24;
799:8;815:1;827:19;
830:12,14,20
different (42)
723:12;730:4;737:2;
740:8;742:18;744:4,4;
746:1;748:1;752:4,20;
757:5,9;761:3,8;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (7) database - different
774:13;777:15;779:2,
7,19;780:17;796:25;
804:12;811:17;816:22,
23;819:7;830:1;
832:23;833:12,24;
835:5,14;837:24;
838:15;841:20;843:1,
3;848:16;872:14;
877:19;879:8
differential (1)
760:19
differently (1)
780:15
difficult (1)
789:4
Digital (57)
731:15;732:21;
734:25;735:16,21;
738:10,15;741:1,23;
742:3,11;745:6;
746:12,16;747:10,10;
748:17;750:18,18;
752:18;755:23;760:5,
11,14;761:3,7,20;
762:7,13,16;763:5;
765:16,16,17,18,24,24;
766:3,6;768:19;770:8,
12,17,23;771:6,8,10,
20;772:3,5,20,22,23;
773:4,6,10;775:11
digress (1)
745:4
diligence (26)
724:18;764:1;805:4,
15;836:14,16;837:16;
838:8,23;840:6,13;
841:19,23;842:4,18,20;
844:13;855:14,16,17,
20;856:12;874:2,16;
875:6;876:4
dinner (1)
886:20
direct (14)
729:8;741:18;747:2;
748:21;753:15;755:7;
756:5,9;763:11;
798:10;800:5;845:2;
849:9;863:20
directed (3)
726:13;824:21;891:5
direction (2)
754:13;762:5
directly (8)
746:24;754:5;
774:21;792:16;806:10;
807:9;811:8;826:24
director (1)
800:25
dis-adherence (1)
730:6
disagree (1)
774:5
disappointed (1)
793:22
discourage (1)
795:13
discover (1)
837:18
discovered (1)
885:19
discovery (1)
725:2
discretion (3)
736:15;739:24;
759:13
discretionary (1)
773:8
discuss (5)
730:25;731:1;793:2;
802:14;847:5
discussed (6)
778:19;794:3;796:6,
7,11;845:3
discussing (1)
822:12
discussion (10)
730:12;731:3,5;
743:2;761:2;763:15;
793:8,12;796:22;823:2
discussions (5)
822:13,19,22;
844:24;879:17
dispute (1)
732:7
disputed (1)
732:4
disqualification (1)
728:3
disregard (1)
854:25
disrespectful (1)
731:10
dissected (1)
740:24
disseminated (1)
723:9
dissolution (1)
811:18
distinct (1)
843:23
distinguishes (1)
727:18
divided (1)
779:12
divides (1)
783:7
division (1)
740:20
document (12)
723:18;757:2;813:3,
11,19;845:20,24;
846:11;848:15,16,17;
883:5
documentation (7)
763:21,23;771:5;
872:9,10;874:5;889:8
documents (6)
724:3;725:1;739:12;
767:23;768:3;872:9
dollars (5)
757:13,14;761:18;
766:16;816:15
done (22)
728:25;732:5;733:6;
734:16;740:22;741:16;
742:1;743:4;755:23,
23;756:21;796:10;
803:21,22;821:11,22;
846:6;886:12;890:1,7;
893:22,24
dot (6)
737:18,19;738:4;
740:10;742:13;745:11
double-counting (1)
741:21
double-negative (2)
773:19,21
doubt (3)
753:2;782:8;792:23
down (40)
730:15;740:18,18;
742:18;758:11;761:19;
764:6;776:18;782:2;
788:2;790:2,3;799:20;
807:25;811:1;817:16;
820:2,19,22;843:7;
847:11;848:6;852:5;
859:6,11,16;863:12;
865:24;866:12;867:16,
16;869:16;870:20;
872:13;878:24;881:12,
13;891:12,14;893:7
downturn (1)
868:18
Dr (38)
726:9;777:2,3;
778:23;779:3,9;780:7,
17,22,24;781:1,4,5,7,7,
13,19;782:1,9,18;
783:3,13;786:3;
787:22;788:9;789:16;
790:17,19,19,20,23;
791:1,3,7,24;792:17,
17;794:15
drastic (1)
871:7
draw (12)
759:21;766:19;
811:7,22;814:5,10,12,
18;815:1,22;816:17;
817:14
drawn (4)
743:6;804:8;867:15,
16
drops (1)
782:17
DTI (11)
742:16;745:18;
752:12;753:10;754:7;
756:4,6;766:25;
772:13,14;823:21
dual (1)
811:23
Dubry (1)
723:8
ducking (1)
793:4
due (26)
731:9;764:1;768:1;
774:15;805:4,15;
810:13;836:14;837:16;
838:7,22;840:6,13;
841:19;842:4,18;
844:13;855:14,16,17,
20;856:12;874:2,16;
875:6;876:4
duly (2)
800:4;863:19
dumb (1)
834:14
dump (1)
834:21
duration (1)
860:23
during (7)
729:8;788:11;801:8;
818:20;845:13;849:3;
877:25
Dykstra (1)
849:2
E
eager (1)
793:21
earlier (11)
790:18;814:24;
820:13;821:14;838:14;
847:25;853:7;878:14;
883:5,25;891:12
early (3)
812:8;820:19;867:11
earners (1)
881:24
easy (1)
842:9
economic (10)
802:11;806:16;
808:13,25;821:6;
860:16;861:1,4;
868:17,19
economics (3)
798:9;800:18;857:8
economies (1)
868:4
economy (2)
839:2,10
Ed (1)
782:23
editing (1)
832:4
edits (3)
825:11;832:1;854:13
education (1)
726:23
educational (1)
800:17
effect (2)
753:20;893:18
effective (4)
810:17;815:3;
816:11;818:17
effectively (16)
734:11,14;735:20;
803:12;806:1,25;
807:19;808:17;811:1,
9,23;812:18;815:4;
819:24;823:18;833:24
effort (1)
791:2
egregious (1)
742:25
eight (7)
729:14;730:21;
732:20;734:25;735:15;
773:14;878:11
Either (16)
736:6,7;746:15;
771:7;776:6;777:19;
787:21;792:21;809:20;
837:18;875:25;878:22;
880:18;884:21;890:23;
891:25
electronic (3)
741:2,25;742:2
element (2)
746:7;811:19
eliminate (1)
732:16
eliminated (1)
834:6
eloquence (1)
840:2
else (15)
726:1;735:18;
736:25;757:3;758:20;
759:16;762:20;784:9;
788:7;812:3;817:1;
824:7;831:24;844:19;
885:11
else's (1)
774:22
elsewhere (3)
833:18,20,20
Email (6)
845:2;846:18,21;
847:24;849:9,11
emails (3)
846:14,14;847:6
emerges (1)
754:23
employed (2)
740:16;863:24
employee (9)
795:5;800:8;872:18,
Min-U-Script® SOUTHERN DISTRICT REPORTERS (8) differential - employee
19,23;883:21;885:12,
16;893:3
employees (3)
873:13,14;874:14
employer (3)
738:22;882:22;
883:11
employing (1)
739:24
employment (2)
748:20;866:25
enable (1)
789:23
encompassing (1)
806:5
encountered (1)
734:19
end (15)
764:25;793:14;
797:4,10;807:18;
809:19;812:13;815:12,
16;816:14;820:11;
847:6;864:5;865:19;
887:6
ended (1)
810:22
ending (2)
868:17;887:19
endless (1)
840:11
endorse (1)
786:2
engaged (1)
763:21
engagement (1)
735:2
engine (2)
752:9;831:7
enlisted (1)
805:25
enough (8)
728:25;750:2,6,7;
778:14;785:25;819:14;
894:16
ensure (1)
836:21
enter (4)
730:1;837:11,16;
871:19
entered (9)
730:2;742:15;
753:23,24,25;859:23;
860:3;862:25;882:6
entering (2)
814:6;861:22
enters (2)
811:4,6
entire (8)
744:10;754:19;
780:4;787:19;806:9;
820:1,23;821:3
entirety (1)
733:8
entities (6)
803:11;875:23;
876:3,8;878:4;879:19
entitled (3)
784:17;857:4,4
entity (5)
808:12;865:22;
874:21;884:23;885:16
entries (3)
802:12;806:19;
891:15
entry (5)
768:16;888:15;
892:2;893:16;894:7
Equity (18)
798:8;807:2,3,3,9,
19;808:2,15;810:17;
816:22;820:24;826:10;
844:1,5;867:14,25;
868:15,19
erroneously (1)
855:8
error (14)
767:3,20;769:11,17;
781:16;789:4,6;790:4,
7,8;855:7,9,22;856:16
errors (4)
738:14;752:2;
834:10;835:9
essence (1)
782:17
essential (1)
746:7
essentially (6)
745:6;747:10;
750:11;756:1;771:2;
841:3
established (1)
867:25
establishes (1)
754:11
establishment (1)
866:16
estimate (5)
781:14;789:23,25;
790:12;859:13
estimates (1)
790:1
et (2)
738:22;884:11
etc (2)
834:11;835:9
evaluated (1)
776:19
evaluating (1)
728:2
evaluation (2)
790:22;858:23
even (37)
725:9;728:5;731:19;
732:22;733:12,21,25;
734:16;735:1,17;
736:2;741:8,10,20;
742:4,25;743:1,25;
749:5;763:11;764:11;
766:17;780:22;781:14;
782:23;791:2;799:12;
834:13;836:8;838:10,
11;841:11,22,23;
854:18;886:11;887:1
event (1)
812:7
events (2)
811:13;846:1
eventually (1)
883:25
everybody (2)
812:3;816:25
everyone (1)
769:3
evidence (46)
722:15;726:7,20;
729:25;730:1,2;
731:17;732:3;739:18;
741:2;745:25;746:9,
10;747:17;748:7;
753:18;754:11;755:10;
758:3;765:9;779:4;
781:23;783:1;784:6,
10;788:3,24;789:2;
792:19;793:18;798:12;
804:10;813:13,17;
837:23;840:8;842:5,
12;848:11;850:16;
885:17,25;886:5;
888:1,2,12
evidenced (1)
748:2
evident (1)
832:16
evolutionary (1)
853:13
exact (3)
838:9;851:6;889:16
exactly (6)
722:19;729:2;781:2;
790:16;791:20;792:11
examination (7)
725:18;753:15;
769:19;785:9;800:5;
853:3;863:20
examinations (1)
858:23
example (16)
723:1;724:14;
755:21;770:22,23;
774:16;778:25;779:12;
793:8;822:21;826:3;
832:13,14;841:6;
866:20,22
examples (3)
757:12;821:24;
879:16
exceeded (3)
752:8,10;788:13
exceedingly (1)
757:16
exceeds (1)
750:15
exceptions (1)
763:24
excerpt (3)
722:7,7,11
excerpts (1)
722:25
excess (2)
788:17,20
excessive (1)
795:12
exclude (3)
726:6,9,20
excluded (4)
727:4;774:16;781:4,
4
exclusion (1)
731:11
exclusively (2)
871:23;880:18
excuse (3)
776:24;790:19;
881:13
excused (1)
863:13
executed (1)
806:18
executive (3)
800:11;864:2;892:16
exercise (14)
741:25;742:1,2;
753:9;762:2;765:21;
778:7;855:14,16,17,20;
856:12,16;862:6
exercises (2)
740:4;805:4
exhibit (27)
722:15;723:1,2,7,23,
24;724:4;733:1;
772:17;773:13;774:12;
781:22,23;782:25;
783:11;813:13,17;
845:7;846:4;847:8,23;
848:11,13,14;856:20;
887:15;888:12
exhibited (1)
785:13
exhibits (5)
722:18,25;723:24;
771:8;796:16
existed (6)
748:18;749:1;
776:17,24;820:18;
882:3
existence (1)
754:15
existing (5)
724:25;747:12;
771:13;832:21;833:23
exists (3)
736:15;753:12;
881:23
expanding (2)
871:24;872:11
expect (3)
743:25;785:14;
832:12
expectancy (3)
796:14;842:23;843:6
expectations (4)
808:8;859:18,20,20
expected (7)
764:16;793:22;
815:12,13,16;840:23,
25
expediently (1)
811:11
expense (2)
849:23;850:19
expenses (2)
847:12;848:6
experience (17)
727:13;728:8,14,16;
729:7;762:8;764:4;
801:24;804:11,17;
805:18;864:21,22;
867:20;868:18;878:8,
13
experienced (1)
860:12
expert (39)
726:9,22,25;727:9,
19,23,23,24,25;728:15;
736:9;743:25;744:1;
746:23,25;753:6,25;
757:21;766:7;768:1,8,
14,15,25,25;774:16;
775:13;777:3;778:23;
784:22,22,24,25;785:3;
789:10,11,21;790:20;
831:5
expertise (3)
728:10;747:6;831:9
experts (8)
728:5;729:17;
734:20;765:7;768:10;
769:5;776:4;895:13
expert's (2)
753:3;783:14
expire (1)
875:14
expiring (1)
875:14
explain (3)
776:11;859:15;873:8
explained (3)
754:5,6;759:25
explaining (1)
792:17
explanation (2)
736:21;755:4
explicitly (1)
831:1
exposed (3)
Min-U-Script® SOUTHERN DISTRICT REPORTERS (9) employees - exposed
868:2,6,8
expound (1)
771:25
expressed (1)
812:14
expressing (1)
841:11
expressions (1)
766:5
extend (1)
871:1
extended (4)
871:10;873:1,5;
874:1
extending (2)
870:13;873:4
extensive (6)
819:20;820:8;
821:15;842:15;843:1;
866:12
extensively (1)
745:17
extent (12)
738:3;746:11;
748:10;754:17;776:12;
788:10;803:22;804:9;
811:2;812:3;844:10,13
external (1)
818:9
externally-issued (1)
810:4
extraordinarily (1)
744:5
extrapolatable (1)
778:14
extrapolate (6)
761:14;763:17;
779:14;783:15;784:15;
787:19
extrapolated (1)
780:3
extrapolating (3)
782:18,21;843:4
extrapolation (3)
776:3,10;779:21
extreme (1)
886:10
exude (1)
743:24
F
face (11)
728:6;736:18;737:4;
739:12;748:2;750:24;
757:11;815:5;884:14;
887:17;894:12
facetious (1)
893:6
facial (2)
741:17;758:21
facially (3)
729:18;736:24;
758:23
facilitate (1)
877:11
facility (1)
877:10
fact (34)
728:7;729:12;
732:13,24;735:16;
737:6;739:4,6,18;
740:2,22;741:24;
753:1;754:20;756:22;
763:2;775:5;778:16;
796:23;804:3,7;
817:19;837:6,15;
838:21;839:3,3,23;
846:6;848:2;859:16;
860:16;862:1;889:17
factor (1)
762:16
factors (5)
745:20;759:9;
812:22;815:10;823:16
facts (3)
727:1;735:12;747:10
failed (2)
736:24;748:10
failing (1)
835:9
failure (5)
737:14;783:25;
784:4,16;788:25
fair (15)
789:20;807:17;
814:13;815:6,7,8;
816:6;825:24;854:16,
17;856:5;859:9;
864:14;887:21;892:21
fairly (5)
778:8;787:17,18;
819:20;871:7
Fall (1)
871:24
falls (1)
868:5
false (2)
787:5;837:20
familiar (9)
828:6,14,16,20;
858:13;869:8;870:2;
887:9;889:5
familiarity (6)
826:20,21;828:13;
831:9;856:6;859:15
family (2)
865:19;879:9
Fannie (5)
743:2;803:8;804:4;
867:7;882:15
far (14)
741:23;742:23;
764:10;767:2;788:2,
13;799:13;816:5;
820:15;826:1;831:25;
834:17;843:14;869:3
farther (1)
839:10
fashioning (1)
871:5
fault (5)
738:24;833:2,2;
837:14,19
fax (1)
889:1
February (2)
891:13;892:21
fed (1)
774:6
Federal (4)
726:7,19;765:8;
802:17
fees (2)
860:20,22
fell (2)
731:2;869:3
fellow (1)
844:18
felt (3)
775:15;822:4;865:20
female (1)
892:18
few (7)
722:4;778:10;786:8;
787:9;793:3;802:14;
814:1
FICO (8)
754:8;869:15,18;
870:12,22,25;871:2;
882:5
FICOs (2)
870:13;882:13
field (7)
726:22;777:4;
779:15;784:25;832:19;
851:14;874:14
fields (3)
789:11;823:13;
842:15
figure (5)
785:22;840:23;
849:25;850:21;859:2
figures (1)
894:5
figuring (1)
838:9
file (67)
733:6,7,14,17,18,19,
21;734:4;735:9,18;
736:13,18;741:3,16;
742:10;748:1,1,9,12,
15,15;750:7;753:1,21,
22,23;755:22;757:11;
758:9,16,21;759:1,2,
19;760:20;762:7,9;
766:14;767:9;768:1,
25;769:1,22;770:11,
20;771:18;772:3,4,5,5,
19;773:4;776:14,18,18,
19,22;778:11;836:21;
842:21;855:21;856:17;
881:16;883:2;890:4,5,
9
file-level (2)
838:23;841:19
files (55)
723:10;731:20,24;
732:14,23,25;733:5,15;
735:13;736:23;741:15;
742:3,12;747:25;
752:14,18;758:16;
759:22,25;760:5,7,13,
13,25;761:4,16,17;
763:3,7,9,11;764:15;
765:25;767:25;769:15,
15,17;772:7;776:8;
784:9;785:7;788:25;
842:14,14;853:20,24;
854:3,6,9,15,19,22;
855:3;856:13;887:9
filing (1)
813:8
filings (1)
740:20
fill (2)
829:3;840:12
filled (1)
773:24
filling (1)
851:18
final (4)
769:2;850:22;
851:21,23
finally (3)
765:11;820:10;
893:14
finance (1)
800:20
financial (23)
748:6,20,24;749:8;
768:23;801:21;802:10;
806:20;841:8;862:6;
883:11,16,22;884:6,10,
19,22;885:12;886:17,
18,21;890:15;894:5
financially (1)
874:19
financials (3)
874:9,10,18
find (8)
724:8;771:19;
777:20;832:18;833:8,
16;851:24;891:19
finding (10)
742:19;755:11;
760:14;769:12;772:25;
773:17;774:5,6;775:3,
5
findings (18)
723:16;724:14;
731:14;744:24;747:9;
755:19;756:20,23;
760:5;762:17;763:16;
764:13;769:7;771:12,
12;772:16,22;773:9
finish (2)
799:12;895:12
fire (1)
727:25
firm (6)
722:16;725:3,4;
765:1;769:14;842:20
firms (2)
734:4;836:16
first (65)
722:25;723:13;
727:4;732:1,23;733:9,
10;737:14;739:1,2;
743:24;746:8;747:18;
753:19;755:17;756:8;
759:8,24;760:24;
764:4;770:10;777:16;
780:4,25;785:11,12;
789:16;791:6;798:5;
801:6;802:3;803:21,
24;806:2;808:12;
810:3;818:20;819:10,
25;820:1,13;821:3;
832:17;836:6;843:9;
846:14,18;847:2,4,24;
849:14,16,17;850:4,5,
6;853:17;856:2;
857:24;861:2;862:16;
867:7;868:14;884:3;
891:15
first-line (1)
768:15
firsts (2)
849:15;850:7
fit (2)
865:20;866:7
fits (1)
787:14
five (8)
733:16,16,18;
741:15;750:7;756:20;
844:18;884:11
five-minute (2)
852:5,6
flag (5)
743:23;746:2;
750:12;752:11;771:17
flagged (3)
768:17;771:20,20
flags (1)
742:17
Flagstar (151)
722:8,10;723:8;
724:9,17;725:7,18;
726:19;730:13;731:1;
739:16,18,23;746:3;
749:2;752:3;754:25;
763:22;764:3;767:5,
10;775:19;784:5;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (10) expound - Flagstar
798:8;800:8,10,11,12,
14;801:4,8;802:11,16,
17;803:20,21;804:3,
17;805:6,19,24;806:7,
8;807:3,9,16;808:5,12;
809:25;810:9,14,15,19;
811:8,22,24;812:3,5,
14;814:18,24;815:4,
22;816:15,17;817:5,10,
14,17;818:14;821:6;
826:13,14,16,17,18,20;
827:6,7,8,23;834:20;
837:7;840:8;841:4;
842:13;843:19,24;
849:23;850:20;853:8,
17,24;855:17;857:12;
860:16;861:1,23;
862:1;863:1,5,25;
864:3,7;865:4,15,20,
25;866:7,9,9,20;867:5,
10;868:22,25;869:3,9;
870:25;871:13,21;
872:1,20,25;873:4,7,9,
15,17,19;874:1,7,16;
875:2,7,9,15,18;876:4,
12,16;882:6;883:13,18,
19,20;884:1;887:10;
888:13;893:3;894:2
Flagstarcom (1)
893:9
Flagstar's (37)
729:24;730:8;745:9,
11,12;750:15;758:2;
803:2,3;805:18;
806:20;807:21;808:1,
15;813:6;816:22;
817:6,14,23;820:13;
824:4;835:13;836:17;
837:4;843:9;857:7,16;
860:15;861:14,18;
868:20;869:13;870:21;
876:15;880:10;889:23;
890:21
flawed (1)
779:24
floor (2)
870:25;876:20
floors (3)
869:15;870:12,22
flow (3)
806:25;815:11;
849:16
flows (6)
809:15,16,20;811:7;
812:12,13
fluctuations (2)
868:1,3
fly (1)
764:5
focus (1)
843:6
focused (6)
728:18;744:21;
750:1;754:14;880:11,
18
focusing (5)
784:13;786:6;864:9;
866:10;876:25
foibles (1)
764:9
folder (1)
772:23
folders (3)
770:15,16;773:10
folks (3)
741:11;774:2;822:18
follow (2)
779:10;822:6
followed (2)
834:10;837:18
following (3)
785:11;798:7;893:9
follows (2)
800:4;863:19
follow-up (1)
851:2
foot (1)
728:21
forbearant (1)
893:21
force (1)
839:1
forces (1)
811:9
forecast (1)
812:22
foremost (1)
727:4
forfeit (1)
816:15
forget (1)
828:6
Forgive (2)
732:11;833:1
form (11)
726:23;805:2;
825:21;829:3;832:12;
833:10;834:15;838:17;
845:1;862:18,21
format (1)
832:6
formats (1)
827:18
former (1)
795:5
forms (3)
845:3;878:25;879:8
formula (4)
779:5,7,7;787:12
forth (9)
723:17;728:16;
780:25;803:8;820:10;
822:13;844:23;846:8;
877:22
forward (3)
746:21;809:6;843:17
found (11)
733:13;749:7;
750:17,19;769:13,15;
772:21;832:21;839:4;
855:10,13
foundation (1)
819:3
foundational (1)
866:2
four (20)
733:8;744:23;745:2;
752:19;755:15,20;
756:3,20,23;759:22;
760:4,22,25;761:22;
765:15;775:20;869:21;
870:5;881:7;889:14
four-week (1)
733:13
frame (3)
782:15;849:4;851:15
framework (1)
858:11
frank (1)
727:18
frankly (1)
787:1
fraud (29)
724:23;731:15;
738:15;741:10;742:17;
744:17;748:2,3,8;
749:18;750:22;752:2,
5;757:11;760:6,7;
762:17;767:3,20;
772:21;773:13;789:6;
875:24,25;876:1;
878:21,22;880:14,18
fraudulent (1)
886:12
Freddie (4)
803:8;804:4;867:7;
882:15
freely (1)
762:21
frequency (4)
868:6,9,18;871:8
frequent (2)
851:7,9
front (7)
722:20;799:21;
807:22;844:2;856:21;
864:5;887:21
frustration (2)
781:17;783:2
FSA (11)
842:18;843:7;
844:15,23;847:13,18;
848:7,22;849:24;
850:21;851:5
FSA's (3)
836:18;847:16;
851:11
full (3)
779:15;788:14;
797:20
fully (2)
779:10;866:22
function (2)
840:21;867:12
Functionally (2)
864:3;872:23
fund (2)
814:7,10
fundamental (1)
882:16
funded (5)
811:7,8;814:18;
815:22;817:14
funding (1)
811:22
fundings (1)
816:18
funds (2)
872:20,22
further (8)
733:5;776:16;
777:10;794:2;798:13;
827:12;863:9;875:15
future (2)
848:3;858:23
G
gain (3)
861:4,7,9
game (5)
764:21;768:5;808:5,
9;843:24
gap (2)
760:17;762:3
gaps (2)
825:25;851:18
garbage (3)
841:3,10;851:22
garbled (1)
764:25
Garrick (3)
722:7;723:8;724:2
gather (1)
880:8
gathered (2)
747:10;750:19
gave (8)
732:9,23;753:20;
772:4;820:23;823:8;
828:10;838:8
Gaylor (2)
781:21;782:23
GE (2)
865:6,16
general (6)
731:3;735:25;790:1;
869:11;881:2;892:5
generally (7)
724:10;725:7;
746:20;828:21;870:2;
871:1;879:7
generate (2)
743:9;773:9
generated (2)
762:15;858:21
generating (1)
802:12
generic (2)
830:15;891:10
gentleman (2)
886:3,5
Geoff (2)
885:12,21
geographic (1)
843:2
geographies (1)
877:19
George (2)
848:24,25
Ginny (1)
803:8
gist (1)
726:10
given (16)
726:12;737:22;
745:14;748:19;759:1;
766:3;770:7,8,11;
793:7;805:18;821:14;
833:10;859:15;892:21;
895:3
giving (2)
799:18;893:18
glad (2)
775:14;893:4
global (1)
797:6
goal (3)
820:1;851:20,20
go-between (3)
806:7,8;818:14
goes (20)
725:11;738:24;
744:10;746:1;752:23;
754:5;761:25;764:23;
769:20;775:8,12;
778:17,20,20;781:2;
790:2,2;798:15;839:8;
886:8
gofers (1)
745:6
good (23)
723:1;737:25;743:5;
749:18;756:23;757:15;
765:3;774:15,24;
797:14;799:23;800:7;
820:25;835:1,1;844:8;
850:25;853:5;863:22;
865:20;866:7;871:19;
888:11
gotcha (1)
768:5
government (4)
803:9,10,13;875:23
grade (1)
Min-U-Script® SOUTHERN DISTRICT REPORTERS (11) Flagstarcom - grade
836:17
grading (1)
836:18
gradually (1)
873:1
grammar (1)
847:7
granting (1)
793:13
grasp (1)
791:25
grave (1)
893:5
great (2)
777:3,5
greater (3)
871:2;877:16;881:5
greatly (1)
752:8
grid (1)
740:5
grievous (1)
788:24
Griggs (1)
895:14
Groton (1)
748:20
Ground (4)
807:6;825:17;845:8;
855:25
grounds (3)
824:23;868:10;888:4
group (23)
731:12;732:20;
748:20,24;749:8;
756:7,8,19;801:16;
809:6;841:8;877:17;
883:11,16,22;884:6,10,
19,23;885:12;886:18,
22;890:15
grouping (1)
727:7
growing (1)
817:11
GSE (2)
803:15,16
GSEs (1)
803:14
guarantee (1)
803:9
Guaranty (1)
861:24
guess (9)
738:4;771:16;
774:25;785:24;831:5;
834:19;863:2;867:16;
871:17
guidance (3)
730:20;773:15,25
guide (1)
754:12
guideline (9)
752:1;758:5;759:15;
760:15;762:20;766:11;
767:1,2;842:17
guidelines (83)
722:17;724:23;
729:10,24;730:7,7,8,8,
9,13,16,23;731:1,2;
736:11;738:12,17;
739:17,23;740:7,25;
744:18;745:10,11,12,
14,16,17,20,22;746:5,
8,9,10,10;748:10;
750:15;754:15;756:15;
758:2,4,24;760:9;
761:2;762:24,25;
763:2,16;766:12,22,25;
767:22;769:4;784:5,6,
7;789:1,3;803:8;
828:15,16;834:10;
835:8;836:17;837:13,
18;838:3,4,19;839:21;
840:9;869:4,8,13,22;
870:3,4,22;871:4,5;
882:16,17;885:7
Gupta (1)
797:22
H
half (1)
725:22
hand (3)
722:22;748:15;
814:15
handed (5)
758:16;770:16;
848:13;856:20;883:5
handled (1)
873:15
hands (2)
806:3;843:7
handwritten (2)
889:9;894:5
handy (1)
766:2
Hang (1)
789:19
happen (6)
769:12;773:9;
785:21;793:21;831:10;
885:6
happened (4)
764:1;773:14;
783:18;885:6
happening (2)
782:18,21
happens (3)
763:24;811:22;
831:21
happy (4)
725:23;745:21;
748:4;795:11
hardship (4)
889:2,9;893:14,23
harsh (1)
749:20
head (14)
731:11;734:12;
800:12,15;801:1,17;
818:21,24;819:2;
841:11;843:12;864:14,
19;865:18
headquarters (3)
874:4;876:19;877:10
heads (1)
734:20
hear (31)
724:11,16;726:4;
730:25;731:1;735:14;
739:15;741:18;742:22;
743:13;757:19;758:7,
13;759:16;761:2;
762:19;765:11;769:21;
771:23;773:14;775:17;
784:20;789:10,12;
795:19;797:6;822:7;
824:17;836:12;839:6;
844:12
heard (20)
724:7;727:19;731:3;
732:3;733:10;734:21;
746:15;747:9,21;
752:19;757:22;758:8;
759:16;760:20;764:14;
784:10;795:19;799:20;
819:5;843:14
hearing (6)
727:16;732:3;
771:25;797:2;819:7;
836:7
hearsay (16)
746:25;747:1,5,7;
761:9;765:6;774:10;
824:23;845:9,11,14;
846:10,24;847:25;
848:1;888:3
heavily (2)
748:16;809:3
heck (2)
767:21;768:23
hedging (1)
801:12
heightened (1)
877:23
held (3)
858:18;865:16;
889:17
HELOC (18)
723:14;746:6,6;
802:1;809:9;814:3,13;
820:1;827:23;828:6;
833:3;849:14;850:6;
867:8,14;870:23;
879:6;891:10
HELOCs (24)
723:19,20;725:5;
811:7;821:4;867:10,
12,13,20;868:21;
869:9;871:1,10,21;
872:1,25;876:6,12,15;
877:2,25;878:9,15;
879:1
help (7)
743:18;805:25;
806:1;836:10,22;
865:23;880:13
helpful (3)
742:22;776:13;
849:13
helping (1)
769:5
Here's (5)
752:1;753:9;754:4;
766:24;785:20
herself (2)
735:18;765:4
hesitated (1)
825:7
hey (1)
768:21
high (11)
746:5;750:13;754:6,
8;787:3;867:25;868:2,
7,14;870:13;871:1
higher (5)
762:15;828:2;
868:18;882:5,13
highly (2)
753:4,5
himself (1)
748:4
hired (4)
727:22;731:12;
743:18;840:7
hires (1)
727:22
hiring (1)
866:13
historic (1)
762:3
historical (1)
752:10
historically (4)
743:4;826:19;827:9;
864:21
history (5)
794:5;822:1;876:9;
882:18;891:5
hit (1)
784:15
hoc (1)
802:5
Hold (4)
789:17;806:3;
862:14;888:22
holders (4)
809:16,17;811:9;
817:13
Home (7)
798:8;820:24;
826:10;867:14;869:19;
886:20;889:12
Honor (172)
722:18,24;723:25;
724:17;725:14,23;
726:2,5,10,17,21;
727:8,9,10;728:4;
729:3;730:3;731:25;
732:12,18;733:13,25;
734:8,11,24,24;735:7;
736:16,16,22;737:5,9,
13;738:6,23,24;740:5;
741:1,17;742:1,25;
743:11,15;746:13;
747:4,9;748:17;
749:15,21;750:23;
753:8,13;754:1;
756:23;757:15,20,24;
758:2,15,17;759:3,3,9;
760:4;761:14,24,25;
763:7;764:8,12,20;
765:10,13;766:4;
769:14,24;770:14,23;
771:9,25;772:8,24;
774:3,4,15,18;775:8,
18,22,25;777:12,24;
778:6,22;780:2,22;
781:1,11,22,24;782:14;
783:18,22;784:1,2,7,
13,21;785:8;787:1;
789:14;791:22;794:9,
19;796:1;797:8;798:3;
799:24;800:1;803:19;
804:1,13;805:21;
807:7;812:24;813:15;
820:4;821:8,12;
824:16,24;825:12,16;
830:18;835:11,18,22;
836:10;837:22;838:14;
839:7;841:13;842:7;
843:16;844:12;845:5,
7,16;846:4,5,25;
847:16;852:4;862:20;
863:9,11,15;866:3;
887:5,14;888:3,9,19;
889:15;890:2,8,18;
891:2;894:14,18,21;
895:3
Honor's (1)
757:10
hoping (1)
879:22
hour (2)
725:23;881:7
hours (7)
733:13;749:25;
750:4,6,9;795:4;798:9
house (1)
840:20
housekeeping (2)
795:1;799:8
housing (1)
868:4
Min-U-Script® SOUTHERN DISTRICT REPORTERS (12) grading - housing
huge (2)
744:2;754:20
hundred (4)
761:18;802:23,23;
817:15
hundreds (2)
749:25;804:3
hypothetical (2)
750:9;839:24
I
idea (4)
742:11,14;750:3;
762:13
identified (7)
752:14,22;753:16;
755:5;798:6;820:13;
823:2
identifies (2)
814:12;823:3
identify (7)
736:17,22,24;823:1;
825:25;826:3;851:19
identifying (1)
822:25
IDM (1)
889:2
ignored (1)
741:2
I-know-it-when-I-see-it (1)
761:20
immediate (2)
833:9,9
impact (4)
806:20;812:23;
827:15,16
impeachment (1)
761:25
implication (1)
834:20
implications (1)
806:16
implicit (1)
856:7
implies (1)
817:20
imply (1)
857:23
import (1)
877:7
important (4)
728:2;754:4,10;
788:12
importantly (2)
737:13;841:4
imprimatur (1)
774:2
improper (1)
773:8
improperly (2)
782:16;783:12
in/garbage (2)
841:3,10
inability (4)
764:11,12;774:10,11
inaccuracies (1)
764:13
inaccurate (1)
764:25
inadequate (1)
841:24
inappropriate (1)
773:7
in-between (1)
744:24
Inc (4)
883:11,22;884:6,10
inclined (1)
793:4
include (5)
737:20;742:4;
834:12,12;880:23
included (9)
725:19;770:10;
783:12;786:8;819:25;
848:5;849:24;850:20;
856:13
includes (2)
794:16;857:20
including (5)
724:22;725:1;
769:12;818:25;846:8
inclusion (1)
833:5
income (62)
737:4,6;738:5,9,19,
21;739:4,5,8,13,14,15,
19,20,21;740:3,8,12;
741:1,25;750:13,14,24;
752:4,7;755:2;759:12;
760:17,18;768:17;
773:13;806:21;823:19;
828:19,24,25;829:1,4;
830:3,3,7,7,22;832:16,
19;841:8;855:8;
856:16,17;865:12;
866:25;878:20,20;
881:11,18,20,22,23,25;
882:10,21;887:4
incoming (1)
809:15
inconsistencies (1)
733:2
inconsistent (1)
862:17
incorrect (2)
726:14;738:23
increase (14)
736:12,19;744:21;
745:1;754:16;755:18;
758:7;766:8;767:15;
814:23;815:2,25;
816:9;866:19
increased (2)
767:19;815:9
increases (1)
756:1
incurred (1)
762:22
Indeed (1)
748:2
independent (2)
769:1;842:6
in-depth (2)
839:3,4
Indiana (1)
872:8
indicated (15)
732:5;778:2;793:8;
795:3;849:16;856:5;
870:21,25;874:23;
875:6,15;877:4;
878:14;889:19;890:11
indicates (1)
885:18
indicating (2)
889:10,24
indicia (1)
748:7
indirect (2)
747:2;762:1
indirectly (1)
850:13
individual (6)
753:21;759:19;
776:15,18;875:24;
885:9
individually (1)
776:19
individuals (2)
734:15;881:16
industry (15)
729:10,17,18,22;
730:9,14,16,17,22;
864:23;865:21;868:4;
871:18;882:9;894:3
inference (1)
758:19
inferred (1)
836:25
inflate (1)
880:21
influenced (1)
753:14
inform (1)
771:13
information (32)
740:16;741:14;
742:5;747:16;762:6;
796:11;803:20;823:12,
14,14,17;835:24;
836:20,22,23;837:6;
842:14;843:2,3,3;
850:3;853:8,15,17,21,
25;859:12;880:2,3,8;
885:21;886:23
inherently (1)
738:6
initial (5)
787:4;816:18;
818:13;823:12;861:13
initially (2)
814:4;859:23
inject (2)
775:15;807:9
injection (2)
807:19;810:17
innocent (3)
737:8;764:12;773:6
input (16)
732:20;742:5,12,12;
762:8,10,12,14,14;
770:11,12;771:1,4;
772:12;773:23;774:2
inputs (5)
742:7;762:6;773:8,9;
774:13
inputted (1)
769:16
inquiries (3)
755:3;847:16;851:11
inquiry (1)
780:3
instance (4)
763:25;822:25;
861:3;873:9
instances (2)
857:15;881:20
instead (3)
752:21;762:9;825:10
institution (1)
748:25
instruction (1)
731:19
instructions (1)
734:5
instruments (1)
756:2
insurance (5)
805:3;806:7;811:20;
865:6;879:19
insure (3)
836:4,5;843:11
insurer (5)
805:7;809:19;810:8,
13;824:10
intake (1)
828:11
integrated (1)
866:22
integrating (1)
866:24
integrity (7)
837:1;838:22,23;
841:6;842:20;853:7;
876:9
intended (1)
799:14
intentional (1)
737:11
interaction (1)
801:20
interest (63)
788:22,23;801:12;
806:24;807:2,3,23,25;
808:13,20;809:1,7,11,
22,24;810:4,15,19,20,
21,22,24,25;811:15;
812:1,6,10,11,14,20,20,
23;813:22;814:9,9,14;
815:5,6;816:6,21,22,
23;817:18,23;818:5,8;
819:1;844:1;851:13;
857:9,11;858:3,15,16;
859:3,6,16,25;860:2,
16;861:14,19;863:4
interested (1)
854:22
interesting (3)
730:10;742:1;793:5
interests (5)
806:22,23;808:10;
814:2;815:11
interim (1)
816:23
intermingled (1)
725:5
internal (5)
722:12;741:7;
825:23;826:2;854:13
internally (1)
826:5
Internet (2)
779:5;884:22
interpretation (1)
771:3
interpreted (1)
729:11
interpretive (1)
770:10
interrupt (2)
734:1;742:20
interrupted (1)
861:6
interrupting (2)
732:11;793:24
interruptions (1)
797:21
interval (1)
781:16
interview (1)
731:13
interviewee (1)
749:19
interviewer (4)
748:22;749:12,19;
767:4
interviewer's (2)
883:10,10
interviewing (1)
884:25
into (66)
724:18;730:1,2,16;
732:2;733:14;735:11;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (13) huge - into
738:15;739:18;740:14,
18,19;753:15,23,24,25;
755:9;756:5,6;761:15;
766:21;772:12,16;
775:16;779:13;784:6;
792:18;807:4,10,19;
809:10;811:4,6;
812:19;813:13;834:22;
835:5,16,20;836:2;
837:11,16;843:8,20;
849:11;850:1;851:14;
858:2,15;859:23;
861:2,8,9,22;862:11,
25;864:13;867:10;
868:2,16;871:8,19;
875:19,23;882:6;888:2
introduced (1)
792:18
introducing (1)
878:23
inundated (1)
741:13
inventory (1)
821:3
invest (1)
866:18
invested (3)
807:3;826:23;866:15
investor (1)
869:19
invite (1)
768:7
involved (13)
737:21;760:5;
818:10,22;819:4,9;
826:14,15,17,18;
851:16;855:20;871:10
involvement (1)
819:18
involves (1)
804:25
involving (1)
776:6
irrelevant (5)
804:10;840:20;
841:19;842:4,6
is/does (1)
847:5
issue (25)
723:22,23,24;729:5;
730:15;731:14;736:18,
23;760:22;761:24;
762:3;775:23;790:11;
794:3;802:2;804:8;
806:15;818:11;825:7;
838:24;840:1,3,10;
862:25;863:2
issued (6)
724:22;733:9;
748:25;807:11;809:12,
14
issues (15)
725:8;730:23;
736:20;740:23;741:18;
755:2;757:3;775:19,
20;793:5;801:11;
820:14;839:4;844:10;
868:19
item (3)
729:16;790:2;846:14
items (3)
823:15;835:15;
849:13
iterative (1)
764:17
it-type (1)
735:22
1
1anuary (6)
781:17;782:3;783:2;
786:10;893:15,15
1ean (2)
722:7;723:8
1eff (3)
847:4;849:3;895:13
1effrey (2)
849:2;851:7
job (9)
734:6,10,16,17;
800:23;864:9,11;
885:9;889:23
1ohn (1)
895:13
join (1)
801:4
joined (1)
801:6
1oseph (1)
726:9
1P (35)
802:6;805:25;806:4,
10,12;809:3;818:14;
819:25;820:8,23;
821:3;822:9,16,16,17,
18,20,22;823:8,10;
824:4,10,12,12,19,20,
22;825:2,4,10,15,19;
826:1;853:9,12
1PMorgan (2)
843:19;849:8
1udge (14)
722:20;723:11,19;
724:13;734:21;775:21;
779:9;783:13;784:4,
18;790:17,18;791:4;
834:14
judges' (1)
737:20
judgment (9)
747:6;765:21,24;
772:8;778:7;784:17;
837:23;839:9,25
1une (4)
813:8;814:21;
815:23;857:4
1ursek (33)
798:6;800:1,2,7;
801:4,14,19;802:16;
804:17;808:9;811:16;
812:10;813:3,19,24;
814:15;818:10;820:7;
823:8;825:15;834:6;
835:13;837:3;844:22;
845:12,20;846:11;
847:17;848:13;852:2;
853:5;858:7;862:24
1ursek's (2)
818:24;834:23
K
Kate (1)
893:4
keep (2)
799:11;821:7
kept (2)
844:1;851:18
Kevin (1)
764:22
kind (13)
730:4;741:5;748:2;
756:10,13;758:9;
786:1;787:14;807:9;
822:21;837:4;878:18;
889:25
kinds (4)
755:4;757:3;771:7;
843:1
kite (1)
764:5
knew (5)
774:14;780:12;
798:6;831:12;862:25
knocking (1)
821:1
knowledge (13)
726:22;733:24;
761:10;772:24;818:20;
819:6,15;821:13,15,18;
824:19;825:18;826:21
knowledgeable (2)
728:25;777:4
known (8)
753:22,23,24;754:2;
781:9;834:17;865:21;
885:22
knows (2)
726:21;727:23
Kumho (2)
736:4,7
L
labeled (1)
770:20
Labor (1)
752:9
lack (13)
729:18;736:4;
754:24;761:4;774:9,9;
805:18;806:2;818:20;
819:6,15;821:12;
825:18
lagged (1)
859:20
language (1)
760:7
large (2)
818:12;889:4
largely (1)
865:9
larger (5)
777:14;779:8,15;
780:15,20
last (15)
729:3;742:24;
748:21;749:11;795:1;
814:1;839:8,19;
840:24;847:11;859:9,
17;877:14;883:9;895:3
late (3)
741:14;812:9;894:21
later (9)
759:6;763:4;768:2;
837:18;859:5;872:12;
880:10;889:14;890:5
latter (5)
832:13,14;881:12,
12,13
laundering (2)
740:15;867:1
law (7)
731:9,11;734:13;
758:20;765:1;769:14;
775:9
lawsuit (2)
764:9;767:25
lawyering (1)
764:9
lay (1)
741:6
layers (1)
764:23
leaders (1)
866:13
leading (5)
805:8;807:7;846:23;
866:1;873:22
leads (3)
761:4;764:12,14
learn (2)
768:8;793:22
learned (1)
725:2
least (9)
727:3;732:19;
746:22;787:24;820:9;
837:1;840:5;844:16;
886:3
leave (2)
770:25;792:23
Leaving (1)
768:17
led (2)
759:15;762:20
left (10)
733:16;806:25;
812:13;815:16;892:7,
8,9,15,19;893:12
left-hand (1)
781:24
leisure (1)
795:12
lend (1)
779:20
lenders (2)
869:2;875:22
lending (1)
868:14
lends (1)
753:3
length (4)
745:19;838:8;
874:21,21
lengthy (1)
819:14
less (13)
725:22;733:16;
737:8;750:18;791:7,
14,17;792:8,13;
795:18;797:20;815:8;
861:16
letter (7)
755:4;867:2;889:2,9,
9;893:14,23
level (27)
728:19,20,21,22;
733:23;737:22;739:16;
740:18,20;759:11;
768:16;771:16,17;
781:15;787:13,21,22;
790:8,13;796:23;
828:10;836:15;847:15;
851:11;858:22;865:10;
878:7
levels (4)
737:5;739:20,24;
808:18
leverage (1)
865:23
Lexis-Nexis (5)
740:9,14,19;866:25;
884:21
liability (9)
746:22;761:14;
767:11;776:6;789:8;
801:1,7,10,15
LIBOR (1)
858:17
license (1)
875:14
licensed (1)
875:10
Min-U-Script® SOUTHERN DISTRICT REPORTERS (14) introduced - licensed
licensing (3)
874:10;875:8,13
lied (1)
837:14
lien (2)
849:14;850:6
liens (1)
867:24
life (1)
765:1
light (1)
793:11
likely (9)
740:17;762:3;
764:19;795:23;798:2;
827:25;885:1;893:2;
894:9
limine (4)
775:23;779:4;
793:10;794:15
limitations (3)
749:18;869:20,20
limited (5)
867:25;868:15,19;
869:18;882:14
Linda (1)
866:14
line (20)
766:19;772:9;
777:25;778:11;789:16,
18;790:17,21;791:11;
792:4,6;804:6;819:5;
862:10,12,12;867:7,14;
872:23;891:7
lines (10)
754:12;758:18,20;
759:14,21;778:2;
814:5;837:22;841:20;
893:7
lineup (1)
795:7
Lipshutz (16)
726:9;775:21;777:2,
3;779:3,9;780:7,17;
781:5,7,13;787:22;
789:16;790:19;791:7;
792:17
Lipshutz' (1)
778:23
Lipshutz's (3)
780:23;783:14;
790:17
list (3)
757:24;798:4;831:22
listed (2)
782:17;892:4
listen (1)
785:20
literally (3)
840:22;877:18;
885:12
litigation (1)
818:11
little (16)
726:24,25;729:12;
737:10;744:5;747:2;
766:21;780:19;816:20;
839:19;860:4;861:16;
864:18,19;865:24;
872:13
live (6)
742:9;763:25;
799:14,20;859:18;
895:9
living (2)
768:14,15
loan (214)
723:10,11;728:22;
729:3;731:20;732:23,
25;733:5,15,17,18;
735:4,9,11,11,13,17;
736:13,22;739:19;
747:21;748:24,25;
754:7,8,10,18,18,22;
756:12;758:9,16,16,21;
759:1,2,19,22,25;
760:12,13,20,25;761:7,
8,15,17;762:7,9;763:3,
7,9,11;764:15;766:3,
15;767:7,8,25;768:1;
769:6;770:8,19,21;
772:4,5,7,18;775:3;
776:8,14,17,22;777:7;
781:25;782:1;783:2;
784:9,14,14;785:7;
788:24;792:1;796:12,
13;802:18;803:4;
804:18,24,25;807:21;
809:18;810:7;818:10;
819:2,19;820:7;823:1,
1,8,10,12;824:13,20,
22;825:4;826:4;827:2,
14,23;828:6;829:3;
830:2,16,17,20,21,22,
24;833:3,13,13,15,16,
17;834:4,16;835:3,16,
18,19;836:15,21,21,22,
25;838:2,17;840:19,20,
22;841:1,7,18;842:1,2,
13,15,21,22,23;843:1,
17;844:23;847:16,18;
851:12,13,16;853:8,14,
20,21,24,24;854:3,6,9,
15,22;855:3,8,9,10,13,
21,21;856:13,17;
858:22;865:7,8;
867:15,22;872:17,18,
23;873:8,9,10,17,20;
874:3;881:22,23;
883:2,25;884:18;
885:13,15;887:9,13,14,
16,19;888:18,20;
889:16;890:1,4,5,10,
21;892:16
loan-by-loan (4)
796:19;835:23;
843:2;865:10
loan-level (1)
849:12
loans (143)
723:12,14;724:9,9,
18,21;725:4;739:3,8;
741:9;743:19,20;
744:23;745:1,2;746:6;
754:22;755:9,10,12,13,
15;756:3,7,8,14,19,20,
22;757:6,7,15;758:8;
759:23;760:2,4,18;
762:23;763:17;765:15;
767:17,17;768:12;
769:9,17;777:20;
781:25;782:3,5,7,9,11,
12,16,19,19,20,21,22;
783:3,12,19,19,23;
785:12,15;786:7;
788:17;791:17,19,20,
21;792:3,8,10,11,12;
803:16;804:25;805:1;
806:6;807:10;809:9;
818:15,17;820:2,24;
821:1,7,23,24;822:1,2,
24;823:3;826:9,10,11,
14,15,19,21,23;827:1,
10;828:18,19,24,25,25;
831:23;832:15;833:15;
834:6,6,9,17,21;
836:19;837:19;838:24;
839:2,14,14,23,23;
849:14;850:6;851:19,
24;854:19;860:21,22;
861:2,8,9;863:3;
869:17;870:13;873:6;
875:24;878:6;885:16
loan's (1)
777:8
loan-to-value (2)
823:16;826:5
local (3)
800:25;885:20;886:4
locate (2)
749:8;891:15
located (2)
877:5;878:2
location (1)
832:12
logging (1)
891:9
login (1)
893:2
long (10)
725:21;783:13;
800:13;801:2;810:12;
814:11;820:7,12;
864:7,16
look (53)
723:16;728:14,15;
733:3;742:3;744:10;
747:25;753:1;754:19;
755:25;756:24;757:2,
6,11;758:22,25;759:2,
10;760:6;762:25;
763:1;769:23;770:6,
18;777:16;778:11;
782:1,2;786:3;787:4;
788:21;790:22;791:8,
10;793:9,11;803:25;
833:18,20;838:8;
839:3,4;841:5;845:10;
847:6;855:6;856:20;
857:3;859:2;886:14,
23;888:14;895:2
looked (8)
733:1,5;750:14;
756:14;761:4;763:4;
793:9;887:11
looking (13)
728:19;740:15;
752:15;758:18,19;
768:24;770:8;786:4;
857:10;874:8;876:8;
887:14,15
looks (6)
723:25;781:24;
783:4,5;816:20;891:10
lose (1)
793:18
loss (20)
795:16;796:4,7,14;
812:22;816:3;839:15;
840:20,23,25;842:2,8;
843:5;849:18,20;
850:11,13;858:21,23;
893:21
losses (8)
808:11,13;812:1;
815:3,13;816:4;839:9;
860:11
lot (18)
730:23;737:11;
740:22;757:22;765:3;
767:21,24;768:23;
777:5,5;801:20;
818:19;822:19,20;
826:6;842:1;854:13;
895:15
love (2)
794:6;894:15
low (1)
754:7
lower (4)
790:13;846:21;
869:16,19
lowest (1)
869:16
LTV (1)
868:14
luck (2)
849:18;850:10
lunch (2)
759:1;793:3
Luncheon (1)
798:17
luxury (2)
793:7;795:9
M
ma'am (10)
863:24;864:16;
865:24;867:10;869:10;
871:11;877:1,7;
878:24;880:16
Mac (3)
803:8;867:7;882:16
Mae (5)
743:2;803:8,8;867:7;
882:15
magnitude (1)
771:14
main (3)
725:2;806:7;867:23
maintained (1)
844:5
maintaining (1)
808:1
major (1)
886:21
majority (2)
869:17;877:4
makes (8)
749:5;754:7,8,10;
768:23;785:2;799:8;
809:7
making (14)
758:13;768:7;
779:18;822:8,11;
831:2;832:5;841:9;
843:10;860:17;861:23;
885:23;887:3;892:12
man (1)
892:17
manage (3)
768:12;864:5;887:11
management (14)
727:12;728:8,9,13,
18,20;801:1,12,15;
802:4;858:10;864:12;
866:18;879:17
manager (9)
801:7,10;865:2,17,
18,18;866:13;877:18,
18
managers (4)
877:21,22;878:2,3
mandate (1)
817:12
manner (1)
843:23
manners (1)
744:5
mansion (1)
748:4
many (17)
723:12;728:24;
734:21;744:2;753:9;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (15) licensing - many
764:23;772:3;779:22;
784:9;785:21,23;
786:10;798:2;801:22;
802:22;804:3;865:17
March (6)
888:15,17,21,22,24;
894:8
margin (7)
756:10;781:16;
790:4,7,8;795:21;
867:18
marginal (1)
848:9
MARI (2)
875:16,18
mark (3)
760:12;797:17;836:7
marked (1)
895:8
market (2)
729:6;869:2
marketplace (1)
882:4
Markets (3)
800:12,15;801:16
markings (2)
725:13,14
Marni (3)
723:8;863:15,17
Mason (17)
726:9;775:21;
780:24;781:2,4,7,19;
782:9,18;783:4;786:3;
788:10;790:19,23;
792:17;794:10,15
Mason's (5)
782:1;790:20;791:1,
3,24
mass (2)
742:7,10
massage (1)
835:5
masters (2)
800:19,22
matched (1)
855:22
material (23)
735:3;736:12,18;
737:4;738:14;745:1;
758:1,7,10,23;759:25;
760:8;766:18;767:19;
768:20;775:5;776:17,
23;778:5;779:1,13,17;
780:14
materiality (12)
736:14;737:3;738:2;
741:16;752:25;753:13;
756:16,17;765:5;
767:13;774:12;844:15
materially (11)
735:4,8,11;744:21;
746:4;755:18;756:1;
766:8;767:15,19;769:6
math (1)
772:11
Matt (1)
834:20
matter (8)
730:9;731:21;767:6;
787:1;793:24;795:1;
799:8;889:21
matters (3)
793:23;795:9;797:23
max (1)
844:19
may (53)
726:23;743:22,23;
746:18,20;748:14,14;
753:1;764:8;766:5;
769:24;775:11;776:3;
777:22;779:8,8;
780:15,16;787:8,16,16,
21,24;791:22;796:4,8;
797:20;799:7;803:19;
804:1;812:24;818:19;
819:12,12;821:16,18;
823:6;830:18,19;
835:11;836:9;840:5;
841:13;842:7;845:5;
854:8,8;862:19;
863:12;886:9;887:5,
24;888:13
Maybe (9)
749:20;764:9;
769:22;771:6;774:25;
785:23;799:12;835:2;
895:2
mean (26)
735:9;755:16;
789:25;790:7;792:13;
806:17;807:3;808:9;
810:11;816:13;832:3;
833:20,21;837:16;
851:9;868:3,8;872:15;
877:16;879:13;881:3;
883:13;891:5,16;
892:5;895:9
meaning (7)
733:9;777:18,18;
832:20;881:5;891:19;
893:21
meaningful (4)
733:19,21;734:4;
735:14
meaningfully (1)
732:14
means (7)
735:3;792:4;793:15;
810:12;873:8;891:18;
893:12
meant (5)
735:19;736:21;
834:13,14;893:6
measure (4)
746:23;780:10,12;
781:18
measured (2)
777:11;781:9
mechanism (1)
810:25
meet (6)
736:2,3;748:10;
756:15;760:12;868:23
meetings (1)
877:21
meets (2)
735:23;736:8
member (1)
869:25
memoranda (1)
724:2
memorandum (2)
723:7;739:7
mention (2)
767:1;884:3
mentioned (6)
787:9;806:15;817:3;
820:19;877:13;880:23
mentioning (1)
884:5
merely (1)
786:8
message (6)
764:24;892:7,8,15,
19;893:12
messy (1)
741:6
met (6)
747:16;784:8,8;
788:4;807:15;828:5
method (3)
735:23;745:9;776:3
methodology (19)
724:8;731:6;737:16,
17,25;738:1,1;749:22;
750:11;753:6;757:8;
768:21;769:2,3;
775:10;778:18;779:24;
780:17;783:10
methods (6)
726:25;727:1;
739:25;744:11;745:8,9
Michigan (12)
748:3;800:19,20,23;
802:21,22,25;865:20;
872:8,8;877:5;889:22
microphone (1)
803:24
microscope (1)
737:22
mid-'90s (1)
882:17
midnight (1)
795:12
might (14)
738:4,9;746:2;762:4;
764:9;768:3;807:2;
831:10,17;832:12;
836:10;841:11,21;
860:8
miles (1)
886:4
million (24)
757:13;761:18;
766:16;784:15;788:22,
22;814:20;815:5,7,14,
14,20,24,24;816:2,9,
20;859:4;860:4,5,8;
861:11,11,17
millions (1)
804:3
mind (2)
746:2;870:13
minds (1)
797:1
mine (1)
801:21
minimal (1)
771:17
minimize (2)
743:18,20
minimum (2)
857:20;878:10
minor (1)
780:6
minus (4)
781:10,16;789:24;
790:9
minute (6)
802:15;841:10;
850:5;862:14;883:6;
888:22
minutes (10)
733:16,17,18;
741:15;750:7;778:10;
793:3;802:15;844:18;
856:8
miscalculation (1)
772:14
misrepresentation (2)
760:8;775:5
misrepresentations (2)
766:21;775:6
missing (6)
742:17;763:20,23;
767:23;768:13;826:8
misstate (1)
750:23
misstatement (3)
737:9,14;752:4
misstates (1)
737:3
misstating (3)
737:6,10,11
mistake (2)
756:21;775:11
mistakes (5)
762:7,17,18;773:5,7
misunderstanding (1)
740:24
mitigation (1)
893:21
model (19)
743:3,10;784:25;
796:11;808:25;809:3,
5;835:20;840:20;
842:23;857:25;858:3,
8,9,16,21,22;859:15;
882:16
modeling (6)
795:17;796:5,7;
835:21;842:3,8
models (1)
880:4
modern (1)
765:1
modest (1)
886:11
moment (7)
745:4;769:23;
838:12;844:16;880:11;
883:9;887:22
money (6)
740:14;742:15;
750:1;768:24;857:17;
860:17
Monoline (6)
805:7;806:7;809:19;
810:13;811:20;824:10
month (5)
757:14;831:3;
882:20;886:6;891:9
monthly (1)
841:8
months (6)
800:16;820:10;
859:5,9,17;870:5
more (41)
723:19;728:5;
729:13;735:25;737:7,
12;741:18;742:21,25;
744:19;748:9;757:22;
761:19;768:19,24;
769:21;772:24;776:9;
783:25;789:5;793:11;
797:20;801:21;802:14;
804:4;807:10;827:5,
25;836:9;840:5;841:4,
10;844:18,18;855:6;
859:6;862:5;864:19;
868:6;877:23;882:14
Morgan (35)
802:6;805:25;806:4,
10,12;809:3;818:14;
819:25;820:9,23;
821:3;822:9,16,16,17,
18,20,22;823:8,10;
824:5,10,12,12,19,20,
22;825:2,4,10,15,19;
826:1;853:9,12
morning (2)
797:24;847:5
mortgage (22)
724:9;737:3;749:2;
776:8;803:3,4;826:9,
Min-U-Script® SOUTHERN DISTRICT REPORTERS (16) March - mortgage
10,11;827:2;830:2;
837:14;855:21;864:2;
865:6;867:12;875:21;
879:19;889:2,11,18;
894:10
mortgages (8)
729:7;738:19;746:7;
779:12;803:7,9;804:6;
834:22
Most (9)
752:14;754:9,24;
756:5;808:3;813:9;
867:23;886:11;894:3
motion (7)
726:6,19;734:13;
775:23;779:4;793:16;
794:16
motions (4)
722:3;726:8;793:10,
14
mouth (2)
757:23;843:12
move (7)
768:11;780:7;787:2;
803:24;813:13;843:13,
17
moved (2)
738:10,14
moves (1)
788:11
moving (2)
730:15;780:22
much (22)
742:15;747:2;748:9;
762:15;765:11;772:7;
795:19;802:20;806:9;
812:15;814:18;815:18,
22;816:17;823:5;
843:6;847:22;863:12;
868:6;869:15;877:17;
894:15
multiple (4)
752:15,16;755:3;
851:8
multiunit (1)
879:10
must (7)
727:6;734:18;
776:19;814:9;839:18;
884:24;892:16
myself (7)
790:15;822:15,20;
851:8;864:13;867:9;
873:7
N
nail (1)
730:15
name (4)
748:22;823:14;
883:10;884:4
namely (1)
837:12
narrative (1)
771:11
National (3)
800:23,24;865:18
nationally (1)
802:17
nature (11)
731:18;741:9;751:2;
776:15,25;779:20;
789:3,7;797:7;836:1;
851:5
near (1)
847:3
necessarily (3)
736:12;751:1;773:6
necessary (3)
788:13,20;873:23
need (24)
744:6;750:22;
753:21;758:25;767:18;
775:15;778:20;779:15,
16;782:24;785:21;
787:12;795:10;797:17;
798:4;803:24;819:14;
833:9;839:11,13;
844:19;880:2;881:17;
889:21
needed (3)
778:13;806:2;820:16
needs (3)
756:11;797:9;799:20
negative (8)
809:20,21;811:2,3;
874:10;875:16,25;
876:3
neglected (1)
790:18
negligence (5)
752:2,6;767:3,21;
789:6
neither (3)
787:24;793:13;
839:24
net (7)
806:25;809:20,20;
812:12,15;815:10;
874:20
neutral (3)
727:9,14;743:17
neutrality (1)
727:21
nevertheless (1)
732:3
new (6)
727:25;811:7;819:5;
834:12,12;846:7
news (4)
874:11;875:16,25;
876:3
next (15)
751:3;771:1;786:11;
788:9;798:18;799:25;
821:2;829:6;852:8;
863:14;877:19;886:24;
892:2,24;894:8
nice (4)
758:20;759:14,21;
773:11
Nielsen (1)
895:13
nine (2)
878:11;888:17
non-agency (5)
804:8,17,24,25;
820:14
noncom- (1)
758:1
noncompliance (4)
730:13,13;731:5;
839:21
non-consensus (1)
729:21
none (3)
752:3;775:12;835:7
nonetheless (1)
730:18
nonexpert (1)
753:7
non-historic (1)
741:24
non-intentional (1)
737:12
noniterative (1)
763:22
nonmaterial (1)
760:18
nonstated (5)
830:3,6,16,21,22
nonsubstantive (1)
847:3
nor (2)
787:24;839:24
normal (10)
763:23;764:17;
819:13;828:5;831:3,7;
832:8,11;890:6;894:1
North (1)
801:1
notation (1)
888:21
note (5)
809:16,17;811:9;
817:13;889:6
noted (2)
725:17;747:5
notes (5)
807:11;809:12,14;
888:20;889:6
notice (1)
883:8
noticed (1)
768:25
notified (1)
722:11
notion (2)
753:4;792:3
November (1)
733:8
nuanced (1)
744:19
number (40)
723:19,20;728:14;
744:2;747:12;752:20;
762:15;768:23;769:16;
771:3,5;778:25;782:2;
783:19,19;786:7,7;
787:3,3,18;788:20;
792:15;796:15;818:25;
834:3;845:3;848:14;
851:6;884:23;889:1,4,
4,12,12;891:20,22,24;
892:15;893:12,12
numbers (8)
779:6;788:19;790:2;
841:4;855:22;862:10;
892:3,4
numerous (1)
886:19
O
Obama (2)
785:22,23
object (8)
819:4;842:5;845:7;
846:5,10;847:1;
868:10;888:3
objecting (2)
723:2;870:17
objection (38)
724:6;741:4;795:18;
796:9;799:19,22;
803:17;804:19;805:8,
20;807:5;813:15;
819:14,15;820:4;
821:8,12;822:7;
824:14,15;825:8,12,16,
21;845:11;854:24;
855:11,24;856:8;
862:13,16,21;863:7;
866:1;869:5;870:18;
872:3;873:22
objectionable (1)
824:23
objections (9)
795:10,21;797:5,6,7,
16;818:19;819:11;
862:17
objective (5)
727:12,13;753:10;
761:2;778:17
objectively (1)
753:12
objects (1)
722:10
obligated (3)
814:4,7;839:13
observations (2)
791:21;792:12
obtain (1)
837:14
obtained (4)
835:1,3,4,8
obvious (1)
755:14
obviously (1)
788:15
occasional (1)
766:5
occupancy (2)
869:19;882:14
occur (2)
764:19;874:12
occurred (3)
733:22;839:2;874:2
occurrence (1)
753:17
occurring (1)
764:19
occurs (1)
764:17
o'clock (6)
793:21;797:19;
798:16;894:17,23;
895:1
October (6)
733:8;785:5;791:10;
846:19;893:8;895:16
off (16)
731:3,12;734:22;
762:6;782:3,17;783:3,
20;796:12,12;810:9;
816:8;882:17,17;
889:11;894:10
offer (4)
784:5;843:14;846:4;
862:19
offered (3)
840:12;846:19;847:8
offering (4)
722:15;724:13;
739:6,12
office (1)
889:21
officer (9)
829:3;872:17,19,23;
873:10;886:7,17;
889:3,18
officers (2)
885:15;890:23
offices (4)
802:21,22;886:4,19
off-the-cuff (1)
846:8
often (4)
742:4;774:4,5;851:4
omission (5)
766:14,18;767:3,20;
789:6
omissions (3)
752:2;834:11;835:9
Min-U-Script® SOUTHERN DISTRICT REPORTERS (17) mortgages - omissions
once (5)
769:12;793:4;802:9;
811:1;871:8
One (127)
723:18;727:25;
729:13;730:14;733:21;
735:8;736:1,19;
738:20;740:25;741:1;
742:12,17,24;743:25;
744:15,25;745:3,4;
747:25;748:1,16;
749:15;752:15;754:4,
5;755:21;756:4,8,9;
757:4,6,7,7;758:1;
760:14,21;761:7;
763:20;766:2,11;
767:2,9;768:5;769:2,8,
15,17,17;770:13,16,17,
18,22,23;771:4,10;
772:10,25;774:23;
779:19;780:2;783:9;
784:12,14,14;785:12;
788:2,9,12;792:18;
794:6,9;795:1,3;
797:20;799:7;800:23;
804:12;811:17;815:10;
833:13;834:14;835:12;
836:9,12;838:1,17;
840:12,21;841:17,22;
843:25;844:11,17;
846:15,22,24;847:7,25,
25;848:22;849:4;
855:6;856:9,22;857:4,
4;862:10;875:6;
876:19,19;877:13;
878:25;879:9,9,9;
880:13;882:20,21;
883:4;884:23;888:7;
891:4,15;892:9;895:3
ones (5)
754:13;755:17;
756:9;768:24;784:12
one's (2)
837:14,19
online (2)
890:14;893:8
Only (43)
727:6,20;730:18;
732:3,25;733:6;
737:22;739:4,16,22;
742:20;743:5;746:4,
24;757:20;760:12,24;
762:1,2,8;763:16;
779:23;782:8;795:2;
797:23;800:23;807:15;
812:3;817:5;834:25;
836:16,17;841:2;
845:18;860:12,15;
866:14;869:16;870:2,
13;871:1;872:1;879:7
on-site (1)
874:8
onto (4)
780:4;782:21;
784:15;855:10
open (6)
722:2;748:11;
794:22;795:9;799:4;
849:13
opening (5)
728:7,17;763:8;
764:15;804:2
operate (1)
761:11
operated (1)
856:6
operates (1)
856:4
operating (6)
736:25;738:11;
758:12;765:6;864:24;
875:11
operation (1)
856:3
operational (1)
728:19
operations (4)
728:9;800:25;864:2,
5
operator (1)
764:21
opinion (17)
726:23;727:14;
734:19;735:6;744:17;
753:3,6,7;766:6,8;
774:21,22;783:14;
789:21;791:3;794:17;
839:17
opinions (7)
744:15,16,17,19;
780:23;781:3;794:16
opportunity (5)
769:8;785:7;794:2;
799:18;854:18
opposed (4)
753:7,24;778:25;
780:13
opposing (1)
799:13
opposition (2)
779:4;794:15
ops (1)
866:17
options (2)
893:21,21
oral (1)
797:6
oranges (1)
788:6
orchestrated (1)
806:9
order (15)
722:16;743:15;
752:25;781:8;794:20;
798:3;799:9;809:24;
810:1;880:21;891:1,
13;895:5,9,11
orderly (1)
811:17
ordinary (4)
827:23;845:20,23;
847:20
oriented (1)
838:8
original (5)
783:6;794:16;
833:14;835:7;876:5
originally (5)
748:1;795:8;799:14;
835:1;836:15
originate (4)
826:23;871:21;
873:8;874:3
originated (1)
882:9
originating (10)
804:25;834:21;
867:11;868:22;872:1,
14,25;873:17;874:17;
875:7
origination (10)
803:21;833:3,14;
834:9,16;864:5,10;
872:12,16;876:1
originations (10)
803:4,5,6;849:19;
850:11;866:19;868:21;
873:1,5;874:1
originator (3)
763:4;873:10;883:15
originators (1)
835:3
others (3)
828:14;865:11,11
otherwise (4)
726:23;746:19;
835:2;873:14
ought (1)
846:23
ours (1)
890:22
out (63)
724:8,9;727:10,24;
729:15;736:1;737:16;
739:9;745:2;747:12,
15;749:4,17,23;752:1,
25;756:12,19;757:22;
758:3;760:24;761:15;
763:17;764:12,25;
771:1;772:6;773:7,24;
774:23;779:6;783:5,
17,20,23;784:4,11;
785:22;786:8,9;
793:15;794:14;805:1;
808:6;810:14;820:18;
821:1;829:3;834:6;
837:13;838:9;840:19,
23;841:3,10,21;
842:23;843:11;858:21;
872:11;874:14;877:12;
891:10
outgoing (1)
809:16
output (3)
742:7,13;772:13
outside (3)
833:22;878:4;879:19
outstanding (2)
810:12;867:18
over (35)
726:17;728:24;
741:8,9,10;755:7;
756:6;761:18;762:14;
771:1;785:14;793:22;
795:11;797:25;800:14;
806:25;807:12,13;
809:6;811:1,18;
812:13;816:14,20;
819:12;820:9;821:2;
834:4;837:7;842:9;
847:19;868:4;879:16;
892:24;894:2
overall (5)
791:8;867:17;
868:24;871:7;877:8
over-collateralization (5)
788:18;807:12,13;
808:18;816:18
overly (1)
868:1
overrule (1)
856:8
Overruled (4)
804:21;805:9;820:5;
855:12
overruling (1)
856:7
overstate (1)
771:9
Overstated (1)
755:2
own (28)
727:10;733:22;
736:14;739:20,23;
747:6;754:23;783:14;
784:24;791:2;792:12;
795:20;805:1,2,4,4;
838:7,20;842:18;
844:6;846:8;872:22;
875:4;879:20;881:5;
885:16;890:13,23
owned (1)
800:24
owner (1)
817:5
owners (4)
817:3;874:10,10,24
ownership (5)
808:2;810:20,21;
811:23;817:15
owning (1)
811:24
P
package (1)
771:14
page (36)
748:21;749:11;
751:3;776:20,20,22;
777:1,9,12,21,24;
785:4,9;786:11;
789:16,18;790:17,21;
791:10,10;798:18;
813:19,21;829:6;
849:10,10;852:8;
857:3,10;862:12,12;
883:9;884:3;886:24;
892:24;894:9
pages (8)
776:15;780:7,11;
856:25;862:8;891:3,
18,20
paid (11)
750:1;788:21;810:3,
8;816:4;844:2;849:22,
23;850:18,19;867:16
paper (5)
729:17;731:12;
772:10,25;890:24
paragraph (5)
723:17;724:14;
728:17;847:4;850:22
parameters (4)
836:5;837:10;838:5,
20
pari (2)
812:2;815:1
parroting (1)
731:14
part (37)
723:20;737:17;
744:7;746:22;754:4;
766:14;767:3;788:15;
790:22;804:10;805:12,
15;830:7,11,23;831:11,
17;836:14,18;837:3,7;
839:8;845:23;847:1,3,
8;848:1;856:13;
871:18;874:16;880:15,
19;882:4,8,11,15;883:2
participants (4)
807:1;808:4,11;
810:6
participate (1)
811:25
participates (1)
814:25
participation (1)
808:15
particular (12)
734:5;740:17;742:7;
748:14;749:8;772:2,
18;785:13;803:4;
827:18,18;838:16
Min-U-Script® SOUTHERN DISTRICT REPORTERS (18) once - particular
particularly (5)
723:19;747:6;
761:13;763:19;767:18
parties (3)
817:21;824:11;852:1
partner (1)
726:8
partnership (2)
881:10,19
parts (3)
725:14,16;788:12
party (3)
722:15;725:3;727:22
pass (1)
832:7
passed (2)
748:11;854:13
passing (3)
764:24;840:7;866:23
passion (1)
775:15
passu (2)
812:2;815:1
past (5)
727:23;728:18;
762:12;794:4;823:3
paste (1)
772:16
patently (1)
886:12
Paul (3)
806:13;849:6,7
Pause (5)
722:23;723:5;813:1;
862:15;883:7
pay (11)
738:21;740:3;
783:25;814:4;848:4;
882:1,21;889:3,12;
893:19;894:11
paying (2)
761:17;867:18
payment (3)
892:25;893:6,8
payments (6)
809:11,16,18;811:8;
816:23;817:13
PayScale (2)
769:13;772:11
PayScalecom (7)
752:19;757:4,9;
761:24;762:2;768:21;
769:16
paystubs (1)
894:6
peculiar (1)
867:21
people (17)
731:12;732:15;
744:4;761:9;765:3,7;
768:6,12;769:5;
785:21;810:2;833:11;
840:7,13;848:22;
875:3;891:25
people's (1)
774:13
per (6)
728:3;733:17,18;
741:15;851:10;891:4
percent (27)
737:23,24;739:4;
755:25;756:6,7;
779:22;781:8,10,15,16;
783:8;787:6,13;788:2;
789:24,25;790:8,9;
817:7,16;859:7,17;
860:12;878:3;881:4,5
percentage (8)
724:13;746:5;
782:10;787:20;791:19,
20;792:10,11
percentages (3)
723:18;725:6;788:13
percentile (2)
752:8,11
perfect (1)
886:10
perfectly (1)
795:10
perform (5)
733:19,21;747:14;
805:3;876:4
performance (8)
811:2,3,25;814:25;
844:5;858:22;859:13,
18
performed (11)
734:17;735:9;759:5;
804:3;808:7;836:14;
855:17;874:16,24;
875:2,7
performing (2)
808:14;810:16
perhaps (5)
728:5;732:6;793:17;
833:2;847:4
period (29)
729:5,8,11,19,20;
733:13;763:3;801:9;
811:2,5,6;813:8;814:6;
821:2;834:6;838:9,10;
857:13;866:20;869:9;
871:14;874:12;876:25;
877:2,25;878:7,16;
879:2,6
permission (2)
749:6;862:11
permit (1)
894:18
permitted (3)
746:25;747:5;876:5
permitting (1)
874:3
person (18)
727:12;728:13;
737:3;741:6;748:23;
766:14;767:4;777:4;
828:10;873:10;883:14;
884:10,18;885:3,20,21,
22,23
personal (10)
761:10;818:20;
819:6,15,18;821:12,15,
18;824:19;825:18
personally (5)
731:13;818:22;
819:3,8;858:2
person's (1)
757:2
perspective (3)
817:2;837:4;843:10
pervasive (1)
838:25
philosophy (3)
868:20;869:14;
871:18
Phone (9)
889:1;891:19,22,23;
892:3,4,8,15;893:12
phonecall (1)
851:2
phones (1)
892:1
phrase (3)
731:9;841:12;881:2
physically (2)
874:15;878:2
pick (5)
756:19;763:14;
771:19;773:12,12
picked (3)
738:18;756:23;
784:11
picking (1)
762:3
piece (3)
772:10,25;844:5
place (12)
744:22;769:15;
771:10;782:8;801:23;
822:19;847:14;848:8;
868:1,3;869:9;872:10
placed (1)
724:18
plainly (3)
783:25;792:2;841:23
plaintiff (6)
730:5;742:22;776:9;
781:18;782:4;784:5
plaintiff's (27)
722:4,11;723:1,2,7,
22,24;724:4,15,16;
726:1;727:16;743:13;
746:15;765:12;769:22;
778:19;784:20;794:1,
1;822:7;839:6;841:16;
848:11,13;883:5;
887:20
planned (1)
795:3
platform (1)
875:12
plausible (1)
887:2
play (7)
722:5,6;725:12,15,
16,18;791:25
played (2)
795:9;818:12
playing (2)
722:10;842:10
please (12)
777:22;799:5,6,25;
800:17;849:11,21;
850:17;853:1;856:25;
863:14;879:5
pliance (1)
758:2
plugging (1)
779:6
plus (9)
781:10,16;789:24;
790:8;865:22;867:18;
874:20;879:18;893:20
pm (1)
799:2
podium (1)
726:18
POE (2)
892:5,6
point (34)
730:2;732:8;734:11;
742:9,24;746:1,18;
747:4;754:9,10;
761:23;762:24,25;
764:10;774:23;775:14;
779:8,18;780:6,18;
788:9;790:16,18;
792:16,23;793:15;
807:16;835:9,13;
837:23;841:9;842:10;
858:5;894:3
pointed (6)
749:23;752:1,25;
784:4;840:19;841:21
pointing (2)
764:12;772:9
points (8)
729:13;742:8;743:2,
14;758:3;780:1;
794:14;835:15
police (8)
767:7;841:6;886:6,
16;889:3,11,17;894:10
policeman (3)
748:3,5;885:20
policies (2)
828:15,17
policy (2)
864:13;866:11
poll (1)
785:21
pool (9)
781:11,11;782:23;
783:16;785:15;786:9;
817:15;833:6;849:17
pools (3)
724:20;783:16;
790:11
poor (2)
760:14;840:10
population (5)
780:4;782:20;
783:16;785:15;820:1
portal (1)
867:1
PORTERA (7)
866:1;868:10;869:5;
872:3;873:22;888:3,9
portfolio (3)
739:5;761:12;860:12
portfoliowide (1)
835:25
portion (5)
745:22;781:9;796:8;
811:24;882:10
portions (1)
796:15
pose (1)
730:11
posed (1)
750:6
position (5)
768:16;850:4;
867:15,24;888:8
positions (3)
865:17;886:15;
889:17
positive (3)
809:20,21;817:19
possible (2)
730:4;811:11
post-closing (1)
864:6
potential (2)
831:23;880:14
potentially (3)
880:7,20,21
practical (2)
854:21;855:3
practice (4)
727:23;738:20;
740:2;894:1
practices (4)
724:25;725:1;831:6;
863:6
precise (1)
755:11
Predominantly (2)
871:22;875:24
prefers (1)
875:20
premised (1)
781:3
premium (2)
Min-U-Script® SOUTHERN DISTRICT REPORTERS (19) particularly - premium
849:22;850:18
preparation (1)
814:15
prepare (1)
845:23
prepared (3)
845:20;846:1;851:21
prepayment (3)
812:21;849:19;
850:12
preponderance (2)
747:17;788:3
preposterous (1)
884:15
presence (1)
745:16
present (10)
736:20;746:8,25;
747:1;776:18,21;
812:12,15;815:10,15
presentation (1)
738:25
presented (5)
746:24,24;763:7;
766:7;842:5
presenting (4)
765:14,18;795:4;
843:22
president (19)
722:12;748:6;
800:11;864:2;866:12;
871:17,17;884:10,19;
885:4,13,14,23;886:1,
2,17,21;892:16,17
Presumably (2)
737:20;804:4
presume (1)
739:9
presumptuous (1)
758:19
presupposing (1)
787:13
presupposition (1)
753:6
pretty (4)
749:22;791:9;806:8;
839:17
prevented (1)
788:19
prevention (2)
878:21;880:18
previous (1)
856:7
previously (7)
731:13;794:11;
796:6;819:11;826:14,
15;889:19
price (3)
868:1,3,5
primarily (2)
811:19;822:15
primary (2)
818:13;833:14
prime (2)
858:17;867:18
principal (12)
782:10,12;783:6,6;
809:11;810:4;811:8;
812:2;816:25;817:2,
13;867:19
principle (6)
735:10;758:12;
759:23;760:16;761:19;
791:25
principled (1)
735:23
principles (5)
726:25;727:1;
754:24;760:3;761:11
print (2)
747:12,15
printout (3)
766:3;833:9;890:7
printouts (3)
752:20;765:25;843:1
prior (5)
762:8;804:18;846:9;
865:4;874:2
prioritization (2)
810:3,10
privacy (1)
884:4
pro (7)
811:24;815:3;816:4,
24;817:3,8,11
probably (9)
728:1;773:6;808:3;
843:16;872:13;887:3;
888:9;894:3;895:1
probative (3)
837:25;840:10;
841:21
problem (13)
723:15;730:4,5;
731:8;732:16;746:20;
756:13;767:8;773:3;
832:25;847:25;848:1;
892:10
problems (26)
725:8;743:18;
750:12,17;752:14,15,
16;753:16,17;754:21,
22;755:1,4,21;756:5,
14;765:14;768:17,18,
18,18,20;769:1,12;
783:9;788:24
proceed (1)
895:13
proceeded (1)
769:5
process (75)
722:17;739:21;
741:8,13;743:11;
744:12;749:24;757:17;
759:20;762:15;763:22,
24,25,25;764:17,18;
765:4,19;768:4,9;
769:18;773:2;774:9;
775:7,11;778:7;
779:23;787:4;798:7;
806:1;818:11;819:19;
820:7,11,20,22;821:1,
11,22;825:23;826:1;
830:8,23;831:7,25;
832:2;834:7,8,11,16,
23,23;837:7;842:18;
845:13;846:7,7;
848:23;851:7,17,18;
853:7,13,18,23;855:6;
856:3,6;865:23;873:4,
16;876:14;877:23;
884:20;885:8
processer (2)
872:19,23
processes (4)
826:7;866:24;867:3;
878:22
processing (1)
885:13
processor (1)
873:11
procured (1)
837:19
produce (1)
790:12
product (6)
726:24;740:6;
867:13,22;869:15;
870:7
products (3)
740:8;859:19;870:23
profess (1)
727:20
profession (2)
743:18;762:9
professional (2)
743:25;800:21
proffer (2)
724:8;798:11
proffered (1)
844:20
profile (6)
735:4,8;736:19;
742:14,15;758:7
program (3)
842:3;882:3,6
project (2)
726:13;819:23
projected (2)
857:12;859:3
projection (5)
859:5,11,12;860:2;
861:13
projections (2)
857:16;859:24
promise (1)
789:14
promised (1)
793:20
proof (7)
737:13;776:3;
783:17,25;784:4,16;
788:25
proper (6)
734:16;762:6,10;
778:18;780:25;836:4
properly (4)
780:23,24;784:7;
875:11
properties (4)
756:25;790:13;
868:19;869:21
property (8)
757:13;766:17;
768:18;781:9;867:17;
868:16;880:5,22
proportion (7)
736:22;750:13;
781:14;785:14;789:23,
24;791:9
propose (1)
799:15
proposition (1)
790:1
prosecution (1)
889:22
protection (1)
868:24
protocol (1)
739:17
prove (3)
750:22;839:11,13
proved (2)
789:8,9
provide (3)
745:6;805:2;879:20
provided (18)
768:19;771:10;
819:24,24;824:4,7,8,9;
835:19;847:13;848:7;
849:16,20,21;850:13,
18;853:9,12
providing (4)
728:18;799:18;
880:4,13
public (1)
743:6
publicly (1)
809:14
publicly-filed (1)
813:11
pull (3)
782:24;854:22;855:3
pulled (6)
832:17;837:5;
842:13;853:24;854:2;
874:9
punch (1)
747:11
punted (1)
776:1
purchase (2)
814:7,10
purchased (1)
814:4
purported (12)
730:22;731:14,15;
736:2;738:15;748:6;
758:1;760:5;763:8;
772:14,21;885:14
purportedly (4)
733:14;736:23;
763:10;782:13
purports (1)
742:13
purpose (17)
722:14;724:7,8;
785:17,19;789:22;
796:14,25;811:15;
827:8;837:24;843:5;
846:21;853:7,10;
871:5;880:13
purposes (11)
728:11;736:8;
792:20,22,25;796:6,21;
811:17;842:3,16;
846:22
put (29)
722:15,18;723:17;
724:13;739:11,17;
742:6;744:2;745:21;
748:11;755:9;760:6;
772:16;774:2;783:10;
786:3;799:19;818:21;
819:16;827:20;834:22;
835:5,20;842:9;
844:11;846:18,20;
868:22;887:21
puts (1)
780:25
putting (6)
758:4;772:10;
797:12;799:16;834:15;
889:24
Q
qualification (2)
827:15;865:13
qualified (9)
726:22;728:15;
729:20;734:16;765:9;
806:6;818:16;888:4;
890:4
qualifies (1)
888:5
qualify (6)
820:25;827:13,22,
23;831:11;845:17
qualifying (2)
820:20;881:11
quality (17)
722:17;725:1,2;
731:18;741:7;768:13;
834:23;836:1,25;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (20) preparation - quality
839:5;843:20,25;
844:6,14;866:15,19;
877:8
quarter (3)
723:11;757:13;
766:16
queries (1)
802:5
query (1)
762:18
quick (6)
748:8;770:5;780:1;
847:4;848:3;894:18
quite (3)
767:11;840:17;
841:15
quote (1)
777:7
R
raise (3)
735:4;747:23;748:12
raised (5)
735:8;752:11;
794:11;819:12;844:11
raising (3)
732:16;735:11;886:9
ran (4)
741:1;835:23;
840:22;842:22
random (7)
747:25;785:12,17,
19;787:11;836:19;
842:19
range (2)
861:12,17
ranges (1)
781:19
rapid (7)
811:4,6,12,14;812:7;
814:6;817:12
rare (1)
727:24
rata (7)
811:24;815:3;816:4,
24;817:3,8,11
rate (9)
783:21;787:4,6;
801:12;812:20;858:15,
16,17,18
rather (7)
736:4;748:5;776:23,
25;778:17;782:8;839:1
rating (6)
805:2,12;806:8;
808:4;824:10;832:7
ratio (4)
750:15;753:10,10;
754:7
raw (1)
818:14
reached (6)
737:23;775:14;
811:1,3,4;851:23
read (11)
772:18,19;778:8;
791:7;795:11;796:2;
797:4;814:1;849:11;
850:1;862:11
readily (1)
832:11
reading (3)
789:15;836:24;889:5
reaffirm (1)
839:25
real (2)
783:17;885:22
realistic (1)
764:6
reality (3)
729:17;757:23;
842:13
realize (1)
860:9
realized (1)
812:3
really (26)
747:25;748:12;
749:23;750:3;757:25;
764:20;767:17,25;
776:5;779:24;784:3,
12;787:15;794:1;
808:5;819:13;820:24;
825:20;831:14;843:22;
844:18;862:4;865:23;
866:16;883:3;889:20
realtime (1)
740:10
reason (17)
723:1,16;747:16;
749:3;755:13;757:16;
766:24;773:20;775:10;
780:25;782:6;796:15;
826:16;837:23;839:24;
893:19,20
reasonable (1)
740:1
reasonableness (1)
739:20
reasons (3)
727:3;738:6;884:4
reassess (1)
793:17
Rebecca (3)
726:7,20;730:11
rebut (1)
789:10
rebuttal (4)
726:3;788:12;
789:12,14
recalculate (3)
742:16;752:12;826:4
recalculation (1)
772:14
recall (7)
731:23;747:24;
749:6;760:14,19;
765:20;787:21
recalls (5)
775:22;777:12;
781:12;782:14;783:18
receipt (1)
812:2
receipts (1)
812:1
receive (10)
807:22;808:6;
810:14;816:23;847:22;
848:10;865:7;878:18;
879:2;887:21
received (23)
726:1;732:20;
794:18;795:14;800:22;
807:24;813:16,17;
846:17;848:11,19;
861:4,7;865:4;878:16;
879:1,6;888:11,12;
893:1,6,14,15
receiving (1)
795:14
recent (1)
813:9
recently (1)
728:25
recess (2)
798:17;852:7
recognize (3)
813:3;846:23;848:15
recognizing (1)
756:1
recollect (4)
820:9;851:6,8;
861:16
recollection (4)
787:25;802:23;
823:13;861:11
reconsidered (1)
799:13
reconvene (2)
794:23;894:16
record (25)
734:22;754:11;
770:1;776:4,12;
793:16,17,19;794:11;
814:2;845:16,18;
846:10;847:21,24;
849:11;850:1;862:11;
888:4,6,7,10;890:8,17,
20
recorded (4)
855:9;856:17,17;
861:7
records (4)
743:6,8,10;887:12
recover (1)
857:17
recross (1)
790:17
red (3)
742:17;743:23;
752:11
redacted (1)
748:16
redirect (6)
725:18;783:17,18;
785:9,11;863:10
reducing (1)
783:19
redundancies (1)
752:13
redundancy (1)
741:21
refer (1)
889:21
reference (1)
777:17
referenced (1)
804:2
referrals (1)
740:10
referred (6)
803:10;806:24;
809:22;810:1,21;849:5
referring (4)
734:20;777:24;
817:8,9
refers (1)
834:23
refinements (1)
744:7
reflect (2)
722:19;853:14
reflected (4)
771:11;853:21;
854:9;894:7
reflective (2)
743:22;888:21
reflects (4)
849:22;850:18;
857:7,16
refresher (1)
878:19
regard (7)
743:16;834:22;
840:20;847:18;858:19;
868:20;879:21
regarding (1)
850:3
regardless (2)
779:21;876:10
regents (1)
867:7
Regional (17)
748:20,24;749:7;
802:19,20;841:8;
865:17;883:11,15,21;
884:6,10,19,22;885:12;
886:18;890:15
regular (1)
827:4
regurgitated (1)
773:13
reimbursed (1)
857:21
reimbursement (1)
788:14
rejected (4)
792:2;839:11,16,22
related (1)
879:2
relates (3)
809:24;818:14;857:9
relating (1)
766:22
Relative (2)
869:2;882:9
relatively (1)
869:1
relevance (17)
803:17;804:12;
813:14;824:14,15,20;
825:6;834:2,3,8,18;
847:14,21;868:10;
869:5;872:3;889:14
relevant (12)
729:23;730:17;
798:10,12;803:19,22;
836:8;838:10,12;
840:25;844:17;848:8
reliability (3)
743:3;744:11;792:22
reliable (4)
726:24;735:22;
768:22;776:5
reliably (1)
727:1
reliance (1)
774:9
relied (8)
724:25;730:19;
731:7;732:17,20;
769:10;809:2;854:8
relies (1)
746:11
rely (7)
722:16;725:6;
729:14;734:7,14;
757:8;761:16
relying (6)
731:16;761:9,9,12;
762:16;765:6
remain (1)
862:18
remains (1)
814:11
remedy (1)
767:16
remember (7)
753:19;755:8;
760:13,24,25;780:19;
891:12
Remind (1)
729:24
remotely (1)
Min-U-Script® SOUTHERN DISTRICT REPORTERS (21) quarter - remotely
887:1
removed (2)
821:24;851:25
removing (1)
783:19
render (2)
728:11;791:2
rendering (1)
728:11
RENDON (82)
726:5,17;727:7;
728:4;729:2;730:1,10;
731:25;732:8,12,18;
734:2,8,23;735:7;
736:5;737:5,19;738:3,
9,23;739:2,11,14;
740:4;741:5;742:24;
757:20;759:7;764:8;
765:2;769:24;771:24;
781:2;794:9,14;795:1,
25;796:4;797:8,11;
798:3;799:7,11,24;
804:1,15;830:18;
831:19;835:11;836:9,
12;837:21;838:14;
841:13;842:7;843:16;
863:15,21;866:2,6;
868:12;869:7;870:9,
10,19;872:5;873:25;
887:5,8,24;888:2,17,
19,24;889:15;890:2,8,
17;891:2;894:14;
895:12
renewed (1)
795:15
renews (1)
726:19
rep (3)
766:13;767:2;769:7
repaying (1)
875:4
repeat (3)
747:7;821:20;856:10
repeatedly (1)
746:4
rephrase (2)
805:21;870:16
replete (1)
730:12
report (16)
729:16;730:12;
733:9;758:17,22;
759:10;768:1;772:15;
784:11;817:23;875:23;
879:24,25;880:6;
881:21;887:13
reported (3)
818:1;849:1,3
Reporter (1)
794:8
reporting (3)
864:12;867:9;873:7
represent (5)
725:2;763:9;812:14;
816:10;887:18
representation (4)
750:25;752:2;779:1;
854:3
representations (15)
724:22;746:5;
747:19;754:2,3,6;
757:23;776:7;777:9;
787:5;789:5;839:15,
22;861:23;862:2
representative (5)
722:8;770:25;
836:20;842:19;849:7
representatives (1)
851:4
represented (3)
765:21;822:25;829:1
representing (1)
748:5
represents (3)
760:8;807:19;815:15
repressed (1)
787:25
reps (3)
744:20;757:15;
766:11
repurchase (3)
767:17;784:25;
839:14
repurchased (2)
767:18;788:16
reputable (1)
875:4
request (1)
767:24
requested (1)
758:15
requests (1)
740:12
require (1)
881:18
required (11)
739:23;740:6;755:4;
777:13;814:10;823:17;
827:16,17;831:24;
840:9;881:6
requirement (1)
825:23
requirements (3)
831:10;872:10;
874:20
requires (2)
729:23;837:11
rereviewed (1)
865:10
reserve (1)
793:6
reserved (2)
775:25;793:14
reserves (1)
759:11
reserving (1)
726:3
residence (1)
889:12
residential (2)
776:8;804:6
residual (16)
806:24;807:23,25;
808:20;809:1,7,22;
810:19;812:11,15,19;
816:22;859:24;860:2;
861:14,19
Resolutions (1)
875:21
resolve (1)
729:20
resources (2)
740:18;877:24
respect (13)
723:22,23;731:9;
774:15;775:22;781:6;
787:23;790:10,11;
791:3;802:8;806:14;
828:4
Respectfully (4)
753:8;789:1;824:24;
825:7
respects (3)
748:9;756:16;826:22
respond (5)
747:24;796:8;797:3;
841:13;850:22
responded (1)
850:13
response (7)
847:2,3;850:2,3,8,9,
23
responsibilities (3)
864:3,9,11
responsibility (2)
866:12;867:4
responsible (7)
802:10;808:25;
809:2;818:25;819:2,
23;862:5
rest (1)
768:25
restraint (1)
743:25
result (4)
736:12;752:20;
757:5;810:22
resulted (1)
853:23
result-oriented (3)
727:22;728:1;744:1
results (8)
743:19;744:13;
756:18;757:17;764:11;
774:11;775:7;841:23
results-oriented (3)
727:11;728:6;743:19
resume (2)
743:16,17
resumes (4)
722:1;731:12;799:3;
874:21
retail (10)
729:6;802:24;
867:12;871:22,23;
872:2,7,17;873:1;
876:11
retained (4)
722:16;725:3;
806:22;807:24
retirement (1)
886:6
return (3)
785:7;816:25;881:19
returns (10)
738:21;740:3;
865:13;881:6,9,16,17,
19,21;882:1
reunderwrite (1)
836:16
reveal (2)
855:22;856:16
revealed (3)
725:9;747:12;886:12
reverification (1)
866:24
reverify (1)
773:2
reverse (2)
890:25;891:13
review (27)
725:4;731:24;
732:14;733:6,7,14,19,
21;734:4;735:10,18;
738:15;741:12;748:8;
768:12;772:21;824:19;
832:9,11;838:20,23;
865:10;870:6;874:8,
17;881:18;883:6
reviewed (7)
723:10;732:22;
742:5;756:8;772:22;
874:11;884:1
reviewer (1)
733:3
reviewers (5)
734:25;735:16,21;
741:9,10
reviewer's (1)
731:15
reviewing (6)
836:24;874:5,15,21;
880:17;881:17
right (59)
726:3,4,17;729:2;
738:16,22;739:10;
743:13;747:10;749:14;
752:16,23;759:7;
761:20;765:16,17;
769:21;774:25;775:2;
779:9,23;780:2;
782:24;785:9;787:6;
789:12;791:5,14,17,24;
792:8;793:18;794:23;
798:15;799:6;802:23;
805:22;812:7;820:21,
23;828:4;829:4;
832:22;833:4;837:17;
840:14;850:7,14;
852:6;853:1;862:9;
883:1,24;890:12,13;
891:25;892:10,22;
893:5
rings (1)
889:1
risk (91)
728:9,19;731:15;
732:21;734:25;735:4,
8,11,16,21;736:12,19;
738:10,15;741:1,23;
742:3,12;744:21;
745:2,6,20;747:10,11;
748:17;750:18,19;
752:18;754:5,12,16;
755:18,23;756:1;
758:7;760:5,11,14;
761:4,7,20;762:7,13,
16;763:6;765:16,16,17,
18,24;766:3,6,8;
767:10,10,15,20;
768:19;770:9,13,17,23;
771:6,8,10,20;772:3,5,
20,23;773:4,6,10;
775:11;793:4;801:12;
810:18;836:5;837:10,
13,15;838:4,19;840:8;
843:10;844:14;858:22;
865:17;868:24;869:23,
25
riskier (3)
754:7,8,10
risks (2)
867:21,23
Risk's (2)
765:24;772:22
risky (1)
836:3
road (1)
764:7
robust (1)
731:5
role (13)
800:10,13;801:6,8,
19,19,22,23;802:1,3;
806:16;818:12;864:16
roles (3)
802:3,8;806:14
Romney (1)
785:22
room (1)
733:18
Roslin's (1)
834:20
rough (1)
787:25
Min-U-Script® SOUTHERN DISTRICT REPORTERS (22) removed - rough
rounded (1)
781:12
routine (1)
877:21
routinely (3)
820:17;878:5,19
routines (1)
854:14
Rule (13)
726:7,20,21;727:4;
766:25;778:11;784:2,
3,17;796:2;797:5,7;
845:15
rules (7)
745:17,18,19;
753:10,10;765:8;847:7
ruling (1)
839:9
run (4)
749:18;784:24;
789:5;796:14
running (3)
740:9;741:11;768:22
S
S&P (1)
849:16
sake (2)
734:3;838:11
Salary (9)
737:18,19,21,22;
738:3;740:10;741:24;
742:13;745:11
Salarycom (1)
752:8
sale (5)
844:4;861:5,7,8,9
sales (4)
844:4;866:17;880:4,
20
salvo (1)
728:7
same (31)
723:22,23;731:14;
755:1,2;768:9;770:19,
21;771:19;773:14;
777:18;778:3;781:15,
19;787:19;790:12;
808:17,19,23;812:18;
827:4,9;835:18;
848:17;856:17;859:5;
873:16;877:12;885:16;
887:16;888:20
sample (47)
754:20,20;761:15;
777:10,13,15;778:13,
20,21;779:8,12,15,21,
22;780:4,9,14,15,16,
20,23;781:6,10,13,19,
25;783:14,24;785:2,14,
18,20,24;787:11,13;
789:9,20,21,22,23;
790:2,7,10;791:8;
792:1;836:20;837:1
sampled (3)
791:21;792:12;
836:19
samples (5)
725:4;781:9;785:13;
790:23;842:19
Sampling (4)
775:21,22;776:2,10
satisfied (3)
807:1;812:4;854:14
satisfying (1)
761:1
savings (2)
802:17,18
saw (6)
742:9;745:2;748:8;
756:3;762:6;769:22
saying (28)
735:7;736:8;743:1;
748:9;749:6,9,25;
753:24;756:12;766:15;
772:25;773:6;779:1,3,
7,11,11,19;780:2,5,6;
785:1,2;790:15;
792:17;830:10;840:4;
858:13
SBNP (1)
889:1
scare (1)
762:16
scary (1)
761:13
Schedules (1)
881:8
scheduling (2)
793:2;894:19
scientific (1)
735:25
scientist (1)
736:3
scope (1)
755:6
score (3)
754:7,8;841:3
scores (2)
824:2;882:5
Scott (12)
723:8;863:15,17,22;
867:21;870:11,21;
872:15;876:14;887:9;
890:3;895:12
screens (1)
762:13
se (1)
728:3
sealed (1)
794:21
search (2)
807:15;820:17
seated (2)
799:5;853:1
second (33)
723:11,17;724:14;
738:16;746:11;747:20;
756:7,9;766:10;
770:20;771:3;780:6;
788:5;790:16;797:11;
810:6;811:18;819:13;
826:10;843:9;844:17;
847:25;849:10,10;
850:10;856:5;857:3,
10;862:11,17;867:24;
869:19;880:23
second-lien (4)
859:18;867:8,15;
868:16
seconds (4)
723:14;849:15;
850:7;867:8
securing (1)
802:6
securities (5)
805:1,5,25;810:4,5
securitization (69)
723:21;724:20;
798:7;802:2;804:20,
24,25;805:6,7,13,16,
24;806:6,18,22;807:1,
2,4,11,15,17,18,25;
808:10,12,14,16;809:8;
811:10;814:3;817:4,5,
21;818:16,16;820:3,11,
14,16,25;821:2,24;
822:5;826:19;827:3,
13,17,24;828:6;831:11,
17,23;833:6,10;836:2;
843:21;844:2,3,6,8;
848:23;849:4,7;852:1;
858:20;861:8,10,15,18
securitizations (15)
724:19;725:10;
803:22;804:4,11,18;
806:15;808:2;810:15,
20;814:11,13;824:9;
826:25;859:24
securitizing (2)
804:6;826:15
security (2)
747:11;809:13
seeing (3)
733:2;741:18;773:23
seek (1)
763:23
seeking (3)
725:6;737:3;884:18
seem (3)
722:14;739:5,8
seemed (1)
744:7
seems (5)
722:18;727:24;
739:2;779:18;821:15
sees (1)
772:24
segment (2)
880:19;882:4
selected (3)
757:8;772:6;785:13
selection (8)
723:11;818:11;
819:2,19;820:7;
834:24,25;851:16
selections (1)
835:6
self-employed (6)
740:13;865:13;
878:20;881:5,24,24
self-employment (2)
880:24;881:1
self-serving (1)
846:9
sell (2)
821:7;834:21
send (3)
747:13,15;750:16
sending (1)
849:12
senior (2)
722:12;864:24
sense (8)
738:20;743:24,24;
767:12;778:3;785:3;
869:11;894:24
sent (2)
851:25;891:10
sentence (4)
736:20;797:22;
836:9;847:11
sentences (1)
814:1
separate (3)
774:6;840:18;843:23
sequel (1)
819:20
sergeant (4)
841:6;889:3,11;
894:10
series (4)
722:25;736:17;
743:2;847:17
serious (3)
737:7,8;776:25
seriously (1)
889:20
served (1)
754:12
servicer (4)
809:19;810:7;
860:21,23
servicing (17)
833:13,15,16,17;
842:14;860:20,24;
887:9,11,13;888:20;
889:5,6;890:8,17,20;
891:18
serving (1)
749:2
SESSION (3)
799:1;881:7,9
sessions (1)
865:12
set (5)
723:17;728:16;
793:5;803:8;820:24
setting (1)
864:13
settlement (1)
872:10
several (7)
802:3,4;808:3;
815:10;822:1;851:10;
891:14
severity (7)
736:13;777:1;778:7,
24;779:2;780:12;868:7
shape (1)
802:10
share (9)
815:3;816:4,24;
817:3,6,7,8,9,11
shares (1)
817:10
sharing (1)
812:1
Sharon (1)
723:9
sheet (6)
801:12;806:21;
826:24;827:21;868:23,
25
sheets (1)
890:24
SHIN (45)
800:1,6;803:19;
804:16,23;805:11,21,
23;812:24;813:2,13,
18;819:8,17;820:6;
821:10,21;823:7;
825:9,14,22;834:3,19;
844:21;845:5,12,16,19;
846:4,12,22;847:10,15;
848:12,17,20;851:1;
852:2;854:24;855:11,
24;856:1;862:13;
863:7,11
shocking (1)
748:3
short (3)
783:13;788:2;789:15
shorthand (1)
891:17
show (12)
725:7;742:6;769:10;
772:12;773:1,5;821:3;
831:22;842:25;846:20;
883:1,6
showed (7)
738:4;748:15;751:2;
756:9;758:15;781:22;
808:13
Min-U-Script® SOUTHERN DISTRICT REPORTERS (23) rounded - showed
showing (4)
747:16;813:14;
844:6;847:6
shown (4)
776:5;782:16;
788:21,24
shows (9)
727:21;748:22;
757:2;758:22;762:15;
776:4;791:25;796:9,16
Shrev (1)
723:9
shrewdly (1)
840:17
shuffling (1)
895:4
side (3)
737:24;787:21;
837:12
sidebar (4)
794:3,4,7,20
sideline (1)
886:19
sides (1)
792:25
sign (2)
829:3;889:2
significance (4)
808:1;817:17;
870:12,15
significant (3)
729:4;808:4;820:14
similar (4)
750:25;752:9;
816:24;861:16
similarly (1)
812:11
simple (1)
749:22
simply (10)
724:25;732:17;
747:7;748:18;754:14;
756:11;767:21;792:3;
795:6;838:16
single (8)
736:17;744:15;
746:15;755:12;756:24;
757:1;775:4;879:9
SISA (1)
723:14
sit (7)
761:10;768:12;
788:2;797:19,20,22;
840:11
site (1)
874:12
sites (1)
741:25
sitting (3)
761:6;766:15;894:22
situation (9)
771:22;778:11,15;
787:11,14;835:3;
848:10;859:14;886:10
six (6)
749:23;768:1;859:5,
9,17;870:5
six-month (1)
857:13
size (22)
777:11,13;778:13,
20,21;779:8,21;780:9,
15,15,16,20,23;781:6,
10,13;783:15;785:2,
25;789:20;790:10;
861:16
sizes (2)
781:19;783:15
skew (1)
779:22
skilled (1)
802:5
skills (1)
849:5
skin (3)
808:5,9;843:24
skipped (1)
762:12
sloppy (1)
743:11
slow (1)
727:6
small (5)
748:4;749:24;752:4;
790:1;799:8
smaller (5)
777:15;779:8;
780:16,20;882:8
Smith (3)
892:25;893:1,4
snipets (1)
722:5
soared (1)
756:6
so-called (2)
724:14;738:19
social (1)
747:11
sold (2)
807:10;861:2
sole (1)
841:1
solid (1)
851:22
solution (1)
764:10
solutions (1)
728:19
somebody (4)
728:17;758:20;
806:2;858:24
somebody's (1)
893:2
somehow (1)
750:4
someone (17)
753:21;757:3;762:8;
764:24;766:14;768:22;
770:15;774:21;797:9;
798:6;827:2,22;831:2;
837:14;882:19,21;
889:5
sometimes (2)
740:12,24
somewhat (1)
840:1
somewhere (2)
733:12;861:12
soon (1)
886:20
sophistication (1)
804:5
Sorry (10)
723:3;732:12;
737:17;770:14;792:5;
826:8;848:16,20;
888:16;891:14
sort (5)
819:14;821:25;
885:25;886:11,19
sound (3)
726:11;770:21;
874:20
sounded (1)
777:4
sounds (1)
876:21
soup (2)
758:9;759:13
sour (1)
839:3
source (2)
833:14;853:20
sources (2)
832:24;874:11
south (2)
839:10,23
Southern (1)
864:25
spat (1)
779:6
speak (10)
730:22;732:22;
734:6;735:1;736:5;
737:4;741:11;775:19;
890:3,4
speaking (4)
728:8;734:23;
819:14;835:13
special (1)
827:12
specific (14)
730:25;740:5;
755:10;766:11;767:1;
788:25;789:1;796:24;
819:12;843:2;870:6;
881:9;890:4,5
specifically (7)
724:4;744:9;776:9;
796:10;843:8;884:9;
888:14
specificity (1)
730:19
speculation (2)
848:2;856:1
speculative (1)
855:11
speech (1)
744:5
spend (3)
750:2;767:24;795:17
spending (2)
847:22;878:3
spent (4)
750:4,8,9;826:6
spit (1)
840:23
spitting (1)
842:23
spoke (1)
799:13
sponsored (1)
803:10
spreadsheet (6)
753:17;771:11;
781:21;782:1,14;786:4
Spring (1)
864:8
squarely (2)
839:8,17
staff (13)
864:12;867:9;873:7;
876:17,25;877:1,21,24;
878:4,8,15,23;879:15
stage (2)
733:15;784:14
stamps (1)
883:3
Stan (1)
800:1
stand (4)
755:19;840:10;
855:1;863:16
standard (5)
735:23;736:9;
741:17;765:5;769:3
standards (13)
729:10,18,23;
730:14,16,17;736:2,3,
25;774:11;828:2,5,7
standpoint (2)
868:7;869:18
stands (1)
892:6
STANLEY (1)
800:2
start (6)
726:16;785:3;
810:18;812:5;871:23;
872:1
started (12)
749:25;764:24;
831:25;832:2,24;
864:23;866:8;867:11;
871:24;872:7,11,25
starting (4)
777:25;791:10;
871:17;872:7
starts (1)
811:22
state (12)
739:22;740:18,19,
20,21;793:16,17,19;
800:20;865:22;875:11,
13
stated (23)
738:19;739:4,5,13,
14,15,19;740:8;750:4;
795:21;809:25;819:20;
820:23;828:19,24,25;
830:3,16,20,24;881:22,
23;882:10
state-level (1)
872:10
statement (6)
731:10;804:2;
806:21;846:9;889:15;
891:10
statements (6)
740:13;769:25;
773:16;806:20;837:20;
893:23
states (6)
726:21,24;803:12;
872:11;875:22;886:19
state-specific (1)
872:9
stating (4)
778:22;881:25;
889:7,8
statistical (5)
765:22;776:2;
783:14;790:12;791:25
statistically (1)
791:1
statistician (4)
726:12;786:2;
789:11;791:2
Statistics (7)
752:9;777:5;780:19;
784:22,23;787:9;
790:20
status (1)
821:25
statute (1)
749:17
statutory (1)
788:23
stay (1)
880:11
step (5)
726:17;802:15;
821:3;841:17;863:12
steps (8)
724:20;773:1;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (24) showing - steps
831:18;840:6,12;
851:16;862:1;875:6
Stewart (3)
726:8;764:22;775:18
Sticking (1)
824:12
Stiehl (5)
796:11;835:21;
836:13;842:25;848:24
still (11)
768:12;771:7;
801:10;808:18;816:13,
15,25;835:9;873:19;
886:5;892:9
stop (3)
724:5;786:1;790:14
stored (1)
820:17
stories (1)
731:4
story (3)
736:14;754:23,23
straightforwardness (1)
840:3
stratifi- (1)
835:24
stratification (2)
842:22;843:18
stratifications (1)
796:18
stratifies (1)
796:12
streamline (1)
798:13
strength (1)
752:17
strengthen (1)
868:4
strengthens (1)
868:5
strict (2)
767:11,16
strike (1)
775:10
striking (1)
744:13
strong (1)
760:7
struck (1)
765:10
structure (10)
801:12;802:3;
807:10,20;809:8,23;
810:6,23;811:10,18
structured (1)
802:9
structuring (1)
805:1
stubs (4)
738:21;740:3;882:1,
21
stuck (1)
837:5
studies (5)
879:10,14,18,20;
880:17
stuff (2)
758:8;759:17
sub-examples (1)
790:24
subject (13)
726:2;727:16;753:5,
20;762:23;798:5,7;
799:17;813:14,16;
819:6;838:15;855:14
subjective (9)
753:4,5,9;754:17;
770:10;778:7,17;
779:20;780:3
subjectivity (1)
771:17
submission (2)
725:25;843:20
submit (3)
725:23;789:9;842:1
submitted (3)
775:23;792:16;
794:15
submitting (1)
799:16
subordinated (1)
816:25
subparts (1)
727:7
sub-prime (3)
871:11,13,18
subsequent (1)
814:5
subset (1)
826:11
subsidiary (1)
800:24
substantial (5)
746:23;754:15;
755:24;788:24;886:17
subsumed (1)
779:25
subtract (1)
816:3
sufficient (4)
733:18,20,23;750:21
suggested (1)
850:3
suggesting (1)
819:3
suggests (3)
764:5;891:23;892:10
summarized (1)
728:16
summary (3)
837:22;839:8,25
summer (4)
864:17;867:4,6;
892:22
supervised (1)
828:14
supplied (1)
771:5
support (11)
775:3;802:13;805:2;
811:19;815:18,21;
816:11;820:16;827:16,
17;853:13
supported (2)
827:20;879:25
supports (1)
801:22
suppose (2)
724:11;887:23
supposed (7)
730:5;761:16;763:1,
6,13;783:25;893:8
supposedly (1)
783:4
Sure (37)
723:4;724:5;734:2,
19;740:5;749:9;752:5,
6,14;761:21,23;
769:25;775:10;777:17;
779:10;786:10;788:4;
797:18;799:17;818:15;
820:18;826:5;832:5;
836:8;841:7;843:10;
851:20;853:8,10,14;
856:12;874:19;875:3;
877:9;887:21;889:13;
892:15
surely (1)
885:22
surface (1)
740:14
surrebuttal (1)
771:23
sursurrebuttal (1)
771:24
survey (4)
729:15,17,21;730:22
Susan (1)
764:23
sustain (1)
870:18
sustained (13)
757:17;803:18;
804:14;819:16;821:9;
825:8,13,21;862:16,18,
21;863:8;869:6
switched (1)
892:1
sworn (2)
800:4;863:19
system (15)
822:3;831:13,20;
832:18;833:13,14,15,
16,17;836:18;854:1,2,
4,5,8
systems (2)
833:12,24
T
tab (1)
813:19
tabbed (1)
856:25
table (4)
814:12,16;857:3,7
talk (17)
729:12;732:8;
737:25;745:4,5;
763:14;765:15;766:10;
767:23;833:24;864:18,
19,20;868:23;872:14;
876:14;880:3
talked (13)
729:16;737:9;
760:21;761:25;778:10;
781:20;788:10;816:19;
842:11;846:6;866:18;
892:18;893:7
talking (33)
724:3;731:11;
734:12,20;736:6;
738:10;757:25;765:15;
767:12;777:17;778:12;
781:2;822:17,18,18;
831:15;835:21;838:2,
16;839:16;840:18;
841:11,25;842:2;
843:23;855:16;858:7;
868:24;878:5;879:11;
889:16,25;890:1
talks (4)
723:10,11;731:11;
735:5
tape (56)
724:7;725:19;
796:12,13;802:7;
819:22,24;822:24;
823:8,10,12,18,19;
824:13,20,22;825:5;
834:4;835:14,19,20;
836:21,22;837:1,6;
838:17;840:19,22;
841:1,7,18;842:1,2,15,
21;843:17;844:23;
845:4;849:22;850:18;
851:13,21,22,23,25;
853:8,11,14,21,24;
854:16;855:10,13,21;
856:13,18
tapes (5)
806:5;840:21;
847:16,18;851:12
tax (11)
738:21;740:3,12;
865:13;881:6,8,16,17,
18;882:1,21
teach (1)
879:22
team (3)
843:12;844:24;
848:25
technique (1)
776:5
technology (4)
865:22,23;866:15;
875:12
telephone (1)
889:12
telling (4)
761:10;774:8;
784:21,24
tells (7)
736:14;742:8;
754:22;764:22,22;
787:12;895:2
ten (1)
784:11
term (3)
736:4;744:3;867:8
terms (15)
724:12;728:8;
734:21;736:5;744:9;
749:21;750:21;754:25;
765:24;814:3;819:11;
867:16;868:8;869:19,
19
Terrasi (1)
866:14
terrible (2)
756:25;764:15
test (4)
741:25;743:4;
748:11,11
testament (1)
728:9
testified (27)
728:23;730:19;
733:5;735:17;736:10;
744:25;745:15,16,19;
747:11;750:22;755:10;
756:5;767:9;776:14,
16,21;780:7;781:8,13;
788:10,16;800:4;
818:24;836:13;838:14;
863:19
testifies (1)
733:7
testify (12)
726:23;734:10;
747:5;761:6;764:14;
791:2;797:15;803:23;
818:23;835:22;845:13;
847:17
testifying (5)
757:21,22;760:16;
834:7;837:5
testimony (70)
724:24;726:7,9,20,
24;727:21;728:2,11;
730:11;732:9,19,23,24,
25;733:4,17,20;
734:14;736:9;738:18;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (25) Stewart - testimony
739:15;745:24;746:9,
19,23;750:5;753:20;
754:1,3;755:7;759:16,
19,24;761:1,18;762:1;
763:11;765:9;774:16;
775:13;776:4;778:1,8,
23;780:11;781:5;
785:3;788:12,21;
789:10,15;791:6,24;
792:22;793:11;798:10;
799:20;819:5;834:2,
20,23;835:15,17;
838:15;842:1;843:17;
862:19;876:10;883:25;
890:5
testing (1)
738:5
Thanks (2)
849:12;895:15
theoretical (2)
854:20,21
thereafter (1)
724:3
therefore (1)
840:9
thick (1)
740:8
thin (1)
772:6
thinking (1)
761:17
thinner (1)
772:7
third (7)
722:15;725:3;731:8;
749:11;756:19;839:1;
850:17
Thirdly (1)
856:7
third-party (2)
836:15;842:20
thorough (1)
851:13
thoroughly (1)
732:6
though (8)
724:6;725:10;
761:16;765:20;796:4;
841:22,23;854:18
thought (9)
724:12;731:4;
736:20;738:18;739:25;
779:11;787:25;795:8;
860:8
thousand (3)
757:13;886:4;888:16
thousands (2)
761:15;782:19
three (15)
723:24;724:2;760:4,
5,11;779:13,14;795:4;
869:20;870:5;872:16;
873:15;878:10;881:7;
891:3
thresholds (1)
811:3
thrilling (1)
883:3
throughout (2)
754:21;851:15
throwing (1)
756:12
Thursday (1)
894:24
thus (1)
847:6
ties (1)
865:19
till (3)
793:6,14;797:19
time! (1)
739:1
time-frame (2)
801:11;820:8
times (4)
833:17;879:19;
893:20;894:5
timing (3)
795:2,7;838:5
tiny (1)
766:21
Tire (2)
736:4,7
title (2)
864:1;885:9
today (12)
732:25;743:3;762:4;
793:21;797:10,15,19;
844:11;860:6;883:5;
887:7;894:16
today's (1)
742:13
together (1)
840:17
told (7)
731:21;732:15,15;
764:5;779:9;830:15;
831:17
tomorrow (8)
797:20;847:5;887:7;
894:17,21;895:5,8,11
tone (2)
854:25;889:1
tonight (1)
797:18
took (14)
732:5;733:7;747:24;
759:22;767:10;792:13;
822:19;834:4;840:3,
22;847:13;848:8;
851:13;862:1
tool (2)
866:25;867:1
tools (4)
866:23;878:22;
880:7;884:22
top (5)
785:9;810:2;849:10;
865:22,22
topic (2)
795:16;844:25
total (2)
782:20;815:1
totally (4)
729:22;755:14;
779:19;787:8
touch (1)
790:20
towards (3)
838:9;865:18;869:14
track (3)
876:2;890:14,22
tracked (1)
875:13
tracks (1)
876:3
traditional (1)
841:11
train (1)
867:2
training (32)
726:22;864:24;
865:1,5,7,9,11;868:24;
877:8,11,12;878:16,18,
19,21,25;879:2,5,7,20,
21;880:11,13,15,18,19,
19,23,23;881:1,9,15
transaction (29)
796:20;802:7,9,12;
806:2,3,9;808:7;809:5,
10,23;810:2,18;
814:24;815:17;818:18;
836:4,4;838:6;843:24;
853:13;854:10;857:12;
858:4;860:16,17;
861:5;868:17;880:9
transactions (7)
804:7;834:5;843:9;
861:23;862:24;868:2;
871:10
transcript (11)
722:24;777:22;
780:8;795:6,11,14,22;
796:8,16;797:9,13
transcripts (1)
798:1
transferor's (28)
810:22,24,25;
811:15;812:6,10,20,23;
813:22;814:1,9,14;
815:5,6,11;816:6,21;
817:18,23;818:5,8;
819:1;857:9,11;858:3;
859:3,6,16
transferred (1)
814:5
transform (1)
835:5
trapped (1)
807:18
treasurer (2)
800:11,15
treasury (1)
800:25
treat (1)
827:8
treated (1)
827:9
tremendous (2)
832:25;851:15
Trial (6)
722:1;776:12;780:8;
793:7;797:4;799:3
trials (1)
784:3
tried (2)
730:15;731:6
triggers (1)
767:16
trouble (2)
833:19;892:4
troubled (1)
762:1
troubling (1)
747:1
Trough (1)
723:10
Trout (1)
725:4
true (11)
725:4;735:15;739:6;
745:24;753:1;759:18;
763:19;767:14;773:4;
787:16,16
trumping (1)
866:17
truncated (2)
738:25;739:16
trust (16)
788:18;798:8;
810:25;814:6,9,11,19;
815:19,22;816:10;
817:1,4,5,9;818:5;
861:2
trustee (3)
809:18;810:7,14
trusts (4)
814:3,13;818:11;
834:22
try (4)
743:4;756:20;
758:10;799:12
trying (21)
722:19;727:8;728:6,
11;734:11,14;743:19;
766:19,20;778:23;
780:9,12;782:7;
785:10;796:21;799:11;
818:15;825:24;842:8;
851:19;879:22
turn (9)
722:3;806:14;
813:19;856:25;857:24;
861:13;862:7;884:3;
888:13
turned (3)
809:6;816:14;886:20
Turning (1)
891:3
turns (3)
749:17;786:8;837:13
twelve (1)
820:9
two (32)
728:14;742:8;
744:20;766:16;770:15,
16;780:1;785:7;788:1;
797:21;798:9;800:15,
16;811:17;812:6;
830:13;840:16;846:14;
855:22;856:8;857:3,8;
865:2;873:13;875:19;
886:15;888:16;889:17;
890:24;892:4;893:7;
895:13
type (19)
758:8;778:11;
796:22;820:15,16;
823:1,2;827:20;
843:10,18;844:7,7;
865:7;866:17,25;
879:5;880:14,23;
881:15
type-caps (1)
869:17
types (7)
753:16;759:11;
801:13;826:2,7;843:3;
847:17
typical (9)
823:4;844:3,7,7;
846:13;847:16;851:10,
11;863:4
typically (8)
763:24;828:3;
867:15,18;878:3,10;
882:4;889:9
U
U126 (2)
773:19;774:21
ultimate (6)
766:7;773:17;
774:21;796:14;853:10,
12
ultimately (19)
731:24;736:19;
745:8;746:21;769:20;
775:4;777:19;778:3,
15,16;807:24;810:7;
817:14;819:23;839:23;
843:5;853:17;864:13;
880:8
unadorned (1)
Min-U-Script® SOUTHERN DISTRICT REPORTERS (26) testing - unadorned
771:18
unarticulated (1)
761:19
unchallenged (2)
745:25;755:11
unclear (1)
798:9
unclosed (1)
757:1
uncommon (1)
827:19
under (24)
726:7,19;727:4;
729:13;736:7,16,21;
739:3;745:10;746:19;
761:12;762:5;765:6,8;
775:9;780:20;782:1;
783:13;784:17;814:1,
3,20;839:13;860:4
under- (1)
830:7
underlying (6)
759:23;774:10;
787:15;796:19;817:7;
857:20
understands (1)
834:14
understood (4)
731:17;777:6;792:2;
883:24
undertake (1)
837:15
undertaking (1)
726:13
underwrite (1)
873:9
underwriter (15)
727:12;728:22;
729:19;736:15;745:9,
10;759:13;767:5;
864:24;865:1,8,8;
880:6;881:17;884:20
underwriters (32)
729:14;730:21;
738:11;750:12;768:16;
771:19;773:15,22;
775:1;864:25;867:2;
868:23;876:16,22,23,
23;877:1,3,4,9,17,17,
22,24;878:12,15,18;
879:1,6,17,21,23
underwriters' (1)
878:8
underwriting (114)
722:12,17;724:23,
25;725:8;727:13;
729:5,8;730:20;
738:13,14;739:17,21,
24;740:7;744:18;
745:10,11,12;753:10;
754:25;756:15;758:2,
4,5,24;759:4,14;760:9;
763:15;765:19;766:12,
22,25;767:22;768:8,9,
11;769:3;777:8;784:5,
6,9;789:1,4;801:24;
803:7;822:3;823:17;
824:4;830:23;831:6,7,
7,8,13,20;832:18;
835:16;836:17;838:3,
4,19;842:16;843:12;
853:18,20;854:1,2,4,8;
855:7;862:4;863:3,6;
864:6,10,12,12,14,19,
20,21;865:2,3,17,18;
866:8,10;867:6,7,9,10,
11,20;868:20;869:4,8,
13,14;870:22;871:4,5;
873:15,19;876:14;
877:2,16,25;878:8,12,
15;879:1;890:9
underwritten (4)
743:20;763:3;822:2;
832:15
underwrote (4)
729:3;873:6;876:12,
15
undisclosed (12)
753:11;755:3;
757:12;762:21;763:4,
5;765:7;766:11;
771:13;772:9,10;
773:12
undisputed (1)
789:2
unfamiliar (1)
743:9
union (1)
872:22
unique (5)
736:13;758:9;
760:10;774:5;776:14
unit (1)
869:21
United (1)
803:12
University (2)
800:18,20
unknown (1)
734:15
unless (3)
779:21;795:9;808:7
unqualified (3)
729:9;734:15;765:7
unquestionable (1)
747:18
unquestionably (1)
766:18
unreasonable (2)
740:1;750:14
unreliability (1)
762:16
unreliable (3)
738:6;765:6;781:7
up (36)
722:22;738:18;
748:15,18;756:4;
761:6;764:10;768:11;
772:24;781:12,21;
782:24;783:8,21;
786:4;787:4;790:4;
793:23;797:17;807:22;
809:7;810:22;822:6;
831:22;834:5;841:18;
844:2;859:11;867:16,
16;868:17;878:14;
883:5;892:3;893:9;
895:8
upon (17)
729:14;730:19;
731:7,16;732:20;
743:6;761:9,9,16,18;
762:16;765:6;769:10;
791:19;792:10;814:6;
837:1
upper (1)
781:24
usable (1)
834:15
use (19)
737:18,21;745:11,
12;759:3;760:15,16;
785:23;786:5;789:8;
809:6;841:1,12;842:2;
858:11;879:18;880:10;
881:20;883:4
used (13)
724:9;739:18;745:8;
747:6;755:16;757:12;
773:15;785:16;790:23;
827:3;833:6;843:5;
883:17
uses (1)
745:9
using (16)
733:1;738:3;741:24;
743:3;773:25;778:2;
786:9;790:1;809:12;
822:2;858:17,21;
880:20;883:19,20;
884:24
usual (1)
744:7
usually (2)
727:23;734:22
utilized (2)
781:7;843:19
V
vague (3)
833:1;863:7;870:17
vaguely (1)
735:5
valid (3)
761:17;787:12;791:1
validation (5)
825:11,23;832:1,5;
854:13
validity (1)
834:17
valuation (10)
743:3;768:18;
812:17;817:23;818:5,
8;819:1;832:3;861:19;
880:4
valuations (1)
743:1
value (19)
809:1;812:12,15,19;
814:13;815:5,6,7,8,10,
15;817:19;819:7;
823:15;826:3;857:16;
858:3;879:25;880:22
valued (2)
812:10,11
valuing (2)
808:20;812:5
variations (1)
736:11
variety (1)
845:2
various (11)
740:4;745:20;
756:15;865:13;866:23,
24;874:5,11;875:22;
881:20;885:2
vast (3)
869:17,17;877:4
vastly (1)
766:22
veracity (1)
743:4
verification (3)
739:20;741:3;882:1
verified (7)
735:24;739:7;830:7,
9,23,25;831:1
verify (1)
831:4
versions (6)
737:7,8,11,12;834:4;
847:19
versus (4)
760:17;761:8;
779:16;830:3
vetting (1)
843:8
via (2)
891:15;893:9
vice (4)
722:12;800:11;
864:2;892:16
videotape (3)
795:4;799:16;842:10
videotaped (1)
799:15
view (5)
752:20;753:14;
795:16;798:2;835:13
vintage (2)
849:20;850:12
violated (3)
744:18;746:5;759:15
violation (1)
885:7
violations (2)
778:25,25
violative (1)
838:4
virtually (4)
819:25;820:23;
821:16;851:14
visit (1)
874:12
VM (2)
892:5,6
voicemail (2)
892:7,9
volume (1)
882:10
W
W-2 (1)
881:24
waffling (1)
727:25
wage (1)
881:24
wait (3)
794:25;842:4;850:5
waive (1)
837:17
walk (1)
758:5
walked (1)
743:2
walks (1)
724:1
walk-through (1)
842:25
Walzak (77)
726:7,15,21;727:3,5,
9;728:5;729:3,7,13,19;
730:18;731:8;732:10,
19;734:24;735:2,9;
737:6,10;738:13;
739:2,8,18;741:13;
742:4,11;743:5;
749:22;750:16,22;
751:1;754:6;755:5,6,
10,25;756:17;758:4,12,
25;759:17;760:1,10;
761:6;762:10,13,19,21;
763:19,21;764:14;
765:2;766:24;768:6,
19;769:5,10;772:5,6,
11,15,22;773:2,11,16,
18;774:1,14;775:1;
776:14,16,21;778:24;
781:4;838:10;883:4
Walzak's (12)
730:11;733:17;
740:23;742:19;748:7;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (27) unarticulated - Walzak's
757:23;762:5;769:7;
772:17;777:17;781:3;
784:11
wants (2)
723:17;797:3
warehouse (3)
832:17,24;872:22
warranties (10)
744:20;746:6;754:2,
3;757:24;776:7;777:9;
839:15;861:24;862:3
warranty (1)
839:22
Washington (1)
876:24
waterfall (6)
810:1,2,9,11;812:4;
817:1
way (25)
734:18;736:1,6;
744:2;761:15;765:14;
769:22;771:19;777:15;
784:7;787:14;793:15;
799:19;828:1;834:13;
839:16;840:6;841:11;
845:18;852:4;855:10,
13;871:6;876:9;885:10
ways (5)
744:10;750:18;
779:22;795:18;860:17
weaken (1)
868:4
weakens (1)
868:5
weakness (2)
752:16,22
wean (1)
860:22
web (2)
741:24;749:7
websites (1)
885:2
Wednesday (1)
797:22
week (6)
755:7;799:12;
839:19;840:24;851:8,
10
weeks (4)
733:8;749:23;
766:16;768:1
weight (6)
725:11;752:23;
769:20;775:8,12;823:5
wending (1)
769:22
weren't (5)
744:17;784:8;808:6;
820:24;844:1
West (2)
876:19,21
Wetzel (2)
723:10;725:3
what's (9)
738:13;759:23;
760:10;766:1;770:7;
777:11;782:18;842:21;
893:1
whatsoever (1)
857:17
whereby (1)
872:20
white (5)
806:13;849:6,7;
891:18,20
whittle (1)
820:1
whittling (3)
820:19,22;821:11
whittling-down (1)
821:22
whole (16)
725:22;739:7;
740:15;753:1,17;
754:19;759:1;763:17;
765:3;774:1;778:11;
779:23;817:21;831:25;
832:2;834:4
wholesale (2)
731:17;734:14
wholly (2)
800:24;837:24
who's (1)
873:10
Williams (2)
797:12;836:13
willing (1)
756:16
willingness (1)
866:18
wind (1)
811:1
winds (1)
817:16
wing (2)
876:19,21
wiring (1)
872:20
wish (1)
842:10
withdraw (1)
804:11
withdrawn (3)
759:24;765:15;
846:12
withdrew (7)
744:24;759:22;
760:1,12,25;761:22;
769:11
within (20)
731:2;735:24;
781:10,15;789:23;
801:15;825:24;833:21;
836:5;837:10;838:4;
858:10;870:25;875:12;
876:1,1;885:15;889:8;
890:21,23
without (6)
731:17;734:4;
736:20;763:15;784:6;
834:22
witness (143)
722:11;724:2;
725:19;726:15,21;
727:10;743:17;744:23;
745:15;746:15;750:4,
7,8,8;753:20;754:5,18;
758:17;774:20;775:10;
795:15;797:11;798:4,
11,12;799:7,25;800:3;
803:23;818:20;821:20;
822:9,12,15,19,23;
824:18;826:10,12,18,
23;827:4,7,11,15,25;
828:3,8,12,16,21,24;
829:5;830:3,6,10,15,
22;831:1,5,12,22,25;
832:5,10,14,23;833:4,
7,12,23;836:7;838:12;
840:10,18;841:2,25;
843:14;846:5,16;
850:9,15,24;856:5,10;
863:13,14,18;866:5;
869:23,25;870:4,17;
881:23;882:3,8,13,23,
25;883:12,15,19,23;
884:2,8,13,16,17,20;
885:1,8,15,25;886:14,
23;887:3,5,22;888:13,
14;889:25;890:11,13,
20;891:6,7,9,17,21,25;
892:6,11,13,18,23;
893:2,7,13,17,20,24;
894:2,13
witnesses (8)
724:24;726:3;795:2,
3;798:5;799:9;895:5,
10
witness's (1)
862:7
wonder (1)
749:18
wondering (1)
889:20
word (6)
755:16;776:1,22;
778:14;785:16;806:3
words (11)
724:19;728:13;
748:23;750:12;757:10;
763:9;796:4;838:2;
855:8;870:16;873:19
work (16)
731:18,18;733:23;
740:22,23;741:23;
743:21;746:11;765:8;
768:10,13;776:3;
786:5;865:4,10,13
worked (9)
731:13;749:25;
802:6;805:6;819:21;
820:8;825:25;876:17;
883:15
working (15)
728:20;765:3;768:6;
792:1;797:21;806:5,6;
809:4;818:13;875:5;
880:7;889:2,10;
891:24;894:9
works (2)
765:19;768:4
worksheet (1)
889:4
world (9)
729:4,8;730:16;
738:11,15;744:6;
761:15;768:11;804:5
worse (2)
749:5;782:23
worth (4)
784:16;820:10;
859:25;874:20
wound (1)
807:25
wow (1)
749:17
wpcom (1)
891:16
wrapped (1)
811:20
writing (3)
771:13;830:8;871:4
written (5)
731:19;772:15,20;
773:20;816:8
wrong (14)
726:13;738:19;
747:20,21;758:6;
760:23;761:22;765:17,
18;769:16;770:16;
787:8;792:18;859:21
wrote (1)
743:1
Y
year (9)
752:18,21;768:2;
769:15,18;820:9;
834:4;865:2;882:18
year-long (1)
853:23
years (19)
727:19;728:18,24;
729:3;762:8,11,12;
768:23;787:9;800:14,
15;801:3;865:16;
868:14;878:10,11,12;
884:11;889:14
yes/no (2)
778:15,16
yesterday (1)
762:4
Z
zero (6)
792:23;848:10;
857:15,16;860:6;
861:19
zone (1)
876:22
0
0001 (1)
887:15
01-00326942 (1)
888:13
0129 (1)
883:4
021270128 (1)
883:4
05 (1)
786:5
06 (1)
786:5
1
1 (5)
849:14;889:1;
892:25;893:1,12
1.25 (1)
860:12
1:00 (1)
793:3
10 (10)
737:22;762:10,12;
776:16;777:25;800:14;
846:19;862:12;882:18;
894:17
10,025 (1)
783:16
10:00 (1)
895:16
10:25 (1)
846:19
100 (1)
756:6
10-K (1)
817:24
10-q (3)
813:6,9;856:23
10-q's (1)
818:1
11 (3)
789:16,18;882:18
12 (5)
776:16;777:9;
782:16;785:5;861:11
12,000 (3)
724:21;754:21;
787:19
1232 (1)
Min-U-Script® SOUTHERN DISTRICT REPORTERS (28) wants - 1232
891:15
126 (1)
774:14
1302 (1)
723:13
131 (4)
723:1,2,7;724:15
132 (1)
723:23
133 (1)
723:24
134 (2)
862:8,12
135 (3)
724:4;862:8,12
14 (4)
776:20;777:1;
865:16;868:14
14th (1)
893:15
15 (5)
755:24;783:11;
861:11,17;881:4
1559 (3)
888:15,21,25
15th (3)
733:8,8;791:10
16,000 (2)
761:17;784:15
17 (2)
727:19;777:12
1762 (2)
723:10,13
18 (3)
776:23;777:21;801:3
1990 (1)
864:23
1991 (1)
864:23
2
2 (9)
757:24,25;776:20;
777:9;849:18;888:15,
21,24;894:8
2:00 (3)
793:3;795:12;798:16
2:15 (1)
799:2
20 (11)
729:16;755:9,10;
758:8;763:7,9,13;
784:10;859:6,16;
878:12
200 (1)
756:7
2001 (2)
849:19;850:11
2002 (1)
801:5
2004 (16)
729:6;864:8;865:15,
25;866:21,22;867:11;
869:9;871:14,24;
872:1,25;876:25;
878:7,16;879:2
2004-2005 (1)
858:3
2005 (13)
729:6;782:23;
804:18;846:19;857:24;
859:23;860:3;861:10,
18;864:17;866:21;
867:4;888:18
2005-1 (14)
781:11;783:16;
802:1,8;805:6;808:21;
809:23;812:8;814:19;
815:18;817:18,19;
818:3,5
2005-2006 (1)
801:8
2006 (14)
723:9;729:6;857:12,
17;859:23;861:13,14,
19;866:21;869:10;
877:1;878:7,16;879:2
2006-2 (11)
781:11,21,25;
782:15,19;808:15,23;
812:9;815:22;816:7,10
2007 (4)
729:6,15;812:9;
871:14
2008 (3)
812:8;892:22;893:15
2008-02-21 (2)
891:13,14
2008-02-23 (1)
892:14
2008-09-16 (1)
892:17
2008-09-22 (2)
891:4,8
2008-10-16 (1)
891:4
2008-10-22 (1)
892:25
2008-11-18 (1)
893:11
2009 (8)
781:17;782:3;783:2;
786:10;888:15,21,24;
894:8
2011 (2)
857:5;859:2
2012 (7)
752:21;757:5;813:8;
814:21;815:23;857:4;
895:16
21 (2)
777:1;891:13
22 (3)
776:20,23;777:21
23 (2)
817:7;895:16
23960 (1)
887:19
25 (3)
776:20;817:7;881:5
250104 (1)
748:20
251 (2)
785:24,25
257/lines (1)
777:9
270 (3)
789:16,17,18
279 (1)
780:7
279/line (1)
777:12
28.8 (2)
816:3,9
280 (1)
780:8
280/line (1)
777:13
288 (3)
785:4,7,8
28th (1)
723:9
292 (2)
790:17,21
2nd (1)
888:17
3
3 (2)
762:8;849:21
3,841,200 (1)
782:11
30 (5)
728:18;729:3;
814:21;815:23;878:12
30th (1)
857:4
31 (2)
848:14;859:2
31st (1)
857:5
34 (1)
783:4
35 (3)
782:17,19,21
358 (1)
781:11
37 (4)
782:12;783:3,5;
792:15
371 (1)
781:10
4
4 (1)
876:19
4:00 (1)
895:2
40 (1)
739:4
400 (16)
781:12,25;783:2;
785:12;786:9;787:12,
18;791:17,19,20,21;
792:1,8,10,11,12
45 (10)
791:14,17,19,20;
792:3,8,10,11,13,14
47 (4)
782:2,17;786:7,9
473 (2)
791:10,10
5
5 (11)
776:15;781:10,16;
789:24;790:9,17,21;
791:11;792:6;894:23;
895:1
5,000 (1)
782:21
5,112 (1)
782:20
5:00 (3)
793:24,24;797:19
50 (14)
733:13;750:3,6,9;
781:13;785:12;789:21,
22;791:8,9;795:15;
823:13;877:3;878:3
500 (2)
785:23;786:1
500485979 (2)
770:11;771:1
500529094 (2)
770:20;771:4
50s (1)
756:5
51.2 (1)
816:3
52c (3)
775:21;784:2,17
54 (3)
847:23;848:11,14
555/lines (2)
776:20;777:1
556 (2)
777:23,24
556/lines (3)
776:15,23;777:21
558/lines (1)
776:20
57 (1)
813:21
5th (1)
893:15
6
60 (4)
784:3;835:14;877:3;
878:3
600 (2)
756:22;871:9
610 (4)
733:5,15;769:15,17
613/lines (1)
776:16
620 (2)
869:16;871:8
640 (2)
871:8,8
660 (5)
869:18;870:13,13;
871:2,8
6-year-old (1)
764:21
7
7 (5)
727:3,6,8;777:13;
792:4
7:00 (3)
793:20,25;886:20
70 (2)
835:14;842:15
70,000 (1)
728:21
702 (4)
726:7,20,21;746:19
72 (1)
757:25
75 (1)
823:13
75.56 (1)
787:6
8
80 (2)
781:14;790:10
80s (1)
756:6
87.59 (1)
783:8
9
9 (2)
776:15;862:12
9.5 (1)
859:4
90 (2)
737:24;781:15
90th (4)
752:8,10;762:4,4
91 (4)
847:13;848:7;
Min-U-Script® SOUTHERN DISTRICT REPORTERS (29) 126 - 91
849:24;850:21
95 (5)
781:8;787:13;788:2;
789:24;790:8
99.9 (1)
779:22
Min-U-Script® SOUTHERN DISTRICT REPORTERS (30) 95 - 99.9

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In The Matter Of:

ASSURED GUARANTY MUNICIPAL CORP. v

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