(i.e., the borrowers of the loans are paying their mortgages as payments are due).Indeed, the vast majority of the loans in the pool at issue either is current or already has been paid off completely.2.
Wells is the trustee for the holders of Commercial Mortgage Pass-ThroughCertificates, Series 2006-MF4 (“MF4”). The MF4 certificates (“Certificates”) are bonds thatgive the holders (“Certificateholders”) rights to certain periodic payments from the MF4securitization trust, which owns several hundred small-balance
multi-family mortgage loansoriginally made by LaSalle’s Multifamily Finance Group (“MFG”). The MF4 securitizationtransaction is governed by a Mortgage Loan Purchase Agreement, dated December 20, 2006(“MF4 MLPA”) and a Pooling and Servicing Agreement, dated December 1, 2006 (“MF4PSA”).3.
In this dispute, Wells is acting by and through the special servicer for theMF4 trust, Midland Loan Services (“Midland”). Wells, acting by and through Midland, is alsoreferred to herein as “Defendant.” By letter dated September 5, 2012 (the “September DemandLetter”), Midland demanded that Bank of America repurchase by the end of the Initial CurePeriod “all loans in the MF4 securitization other than those that have been paid off as agreed”(“Loans” or “Mortgage Loans”) alleging breaches of various representations and warranties inthe MF4 MLPA that Midland claims arise from alleged “systemic flaws” in the way that MFGunderwrote the Loans.
But Defendant’s demand that Bank of America repurchase all the Loans
, and thereby rescind the MF4 securitization transaction, is not permitted by the
“Small-balance” loans are typically loans that are $1 million or less.
Under the MF4 PSA and MF4 MLPA, the Initial Cure Period is 90 days after receipt of notice of thealleged breach, which, for the “systemic flaws” claims raised in the September Demand Letter would beDecember 4, 2012. For the claims made in the supplemental letter of November 30, 2012, the end of thecure period would be February 28, 2013.
Case: 1:12-cv-09612 Document #: 1 Filed: 12/03/12 Page 2 of 45 PageID #:2