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Case 1:09-cv-01656-RMC

Document 1

Filed 08/26/2009

Page

1 of 11

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

DEUTSCHE BANK NATIONAL TRUST COMPANY 300 South Grand Avenue Suite 3950 Los Angeles, California, 90071-3175,

Civil Action No.

Plaintiff,
V.

FEDERAL DEPOSIT INSURANCE CORPORATION, in its capacity as Receiver of Washington Mutual Bank,

JURY TRIAL DEMANDED

550 17th Street, N.W. Washington, DC 20429

Defendant.

COMPLAINT

Plaintiff Deutsche Bank National Trust

Company ("DBNTC"), by

its

undersigned

counsel, alleges

as

follows:
PARTIES

1.

Plaintiff DBNTC is

national

banking association organized under the laws

of the

United States of America to carry


main office and
Los

on

the business of a limited purpose trust company. DBNTC's is located at 300 South Grand Avenue, Suite
a

principal place of business


and

3950,

Angeles, California, 90071-3175,

site of its trust administration is located at 1761 East

St. Andrew
2.

Place, Santa Ana, California, 92705,


DBNTC
serves as

trustee, document custodian, and in certain other trust-related


as

capacities (collectively,

sometimes referred to hereinafter

the

"Trustee") under the governing

agreements, custody agreements, and various subsidiary

or

related

fiduciary arrangements

Case 1:09-cv-01656-RMC

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(collectively,
serviced

the

"Governing Agreements")
its

for

over

159 Trusts

created, sponsored, and/or


and/or their affiliates under
more

by Washington Mutual Bank, (collectively, "WMB")

predecessors-in-interest,

their control
"Trusts." 3.

between 2000 and 2007, described

fully herein

as

the

The Trusts
or

currently hold,

as

trust assets or

collateral, mortgage loans that WMB

originated
4.

acquired, serviced,
The Trustee

and/or sold into the Trusts.


this action for and
on

brings

behalf of the Trusts, investors in the

Trusts and itself as Trustee.


5.

The Trusts at issue


a

are

"express trusts" created by written instruments manifesting

the express intention to create

trust and

setting forth the subject,

purpose, and beneficiaries of

the Trusts. The Trustee therefore

brings

this action pursuant to Federal Rule of Civil Procedure

17(a)(1)(E)
investors.
6.

as

the trustee of an express trust for the benefit of the Trusts and the Trusts'

Defendant Federal

Deposit

Insurance

Company ("FDIC")

is

an

agency of the

United States created


laws and

by the

Federal

Deposit

Insurance Act, 12 U.S.C.

1811 et seq. and related

regulations.

The FDIC acts, from time-to-time and among other

things,

as a

receiver

and/or conservator of banking institutions.


7.

This

Complaint

asserts claims

against the

FDIC in its

capacity as

receiver of

WMB. The term "FDIC" includes the FDIC in such

capacity.

JURISDICTION AND VENUE


8.

This action arises under the laws of the United States and is

suit

on a

claim

submitted to the FDIC pursuant to 12 U.S.C.

1821(d).

This Court has

subject

matter

jurisdiction over this

action pursuant to, inter alia, 28 U.S.C.

1331, 12 U.S.C.

1819(a),

Case 1:09-cv-01656-RMC

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1819(b)(2)(A)
pursuant

and

1821(d)(6),

and 28 U.S.C.

1367. Jurisdiction also exists in this Court


a

to 28 U.S.C.

1349 because the FDIC is


owns more

corporation incorporated by an Act


half of its
to 12

of

Conp-ess
9.

and the United States

than

one

capital

stock. which

Venue is proper in this Court


on a

pursuant

U.S.C.

1821(d)(6),

authorizes suit

claim submitted to the FDIC to be

brought

in this district.

BACKGROUND
A.

Proof of Claim
10.

On December 30,
on

2008, the Trustee timely filed with the FDIC

as

receiver for

WMB

proof of claim

behalf of the Trusts and the Trustee pursuant to 12 U.S.C.

1821(d)

(together with
FDIC under
or

all exhibits thereto, the "Proof of Claim"),


related to the

outlining various

claims

against the

Governing Agreements.

A copy of the Proof of Claim is attached

hereto
in this

as

Exhibit 1. Exhibits A-1, A-2, and A-3 to the Proof of Claim


and
on

identify the

Trusts at issue

case

whose behalf this action is

brought.
if set forth here in full the

11.

The Trustee

hereby incorporates by reference as


along
causes

entirety of its
and

Proof of Claim,

with the exhibits thereto and materials referenced therein


of action
or

hereby

asserts all

claims,

rights

to

relief that

are

included in

or

arise from

the Proof of Claim


12. Trusts filed

or

the facts referenced therein.

On information and

belief, other parties with interests in

or

obligations

to

the

proofs of claim

with the FDIC,

including

securities

underwriters, depositors, loan


may be

servicers, insurers and investors. The claims asserted in these other proofs of claim
related
Trustee
or

supplemental

to

the claims asserted

by the

Trustee and the Trusts in this action. The

hereby incorporates by reference

any such

proofs

of claims,

along with

the exhibits

thereto and any materials referenced therein to the extent

appropriate

and/or necessary.

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11

13.

In its Proof of Claim, among other

things,

the Trustee identified the failure of ide


access

WMB, in contravention of the Governing Agreements,


and to

to pro\

to

books and

records,

properly notify the


were

Trustee of the

ongoing multiple breaches

of representations and

warranties that
14.

concealed from the Trustee.

In its Proof of Claim, the Trustee further reserved its

rights
was

to amend

or

supplement
waive
or

its Proof of Claim and made clear that its Proof of Claim
or

in

no

way intended to

release any claim it

the Trusts may have.

15.

Pursuant to 12 U.S.C.
or

1821(d)(5)(A)(i),

the FDIC should have determined

whether to allow
2008. 16. 17.

disallow the Trustee's Proof of Claim within 180

days

of December 30,

The FDIC has failed to


Pursuant to 12 U.S.C.

respond

to

the Proof of Claim. the FDIC's failure to


on

1821(d)(6)(A)(i),
right
to

respond timely to
or

the Proof of Claim tritwered the Trustee's

"file suit

such claim in the district

territorial court of the United States for the district within which the

depository institution's

principal place
Columbia

of business is located

or

the United States District Court for the District of

(and

such court shall have jurisdiction to hear such this Court.

claim)" within

60

days

thereafter.

This action is
18.
or

timely and appropriately brought in


The Trustee may amend this

Complaint
to do
so

if new and different facts become known

available, and expressly reserves the right

in the event that the FDIC attempts to

address its failure to


B.

timely determine the

Proof of Claim.

WMB and Its Successors 19.

Until

September 25, 2008,

WMB

was an

FDIC-insured federal

savings

bank

chartered and

regulated by the

Office of Thrift

Supervision (the "OTS").

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20.

On

September 25, 2008, appointed


the FDIC

the Director of the


WMB's receiver.
on

OTS, by Order Number 2008-36,

closed WMB and


21.

as

On information and

belief,

September 25, 2008, a purchase


was

and

assumption

agreement (the "Purchase and Assumption Agreement")


FDIC
as

entered into
and

by and

among: the

receiver of WMB; the FDIC in its corporate

capacity;

JPMorgan

Chase

Bank,

National Association
22.

("JPMC")

The Purchase and

Assumption Agreement provides

that

JPMC,

as

"Assuming

Bank" and agrees to pay, perform, and discharge, all of the liabilities of expressly assumes the Failed Bank which are reflected on the Books and Records of the Failed Bank as of Bank Closing, including the Assumed Deposits and all liabilities associated with any and all employee benefit plans, except as listed on the attached Schedule 2.1, and as otherwise provided in this Agreement (such liabilities referred to as 'Liabilities Assumed'). Notwithstanding Section 4.8, the Assuming Bank specifically assumes all mortgage servicing rights and obligations of the Failed Bank. 23.
At the present

time, based

on

the Purchase and

Assumption Agreement,

and

on

information and belief, the Trustee believes that JPMC has assumed the liabilities related to the

Governing Agreements

and the Trusts. The Trustee further believes that the FDIC has not

split

the assets from the liabilities. On that

basis, the Trustee has

not

brought claims

that it may

otherwise have if the FDIC transferred the assets and benefits of the Trusts without the associated liabilities. If the Trustee learns additional information

transferring
the FDIC
this

suggesting that
the

did transfer assets without the associated liabilities, the Trustee

reserves

right to amend

Complaint to bring additional capacities.


C.

claims

against the FDIC

as

receiver of WMB and/or in other

The Securitization Trusts and the Governing Agreements

24.

In the

Governing Agreements

for the Trusts, WMB made

numerous

representations,

warranties and covenants

regarding the

due execution and

enforceability

of those

Case 1:09-cv-01656-RMC

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agreements and regarding the characteristics of the underlying mortgage loans (the

"Representations
25.

and

Warranties")
an

The
on

Governing Agreements represent

integated

set of contractual

undertakings
26. 27.

behalf of WMB with respect to the foi mation and

servicing

of the Trusts.

Each

Governing Agreement

is

unitary

contract

that is not divisible.

The
a.

Governing Agreements:
are

all in

writing;

b.

were

all executed

by WMB

and DBNTC,

as

Trustee,

at

the time the

associated property interests transferred;


c. were

executed

on

behalf of WMB

by individuals duly

authorized

by the

WMB Board of Directors; and

d.

have been

continuously

in

existence, since the time of execution, and

constitute official records of WMB. BREACHES AND DAMAGES


A.

WMB's Breaches of the Representations and Warranties 28. Pursuant to the

Governing Agreements,

WMB had express contractual

obligations

to:

a.

notify certain parties


aware

to

the

Governing Agreements, including the Trustee,


Warranties;

when WMB became

of breaches of Representations and


cure

b.
c.

make certain

payments; and/or
a

repurchase
to

the mortgage loan at

price specified

in the

Governing
loan(s) plus

Agreements (typically equal


accrued interest

the

unpaid principal balance

of the related mortgage

through the

date of repurchase).

Case 1:09-cv-01656-RMC

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29. 30.

WMB breached the WMB also failed to

Representations

and Warranties. of all of the breaches of

notify appropriate parties


cure

Representations
loans at the
31.

and

Warranties, make

payments, and repurchase all of the related mortgage

appropriate price.
The breaches of Representations and Warranties have not, to the present date,
or

been cured
32.

otherwise remedied in accordance with the


In

Governing Agreements.

addition, despite provisions of the Governing Ageements permitting the

Trustee and certain other

parties

in interest to the Trusts to have

access

to WMB's books and


to

records

concerning mortgage
information and
a

loans in the such other

Trusts, WMB consistently refused

allow the Trustee those books

and,

on

belief,

parties

in interest to the

Trusts,

access to

and records. As

result, although the Trustee believes that there are other breaches of

Representations
unremedied,
33.

and Warranties that occurred before WMB's failure that remain uncured and

that infoimation has been concealed from the Trustee.


WMB failed to

comply

with its

obligation

to

notify the

Trustee of breaches of
aware

Representations

and Warranties. The Trustee is therefore not

currently

of all of the

breaches that have occurred.


34.

On information and

belief, the breaches of Representations and Warranties

more

fully described herein


approximate
B.
amount

and in the Proof of Claim have

damaged the

Trusts and the Trustee in the

of $6 billion to $10 billion

or more.

Servicing Deficiencies
35.
WMB

generally

served

as

-servicer"

or

"master servicer" with

respect

to

the

mortgage loans held by the Trusts.

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36.

As servicer

or

master

servicer, WMB

was

obligated

to

notify the

Trustee and

other

parties

in interest to the Trusts of breaches of Representations and Warranties of which it

had

knowledge.
37.
On infoimation and

belief, WMB did

not

notify

the Trustee

or

other

parties

in

interest to the Trusts of such breaches of which it had C.

knowledge.

Indemnification for Expenses


38. As
a

result of the breaches of Representations and Warranties set forth herein and

other breaches

by WMB,
and

the Trustee and the Trusts have incurred, and will continue to incur,
expenses

significant

costs

legal

enforcing mortgage

loan

rights

and documents and

defending against claims,


not limited

counterclaims and third party claims. These expenses


or

include, but

are

to, attorneys' fees and costs, and the related actual

potential liability

for the claims.

These claims

include, but

are

not limited

to, claims made in civil litigation


or

proceedings against
Trustee and/or the

the Trustee and/or the Trusts, and other lawsuits filed


Trusts

threatened

against the

relating to WMB
39.

and its

origination

and/or
or

servicing

of mortgage loans.

Such

third-party claims

involve

relate to the acts and omissions of WMB and and

its

predecessors
40.

in connection with the

origination

servicing of mortgage loans


and

in the Trusts.

Pursuant to the

Governing Agreements

applicable law,

WMB

was

obligated

to

indemnify the Trustee and the Trusts


41.

for these amounts.


core

Such indemnification constituted and agreement to act


Trusts.
as

consideration both for the Trustee's initial

and

ongoing obligation by the

Trustee and for the investors'

purchase

of

securities issued
42.

WMB failed to

comply fully

with its indemnification

obligations

to

the Trustee.

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CLAIM FOR RELIEF Count I

Breach of Contract (Against FDIC as Receiver of WMB) 43. this

The Trustee
as

incorporates by reference the previous


set

and

succeeding paragaphs

of

Complaint
44.

if they

were

forth here in full. above and in the Proof of Claim constitutes


of the

The conduct

alleged

multiple

breaches of contract
45.

by WMB, including breaches

Governing Agreements.
WMB breached the

Without

limiting the generality of the foregoing,

Governing

Agreements because:
a.

mortgage loans in the Trusts did

not meet

the standards articulated in the

Representations
b.
WMB failed to

and

Warranties;
Trustee of the existence of breaches of

notify the
and

Representations
c.

Warranties;

WMB failed to make


WMB failed to

required

cure

payments;
loans that did not

d.

repurchase the mortgage

comply

with

WMB's
e.

Representations

and Warranties; and its

WMB failed to
a

comply with
cause

indemnity obligations.

46.

As

direct and

proximate

of WMB's breaches of contract, the Trusts and

the Trustee have suffered


47.

significant damages.

The Trustee is
or

fully performing

and has not breached its and its

obligations

under the

Governing Agreements

excused the

performance by WMB

successors

of their

obligations
48.

thereunder.
The FDIC
as

the receiver of WMB is the

successor

in interest to WMB.

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49. in their

As

successor

in interest to

WMB, the FDIC

was

required by law either

to assume

entirety WMEr s obligations


Governing

under the

Governing Agreements,
to

if it wished to obtain the


to

benefits of the

A Ezreements

by transferring them

jPMC,

or

repudiate

the

Governing Agreements
50.

in their

entirety.
assume

Having

elected to

WMB's

obligations under the Governing Agreements


the FDIC
was

in order to

gain the benefits


in their

of the

Governing Agreements,
to

bound

by those
to

obligations

entirety and was required


cure

perform them, including the obligations repurchase


any affected

notify

the Trustee of breaches and to condition to


51. 52. 53.
cure

them and/or

mortgage loans

as a

transferring WMB's obligations


The FDIC failed to
cure

and assets to JPMC.

WMB's breaches of the

Governing Agreements.

As receiver of WMB, the FDIC is liable for WMB's breaches of contract. In

addition, the
or

FDIC's breaches of the

Governing Agreements,

and its failure to

WMB's breaches

to cure such

breaches in accordance with the

Governing Agreements,

constitute breaches of contract and

wrongful

conduct in its administration of the WMB

receivership.
54.

The FDIC's conduct


to
an

gives

rise to

priority right

of payment that is

superior

or

equivalent

administrative claim under the

preference

scheme outlined in 12 U.S.C.

1821(d)(11).
55,

The Trusts and the Trustee of contract, which


are

are

entitled to

an

award of damages caused


at

by WMB's
or

pre-failure breaches
more.

currently estimated

$6 billion to $10 billion

10

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56.
as an

The Trusts and the Trustee

are

entitled to

recover

these

damages
WMB's

either in full

or

administrative

priority claim

in

light

of the FDIC's failure to

cure

pre-failure

breaches of contract.

WHEREFORE, the Trusts and the Trustee demand judgment in their favor against the
FDIC
costs
as

receiver of WMB, in

an

amount to be

determined, plus

pre- and

post-judgment interest,

of suit,

attorneys' fees, and

such other relief to which

they may be entitled.

JURY TRIAL DEMAND 57.

Plaintiff DBNTC
or

hereby demands a jury


law.

trial to the fullest extent allowed

by the

Constitution

other

applicable

Dated:

August 26,

2009

By:
Patrick D. Conner (D.C. Bar No. 472298)(renewal pending) Janice L. Kopec (D.C. Bar Number 976520) MORGAN, LEWIS & BOCKIUS LLP 1111 Pennsylvania Avenue, NW Washington, DC 20004 Telephone: 202-739-3000 Facsimile: 202-739-3001
Jami Wintz McKeon (seeking admission pro hac vice) Gregory T. Parks (seeking admission pro hac vice)

MORGAN, LEWIS

& BOCKIUS LLP

1701 Market Street Philadelphia, PA 19103

Telephone:
Facsimile:

215-963-5000 215-963-5001

Attorneys for Plaintiff Deutsche Bank National Trust

Company

Case 1:09-cv-01656-RMC

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EXHIBIT 1

Case 1:09-cv-01656-RMC
& Bockius LLP 1717 Main Street, Suite 3200 Dallas, TX 75201 7347

Document 1-2

Filed 08/26/2009

Page

2 of 25

Morgan, Lewis

Nlorgan Levvis
COUNSELORS
AT

Tel: 214.466.4000 Fax: 214.466.4001

LAW

www.morganfewis.com

Ann Marie Painter


Partner 214.466.4121

annmarie.painterCMorganLewis.corn

December 30, 2008 BY HAND DELIVERY Federal Deposit Insurance 1601 Bryan Street

Corporation

Dallas, Texas 75201


Re:

Deutsche Bank National Trust


or

Company

Proof of Claim

Dear Sir

Madam:

Enclosed please find a Proof of Claim, which is hereby submitted on behalf of Deutsche Bank National Trust Company. If you have any questions, please do not hesitate to contact me di rectl y.

Sincerely,

111(A4 kYi
Arm Marie Painter

Pat-ytiW'

AMP/ph
Enclosures
cc:

John Rosenthal

Kristine

Bailey

Morgan Lewis, San Francisco Morgan Lewis, San Francisco

DB1/62194206 2

Case 1:09-cv-01656-RMC

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Federal Deposit Insurance Corporation Washington Mutual Bank


(Name of Bank/Financial In5titution
and

as

Receiver for:

Location)

PROOF OF CLAIM

CONFIDENTIAL TREATMENT REQUESTED


Bank Natiomi Trust Attachment A contains confidential, non-public financial information, Claimant Deutsche informaion contained in Attachment A, and the non-public documents Company requests that the claim, the attached hereto be considered and treated as confidential

SSN/Tax ID The

(1)

33-0943418 Barbara

undersigned, (2)

Campbell,

Vice President
now in

says that the

Washington Mutual Bank

liquidation

is

justly (4)
C
A 1

indebted to

(3)

Institution) (Name Deutsche Bank National Trust Corn *an


of Bank/Finandal
a

in the sum of

$18, 145 399, 660

(Individual/Jolnt/Corporation/PartnershipTirm/AgenoY) Dollars upon the following Claim: ..roximatel, see Attachment A


Liabili
Number

Descriiiti6n of
(5)

invoice claim: See Exhibit A

Amount of Claim

$6, 764,266, 440 to $10, 146,399, 660 approx., (see Attachment A).
Total

C6'im: (6)

Approximately
$10,146, 399, 660 (see

The

undersigned

further states that he/she makes this Claim on behalf of Trust Colpy_ow1_

(7)

Deutsche
no

that

part of said debt has been paid, that


(lndividual/Joint/Corporation/Partnership/FirmAgency) assignment of the same or any part thereof, and that there is

(8)
has

Deutsche Bank National Trust Corn an

given

no

endorsement
or

or

no

set-off or

counterclaim,

other

legal

or

equitable

defense to said Claim

or

any part thereof.


Vice President

NAME

(9)

Barbara

Campbell

(Signature of Person making


the

(Title)

Claim)

Deutsche Bank National Trust Company (If applicable) ADDRESS (10) 1761 East St Andrew PI FIRM CITY/STATE/ZIP Santa Ana CA 92705-4934
714-247-6278

TELEPHONE NUMBER

Or thing The penalty for knowingly making or inviting reliance of any false, forged, or counterfeit statement, document, is a fine of not more for the purpose of influencing in any way the action of the Federal Deposit Insurance Corporation than $1,000, 000 or imprisonment for not more than thirty years, or both (18 U.S.C. Section 1007).

RLS7212

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CONFIDENTIAL TREATMENT REQUESTED

ATTACHMENT A
to

Proof of Claim of DEUTSCHE BANK NATIONAL TRUST COMPANY, AS TRUSTEE AND CUSTODIAN

A. CAPAC111ES AND DOCUMENI 1 S.

proof of claim ("Proof Company ("DBNTC") (a) as

This

Claim") is made by Deutsche Bank National Trust ("Trustee") for the securitization trusts listed on Exhibit A-I attached hereto (the "Trusts"), on behalf of itself, the Trusts and the owners of certain residential mortgaged backed securities issued by the Trusts (the "Securities"), (b) as trustee of certaM "net Mterest margin" trusts fisted on I xhibit A-2 ("NIM Trusts", and collectively with the Trusts, the "Securitization Trusts") pursuant
trustee

of

which DBNTC owns, on behalf of NIM Trust beneficiaries, interests in certain Securities (the "NIM Trustee") and (c) as custodian (the "Custodian") under certain custody agreements listed on Exhibit A-3 (the "Custody Agreements") by and among DBNTC, and one or more of Washington Mutual Bank (in some cases, as successorin-interest to Long Beach Mortgage) and/or its affiliates (collectively, "WAMU"), and/or third party lenders or purchasers of mortgage loans.
to

2.

Each of the Trusts holds, and/or sold into the Trusts

as

by

Trust assets WAMU.

or

collateral, mortgage loans

originated by

3.

With respect to each Trust, DBNTC entered into one or more Pooling and Servicing Agreements, Servicing Agreements, Indentures or Trust Agreements, and related ancillary agreements (collectively, the "Governing Documents"). The Governing Documents are voluminous and are in the possession of both the Trustee and WAMU. Accordingly, it is impractical and wasteful to attach them to this Proof of Claim. Additional documentation regarding the Trusts is available on the SEC's EDGAR website at http://sec.gov/, and the monthly distribution reports and prospectus supplements for each Trust are available on the Trustee's investor reporting website at https://tss.sfs.db.com/investpublic/. Upon request by the FDIC, the Trustee will furnish electronic or hard copies of any Governing Documents in its possession.

4.

Trust, WAMU sold, either directly or indirectly, mortgage loans into the related Trusts. In connection with such sales,

Pursuant to the
WAMU

Governing

Documents for each

numerous made representations, warranties and covenants ("Representations and Warranties") concerning the mortgage loans, which Representations and Warranties were ultimately assigned to the Trusts pursuant the Governing Documents and certain ancillary agreements. The Trusts have claims for breach of such Representations and Warranties as further described herein.

also

5.

Custodian under the Custody Agreements. Pursuant to the Custody Agreements, DBNTC has held in custody mortgage loan files evidencing mortgage loans originated, purchased, financed and/or serviced by WAMU. In
as

DBNTC has also served

10701777.6

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certain Custody Agreements. the Custodian held and disbursed funds with respect to the funding and/or financing of such mortgage loans in accordance with instructions furnished to the Custodian by WAMt I, loan purchasers or lenders. 'Flie Custody Agreements are voluminous and are in the possession of both the Trustee and WAMl). Accordingly. it is impractical mid unnecessary to attach them to this Proof of Claim. Upon request by the FDIC, the Trustee will furnish electronic or hard copies of any Custody Agreements in its possession.
to

addition, pursuant

6.

DBNTC is aware that certain other parties to the 'Frusts, including, without limitation, securities underwriters, depositors, loan servicers, insurers and investors, intend to file proofs of claim in these proceedings relating to the Governing Documents and ancillary agreements which may be duplicative of, or supplemental to, the claims stated herein (the -Thi rd Party Trust Related Claims"). To the extent that such fhird Party "frust .Related Claims relate to or are property of the l'rusts, DliNTIC incorporates such 'fhird Party Trust Related Claims herein by reference.

B. DESCRIP I ION OF, CLMIVIS.

Claims Arising from Breach of Representations and Warranties (Estimated Range: $6.764 billion to $10.146 bilhon)
7. Pursuant to the Governing Documents, WAMU, as seller and [Master" servicer, made certain Representations and Warranties in connection with the sale of the mortgage

loans to the Trusts. WAMU has breached certain of these Representations and Warranties. Pursuant to the Governing 1-.)ocuments, WAMU has express contractual obligations (i) to notify certain parties to the Governing Documents, including the Trustee, when WAMU becomes aware of breaches of Representations and Warranties, (ii) to make certain cure payments with respect to certain such breaches or (iii) to repurchase the mortgage loans affected by WAMU's breaches, at the repurchase price

(the "Repurchase Price") specified in the Governing Documents (typically equal to the unpaid principal balance of such mortgage loans, plus accrued interest thereon through the date of repurchase) (the "Repurchase Obligations"). Further, as described below, WAMU is liable to the Trustee and the Trusts for all liability, loss, cost and expense arising from breaches of Representations and Warranties, including all costs and expenses of enforcement of these obligations.
8.

the public statements of the FDIC, it is unclear to the Trustee which obligations under the Governing Documents the FDIC purports to have assumed and assigned to JPMorgan Chase Bank, National Association ("JPMC"). Moreover, the FDIC has not notified the Trustee whether it intends to repudiate any obligations of WAMU under the Governing Documents, many of which obligations are executory in nature. The Trustee asserts that the FDIC does not have the power, with respect to the Governing Documents for any particular Trust, to "cherry pick" valuable contractual rights of WAMU, such as servicing rights, while repudiating potentially burdensome obligations of WAMU, such as Repurchase Obligations under those same contracts. Rather, if the FDIC wishes to reap the benefits of these contracts (by receiving the purchase price paid by JPMC for WAMU's assets), it must also accept their burdens. Accordingly, to the extent that the FDIC purports to have assumed and assigned to JPMC any rights and benefits of WAMU to service Mortgage Loans under the
on

Based

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Governing
regard,
Beach

Documents for any Trust, the FDIC must make provision to perfOrm fully all of WAM1I's obligations under the Governing Documents for that Trust. In this

single entity Washington Mutual Bank (Ika Long Mortgage Company)-- generally entered into the Governing Documents both as seller and as [master] servicer. In addition, the Governing Documents represent an integrated set. of contractual undertakings on behalf of WAMU with respect to the fonnation and servicing of the Trusts and WAMU (or its successors and assigns) cannot selectively assume the benefits of these undertakings while repudiating the related burdens. To the extent that WAMU has either (a) failedin its capacities as seller or servicer-- to notifY the Trustee and other transaction parties of material breaches of Representations and Warranties of which it was aware, and/or (h) repudiates and fails to perform its obligations to replace or repurchase defective loans, the Trusts have claims for breach of such obligations (the "Repurchase Claims"). Moreover, even if the FDIC did have the power to repudiate certain obligations of WAMU to the Trusts while assuming and assigning other obligations, the Trusts would have a right of set-off against any and all amounts owing to WAMU under the Governing Documents (including the right to recover servicing advances) with respect to any and all damages arising from the breach of such repudiated obligations.
a

the Trustee notes that

9.

September 28, 2008, the Trusts held in excess of $49.9 billion in current principal balance outstanding of mortgage loans sold to the Trusts by WA.MU. Recent media reports allege certain abuses in WAMU's loan origination procedures which, if true, would constitute breaches of the Representations and Warranties. (see e.g. attached NY Times article dated as of December 27, 2008). Notwithstanding of the Governing Documents permitting the Trustee and certain other provisions parties access to WAMU's books and records concerning the mortgage loans, the Trustee is informed and believes that during the last 18 months, WAMU has consistently refused to allow the Trustee, bond insurers, and investors with an interest in the Trusts to perform any meaningful due diligence to determine whether Representations and Warranties were breached. Since WAMU's denial of counterparties' contractual inspection rights has deprived those parties of the ability to detect and quantify specific breaches of Representations and Warranties, claimants must be given reasonable access and time to investigate their claims prior to specifying them with greater particularity. Nevertheless, on the basis of the limited data currently
As of

available to the Trustee, the Trustee further describes these claims below.
10. for purposes of this Proof of Claim, that WAMU has and will continue to breach its obligations with respect to Repurchase Claims, the damages flowing from such breaches will vary depending on the losses suffered by the Trusts in respect of the related mortgage loans. Certain of the properties underlying the mortgage loans subject to Repurchase Claims either (a) have been foreclosed upon and are owned by the frusts as of the date of this Proof of Claim (the "REO Loans") or (b) are owned by

Assuming,

The dollar amount of any the Mortgagors (the "Mortgagor-Owned Loans"). Claims related to REO Loans and Mortgagor-Owned Loans will be Repurchase affected by the value of those loans and their underlying collateral because the damages suffered by the Trusts as a result of WAMU's breach will be partially offset by the value of the collateral retained by the Trusts. Due to the ever-changing nature of market forces impacting the value of REO Loans and Mortgagor-Owned Loans, the amount due to the Trusts on account of the REO Loans and Mortgagor-Owned Loans
10701777.6

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remains in flux. Until the amount of WAMU's exposure on REO Loans and Mortgagor-Owned Loans is finally determined, the Trusts' corresponding claim remains unliquidated and may decrease or increase as a result of fluctuations in the valuation of the underlying property and related loans, and payments of principal and interest either made or not made by the mortgagor of the underlying loans. Certain of the properties underlying the mortgage loans subject to Repurchase Claims have been foreclosed upon and in turn sold ("REO Sold Loans"). The sale prices of the the REO Sold I, oans will be a partial oft'set to the Repurchase properties underlying Price related to such REO Sold Loans.
11. On information and belief, taking into account (a) industry information regarding frequency of breaches of representations and warranties in portfolios of mortgage loans similar to those sold by WAMU to the Trusts, (b) the performance of the mortgage loans held by the Trusts and (c) the severity of losses experienced by the Trusts to date and anticipated in the future, the Trustee estimates that the 'Frusts have claims in respect to breaches of Representations and Warranties, in the estimated range of $6.764 billion to $10.146 billion.

12.

Although Representations and Warranties were breached at the time that they were made, certain of the Repurchase Claims of the Trusts are unmatured, unliquidated and/or contingent in nature because, although breaches of Representation and Warranties exist for certain mortgage loans, such breaches have not been (a) discovered and/or (b) asserted, and/or (c) otherwise given rise to claims for the Repurchase Price as of the date hereof. The actual Repurchase Claims relating to such loans would be increased by accrued interest thereon and the Trusts' cost of enforcement, and be partially offset by the value of mortgage loan collateral and mortgage payments retained by the Trusts by reason of WAMU's failure to repurchase
such loans.

13.

foregoing, under the Governing Documents, WAMU is also subject Claims with respect to missing or defective documents in mortgage loan Repurchase tiles. The Governing Documents generally provide that if a material defect in any Mortgage File is discovered which may materially and adversely affect the value of the related Mortgage Loan, or the interests of the Trustee (as pledgee of the Mortgage Loans). the Noteholders or the Certificateholders in such Mortgage Loan, then the responsible party shall cure such defect, repurchase the related Mortgage Loan at the purchase price or substitute a qualified substitute mortgage loan for the related Mortgage Loan upon the same terms and conditions set forth for breaches of representations and warranties as to the Mortgage.
to

In addition to the

14.

The Trustee or other document custodian has furnished WAMU, on an ongoing basis, document exception reports with respect to missing or defective loan file documents. The Exceptions Reports are voluminous and are in the possession of both the Trustee and WAMU. Accordingly it is impractical and wasteful to attach them to this Proof of Claim. Upon request by the FDIC, the Trustee will furnish electronic or hard copies of any Exceptions Reports in its possession. If WAMU repudiates or fails to satisfy its obligations under the Governing Documents, the Trustee will require additional time to assess the materiality of the remaining missing defective documents and to calculate the amount of any Repurchase Claims with respect thereto. For purposes of this Proof of Claim, however, the Trustee asserts that all loans with missing or defective loan file

10701777 6

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documents are subject. to Repurchase Claims for the Repurchase Price. 'Ihe Trustee is not in a position to calculate the amount of such Repurchase Price until the population of such loans and the materiality of any document exceptions are finally determined (since borrowers continue to pay interest on some of these loans and, in many cases, other recoveries continue to he made on collateral securing such loans).
Indemnification Claims

15.

The Trusts have been damaged by virtue of WAM U's defaults and breaches with respect to the Representations and Warranties under the Governing Documents and ancillary agreements. Without limiting the generality of the foregoing, the Trusts have incurred, and will continue to incur, significant legal expenses enforcing mortgage loan documents and defending against borrower counterclaims and third party claims arising from breaches or alleged breaches of Representations and Warranties or of other obligations of WAMU (including loan servicing obligations) under the Governing Documents.

16.

Without limiting the generality of the foregoing. WAMU is obligated to defend and hold the "frusts and the 'frustee harmless all liability, loss, cost arising from the claims asserted in the following litigation matters:

indemnify,
or

expense

(a) Elaine Trahan vs. Long Beach Mortgage Company et al, pending in the United District Court, Eastern District of Texas. A putative class action seeking to invalidate certain variable rate mortgage loans under Texas law.

(b)

Jenkins vs. Deutsche Bank ct al, actions brought in the United States District Count for the Eastern District of New York and the Southern District of Florida alleging inappropriate foreclosure and debt collection activity.

(c) Suits and other proceedings against the Trusts and/or the Trustee by the cities of Buffalo, NY, Cleveland, OH, and other jurisdictions claiming that REO properties owned by the Trusts have not been maintained in accordance with law and constitute a nuisance. In addition, the Trusts and/or the Trustee have been forced to address similar allegations. Such property maintenance is the sole obligation of WAMU, as loan servicer, with respect to certain of the properties at issue in these matters. The affected Trusts and the Trustee are entitled to indemnification by WAMU, its successors and assigns, against any liability, loss, cost or expense suffered in connection with such
matters.

(d) Suits or counterclaims (typically asserted in the context of foreclosure proceedings) alleging breaches, inter alia, of the Truth in Lending Act, Fair Debt Collection Practices Act and other laws, in connection with the origination and/or servicing of WAMU-originated mortgage loans currently owned by Trusts. Because WAMU, as 'master] servicer has handled all such litigation on behalf of the Trusts and the 'trustee, the Trustee is currently unaware of the existence or nature of all such claims and reserves the right to amend this Proof of Claim to specify such matters at a later date. The affected Trusts and the Trustee are entitled to indemnification by WAMU, its successors and assigns, against any liability, loss, cost or expense suffered
in connection with such matters.

10701777 6

Case 1:09-cv-01656-RMC

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17.

the Governing Documents and applicable law, WAMU is liable to the Trusts and the Trustee for any losses, claims, expenses or damages, including legal fees and related costs, arising out of or based upon any breaches of any representation, warranty or covenant made by WAMU or any affiliate of WAMU in the Governing Documents. Such liability arises both from WAMU's breach of its contractual obligation to the 'Trusts and the Trustee to perform all of its obligations under the Governing Documents and from WAMU's obligation to indemnify, defend and hold the Trusts and the Trustee harmless from any liability, loss, cost or expense arising from WAMU's failure to perform such obligations. Moreover, even if the FDIC, as receiver for WAM1.), were entitled to assume and assign certain obligations of WAMU while repudiating others, the Trustee and the Trusts would have a right of set-off with respect to breach claims for any repudiated obligations, against any and all amounts owing by the Trusts to WAMU (including the right to recover servicing advances) in any capacity under the Governing Documents. To the extent that WAMU (a) assumes, or assumes and assigns, any of its rights under the Governing Documents, and (b) indemnifies, or causes its successor-in-interest to indemnify, the Trusts and the Trustee for such matters, such indemnification obligation will have been satisfied. Although, to date, the Trustee is informed and believes that IPMC has performed certain of such obligations, neither IPMC nor the FDIC, as receive of WAMU, has made a clear statement to the Trustee specifying which obligations of WAMU have been assumed by JPMC and which, if any, obligations have not been so assumed, but rather assumed or rejected by the FDIC as receiver of WAMU. Accordingly, for purposes of this Proof of Claim, the Trustee assumes such obligations may not be fully satisfied.
Pursuant
to

18.

Based

upon

the

foregoing,

indemnification for, legal fees and related costs,

the Trustee asserts a claim against WAMU for inter alia, all losses, claims, expenses and damages, including
or

representation, warranty
Documents.

of or based upon any breaches of any covenant made by WAMU under the Governing

arising

out

Servicing Claims
19.

above, WAMU generally served as "servicer" or "master servicer" with the mortgage loans held by the Trusts. The Trustee is informed and believes respect that JPMC intended to assume, at a minimum, all of WAMU's loan servicing rights and obligations. To the extent that JPMC, as successor-in-interest to WAMU, as [master] servicer, performs all obligations of WAMU, as !master] servicer, under the Governing Documents (including by curing any breaches that have occurred), WAMU will have mitigated claims with respect to WAMU's servicing of the loans. The Trustee reserves the right to amend this Proof of Claim to specify further any servicing claims in the event that such assumption has not taken place.
As stated
to
as

Claims 20.

N1M Trustee

As NIM

Trustee, the Trustee is the legal owner, for the benefit of securities holders under the NIM Trusts, of Securities issued by the Trusts. Since the NIM Trusts were formed concurrently and in conjunction with the corresponding Trusts, the NIM
Trustee
was

the

original purchaser of such

Securities.

10701777 6

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21.

purchaser of the such Securities on behalf of the N1M Trusts, the NIM Trustee hereby alleges that, to the extent that WAMU knew or should have known of the breaches of Representations and Warranties described above, the NIM 'Trusts have a claim for common law fraud and/or negligent misrepresentation and/or violation of applicable federal and state securities laws in connection with the issuance, distribution and sale of the such Securities to the NIM Trusts. Such claim is unliquidated and partially immatured, but would be measured by the impact, if any, of such breaches on
cash flows
to

As

the N EM Trusts.

Claims
22.

as

Custodian

Custody Agreements, DBNTC is entitled to be paid certain fees stipulated therein, plus expenses incurred in connection with its serving as Custodian. In addition, where WAMU is seller/servicer under the Custody Agreement, WAMU has agreed to indemnify, defend and hold the Custodian harmless against all liabilities, loss, cost and expense incurred by the Custodian in the performance of its duties as Custodian. The Custodian reserves the right to amend this Proof of Claim to specify fUrther any claims relating to any fees or expenses are incurred and remain outstanding in connection with the Custody Agreements,

Pursuant to the

C. MISCELLANEOUS

23.

By executing and filing this Proof of Claim, DBNTC does not waive any right to any security or any other right or rights with respect to any claim that DBNTC has or may have against WAMU or any other person or persons. The filing of this Proof of Claim
is not intended and should not be construed to be an election of remedies or waiver of any past, present or future Defaults or Events of Default under the Governing Documents and ancillary agreements.

24.

To the

knowledge

of the
no

counterclaim, and

signatory hereto, the claims are not subject to any setoff or judgment has been rendered on the claims. The amount of all
the date

payments made prior


25. DBNTC
reserves

to

hereof, if any, have been credited and deducted.

its right to amend and/or supplement this Proof of Claim and to and all other claims of whatever kind or nature that it has, or may have, that assert any come to DBNTC's attention or arise after the filing of this Proof of Claim. The filing of this Proof of Claim shall not be deemed a waiver of any such claims or rights.

26.

Nothing

contained in this Proof of Claim shall be deemed

or

construed

as:

(a)

waiver

of, or other limitation on, any rights or remedies of DBNTC or the Securitization Trusts, or any predecessor in interest to DBNTC or the Securitization Trusts, under the Governing Documents or ancillary agreements, at law, or in equity (including any setoff rights, lien rights, rights of recoupment, or any other rights that the Trustee or
or any other entity), all of which rights are DBNTC or the Securitization Trusts, or any expressly reserved; (b) by predecessor in interest to DBNTC or the Securitization Trusts, to the jurisdiction of any court with respect to proceedings, if any, commenced in any action against, or otherwise involving DBNTC or the Securitization Trusts, or any predecessor in interest to DBNTC or the Securitization Trusts; (c) a waiver or release of, or any limitation on DBNTC's or the Securitization Trusts', or any predecessor in interest to DBNTC's or

each Trust has

or

may have
a

against

WAMU

consent

10701777.6

Case 1:09-cv-01656-RMC

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the Securitization Trusts', right to trial by jury in the Court or any other court in any proceeding; (d) a waiver or release of, or any other limitation on. DBNTC's or the Securitization 'Frusts', or any predecessor in interest to DBNTC or the Securitization Trusts', rights to have any orders entered only after de novo review by the applicable court; (e) a waiver of, or any other limitation On. DBNTC or the Securitization Trusts', or any predecessor in interest to DRNTC's or the Securitization 'Trusts', right to seek a withdrawal of the reference with respect to any matter, including any matter relating to this Proof of Claim; or (t) a waiver or release of, or any other limitation on. DBNTC's or the Securitization T'rusts', or any' predecessor in interest to DBNTC's or the Securitization 'frusts', right to assert that any portion of the claims asserted herein are entitled to treatment as priority claims. Without limiting the generality of the the Trustee asserts, on behalf of each Trust and itself, the right to set off the foregoing, amount of all claims of such Trust and itself as Trustee of such Trust, against all claims and, amounts assertable by or distributable to WAMU (or its successors-in-interest under the Governing l.:)ocuments) in any capacity, including, without limitation, any rights of WAMU to recover delinquency advances, servicing advances or other amounts distributable with respect to securities or other interests in such Trusts.

10701777 6

The

Reckoning WaletaBIZIt lachTet\t-IME66oRM Ger i es DOCILIMIlent

litti2://wwElIST0812662 O., 11/28/Ra9e slavlatfnafttml


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THE RECKONING

More Articles in Business

Saying Yes, WaMu


By PETER
Published. December 27, 2008

Built

Empire

on

Shaky

Loans
.....-L.,
SIGN IN TO E-MAL OR SAVE THIS

::4-2:,

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S GOODMAN and GRETCHEN MORGENSON

Hav, yOU
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joined

WS fr

"We

hope

to do to to

this

industry

what Mil-_Also: did to theirs,


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theirs, Costco did

theirs and Lowe's-tiome

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Linked:

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to

their

years from

now

industry. And I think if we've done our job, five you're not going to call us a bank."
ima_.

The New York Times and Linkedin have teamed up to give you customized Industry news. Automatically.
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liarge ir

1ff. :1;11111111111 h

IG1linger, Keny iN NV.hingt on Nititul 2003 a,


K. SAN DIEGO
As
a

chief executive of

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supervisor at

i.

Washington
Parsons
was

Mutual mortgage processing center, John D. accustomed to seeing baby sitters claiming

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about energy.
FM,

i`

i,c:e:i.. .;ii iV,iii,`'ii'':i.l.,:


Ai,
Huftaker for The New York THTIOS

..o...
Sendy
"It
was

worthy of college presidents, and schoolteachers vvith incomes rivaling stockbrokers'. He rarely questioned them. A real estate frenzy was under way and WaMu, as his bank was known, was all about saying yes.
Yet

salaries

FOIL ARTUES
AND NiATE l IBM SOLUTIONS

just disheartening said Sherri Zaback, a mortgage screener for Washington Mutual "Just spit it out and get it done That's they wanted us to do Garbage in, garbage out

by WaMu's relaxed standards, one mortgage four years ago raised eyebrows. The borrower was claiming a six-figure income and an unusual profession: mariachi singer.
even

v,

The Green Road Less Tra eled

The

Reckoning
explored

Mortgage Factory
Articles in this series have

had him

the

causes

of the financial crisis,

verify the singer's income, so he photographed in front of his home dressed in his mariachi outfit. The photo went into a WaMu file.

Mr. Parsons could not

Flush With

Energy

Previous Articles in the Series

Approved. piece of documentation was properly signed and dated, said Mr. Parsons, speaking through wire-reinforced glass at a California prison near here, where he is serving 16 months for theft after his fourth arrest all involving drugs.
While Mr. Parsons, whose incarceration is not related to

"I'd lie if I said every

Muttimedia

Doha and Dalian

I
viceo
Jr

his work for WaMu,


I ritii, il PON,

oversaw a

-lung

applications,
he said.
"In
our

he

was

screening mortgage snorting methamphetamine daily,


team

It's Too Late for Later

world, it

was

tolerated, said Sherri Zaback, who

worked for Mr. Parsons and recalls seeing drug paraphernalia on his desk. "Everybody said, 'He gets the job done.'

tvt
At

mit ;New flork 'elutes


'et-AVM=

WaMu, getting the job done

meant

lending

money to

nearly anyone who asked for it

the force behind the

1 of 7

12/30/2008 11:13 AM

The

Reckoning WaNCase 41:09pOlfrOtafiletaNiQries OQMIlicte.nt


bank's meteoric rise and its
in the

firti2//wwFilif46=16a400/28/leafitOsinWainami?_r= I &sq=w...
this year

biggest bank failure

in American

precipitous collapse history.

0 lir
4,,
l

Breaking News
On

Alerts

by E-Mail
important

ih

l'.:.1
..f
.6 h.v,

T,

landscape littered with wreckage, WaMu, a Seattle-based bank that opened branches at a clip worthy of a fast-food chain, stands out as a singularly brazen case of lax lending. By the first half of this year, the value of its bad loans had reached $11.5 billion, nearly tripling from
a

financial

r Pruvp
E-

to be notified when

news,

breaks.

riacy Policy

MOST POPULAR

BUSINESS

$4.2 billion

year earlier.

I,

'...i.t

4,

PUSH TO GROW Former employees say that wth Kerry Krllinger in charge, WaMu became a loan factory, ignoring borrowers' incomes

employees, mortgage brokers, real estate agents and appraisers reveal the relentless pressure to churn out loans that produced such results. While that sample may not fully represent a bank with tens of thousands of people, it does reflect the views of employees in WaMu mortgage operations in California,

Interviews with two dozen former

MAIti;, ,: I BI L:0;:G;, E, LO,


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4., lri NPR 5. ilie

Reportei

Bei

init.,I

he
WaMii Built

Florida, Illinois and Texas.


6.

Reckoning. Saying Yes. Shilk^ I.oatas

Eininte

on

Et

erybodyl,

Bil, itle`iii.

rhey'l'old
li

tile .1 liat Miglitif

Their accounts

are

consistent with those of 89 other former


a

employees

who are

No, er I Ansi Mimes

confidential witnesses in
former shareholders.

class action filed

against

WaMu in federal court in Seattle

by

7.

Gal.proni. Once Migh 6


Von

Reelmg
Singing,
it

8
9.

'Patios

Reu tined, Without the PIlliti' Irs Nflt .111, l,I

(kitten Inc
Gen, inor

It',

di)

Ilitungeriet,

According
WaMu's
Between
to

executives

these accounts, pressure to keep lending emanated from the top, where profited from the swift expansion not least, Kerry K. Killinger, who was chief executive from 1990 until he was forced out in September.
to
2001

10wad< w, 111, 1-111, -tir, ol, t,,,, c, tip


rkI
ist nmptete L,

the Corporate

and his

Killinger received compensation of $88 million, according Library, a research firm. He declined to respond to a list of questions, spokesman said he was unavailable for an interview.

and 2007, Mr.

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DINING
nyt Imes corn/dining

During Mr. Killinger's tenure, WaMu pressed sales agents to pump out loans while.. disregarding borrowers' incomes and assets, according to former employees. The bank 'A. ik set up what insiders described as a system of dubious legality that enabled real estate, 40". agents to collect fees of more than $1o, 000 for bringing in borrowers, sometimes, 1 making the agents more beholden to WaMu than they were to their clients.
Let the

good
recipe,
r

times

selling the riskiest loans, which carried higher fees, bolstering profits and ultimately the compensation of the bank's executives. WaMu pressured appraisers to provide inflated property values that made loans appear less risky, enabling Wall Street to bundle them more easily for sale
WaMu gave mortgage brokers handsome commissions for
to investors.

tiptoe

Also in
N..c.

Dining'
ear s

HoIrdav_ beverage
acquaii
ir

rssert recipe:.
`c,, otten

ntmAsamaistalaggzellimillmisElliminnittl

"It

was

the Wild West, said Steven M. Knobel,

Mitchell, Maxwell & Jackson, alive, they would give you a loan. Actually, I think if you were dead, they would still give
you
a

company, that did business with WaMu until 2007. "If you were

founder of an

appraisal

ADVERTISEMENTS

Vanguard
A handful al kinds that investors' needs Need to know more,
can meet most

Donate Now

loan."
WaMu for

1=3

SeP50

anomie del riery or The

JPNIorgan Chase, which bought


billion
a

$1.9 billion in September and received $25

Tares

few weeks later

as

part of the taxpayer bailout of the financial services industry,

oGf'.i.th5n: yWohrekIlTy.0 sg
Real

fc

the

gift

declined to make former WaMu executives available for interviews.

JPMorgan also declined to


company. "It is
a

comment on
era

WaMu's

different

for

our

customers and for

operations before it bought the the company, a spokesman

Get Times Reader Free. A Digital Newspaper That Reads Like The Thing

said.
rup.

For those who

placed

their faith and money in WaMu, the bank's

implosion

came as a

OBAMA

shock.
"I
never

NOM 4 WAX JUT 213E acammate Subscribe now to The New Yolk Times snow BO% eff. ellIck bore.*

ellitNewflorkareers
had
a

clue about the amount of off-the-cliff activity that

was

going

on

at
Ads

Washington Mutual, and I was in constant contact with the company, said Vincent Au, president of Avalon Partners, an investment firm. "There were people at WaMu that

by Google

what's this?

2 of 7

12/30/2008 11:13 AM

The

Reckoning

warCasett097pm-01656AMOoriesDacurzient lit?://wiagdn0812A/20092/28gage,,, s1-40 25


nothing
more

J-1 &sq-vv...

orchestrated

than
a

sham

OF

charade. These

people

broke every

fundamental rule of running


'Like
a

UM bilical Cord Bank


Get
a

orripany,

FREE Information Kit CA Residents Save

Sweatshop'

$500, Exp 1/16


Aww.Vir-iCord

corn/Core-Blood-Experts

Sorne N.VaMu

employees

who worked for the bank


a

during

the boi)al

now

have regrets.
at a WaMu
Ads

"It

was a

branch
loans."

ri

disgrtvte, 'I'ampa,

said Ufana Zweibel, Ha. "We


wore

torn-ter financird
to

representative
never

givnig

loans

people

that

should have hail

by Coogle

what's this?

Cord Blood Banking


Bank Your

Baby's Cord Blood CA Residents

if Ms. Zweibel doubted whether customers could pay, selling, she said.
"We
to
were

supervisors

directed her to

keep

Exp 1/16 www.ViaCord.com/Cord-Blood-Experts

Save $500,

told from up above that that's not

our

concern, she said, "Our coricenr is

just

write the loan."

The ultimate

supervisor

II

WaMti

was

Mr.

Killinger,
a

and beca Me chief executive ih 1990. Ile inherited had survived the
An investinent Between late

bank that

who joined the company in 1983 was founded in 1889 and

{repression

iind the

I(irut scandal of the 19805.

ailalyst by trairlilig, he was atttined to Wall Street's huriger for growth. t996 and early 2002, he transtOrmed WaMu into the nation's sixth-largest
a

bank

through

series of

acquisitions.

A crucial deal

came

ill 3999, with the

lender credit..

specializing

in

purchase of Long Beach Financial, a California subprime mortgages, loans extended to borrowers with troubled

WaMu underscored its eagerness to lend with

an

durifig
was

the 2003

Academy Awards: "The

Power of Yes." No

advertising campaign introduced mere advertising pitch, this

also the mantra inside the bank, underwriters said.


came

"WaMu

out with that


a

slogan, and that

was

what

we

had

to

live by, Ms. Zaback


and then somehow

said. "We joked about it

get approved.

lot." A file would get marked "We'd say: `O.K.! The power of yes.'

pmblematic

Revenue at WaMu's

home-lending

unit swelled from

$707inillion

ill 2002 to almost $2

billion the

following

year, when the The Power of Yes"

campaign

started.

Between 2000 and 2003, WaMit's retail brunches grew 70


across

:38 states,

customer's. in

percent, reaching 2, 200 image of cheeky irreverence to attract new offbeat television ads, casually dressed WaMu employees ridiculed staid
as

the bank used

an

bankers in suits.
were pushed to increase lending. "It was just disgusting, said Ms. Zweibel, Tampa representative. 'They wanted you to spend time, while you're running teller transactions and opening checking accounts, selling people loans."

Branches

the

Employees
an

to

Thmpa who fell short were ordered to drive to a WaMu office in Sarasota, they sat in a phone bank with 20 other people, calling customers push home equity loans.
hour away. There,

in

-the

regional

manager would be

over

your

shoulder, listening
in
a

to every

word,

Ms.

Zweibel recalled.

"They treated

us

like

we were

sweatshop."

On the other end of the country, at WaMu's San Diego processing office, Ms. Zaback's job was to take loan applications from branches in Southern California and make sure they passed muster. Most of the loans she said she handled merely required borrowers to provide an address and Social Security number, and to state their income and assets.

She

ran

applications through WaMu's computer system

for

approval.

If she needed

more

3 of 7

12730/2008 11:13 AM

The

Reckonilqi

WiiCaseill:0916m-046156nRM CCI esDocument 14//wwFUOT08/26120092/28/Pages125,QC-2.5tml?

.1-- I

&sq-w

information, she had to consult with a loan officer which she described as an unplea Sa [It experiellee. "They would be furious, Ms. Zaback said. -They would put it you, that they weren't going to get paid if von stood in the way."
On
one

on

loan

application
income

in 2oo5,

borrower idetitified himself

as a

his

monthly
so

at Si 2, 000, Ms. Zaback recalled. She could not

gardener and listed verify his business

lictinse,

she took the file to her boss, Mr, parsons.


Ina

Fie used the

riachi

singer

as

inspiration:

with the

name

of his la ndscapin g business

went

photo of the borrower's truck emblazoned into the file. Approved.

his

Diego from about 2002 through 2005, said supervisors constantly praised his performance. "My mimbers were through the roof, he said.
occasion,
Ms. Zaback asked
a a

Mr, Parsims, who worked for WaMu in San

On another
assets, The

loan officer fur verification of an

applicant's

balance of about $150, 000 in the borrower's account, she recalled, But when Ms. Zaback called the bank to confirm, she
a
a

officer sent

letter from

bank

showing

was

told the balance

was

only $5, 000. her,


Ms. Zabatik recalled. "She

The loan offfivr

yelled

at

said,
no

'We don't call the bank to


to

verify.'

Ms. Zaback said she told Mr. Parsons that she

longer wanted

work with

that loan officer, but he

replied:

'Too bad."

Shortly thereafter, Mr. Parsons disappeared from his arrest for burglary and drug possession.
The slicer workload
at

the office. Ms. Zaback later learned of

WaMu ensured that loan reviews

were

limited. Ms. Zaback's


was

office had108
at

least

to

people, files daily.

aud several hundred

new

files

day. She

required

to process

typically spend a inaximum of 35 minutes per file, she said. "It was just disheartening..lust spit it out and get it done. That's what they wanted us to do. Garbage in, and garbage out."
Referral Fees for Loans WaMu's boiler
rose so room

"I'd

culture nourished in Southern California, where


the bubble that creative

rapidly during

financing

was

needed to attract
rate

housing prices buyers.


mortgages that

To that

end, WaMu embraced so-called option ARMs, adjustable


a

enticed borrowers with

selection of low initial rates and allowed them to decide how

much to pay each month. But

underpaying
payments

the interest due and

people who opted for minimum payments were adding to their principal, eventually causing

loan

to balloon.

Customers

were

often left with the


to

impression that

low payments would continue

long

term,

according

former WaMu sales agents.

option ARMs, in particular were especially they carried higher fees than other loans, and allowed WaMu to book profits on interest payments that borrowers deferred. Because WaMu was selling many of its loans to investors, it did not worry about defaults: by the time loans went bad, they were often in other hands.
attractive because

For WaMu, variable-rate loans

adjustable-rate mortgages expanded from about one-fourth of new home loans by 2006. In 2005 and 2006 when WaMu pushed option ARIVIs most aggressively Mr. Killinger received pay of $19 million and $24 million respectively.
in 2003 to 70 percent

WaMu's

The ARM Loan Niche

4 of 7

12/30/2008 I 1 :13 AM

The

Reckoning WaNCase

alt:(19crokOit aft6yRKGri es Document ritgiwwFileck081261.2009/28Rage/16,4S25, 11?


I1owney, Ca I 1,, specialized in selling rtption ARMs
to

Wa Mti's retail mortgage office in

1, 30110 customers who

spoke

little

Rtighsh

and

brokers, according to

fimtmer sales agent who

depeniled on advice 1:1:0111 real requested anonymity beem Ise

estate

he

was

still

in the mortgage business.

According to that agent, WaMu turned real estate agents into a pipeline for loan applications by enabling them to collect "referral fees" for clients who becaine WaMu
borrowers.

Buyers

were

typically oblivious

to

agents' tees,

the agent said, and agents

rarely

explained

the loan terms.


was

-Their Realtor
on a

minimum payment, and that

their trusted friend, the agent said. 'The Realtors would sell them was an outright lie." the strategy
20

According to the agera,


oversaw a

sales

team
now

of about

the braiiichild of Thomas Ramirez., who agents at the Downey branch during the first half of
was

this decade, and

works COY

Mr. Rantirez continued thttt he and his team enabled real estate agents to collect

comanssions, but he maintained that the .fees


"I don't think die bank would have let
us

were

fufly disclosed.
was

do the program if it

bad,

Mr, Ramirez

said.
Mr. Ramirez's team soki nearly $1 billion worth of loans in 2004, he said. His perforrnance made hint a perennial member of WaMu's President's Club, which brought big bonuses and recognition at an awards ceremony typically hosted by Mr. Killinger in tropical venues like I lawaii

Mr. Ramirez's

success

prompted

WaMu to

with loan processors, underwriters and


so

populate a neighboring building in Downey appraisers who worked far him. The fees proved

enticing bearing six

that real estate agents arrived in Downey from ail over Southern California, and seven loan applications at a time, the former agent said.

WaMu banned referral fees in 2006,

fearing they could

be construed

as

illegal payments
using the

from the bank

to

agents.

But the bank allowed Mr. Ramirez's team to continue

referral fees, the agent said. Forced Out With Millions

By
as

2005, the word

was

out

of the borrower's income and assets

that WaMu would accept applications with a mere statement so long often with no documentation required
to Ms. Zaback and

credit

scores were

adequate, according
a

other underwriters.
a

"We had

flier that said, 'A thin file is

good file,

recalled Michele Culbertson,

wholesale sales agent with WaMu.


Martine Lado,
an

agent in the Irvine, Calif., office, said she coached brokers

to leave
or

parts of applications blank to avoid income was sketchy.


"We
were

prompting

verification if the borrower's job

looking

for

people who understood

how to do loans at WaMu, Ms. Lado said.

Top producers became heroes. Craig Clark, called the "king of the option ARM" by

colleagues,
coworkers,
"He
was a

closed loans
a

tally he

amassed in part
came

totaling about $1 billion in 2005, according to four of his former by challenging anyone who doubted him.
to

bulldozer when it

getting his stuff done, said

Lisa Alvarez, who

worked in the Irvine office from 2003 to 2006. Christine Crocker, who

managed WaMu's wholesale underwriting division

in

Irvine,

of 7

12/30/2008 11:13 AM

'the

Reckoning Wapease t Itlikarpm-Dat656nRAGeri esDocument

\FA14414)812612.0092/28Ptaggs12744k2.5tmp_y- I Szscj'"v...

recalled With
a

one

mortgage

to an

elderly couple
a

from

broker

on

Mr. Clark's team


a

fixed inconte of about $3, 200


a

mouth, the couple needed

fixed-rate loan, But

cominission of three percentage points by arranging an option ARM for them, and did so by listing their income as $7, 000 a month. Soon, their

their broker earned

payment jumped frian rl-mghly $i3O00 behi tid.


Mr.

month

to

about $3, 000,

causing them

to

fall

Clark, who
no

now

works for iIPMorgan, referred calls to

company

spokesman,

who

provided

further details.

in 2 o o 6, WaMu slowed ojition ARM lending. But earlier, ill-considered loans had aireally begun hurting its results, In 2007, it recorded a $67 million loss and shut down its subprimc lending unit,

By the time shareholders joined WaMu for its annual meeting in Seattle last April, posted a first-quarter loss of $1.14 billion and increased its loan loss reserve to $3.5 billion. Its stock had lost more than half its value in the previous two months. Anger was in the air.
WaM u had

Some shareholders

were

irate that Mr.

Killiiiger and other executives

wore

excluding

nairtgage losses from the cionputation of their bonuses, Others were enraged that WaMil turned down an $8-a-share takeover bid from JBMorgan.
"Calm down and have this."
Wa Mu asked sliareholders to approve
a a

little faith, Mr.

Killinger told

the crowd. "We will get

through

$7 billion investment by Texas Pacific Group,


a

private equity firm,


Pacific and
a

and other unnamed investors.

founder of Texas

former WaMit director, declined to comment. but Mr.

Elostile shareholders

forced it

argued that the deal would dilute their holdings, through, saying WaMu desperately needed new capital.

Killinger

Weeks later, with WaMu in tatters, directors

chairmanship.

And the bank

stfipped Mr. Killinger of his board began including mortgage losses when calculating

executive bonuses.
In

under

September, Mr. Killinger was forced to retire. Later that month, with WaMu buckling roughly $18o billion in mortgage-related loans, regulators seized the bank and
a

sold it to PMorgan f0 17 $1.9 billion,

fraction of the $40 billion valuation the stock

market gave WaMu at its

peak. plowed into WaMu were wiped out, as were prospects for employees. But Mr. Killinger still had his millions, rankling

Billions that investors had


many of the bank's 50, 000

laid-off workers and shareholders alike.

"Kerry has made

over

$100 million

over

his tenure based

sunk the company, said Mr. Au, the money manager. "How does he

on.the aggressiveness that justify taking that

money?"
In

June, Mr. Au

some

sent an e-mail message to the company of their pay. He says he has not heard back.

asking

executives to return

A version of this article

appeared in print

on

December 28, 2008,

on

More Articlos

E3usinef, s

page Al of the New York edition

6 of 7

12/30/2008 11:13 AM

The

Reckoning

Wa ICEMAN

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7 of 7

12/30/2008 11:13 AM

Case 1:09-cv-01656-RMC

Document 1-2

Filed 08/26/2009

Page

19 of 25

Exhibit A-1 To Proof of Claim of


Deutsche Bank National Trust

Company

Agreement
Isstie ID

Original

Collateral

Current

Principal

Transaction

Series

Date

Balance

Balance 9/25/08

1 B0002

1.ong
Long

Beach

Mortgage

Loan 'Irust

2000-1

12/1/00

1, 000, 000, 594.71

34, 811, 895.51 59, 532, 662.65


36, 039, 908.53

LB00F1

Beach Home

Equity

Loan Trust 2000-LB1

8/1/00

1, 312,248, 898.65
725, 466, 488.78 1, 594, 353, 660.72, 1, 001, 006, 145.53 1, 999, 995, 140.51

1,130101

I, ong Beach

Mortgage
Mortgage Mortgage

1, 0an Trust

2001-1

3/1/01

LB0102

Long

Beach

Loan Trust

2001-2

7/1/01

71, 505, 949.50,


49, 540, 692.95 104550975.6

LB0103

Long
Long

Beach

Loan Trust

2001-3

9/1/01

L130104

Beach

Mortgage
Mortgage
Mortgage

Loan f rust

2001-4

12/1/01

L130201

Long
Long

Beach

Loan Trust

2002-1,
2002-2

4/1/02,
6/1/02

1, 600, 002, 996.85,


1, 000, 001, 438.60

78, 501, 732.67

LB0202

Beach

Loan Trust

52, 951, 722.09


73, 845, 139.93 130, 090, 598.75 63, 358, 995.33, 75, 119, 530.93 224,438, 308.88 532, 202, 224.67 204, 931, 765.30 292, 775, 378.36 386, 675, 678.52 151,014, 830.26 165,563, 241.68

LB0205

Long

Beach

Mortgage
Mortgage

Loan Trust

2002-5

11/1/02

1, 000, 000, 848.34


2, 000, 000, 169.33
926, 370, 950.24

LB0301, Long
LB0302

Beach

Loan Trust

2003-1,
2003-2

2/1/03

Long Beach Mortgage


Long Beach Mortgage

Loan Trust

4/1/03

LB0303

Loan Trust

2003-3

6/1/03

900, 000, 208.99 2,200,000, 305.17

LB0304

Long
Long

Beach

Mortgage Mortgage Mortgage


Mortgage
Mortgage Mortgage Mortgage

Loan Trust

2003-4

7/1/03

LB0401

Beach

Loan Trust

2004-1

2/1/04

4, 500, 000, 018.86


1, 519, 139, 252.43 1, 999, 383, 410.65

LB0402

Long
Long
Long

Beach

Loan Trust

2004-2

5/1/04

LB0403

Beach

Loan Trust

2004-3

6/1/04

LB0404

Beach

Loan Trust

2004-4

9/1/04

2, 719,328, 087.12 1, 015, 407, 092.63 1, 104,297, 532.58 3, 500, 003, 000.56 2, 500,002, 732.02

LB0405

Long
Long

Beach

Loan Trust

2004-5

8/1/04

LB0406

Beach

Loan Trust

2004-6

10/1/04

LB0501

Long Beach Mortgage

Loan Trust

2005-1

1/1/05

581, 873, 653.66


485, 463, 232.28

LB0502

Long

Beach

Mortgage

Loan Trust

_2005-2

4/1/05

Case 1:09-cv-01656-RMC

Document 1-2

Filed 08/26/2009

Page

20 of 25

Exhibit A-1 To Proof of Claim of Deutsche Bank National Trust Company


ftgreentent, Original
Issue H) "I'rausaction Series
Date Collateral
urrent

Principal

Balance

Balance 9/25/08

1, 130503,

Long

Beach

Mortgage

Loan Trust

2005-3

9/1/05

1, 527, 819, 573.20,


2, 783, 633, 153.00

496, 077, 274.56 624, 023, 514.56,


791, 199, 316.92
827, 566, 265.49

LBO5WI

Long

Beach

Mortgage

Loan Trust

2005-WL1

7/1/2005

L B05 W2

Long Beach Mortgage Loan Trust


Beach

2005-WL2

8/1/05

2, 755, 716, 668.32


2, 191, 257, 007.17

LBO5W3

Long
Long

Mortgage
Mortgage Mortgage

Loan Trust

2005-WL3,
2006-1

11/1/05

L130601

Beach

Loan Trust

2/1/06

2, 499, 987, 903.06 3, 003, 799, 169.81


1, 743, 796, 134.40
1, 922,678, 765.19
1, 925, 001, 176.58

1, 160, 361, 979.44, 1, 386, 914, 706.65

LB0602

1, ong Beach

Loan Trust

2006-2

3/1/06

LB0603

Long
Long Long Long

Beach

Mortgage
Mortgage

Loan Trust

2006-3

4/1/06

888, 155, 925.30


1, 053, 549, 542.12

LB0604

Beach

Loan Trust

2006-4

5/1/06

LB0605

Beach

Mortgage Mortgage
Mortgage

Loan Trust

2006-5

6/1/06

1, 061, 924, 757.27 1, 031, 620, 844.36

LB0606

Beach

Loan Trust

2006-6

7/1/06,
8/1/06

1, 688, 107, 433.24

LB0607

Long Long

Beach

Loan Trust

2006-7,
2006-8

1, 596, 611, 009.81


1, 380, 727, 062.40 1, 520, 086, 184.10

1, 066, 308, 386.86

1, 130608

Beach

Mortgage

Loan Trust

9/1/06,
10/1/06

954, 086, 893.15


1, 091, 628, 311.24 144,205, 711.88 740, 325, 465.58

LB0609

Long Beach Mortgage

Loan Trust

2006-9

L13060A

Long
Long

Beach

Mortgage Mortgage

Loan Trust

2006-A

5/1/06

532,619, 585.98
1, 008, 199, 873.58
1, 499, 999, 921.58

LB0610

Beach

Loan Trust

2006-10

11/1/06

LBW 1

Long

Beach

Mortgage

Loan Trust

2006-11

12/1/06

1, 126, 024, 144.81


810, 309, 534.48 739, 358, 759.85 737, 068, 803.57 480, 305, 038.41 19,541, 729.02 32, 739, 901.70

1.1306W1

Long Beach Mortgage

Loan

Trust, 2006-WL1
2006-WL2

1/1/06

1, 903, 659, 401.04


1, 908,950, 760.04

LI306W2

Long

Beach

Mortgage

Loan Trust

1/1/06

Long Beach Mortgage Loan Trust Washington Mutual Mortgage WA0001, Securities Corp. Washington Mutual Mortgage
WA0107

LBO6W3

2006-WL3

1/1/06

1, 917, 874, 232.74 6, 701, 536, 869.34 1, 051, 032, 555.94


1, 167,350, 333.57

2000-1

3/31/00

WAO1A3

Corp. Washington Mutual Mortgage _Securities Corp.

Securities

2001-7

5/1/01

_2001-AR3

11/9/01

Case 1:09-cv-01656-RMC

Document 1-2

Filed 08/26/2009

Page

21 of 25

Exhibit A-1 To Proof of Claim of Deutsche Bank National Trust Company


A giTentent

Original

Collateral

r rent

Prnicipal

Issue

11)

Transaction

Series

Date

Balance

Wla nee 9/25/08 133, 386, 070.04

Washington Mutual WAO2A2 Securities Corp. Washington Mutual WAO2A6 Securities Corp. Washington Mutual WA02A9 Securities Corp. Washington Mutual WAO2AC Securities Corp. Washington Mutual WAO2AD, Securities Corp. Washington Mutual Securities Corp. WAO2AE, Washington Mutual WAO2AF Securities Corp. Washington Mutual WAO2AG Securities Corp. Washington Mutual WAO2AH Securities Corp. Washington Mutual
WAO2A1

Mortg, age
2002-AR2

2/26/02

846, 869, 196.58 976, 270, 151.47


1, 497, 233, 409.59

Mortgage
2002-AR6

5/1/02

33, 967, 222.14


63, 032, 301.89

Mortgage
7002-AR9

7/1/02

Mortgage
2002-A R12

9/1/02,
9/1/02

998, 724, 014, 44


801,901, 920.87
1, 028, 589, 782.28
1, 975, 024, 800.28

7, 164, 395.08 6, 622, 003.44

Mortgage
2002-AR13

Mortgage
2002-AR14 10/25/02

10, 938, 312.60 22, 477, 420.27 21, 216, 427.56 59, 353, 086.07
48,423, 693.51 47, 816, 425, 15

Mortgage
2002-AR15

10/1/02

Mortgage
2002-AR16

10/1/02

1, 030, 719, 967.88, 1, 141, 838, 488.95 1, 995, 977, 878.00 1, 999, 854, 039.48

Mortgage
2002-AR17

10/1/02

Mortgage
2002-AR18

Securities

Corp.
Mutual

11/1/02

WAO2Aj

Securities

Washington Corp.

Mortgage
2002-AR19 12/1/02

.WAO2T1 Washington
WAO2T2

Mutual Bank FA

7002-PR7

9/27/02

$1, 810, 000, 000.00 $1, 569, 403, 402.00


1, 929, 958, 305.53
453, 072, 396.92 1, 498, 678, 348.09

$412, 182, 299.00

Washington

Mutual Bank FA

2002-PR3

11/26/02

$460, 528, 036.14


78, 084, 582.05

WAO3A1

WAO3A2

Washington Mutual Mortgage Securities Corp. Washington Mutual Mortgage Securities Corp.
Washington Mutual Mortgage

2003-AR1

1/1/03

2003-AR2

2/1/03

14, 354, 070.03 76, 606, 402.47


96, 324, 730.77

WAO3A3

WAO3A4

WAO3A5

WAO3A6

WAO3A7

WAO3A8

WAO3A9

Corp. Washington Mutual Securities Corp. Washington Mutual Securities Corp. Washington Mutual Securities Corp. Washington Mutual Securities Corp. Washington Mutual Securities Corp. Washington Mutual Securities Corp.

Securities

2003-AR3

2/1/03

Mortgage
2003-AR4

3/1/03

1,248, 537, 577.61


1,497, 993, 405.95
1, 817, 570, 225.97 1, 782, 734, 144.99

Mortgage
2003-AR5

4/1/03

191, 453, 076.81


273,859, 507.75 330, 974, 020.39 306, 284, 588.45 459,523, 660.91

Mortgage
2003-AR6 5/1/03

Mortgage
2003-AR7

6/1/03

Mortgage
2003-AR8 7/1/03

1, 249, 964, 133.60 1,499, 961, 494.15

Mortgage
2003-AR9

8/1/03

Case 1:09-cv-01656-RMC

Document 1-2

Filed 08/26/2009

Page

22 of 25

Exhibit A-1 To Proof of Claim of

Deutsche Bank National Trust


Agreement
Issue ID

Company
Collateral
ce

Original

Current 1>rin6pal
Balance 9/25108

TrUnsact ion

Series

Date

Ba la

Washington Mutual Mortgag, WAO3AA Securities Corp. Washington Mutual Mortgage WAO3AB Securities Corp. Washington Mutual Mortgage WAO3AC Securities Corp. Washington Mutual Mortgage WAO4A1 Securities Corp. Washington Mutual Mortgage WAO4A2 Securities Corp. Washington Mutual Mortgage WAO4A3 Securities Corp. Washington Mutual Mortgage WAO4A4 Securities Corp. Washington Mutual Mortgage WAO4A5 Securities Corp. Washington Mutual Mortgage WAO4A6 Securities Corp. Washington Mutual Mortgage WAO4A7 Securities Corp. Washington Mutual Mortgage WAO4A8 Securities Corp. Washington Mutual Mortgage WAO4AA Securities Corp. Washington Mutual Mortgage Securities Corp. .WAO4AC Washington Mutual Mortgage WAO4AD Securities Corp. Washington Mutual Mortgage WAO5A I Securities Corp. Washington Mutual Mortgage WAO5A2 Securities Corp. Washington Mutual Mortgage WAO5A4 Securities Corp.
Washington Mutual
WAO5A6

2003-AR I 0

9/1/03

2, 149, 945, 638.93 569, 335, 006.37


624, 366, 307.97 549, 954, 684.34

758, 972, 394.10


201, 418, 222.95

2003-AR11

10/1/03

2003-AR12

12/22/03

169, 054, 089.25

2004-ARI

2/12/04

184, 779, 040.96


75, 847, 329.67

2004-AR2

4/28/04

607, 568, 701.01


I, 199, 094, 712.64 999, 949, 639.60

2004-AR3

4/27/04

627, 200, 249.89

2004-AR4

5/25/04

640, 104, 266, 85


319, 246, 042.00

2004-AR5

5/25/04

324, 778, 296.44

2004-AR6

5/27/04

694, 961, 493.88


899, 173, 380.28

120, 471, 550.20


557, 746, 399.24

2004-AR7

6/24/04

2004-AR8

6/25/04

763, 824, 537.00


1, 264, 666, 962.70
1, 784, 625, 919.86 1, 539,705, 677.27
2, 971,414, 173.32 3, 267,405, 771.83

135, 742, 545.16 243,688, 955.92 340, 395, 443.18


325, 216, 452, 97

2004-ARI0

7/27/04

2004-AR12,
2004-AR13

10/26/04

11/23/04

2005-AR I

1/18/05

714, 587, 307.20 920,722, 624.68 506,442, 449.82


932, 737, 574.84

2005-AR2

1/26/05

2005-AR4

3/24/05

750, 504, 106.41 3, 167, 184, 178.32 3, 029, 599, 417.91 1, 505,402, 999.34 3, 201, 069, 294.58 3, 901, 265, 905.06

Mortgage
2005-AR6 4/26/05

WAO5A8

WAO5A9

Corp. Washington Mutual Mortgage Securities Corp. Washington Mutual Mortgage Securities Corp.
Washington Mutual Mortgage

Securities

2005-AR8

7/15/05

893, 576, 756.98 423, 681, 934.44 1, 104, 192, 858.61 1, 555, 245, 023.74

2005-AR9

7/21/05

WAO5AA, Securities Corp.


WAO5AB WaMu Asset

2005-AR10

8/25/05

Acceptance Corp.

2005-AR13

10/25/05

Case 1:09-cv-01656-RMC

Document 1-2

Filed 08/26/2009

Page

23 of 25

Exhibit A-1

To Proof of Claim of Deutsche Bank National Trust

Company
Current

Agreement Original Collateral


IssuelD Transaction

Prindpal

Series

Date

Balance

Balance 9/25/08

WAO5AC WaMu Asset

Acceptance Corp.

2005-A R 16

11/23/05

924, 385, 186.87

709, 012, 720.73

WAO5AD, WaMu
WA060 I Trust

Acceptance Corp. Mutual Home Equity Washington

Asset

2005-AR18,
1

12/29/05

767,442, 752.54
5, 389,459, 150.00 2, 736, 034, 892.85,
1, 516, 188, 758.27

759, 313, 543.32


3, 561,666, 083.13
1, 376, 479, 667.76

3/7/2006

WA0602

WaMu

2006-OA I

12/13/2006

WAO6A1

WaMu Asset

Acceptance Corp., 2006-AR I

I /30/06

719,352, 278.04

WAO6A3

WaMu Asset

Acceptance Corp.

2006-AR3

2/23/06

1, 019, 582, 771.26


932, 087, 563.09

512, 708, 347.22 474, 865, 940.42 481, 442, 704.76

WAO6A4 Securities

Washington Mutual Mortgage Corp.


WaMu Asset

2006-AR4

4/25/06

WAO6A5

Acceptance Corp., 2006-AR5 Program Program


I

5/25/06
One

796, 522, 188.53

Revolving

Pool

WAO6C1

WM Coered Bond

5/18/07

for all Series One

Revolving Pool
Series

WAO6C2

WM Covered Bond

5/18/07, for all


10/25/2007

WA0701

WaMu

2007-Flex1

5, 199, 147, 685.89


One

4, 067, 805, 919.38

Revolving

Pool

WAO7C3

WM Covered Bond

Program
2007-HE I

3,

5/18/07,
1/1/07

for all Series

WAO7H1

WaMu Asset

Acceptance Corp.

1, 393, 794, 251.58

1, 096, 561, 655.17


17, 992, 505.24

C09201

Coast Federal

1992-1

8/1/92

374, 106, 546.77


416, 860, 972.94

DB9902

Ace Securities

1999-2

7/1/99

9,435, 113.28, 7,463, 097.13 122, 133, 901.15

MS0001

Morgan Stanley
GSAMP Trust

ABS

Capital

1 Inc.

2000-1

7/1/00

360, 107, 788.57 516, 812, 864.78

GS061., 1

2006-S1

1/1/06

0S05X2

GSAMP Trust

_2005-S2

Case 1:09-cv-01656-RMC

Document 1-2

Filed 08/26/2009

Page

24 of 25

Exhibit A-2

To Proof of Claim of Deutsche Bank National Trust Company


Current
Issue ID LBO5N3 LE305N4 LBO5N6 LI106N6

Transaction

Series

Agreement

Date

Principal

Balance

Long
Long

Beach Asset Beach Asset Beach Asset


Beach Asset

Holding Corp.
iloldaig C.

CI 2005-WL I
C.

10/2112005,
9/7/2005

70, 367,411.73
12, 747, 551.05

2005-W L2,

Tong
Long

Holding Corp. Holding Corp.

C.12005-WL3,
CI 2006-3 2006-4 2006-5 2006-6

12/7/2005,
4/26/2006 5/30/2006
6/30/2006 7/31/2006 8/31/2006 9/27/2006
10/30/2006

20, 387, 875.63


27, 829, 138.01

LBOON7, Long

Beach CI NIM Notes Beach CI NEM Notes

32, 297, 749.83


31,437, 470.34
77, 629, 292.83

LBO6N8, Long
LBO6N9
LBO6NA

Long Long Long Long Long

Beach Cl NEM Notes


Beach CI NM

Notes, 2006-7
2006-8 2006-9

33, 011, 254.77


24, 248, 851.46

LBO6NB LBOONC LBO6ND LBO6NE

Beach CI NIM Notes


Beach CI NIM Notes

39, 191, 206.64.


26,473, 498.22 40, 894, 919.43
30, 502, 416.51
TBD

Beach CI NIM Notes Beach Cl N1M Notes


Notes

2006-10,
2006-11 2007-WM I

11/29/2006 12/27/2006 1/30/2007

Long

WAO7N1, WaMu CI NIM


LBO3P1

(LBO3PB

Long

Beach Securities
Securities

Corp. Corp.

2003-P1

(2003-W5)

4/30/03
6/26/03
5/26/04 11/24/04

LBO3P2, Long Beach


LBO4N2
LBO4N4

2003-W9
2004-2 2004-4

TBD.
TBD

Long Long Long Long

Beach Asset

Holding Corp.

Beach Asset Beach Asset Beach Asset


Asset

Holding Corp.
Holding Corp.

5, 755,410.65 9, 158, 820.66 15, 457, 776.33 8, 131, 609.43 43, 959, 237.65

LBO4N6 LBO5N2 LBO5N5 LBO6N2


LBO6N4

2004-6 2005-2 2005-3


2006-WL2

10/29/04
4/26/05

Holding Corp.
Holding Corp. Holding Corp. Holding Corp.

Long Beach Long Long

9/20/05
3/30/2006
2/28/06

Beach Asset Beach Asset Asset

2006-1
2006-2 CI

41, 252, 394.94


55, 779, 764.27
TBD TBD

LBO6N5
LBO7P3 LBO7P4

Long Beach

Holding Corp.
Holdings Corp
Holdings Corp

3/30/00
11/16/07

Long

Beach Asset Beach Asset

2003-3
2003-4

_Long

CI

11/16/07

Case 1:09-cv-01656-RMC

Document 1-2

Filed 08/26/2009

Page

25 of 25

Exhibit A-3 To Proof of Claim of Deutsche Bank National Trust Company

Iss ue ID

Transaction

Agreement Date

LBO3CM FB022C MOW

Lon!,,

BQach

Mortgage Company

Custodial

Agreement

10/15/2003 10/1/2002 6/1/2005

ASSET BACKED SECURITIES CORP. 200241E3

CREDIT SUISSE FIRST BOSTON B1 PARTY GREENWICH/DB FHA, VA AND CONVENTIONAL


GREEN W IC H/WAMU 2004-RP1

GC04EC GC04JC GCO56C GSO4 WC GS052C G505CC GS063C GS06EC


GS061IC

5/20/2004,
5/20/2004

GREENWICH RBSGC 2005-RP I

2/1/2005
12/1/2004 1/1/2005 6/1/2005 6/1/2006

GOLDMAN/LONG BEACH WAREHOUSE GOLDMAN/WASHINGTON MUTUAL CUSTODY WAREITO


GSAA 2005-7 SECURITY CUSTODY ONLY GSAA 2006-1 CUSTODY ONLY GSR 2006-5E CUSTODY ONLY GSR 2006 6E CUSTODY ONLY

5/1/2006
6/1/2006 8/1/2006 10/1/2006 3/1/2007 4/1/2007 6/1/2007 5/1/2007 6/22/2005 5/1/2001

GSO6MC GSO6RC GS078C


GS07BC

GSR 2006-8F CUSTODY ONLY SECURITY


GSR 2006-9F CUSTODY ONLY GSR 2007-2F CUSTODY ONLY GSR 2007-3F CUSTODY ONLY
GSR 2007-4F CUSTODY ONLY

GS07EC

L0032C, LONG
LB052C
LHO I 2C

BEACLUFANNIE MAE POOLS

WASHINGTON MUTUAL/LBMC REPO FACILITY

LEIIMAN/THORNBURG-SASCO 2001-8A
LEHMAN/ SASCO 2007-GEL2 MORGAN STANLEY 2002-WL1 BANK ONE TRUSTEE MORGAN STANLEY/LONG BEACH MORGAN STANLEY WAMU

LII07EC MS02BC

4/1/2007
6/1/2002

MSO2JC
MS03EC MSO45C

10/1/2002

9/1/2003,
3/23/2004 8/18/2004

MORGAN STANLEY FANNIE MAE MORGAN STANLEY FREDDIE MAC

MSO4GC
WA071C WA072C WA073C

WASHINGTON MUTUAL WAMU 2007-HE2 WASHINGTON MUTUAL WAMU 2007-HE3 WASHINGTON MUTUAL WAMU 2007-HE4

4/10/2007
5/10/2007 6/13/2007

Case 1:09-cv-01656-RMC

Document 1-3

Filed 08/26/2009

Page 1 of 2

Case 1:09-cv-01656-RMC

Document 1-3

Filed 08/26/2009

Page 2 of 2