Morgan Stanley 2015 Annual Report Download - page 35

ABS Capital I Inc. Trust, Series 2007-NC3 (MSAC 2007-NC3) v. Morgan Stanley Mortgage Capital Holdings LLC, and filed
a complaint in the Supreme Court of NY under the caption Deutsche Bank National Trust Company, solely in its capacity as
Trustee for Morgan Stanley ABS Capital I Inc. Trust, Series 2007-NC3 v. Morgan Stanley Mortgage Capital Holdings LLC,
as Successor-by-Merger to Morgan Stanley Mortgage Capital Inc. The complaint asserts claims for breach of contract and
breach of the implied covenant of good faith and fair dealing and alleges, among other things, that the loans in the trust,
which had an original principal balance of approximately $1.3 billion, breached various representations and warranties. The
complaint seeks, among other relief, specific performance of the loan breach remedy procedures in the transaction
documents, unspecified damages, rescission, interest and costs. On December 16, 2013, the Company filed a motion to
dismiss the complaint.
On December 30, 2013, Wilmington Trust Company, in its capacity as trustee for Morgan Stanley Mortgage Loan Trust
2007-12, filed a complaint against the Company. The matter is styled Wilmington Trust Company v. Morgan Stanley
Mortgage Capital Holdings LLC et al. and is pending in the Supreme Court of NY. The complaint asserts claims for breach
of contract and alleges, among other things, that the loans in the trust, which had an original principal balance of
approximately $516 million, breached various representations and warranties. The complaint seeks, among other relief,
unspecified damages, interest and costs. On February 28, 2014, the defendants filed a motion to dismiss the complaint.
On April 28, 2014, Deutsche Bank National Trust Company, in its capacity as trustee for Morgan Stanley Structured Trust I
2007-1, filed a complaint against the Company. The matter is styled Deutsche Bank National Trust Company v. Morgan
Stanley Mortgage Capital Holdings LLC and is pending in the United States District Court for the Southern District of New
York (“SDNY”). The complaint asserts claims for breach of contract and alleges, among other things, that the loans in the
trust, which had an original principal balance of approximately $735 million, breached various representations and
warranties. The complaint seeks, among other relief, specific performance of the loan breach remedy procedures in the
transaction documents, unspecified compensatory and/or rescissory damages, interest and costs. On April 3, 2015, the court
granted in part and denied in part the Company’s motion to dismiss the complaint.
On September 19, 2014, Financial Guaranty Insurance Company (“FGIC”) filed a complaint against the Company in the
Supreme Court of NY, styled Financial Guaranty Insurance Company v. Morgan Stanley ABS Capital I Inc. et al. The
complaint asserts claims for breach of contract and alleges, among other things, that the net interest margin securities
(“NIMS”) in the trust breached various representations and warranties. FGIC issued a financial guaranty policy with respect
to certain notes that had an original balance of approximately $475 million. The complaint seeks, among other relief, specific
performance of the NIM breach remedy procedures in the transaction documents, unspecified damages, reimbursement of
certain payments made pursuant to the transaction documents, attorneys’ fees and interest. On November 24, 2014, the
Company filed a motion to dismiss the complaint.
On September 23, 2014, FGIC filed a complaint against the Company in the Supreme Court of NY styled Financial
Guaranty Insurance Company v. Morgan Stanley ABS Capital I Inc. et al. The complaint asserts claims for breach of contract
and fraudulent inducement and alleges, among other things, that the loans in the trust breached various representations and
warranties and defendants made untrue statements and material omissions to induce FGIC to issue a financial guaranty policy
on certain classes of certificates that had an original balance of approximately $876 million. The complaint seeks, among
other relief, specific performance of the loan breach remedy procedures in the transaction documents, compensatory,
consequential and punitive damages, attorneys’ fees and interest. On November 24, 2014, the Company filed a motion to
dismiss the complaint.
On January 23, 2015, Deutsche Bank National Trust Company, in its capacity as trustee, filed a complaint against the
Company styled Deutsche Bank National Trust Company solely in its capacity as Trustee of the Morgan Stanley ABS Capital
I Inc. Trust 2007-NC4 v. Morgan Stanley Mortgage Capital Holdings LLC as Successor-by-Merger to Morgan Stanley
Mortgage Capital Inc., and Morgan Stanley ABS Capital I Inc., pending in the Supreme Court of NY. The complaint asserts
claims for breach of contract and alleges, among other things, that the loans in the trust, which had an original principal
balance of approximately $1.05 billion, breached various representations and warranties. The complaint seeks, among other
relief, specific performance of the loan breach remedy procedures in the transaction documents, compensatory,
consequential, rescissory, equitable and punitive damages, attorneys’ fees, costs and other related expenses, and interest. On
October 20, 2015, the court granted in part and denied in part the Company’s motion to dismiss the complaint.
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