Royal Park Investments SA/NV has brought a proposed class action against Deutsche Bank National Trust Company on behalf of investors in the following 10 residential mortgage-backed securities:
- First Franklin Mortgage Loan Trust 2006-FF9
- GSR Mortgage Loan Trust 2007-AR2
- HIS Asset Securitization Corporation Trust 2007-WF1
- HarborView Mortgage Loan Trust 2006-8
- Morgan Stanley ABS Capital I Inc. Trust 2007-NC2
- Morgan Stanley ABS Capital I Inc. Trust 2007-NC3
- Morgan Stanley IXIS Real Estate Capital Trust 2006-1
- NovaStar Mortgage Funding Trust, Series 2006-4
- Saxon Asset Securities Trust 2006-2
- Soundview Home Loan Trust 2007-NS1
Alleging breach of contract, unjust enrichment, conversion and breach of trust, among other possible transgressions, the 22-page lawsuit stems from another dispute between the plaintiff and defendant (Royal Park Inv. SA/NV v. Deutsche Bank Nat'l Tr. Co., No. 1:14-cv-04394-AJN-BCM) pending in New York court. Royal Park Investments claims Deutsche Bank has been reimbursing its legal costs for that lawsuit directly from the aforementioned trusts, essentially paying for its defense against allegations it wronged investors by taking funds from those same investors.
The complaint argues Deutsche Bank “is not permitted to receive advancement, reimbursement or indemnification for the legal fees and costs” it racks up related to its prior litigation. “Rather, Deutsche Bank is improperly and illegally financing its defense of the litigation with funds from the very investors that have accused Deutsche Bank of wrongdoing.”
The lawsuit aims for Deutsche Bank to immediately reimburse Royal Park Investments and proposed class members, and seeks to prevent the defendant from engaging in this same conduct in the future.