Residential mortgage loan work for ResCap Liquidating Trust
Karl Snow was retained as a testifying expert on behalf of Residential Funding Company, LLC (RFC) and the ResCap Liquidating Trust in a number of lawsuits consolidated in Minnesota and New York courts. RFC was in the business of acquiring and securitizing residential mortgage loans before it filed for bankruptcy in 2012, and it alleged that mortgage originators sold it billions of dollars of defective loans that breached their representations and warranties. As part of his analysis, Dr. Snow proposed and implemented a sampling protocol to assess mortgage loan defect rates for individual defendants, which were used to help establish liability and calculate damages. In the first of the lawsuits to go to trial in 2018, ResCap Liquidating Trust v. Home Loan Center, the jury returned a verdict in favor of ResCap, ultimately awarding $28.7 million in damages (see press coverage from the Wall Street Journal and Law360). In a second trial in 2020, ResCap Liquidating Trust v. Primary Residential Mortg., Inc., Dr. Snow testified on the defect rates and associated damages arising from PRMI’s sale of defective mortgage loans to ResCap. While a decision in this matter is forthcoming, any damages awarded in this action will add to the recoveries in settled actions that have thus far netted over $1.2 billion for the Trust.