08242011deutsche Complaint

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
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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),
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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.
Document 1
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Page 4 of
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
for the Trusts, WMB made
numerous
representations,
warranties and covenants
regarding the
due execution and
enforceability
of those
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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).
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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
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
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
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
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
to
if it wished to obtain the

to
benefits of the
A Ezreements
by transferring them
jPMC,
or
repudiate
the
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
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
As receiver of WMB, the FDIC is liable for WMB's breaches of contract. In
addition, the
or
FDIC's breaches of the
and its failure to
WMB's breaches
to cure such
breaches in accordance with the
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
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EXHIBIT 1
& Bockius LLP 1717 Main Street, Suite 3200 Dallas, TX 75201 7347
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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
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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
10701777.6
Document 1-2
4
Filed 08/26/2009
Page
6 of 25
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
Document 1-2
5
Filed 08/26/2009
Page
7 of 25
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
Document 1-2
6
Filed 08/26/2009
Page
8 of 25
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
Document 1-2
7
Filed 08/26/2009
Page
9 of 25
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
Document 1-2
8
Filed 08/26/2009
Page
10 of 25
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
Document 1-2
Filed 08/26/2009
Page
11 of 25
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:,
a, -.4..viigaz,
S GOODMAN and GRETCHEN MORGENSON
Hav, yOU
Ett.M.ftwicE6.4.
joined
WS fr
"We
hope
to do to to
this
industry
what Mil-_Also: did to theirs,

to
.tarbucics did
theirs, Costco did
theirs and Lowe's-tiome
PRINT REPRINTS
SH, ARE
nytimes.com
Linked:
()Coq did
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.
NO&
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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.I
supervisor at
i.
Washington
Parsons
was
Mutual mortgage processing center, John D. accustomed to seeing baby sitters claiming
- -71-1:- -4-7r11i:ri:;1(*.';n. ; : '-'1'1:!.' 'fiel';':'

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,

l'he Peg!,
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to
Tailor Medi, ninon 3. ImMlit [Onkel-. et PioLieecii Seek
Recognit Inn
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.
144.4.,,, wasatamennw,eisc...s66.1,
inc;NendlorkTimcs
i
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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Work for Vs
7 of 7
12/30/2008 11:13 AM
Document 1-2
Filed 08/26/2009
Page
19 of 25
Exhibit A-1 To Proof of Claim of

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
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
Document 1-2
Filed 08/26/2009
Page
21 of 25

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
Document 1-2
Filed 08/26/2009
Page
22 of 25
Exhibit A-1 To Proof of Claim of

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
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
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
Document 1-2
Filed 08/26/2009
Page
25 of 25
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
Document 1-3
Filed 08/26/2009
Page 1 of 2
Document 1-3
Filed 08/26/2009
Page 2 of 2

08242011deutsche Complaint

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08242011deutsche Complaint

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Case 1:09-cv-01656-RMC

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

Civil Action No.

JURY TRIAL DEMANDED

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

Plaintiff Deutsche Bank National Trust

banking association organized under the laws

United States of America to carry

principal place of business

Angeles, California, 90071-3175,

site of its trust administration is located at 1761 East

Place, Santa Ana, California, 92705,

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

sometimes referred to hereinafter

"Trustee") under the governing

agreements, custody agreements, and various subsidiary

created, sponsored, and/or

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

between 2000 and 2007, described

collateral, mortgage loans that WMB

and/or sold into the Trusts.

behalf of the Trusts, investors in the

Trusts and itself as Trustee.

The Trusts at issue

"express trusts" created by written instruments manifesting

the express intention to create

setting forth the subject,

purpose, and beneficiaries of

the Trusts. The Trustee therefore

this action pursuant to Federal Rule of Civil Procedure

United States created

Insurance Act, 12 U.S.C.

1811 et seq. and related

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

and/or conservator of banking institutions.

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

JURISDICTION AND VENUE

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

This Court has

jurisdiction over this

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

1367. Jurisdiction also exists in this Court

1349 because the FDIC is

corporation incorporated by an Act

and the United States

Venue is proper in this Court

claim submitted to the FDIC to be

2008, the Trustee timely filed with the FDIC

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

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

A copy of the Proof of Claim is attached

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

whose behalf this action is

hereby incorporates by reference as

with the exhibits thereto and materials referenced therein

the Proof of Claim

the facts referenced therein.

belief, other parties with interests in

with the FDIC,

underwriters, depositors, loan

the claims asserted

Trustee and the Trusts in this action. The

hereby incorporates by reference