SETTLEMENT AND REI"EASE AGREEMENT 

This Settlement and Release Agreement ("Agreement") is made as of this 21st 

day of July, 2013, by, between, and among the foJlowing undersigned parties: 

The Plaintiff Federal Deposit Insurance Corporation, as receiver ofBank.United, 

FSB ("FDIC-R"), and James Edward Heyward, an individual d/b/a Etlort Appraisal 

Group ("Heyward"), and James Schuster ("Schuster") (collectively the "Settling 

Defendants"). 

RECITALS 

WHEREAS: 

Prior to May 21, 2009, BankUnited, F.S.B. ("Bank") was a depository institution 

organized and existing under the laws of Caliiornia. 

On May 21, 2009, the Bank was closed by the Office ofTiuift Supervision 

(''OTS") and pursuant to 12 U.S.C. § 182l(c), the FDIC was appointed receiver. In 

accordance with 12 U.S.C. § 1821(d), the FDIC as receiver succeeded to all rights, titles, 

powers and privileges of the Bank, including those with respect to its assets. 

Among the assets to which the FDIC as receiver succeeded were any and a] I of 

the Bank's claims, demands, and causes of actions against third pat1y appraisers. 

On or about August 14, 2007, Bank funded a mortgage refinance loan in the 

amount of$1,500,000 (the "Loan") secured by real property located in Woodland Hills, 

California (the "Property''). 

On May 15, 2012, the FDIC-R filed a complaint for money dan1ages against the 

Settling Defendants. Those claims for damages are now pending in the United States 

District Court for the Central District of California in FDIC v. Heyward, Case No. cv-12-

00786-JST (the "Action"). The Settling Defendants have denied liability in the Action. 

Schustet· purchased certain policies of insurance from The Navigator's Group, 

Inc. ("Navigators") that Schuster claims provide, or are alleged by Schuster to provide, 

insurance coverage to Schuster. 

Heyward pul'chased certain policies of insurance from American International 

Group, lnc. ("AIG") that Heyward claims provide, or arc alleged by Heyward to provide, 

insurance coverage to Heyward. 

Schuster made a claim against Heyward for contribution and indemnity based 

upon the FDIC-R allegations in the Action and tendered a claim to AIG ("Contribution 

Claims"). 
The undersigned parties deem it in their best interests to enter into this Agreement 

to avoid the uncertainty, trouble, and expense of further litigation. 

NOW, THEREFORE, in consideration ofthe promises, undertakings, payments, 

and releases stated herein, the sufficiency of which consideration is hereby 

acknowledged, the undersigned pm1ics agree, each with the other, as follows: 

SECTION 1: 'Payment to FDIC-R 

A. As an essential covenant and condition to this Agreement, the Settling 

Defendants, collectively, agree to pay the FDIC-R the sum of$300,000("the Settlement 

Funds"), as follows: ( 1) $245,000 paid by or on behalf of Heyward by AIG and 

(2) $55,000 paid by Navigator's Group, Inc. on behalf of Schuster. 

B. Within 30 days of the execution of an original, or originals in counterpart, 

of this Agreement by each of the undersigned Parties to this Agreement, the Settlement 

Funds shall be delivered to FDIC-R by check made payable to the Mortgage Recovery 

Law Group Client Trust Account and delivered to counsel for the FDIC-R. 

C. In addition, and without waiving any other rights that the FDIC-R may 

have, in the event that all Settlement Funds arc not received per this Agreement, then, 

with respect to the Party, or Parties, that fail to deliver their share of the Settlement Funds 

only, the FDIC-R, in its sole discretion, shaH have the right at any time prior to receipt of 

all Settlement Funds to extend this Agreement for any period of time until it receives all 

Settlement Funds and/or shall have the right to enforce this Agreement against the Party 

or Parties, failing to deliver their share of the Settlement Funds, in which event the nondelivering Party, or Parties, agree to jurisdiction in Federal District Com1 in 

California. Any decision by the FDIC-R to extend the tenns of this Agreement or to 

accept a portion of the Settlement Funds shall not prejudice its rights to enforce the tenns of this Settlement Agreement. The failure of one Party to deliver its share of the 

Settlement Funds shall not affect the validity of this Agreement with respect to a Party 

that has delivered its share of the Settlement Funds. 

D. The settlement funds herein arc severable and not joint. A settlement 

payment by one party will entitle that paying party to a release and dismissal. as 

discussed below, even if the other patty has failed to pay its respective amotmt. 

SECTION II: Stipulation and .Dismissal 

Upon execution of this Agreement by each of the undersigned Parties, and receipt 

of the Settlement Funds, the FDIC-R shall dismiss the Action. The undersigned parties 

agree to enter stipulatiun(s) providing that the dismissal(s) set forth above shall be with 

prejudice, with each pa11y to bear its own fees and costs as these were originally 

incurred. 
SECTION III! Releases 

A. Release of Individual Settling Defendants by FDIC-R. 

Eiicctivc upon receipt in full of the settlement funds and dismissal described in 

SECTIONS I and li above, and except as provided in PARAGRAPH III.D., the FDIC-R, 

for itself and its successors and assigns, hereby releases and discharges each of the 

Settling Defendants and their respective heirs, executors, administrators, representatives, 

insurers, successors and assigns, from any and all claims, demands, obligations, damages, 

actions, and causes of action, direct or indirect, in law or in equity, belonging to the 

FDIC-R, that arise from or relate to, the performance, nonperformance, or manner of 

performance of the Settling Defendants' respective functions, duties and actions as 

appraisers related to the loans at issue in the Action including without limitation the 

causes of action alleged in the Action. 

B. Release ofFDIC-R by the Settling Defendm1ts._ 

Effective simultaneously with the release granted in PARAGRAPH Tfl.A. above, 

the Settling Defendants, on behalf of themselves individually, and their respective heirs, 

executors, administrators, agents, representatives, successors and assigns, hereby release 

and discharge FDIC-R, and its employees, officers, directors, representatives, successors 

and assigns, from any and all claims, demands, obligations, damages, actions, and causes 

of action, direct or indirect, in law or in equity, that arise from or relate to, the Bank or to 

the pcrf01mancc, nonperformance, or manner of performance of the Settling Defendants• 

respective functions, duties and actions as appraisers related to the loans at issue in the 

Action including without limitation the causes of action alleged in the Action. 

C. Release by Settling Defendants of Each Other. 

Effective upon receipt in ful1 of the settlement funds and dismissal described in 

SECTIONS I and 11 above, and except as provided in PARAGRAPH m:.D., Heyward and 

Schuster, on behalf of themselves and their respective heirs, executors, administrators, 

predecessors, successors, spouses, families, agents, servants, employees, employers, 

officers, partners, principals, owners, stockholders, directors, representatives, affiliates, 

joint venturers, insurers, assigns and any and all of their as~igncd, affiliated or related 

persons or entities of any type or nature whatsoever hereby irrevocably and 

unconditionally release and forever discharge each otht:r and each of their respective 

heirs, executors, administrators, predecessors, successors, spouses, families, agents, 

s~rvants, employees, employers, officers, partners, principals, owners, :stockholders, 

directors, representatives, insurers (including, AIG and Navigators, subject to the 

payment of the settlement funds), attorneys, experts, affiliates, joint venturers, 

franchisers, and/or franchisees, assigns, predecessors, successors, and any and all of their 

associated, affiliated or related persons or entities, of any type or nature whatsoever, of 

and from any and all claims, demands, complaints (administrative and civil), causes of 

actions, obligations, liens, damages, losses, costs, attorney's fees, and expenses of every 

kind and nature, at law or in equity, direct or derivative, known or unknown, fixed, 
liquidated or contingent, tort, contract, statutory or mixed, which either of them ever had, 

may now have or may hcrcaf1er have aguinst each other by reason of any act or 

omission, matter, cause or thing arising out of or connected with the Action, the 

prosecution of the Action and the defense, handling or settlement of the Action as well as 

any and all matters or issues raised or which could have been raised, or in the future 

might have been raised in the Action, relating to the Property, the Lmm, Bank and the 

Contribution Claim. 

D. .E~_P.ress Reservations F:_rom Releases By FDIC-R. 

1. Notwithstanding any other provision, by this Agreement, the FDJC-R 

does not release, and expressly preserves fully and to the same extent as if the Agreement 

had not been executed, any claims or causes of action: 

a. against the Settling Defendants or any other person or entity for 

liability, if any, incurred as the maker, endorser or guarantor of any promissory note or 

indebtedness payable or owed by them to the FDIC-R, the Bank, other financial 

institutions, or any other person or entity, including without limitation any claims 

acquired by FOIC-R as successor in interest to the Bank or any person or entity other 

than Bank; 

b. against any person or entity not expressly released in this 

Agreement; and 

c. which are not expressly released in Paragraphs liT. A, above. 

2. Notwithstanding any other provision, nothing in this Agreement shall 

be construed or interpreted as limiting, waiving, releasing or compromis:ing the 

jmisdiction and authority of the FDIC in the exercise of its supervisory or regulatory 

authority or to diminish its ability to institute administrative enforcement proceedings 

seeking removal, prohibition or any other administrative enforcement action which may 

arise by operation of law, rule or regulation. 

3. Notwithstanding any other provision, this Agreement does not purport 

to waive, or intend to waive, any claims which could be bwught by the United States 

through either tJJe Department of Justice, the United States Attorney's Office for the 

Central District of California or any other federal judicial district. In addition, the FDICR specifically reserves the right to seck court order~d restitution pursuant to the relevant 

provisions of the Victim and Witness Protection Act, 18 U.S. C. § 3663, et. seq., if 

appropriate. 

SECTION V: .Representations and Acknowledgements 

A. No Admission of Liability. The undersigned parties each acknowledge 

and agree that the matters set forth in this Agreement constitute the settlement and 

compromise of di!>'Pul.ed claims, and that this Agreement is not an admission or evid enc~ 
ofliability by any ofthem regarding any claim, including but not limited to the 

allegations made in the Action. 

B. Execution in Counterparts. This Agreement may be executed in 

counterpruis by one or more of the parties named herein and all such counterparts when 

so executed shall together constitute the final Agreement, as if one document had been 

signed by all pm1ies hereto; and each such COW1terpa.rt. upon exccutjon and delivery, shall 

be deemed a complete original, binding the party or parties subscribed thereto upon the 

execution by all parties to this Agreement. 

C. Binding Effect. Each of the undersigned persons represents and warrants 

that they arc a party hereto or are authorized to sign this Agreement on behalf of the 

respective party, and that they have the full power and authority to bind such patty to 

each and every provision of Lhis Agreement. This Agreement shall be binding upon and 

inure to the benefit of the undersigned parties and their respel;tive heirs, executors, 

administrators, representatives, successors and assigns. 

D. Choice of Law. This Agreement shall be interpreted, construed and 

enforced according to applicable federal law, or in its absence, the laws of the State of 

California. 

E. Entire Agreement and Amendments. This Agreement constitutes the 

entire agreement and understanding between and among the undersigned parties 

concerning the matters set forth herein. This Agreement may not be amended or 

modified except by another written instrument signed by the party or parties to be bound 

thereby, or by their respective authorized attorney(s) or other representative(s). 

F. Reasonable Cooperation. 

1. The undersigned parties agree to cooperate in good faith to effectuate 

aH the terms and conditions of this Agreement, .including doing or causing their agents 

and attorneys to do, whatever is reasonably necessary to effectuute the signing, delivery, 

execution, filing, recording, and entry, of any documents necessary to conclude the 

Action, and to otherwise perfonn the terms of this Agreement. 

2. Fmther, the Settling Defendants agree to cooperate fully with the 

FDIC-R in connection with any action required under this Agreement. Any such 

cooperation that involves any out of pocket costs is subject to reasonable reimbursement 

by the FDIC-R pursuant to its internal guidelines and policy for such reimbursement. 

G. Advice of Counsd. Each party hereby acknowledges that it has con!)ulted 

with and obtained the advice of counsel prior to executing this Agreement, and that this 

Agreement has been explained to that party by his or her counsel. 
(b)(6) __ _ 

H. .G.1:1lifornia Civil Code§ 1542 Waiver. The Parties aclmowledge that they 

have been advised by legal counsel and are familiar with the provision of California Civil 

Code Section 1542, which provides as follows: 

" I\ GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH 

THR CREDITOR DOES NOT KNOW OR EXPECT TO EXIST TN 

l-HS/HER FAVOR AT THE TIME OF EXECUTING THE RELEASE 

WHICH, IF KNOWN BY HIM/HER MUST HAVE MATEI.UALL Y 

AFFECTED HIS/HER SETTLEMENT WITH THE DEBTOR." 

The parties expressly waive and relinquish any and all rights or benefits ·they may have 

under, or which may be conferred upon them by, the provisions of Section 1542 of the 

California Civil Code to the fullest extent that they may lawfully waive such rights or 

benefits pertaining to the subject matter of this release. 

I. Notices. Any notices required hereunder shall be sent by registered mail, 

first class, return receipt requested, and may also be sent by email, to the following: 

If to the FDIC-R: 

Pau} Levin 

Mortgage Recovery 1 ,aw Group 

700 Nm1h Brand Boulevard, Suite 830 

GlendaJe, California 91203 

(818) 630-7901 

L-------

If to James Heyward, d/b/a Effort Appraisals, and/or AIG: 

Rinat Klier-Erlich, Esq. 

Manning & Kass Ellrod Ramirez Trester 

801 S. Figueroa St, 151h Floor 

Los Angeles, CA 900 17 

(b )(6)'--- tl ~=21=3)=6=24= --~6=9:....oo __ _j 

lfto James Schuster, and/or Navigators: 

Ari L. Markow, Rsq. 

Spile, Leff & Goor, LLP 

16501 Ventura Blvd. 

Encino, CA 91436 

(818) 784-6899 

(b )(6) ....................................... .... Jt;;;;;; ······=·········=·········;;_·· ____ ___. 

J. Assumption of RJsk of Differences in Facts. Other than 

the representations and warranties made herein, each of the Parties acknowledges thal, if 
the facts with respect to which this Agreement ·are executed are found hereafter to be 

different from the facts in that connection nowbclicved by them to be true, each 

expressly acc!':!pts and a'!sumcs the risk of such possible difference~ in 'facts, lind agrees 

that this Agreement shall be, and shall remain, effective, notwithstanding 

such differences in. facts, 

K. No Reliance. The .Parties hereto and eaqh Qfthem represent and declare 

that in executing this Agreement, they rely solely. upon their pwn judgmcn(, belief and. 

knowledge; and that they ·have not been intluenced to ·a:ny extent what:soever in executing 

the same by any of the Parties hereto or by any pers.on representing them) or ~my of 

them.. · 

IN WITNESS WHEREOF, the parties hereto h.ave caused this Agreement to be 

executed by each of them or their duly authorized representatives on the dates hereinafter 

subscribed. 

FEDJ.:RAL DEPOSIT INSURANCE 

CORPORATION 

(b )(6)._ ........................... ··················· nate:.~--szi f(~CJ s~L.. · .,.. ...... ...... ,.,. ......... _ ..... ... _ ... ______ ___. 

Tass D. Waterston 

SeniO.r Attorney 

Date: __ JAMES EDW ARD'HEYW,ARD, d/b/a EFFORT 

APPRAISAL GROUP . . 

BY: _ _ _ ___ _ 

James Edward Heyward 

0 

.. 

····---···· ...... . 
...............................................•................. -··· 

................................. ~ ........... ~ ........... , .. 

the f<l<:.ts with resp~ct tn which this Agreement are executed are found hereafter to he 

difftn:::nt from the f~icts in that connection nm.v bd.ieved by thern to be true~ ~:adl 

·:~xp.ri'~s~~ly .?~ccepts and assumes the risk of S'LN.h possible diff~rc~1ces in thcts, and agrees 41'"' • '·I>; S i\ "!'" .... .,.11"" ,.,. •. c• t, •>JI. 'r• ~ .. , . .,.; c.·j· ''' I l., .•. l.i1 ''; '1 .,.,~~~-'('1.: V"' I' ··)h• ,.'1 ~ h t:•·•···t"' -~ ], " ... , l.li.<••l· < 1.1 •. 1:' -~, ;;..~ •. > •. · !lw.l!.l. -:.>1..«:. . L ~, ;:. '" ,-, .,1{,,.; ·'-· .. (H.< > -..I. <;,. , J. .·,"~ . d • n· .> >><.<: •·>.U nb 

such d.ifJcrcnce.s in faets. 

K. No 1~.diancc. The Parties hereto and each of them represent and dedm(:. 

Ht(lt in executing this .A.gr~~ernent, (hey rely sokly up-on their \)Wn judgment, belief ~::nd 

knowkdg~~ ~.nd that they hii:\ve not been infl.u•.tnced tn any extent whatst.ever in exte:uting 

'it'' ~·~>WI<> !)" ''P'V ,.,,r-1·L. ··~ p~.,..-f.; ·:~~ j~ . .,.,..,,.!.,) ')f b" "'l'-~1 ""C""'Ofl ft1!1'\f"'~''nt1' ,..,i)· ;·h"m; "',. ~'.,.." .,,f·· L. C .. :h.,,>..t ... v L . ..." <~ .. u«' ,,,.rl .. JH... ~.(,tt~t._ .. ft;t.~~.•~· i. .. ,.,..- a. ;;,J .t' ~.) . ""J;6 v ...... ~ ~· -tte. ~AJC.: ~ ~ ,.,. ..;•H·J ~ .... 

them. 

FEDERAL nEPOST'l' lNSURANCB 

CORPORA'riON 

(b )(6) IJiif~~; ~,~ ,:;},~ r:r:;;/~;:·~:~r?? 13~;-:l·········· .. ······-~-.--· --- ~-~~------------.....1 

Tass D. Warerston 

Senior AJtorney 

JA~vfES EDWARD HEYWARD, dih/a EFFOR'r 

.APPRAISAL GROUt~ 

JAMES SCHUSTER