Opinion ID: 3172574
Heading Depth: 2
Heading Rank: 1

Heading: The Loan Sales and the Lawsuits

Text: All of the claims were brought against two originators of home loans: Standard Pacific Mortgage, Inc. and Universal American Mortgage Company, LLC. In 2004, Standard Pacific agreed to sell residential mortgage loans to Lehman Bank. Similarly, in 2005 and 2006, Universal 4 American agreed to sell residential mortgage loans to Lehman Bank. Each agreement was memorialized in two documents: a Loan Purchase Agreement and a Seller’s Guide. The Loan Purchase Agreements incorporated the Seller’s Guides.
One of the appellants, Lehman Holdings, appeals from dispositions on claims involving five loans that Universal American sold in 2006 to Lehman Bank. Lehman Bank sold the loans and assigned the contractual rights to Lehman Holdings, which then sold the loans to either the Federal Home Loan Mortgage Corporation (commonly known as Freddie Mac) or the Federal National Mortgage Association (commonly known as Fannie Mae). Freddie Mac and Fannie Mae eventually determined that the five loans were unacceptable and demanded payment from Lehman Holdings. Lehman Holdings complied, then brought five suits in 2011 against Universal American for breach of contract. In each case, the district court 5 granted summary judgment to Universal American based on expiration of the period of limitations.
Aurora’s suit is similar. Aurora bought ten loans from Standard Pacific in 2006 and 2007. (As noted above, Aurora was known at the time of purchase as Lehman Brothers Bank.) In November 2012, Aurora sued Standard Pacific for breach of contract. The district court granted Standard Pacific’s motion to dismiss based on expiration of the limitations period.