March 21, 2013
SIFMA and The Clearing House Brief in Support of The Bank of New York Mellon
Cadwalader, Wickersham & Taft LLP (Cadwalader), a leading counselor to global financial institutions and corporations, is representing The Securities Industry and Financial Markets Association (SIFMA) and The Clearing House Association L.L.C. in their opposition to the retroactive imposition of unanticipated duties and liabilities on transaction parties in the mortgage-backed securities (MBS) market. The two significant financial services industry organizations filed the amicus curiae brief on March 4.
Represented by Cadwalader partner Martin L. Seidel and special counsel Nathan M. Bull, SIFMA and The Clearing House are supporting a petition for an interlocutory appeal to the United States Court of Appeals for the Second Circuit of the April 3, 2012 order (The Order), which applies the Trust Indenture Act of 1939 (TIA) to SEC-registered mortgage passed-through certificates. Members of SIFMA and The Clearing House include financial services industry firms, including The Bank of New York Mellon (BNYM) and its affiliates.
On the subject of the brief, Mr. Seidel commented, "We support BNYM in its petition for an appeal. The Order contradicts the understanding of nearly four decades that TIA is not applicable to mortgage pass-through certificates. A definite resolution against The Order will absolve the uncertainty in the MBS market and financial services industry at large.”
SIFMA and The Clearing House have a significant role in the MBS market as trustees, issuers, servicers, market-makers and investors. If the appeal is granted, BNYM will have the authority to challenge the April 3, 2012 order.
The full amicus brief can be found here.