On October 10, the Bank of New York Mellon, suing as trustee for the J.P. Morgan Mortgage Acquisition Trust, Series 2006-WMC3 trust, filed a summons with notice in the Supreme Court for the State of New York against WMC Mortgage LLC, J.P. Morgan Mortgage Acquisition Corp., and JPMorgan Chase Bank. The trustee alleges that the defendants breached contractual representations and warranties and discovered such breaches during origination, due diligence, and servicing of the loans, but failed to adhere to their notice and repurchase obligations with respect to at least 334 of mortgage loans in the $959 million RMBS trust. Bank of New York Mellon also asserts that JPMorgan Chase Bank, as servicer, breached its servicing obligations through, among other things, ineffective collection activities, delays in foreclosure, and improper modifications. The trustee seeks damages of no less than $475 million related to the alleged contractual breaches, rescissory damages, an order of specific performance of repurchase, reimbursement of expenses, and pre- and post-judgment interest. Summons with Notice.
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