In the last few days there has been a pair of ridiculous lawsuits that are no doubt a waste of time and money for all involved.
Inquiring minds may wish to consider San Diego sues Bank of America to halt foreclosures.
San Diego’s city attorney Michael Aguirre said on Wednesday he filed a lawsuit against Bank of America Corp (BAC) and its Countrywide unit to prevent the mortgage lenders from foreclosing on homes in the city, which he aims to make a “foreclosure sanctuary.”
Here is my take: This is a needless waste of taxpayer money. All it does is make it look like the city attorneys have work to do.
If this is typical of the “work” San Diego is paying its attorneys to do, San Diego ought to fire the whole lot of them.
Los Angeles In On The Act
In an attempt to see which city can file the most ridiculous lawsuit, Los Angeles Sues MBIA, Ambac, Others Over Bond Insurance.
MBIA Inc., Ambac Financial Group Inc. and four other bond insurers were sued by Los Angeles for allegedly conspiring to maintain a credit-rating system that led local governments to buy “unnecessary” policies on their bonds.
City Attorney Rocky Delgadillo filed the lawsuit yesterday in Los Angeles Superior Court. The second-most populous U.S. city after New York says it seeks to recover damages it sustained by paying “millions” for guarantees that became worthless when the insurers lost their top credit ratings.
Given that bloggers have been warning about MBIA (MBI) and Ambac (ABK) for years, clearly City Attorney Rocky Delgadillo should have been heeding the good advice of Sheila Bair who said she is going to pay more attention to what bloggers are saying. For more on this angle, please see FDIC Chairman Sheila Bair Is Out Of Control.
The fact remains that this is nothing more than a waste of time, and money to file such a lawsuit. Once again, all this lawsuit does is keep a bunch of attorneys busy, at taxpayer expense, when there is no chance of the city from profiting from the lawsuit as it would immediately bankrupt MBIA and Ambac.
Lawsuit or not, it’s all over for both MBIA and Ambac because neither company is going to get much if any business going forward if cities come to the same conclusion as did Los Angeles. And how can Ambac and MBIA stay in business without new business?
Mike “Mish” Shedlock
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