GE 2014 Annual Report Download - page 139

GE 2014 FORM 10-K 119
LEGAL PROCEEDINGS
magistrate judge. Following this mediation, the parties reached a settlement in principle on the claims arising from a portion of
the loans held in the trust (the “Group 1” loans) , and, as a result, on February 9, 2015 the District Court stayed the case as to
these claims. The second case was initiated by the Federal Housing Finance Agency (FHFA), which filed a summons with
notice in the fourth quarter 2012. In the second quarter 2013, Deutsche Bank, in its role as securitization trustee of the trust at
issue in the case, intervened as a plaintiff and filed a complaint relating to approximately $1,300 million of loans and alleging
losses in excess of approximately $100 million. In December 2013, the District Court issued an order denying WMC’s motion
to dismiss. In February 2015, the District Court on its own motion requested that the parties re-brief several issues raised by
WMC’s motion to dismiss.
The amounts of the claims at issue in these cases (discussed above) reflect the purchase price or unpaid principal balances of
the mortgage loans at issue at the time of purchase and do not give effect to pay downs, accrued interest or fees, or potential
recoveries based upon the underlying collateral. All of the mortgage loans involved in these lawsuits are included in WMC’s
reported claims at December 31, 2014. See Note 2 to the consolidated financial statements in this Form 10-K Report for
additional information.
The company is reporting the following matter in compliance with SEC requirements to disclose environmental proceedings
where the government is a party potentially involving monetary sanctions of $100,000 or greater. In October 2014, the U.S.
Federal Government informed the company that it was seeking penalties under the Clean Air and Resource and Conservation
Recovery Acts in connection with a facility sold to Momentive Performance Materials, Inc. in 2006. The allegations relate to
improper operation of pollution control monitoring equipment by incinerator operators.