Judge Harold Baer
J.P. Morgan Acquisition Trust 2006-WF1 (Trust) was established by a 2006 pooling and servicing agreement (PSA) under which U.S. Bank was trustee and Wells Fargo Bank acted as securities administrator, master servicer and servicer. On April 12, 2012, Millenium Partners bought 100 percent of the A-3-B class of senior certificates. Through a series of transactions, they were sold to Bank of America on May 16. In its lawsuit alleging violation of the Trust Indenture Act of 1939 (TIA) and breaches of contract and fiduciary duty, Millenium alleged that after the June 27, 2011, distribution date, Wells Fargo unilaterally changed the PSA’s payment termspaying Millenium principal and interest at a pro rata rate along with all senior certificate holdersso that it received $1.8 million less than it was entitled to under the PSA’s prior waterfall structure. The court dismissed all but the TIA claim as against U.S. Bank and Wells Fargo. Among other things, U.S. Bank and Wells Fargo adhered to the only contractual limitation to the PSA’s amendment. In dismissing the TIA claim as against the Trust the court found that the only factual allegations in the complaint concerning insufficient distributions touched only on U.S. Bank and Wells Fargo.
