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Several recent New York cases involving securitized-mortgage trusts have dealt setbacks to the trusts seeking to enforce contractual rights against the sellers of the mortgages for breach of warranties. See, e.g., Lehman XS Trust, Series 2006-4N, by U.S. Bank, as Trustee v. Greenpoint Mortgage Funding, 2014 WL 108523 (S.D.N.Y. 2014); Home Equity Asset Trust 2007-1 v. DLJ Mortgage Capital, 2013 WL 6997183 (N.Y. Sup. Court, Jan. 15, 2014); Home Equity Asset Trust 2006-5 (Heat 2006-5) v. DLJ Mortgage Capital, 2014 WL 27961 (N.Y. Sup. Court, Jan. 3, 2014); ACE Securities v. DB Structured Products, 977 N.Y.S.2d 229, 112 A.D.3d 522 (1st Dept. 2013) (reversing denial of motion to dismiss by the trial court); Nomura Asset Acceptance Corporation Alternative Loan Trust, Series 2005-S4, by HSBC Bank USA, as Trustee v. Nomura Credit & Capital, 2013 WL 2072817 (N.Y. Sup. Ct. May 10, 2013). Almost unanimously, the courts have been holding that such suits by the trusts are barred by the applicable six-year statute of limitations on breach of contract actions despite contractual language that purports to establish the accrual of the claims not at the time the warranties are made but at a later period. To the extent the decisions are upheld on appeal, they may signal the tail end of the exposure faced by the sellers of the mortgages to the trusts for breach of warranties regarding the credit quality of the mortgages sold prior to the financial crisis of 2008, the peak of sales activity and perceived abuses in connection with such sales.1

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