Dec. 7 (Bloomberg) -- Goldman Sachs Group Inc. and CIFG Assurance North America Inc. retained a mediator as the two companies seek to settle a lawsuit in New York state court in Manhattan, according to a filing.
The insurer sued Goldman Sachs in New York State Supreme Court in August 2011, accusing the New York-based investment bank of making misrepresentations in connection with the securitization of a portfolio of 6,204 mortgage loans.
The two sides have participated in one mediation session and have scheduled another for Dec. 19, according to a document filed in court yesterday.
Justice O. Peter Sherwood in May granted Goldman Sachs’s motion to dismiss three counts in the lawsuit, including one for fraudulent inducement, while refusing to throw out three claims for breach of contract. He also granted a motion by Buffalo, New York-based M&T Bank Corp. to remove it as a defendant
CIFG and Goldman Sachs appealed Sherwood’s decision, and the judge in July ordered the two sides to engage in mediation, according to court filings.
CIFG filed another lawsuit against Goldman Sachs in the same court this week, accusing the bank of fraudulently inducing the insurer to provide a policy on a credit default swap guaranteeing $325 million of notes in a collateralized debt obligation called Fortius II Funding Ltd.
In a phone interview today, Michael DuVally, a spokesman for Goldman Sachs, declined to comment on yesterday’s filing or the CIFG suit filed this week. Attorneys for CIFG didn’t immediately return voice-mail messages and e-mails seeking comment.
CIFG, based in New York, has taken similar actions in the same court during the past three years, including a $277 million suit against GreenPoint Mortgage Funding Inc. filed in October and a $150 million suit against Bank of America Corp. filed last month.
The case is CIFG Assurance North America Inc. v. Goldman, Sachs & Co., 652286/2011, New York Supreme Court, New York County (Manhattan).
To contact the reporter on this story: Chris Dolmetsch in New York at email@example.com
To contact the editor responsible for this story: Michael Hytha at firstname.lastname@example.org