Talcott Franklin P.C. Recommends Adoption of Settlement Agreement in ResCap Bankruptcy

DALLAS, May 14, 2012 /PRNewswire/ -- Financial crisis litigation boutique Talcott Franklin P.C. today recommended that its clients enter into a settlement agreement with Residential Capital, LLC and its direct and indirect subsidiaries (ResCap) and Ally Financial Inc. and its direct and indirect subsidiaries (Ally) as part of ResCap's pre-arranged bankruptcy filing. The firm intends to work with its clients to direct the Trustees of various ResCap-sponsored residential mortgage backed securities (RMBS) trusts to support the plan of reorganization.

The firm is famous for its RMBS investor clearing house, which represents over half of the outstanding issuance of private-label RMBS. A sub-set of roughly 30 of the firm's investor clients signed Non-Disclosure Agreements to participate in the negotiation of a settlement. As of late Sunday night, an overwhelming majority of those clients had determined to sign or had signed the settlement agreement. The firm intends to recommend the settlement agreement to its remaining clients holding ResCap-sponsored RMBS.

"For investors in ResCap-sponsored RMBS, the alternatives to the settlement agreement are unattractive," said Paul Snyder, the mortgage-backed securities trial lawyer who led the ResCap initiative for Talcott Franklin P.C. "The plan seeks to preserve the continuity of cash flow distribution to the RMBS investors. We intend to support the plan and will now work to instruct the Trustees on our participating clients' trusts to support the plan."

The firm's clients are also represented in this matter by James Gadsden and Leonardo Trivigno of Carter Ledyard & Milburn LLP and Thomas Sarb and Robert Wolford of Miller, Johnson, Snell & Cummiskey, P.L.C.

ResCap is represented by Gary Lee, Jamie Levitt, Tony Princi, and Larren Nashelsky of Morrison & Foerster LLP. Ally is represented by Rick Cieri, Ray Schrock, Steven Hessler, and Noah Ornstein of Kirkland & Ellis LLP.

Jerry Phelps, Derek Witte, Sheri Deterling, and Tal Franklin also participated in the direct negotiations with ResCap and Ally on behalf of Talcott Franklin P.C.

Contact: Ginger Cavanaugh
(704) 246-3896
[email protected]

SOURCE Talcott Franklin P.C.

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