settlement

Goldman Sachs will pay $5 billion to settle both federal and state inquiries into its sale of "shoddy mortgages," AP's Ken Sweet reports. The sum includes $1.8 billion in mortgage forgiveness and refinancing, $2.39 billion in civil penalties and $875 million in cash payments.

The deal is with the U.S. Department of Justice, the New York attorney general, the Illinois attorney genearl and other regulators.

President Barack Obama's administration has agreed to pay $940 million for failing to compensate American Indian tribes for public services like law enforcement that tribes carried out, NPR's Laura Wagner reports. The services are provided by the tribes under the Indian Self Determination Act, but the federal government pays for them. Sometimes the appropriations were not enough.

Financial Services Superintendent Benjamin Lawsky said New York's foreclosure system is "'broken and badly in need of change"' because of delays in the settlement conferences that must be held before houses can be foreclosed, New York Law Journal's Joel Stashenko reports.

The Department of Financial Services found that it takes nine months, on average, from when a foreclosure is filed in New York to when the settlement conferences conclude. The study also found that the biggest reason for delays is the lack of a definition for what it means that homeowners and banks are required to negotiate in good faith. Lawsky called for legislation to more clearly define what negotiation in good faith means.

The U.S. Court of Appeals for the Fifth Circuit ruled earlier this month that British Petroleum has the right to appeal some damage claims awarded in the aftermath of the Gulf oil spill, Reuters' Jonathan Stempel reports.

The circuit court found that the settlement agreement did not resolve claims itself, but established a mechanism for the trial court to resolve claims. As a result, BP can appeal claim determinations by U.S. District Court Judge Carl Barbier.

It is unclear who will pay the fees for the attorneys who have been negotiating settlements of Superstorm Sandy insurance cases, The New York Law Journal's Andrew Keshner reports. The Department of Homeland Security and the Federal Emergency Management Agency say that they are not statutorily authorized to pay legal fees to plaintiffs' lawyers. But insurance carriers don't want to pay the fees out of concern that they could face qui tam whistleblower suits. Eastern District Magistrate Judges Cheryl Pollak, Ramon Reyes, Jr. and Gary Brown, the trio tasked with facilitating case resolution, held a hearing this week to resolve the fee and other issues, Keshner reports. The judges said they would restart mediation if the fee and other issues can't be resolved.

The Appellate Division, First Department, has upheld the $8.5 billion settlement of claims against Bank of America for its involvement with the mortgage crisis, the New York Law Journal's Ben Bedell reports. The appellate panel reversed a lower court judge, who ruled that Bank of New York Mellon, which was the trustee for the pooled mortgage trusts, had abused its discretion in waiving claims that dissident investors said were worth $30 billion to $50 billion. Bank of New York Mellon agreed with the reasoning that investors should not try to force Bank of America to buy back mortgages it had modified.

The federal government will pay the Navajo Nation $554 million to settle claims that it mismanaged funds and natural resources on the Navajo reservation, according to the Wall Street Journal's Dan Frosch. It's highest-ever such settlement in a case about land the federal government held in trust for an American Indian tribe, according to the WSJ. The Obama administration has paid out more than $1 billion "during the past several years to settle lawsuits filed by dozens of tribes who have made similar claims regarding the chronic mismanagement of trust land and resources by the federal government," the WSJ further reports.

The Wall Street Journal reports that Bank of America is going to pay a record settlement of $17 billion over its mortgage lending: "The deal will resolve a government investigation that stems largely from the bank's purchases of Merrill Lynch & Co. and Countrywide Financial Corp. as they teetered in the housing crisis." More than $9 billion is expected to be in cash, WSJ further reports.

Patton Boggs ended its role in the environmental litigation Ecuadorian plaintiffs brought against Chevron, agreeing to pay $15 million to the energy firm and expressing regret for its role in the case, the New York Law Journal reports. An Ecuadorian court rendered a $9.5 billion verdict against Chevron for pollution left in the Amazon, but an American federal judge ruled that plaintiffs attorney Steven Donziger corrupted the Ecuadorian judiciary in an effort to win his case, the Law Journal further reports. Patton Boggs' role included seeking to enforce the judgment around the world.

The New York Times' Campbell Robertson and John Schwartz report today on why BP is now attacking a settlement process for economic-damage legal claims arising out of the Gulf oil spill. The energy firm, however, has not been able to unwind the settlement it agreed to: "While BP has won some arguments in court, its fundamental point — that the settlement has been brazenly misinterpreted to pay claims with no evidence linking them directly to the spill — was batted away in a recent decision in the United States Court of Appeals for the Fifth Circuit. 'There is nothing fundamentally unreasonable about what BP accepted,” Judge Leslie H. Southwick wrote, 'but now wishes it had not,'" The Times also reports.

The settlement allows for payouts for false positives in which businesses can show loss in income, even it was not related to the oil spill, The Times reports. Texas attorney Brent Coon told The Times BP "'underestimated how much law firms would go out and solicit clients. I cannot believe they didn’t appreciate that risk.'"