|Credit Union Journal|
A federal judge Friday dismissed claims by senior
The ruling came as Judge
The role of Wu, who also is presiding over another suit by NCUA against
But Wu’s role is critical in the NCUA cases for another reason. The WesCorp defendants say NCUA cannot plausibly claim that the cause of the giant corporate failure was their fault and also claim the failure was caused by the
According to one lawyer, who declined to be quoted because his client’s case is still before the court, the mediator, who was not Wu, suggested several times that NCUA is hurting its own cases by pursuing the WesCorp claims, especially since there is no insurance money to pay damages even if NCUA wins its WesCorp suit.
Wu is a 62-year-old
Meantime, NCUA last week agreed to settle its claims against a second WesCorp figure,
As part of their defense the WesCorp figures argued that NCUA, which had an on-site examiner at the corporate five days a week, approved of and knew of WesCorp’s investment strategies and activity and that the NCUA Board itself had voted numerous times to waive its investment rules to allow WesCorp to invest in risky MBS. But Wu on Friday dismissed that defense. “By striking these affirmative defenses, the Court does not preclude the Officer Defendants from offering evidence of the NCUA’s statements and conduct to the extent that such evidence is relevant to the issue of whether the Officer defendants breached their fiduciary duties, as alleged by NCUA,” ruled Wu.
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