(Breach of Fiduciary Duty)   (Breach of Contract)   (Negligence and Gross Negligence)   (Negligent Misrepresentations and Omissions)   (Violation of the Trust Indenture Act of 1939, 53 Stat. 1171)   1.  The Duties and Obligations Set Forth in the PSA   24.  The vast majority of residential mortgage loans that Countrywide underwrote and  originated between 2004 and 2008 were resold to investors in the secondary market, either  through whole loan sales or through mortgage backed security securitizations.  Mortgage  securitizations involve the conversion of illiquid whole loans into bond-like instruments that  trade in capital markets.  Mortgage loan “pass-through” securities entitle the investor to  payments from pools of mortgage loans.  Accordingly, the value of a mortgage backed security  depends primarily on the underlying mortgage borrowers’ ability to make principal and interest  payments and, secondarily, on the adequacy of the collateral in the event of default.  If the loans  underlying a Certificate suffer defaults and delinquencies in excess of the assumptions built into  the payment structure, or the underlying properties cannot be sold at sufficient value following  default, Certificate holders suffer greater than expected losses.   26.  The Depositors securitized the pool of mortgage loans in the Covered Trusts so  that the rights to the cash flows from the loans could be sold to the Certificate holders.  The  securitization transactions were structured such that the risk of loss was divided among different  levels of investment, or “tranches.”  Tranches consist of multiple series of related mortgage  backed securities offered as part of the same offering, each with a different level of risk and  reward, including different levels of credit enhancement.  One form of credit enhancement is  overcollateralization, which means that the total principal balance of the mortgage loan in the  pool for a securitization exceeds the aggregate amount of securities issued and sold in the  securitization.  Another example of credit enhancement is excess interest, which means that the  amount of interest collected on the mortgage loans underlying a securitization for each payment  period is expected to be greater than the interest distributable on the Certificates and fees and  expenses payable by the covered trust for that period.   28.  Because these tranches have different claims on the common cash flow generated  by the pool of mortgages, credit rating agencies assign different ratings to them and issuers can  price them differently.  The most senior tranches of the Certificates received “AAA credit ratings  or their equivalent from the three leading ratings agencies, which indicated the lowest risk and  highest quality.   29.  Once the mortgage loans were transferred to the Covered Trusts and the tranches  were established, the Covered Trusts passed securities – the “Certificates” – back to the  Depositors, who became the issuers of the Certificates.  The Depositors then passed the  Certificates to Countrywide Securities and one or more other underwriters, who in turn offered  the Certificates to investors in exchange for cash that was then passed back to the Depositors,  minus any fees owed to the underwriters.  Following the sale of the Certificates, Countrywide  Home Loan Servicing LP was responsible for the collection of borrower payments, which were  then sent to BNY Mellon as trustee for the Covered Trusts so that they could be distributed to the  Certificate holders in accordance with the tranche structure.  B.  BNY Mellon’s Role as Trustee for the Covered Trusts   31.  The PSA provides in its “Preliminary Statement” that “The Depositor is the owner  of the Trust Fund that is hereby conveyed to the Trustee [BNY Mellon] in return for the  Certificates.”  The PSA defines “Trust Fund” as:  “The corpus of the trust created hereunder  consisting of . . . the Mortgage Loans and all interest and principal received on or with respect  thereto . . . .”  The PSA defines “Mortgage Loans” as “the mortgage loans as from time to time  are transferred and assigned to the Trustee [BNY Mellon] pursuant to the provisions hereof and  any Supplemental Transfer Agreement, and that are held as a part of the Trust Fund.”  a.  The Conveyance of the Mortgage Loans to BNY Mellon and the  Duty to Take Physical Possession of the Mortgage Loans   33.  In addition, Section 2.02 of the PSA (“Acceptance by Trustee of the Mortgage  Loans”) provides that BNY Mellon is required to take physical possession of the mortgage loans  and the accompanying loan files for the exclusive use and benefit of all current and future  Certificate holders.  It provides:  (a) The Trustee acknowledges receipt of the documents identified  in the Initial Certification in the form annexed hereto as Exhibit  F-1 and declares that it holds and will hold such documents and  the other documents delivered to it constituting the Mortgage  Files, and that it holds or will hold such other assets as are  included in the Trust Fund, in trust for the exclusive use and  benefit of all present and future Certificate holders.  The Trustee  acknowledges that it will maintain possession of the Mortgage  Notes in the State of California, unless otherwise permitted by the  Rating Agencies.  [Emphasis added.]   35.  BNY Mellon is required by the PSA to take physical possession of these key  documents in the loan files – e.g., the original mortgage note with complete chain of  endorsement from the originator to the BNY Mellon as trustee, the original recorded mortgage,  the duly executed assignment of mortgage, the lender’s title policy, etc. – in order to transfer the  ownership rights to the mortgage loans from Countrywide Home Loans to the Covered Trusts.   This was one of BNY Mellon’s key contractual and fiduciary obligations under the PSA.  b.  The Duty to Review the Loan Files and Identify Files Where the  Documentation Was Missing, Defective or Incomplete   37.  The first step in the certification process was the preparation of the “Initial  Mortgage Certification.”  In the Initial Mortgage Certification, BNY Mellon was required to  acknowledge that it had received and reviewed the two key documents for the mortgage loan:  (1) the original mortgage note with a complete chain of endorsements from the originator to  BNY Mellon as the trustee for the Covered Trusts; and (2) a duly executed assignment of  mortgage.   38.  BNY Mellon was then required to attach to the certification a “Mortgage Loan  Schedule” indentifying those loans for which it had obtained the original mortgage note with  endorsements and a duly executed assignment of mortgage, and a “Schedule A” identifying the  mortgage loans for which it had not obtained the original mortgage note with endorsements or  the assignment of mortgage.  This is spelled out in Section 2.02 of the PSA, which provides:  The Trustee agrees to execute and deliver on the Closing Date to  the Depositor, the Master Servicer and Countrywide . . . an Initial  Certification in the form annexed hereto as Exhibit F-1.  Based on  its review and examination, and only as to the documents  identified in such Initial Certification, the Trustee acknowledges  that such documents appear regular on their face and relate to  such Initial Mortgage Loan.  [Emphasis added.]   66.  The members of the Class are so numerous that joinder of all members is  impractical.  While the exact number of Class members is unknown to Plaintiff at this time and  can only be ascertained though appropriate discovery, Plaintiff believes that there are hundreds  of members in the proposed Class.  Record owners and other members of the Class may be  identified from records maintained by BNY Mellon and may be notified of the pendency of this  action by mail, using the form of notice similar to that customarily used in securities class  actions.   67.  Plaintiff’s claims are typical of the claims of the members of the Class as they all  purchased Certificates based upon contracts substantially in the same form as the PSA in Exhibit  C, and BNY Mellon’s misconduct was substantially the same with respect to all persons  investing in the Covered Trusts, and all members suffered similar harm as a result.  Thus, all  members of the Class are similarly affected by BNY Mellon’s statutory, contractual and  fiduciary breaches, negligence and negligent misrepresentations that are complained of herein.   68.  Plaintiff will fairly and adequately protect the interests of the members of the  Class and has retained counsel competent and experienced in class and mortgage backed  securities litigation.   71.  Plaintiff repeats and realleges each and every allegation set forth in the preceding  paragraphs above as if fully set forth herein.   72.  Congress enacted the Trust Indenture Act of 1939 (“TIA”), 53 Stat. 1171, 15  U.S.C. § 77aaa, et seq., to ensure, among other things, that investors in certificates, bonds, and  similar instruments, have adequate rights against, and receive adequate performance from, the  responsible trustees.  15 U.S.C. § 77bbb.  The PSA underlying and establishing each of the  covered trusts is an “indenture”, and BNY Mellon is an “indenture trustee”, under the TIA.  15  U.S.C. § 77aaa(7), (10).  Moreover, the TIA applies to the PSA, and the related certificates.  15  U.S.C. § 77ddd(a)(1).  BNY Mellon violated multiple provisions of the TIA.   80.  Plaintiff repeats and realleges each and every allegation set forth in the preceding  paragraphs above as if fully set forth herein.   84.  BNY Mellon’s breach of its ministerial duties set forth in the PSA as described  above, reduced collections of the mortgage loans in the Covered Trusts in the collateral in the  pools of loans supporting the Certificates, and caused Plaintiff’s losses on its Certificates, and  diminished their value.   85.  BNY Mellon’s failure, in good faith and with due care, to exercise its rights and  powers under the PSA after there were events of default and Plaintiff’s ability to collect its full  principal and interest became impaired also breached the PSA and caused Plaintiff’s losses.    86.  BNY Mellon is liable to Plaintiff for the losses it suffered as a direct result of  BNY Mellon’s failure to perform its contractual obligations under the PSA.  87.  Plaintiff repeats and realleges each and every allegation set forth in the preceding  paragraphs above as if fully set forth herein.   89.  As set forth in detail above, BNY Mellon breached its fiduciary obligations by  failing to perform these obligations.   90.  The violations by BNY Mellon of its fiduciary obligations impaired Certificate  holders’ ability to fully collect the principal and interest due on their Certificates and caused  losses in the value of Plaintiff’s Certificates.    91.  Plaintiff repeats and realleges each and every allegation set forth in the preceding  paragraphs above as if fully set forth herein.   93.  BNY Mellon’s negligence and gross negligence impaired Certificate holders’  ability to fully collect the principal and interest due on their Certificates and caused losses in  the value of Plaintiff’s Certificates.  94.  Plaintiff repeats and realleges each and every allegation set forth in the preceding  paragraphs above as if fully set forth herein.   96.  Because Plaintiff and the Class could not evaluate the loan files for the mortgage  loans underlying the Certificates, and because Plaintiff and the Class could not examine whether  those files contained complete and accurate documentation for the mortgage loans, they were  heavily reliant on BNY Mellon’s unique and special knowledge regarding the mortgage loans  and the loan files when determining whether or not to make each investment of Certificates, and  whether or not to demand that BNY Mellon exercise its powers under the PSA to require the  other parties to the PSA to satisfy their obligations, including to repurchase or substitute the  defective loans.  Plaintiff and the Class were entirely reliant on BNY Mellon to provide accurate  information regarding the loans and loan files with respect to these matters.   97.  Plaintiff and the Class necessarily relied on BNY Mellon’s unique and special  knowledge regarding the mortgage loans and loan files for those loans in the covered trusts when  determining whether to invest in the Certificates, or to timely exercise their rights to require  parties to the PSA to perform their obligations.  BNY Mellon’s status as the trustee for the  Covered Trusts, coupled with its unique and special knowledge about the underlying loans and  the loan files, created a special relationship of trust, confidence, and dependence between BNY  Mellon and the Plaintiff and the Class.   98.  BNY Mellon, in the exercise of due care, should have been aware that Plaintiff  and the Class relied on its unique and special expertise and experience and depended upon BNY  Mellon for accurate and truthful information.  BNY Mellon also knew that the facts regarding the  mortgage loans and the loan files were exclusively within its knowledge.   A.  The Securitization Process for the Countrywide Certificates  