The National Law Journal reports that California’s Impac Secured Assets issued proceedings last week alleging that SNR Denton acted too slowly in correcting a 2007 Securities and Exchange Commission filing – a delay which, Impac claims, led to a Citigroup lawsuit against the company.

Debt securities

The lawsuit centres on lawyer Richard Simonds, who was instructed by Impac in 2007, when he was at now-dissolved Thacher Proffitt & Wood, to file SEC documents regarding the sale of mortgage-backed securities. The claim alleges that Mr Simonds – not named as a defendant in Impac’s action – failed to include a provision on debt securities.
The alleged mistake was not noticed until January 2010 when Impac discovered an unrelated SEC filing error and asked Mr Simonds – now at SNR Denton – to check the 2007 filing. The suit then alleges that Mr Simonds and SNR Denton discovered the 2007 mistake, and in March 2010 alerted Impac. In April 2010, Mr Simonds and SNR Denton advised Impac to amend the filing, which they did.

Millions lost

However, Citigroup had bought around $7m in Impac’s mortgage-backed securities in March 2010 and – because of the SEC filing mistake – allegedly lost millions of dollars. Citigroup sued Impac in May 2011, winning summary judgment in May 2012 on most of its claims.
According to the Journal report, Impac’s law suit against SNR seeks indemnity against Citigroup’s claims and a declaration that the law firm is responsible to Citigroup.
An SNR Denton spokesman said: ‘We stand behind the advice and counsel provided in this matter and look forward to a successful resolution of the case.’ Impac’s representative Mark Eisenhut – a partner at Californian law firm Call & Jensen – declined to comment.