(Reuters) – American International Group Inc may pursue a lawsuit accusing Bank of America Corp's Countrywide unit of causing billions of dollars of losses by fraudulently inducing it to buy risky residential mortgage-backed securities.
U.S. District Judge Mariana Pfaelzer in Los Angeles on Monday said AIG could pursue claims that Countrywide falsely represented in offering documents that it followed underwriting guidelines, as part of a “company-wide culture of abandonment of underwriting standards and wholesale use of 'exceptions.'”
Pfaelzer dismissed AIG claims related to alleged oral misstatements and negligent misrepresentations. She also allowed AIG to submit an amended complaint.
The case is part of overlapping litigation begun in 2011, when AIG sued Bank of America for $10 billion over activities it said helped trigger its near collapse in 2008 and subsequent $182.3 billion federal bailout.
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