By Jonathan Stempel
NEW YORK (Reuters) - Credit Suisse Group AG
In a filing in New York state court on Monday, MBIA objected to what it called Credit Suisse's failure to turn over "some of the hottest documents" in the 4-1/2-year-old lawsuit, on the ground that they were "non-responsive."
MBIA, based in Armonk, New York, said it learned of the documents only in the last few months, after a court told Credit Suisse to turn over deposition transcripts from other U.S. cases involving similar claims.
Credit Suisse spokesman Drew Benson declined to comment.
The dispute stemmed from a December 2009 lawsuit in which MBIA accused Credit Suisse of fraudulently deceiving it into participating in a mortgage-backed securities transaction that quickly soured, causing the insurer to pay more than $296 million in claims.
Credit Suisse has said the lawsuit lacks merit.
Monday's filings included more than 500 pages of exhibits that MBIA said may support its claim that Credit Suisse hid defects in securitization practices before the financial crisis, reflecting the bank's desire to sell more securities rather than honor its stated policies. Many banks have faced similar claims.
Among the exhibits is an Aug. 21, 2007, email in which a Credit Suisse due diligence official referred to "some terrible decisions or missed calls, magnified by very bad feedback" in a bank business that handled underwriting and due diligence.
Another is an Nov. 22, 2006, email that MBIA said shows a bank official's concern about making "underwriting exceptions" that could result in "liability down the road when the loans go bad and people point out that we violated our own guidelines.
"The fulfillment process is a joke," the email said. "I hate to say it but I think we're either all in as a mortgage company or out completely at this point."
MBIA asked Justice Shirley Werner Kornreich in state court in Manhattan, who oversees the New York case, to order Credit Suisse to conduct a "targeted re-review" of documents to ensure it is turning over evidence properly.
The case is MBIA Insurance Corp. v. Credit Suisse Securities (USA) LLC et al, New York State Supreme Court, New York County, No. 603751/2009.
(Reporting by Jonathan Stempel in New York; Editing by Leslie Adler)