Excerpts from the depositions - Wall Street Journal

Case 2:11-cv-10549-MRP-MAN Document 254-1 Filed 03/28/13 Page 4 of 35 Page ID
#:16593
• “Q. Based on your experience in the business world and your role as lead negotiator for
AIG, did you believe that AIG was transferring its rights to bring fraud, or fraud
claims―its rights to bring fraud claims to ML II? A. Absolutely not. I mean, it’s―we
were working collaboratively, and those issues just weren’t discussed and/or
transferred as far as our final document and final agreement.” 86:4–14.
• “Q. Mr. Swift, based on all of the facts that you are aware of and your experience both as
a businessman and lead negotiator for AIG, are you firm in your conviction that AIG did
not transfer fraud claims to ML II? A. Absolutely. [Objections] A. We did not
negotiate it; we did not intend to transfer it. And we were working, you know,
collaboratively with the Fed and we talked about everything that was significant, we
had a transparent discussion, they had their interest, we had ours. But this was
never, ever discussed.” 127:4–21.
Swift testified that he did not believe AIG transferred any fraud claims to ML II.
• “Q. What is your understanding regarding whether or not the Asset Purchase Agreement
transferred litigation claims from AIG to Maiden Lane II? [Objection] A. Again, as
we―as we negotiated the tax points, as you mentioned before, or the residual equity
interest, you know, that the five-sixth, one-sixth split, as we talked with, you know,
the Finance Committee, the regulators, we did not talk about, you know, litigation
because it really wasn’t a negotiated point. We didn’t believe we were transferring;
we didn’t negotiate a transfer price. We didn’t talk about it because it just
wasn’t―wasn’t part of, you know, the deal terms and conditions that we―we were
trying to solve for.” 60:21–61:15.
• “A. RMBS’s [are] generally made up of multiple of individual mortgages that
go―that are pooled. So, I believe what we were transferring was, you know, the
securities and all the rights, stuff that back-up the mortgages that make up the
RMBS security. Q. Is it your understanding that AIG was transferring something more
than the securities? [Objection] A. No. I―what I believe we―we negotiated on the
Term Sheet and that we were primarily responsible for was the sale of securities. Q.
Was there anything else besides the securities that AIG was transferring as part of the
Maiden Lane II Asset Purchase Agreement? [Objection] A. It was transferring the
securities and the rights of those securities. I mean, we were conveying to the Fed, in
exchange, you know, for cash, the securities and the rights that securities have
with―with those securities.” 64:2–65:4.
• “A. [W]hen you trade a security, you’re giving up, you know, the economic rights to
the underlying cash flows of it. So, whether it be in a market trade or the trade we
did with the Fed, you know, the―the economics that back up the certificates, you
know, the fees that you had to pay from a mortgage servicing side, the interests, the
principal collections, all that is part of that security that we were selling. Q. And
were there any other rights, besides that collection of rights, that you understood AIG was
selling to Maiden Lane II? A. No, I’m not aware of anything else, and I probably
should have been since, I mean, I was principally responsible for the Term Sheet.”
68:14–69:7.
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