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Former Thornburg to collect $23 million with approved Barclays deal
By Kali Hays
New York, Sept. 23 – Joel I. Sher, the Chapter 7 trustee for TMST, Inc., formerly Thornburg Mortgage, Inc., obtained approval of a $23 million settlement payment from Barclays Capital Inc., according to a Sept. 22 order from the U.S. Bankruptcy Court for the District of Maryland.
As previously reported, Sher filed a complaint against Barclays in April 2011 alleging damages sustained by TMST after Barclays’ declaration of default in August 2007 and its liquidation of securities subject to a repurchase agreement with TMST.
After Barclays denied the trustee’s claims, the parties entered into litigation, which led to ordered mediation and negotiations resulting in Barclays’ agreement to pay TMST $23 million for the release of claims and dismissal of any pending litigation, according to the motion.
Sher said that the settlement benefits the estate by preventing the expense of further complex litigation and any difficulties that would be encountered in collecting payment from Barclays.
TMST is a Santa Fe, N.M.-based lender specializing in jumbo mortgages. It filed for bankruptcy on May 1, 2009 under Chapter 11 case number 09-17787.
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