Cal Fed Must Pay Interest, Court Fees in Lawsuit
SANTA ANA — A mortgage company that won a $31.5-million verdict against California Federal Bank and its one-time Orange County building arm was awarded nearly $1.5 million more Friday in interest and court costs.
Weyerhaeuser Mortgage Co. in Woodland Hills won the jury award in June after a trial on its fraud and civil racketeering lawsuit against Cal Fed, a Los Angeles savings and loan. The jury awarded $31.5 million on the fraud claim and $6.5 million on the racketeering claim, which is automatically trebled to $19.5 million. Weyerhaeuser, however, can collect only on one of the claims.
Weyerhaeuser alleged that Cal Fed knew that the S&L;’s Irvine subsidiary, California Communities Inc., was nearly insolvent when it arranged for two loans totaling $24 million from Weyerhaeuser.
Weyerhaeuser lost about $6.5 million on its loans. Two thrifts that also made loans to the Cal Fed unit have since failed.
Orange County Superior Court Judge John H. Smith Jr., who entered final judgment Friday, set Oct. 6 for arguments on defense motions for a new trial.
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