Gordian Group was retained by the estate of Heilig-Meyers, as expert witness for the plaintiffs against Bank of America in this precedent-setting litigation regarding this bankrupt furniture retailer, which included analyzing tranches of a securitization of installment sale receivables and which resulted in a full recovery of more than $140 million.
Case Study
Heilig-Meyers
CLIENT: Securitization Plaintiffs
Industries
Consumer/Food/RetailBusiness Profiles
Situation
Bank of America had underwritten various tranches of a securitization of installment sale receivables for Heilig. The securitization was a failure, and investors lost a substantial portion of their investment—despite high ratings from credit agencies.
Engagement
Gordian Group was retained as an expert witness for the plaintiffs in litigation against Bank of America by holders of the Helig-Meyers securitization instruments.Based upon extensive analysis and document review, Gordian determined that high and undisclosed loss rates ate away at the collateral and ultimately caused the trust underlying the securitizations to fail.Henry Owsley produced two expert reports and testified in deposition detailing the analysis he performed that led to these conclusions. In 2008, Henry Owsley testified before a jury in federal court in the Southern District of New York that, based on extensive quantitative analysis, he had determined that these securities were doomed to fail.
Outcome
Owsley’s testimony was an instrumental part of a verdict in favor of the plaintiffs in this case, resulting in a full recovery of more than $140 million.