WILMINGTON, Del. — A Delaware bankruptcy judge says investors who are plaintiffs in a federal mortgage-backed securities lawsuit against Washington Mutual cannot file a claim in WaMu's bankruptcy until certain low-ranking creditors are paid.
The plaintiffs have asserted a $435 million claim and argue that they should be treated as general unsecured creditors.
But Washington Mutual says the plaintiffs' claims are lower in priority to those of other creditor classes, and that they earlier had agreed not to file a claim until distributions were made to a group of low-ranking creditors.
The judge on Monday declined to decide whether the plaintiffs should be treated as general unsecured creditors, but she agreed with Washington Mutual that the filing of their claim was premature because the required distributions to low-ranking creditors have not been made.