O’Melveny’s McKeen, Oakley, Pavel Co-Author Article on Use of Eminent Domain To Write Down Mortgage Notes

January 10, 2013

O’Melveny & Myers LLP partner Elizabeth Lemond McKeen, counsel Danielle Oakley, and associate Ashley Pavel co-authored an article for the December 11, 2012, edition of Thomson Reuters’ Westlaw Journal: Securities Litigation & Regulation on the proposed use of eminent domain to write down mortgage notes by San Bernardino County.

In July 2012 the Securities Industry and Financial Markets Association publicly released a legal memorandum prepared by O’Melveny articulating potential legal and practical problems with a proposal currently being considered by the San Bernardino, Calif., Joint Powers Authority (JPA) to seize mortgages on underwater properties and write them down. The proposal remains under consideration by the JPA, which is scheduled to convene this month. The authors note that “as other municipalities consider similar issues, the legal issues raised in O’Melveny’s memorandum are sure to be at the forefront of all related discussion and ensuing judicial challenges, should such a proposal be adopted,” and summarize these issues in the article.

McKeen, Oakley, and Pavel are members of O'Melveny's Financial Services Practice and reside in the Firm's Newport Beach office.