On January 11, monoline insurer MBIA Insurance Corp. sued Flagstar Bank and its affiliates for breach of contract in the United States District Court for the Southern District of New York. MBIA alleges that it insured $1 billion in RMBS for Flagstar in 2006 and 2007. The complaint claims that Flagstar made misrepresentations about the allegedly defective loans underlying the securities. Further, MBIA alleges it has made claims payments in excess of $165 million, and that Flagstar has breached its contractual obligation to repurchase the allegedly defective loans. Complaint.