A federal judge in Washington Monday threw out virtually all the defenses the government has raised against a series of lawsuits that could force the government to pay billions of dollars in damages to the owners of failed savings and loans.
Judge Loren A. Smith chastised Justice Department lawyers for stalling the suits. He said he was prepared to rule that the government must pay damages to the owners of about 120 savings associations that sued the government because they were hurt financially when Congress tightened thrift regulations in 1989.
Marine Midland Bank has a suit pending as part of its acquisition of First Federal Savings and Loan Association of Rochester.
Goldome Bank and Empire of America Savings Bank in Buffalo were two banks that were taken over by the government and their assets were sold to First Empire State Corp. and Key Bank.
Empire of America can't sue because federal regulators took over the bank as soon as the goodwill change was made. Goldome can't sue because it was closed under different state banking laws.