Countrywide's Attempt To Gag Bankruptcy Trustee Challenged By USDOJ

In Pittsburgh, Pennsylvania, The Wall Street Journal reports:

• The U.S. Justice Department has challenged a deal Countrywide Financial Corp. has cut in a Pittsburgh bankruptcy court, saying the home lender is trying to silence an active critic. A nondisparagement clause in Countrywide's settlement with Ronda Winnecour(1), a court official who monitors consumer bankruptcies, "may impede, impair or otherwise chill witness testimony in the U.S. Trustee's ongoing investigation of Countrywide," Justice Department lawyers wrote in court documents. The provision binds Ms. Winnecour to a promise not to "in any manner, whether directly or indirectly, disparage" Countrywide. Additionally, Ms. Winnecour is to ensure that her employees don't criticize the company.

For more, see Countrywide Deal With Critic Is Disputed (requires subscription).

See also:

• Forbes: Hearing in Pittsburgh for Countrywide settlement (A hearing is scheduled Monday in Pittsburgh on whether to approve a settlement worked out between Countrywide Home Loans Inc. and a Chapter 13 bankruptcy trustee),
• Reuters: Countrywide pact challenged by US Justice Dept.

Go here for other posts on Countrywide's litigation in the Pittsburgh bankruptcy court.

(1) According to the story: (a) Ms. Winnecour took on Countrywide in nearly 300 Pittsburgh consumer-bankruptcy cases, accusing the company of mishandling payments her office sent to satisfy mortgage debt; (b) she alleged in her motions that Countrywide lost, destroyed or misplaced $515,000 in checks and after losing or destroying checks, Countrywide may have added improper charges to the mortgage debt owed by consumers in hundreds of cases.