SAN FRANCISCO (Reuters) - Bond insurer MBIA Inc accused Morgan Stanley in a lawsuit of misrepresenting the quality of mortgage backed securities insured for over $223 million.
The case against Morgan is the latest in a series of actions brought by MBIA against financial firms over mortgage backed securities.
MBIA's lawsuit claims Morgan made false representations regarding the underwriting standards for a pool of approximately 5,000 subordinate-lien residential mortgages, according to the lawsuit, which was filed on Monday in New York State Supreme Court in Westchester.
MBIA has paid over $71 million in unreimbursed claims through November 2010, and expects to pay substantially more over time, the lawsuit said.
A MBIA representative declined to comment.
"The lawsuit is without merit and we intend to defend ourselves vigorously," said Mark Lake, a spokesman for Morgan.
MBIA has also filed lawsuits against companies including Bank of America Corp
The case in the New York State Supreme Court in Westchester is MBIA Insurance Corporation v. Morgan Stanley et al., 29951-10.
(Reporting by Dan Levine; Editing by Bernad Orr)
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