The city of Richmond, Calif., has asked a judge to dismiss a lawsuit brought by bond investors relating to the city's threatened use of eminent domain to seize mortgages in an effort to help the housing market, according to court filings from late last week. Deutsche Bank and Wells Fargo estimate that investor losses in the Richmond case could reach $200 million. "If Richmond were allowed to proceed, other local governments would follow suit, with the result that these damages across residential mortgage-backed securities trusts would exceed billions of dollars," they said.

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