On May 17th the U.S. District Court for the Southern District of New York, on its own initiative, vacated an order granting summary judgment to defendants in a mortgage-backed securities ("MBS") lawsuit. Plaintiffs filed a complaint in state court alleging that defendants fraudulently sold MBS. Asserting federal jurisdiction under the Edge Act, defendants removed the case to this Court, which granted defendants' motion for summary judgment. Two weeks later, the Second Circuit addressed the scope of the Edge Act's jurisdiction in a certain case and the District Court found it necessary to revisit this matter. The Court noted that only 18 of the almost 250,000 mortgages involved here were on properties located in the Virgin Islands. Those loans, moreover, were originated by a non-party. Because the Edge Act confers federal jurisdiction only when a federally chartered corporation is a party and the suit arises out of an offshore financial transaction of that federally chartered corporation, the Court concluded it lacked jurisdiction and remanded the case to state court. Dexia SA/NV v. Bear Stearns & Co. Inc.