Ya de vuelta a este maravilloso foro os dejo un post de Patience bastante interesante...
The judge said she is not going to re-litigate most issues in GSA. She also said some issues involving JPMC and FDIC are outside her jurisdiction. I think this explains why EC legal counsels logged so few hours during February billing statement. It doesn’t mean EC is giving up. It just means, on a number of important issues, the battle is now moving to District Court for appeal. There is not much EC can do about that except petitioning District Court to expedite the process. Meanwhile, in my view, EC counsels have been immersed with appeal issue already and well prepared for it. It’s a waiting game on that front.
I’ve said on g-board a few days ago, Seth Ard is likely EC’s “appointed man” on WMMRC/NOLs. I've been watching him for a while (since 10/2010 billing statement). He is also heavily involved in insider trading investigations, based on 2/8 and 3/21 presentations. If we recall, Ard was the guy who trapped the debtors’ expert witness Mr. Zelin from Blackstone, and forced him to admit there will be a sizable (up to $5.5B) NOL available to the reorganized debtor after 12/2011. The judge no doubt took notice of that, and made crystal clear in her Opinions she understands the same thing. Moreover, she recently ordered the investigation of WMMRC valuation. As I believe, EC has shifted its focus to WMMRC, NOLs and insider trading investigations. It’s no wonder Mr.Ard logged most hours during 02/2011 billing cycle on those two issues. It makes sense. Remember, he is also stationed in New York with Mr. Susman. The whole case, from the entrance of Susman team to now, from first confirmation hearing, to appeal, to WMMRC and insider trading investigations, is team work and coordinated effort.
People are upset with EC’s “lackluster” performance at 3/21 hearings and long period quietness. I wonder how many people really paid attention to what Ard said at the hearing. EC’s job is not to put up a big show for us to cheer up at DS hearing. Its job was to make its points (of objection) cross the court room and reach the Judge. I think they did. I also think EC’s low key performance at DS hearing was likely a calculated move. As I start to understand after observing the case for more than two years, it’s not enough to win the case if you have the facts on your side. We have to admit, Rosen and WGM are some of the most skilled and sleekest bankruptcy old hands. They know the lope holes and manipulation games in BK arena. Every time when we thought we had the facts and wining arguments, Rosen et al are able to distort the facts and reasoning by citing laws, cases, and other schemes. I think EC didn't want to discuss NOLs/WMMRC/Insider Trading Investigations prematurely on 3/21. The timing is premature. Especially, why bother making a big splash (putting out everything on the table) when you know the court was likely to push those issues to confirmation hearing? In fact, it’s to our advantage to see/study the debtors’ arguments against Blackhorse, individual shareholders, TPS objections, etc. to get prepared more thoroughly. So next time, EC can nail it right on.
People complain or wonder why EC didn’t push valuation at first confirmation hearings. I don’t think I know the exact reason. I can only tell what I think or thought. I still hold that EC knew there were big enough holes in GSA/POR (Releases, COI, bad faith, unaccounted assets including NOLs, unresolved disputed claims, etc.) to stop the POR (Some of those arguments panned out, some didn’t). As Tracadia said in their motions that everyone knows POR will be modified multiple times (from my recollection, not their exact words). Those players are professionals. They knew it’s hardly a done deal at the first hearing for a case of such magnitude. The key is, if the debtors held their work products tight to their chest, why EC was going to show its hands first when there is a good likelihood for second round? Again, I don’t claim I know how this thing work, just my guesstimation.
The focus of next confirmation hearing will be much narrower. WMMRC, its valuation and NOLs, insider trading, FJR will be the major targets. I hope EC can somehow resurrect other GSA issues too at June 6 hearing. But I’m not sure about it because of the Judge’s words of no re-litigation. If insider trading were proved, the issue of bad faith will be likely to re-surface, which by itself can cast a big shadow over GSA. For now, that’s just my conjecture. It’s absolutely necessary to stand up to the authority (in this case the court) when the authority is wrong on issues like “fair and reasonable”. It’s also absolutely the smart strategy to explore areas where we can find common grounds with the authority (like WMMRC valuation and insider trading). It enables us to advance our case more effectively. (I’ve dealt with this topic in detail in “The Next Major Battle”, so I will not elaborate further.)
As for recently revised DS, honestly, do we really expect the debtors to “amend” it to the tune of our liking by putting the honest numbers in places where we thought they should be? No way. Especially after two and half years of hiding, twisting, cheating and bullying, to do so, it’s like admitting bk frauds (as spot1 & others pointed out). Even when EC finally puts out PJS valuation at some point, the debtors will not admit any mistakes. They will continue to dispute, distort, and lie. If they see they are going to lose on valuation issue, they will leave it to the court by saying “Your honor, we disagree. But we accept your decision” or appeal, instead of admitting any wrong doings. That would be the death of professional careers of many of them. Even if they are forced o strike a deal with EC and other objectors, they wouldn’t say a word about their misdeeds. Everyone plays hard ball here.
Throughout this ordeal, there are things I never feel comfortable to talked about like the settlement amount and timing (if we ever get them) because there are too many variables at play. I also never talked about my personal holdings and trading because I don’t want them to be misused as some signs for trading/holding, and also because I want to isolate my personal shares from my reading of the events. To show my dedication and my faith in EC and its counsels, I’m making an exception to partially disclose my holding information. I regard myself as EC Chair Willingham type guy. This is not saying I’m an accountant or bk expert, but in terms of WMI holdings. My holdings in absolute amount are much smaller than his, but like him, he’s 100% in commons, I’m over 90% in commons. I’ve accumulated almost all of my shares prior to 3/12/2010 (including some from pre-seizure). Call me stubborn, naïve, even reckless, I don’t care. To me, this ordeal is always more than just money. Commons are my witness of the justice (or God forbid it, the injustice). I’m an ordinary middle class worker. I care about my shares and financial wellbeing, but I decided long ago, this is the money I can afford to put on the table. Win or loss, I will stick to it.
