Mr Cooper Group Inc (COOP)

[fsshon]

WMI lawsuits against JPM summary $12 bet combo!

From this filing in Delaware bankruptcy court, 5/29/09:
http://www.kccllc.net/documents/0812229/0812229090529000000000010.pdf

1st CC, p114: Capital contributions: avoidance and recovery, ~$6.5B, fraudulent transfer

2nd CC, p115: Capital contributions: avoidance and recovery, ~$6.5B

3rd CC, p116: Trust securities: ~$4B, avoidance and recovery

4th CC, p117: Trust securities: ~$4B, avoidance and recovery

5th CC, p118: Trust securities: ~$4B, avoidance and recovery

6th CC, p119: Trust securities: ~$4B, avoidance and recovery

7th CC, p120: Trust securities: ~$4B, declaratory judgment that securities are property of Estate

8th CC, p121: Preferential transfers: avoidance and recovery

9th CC, p122: Preferential transfers: avoidance and recovery

10th CC, p123: Fraudulent transfer: P&A Transaction is avoidable as a F.T.

11th CC, p124: Disallowance of claims by JPM

12th CC, p125: Declaratory judgement on all "Disputed Assets" as property of Estate

13th CC, p126: Turnover of intercompany amounts due

14th CC, p126: Unjust enrichment claim

**15th CC, p126: Trademark infringement

**16th CC, p128: Trademark infringement (common law)

**17th CC, p128: Patent infringement

**18th CC, p130: Federal copyright infringement

(**Note the jury trials demanded for 15-18)
------------------------------

Valuation of WMI amended counterclaims against JPM, filed 9/11/09, Delaware Bankruptcy Court:
http://www.kccllc.net/documents/0812229/0812229090914000000000003.pdf

A. Capital Contributions: by WMI to WMB (JPM)
-- constructive fraudulent transfers
-- value $6.5B

B. Trust Securities: WMI owns but value went to WMB (JPM)
-- constructive fraudulent transfers
-- value $4.0B

C. Other transfers: by WMI to WMB, fsb, or for benefit of WMB (JPM)
-- constructive fraudulent transfers
-- value $3.4B

D. WMI received less than reasonably equivalent value for WMB when sold to JPM
-- unliquidated - no value specified
-- catch-all for total value not included in other claims?

E. Intercompany Accounts: owed by WMB (JPM) to WMI (does NOT include $4B cash in DDA)
-- 177M + 22M + 490M
-- value $0.7B

F. JPM unauthorized, intentional, and infringing use of WMI intellectual property
-- trademarks/service marks, patents, copyrights
-- value of WAMU brand alone $6.0B

----------------------------------------------------- -------
TOTAL value = $20.6 billion + unliquidated claims


$12+ is a safe bet. Most of the legal analyst's both boards put it at around $24/s. The reasoning goes like this:

1. Book value of WMI on June of '08 was $26B see their 10Q.

2. Aug. '08 TPG put in almost $8B. Capital infusion. It was originally preferred stock but was converted to commons. This is what Bondermann and the Texas lawsuit is about.

3. Independent auditors have placed a book value on WMI of around $52B.

4. In a court case damages could run as high as 3X book value if it goes the distance to a jury trial.

5. Our legal analyst's both boards think Weil would ask a minimum, 2X book value for a settlement.

6. So, 2X book value at low number $26B would equal $52B settlement money. Subtract $8B liabilities, $4B P's & H's (bonds are part of WAMU Bank not WMI so not accountable here).
That leaves $40B for the commons. $40B/1.7B O/S equals $23.5/s. End of story.

7. Interesting to note: All legal minds of both boards seem to agree on this scenario.