From Yahoo Message board...
I was in the court room today... 22 minutes ago Just getting online now after driving from Wilmington down to the DC area where I have been traveling on business all week.
In addition to learning that BrewHaHa (cafe across from the Bankruptcy Court) has excellent coffee and scones; today's hearing was very insightful not for what I heard, but for the opportunity to size up each party's counsel, the judge and and hear conversations from the gallery of observers assembled.
1. Quinn Emmanuel delivered a very well articulated argument that from a delivery perspective was presented with confidence and received in an a matter of fact fashion by THJMW, and as Ellsberg hammered his argument home there was a great deal back and forth among S/C and poor Sachs looked like he wanted to vomit.
2. Either Sachs was under the weather today or his argumentative style matches the weakness and poor structure of his overall argument. Even though JPM and FDIC maintain a similar position on the 4B; the arguments they made from each perspective were disconnected, and in some cases in conflict. THJMW smirked at many points as if counsel was on the fringe and reaching in his effort to defend his position and the need for a full fledged trial on the 4B. Sachs was under visible pressure to deliver. JPM's argument could be sumized as if there "was" money there it is OURS; but we are NOT SURE if there was/is money so we can't give it to them (even though we are calling these core deposits and paying FDIC insurance premiums. Say what? Talk about trying to have it BOTH ways - THJMW's body language communicated the same.
3. FDIC's attorney did all but threaten both WMI and theTHJMW court, which Ellsberg addressed in his rebutle very well. During this argument, I found it was delivered simply as a warning to THJMW- No matter what you do, we'll use our power to grab the money "in flight" before it can be transfered to a non JPM account held by WMI. Eyebrow raising for sure but the judge seemed unwavering in her concentration and seemed underwhelmed as if to say "is this all you got?"
4. Big Money was represented in the room. Although only attorneys had to sign in today, it was evident by the pre trial conversations that hedge funds and other investor types in very expensive suits took the train down from the greater NYC area to SEE for themselves how this was proceeding. All, including myself, sat behind Team WAMU lead by Quinn Emmanuel with one eye on the showmanship and another on our blackberrys communicating back to a home base or trading minions.
5. More journalists today. Although this is the first hearing I have been at, and it is back to Wisconsin for me tomorrow, there were no less than 4 "back benchers" dressed in casual attire busily typing away from start to finish.
I was frustrated; (as I am sure many here were when you viewed the first AP blurb "spun" as though the judge was had delayed a ruling even though non was expected today and only JPM's argument was represented) I am glad to see that the follow up articles from the AP, Reuters, and others were more balanced and comprehensive in what actually happened today.
Overall impression:
Nothing about a long's (my) investment thesis was impacted today. As mentioned by JPM/FDIC counsel WMI is arguing illegal seizure and fraudulent transfer, and that the this 4B is one asset of many fraudulently transferred to JPM by result of the OTS and FDIC's accelerated auction process 13 months ago.
