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That is a great question and I'm afraid I don't quite know the answer.
If emails are produced, WMI would be able to check the metadata to determine the source contents and path (i.e., date/time/receipients/sender). However, I don't know how they would check documents that were not subjected to electronic transmission or email.
The court would treat this as the most egregious form of discovery abuse and possibly open up charges for perjury and fraud.
BTW, I'm at my post limit for the day...I'll catch everyone tomorrow. Check out WMI's letter in response to JPM's letter to Judge Sleet -- courtesy of Ghostofreagan on Yahoo! http://www.box.net/shared/0n96ucvopq
Thanks XOM, I'm very happy to see so many like-minded, genuine individuals here. I have very similar plans and I couldn't agree more about this being an investment for our families.
Best of luck to everyone. We'll all be celebrating soon.
That's an interesting point and I'll certainly consider it if/when the opportunity comes. Thanks for the advice, Doc.
Fish, how long do you think this process will take? Is it likely the Treasury will be able to offload the warrants before the hearing on the 24th?
Unfortunately, no. I imagine the decision will come prior to the hearing on the 24th though.
Fish, I wouldn't miss it for the world -- I just hope our Vegas trip doesn't interfere with final exams, lol. In any event, I think alot of us are going to be collaborating quite often after this is all over. You can count on me making myself available for it.
I will never lose sight of right/wrong nor would I ever sell out for something I do not believe in. If the investment yields what most of us are hoping for (Diamond's $12+), I honestly don't think I would bother trying to work with a large firm. The quality of life is awful and most people are shunned for making family a priority -- and both of these factors are important to me. I would finish up with my J.D. and try to gain some practical experience as a prosecutor or within a small practice setting while I brainstorm and collaborate over long-term investment opportunities on the side to continue building wealth. Being a person of a humble background, I would definitely get involved in pro-bono work and philanthropy to help whenever and wherever I can.
I consider us all very lucky to have the knowledge and awareness of an investment opportunity like this in our lifetime. For many of us, it will change our lives and shape our future -- the key is to make the right decisions when that time comes.
JPM (and the FDIC) appealed to the Delaware District Court (Index No. 09 Civ. 00118) on July 15th. Chief Judge Sleet is the presiding Judge in the appeal.
Jerle, you nailed it in your second sentence. I totally agree that these unnecessary delays demonstrate JPM's unwillingness to settle, however, they are beyond desparate at this point and exercising each and every potential option at their disposal to delay, impede or prevent the inevitable -- discovery and a subsequent trial where damages will be paid and from which potential criminal proceedings will derive.
Once we reach the new 08/27 discovery (or quite possibly soon before) they will have no choice but to produce their documents and prepare for depositions. If JPM has exhausted every avenue at its disposal to delay, impete or prevent this from happening with no success, then it'll either submit to discovery with overwhelming consequences or settle with WMI at the very last minute. I believe the latter will be the end result here.
This is a great point but in all honesty, I'm not too familiar with the facts surrounding the alleged $17B in WMBfsb or whether the same standard that applies to the $4.4B in WMI deposits would apply to the $17B. Can anyone chime in?
Anytime. I wish I could do more.
Good luck to all and go WAMU!!
I think it was excellent. WMI did a fantastic job of reiterating standing precedent and binding authority in support of Judge Walrath's decision -- and it included allusions to policy implications as well as the bootstrapping and delay tactics employed by the FDIC and JPM.
I imagine we'll see more than just an Order from Chief Judge Sleet -- we'll probably see a well written opinion further affirming Judge Walrath's decision too.
I just looked at the docket sheet for the appeal and it appears as though it has been fully briefed by JPM and WMI. I think we should have a decision denying JPM's appeal very soon -- I expect to see it before the hearing on the 24th -- which further supports the notion of settlement within the next few weeks.
Thanks Rocco...very much appreciated.
Well, for arguments sake, if JPM produces the documents I think the whole process will drag on for some more time as WMI begins supporting its case with evidence obtained vis a vis discovery and testimony obtained through depositions. New claims (even third-party claims) may be filed and criminal claims may be initiated against JPM by the U.S. Attorney's Office if/when any incriminating evidence is uncovered in the discovery process. The cost of settling the civil/bankruptcy cases will cost much, much more -- while the criminal proceedings continue to unfold and form a shadow of doubt over JPM and quite possibly, the U.S. financial system and it's regulators.
We do know what documents WMI requested because JPM included WMI's discovery request in the appendix of it's motion for reconsideration.
There is alot at stake with moving into discovery. JPM won't let that happen.
I sure hope so. God knows I've been praying, haha.
I guess its because JPM is at the end of its rope with the proximity to discovery, a presumably denied appeal to the district court, potential backlash from Walrath for their contempt and finally, the likelihood of the $4B being rightfully returned to WMI.
JPM has really exercised its legal strategy with a complete disregard and disrespect for the judicial system up to this point. I cannot see this going into discovery, let alone into trial.
Forget about the opposition/reply briefs -- they'll run the second the settlement motion is filed.
Unless it's a motion for "global settlement" between all parties (which may very well be the reason JPM requested the noteholders' identities) and presented jointly without opposition, I suspect that Judge Walrath would be precluded from granting it until parties are given a timely opportunity to submit briefs for/against the motion.
It'll end up on the docket if the parties file a motion, but it won't be on the schedule if the motion is not filed (and probably won't be on the schedule if the other parties don't get a chance to file briefs on the motion).
Indeed.
The last settlement motion filed by WMI was for the savings plan and it was filed afterhours on a Friday.
The anxiety continues to build, lol.
Excellent, thanks Jerle!
I have a funny feeling that we're going to see a settlement motion filed before the documents are produced on the 27th and quite possibly even before the hearing on the 24th. I don't believe there is any way Dimon will allow JPM to produce a single document and common sense dictates that he wouldn't want to lose his valuable $4.4B bargaining chip.
I guess only time will tell. Good luck to all and go WAMU!!
Is it confirmed whether the discovery documents are due on the 24th as well or is the date still TBA?
Thanks guys, I just hope the letter helps our cause and brings some more media attention to this debacle. We need justice and we need it soon.
Based on JPM's courtroom audacity and blatant disregard for Judge Walrath's authority, I think it's pretty obvious that JPM doesn't care about what the judicial system thinks of it's antics. Maybe if and when the WSJ sheds a little bit of light on the subject, it'll care about the (newly-informed) general public's perception.
One can only hope!
WSJ Article on Dimon and Wall Street.
http://online.wsj.com/article/SB125007909275825709.html?mod=googlenews_wsj
I sent an email praising the author and implored him to investigate, research and publish our cause with the same bold honesty he used in the above-referenced article. I just received a "thank you" response from him and remain eager in anticipation for some more coverage. See below for the contents of my email:
Mr. Weidner,
I just wanted to personally reach out and praise you for boldly speaking the truth about the Wall Street circus antics. I personally believe Mr. Dimon's hubris in these delicate times will cause some issues for JPM in the near future, mainly from its exposure to the litigation with WAMU and the FDIC.
I am a WAMU shareholder with an undergraduate-level finance background, currently undergoing a law school education. The lack of significant media coverage on the subject is totally beyond me and other shareholders similarly educated on the facts and ongoing events surrounding the unique and questionable circumstances of this case, such that many have gone so far as to ponder the possibility of JPM exercising some control in spinning the media to its advantage. I realize the "too big to fail" theme might give various policy incentives for the media to glorify JPM, but what I don't understand is how it can allow all, if not some, of JPM's egregious behavior to go unrecognized.
There is a plethora of information available concerning the seizure and subsequent legal proceedings. I implore you to look into the matter with some close scrutiny and publish your understanding of the truth as you did today and would be happy to provide you with some links and information to assist in your investigation. Thank you for your honesty and for your efforts in upholding our constitutionally protected right to free speech.
Sincerely,
R. Ramirez
Haha, thanks Jimmy...much appreciated.
I will certainly be down to celebrate over a beer once this is all over.
Calling all newbies -- I referenced an excellent summary posted by Marymbobh on Yahoo! for you to get up to speed on the general matters here.
Don't Get Lost in the Details
All of the pleadings, briefs, arguments, counterclaims, and sundry legal actions can cover up the simple facts of the case. WAMUQ (not WaMu) became insolvent when the OTS seized its subsidiary WaMu bank, cutting off its major income source, leaving WAMUQ unable to service its obligations, particularly its $7 billion in bonds. The OTS named FDIC as receiver of WaMu bank, whereupon the FDIC immediately sold the assets to JPM. However, prior to the sale, the FDIC made no attempt to determine which assets belonged to WAMUQ and which assets belonged to WaMu and the asset schedule in the Purchase and Sale agreement was omitted, although referenced. WAMUQ subsequently filed for bankruptcy and has filed an adversary action against JPM requesting that JPM turn over the $4 billion in cash held in a formerly WaMu and now JPM account. All parties agree that the account owner is WAMUQ. Under bankruptcy law, the bankruptcy court has exclusive jurisdiction to determine which assets belong to the bankrupt estate. If the $4 billion bank acount is determined by the court to belong to the estate, then adjudication of claims to the money contained in the account also must be through the bankruptcy court.
JPM has repeatedly attempted to claim that the central issue is that FIRREA prevents the bankruptcy court from having jurisdiction over challenges to the FDIC sale of assets...which is false. The issue for the bankruptcy court is to determine what the assets of the WAMUQ estate are and distribute those to the rightful creditors. If the assets are the property of the WAMUQ estate, then the FDIC did not have any title to convey them to JPM, JPM has no legitimate title to them, and the application of FIRREA to claims against those assets has no relevance in bankruptcy court or anywhere else. It is not WAMUQ or the bankruptcy courts problem if the FDIC didn't attempt to establish and enumerate exactly what it was 'selling' and it is solely JPM's problem if it paid for something that the FDIC had no right to sell. In the absence of any such enumeration, the presumption by JPM and the FDIC would and should have been that only assets belonging to WaMu bank were conveyed.
JPM is also apparently appealing the Rule 2004 discovery order through a twisted, convoluted theory in which the bankruptcy court lacks jurisdiction over the WAMUQ estate since the estate allegedly includes claims against assets that the FDIC conveyed to JPM and claims against those assets are barred by FIRREA. Under JPM's strange theory, bank holding companies would be prevented from ever seeking protection in bankruptcy court and any asset held by any such holding company would effectively always belong to the bank(s) owned by the holding company.
The bottom line is that JPM's arguments regarding FIRREA have been heard and decided. They were extremely weak to begin with and they have not aged well. JPM's appeal and leave to appeal will be ignored and they will be answerable to Judge Walrath for their failure to produce what was requested in the discovery order.
http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_W/threadview?m=tm&bn=86316&tid=209345&mid=209345&tof=5&frt=2
And I agree with Bop. The documents still have to be produced by the end of the month and we all know Judge Walrath will be eagerly anticipating the hearing on 08/24 because of JPM's ridiculous attempt to go over her head.
Bop says "days, maybe weeks" and I think she/he is right.
If they "probably think they have done nothing wrong" then why are they stalling and why not just go forward with the litigation?
They're stalling because they do not, I repeat, do not want to produce documents, subject themselves to more liability and proceed with litigation. Theres also a good chance that financing the settlement with the FDIC has something to do with it too because I'm sure Weil, Quinn and A&M are shooting for maximum recovery to the estate -- why else would JPM suddenly sell 23 office buildings to raise $1-2B in cash?
They will settle this very soon. All of these delay tactics are smoke and mirrors -- they know their exposure to liability because S&C and Landis Roth have already counseled them on it, as it is in their fiduciary duty to do so. Ask Fish or any of the other good boardmembers here -- this is all going to be over very soon.
I think Judge Walrath is going to file her decision and order on the $4B soon -- and that is going to push JPM over the edge to settle this now instead of continuing its antics. Larry888nyc on Yahoo! couldn't have said it better when he posted that this letter would be the straw that broke the camels back.
Remember what happened the last time JPM and the FDIC undermined her authority -- she granted WMI's motion for the rule 2004 examination that very evening.
Hell hath no fury like a woman scorned.
I would LOVE to hear or read the transcript of the next hearing on August 24th regardless of whether we settle by then or not.
JPM's Latest Stall Tactic
They're trying to go above Judge Walrath's head and seeking withdrawal of the reference from the Chief Judge of the Delaware District Court (note, they're not writing to the bankruptcy court).
http://members.cox.net/raggztwitches/JPMLetterToJudgeSleet.pdf
I didn't scrutinize the authority they presented in citing Lubin case too much, but in my opinion it is weak. The case is a Georgia District Court ruling from the 11th circuit, so it won't be all that strong in the Delaware District Court - which follows the 3rd circuit. Moreover, JPM's direct citation of Lubin in the second paragraph (seeking mandatory withdrawal) is baseless as the principal of "necessity" behind JPM's FIRREA argument was already decided on by Judge Walrath in WMI's favor. It also requires an affirmative determination by the district court on a standard of law which JPM stands no chance of meeting (BOPFAN has covered this many times). As for permissive withdrawal (the only other mechanism for withdrawal), JPM's argument fails on it's face because they're clearly forum shopping, causing confusion, decreasing uniformity in the bankruptcy administration and inefficiently diminishing the parties' economical use of resources -- all requisite criteria for permissive withdrawal and none of which JPM has.
I expect this to be denied by the District Court and hope Judge Walrath brings the "wrath" of God (and the Bankruptcy Court) down with that hammer on the 24th. She is going to be pretty pissed with JPM for going over her head to once again undermine her decision. This charade needs to end and it needs to end soon.
WMI, please make it rain.
That is great. Consider this disclosure to be JPM's caution to shareholders as it foresees settlement in the very near future.
"there is no assurance that the ultimate resolution of these matters will not significantly exceed the reserves currently accrued by the Firm"
An "ultimate resolution" seems to me like incogneto wording for a "global settlement" and the cost of resolution, as disclosed by JPM, is going to be very favorable to us.
I'm at my post limit for the day. Good luck everyone and see you all tomorrow.
Weil's Billing -- with much thanks to Sidedraft for hosting it:
http://www.sidedraught.com/stocks/WashingtonMutual/Weil%20Billing%20Statement%5b081009%5d%20-%20Items.pdf
Weil's billing statement is up and "global settlement" is all over it.
I'll send the 354 page appendix, which itemizes the charges submitted by Weil to the court for reimbursement, to someone for posting if they post back with an email address. Theres no sense in paying for the other documents and getting them out.
Enjoy!
Edit: Thank Sunshinevibrations on Yahoo! for uploading it.
http://www.mediafire.com/file/3zwdirzyjtd/Weil_billing_8_06_09.pdf
I can agree with that. I'd be a little concerned if we move forward with the discovery process and into litigation.
No one knows, but all of the circumstantial evidence on the table (possible placement of a mole, lack of meaningful bidding process, etc.) suggests that it is certainly possible.
Oh, and I forgot to add possible third-party claims to my last post, haha.
I know and I wasn't offended. I agree that your experience is invaluable, but I don't know how useful experience can be in a case with as many unique and unprecedented circumstances as this.
I don't think the market will move the PPS because the stock is subject to lots of manipulation by MM activity -- and I don't think the PPS will ascend upward on its own until the shorts have covered -- but I do believe that a favorable ruling from Judge Walrath, granting WMI's motion for summary judgment, would move it with or without the shorts covering their shares. The legislative branch of the U.S. government can try to intervene, but it cannot stop the judicial branch (i.e., Judge Walrath and the Delaware Bankruptcy Court) from doing its job.
The potential criminal and civil claims lurking in the discovery documents as well as the damages on existing claims would result in quite a bit more than $18/share.
Its as simple as applying the business judgment rule. Pay less now and make it go away quietly rather than pay more (and risk criminal liability too) and ruin your reputation later.
Thanks Gyspsy. I'm sorry, but I don't think age has any bearing here because this is an unprecedented set of circumstances that will change the rules of the game for the FDIC (as it already has for the OTC) and other financial regulators. This is a unique bankruptcy. It is nothing like Bear Stearns (whose common stockholders recovered $10/share post-acquisition by JPM, I might add) which legitimately failed. The legal system will warrant settlement or damages and that is all we need to see assets significantly exceed liabilities.
Well said, Fish. I couldn't agree more.
Anytime Jestir...hope your trip to Delaware went well.
Good luck, all!!