Mr Cooper Group Inc (COOP)

[clawmann]

BlueFoxx, the purpose of my post was to note that the issue is not as clear cut as those arguing that the abandonment cuts us off from FDIC distributions seem to believe. I have been following this case for quite a while, and I am very aware of why WMI abandoned the stock.

Nevertheless, if there is a surplus, the FDIC cannot just keep it or hand it over to the government. The FDIC's regulations clearly provide that any surplus shall be distributed "to shareholders, members, general partners, limited partners, or other persons with interests in the equity of the covered financial company arising as a result of their status as shareholders, members, general partners, limited partners, or other persons with interests in the equity of the covered financial company, in proportion to their relative equity interests." My point is that the regulations anticipate that persons who are not shareholders, but who have "interests in the equity of the covered financial institution" may still be entitled to receive a distribution.

So the issue is not clear. And to my knowledge no one - no one - on this board or any other that I have visited has done a truly professional analysis of this issue. Furthermore, I have not yet found any dispositive authority on the issue, so it appears quite possible for the former shareholders of WMI to put forward an argument that - notwithstanding WMI's stock abandonment - the former shareholders of WMI have an interest in the equity of WAMU and are entitled to receive a distribution of any WAMU surplus.

I don't know whether the argument will succeed or not, but I am dead certain no one on these boards knows either. In fact, I am not certain the FDIC even knows, as this may well be an issue of first impression, and it needs to be thoroughly briefed and analyzed. I continue to research this because former WMI shareholders may ultimately have to pursue this issue independently from WMILT, which may be disabled, as representatives of the estate, from pursuing it.

People should stop advancing legal conclusions as if they were a judge deciding a case. At this point there are only arguments on both sides, and I can appreciate the logic of each. But at the end of the day a surplus - if there is one - has to be distributed to someone, and I think equitable considerations - regardless of the abandonment - strongly favor that that distribution go to former WMI shareholders, principally because I don't see who else it could go to.