1. It is NOT a "much better idea" to advance signal the intent and content of a possible lawsuit if warrants get exercised.
Obviously I disagree with this.
Why go to war with Mnuchin who could be a help to shareholders if he just follows the law.
Because you're assuming that he believes that exercising the warrants is somehow illegal. The #Fanniegate crowd contains the only people who think the warrants are illegal.
Ackman thinks Treasury should exercise the warrants. So does Berkowitz. So do the Collins plaintiffs. So does Calabria, as mentioned in his interview. If there were any doubts whatsoever as to their legality, none of these people would have said what they have said.
3. Creating conflict over warrants with UST could be a catalyst for them to abandon warrants and go for sale of the Senior Preferred shares to outside capital players. That could be lead to cancellation of ALL existing equity.
I highly doubt this. The en banc ruling is likely to get rid of the seniors, and if it doesn't (remedy #2: Treasury sends $122B to FnF and keeps the seniors intact) then the seniors are likely to be converted to commons anyway. The seniors cannot exist in their current form alongside a recap.
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