Mr Cooper Group Inc (COOP)

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From BP :

SUMMARY OF ARGUMENT

1. The Bankruptcy Court did not abuse its discretion in determining that the settlement was a reasonable exercise of the Trust’s business judgment. Litigating the claims objection would have been expensive, complex, and long, and re-opening the litigation would mean spending real dollars to determine claims in classes that only have received a partial distribution (Class 18) or interests that will not receive further distribution (Class 19). The settlement was reasonable.

2. Griffin’s objection is untimely. The Trust argued untimeliness in the Bankruptcy Court, noting that the statute of limitations for the breach of fiduciary duty claim on which Griffin premises her objection is three years and long-past expired. The Bankruptcy Court determined that Griffin’s objection was untimely and precluded under the doctrine of laches. This Court may affirm on any ground supported by the record, and the record supports a finding of untimeliness under both the statute of limitations and laches.

a. Statute of limitations. The Bankruptcy Court found that Griffin was on notice of the Allowance Stipulation in 2013, and therefore the record supports a finding that the three-year statute of limitations expired in 2016.

b. Laches. The record also supports a finding that Griffin’s delay was unreasonable and prejudicial. First, because the analogous statute of limitations expired, Griffin’s six-year delay creates a presumption of laches that she cannot overcome. Second, even if the burden were on the Trust, the record shows that Griffin was on notice of the settlement in 2013 and had no reasonable excuse for delaying until 2019 to object. This delay prejudices the Trust by seeking to re-open what the Bankruptcy Court found would have been long, complex and costly litigation, with no guarantee of success for the Trust, for a class that has not and will not receive distribution other than the initial distribution of shares of Reorganized WMI on the Plan’s effective date.

3. Because Griffin makes a request for substantial contribution for the first time on appeal, this Court should not entertain that request. Even if it did, Griffin cannot show that her efforts benefitted the estate or that she acted altruistically. To the contrary, her efforts have depleted estate resources that have harmed Class 18 and have put Class 19 even further out of the money.