With regards to the mediation with the EC that everyone is talking about, here is my take:
From the transcript:
having seen the mediation statement that is
sent out when you file a complaint, having recognized that the
debtor is in mediation with the trust-preferreds in connection
with their appeal, having seen that when the equity committee
tried to bypass mediation in the context of their appeal, the
debtor insisting that they should go through the mediation
process, that I think that a mediator during the month of April
to try to mediate our situation would be totally appropriate..
I will note that when the equity committee appealed
the global settlement, they wanted to bypass the mandatory
procedures for mediation, and the debtor refused. The
debtor -- and I wouldn't -- I assume it wouldn't be because
strategically they were trying to slow down the equity
committee in their litigation -- but they actually thought it
made sense to actually have a dialogue with an equity
committee. And I assume the equity committee is asking for
money. So I assume if they have flexibility talking to the
equity committee in a mediation, because they don't think that
that's a waste of estate assets, then they should be talking to
me.
But the idea of foreclosing mediation under these
circumstances, when they're mediating with the trust preferreds
and they're mediating with the equity, and I assume they're
mediating for a reason, which means they're going to offer them
something more than nothing. So the notion is why aren't they
mediating with us. And I do think that the world changed.
They thought they had a clear case
Judge: OK OK (this is when she cut him off)
So I read this OVER AND OVER AGAIN to make sure I understood what was going on during this ordeal. Basically, the mediation process refers to the EC's appeal of the GSA being declared fair and reasonable by the judge. Apparently, (according to Steinberg, but I'd have to research it more as I am no legal eagle) there is a mandatory mediation process before anyone appeals a judge's ruling. The EC wanted to bypass it altogether to make the process quicker. The debtors wanted mediation and according to Steinberg, he thinks it's not because the debtors wanted to slow the EC down in the appeal, but more to see if they could offer the EC something ("something more than nothing" and he "assumes the EC is asking for money") to put things aside and not let it go to the appeals process because the doodoo will really hit the fan. So Steinberg may have let slip what was going on behind closed doors and the judge stopped him in his tracks.
Let's put it together:
1) Mandatory mediation before appeals.
2) Debtors say "hey, let's go to mediation...I'm sure we can work something out before you go to a higher power since you got some solid legal reasoning for your appeal...because the judges fair and reasonable nonsense is appealed, this thing will spiral out of control"
3) Debtors and EC go through mediation and have dialogue, and Steinberg specifically says, they must offering the EC some money because thats the only thing the EC is after.
4) As we know, EC chairman is only holding post-seizure commons at average of .20 cents, so the Debtors must know they can't offer anything less than that TO THE COMMONS, which means preferreds will be taken care of. Why would debtors even have dialogue with EC if they were to offer anything less? EC would just give BR the 2 middle fingers and head to appeals.
THIS MEANS THERE IS MONEY BEING OFFERED TO EC. I can't state it any clearer. That explains the deafening silence from the SG. Insider trading will just be gravy if proven and FJR and claim disallowance is approved. That's why this judge has allowed the EC to stay alive. That's why the UST is still looking for new EC members. That's why BR is demanding PJS numbers through discovery.
It's not IF the commons get money. It's now a matter of HOW MUCH.
AIMHO
AI
