Rosen's "clear abuse" accusation is hogwash - The fact is, the supposed POR/DS (disclosure statement) was NOT agreed to by all parties (FDIC, Bondholders) - for significant reasons in no relation to the Equity Committee's motion. According to Rosen in a Reuters article, the settlement "would be vapor", for instance, if WMB Bondholders were allowed to pursue claims against the parent company. They have been allowed to pursue fraud claims in WaMu's bankruptcy proceedings this week. Also, the FDIC objects to JPMorgan Chase receiving up to $1.4B in WMI's tax refunds as part of the settlement. JPMC received federal bailout funds and would be ineligible to receive this windfall. [1]
In fact, WEIL should be sanctioned as lead counsel for not disclosing to the EC that a settlement was imminent (remember Venable wisely disclosed in open court March 12 that the EC was not notified of any proposed settlement). The firm should be further scrutinized for engineering a favorable settlement for JPMC, after a Wall Street Journal article exposed a conflict of interest between Weil Gotshal and the company that prevented Weil from pursuing litigation in the WaMu case directly, deferring instead to Quinn Emanuel. WMI's Board of Directors apparently signed a waiver of this CoI upon retaining Weil. [2]
The Equity Committee Motion does not meet the standard for "clear abuse" if the success of WMI's reorganization efforts was already gravely threatened by major deficiencies in settlement negotiations not in any way caused by the Motion, and by hostile counsel for the Debtors who saw fit to keep the Committee "out of the loop" in these talks, to the extent that they had no recourse but attempt to preserve shareholders' rights at the eleventh hour.
IMO I laugh at the Brain's absurd argument that he dare accuse our constituency of abuse to defend a reorganization effort that, for all intents and purposes, was dead on arrival. GLTA
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