Free Response to Motion - District Court of Federal Claims - federal

Case 1:92-cv-00550-MCW

Document 172

Filed 03/14/2007

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS __________________________________________ ) NORTHEAST SAVINGS, F.A. ) ) Plaintiff, ) ) v. ) Civil Action No. 92-550C ) Judge Williams UNITED STATES OF AMERICA, ) ) Defendant. ) __________________________________________) PLAINTIFF'S RESPONSE TO DEFENDANT'S MOTION TO SUPPLEMENT DEFENDANT'S CLOSING ARGUMENT BINDER WITH PLAINTIFF'S COMPLAINT IN THIS CASE

We of course do not oppose the government's motion to supplement its closing argument binder with the Complaint, but we wish to make two brief points in response to the government's statement in support of its motion. First, the Complaint adds absolutely nothing to assist the Court in ruling on Northeast's claim beyond what the parties discussed in their briefs and during their closing arguments. The Complaint explains--in precisely the same terms as Mr. Rutland's affidavit did--that Northeast securitized loans and removed recourse because of FIRREA's risk-based capital requirement. Compare Compl. ¶¶ 105-106 with PX 241 (Aff. of George P. Rutland, Apr. 1, 1991) ¶¶ 18-19; see Northeast Reply Post-Trial Br. at 78. Similarly, the Complaint explains--in precisely the same terms as Mr. Rutland's affidavit did--that Northeast ceased paying dividends in order to improve its core capital position. Compare Compl. ¶ 106 with PX 241 (Aff. of George P. Rutland, Apr. 1, 1991) ¶ 19; see Northeast Reply Post-Trial Br. at 76. Second, the government's mystification as to why Mr. Rutland and the Complaint would have discussed the securitization, the recourse removal, and the cessation of dividends if those

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Case 1:92-cv-00550-MCW

Document 172

Filed 03/14/2007

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actions were not caused by the breach is easily pacified. Both Mr. Rutland and the Complaint were simply walking through the efforts that Northeast undertook to deal with its capital deficiencies in the aftermath of FIRREA. See Compl. ¶¶ 92-106; PX 241 (Aff. of George P. Rutland, Apr. 1, 1991) ¶¶ 8-19. Because only FIRREA's exclusion of supervisory goodwill and cumulative preferred stock from regulatory capital breached Northeast's supervisory contracts but many components of FIRREA affected Northeast's capital profile, one cannot infer, though the government tries, that Mr. Rutland and the Complaint, by merely providing a narrative of the steps that Northeast took to improve its capital profile, were ascribing all of those steps to the breach. We did not make this point in our rebuttal closing argument because it struck us as too minor and too self-evident to raise at the end of a full day of oral argument.

Respectfully submitted, /s/ Charles J. Cooper Charles J. Cooper COOPER & KIRK, PLLC 555 Eleventh Street, N.W., Suite 750 Washington, D.C. 20004 (202) 220-9600 (202) 220-9601 (fax) Counsel of Record Of Counsel: Michael W. Kirk Vincent J. Colatriano David H. Thompson David Lehn COOPER & KIRK, PLLC 555 Eleventh Street, N.W., Suite 750 Washington, D.C. 20004 (202) 220-9600 (202) 220-9601 (fax) March 14, 2007

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Case 1:92-cv-00550-MCW

Document 172

Filed 03/14/2007

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CERTIFICATE OF SERVICE I hereby certify that on this 14th day of March 2007, copies of the foregoing were filed electronically. Notice of this filing will be sent by operation of the Court's electronic filing system to all parties indicated on the electronic filing receipt. Parties may access this through the Court's system.

/s/ Charles J. Cooper Charles J. Cooper COOPER & KIRK, PLLC 555 Eleventh Street, N.W., Suite 750 Washington, D.C. 20004 (202) 220-9600 (202) 220-9601 (fax) [email protected]