The Plaintiffs In
The Case Of
Benj. Franklin Federal Savings and Loan (BENJ)
the United States
was Benj. Franklin Federal Savings and Loan Association?
Founded in 1925 in Portland, Oregon, Benj.
Franklin was a large, successful and widely respected thrift when it was seized
by the federal government in 1990.
Who brought the case?
Shareholders of Benj.
Franklin brought this suit on September 14, 1990, in the United States Court of
Federal Claims with the help of Don S. Willner, a prominent and well respected
Portland, Oregon, attorney, on behalf of an estimated 6,500 shareholders.
What was the condition of the thrift industry in 1982?
Interest rates were over 15% at a time when
the thrift industry was invested in long-term mortgages charging about 8%.
The entire industry was on the verge of bankruptcy, as was the FDIC,
the government agency that insured the thrifts to protect the depositors.
What was the government’s response to
It encouraged healthy
thrifts to acquire failing thrifts with various government incentives,
including treating the minus net worth of the failing thrift as the capital
asset of goodwill and writing it off over a long period of time.
This program was known as Supervisory Goodwill Agreements.
What is this suit?
As part of this government program, Benj.
Franklin in 1982, by agreement with the government, acquired a failing thrift,
Equitable Savings and Loan in return for a 40-year amortization of the
supervisory goodwill. Benj. and the government made a similar agreement in 1985
concerning the acquisition of Western Heritage Savings and Loan.
These agreements had the full approval of the Federal Home Loan Bank
Was this 40-year agreement necessary?
Benj. Franklin nor the federal government would have
entered into this agreement if not for the 40-year
lengthy time period was necessary for Benj. to recover
the Equitable losses through economies resulting from
the merger and from use of Equitable’s unusual
franchise to do business in Washington and other states.
What happened to Benj. Franklin between 1982 and 1989?
It prospered, expanded, made a profit in 16
consecutive calendar quarters and became the number one mortgage lender in the
Portland metropolitan area and had strong lending positions in other major
areas of the northwest.
What happened to the thrift industry in 1989?
especially in the southwestern United States, defrauded investors and
depositors. Congress responded by
passing a law in 1989 called FIRREA, which among other provisions, retroactively
revoked agreements for the long-term amortization of goodwill.
With the goodwill removed, Benj. Franklin was instantaneously declared
insolvent and was seized by the government on February 21, 1990.
How does the lawsuit stand?
government is expensive and lengthy. Over
4,000 shareholders have contributed to the funding
of the suit, most at a fair share of 25 cents per
1995, Chief Judge Smith ruled that these
shareholders had the right to bring this suit (“shareholder
1996, the U.S. Supreme Court ruled in a companion
case that the government had breached its contract
for long term amortization of goodwill.
In 1997, the Judge decided that the government breached its contract with
Benj. (granting “summary judgment on liability”).
Trial on the issue of how much damages should be awarded started on
January 11, 1999, and with frequent intervals,
finished on September 17, 1999.
Our experts testified that the value of Benj. at the time of trial if it
had not been seized would have been $944,000,000. Government experts testified that the damages to Benj. due to
the seizure was zero! We
do not know when the case will be decided, but hope
it will be soon.
How have we been keeping the shareholders informed?
Over the ten-year period, we have written
eleven up-dating reports to those shareholders whose names we have in our
records. Benj. has not had a transfer agent for many years.
We believe our extensive but incomplete list of shareholders is the
only accurate one in existence. The
accuracy of our list, in our opinion, is assured by way of funding
contributions of $.25 per share, by many who agree and support our cause.
Of the 7,705,000 that were issued, well over 2,000,000 shares are missing.
Could this be you? We invite you to join with us to expand and further insure
the accuracy of ownership list, as well as promptness in locating you, if we
win. Send all checks in the
amount of $.25 per share to:
S. Willner, Trustee
(Benj. Franklin Shareholders Litigation Fund)
1415 The American Bank Building
621 SW Morrison Street
Portland, OR 97205
name, address, phone number, and exact amount of shares.
Why did we establish this website?
We want to do an even
better job of communicating with the shareholder family.
If you have additional questions, please click “on contact”.
We will periodically update the website with answers to your question.
We will also provide you with information on the progress of our