Current Year Case Updates
|Case Updates for 2001|
Prior Case Updates for: 2012—2011—2010—2009—2008—2007—2006—2005—2004—2003—2002—2001
Letter to our shareholders
We are frustrated by the delay in receiving Judge Smith's
decision. Trial on the issue of damages finished on September 17, 1999. The
latest word we have is from a telephone conference call between myself, the
government attorney, and the administrator of the savings and loan cases, which
took place over two weeks ago. At that time, we were told we would receive the
decision "very soon". Judge Smith is working on two other decisions: Glendale
Federal and Meritor, and ours is supposed to be first.
Our attorney Don Willner, contacted the Court Clerk, William Schultz on October 18th. The conference call also included the government’s attorney. Mr. Shultz indicated that an “order” expected in the next day or two would identify a date for the court’s decision and announcement. It was estimated that the period between the order and the decision would be about three weeks. This information was not posted on the Web site because of past disappointments with regard to the timing of the court’s activities. The order has yet to be delivered.
purpose of this up-date is to reassure you that our attorney is just as anxious
as we all are for a decision and is doing everything he can to bring this case
to a conclusion, including periodic phone calls with Mr. Shultz.
More information will be posted as it becomes available.
US Court of Appeals Issues Decision
Government's Position in Related Cases Weakened
Our attorney, Don Willner, has provided the following:
We are still waiting
for Judge Smith's decision, which we hope will be soon. In the meantime, the
United States Court of Appeals for the Federal Circuit, which is the court above
the U.S. Court of Federal Claims in which Judge Smith sits, has recently issued
a favorable decision in the case of Bluebonnet Savings Bank v. United States.
In the Bluebonnet case another Judge of the Claims Court, not Judge Smith,
denied Bluebonnet any loss of profits damages on the grounds that it failed to
prove the amount of damages "to a reasonable certainty". The Federal
Circuit reversed saying "where responsibility for damage is clear, it is
not essential that the amount thereof be ascertainable with absolute exactness
or mathematical precision. It is enough if the evidence adduced is sufficient to
enable a court or jury to make a fair and reasonable approximation".
Benj. Franklin was seized in 1990 and on this part of our claim we had the task
of proving what Benj. would have been worth at the time of
trial in 1999 if it had not been seized. The Government's response has always
been that is all speculation. In the Bluebonnet case the Federal Circuit says
"we have also allowed so-called 'jury verdicts' if there was clear proof of
injury and there was no more reliable method for computing damages - but only
where the evidence adduced was sufficient to enable a court or jury to make a
fair and reasonable approximation"..."In estimating damages, the Court
of Claims occupies the position of a jury under like circumstances; and all that
the litigants have any right to expect is the exercise of the court's best
judgment upon the basis of the evidence provided by the parties."
In other words, "a fair and reasonable approximation" of the value of Benj. Franklin in 1999 is sufficient. We believe there is clear proof of injury-the Government destroyed Benj. Franklin. According to Bluebonnet, we do not have the impossible task of proving exactly what would have happened in the next nine years. No one knows what impact the Bluebonnet decision will have upon our case, but we believe it should be helpful.
|Posted: 9/28/01||We, of course, are as disappointed as you that the long awaited decision did not come by the end of August as indicated on this site. While the reason for the delay is unknown, it could have been delayed further by the national tragedy which befell America on September 11th. For whatever reason, we and our attorney, Don Willner, remain optimistic that a decision will be coming shortly.|
Conference Call Reveals Timeline for Judge Smith's Decision
August 8th, our attorney, Don Willner participated in a
conference call with the Government attorney, Jonathon Lawlor
and William Schultz, the Special Master of the Court of
Federal Claims for the savings and loan cases. In this call,
Mr. Schultz said, “Judge Smith is aiming to get this case
decided by the end of this month”.
The “aiming” is obviously not a commitment but it
certainly means that the decision should be coming soon.
expect Northwest newspapers to publish the decision once it is
reached. And, of course a synopsis will be printed here as
soon as possible.
Court Rules on Two Cases
All Remain Hopeful That Judge Smith is Close to a Decision
there are rumors of an early decision from Judge Smith, all we
can do is hope that the rumors are correct.
decisions have been issued by the U.S. Court of Appeals for
the Federal Circuit. Both
are factually different from the Benj. Franklin case. Landmark
Land Company received as restitution damages the amount of
assets that it contributed to bolster the failing thrift. It
was unsuccessful in obtaining the use value of these assets
because the court found the evidence unconvincing. We, on the
other hand, are seeking the value of Benj. Franklin with its
88 branches if it had continued in existence, an issue not
involved in Landmark.
L. Glass, the Federal Circuit ruled that the shareholders
were not intended third party beneficiaries of the contract
between their company and the government and therefore had no
standing to sue the government directly.
very different from our case where Judge Smith has granted the
shareholders standing in our derivative suit brought on the
behalf of the corporation, Benj. Franklin.
In both the
Landmark and Glass, the Federal Circuit denied
the Federal Deposit Insurance Corporation (FDIC) the right to
sue the United States for the deficit in the receivership
where the FDIC claim is less than what the failed thrift owed
the government. The reason is that any such claim would only
be transferring money within the government.
News from the MeritorPSFS Web Site
(The following is reprinted from Meritor/PSFS website, a S & L similar to Ben Franklin.)
Posted June 26, 2001
A recent article in the Seattle Times, May 19th, "Big Stakes Battle Embroils Thrift" is a reprint from the Spokane-Review which tells the story of Sterling Thrift Association's failed efforts to reach a settlement with the government. An interesting read.
BENJ Shareholders File Brief
April 24, 2001, we filed our opening brief with the U.S. Court
of Federal Claims, discussing the impact of the Glendale
Federal and California
Federal decisions of the Federal Circuit Court of Appeals
on our case. The
issue is what measure of damages is appropriate.
connection with our primary claim for expectancy or loss of
profits damages, our attorney, Don S. Willner, emphasized in
our brief the statement of the Federal Circuit that, “If a
reasonable probability of damages can be clearly established,
uncertainty as to the amount will not preclude recovery.”
Since Benj. Franklin with its 88 branches was
destroyed, we believe we have clearly established a reasonable
probability of damages. The
brief also points out that we tried to deal with the
uncertainty of the profits that Benj. would have made from
1990 to 1999 by making conservative assumptions.
expectancy damages cannot be proven, then we are seeking the
back up measures of damages of restitution (the benefit
conferred upon the government) or reliance (the actual loss
sustained by Benj. Franklin).
government’s brief continued to emphasize their argument
that our damages are zero. They also say that we have waived the right to seek reliance
briefs are due by May 15.
We hope that Judge Smith will then decide the case.
Court of Appeals Renders Decision in
April 2, 2001, the Court of Appeals for the Federal Circuit
decided the case of California Federal Bank, FSB v. United States, which is a helpful
precedent for our case.
The Federal Circuit stressed:
goodwill was the subject of our contract and the fact of
damages is that Benj was seized and destroyed, but there is
uncertainty as to the amount of our damages.
Also: Our attorney, Don S. Willner, has requested a one-week extension for the briefs, so that all parties can discuss the impact of both the Glendale and California Federal opinion. The opening briefs would be due on April 24th and the reply briefs on May 15. Hopefully, a decision by the Court will then follow.
Judge Issues Order in BENJ Case
February 27, 2001, our attorney, Don S. Willner, filed a
motion that the parties be allowed to file briefs within 20
days discussing the impact of the Glendale Federal
decision in our case. Senior
Judge Loren A. Smith has now entered this Order:
On February 27, 2001, plaintiffs filed a motion for an early telephone conference to allow filing of supplemental briefs concerning the recent Glendale decision from the Federal Circuit.
The court believes that additional briefing would be useful, but does not believe that conference is needed to schedule a briefing. Accordingly, the parties shall file briefs, no longer than 20 pages, on the impact of the Glendale decision on the plaintiffs’ case for damages, no later than April 17, 2001. In order that the parties can respond to arguments raised in these briefs, the parties may file responsive briefs, no longer than 10 pages, by May 4, 2001.
/s/ Loren A. Smith
February 16, 2001 the United States Court of Appeals for the
Federal Circuit decided the predecessor case of Glendale
Federal v. United States.
The decision is important for our case.
Glendale Federal (‘Glen-Fed’) Chief Judge Smith in the
U.S. Court of Federal Claims denied loss of profits damages,
and granted restitution and reliance damages in the amount of
Glen-Fed did not appeal the denial of loss of profits
The Appeals Court ruled ‘that the Government’s
promise that was breached had substantial value’.
The Appeals Court then ruled that the restitution
measure of damages was too speculative, but reliance damages
The case was then sent back to Judge Smith to
recalculate reliance damages.
The probable result is that Glen-Fed will receive
substantial damages, but less than the $909,000,000 previously
awarded by Judge Smith.
case depends on its own facts.
In our case, we are seeking loss in profits damages.
We were seized and destroyed while Glen-Fed was not.
We are also seeking restitution damages and reliance
damages as defined by the Appeals Court.
It may be that Judge Smith was delaying his decision waiting for guidance from the Court of Appeals. We hope that our decision will come out relatively soon.
Suggested Reason for Delay
Web site visitors
and others have suggested that Judge Smith’s decision will
not be rendered until the Appeals Court rules on the Glen
Fed/Cal Fed case. We
have no information to either support or refute this
the Appeals Court does not provide notice as to when it will
announce it's ruling. Therefore,
if as suggested, Judge Smith’s ruling is contingent upon the
Glen Fed/Cal Fed case, the forecast for a BENJ ruling remains
We wish to thank everyone for submitting comments and for continued interest in the BENJ Shareholder Fund. Stay tuned.
Most Frequently Asked Question
the most frequently asked question is, "When will Judge
Smith render a decision on our case?"
short answer is, we cannot say for sure.
we did learn through that a stockholder in Mississippi was
successful in getting Senator Trent Lott to query the
Department of Justice on our behalf.
Here is a portion of the letter that the stockholder
received in response:
"Finally, as you know, the Justice Department has no control over when a court issues its decision. We can report, however, that, at a Winstar - related case management conference on October 17th, 2000, the judge presiding over Suess indicated that it was his ‘goal’ to issue decisions in Suess and three other related cases ‘in the next six months’.”
The letter was signed, David W. Ogden, Assistant Attorney General, Washington, D.C. 20530, December 15th, 2000.
If the Judge holds true to his intent, a decision should be rendered by mid-April, 2001. We realize that most of you are losing patience and we don't blame you. Ten plus years is a long, long, time to wait for anything. We will update this website whenever we have something to report or to answer your questions. Stay tuned!
We, the original plaintiffs, are very grateful for the response we have received from this Website. We are just as discouraged by the delay in Judge Smith's decision as you, especially when legal expenses are incurred each and every month. We cannot emphasize enough how fair Don Willner and his firm have been during the past ten years. It was, therefore, very disappointing that we have received only $130.00 as a result of the Website. The cost of the ad in the Oregonian announcing the website was over $400.00!
Our list of stockholders, to the best of our knowledge, is the only one in existence. It includes the records of the Bank's transfer agent of ten years ago. Our list will be given to the appropriate government agency to be appointed by the court if we prevail. We believe that our list will insure promptness in locating shareholders. If you know of anyone that may not have seen this Website, we ask that you advise them to contact us. You would be doing them a great favor.
We are still preparing answers to your questions and will post them on a separate page in the near future. Please continue to monitor this site weekly.
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