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.

In this country we have separation of powers between the executive, Congress, and judiciary! The Federal Judiciary has always been very independent, and pressure from the executive or Congress would be resented and counter productive. Letters from parties, such as our shareholders, would not be welcome, since the U.S. Claims Court rules provide that the only communications to a judge must come from the attorney of record (myself) with a copy to the opposing government attorney.

I understand and share the pain that all of us are suffering from the delay. I frequently get the advice of other savings and loan attorneys about what to do. Many others also have their own delays. There are some group efforts underway to speed up the process for all cases, which I cannot discuss.

Please do not do anything, however well meaning, which would actually not help our case.

Sincerely yours,

Willner Wren Hill & U'ren

Don S. Willner
Attorney for the Plaintiffs in the Benjamin Franklin Litigation

US Court of Appeals Issues Decision 
in Bluebonnet Case

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.

Conference Call Reveals Timeline for Judge Smith's Decision

On 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.

We expect Northwest newspapers to publish the decision once it is reached. And, of course a synopsis will be printed here as soon as possible.

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 
Judge Smith held a three-hour hearing this afternoon to listen to arguments from attorneys for Glendale Federal Savings and the government as to how he should adjust his $909 million damages award to GlenFed in light of the Federal Circuit's ruling last February that instead of focusing on restitution, he should use a "reliance" remedy instead. GlenFed argued that even under "reliance", they are still entitled to $862 million in damages. The government -- as it has done and continues to do in all 120 supervisory goodwill lawsuits (including Meritor/PSFS and Ben Franklin, which were seized and put out of business), argued that the damages are zero because no harm was done. (Honest!)

At the conclusion of the hearing, Judge Smith told the assembled attorneys that while he expected to rule as expeditiously as possible, there are two other pending cases which he intends to get out first. He identified them as Suess v. the United States (Ben Franklin Savings, Portland, Oregon) and Slattery v. the United States (Meritor/PSFS).

Both Suess and Slattery have been waiting for a ruling from Judge Smith for over one year now. Hopefully, we will be hearing something before too much longer. 

Posted June 14, 2001 
It has been exactly one year since the Slattery/Meritor case was submitted to Judge Smith for a verdict. We have no idea when Judge Smith will issue his decision, but we hope that it will be soon. While we are obviously disappointed in how long it is taking him to rule, we remind our fellow shareholders that thanks to the Court of Appeals decision in the GlenFed case, Judge Smith has a "full plate" at the present time. We are confident that while it perhaps will take longer than most of us would like, Judge Smith will eventually "do the right thing".

Be even more patient than you have been. 

BENJ Shareholders File Brief

On 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.

In 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.

If 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).

The 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 damages.  (We disagree.)

Reply briefs are due by May 15.  We hope that Judge Smith will then decide the case.  

Judge Issues Order in BENJ Case

On 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:

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

                                                                        Senior Judge

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 supposition.

 Furthermore, 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 unknown. 

 We wish to thank everyone for submitting comments and for continued interest in the BENJ Shareholder Fund.  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.