To: bkarp@paulweiss.com, plinden@kmllp.com
CC: kwhitehouse@nypost.com
Sent: 4/8/2013 5:34:17 P.M. Central Daylight Time
Subj: In re Citigroup Securities Litigation Master File No. 07 MDL CIV 9901 (SHS)
BY US MAIL [mailed 4/15/12]
United States District Court
Southern District of New York
Daniel Patrick Moynihan United States Courthouse
500 Pearl Street
New York, NY 10007-1312
IN RE CITIGROUP SECURITIES Master File No. 07 MDL CIV 9901 (SHS)
LITIGATION
:::::
ECF CASE
RESPONSE OF FORMER UNITED STATES DISTRICT JUDGE LAYN R. PHILLIPS
TO MY EMAIL SERVED ON THE PARTIES PER HIS INSTRUCTION
To the Honorable United States District Court of the Southern District of New York:
I am an amicus curiae objector and have previously submitted my objection to the Court.
As I said in a supplemental letter to the Court dated March 25, 2013, I sent an email to Former United States District Judge Layn R. Phillips regarding his Declaration to the Court, dated November 19, 2012, and Mr. Phillips sent me a reply email that said I should serve my email on the parties to give them an opportunity to comment before Mr. Phillips responded. I proceeded to make this service as recited in my March 25th letter to the Court (which includes the complete text of my email to Mr. Phillips and of Mr. Phillips' email to me).
This morning I emailed Mr. Phillips saying I had not seen any comments from the parties or a response from Mr. Phillips. Mr. Phillips sent me the following email back:
From: LPhillips@irell.com
To: RDShatt@aol.com
CC: bkarp@paulweiss.com, plinden@kmllp.com, kwhitehouse@nypost.com
Sent: 4/8/2013 3:59:41 P.M. Central Daylight Time
Subj: RE: You Citigroup declaration; my email; no comments or response yet
Dear Mr. Shattuck:
I cannot respond to any inquiries about the content of mediation briefs or about the nature of caucus sessions during the mediation process. As was set forth in my filed declaration, based upon my experience, I believe the settlement was fair and achieved at arm’s length. I have not been presented with any law or precedent where individuals who unknowingly benefit from artificial stock inflation are liable or where the reasonableness of a settlement of this nature is related to the potential effect it might have on other possible wrongdoers. My perspective remains unchanged by your email, and I will not modify my declaration.
Furthermore, I cannot address how the Court might view the underlying litigation. I encourage you to direct future communications to the Court and counsel of record, as I am neither the judge nor an advocate in this this matter.
Thank you.
Layn R. Phillips
Former District Judge.
I consider Mr. Phillips' response very inadequate. This may be because Mr. Phillips is legally constrained from giving an adequate response or it may be for other reasons.
If Mr. Phillips' understanding of the law is correct, I think, if the Honorable Court approves the settlement and attorneys fees, the Court's order should expressly state that, under the law, the amount of any recovery to which the plaintiffs are entitled is entirely independent of any deterrent purpose or deterrent effect of the litigation (i.e, if there was a jury trial, the jury would be instructed that it should give no consideration to whether the litigation serves to deter others), and that the reasonableness of the settlement (and the appropriateness and reasonableness of attorneys fees) are evaluated and judged independently of the deterrent effect (or lack of deterrent effect) of the settlement. (The Court might be interested in how the lead plaintiffs and their attorneys in the Bank of America case tout in their press release the deterrence effect of the Bank of America class action and settlement.)
Also, my email asked Mr. Phillips the following:
Am I correct that it was entirely unknown at the time of the settlement (and will never be known), the extent to which selling shareholders who sold during the artificially inflated period will walk away with windfall gains that are beyond the reach of the Court (if the shareholders completely sold out) or the amounts of windfall gains that they are allowed to keep will be kept in disregard of the relative amounts of their respective windfall gains, and the extent to which there is any "recovery" of those windfall gains will is unknown, and instead of "recovery" of windfall gains, there is effectively a reallocation of losses among purchasers who had losses or to shareholders who had no gain or loss from the alleged wrongdoing?Mr. Phillips' response says that no recovery of the windfall gains in the pockets of selling shareholders may be possible under the law. That is hardly an answer to the criticism that, in this lawsuit, where the windfall gains are not being, and/or cannot be, recovered from the pockets of those who received the windfall gains, it is not doing justice to, in substance, reallocate losses among those who incurred losses, and no answer to the argument that the same should be considered in what recovery should be allowed under the law and whether the settlement is fair and reasonable.
I am sending a paper copy of this email by U.S. mail to the Court. I will send this email only electronically to the parties, per the above email addresses.
Respectfully submitted,
Robert Shattuck
3812 Spring Valley Circle
Birmingham, AL 25223
(205) 967-5586
From: RDShatt@aol.com
To: mwb@blbglaw.com, steven@blbglaw.com, rkaplan@kaplanfox.com, ffox@kaplanfox.com, dkessler@ktmc.com, gcastaldo@ktmc.com, bkarp@paulweiss.com, dkramer@paulweiss.com, asoloway@paulweiss.com, jbernstein@labaton.com, rcs@cabaniss.com, pfruin@maynardcooper.com, blatham@bassberry.com, larry.polk@sutherland.com, kevinlogue@paulhastings.com
Sent: 4/14/2013 10:21:26 A.M. Central Daylight Time
Subj: Response of FORMER UNITED STATES DISTRICT JUDGE LAYN R. PHILLIPS
BY US MAIL
United States District Court
Southern District of New York
Daniel Patrick Moynihan United States Courthouse
500 Pearl Street
New York, NY 10007-1312
Clerk of the Court
United States District Court for the Western District of Tennessee
Clifford Davis/Odell Horton Federal Building
167 North Main Street, Room 242
Memphis, Tennessee 38103
IN RE BANK OF AMERICA CORP. Master File No. 09 MDL 2058 (PKC)
SECURITIES, DERIVATIVE, AND
EMPLOYEE RETIREMENT INCOME
SECURITY ACT (ERISA) LITIGATION
(Southern District of New York)
In re Regions Morgan Keegan Closed-End Fund Litigation, No. 07-cv-02830 SHM dkv
(Western District of Tennessee)
RESPONSE OF FORMER UNITED STATES DISTRICT JUDGE LAYN R. PHILLIPS
IN CITIGROUP CASE
To the Honorable United States District Court of the Southern District of New York: To the Honorable United States District Court of the Western District of Tennessee
I have previously advised the Honorable Courts of certain email communications between myself and Former United States District Judge Layn R. Phillips regarding his Declaration to the Court, dated November 19, 2012, filed in IN RE CITIGROUP SECURITIES LITIGATION Master File No. 07 MDL CIV 9901 (SHS), pending in the Southern District of New York.
Mr. Phillips has provided a further response regarding his Declaration, and I have written a letter to the Court in the aforesaid Citigroup case informing the Court about said further response.
I wish to provide the Honorable Court in the Bank of America case and the Honorable Court in the Regions Morgan Keegan case a copy of my aforesaid letter to the Court in the Citigroup case. Said letter is appended below.
I am sending a paper copy of this email by U.S. mail to the Honorable Courts. I will send this email only electronically to the parties in the Bank of America case and the Regions Morgan Keegan case, per the above email addresses.
Respectfully submitted,
Robert Shattuck
3812 Spring Valley Circle
Birmingham, AL 25223
(205) 967-5586
[see above for the appended letter in the US mail paper copy mailed to the Courts]
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