With the help of Nick Rizzo, I’ve done some basic number crunching on the FHFA lawsuits. I used three different metrics to see how aggressive any given lawsuit was: the number of individual named defendants; the total number of pages in the suit; and whether it asked for punitive damages. My favorite of the last form is the one taking aim at the Squid (which, incidentally, quotes Matt Taibbi at the bottom of page 77):
Goldman Sachs Mortgage Company, GS Mortgage Securities Corp. and Goldman, Sachs & Co.’s misconduct was intentional and wanton… Punitive damages are therefore warranted for Goldman Sachs Mortgage Company, GS Mortgage Securities Corp. and Goldman, Sachs & Co.’s actions in order to punish them, deter them from future misconduct, and protect the public.
In any case, here’s the league table. I calculated a total score by taking the number of pages in the lawsuit, adding the number of individual defendants multiplied by 10, and then adding an extra 100 points if the FHFA was asking for punitive damages. Click to enlarge:
JP Morgan (JPM), here, is the clear winner — until you realize that Bank of America (BAC) is split into three different parts. If you take Countrywide, Bank of America, and Merrill Lynch and add their scores together, then the total for BofA reaches 884 points, and no I’m not going to worry about double counting.
All silliness aside, the total number of named defendants here, including various different individuals and corporate entities, is a whopping 268, including a small amount of double-counting. This is a full-employment act for lawyers, and I’m pretty sure they’re going to be fighting this one out for a long time; I can’t imagine, having put all of this work into these suits, that the government is going to be remotely willing to simply give all of these banks blanket immunity as part of a global settlement with the 50 state attorneys general.
I’ll have more on the substance of the suits later; suffice to say that they’re strong, and aggressive, and exactly what I’ve been looking for for a while. These banks lied to investors when they put together mortgage securitizations. And one way or another, they’re about to start paying for that. About time too.