Bank Lawyer's Blog

Charlie Munger: A Favorite Curmudgeon

Warren Buffet's long-time running buddy, Charlie Munger, agrees with Cam Fine about one thing: it's time to break up (or at least "simplify") the big banks.

In an interview with CNN at Berkshire Hathaway's annual meeting, Munger, who is Warren Buffett's chief lieutenant, said he thinks the big banks are still too complicated and dangerous for the economy. But he doesn't think a recently proposed bill by Senators Sherrod Brown and David Vitter, which has gotten praise from others who want to rein in big banks, is the answer.

"I think if you increase the capital requirements and let them do what they want, they will just get in trouble again," says Munger.

Munger's preferred prescription sounds like a stricter version of the Volcker Rule, which was meant to limit risky trading at the banks and was included in Dodd-Frank, but has yet to be implemented. He would force the banks to get out of their business of underwriting and trading derivatives, financial contracts that allow you to speculate, some say hedge, on commodities, interest rates, and other things. About a year ago, JPMorgan Chase (JPM) announced it had lost billions on a credit derivative hedge that had not worked out as expected.

As CNN reporter Stephen Gandel notes, Munger's words carry additional weight, because he's calling for action against banks like Wells Fargo and Bank of America, institutions in which Berkshire Hathaway has sizable investments.

Munger thinks that big banks should be more heavily regulated, and that more regulation will be just what the profit doctor ordered. "By getting out of risky businesses, banks may end up giving back much less of their bull market gains in the down years" He thinks that banks should stick to their knitting, lending. "The ideal bank is pretty boring." I agree.

Gandel thinks that if Munger actually believes that more regulation and smaller size lead to greater profits, then he has a fiduciary duty to Berkshire's shareholders to press banks like Bank of America to pare down their size and accept tighter regulation (instead of unleashing the lobbyists on Congress).Munger thinks that's the job of the regulators. I'd argue it's the role of Congress, but I'd also agree with Munger that Berkshire Hathaway isn't going to persuade Bank of America to accept being broken up or buried under an avalanche of more regulation.

Munger said he and Buffett make investment decisions based on the world they are in, not what they wished it to be, which is fair.

Like Buffet, Munger has always pretty much said what he thinks. As he ages, he's not becoming any less candid. It makes for an interesting interview.

A Bad Idea That Refuses To Die

Even though municipalities like San Bernardino have come to their senses and dropped a make-your-investment-banker-rich-quick scheme to seize underwater mortgages from mortgage lenders and wrote down the principal balances, the scheme refuses to completely die. I guess we'll have to use holy water, garlic, mirrors, fire, crucifixes and wooden stakes to stamp it out. In the interim, SIFMA continues to publicly pummel it.

In a recent post on its Pennsylvania + Wall blog, SIFMA's Timothy Cameron reiterates why those municipalities still considering this likely unconstitutional scheme to abandon it.

The proposals being touted target a very narrow slice of homeowners – those that are in private-label MBS and who are current on their existing mortgages, have good credit, and ideally don’t have existing home equity loans or other liens on the property. Those who are behind on their mortgage payments or have poor credit (which is the vast majority of homeowners needing help) will get no relief.

Within the small pool of qualifying homeowners, the proposal, on its face, will substantially undervalue their homes. In one example, the mortgage that investors would get paid $160,000 for is refinanced shortly thereafter for $190,000, with much of the additional $30,000 going to the plan’s backers after costs and a kickback to the municipality are accounted for. This is not fair compensation, since the amount paid is well below the face value of the taken note, and significant profits accrue to private parties.

In addition to the legal issues, the use of eminent domain will also be immensely destructive to U.S. mortgage markets in general and to specific communities using eminent domain, in particular. If the sanctity of the contractual relationship between a borrower and a creditor is undermined by the use of eminent domain, both lenders and investors will be reluctant to provide funding in the future. The result will be a significant contraction of credit availability, particularly in communities that have exercised eminent domain to seize loans. It will be much harder to get a loan: any loans that are granted will likely require much larger down payments, stronger credit scores and higher interest rates to compensate for this new and unprecedented risk. This contraction of credit availability would likely serve to halt any recovery in the municipality’s housing market, and could further depress housing values in the cities using eminent domain.

The last reason may be the most telling. Good luck with the future availability of affordable residential mortgage credit in your soon-to-be dustbowl of a community if you enact this scheme. The investment fund gets wealthy, of course, which is the impetus for this half-baked plan. All to help, but not so much, a narrow slice of the community.

Bad ideas never die. They never seem to fade away, either, unfortunately.

Gimme A Break! Nobody Actually Believed Us!

To answer a reader's question, yes, I did get a kick out of the argument by S&P's lawyers (paid subscription required) that statements by S&P "about independence and objectivity are 'puffery' and were never meant to be taken at face value by investors."

Standard & Poor's responded formally on Monday to the civil lawsuit that the Justice Department filed against the company on Feb. 4 in U.S. District Court in Los Angeles.

The federal government says that the rating firm committed fraud when it allegedly misrepresented its ratings as independent and objective.

In its formal defense filed Monday, S&P pointed to two earlier court decisions where judges ruled that such statements by the firm were puffery and therefore can't form the basis for a fraud claim.

[...]

"Even if it's a viable legal argument, it's a pretty unattractive argument for S&P to be putting forward since they're basically in the business of charging clients for their reputation," said Samuel Buell, a law professor at Duke University and a former federal prosecutor. "What they're saying here is, 'When we're talking to investors about our own reputation, we're engaging in meaningless puffery.' "

"That's the whole point of the rating agencies, their seal of approval," Mr. Buell said.

It's hard to argue with Professor Buell about that.

Predictably, this all drove Larry Doyle over the edge.

In conclusion, the statement made by S&P’s lawyer is the equivalent of throwing another log on the fire that is incinerating any sense of meaningful integrity within the Wall Street-Washington conspiracy.

Puff . . . puff . . . up in smoke!

You may want to do the same with any credit ratings that cross your desk from S&P and its industry brethren at Moody’s and Fitch.

As hard as this is to believe, I'm going to say that the provision of Dodd-Frank that requires the regulators to figure out an alternative to the rating agencies is justified, not merely by the facts, but by the damning words flowing from the rating agencies and their mouthpieces. The problem is, thus far, no one has figured out what that alternative might be.

One option on the table is a proposal by Sen. Al Franken (D., Minn.) to create a board that would assign rating firms to rate deals. "As this lawsuit unfolds, it only becomes more clear that the credit rating industry is in need of serious reform, and that the American people and our economy are still at risk as a result of the conflict of interest in the industry," Mr. Franken said in a statement.

Wait a minute: I just agreed with Al Franken. Don't tell anyone. This moment may pass.

Uh, oh. I think Hell just froze over.

Scapegoating 101

The 20/20 hindsight afforded members of Congress when judging the alleged failures of the independent foreclosure reviews that we discussed last night also graces the peepers of the Government Accountability Office.

The independent foreclosure reviews abruptly ended by regulators in January failed from a lack of objectivity, oversight and consistency in the loan sampling process, said Lawrance Evans, director of financial markets and community investment for the Government Accountability Office.

[...]

Despite having a large portion of the funds already in the mail to homeowners, Evans says GAO’s probe into how the IFR was handled is far from complete.

He told lawmakers GAO plans to conduct more studies on how regulators came up with the $8.5 billion settlement figure when there is no data to show how that number was chosen or exact calculations on how many homeowners were, in fact, harmed by foreclosures.

He pointed out that "regulators’ statistical sampling approach did not include mechanisms to allow the regulators to monitor consultants’ progress toward finding as many harmed borrowers as possible."

Without data on how many borrowers were actually harmed, the GAO representative says his office wants answers on how the compensation figures were determined by the OCC and Federal Reserve.

In other words, the beat(ing) will go on.

And On.

And on.

While that's going on, the regulators are going all passive-aggressive by asking Congress to clarify that the regulators have the power to take enforcement action directly against independent contractors for banks. Because, you know, if the regulators require banks, as part of related enforcement orders, to hire independent consultants to perform very expensive services in order to comply with the enforcement orders, and the lack of clear, or even consistent, instructions on what the criteria and processes should be to perform those services leads to later criticism of the regulators over those services, well, then, regulators must be able to blame somebody, and looking in the mirror is simply out of the question (vampires cannot see their own reflections). Thus, the regulators must be able to blame the independent contractors and pursue them via enforcement processes that give the regulators a leg up on the object of their (lack of ) affection. Just like banks.

The independent contractors are reacting badly to the regulators' reaction (paid subscription required).

"I'm not sure having the regulators regulate consultants would make them more independent," said Jon Winick, president of bank advisory firm Clark Street Capital. "A better idea is to have the regulators hire the consultant then."

That would be a good alternative, except then the regulators would be responsible for the consultants' performance (or lack thereof), and we can't have that. They must be able to blame either the banks, the consultants, or both. That's not possible if the regulators are in a position to bear any responsibility.

"To me, the whole thing about the consultants is just more scapegoating," said Walter Moeling 4th, a partner at the Bryan Cave law office.

Man, I'm glad I'm not as cynical as Walt. Personally, I think this is all just a legitimate disagreement among well-intentioned people who are not worried about covering their own backsides, deflecting blame, or promoting themselves at the expense of others, but only about trying to "do the right thing."

Second-Guessing the Second Guessers

Every once in awhile, the blustering blunderbuss known as Senator Liz ("She-Reams-For-Sport") Warren fires a scattershot salvo that strikes a worthy target. You know, like when Dick Cheney shot a lawyer in the face.

The other day, Princess Rides-Bankers-Like-A-Burro was grilling some representatives of the big-time independent foreclosure review firms at a hearing that only Democrats attended (so you know it wasn't going to be pro-banker) and, as related by Larry Doyle, she struck oil.

Senator Warren: I just want to take a look at the Independent Foreclosure Review Payment Agreement details. I think you’ve probably all seen this one page agreement that lists all of the things that the banks did wrong and then boxes for how many people fall into each category and how much money they’re going to be paid. Is that right? You’ve all seen this? [Panel indicates they have seen it.]

And this was put out – who put this out? I think this is put out by the OCC and Federal Reserve. Is that right? As part of the settlement details. So I just want to ask you about this.

It has some pretty amazing categories here. The first category is about service members who were protected by Federal law whose homes were unlawfully foreclosed. It’s got people who were current on their payments whose homes were foreclosed. It’s got people who were performing all of the requirements under a modification who lost their homes to foreclosure.

And it tells how many people fall into each category and how much money the people in that category will receive. And, it ultimately resolves what will happen to 3,949,896 families.

So the question I have is having resolved this nearly 4 million families, who put the people, the families, into each of these boxes. Is that what your firms did. Mr. Ryan?

Owen Ryan, Partner, Deloitte & Touche LLP: No, Senator, we did not.

Senator Warren: So who put them in.

Ryan: I’m not sure how that schedule is prepared. I saw it for the first time yesterday.

Senator Warren: Mr. Flanagan?

James Flanagan, Leader, U.S. Financial Services Practice, Pricewaterhouse Coopers LLP: Same response. We were not involved in the accumulation of that information.

Senator Warren: Mr. Alt?

Konrad Alt, Managing Director, Promontory Financial Group: Senator, I’ve seen the schedule but I’m not familiar with the basis for its preparation.

Senator Warren: So let me understand this. You ran the independent reviews, right. That’s what you got paid to do. And yet, I presume, the only one left is the banks must have put them in these boxes and you made no independent review of their going into these boxes. You were not asked to do that? Mr. Alt.

Alt: No Senator, we were not asked to do that.

Senator Warren: Mr. Flanagan. 

Flanagan: No we were not.

Senator Warren: Mr. Ryan.

Ryan: We were not Senator.

Senator Warren: So that leaves us with the banks that broke the law were then the banks that decided how many people lost their homes because of their lawbreaking. And, as a result, how many people would collect money in each of these categories. Is that right Mr. Alt?

Alt: Senator, I’m not familiar with the basis for the scheduling. 

Senator Warren: So far as you know, there’s no independent review of the banks’ analysis…you looked at 100,000 cases and the banks have now put 4 million people into categories and resolved finally how much they will get from this review by the OCC and the Federal Reserve.

Sweet!

As Mr. Doyle put it, "Bang up job on behalf of the American taxpayer from these individuals and their firms charged with an independent review of this settlement process. NOT!!"

But here's a word in defense of the consulting firms: when Mr. Alt said that it wasn't in the scope of their duties, he was not kidding. As one of my readers, a bank lawyer, advised me, the entire review process was FUBAR from the get-go.

I saw it up close and it was an absolute Rube Goldberg process with the scope, criteria and objectives changing constantly. Regulatory example 1001 of do as I say, not as I do.

It's always easy to use 20/20 hindsight to bash people, of course. However, since the regulators love to do it to bankers, I guess turnabout is fair play.

Unaccountably Unaccountable

Famed criminal defense attorney F. Lee Bailey once a stated that if he were charged with a crime and was, in fact, innocent of that crime, he would prefer to be tried by a military court of justice. He thought that military officers were disciplined to apply the law and the applicable rules fairly. I have no idea whether Bailey's view is supportable or not. However, I do know that if I'm guilty as charged, my best chance of beating the rap is to be tried by a jury of my "peers."

They were charged with "defiant trespass."

But after a Common Pleas Court jury on Tuesday acquitted the 12 Occupy Philadelphia protesters arrested in a 2011 bank sit-in, the trial judge shook their hands and called them the "most affable group of defendants I've ever come across."

"I think what this really shows is that when the people of Philadelphia make a decision, they want someone accountable," said Aaron Troisi, a 26-year-old working toward a master's degree in education at Temple University. "Accountability and justice is not what they experienced with banks like Wells Fargo."

Troisi's view of accountability would be labeled "ironic" if he was just a tad more self-aware. Instead, I'd label it "clueless."

The defendants were found guilty by a judge in municipal court, but were given the right to have the case retried by a jury in Common Pleas Court. As so many defendants facing substantial evidence of their guilt have previously discovered (including The Juice and Robert ("Don't Do The Crime If You Can't Do The Time") Blake), when a group of your average citizens decides to apply the law to the facts, whatever feels right is likely to rule the day.

The original charges of trespass were brought by the Philadelphia District Attorney's Office after the defendants trespassed on private property (the inside of a bank branch office) as part of the nationwide Occupy This-and-That-and-Also-That-Thing-Over-There movement. It seemed like a slam dunk case, especially when the municipal court judge agreed. But after 13 hours of hard deliberation, the jury decided that it was an episode of "Boston Legal," where jury nullification is just part of the way a jury ought to roll. The linked article doesn't say, but I'm wondering whether, at any point in the defendants' counsel's summation, a rotund attorney stood up from the defense table, eyed the jury, uttered two words ("Denny Crane"), and then sat down. If so, the verdict makes sense.

The trial judge not only shook the defendants' hands, she told them to soldier on in "La Cause."

Afterward, Judge Nina N. Wright Padilla took the unusual step of coming down from the bench and asking all 12 to approach so she could shake their hands.

"I hope you continue your work in a law-abiding way," said Padilla.

In Philadelphia, "law-abiding" apparently does not apply to abiding by trespass laws, at least where the property owner is a large bank.

In an upside down world, the defendants displayed a firm grasp of logic.

"If this jury has found us innocent, then it must mean that Wells Fargo is guilty," said 71-year-old Willard R. Johnson, one of the 12 on trial.

I need to see the diagram of the syllogism that led Willard from Point A to Point B. On second thought, forget it.

According to the article, the jury bought defense counsels' arguments that the First Amendment protected the defendants and that even if the actions did violate the law, "the protest served a greater good for society that trumped the trespass charge."

"The greater good" trumps the rule of law. In Robert Bolt's play "A Man For All Seasons," Thomas Moore replies to his future son-in-law, Roper, a Christian zealot who claims that he'd cut down every law in England to get at the Devil.

Oh? And when the last law was down, and the Devil turned 'round on you, where would you hide, Roper, the laws all being flat? This country's planted thick with laws from coast to coast– man's laws, not God's– and if you cut them down—and you're just the man to do it—do you really think you could stand upright in the winds that would blow then? Yes, I'd give the Devil benefit of law, for my own safety's sake.

Beware of modern day zealots, who claim to "speak truth to power," and who would cut down any law that stands between them and "the common good."

Missing The Mark

In her attempt to grandstand at a Senate Banking Committee hearing last Thursday, Liz Warren screwed up the chance to make a valid point. The freshman Senator and veteran ideologue tried to beat up the federal banking regulators who were arrayed before the committee over their supposed reluctance "to take Wall Street banks to trial." You can watch her performance in the linked video, starting at approximately the 1 hour, 34 minute mark.

Although her opening question as to how tough the regulators were was never actually answered, I'm surprised that not one of the regulators answered "Tough enough to take anything a punk like you can throw at me without blinking, Running Joke." Instead, when she followed up by asking when was the last time any of the regulatory agencies took a Wall Street bank to trial, the least likely of all contenders stepped into the ring and counterpunched with a deft lesson in basic administrative law that sailed over the head of She Will Sioux (and over the heads of those droolers who applauded her).

Curry's point was that the OCC doesn't need to sue because it twists arms effectively enough in almost all cases to achieve its supervisory goals through consent orders, without commencing litigation. Warren's follow up, to the effect that she knows that the OCC doesn't have to bring banks to trial but when was the last time it brought a bank to (an unnecessary?) trial, caused Curry to again state that it doesn't have to sue banks (actually, commence an administrative enforcement action) to achieve its supervisory goals. Liz moved on to her next victim, who needed to check her facts and get back to the Senator at a later date.

Liz then got to the impetus for her initial inquiry, and it turns out to be a valid point that was made, unfortunately, before the wrong audience. She claimed that US attorneys throughout the country were taking "ordinary citizens" to trial all the time and "squeezing them" (and not like your main squeeze squeezes you, either), but were not taking Wall Street banks to trial. There's a case to be made that she's right about that. If there had been an actual US Attorney on the panel before her, that point would have been telling. Instead, those testifying were FEDERAL BANKING REGULATORS. THEY CAN'T BRING CRIMINAL CHARGES AGAINST ANYONE, LIZZIE. ONLY A US ATTORNEY CAN DO THAT AT THE FEDERAL LEVEL!

Sorry to monetarily channel the spirit of the late Sam Kinison, but Liz was a celebrated (for her "diversity") member of the Harvard Law School faculty, who made her bones by taking shots at banks, and who also birthed the concept of the CFPB. God forbid she should actually understand that when you're chapped at federal officials for not bringing big banks and bankers to trial on criminal charges, the federal officials you want in the room are those who have the power to bring people to trial on criminal charges.

If Liz actually knew something about the subject matter at hand (which would have made her unique among her compatriots in the US Senate), she might have realized that Comptroller Curry's agency could be criticized for persecuting the little guys, while being strangely passive with respect to some Masters of the Universe. At least, you seldom, if ever, hear about the "hot pursuit" by the OCC of executives at Chase, Bank of America, or Wells Fargo. 

Some of you may remember Patrick Adams, the former bank president who fought the OCC to clear his name and who was backed by a federal administrative law judge, who recommended that all charges against him be dismissed by the Comptroller of the Currency. Instead of dropping the case, rumor has it that the OCC has objected to the ALJ's decision and has urged the Comptroller not to follow the recommendation of the ALJ. Had she been aware of what is actually what, Ms. Warren might have asked the Comptroller why the OCC fights to the bitter end to pursue charges against folks like Mr. Adams, and whether it also aggressively pursues Wall Street bankers with the same zeal. She might have asked Curry to name the last time the OCC tried to overturn an ALJ's recommendation to drop charges against a Wall Street banker. Curry would have suffered instant aphasia, but it would have been a useful line of questioning to those of us who understand the difference between a criminal trial and a civil administrative enforcement proceeding.

But, no, Liz played to the cheap seats, including her acolytes in the trade press, and got her round of cheap applause from her targeted audience.

San Bernardino Calls It Quits

San Bernardino County is the birthplace of the first serious consideration by a local government to implement a scheme concocted by former Clinton administration officials and private equity pirates to steal seize underwater mortgages from the lenders in order to write down the principal, refinance them into FHA loans, and sell those loans to new investors (enriching the investment bankers who would fund the scheme). It’s also the place that, when residents publicly objected to the scheme, thumbed its nose at its constituents and forged forward.

Fortunately for all that is right and holy in the land of fruits and nuts, San Bernardino recently came to its senses and abandoned the crackpot plan and opted to submit a request for proposal “seeking plans to address the mortgage crisis.” Given their track record, I suspect they’ll receive and seriously consider plans from the Hells Angels to turn foreclosed homes into profitable meth labs and from Maxine Waters to buy bad loans from whatever financial institution her husband owns these days. I mean, if you’re going to abuse the 14^th Amendment, you might as well throw all caution to the winds and just let fly with whatever comes to mind, whether tethered or untethered to reality.

Although the county’s CEO claimed that the threat of eminent domain was interfering with the ability of the county to work on other “solutions” with lenders and mortgage security investors, and that it was “wrong” to impose “unintended consequences” of the loan seizure scheme on residents who didn’t want it in the first place, anyone with an ounce of grey matter in his or her cranium knew of those negative aspects from the outset. Thus, the local yokels at county hall wasted a lot of time stirring the pot, to no avail. However, they have given the voters the appearance of “doing something” and in politics, appearance always trumps substance.

San Bernardino isn’t the first local governmental entity to attempt to play a fruitless populist (i.e., anti-bank) card to win a PR coup concerning the residential mortgage meltdown. We all recall those geniuses back East who have tried to hold lenders responsible for the condition of abandoned homes they don’t even own and for other consequences of economic and social forces beyond any lender's control. When will voters wise up and kick these time wasters to the curb?

You’re right: when Hell freezes over.

Hot Off The Press

Although scores of law firms are grinding out client alerts on last Friday's recess appointment kerfuffle and its potential impact on the CFPB, I'm already growing tired of the issue, largely because I'm easily bored and thinking about it also cuts into my Miller Time (or, more accurately in my case, Shiner Bock Time). Before putting it to bed for a nap, however, I thought I'd provide links to some decent discussions of the issue.

The first is put out by Pillsbury, and authored by Joseph T. Lynyak III, Rodney R. Peck and Michael J. Halloran. It expands on many of the themes Joe Lynyak communicated to me last week and that I included in a post from a couple of days ago. It does a good job of outlining the issues and potential consequences in terms even lesser lights in the bank law space (such as this author) find comprehensible. It states that it's intended only as a starting point. If so, you'll be off to a good start by reading it.

The folks at Ballard Spahr also issued a cogent preliminary analysis. Although the firm is conducting a webinar on February 4 on the topic (link provided in the client alert), and they'll save most of the "good stuff" for that, I especially liked the following observation, with which I agree:

We believe Canning’s political reverberations will extend beyond the fight over President Obama’s renomination of Mr. Cordray to include the revival of proposed legislation to convert the CFPB’s leadership from a single director to a board or commission. The legislation also calls for the Financial Stability Oversight Council to oversee CFPB regulations and would subject the CFPB to the Congressional appropriations process.

Finally, DavisPolk's client memorandum on the subject contains a section that discusses some interesting "wrinkles," including various arguments that might be offered to uphold the regulations issued under Cordray's watch. It's a worthwhile read, as you would expect, given that firm's consistently high quality output.

I'll be moving on to other topics in future posts, reserving the right to revist this burning issue as it slowly evolves.

A Deal Is A Deal

AIG's moment of temporary insanity has passed. It's decided not to join a shareholder lawsuit filed by a company controlled by former AIG CEO Hank Greenberg against the US Government for bailing AIG out in 2008. Actually, Hank's company didn't allege that fact of the bailout was itself wrongful, just that the bailout terms set by the government were wrongful. Everyone understands that when you're going down like a torpedoed garbage scow, you always sue the guys who threw you a life preserver because they didn't reel you in quickly enough and you caught a nasty cold.

AIG's board of directors was apparently worried about reputational risk. Given the bad taste left in the collective mouth of the American public by the Wall Street bailouts, that's probably a justified worry. Politicians of all stripes were publicly uttering variations on the theme of "WTF?" on a daily basis. On the other hand, David Boies (yes, THAT David Boies), the attorney for Greenberg's company (which is the plaintiff in the litigation), thinks that the board's decision was not in the best interests of the shareholders. I assume that's a vague threat of a lawsuit against the directors of AIG. It seems to me that if Greenberg goes that route, he'll first have to win the lawsuit against the government in order to prevail against the directors. I'd think he'd have his hands full on with the suit against the government, without taking on the additional defendants. Then again, I don't swim in that specific shark tank, so I assume my rube-like perceptions and opinions are of little interest to the masters of the universe.

There were some other interesting, and even amusing, observations on AIG's board's decision. The Cato Institute's Mark Calabria astutely observed that big financial institutions rarely sue the federal government "because if they did, the government might not bail them out next time." Rim Shot!

On the other hand, AIG's CEO Robert Benmosche told CNCB that AIG believed that "a deal is a deal." Really, Bob? You danced with the bear and you still said that to a reporter without cracking yourself up? "A deal is a deal" as long as you're not the US government, which believes in honoring its deals unless it's politically expedient to renege on them, in which case it just litigates the resulting lawsuits for a decade or more until the public's interest in the outcome has been long since diverted to one or more other shiny baubles.

I understand the public relations downside as a reason to back off suing the US government. However, the "a deal's a deal" rationale simply doesn't hold water, based upon the nature of the devil with whom the deal was made.