Free Witness List - District Court of Federal Claims - federal

Case 1:92-cv-00550-MCW

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS NORTHEAST SAVINGS, F.A., ) ) Plaintiff, ) ) v. ) ) THE UNITED STATES OF AMERICA, ) ) Defendant. ) )

No. 92-550C ( Judge Williams)

DEFENDANT'S TRIAL WITNESS LIST Pursuant to paragraph 15 of Appendix A to the Rules of the United States Court of Federal Claims, defendant, the United States, respectfully submits this list of witnesses we expect to present at trial as part of our case-in chief and/or for rebuttal purposes, with the exception of those witnesses that may be called for impeachment purposes. We reserve the right to revise or supplement this list as permitted by the Rules and the Court's orders. In particular, we reserve the right to omit witnesses at trial should their testimony become unnecessary, and to call any witness necessary to lay the foundation for the admissibility of any exhibit. In addition to the topics listed below, each witness may additionally testify upon any topics that were the subjects of their prior testimony, including affidavits and depositions, regarding any exhibit presented at trial by the parties, and in rebuttal of the testimony offered by plaintiff at trial.

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WITNESSES THAT THE GOVERNMENT EXPECTS TO CALL AT TRIAL 1. W. Barefoot Bankhead Navigant Consulting 2001 Ross Avenue Suite 500 Dallas, TX 75201

Mr. Bankhead is a Director of Navigant Consulting, Inc., a firm providing advisory services in finance and accounting to businesses and individuals, as well as a certified public accountant since 1978. His other credentials are described in his expert report. Mr. Bankhead will provide testimony concerning how Northeast accounted for the goodwill for regulatory and GAAP purposes as well as the write-off of the goodwill in 1990 and 1992. Mr. Bankhead will also provide testimony responding to Dr. Baxter's calculation of divested assets and replacement assets and their corresponding lost profits. Mr. Bankhead will further provide testimony addressing the spread used by Dr. Baxter to compute lost profits. Mr. Bankhead will also proffer testimony addressing counterfactual assumptions made by Dr. Baxter including his assumptions regarding but-for Northeast's continued reliance upon wholesale activities and its interest rate risk profile. Mr. Bankhead will additionally respond to Dr. Baxter's calculation of excess deposit insurance premiums, including the impact of his reversal of an adjustment made by Northeast to the goodwill. Finally, Mr. Bankhead will provide other opinion testimony concerning damages claims made by plaintiff in this case, not set forth above, as described in his expert report and/or discussed during his deposition and will respond to any new contentions that plaintiff makes during the trial that are relevant to his previously expressed opinions. Estimated time for direct examination: 4 hours

2.

Grant M. Clowery 2

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1601 N. Kent St. Suite 1201 Arlington, VA 22209 Mr. Clowery is a consultant on accounting and economic matters, specializing in, among other things, taxation. He possesses an MBA and a Ph.D. in business from the University of Chicago and a J.D. from George Mason University. In addition, Mr. Clowery has been a certified public accountant since 1990. Mr. Clowery will provide opinion testimony concerning the "tax gross-up" included in the damages calculations presented by Dr. Nevins Baxter, as described in his expert report and/or discussed at his deposition. Mr. Clowery will also respond to any new contentions that plaintiff makes during the trial that are relevant to his previously expressed opinions. Estimated time for direct examination: 1 hour 3. Daniel R. Fischel Lexecon, Inc. 332 South Michigan Avenue Chicago, IL 60604

Professor Fischel is Director, Chairman and President of Lexecon, Inc., a consulting firm that specializes in the application of economics to legal and regulatory issues. He is also Professor of Law and Business at Northwestern University School of Law and Kellogg School of Management and the Lee and Brena Freeman Professor of Law and Business Emeritus at The University of Chicago Law School. He has served previously as Dean of The University of Chicago Law School, Director of the Law and Economics Program at the University of Chicago Law School, and as Professor of Law and Business at The University of Chicago Graduate School of Business. Professor Fischel received his J.D. degree from The University of Chicago Law School in 1977. His other credentials are described in his expert report. Professor Fischel 3

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will discuss the benefit that Northeast obtained from the actions it took to maintain capital compliance after the enactment of FIRREA and its implementing regulations. Professor Fischel will also testify concerning the principal flaws in Dr. Baxter's damage calculations including his speculative and implausible assumptions concerning (i) size, (ii) the composition of the assumed foregone assets, (iii) the profitability of the assumed foregone assets, (iv) the cost of the assumed foregone liabilities, (v) securitization, (vi) the DEPCO transaction, (vii) the cancelled rights offering, and (viii) deposit insurance premiums. Finally, Professor Fischel will also provide opinion testimony concerning damages claims made by plaintiff in this case, not set forth above, as described in his expert report and/or discussed during his deposition, and he will respond to any new contentions that plaintiff makes during the trial that are relevant to his previously expressed opinions. Estimated time for direct examination: 4 hours 4. Thomas C. Kovac Senior Thrift Examiner Office of Thrift Supervision Department of the Treasury 35 Braintree Hill Office Park Suite 201 Braintree, MA 02184

Mr. Kovac is a Senior Thrift Examiner in the Northeast Regional Office of the Office of Thrift Supervision, in Braintree, Massachusetts. He has examined thrifts since 1977, and was involved in examinations of Northeast from 1986 until approximately 1993. He may testify regarding Federal thrift regulation generally, Federal regulation of Northeast, Northeast's operations and performance, the impact of FIRREA upon Northeast, Northeast's response to FIRREA including its capital plan, Northeast's branch and asset sales, Northeast's sale to

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Shawmut Bank, and in response to opinions and testimony expressed by plaintiff's witnesses. Estimated time for direct examination: 2 hours 5. Anjan V. Thakor Olin School of Business Washington University Campus Box 1133 One Brookings Drive St. Louis, MO 63130-4899

Professor Thakor is the John E. Simon Professor of Finance at the John M. Olin School of Business, Washington University in St. Louis, Missouri. His teaching, research and consulting expertise lies primarily in Corporate Finance and Banking. Professor Thakor received his Ph.D. in Finance from Northwestern University in 1979. His other credentials are described in his expert report. Professor Thakor will provide testimony explaining how the conceptual flaws in Dr. Baxter's analysis renders it unreliable as a matter of economic and finance principles. For example, Professor Thakor will explain how selling assets at fair market value could not have caused harm to Northeast and that the breach did not deprive Northeast of the opportunity to profit from declining interest rates. Professor Thakor will also provide testimony responding to Dr. Baxter's assumption regarding the but-for size of Northeast. Professor Thakor will further provide testimony explaining how Dr. Baxter's lost profits model produces damages via an ex post gamble on the direction of interest rates. Professor Thakor will also provide an explanation of why Dr. Baxter's computation of damages related to the DEPCO transaction is excessive and his calculation of excess deposit insurance speculative. Professor Thakor will additionally demonstrate why Dr. Baxter's calculation of the "cash value of regulatory capital" is inconsistent with basic principles of finance theory. Finally, Dr. Thakor will provide opinion testimony concerning damages claims made by plaintiff in this case, not set 5

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forth above, as described in his expert report and/or discussed during his deposition and will respond to any new contentions that plaintiff makes during the trial that are relevant to his previously expressed opinions. Estimated time for direct examination: 4 hours REMAINING WITNESSES THE GOVERNMENT MAY CALL AT TRIAL 1. Albert J. Brenner c/o Ethel Walker School 230 Bushy Hill Road Simsbury, CT 06070

Mr. Brenner was employed by Northeast Savings, F.A. ("Northeast") as a Vice President in 1986 and was ultimately promoted to Senior Vice President and Executive Vice President and Treasurer over the course of his tenure with the institution, until 1995, when Northeast merged with Shawmut Bank. While employed at Northeast, Mr. Brenner was involved with the preparation of business plans and with interest rate risk issues. He may testify regarding Northeast's operations and performance, its business plans, interest rate risk, the impact of FIRREA upon Northeast, Northeast's response to FIRREA, including its capital plan, Northeast's branch and asset sales, Northeast's sale to Shawmut Bank, and in response to opinions and testimony expressed by plaintiff's witnesses. Estimated time for direct examination: 1 hour

2.

Harold Chapman 2201 Hillshire Court Columbia, Mo 65203

Mr. Chapman was an examiner with the Federal Deposit Insurance Corporation ("FDIC"). 6

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Mr. Chapman was the examiner in charge for Notheast's 1993 FDIC report of examination. He may testify about the findings and conclusions of this report and other reports he is familiar with. He may also testify about Northeast's operation in the early 1990's. He may also testify about Northeast's asset quality problems as well as its interest rate risk policies and profile. Mr. Chapman may additionally testify about the effect, if any, of the phase out of goodwill upon Northeast's operations. Estimated time for direct examination: 1 hour 3. Howard G. Carpenter, Jr. 1396 Rowe Road Niskayuna, NY 12309

Mr. Carpenter was employed by Schenectady Savings, and then Northeast, as general counsel from 1981 until 1993. Prior to that, he served as outside counsel to the thrift. He may testify regarding Northeast's and its predecessor's acquisitions, Northeast's operations and performance, its business plans and strategic planning, the impact of FIRREA upon Northeast, Northeast's response to FIRREA, including its capital plan, Northeast's branch and asset sales, and in response to opinions and testimony expressed by plaintiff's witnesses. Estimated time for direct examination: 1 hour 4. James J. Gavin 96 Sexton Avenue Westwood, MA 02090

Mr. Gavin was an examiner with the Office of Thrift Supervision ("OTS"). He may testify various regulatory examinations of Northeast that he conducted both before and after FIRREA. His testimony may include a description of Northeast's operations, risk profile and examination ratings. It may also include the effect, if any, of the phase out of goodwill upon

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Northeast's operations. Estimated time for direct examination: 1 hour 5. Donald M. Kaplan

Dr. Kaplan was the founder of the consulting firms Kaplan, Smith & Associates and Kaplan Associates. The topics about which Dr. Kaplan may testify include the analyses and studies that he and his firm performed for Northeast in the 1980s and 1990s. Estimated time for direct examination: 1 hour 6. Kevin McCarthy Newport Savings Bank 100 Bellevue Avenue Newport, Rhode Island

Mr. McCarthy was a supervisory agent employed by the Federal Home Loan Bank. He was one of Northeast's regulators during the 1980s. He may testify about Northeast's condition prior to the passage of FIRREA, including the risks inherent in its wholesale portfolio. He may also testify about regulatory concerns related to Northeast's operations and discussions regarding these concerns with Northeast. Estimated time for direct examination: 1 hour

7.

Michael P. Moriarty Field Manager II Office of Thrift Supervision 35 Braintree Hill Office Park Braintree, MA 02814

Mr. Moriarty was an OTS examiner. He may testify about Northeast's operations in the 8

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early 1990s. He may also testify about Northeast's asset quality problems as well as its interest rate risk policies and profile. Mr. Moriarty may also testify about the effect, if any, of the phase out of goodwill upon Northeast's operations. Estimated time for direct examination: 1 hour 8. Kevin James O'Keefe 777 Main Street Hartford, CT 06115

Mr. O'Keefe is currently Vice President of the Managed Asset Division at Fleet Bank. At Northeast Savings, he served as Assistant Vice President from 1988 to 1990, Vice President from 1990 to 1992 , and Senior Vice President from 1992 to 1995. He may testify regarding Northeast's operations and performance, the goodwill that is the subject of the breach in this case, Northeast's reaction to FIRREA, the impact of FIRREA on Northeast, and other financial issues faced by the institution during his tenure. Estimated time for direct examination: 1 hour Defendant reserves the right to call in its case-in-chief any witnesses listed on plaintiff's witness list. We also reserve the right to call any witness identified by the plaintiffs in their witness list that may later be withdrawn before trial. Defendant also reserves the right to call any rebuttal witnesses and any witness necessary to lay the foundation for the admissibility of trial exhibits if plaintiff does not stipulate to the admissibility of those exhibits. Should any witness be unable to testify in person due to some infirmity or otherwise, we reserve the right to seek the Court's permission for leave to present that individual's testimony at trial, where appropriate, by video-teleconferencing, or, alternatively, where warranted, by the introduction of deposition testimony in accordance with the Court's rules

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and procedural orders. Respectfully submitted,

STUART E. SCHIFFER Deputy Assistant Attorney General

DAVID M. COHEN Director JEANNE E. DAVIDSON Deputy Director

/s/ William F. Ryan WILLIAM F. RYAN Assistant Director

Of Counsel: SCOTT AUSTIN MELINDA HART ELIZABETH HOSFORD JEFFERY INFELISE SAMEER YERAWADEKAR Trial Attorneys Department of Justice

/s/ Tarek Sawi TAREK SAWI Trial Attorney Commercial Litigation Branch Civil Division Department of Justice Attn: Classification Unit 1100 L St., N.W. Washington, D.C. 20530 Tele: (202) 616-0323 Fax: (202) 307-0972 Attorneys for Defendant

September 15, 2006

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CERTIFICATE OF SERVICE

I certify under penalty of perjury that on this 15th day of September, 2006, a copy of the foregoing "DEFENDANT'S TRIAL WITNESS LIST " was filed electronically. I understand that notice of this filing will be sent to all parties by operation of the court's electronic filing system. Parties may access this filing through the Court's system.

/s/ Tarek Sawi Tarek Sawi