Defending Dick Fuld | FT Alphaville

Defending Dick Fuld

Dealbook notes that Dick Fuld has a friend. It’s Harvey Miller of US law firm Weil, Gotshall & Manges, who defends the former Lehman CEO in the filing below – a motion in opposition to the NY State comptroller’s appointment of a bankruptcy examiner (Anton Valukas).

You can read the whole defence here. Here’s a taste of the Fuldery:

The Comptroller’s motion is fatally defective. In lieu of credible evidence, the Comptroller has resorted to unfounded accusations, rumors and gross speculation to accuse the Debtors’ management, and in particular, the Chairman and former Chief Executive Officer, Richard S. Fuld, with gargantuan misconduct, incompetence and mismanagement without a single shred of substantive supporting proof.
The Comptroller fails to recognize that Lehman was a victim of a financial tsunami that was beyond its control. The Comptroller blithely ignores that under the long term leadership of Mr. Fuld, Lehman had become one of the premier independent investment banking concerns in the world and had steadily provided significant returns to its investors, employees and shareholders. Likewise, the Comptroller is oblivious to the critical facts that caused the financial meltdown that engulfed Lehman and, generally, the financial markets, including, inter alia, the failure of government authorities to appropriately regulate and oversee financial markets and the deficiencies of rating agencies. The unsupported blunderbuss accusations of the Comptroller are insufficient to establish cause under the Bankruptcy Code.

Is ignorance really a viable defence? Apparently. Dick Fuld shouldn’t, of course, be a scapegoat, but it was on his watch that Lehman threw itself into the mortgage-backed securities business with such élan. It is disingenuity of the highest order to suggest that banks like Lehman were passive victims of a stormy market. Their actions created the stormy market in the first place. Dick Fuld’s Lehman reaped what it sowed.

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