Mail Stop 3-09

							November 4, 2004


Glenn W. Anderson
President and Chief Executive Officer
GAINSCO, Inc.
1445 Ross Avenue, Suite 5300
Dallas, Texas 75202

Re:	GAINSCO, Inc.
	Preliminary Proxy Statement on Schedule 14A
	Filed 10/5/04
	File No. 1-09828

Dear Mr. Anderson:

	We conducted a limited review of your filing.  Our review was
limited to legal issues and did not include a review of the financial
statements and disclosures related to accounting issues.  Where
indicated, we think you should revise your document in response to
these comments.  If you disagree, we will consider your explanation
as to why our comment is inapplicable or a revision is unnecessary.
Please be as detailed as necessary in your explanation.  In some of
our comments, we may ask you to provide us with supplemental
information so we may better understand your disclosure.  After
reviewing this information, we may or may not raise additional
comments.

	Please understand that the purpose of our review process is to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other aspect
of our review.  Feel free to call us at the telephone numbers listed
at the end of this letter.

SCHEDULE 14A

General

1. Please include the information required by Items 3 and 23 of
Schedule 14A, as applicable.

2. Please provide us with a legal analysis of the applicability of
Rule 13e-3 of the Exchange Act in view of the fact that the
contemplated transactions may be the first step toward the delisting
of your common stock.  It appears the transactions could fall under
Rule 13e-3 by either subsection (a)(3)(i)(A), because you will be
purchasing your own securities from GMSP and Mr. Stallings, or
subsection (a)(3)(i)(C), because it is a proxy solicitation in
connection with a recapitalization.

3. Please unbundle both proposals so that investors will have the
opportunity to vote separately on all six components of the
proposals.  Shareholders should also have the opportunity to vote
separately on whether to reduce the number of directors from eight to
seven, as noted in the second bullet point on page 5.  You may
condition completion of the proposals on approval of all proposals.

Shareholder Letter

4. Please state the estimated amount of the transaction costs in item
(ii) and throughout your filing wherever you state the amount of cash
you expect to receive from the transactions.  It appears from page 54
that this amount is $2 million.

Purpose of and Reason for the Restructuring, page 2

5. It appears that the difficulties you hope to solve with the
recapitalization are a direct result of your decision in 2001 to call
the Series A preferred stock for redemption.  Currently, your filing
does not explain the reasoning behind this decision.  Please explain
why you decided to redeem the Series A preferred stock.  Include a
similar explanation in your future periodic filings in the discussion
of the transactions with GMSP.

The Recapitalization, page 3

6. In instances where you are proposing to issue common stock to
satisfy your obligation to pay the redemption price, please revise to
disclose the implied price per share.

Termination of the Recapitalization Agreements; Nonsolicitation, page
7

7. In your discussion of the obligation that the Series A Preferred
Stock vote on an as converted basis in proportion to the vote of all
shares of common stock voted on such matter, please revise to clarify
that the effect is that these votes will not have any effect on any
shareholder votes for the first two years following the consummation
of the transactions.

Shareholder Vote to Approve the Recapitalization Proposal and the
Employment Agreements Proposal, page 8

8. If approval of any of the proposals is assured, disclose that fact
here.

9. Disclose the percentage of the vote that your current Series A and
Series B Preferred shareholders control.

How was the exchange rate for the Series A Preferred Stock
determined? page 12

10. We note you used a value of $0.60 per common share in determining
how many shares to issue to GMSP and Messrs. Reis and Stallings.
Please disclose in this discussion, as you state in footnote (1) on
page 61, that your stock price as of August 27, 2004, the day before
announcement of the recapitalization, was $0.67.

11. We note your statement that the $0.60 per common share price is a
premium to the estimated book value per share.  Please revise to
disclose the estimated book value per share.

Why are the Proposals being submitted for approval by our
shareholders? page 15

12. Please state whether the Board might go forward with the
transactions even if shareholders do not approve them.  We note that
although shareholder approval is not required by law, the contracts
themselves are conditioned upon shareholder approval.

What are the U.S. Federal income tax consequences of the
restructuring to me? page 19

13. Did you obtain an opinion of counsel?  If you did, identify
counsel.  If you did not, please revise to state that you did not
obtain an opinion of counsel.  Similarly revise throughout your
document.

The Participants; Interest of Certain Persons In Matters to Be Acted
Upon, page 24

14. Despite this section`s title, it does not appear to discuss any
person`s interest in matters to be acted upon.  Please revise to
include the information required by Item 5 of Schedule 14A.

Background of the Recapitalization, page 30

15. We note at the end of the first paragraph of this section that
the acquisition you were considering "never developed to the point
that it was ready for Special Committee consideration."  Please
explain why this option was ultimately abandoned.

16. Near the top of page 31, you refer to pressures on you`re A.M.
Best rating.  Please revise to discuss the significance of A.M. Best
ratings, what such ratings are intended to demonstrate and state
whether you are currently being considered for a rating downgrade.

17. Please disclose the services Jackson Walker provided to Crescent
Real Estate Equities and Texas Capital Bancshares, and explain why
these services did not conflict with the services provided to the
Special Committee.

18. Please revise the last paragraph on page 32 to discuss Houlihan`s
findings regarding the December 2nd proposal.

19. Please revise the discussion of the March 2nd meeting to discuss
the reasons the negotiations with GMSP had been unsuccessful and the
information presented to the Audit committee and its impact on the
recapitalization.

20. In the third full paragraph on page 35, you state Jackson Walker
recommended the Special Committee hire additional or replacement
counsel due to, among other things, "the differences of business
judgment among Board members as to whether the company should pursue
the general agency opportunity prior to resolving its capital
issues."  Please clarify why these differences of opinion among Board
members influenced Jackson Walker`s ability to serve as counsel.

21. Supplementally, please furnish us with copies of any "board book"
or other material Sanders Morris Harris and the independent
compensation consultant furnished to board members in connection with
the transactions.  We may have further comments after we review this
material.

22. We note your disclosure that GMSP suggested that the Special
Committee should share its valuation analyses with GMSP.  Did the
Special Committee share these analyses?  If they did, you should
include them in your filing.

23. We note on page 39 that the independent compensation consultant
made a presentation to the Special Committee on August 23, 2004.
Please identify the consultant, summarize what they told the Special
Committee at the August 23 meeting, and include their consent to the
use of their name in your document.  Also, include their report in
your proxy.

24. Please identify the general agency with whom the company
contracted on September 30, 2004.  Also, provide additional
background about this agreement.  State when and why discussions
resumed with the general agency.

Opinion of the Special Committee`s Financial Advisor, page 41

25. Please supplementally provide to us a copy of the presentation
materials given to GAINSCO`s Board of Directors and Audit Committee,
as mentioned in item 3 on page 42.  Also, briefly summarize the
contents of these materials in your document.


Historical Stock Price Performance, page 46

26. We note that you the common stock performance of other companies
involved in the nonstandard auto insurance business.  Did you include
all companies in the nonstandard auto insurance business in your
analysis?  If not, please revise to identify the companies excluded
from the analysis and explain why they were not included.

27. We note that GAINSCO stock increased 141.4% while the comparable
companies and S&P 500 indices "remained relatively flat."  Please
clarify how Sanders Morris used this information in its fairness
analysis.  Did Sanders Morris believe this information supported the
fairness of the transactions?  Why or why not?  Also, please quantify
the increase or decrease in the comparable companies index and in the
S&P 500 index.

Market Approach - Guideline Company Multiples, page 47

28. Please clarify why Sanders Morris excluded Affirmative Insurance
Holdings, Hallmark Financial Services, and Vesta Insurance Group from
the Price/Earnings 2004E ratio.  Also, clarify which companies it
used for the Price/Earnings 2005P ratio.  If it excluded any of the
seven companies for this ratio, explain why.

Market Approach - Guideline Transaction Multiples, page 48

29. Please identify the 42 change-of-control transactions Sanders
Morris reviewed, and identify the 13 transactions that were less than
$100 million.

30. We note that footnote (1) to both the "Public Comparable
Transactions" table and the "Public Comparable Transactions <$100mm"
table indicates that the tables do not reflect outliers.  Please
identify these outlying transactions and their applicable ratios.

31. Please clarify whether the calculations of GAINSCO`s implied
equity value contained in the last paragraph of this discussion are
based on the 42 "Public Comparable Transactions" or on the 13 "Public
Comparable Transactions<$100mm."  State whether Sanders Morris made
any calculations based on the other list of transactions.  If they
did, you should include these calculations in your document as well.

General, page 53

32. In the second paragraph of this discussion, you state that the
summary "does not purport to be a complete description of the
analyses presented by Sanders Morris."  Please state that the summary
contains all material aspects of the analyses.


Proposal One: The Recapitalization Proposal, page 68

33. Please revise the first paragraph to disclose the implied value
of the common shares issued in the exchanges.

34. For each of the agreements discussed, please disclose whether the
agreements provide for termination fees.  If the agreements do
include such provisions, please revise to disclose this information
and to quantify these fees.

Stallings Investment Agreement, page 76

35. Since Mr. Stallings is your chairman, please disclose in the
"Interests of Certain Persons in Matters to Be Acted Upon" discussion
the amount of the fee provided in his investment agreement.  You
should state the total fee and the amount that is contingent upon
closing.  See Item 5(a)(1) of Schedule 14A.

Reis Investment Agreement, page 81

36. We note the statement in the middle of page 84 that "Mr. Reis has
personally committed to cause Reis LLC to have sufficient capital and
liquidity to fund its obligations at the closing under the Reis
Investment Agreement . . . ."  Please disclose whether Reis LLC
currently has enough funds available to pay these obligations.
Similarly, in the discussion of the Stallings Investment Agreement,
which starts on page 76, state whether Mr. Stallings currently has
enough funds to meet his payment obligation under the agreement.

Other Matters, page 100

37. We note your bylaws prohibit you from transacting business that
is not described in a notice to shareholders.  Please tell us
supplementally whether adjourning the meeting to solicit additional
proxies would be prohibited by this provision of your bylaws.  If it
would not be prohibited and it is possible that you might adjourn the
meeting to solicit additional proxies, your proxy card should include
a proposal allowing shareholders to vote on this action.  You would
also need to describe this proposal in the body of your document.

Proxy Card

38. We note you will allow shareholders to vote through the internet.
Please supplementally provide us with images of all screens
shareholders may encounter.  Alternatively, provide us with your
company number, a "dummy" proxy number, and an account number so that
we may access the screens ourselves.

FORM 10-K

39. Please address the following comments regarding your Form 10-K
and your 6/30/04 Form 10-Q in future filings, beginning with your
Form 10-Q for the quarter ended 9/30/04.

Item 10. Directors and Executive Officers of the Registrant, page 42

40. Please describe Mr. Goff`s, Ms. Buehler`s, and Mr. Wisdom`s
business experience for the past five years, including the dates when
they held their various positions.

Legal Proceedings, page 25

41. With respect to the securities lawsuit, please state when this
action was filed, identify the two officers, and explain the factual
background in more detail.  We note from page 34 of your 6/30/04 Form
10-Q that a second, apparently related, lawsuit was filed on March
29, 2004.  If the facts for the two lawsuits are identical, make that
fact clear.

Employee Benefit Plans, page 95

42. Please disclose information about your equity compensation plans
in the tabular format prescribed in section II.A.1 of Release No. 33-
8048 (Feb. 1, 2002).

6/30/04 FORM 10-Q

A.M. Best Rating, page 26

43. We note your A.M. Best rating is "B-."  Please state how many
possible ratings A.M. Best has, and state where "B-" ranks.

*	*	*

	As appropriate, please amend your proxy statement in response to
these comments.  You may wish to provide us with marked copies of the
amendment to expedite our review.  Please furnish a cover letter with
your amendment that keys your responses to our comments and provides
any requested supplemental information.  Detailed cover letters
greatly facilitate our review.  Please understand that we may have
additional comments after reviewing your amendment and responses to
our comments.

	We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to be
certain that they have provided all information investors require.
Since the company and its management are in possession of all facts
relating to a company`s disclosure, they are responsible for the
accuracy and adequacy of the disclosures they have made.

	In connection with responding to our comments, please provide,
in writing, a statement from the company acknowledging that

* the company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

	In addition, please be advised that the Division of Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

	Please contact Greg Belliston at (202) 824-5219, Suzanne Hayes
at (202) 942-1789, or me at (202) 942-1840 with any other questions.

							Sincerely,



							Jeffrey Riedler
							Assistant Director

cc:	Byron F. Egan
	Jackson Walker L.L.P.
	Bank of America Plaza
	901 Main Street, Suite 6000
	Dallas, TX 75202
Glenn W. Anderson
GAINSCO, Inc.
November 4, 2004
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