SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 13G
(Rule 13d-102)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULES 13d-1(b)(c), AND (d) AND AMENDMENTS THERETO FILED
PURSUANT TO RULE 13d-2(b)
(Amendment No. )
USG Corporation
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
903293405
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(CUSIP Number)
December 31, 2007
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(Date of Event Which Requires Filing of this Statement)
Check the appropriate box to designate the rule pursuant to which this
Schedule is filed:
[x] Rule 13d-1(b)
[_] Rule 13d-1(c)
[_] Rule 13d-1(d)
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(1) The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter the disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
CUSIP No. 903293405
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Fairholme Capital Management, L.L.C.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [x]
3. SEC USE ONLY
4. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware, United States of America
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
5. SOLE VOTING POWER
0
6. SHARED VOTING POWER
5,897,600
7. SOLE DISPOSITIVE POWER
0
8. SHARED DISPOSITIVE POWER
6,613,036
9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,613,036
10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[_]
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
6.7%
12. TYPE OF REPORTING PERSON*
IA
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP No. 903293405
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Bruce R. Berkowitz
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [x]
3. SEC USE ONLY
4. CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
5. SOLE VOTING POWER
0
6. SHARED VOTING POWER
5,897,600
7. SOLE DISPOSITIVE POWER
0
8. SHARED DISPOSITIVE POWER
6,613,036
9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,613,036
10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[_]
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
6.7%
12. TYPE OF REPORTING PERSON*
IN, HC
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP No. 903293405
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Fairholme Funds, Inc.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [_]
(b) [x]
3. SEC USE ONLY
4. CITIZENSHIP OR PLACE OF ORGANIZATION
Maryland, United States of America
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
5. SOLE VOTING POWER
0
6. SHARED VOTING POWER
5,590,800
7. SOLE DISPOSITIVE POWER
0
8. SHARED DISPOSITIVE POWER
5,590,800
9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,590,800
10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES*
[_]
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
5.6%
12. TYPE OF REPORTING PERSON*
IC
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP No. 903293405
Item 1(a). Name of Issuer:
USG Corporation
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Item 1(b). Address of Issuer's Principal Executive Offices:
550 West Adams Street, Chicago, Illinois 60661
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Item 2(a). Name of Person Filing:
Fairholme Capital Management, L.L.C.
Bruce R. Berkowitz
Fairholme Funds, Inc.
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Item 2(b). Address of Principal Business Office, or if None, Residence:
Fairholme Capital Management, L.L.C.
4400 Biscayne Boulevard, 9th Floor
Miami, FL 33137
Bruce Berkowitz
c/o Fairholme Capital Management, L.L.C.
4400 Biscayne Boulevard, 9th Floor
Miami, FL 33137
Fairholme Funds, Inc.
c/o Fairholme Capital Management, L.L.C.
4400 Biscayne Boulevard, 9th Floor
Miami, FL 33137
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Item 2(c). Citizenship:
Fairholme Capital Management, L.L.C.- Delaware, United States of America
Bruce R. Berkowitz - United States of America
Fairholme Funds, Inc. - Maryland, United States of America
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Item 2(d). Title of Class of Securities:
Common Stock
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Item 2(e). CUSIP Number:
903293405
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Item 3. If This Statement is Filed Pursuant to Rule 13d-1(b), or 13d-2(b)
or (c), Check Whether the Person Filing is a:
(a) [_] Broker or dealer registered under Section 15 of the Exchange Act.
(b) [_] Bank as defined in Section 3(a)(6) of the Exchange Act.
(c) [_] Insurance company as defined in Section 3(a)(19) of the Exchange
Act.
(d) [x] Investment company registered under Section 8 of the Investment
Company Act.
(e) [x] An investment adviser in accordance with Rule 13d-1(b)(1)(ii)(E);
(f) [_] An employee benefit plan or endowment fund in accordance with
Rule 13d-1(b)(1)(ii)(F);
(g) [x] A parent holding company or control person in accordance with
Rule 13d-1(b)(1)(ii)(G);
(h) [_] A savings association as defined in Section 3(b) of the Federal
Deposit Insurance Act;
(i) [_] A church plan that is excluded from the definition of an
investment company under Section 3(c)(14) of the Investment
Company Act;
(j) [_] Group, in accordance with Rule 13d-1(b)(1)(ii)(J).
Item 4. Ownership.
Provide the following information regarding the aggregate number and
percentage of the class of securities of the issuer identified in Item 1.
6,613,036 shares of Common Stock of USG Corporation are owned, in the aggregate,
by various investment vehicles managed by Fairholme Capital Management, L.L.C.
("FCM") of which 5,590,800 are owned by Fairholme Funds, Inc. Because Mr.
Berkowitz, in his capacity as the Managing Member of FCM or as President of
Fairholme Funds, Inc., has voting or dispositive power over all shares
beneficially owned by FCM, he is deemed to have beneficial ownership of all such
shares so reported herein.
While the advisory relationship causes attribution to Bruce Berkowitz, Fairholme
Funds, Inc. or FCM of certain indicia of beneficial ownership for the limited
purpose of this Schedule 13G Amendment, Bruce Berkowitz, Fairholme Funds, Inc.
and FCM hereby disclaim ownership of these shares for purposes of
interpretations under the Internal Revenue Code of 1986, as amended, or for any
other purpose, except to the extent of their pecuniary interest.
(a) Amount beneficially owned:
Fairholme Capital Management, L.L.C.: 6,613,036
Bruce R. Berkowitz: 6,613,036
Fairholme Funds, Inc.: 5,590,800
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(b) Percent of class:
Fairholme Capital Management, L.L.C.: 6.7%
Bruce R. Berkowitz: 6.7%
Fairholme Funds, Inc.: 5.6%
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(c) Number of shares as to which such person has:
(i) Sole power to vote or to direct the vote
Fairholme Capital Management, L.L.C.: 0
Bruce R. Berkowitz: 0
Fairholme Funds, Inc.: 0
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(ii) Shared power to vote or to direct the vote
Fairholme Capital Management, L.L.C.: 5,897,600
Bruce R. Berkowitz: 5,897,600
Fairholme Funds, Inc.: 5,590,800
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(iii) Sole power to dispose or to direct the
disposition of
Fairholme Capital Management, L.L.C.: 0
Bruce R. Berkowitz: 0
Fairholme Funds, Inc.: 0
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(iv) Shared power to dispose or to direct the
disposition of
Fairholme Capital Management, L.L.C.: 6,613,036
Bruce R. Berkowitz: 6,613,036
Fairholme Funds, Inc.: 5,590,800
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Item 5. Ownership of Five Percent or Less of a Class.
If this statement is being filed to report the fact that as of the date
hereof the reporting person has ceased to be the beneficial owner of more than
five percent of the class of securities check the following [ ].
N/A
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Item 6. Ownership of More Than Five Percent on Behalf of Another Person.
If any other person is known to have the right to receive or the power to
direct the receipt of dividends from, or the proceeds from the sale of, such
securities, a statement to that effect should be included in response to this
item and, if such interest relates to more than five percent of the class, such
person should be identified. A listing of the shareholders of an investment
company registered under the Investment Company Act of 1940 or the beneficiaries
of employee benefit plan, pension fund or endowment fund is not required.
N/A
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Item 7. Identification and Classification of the Subsidiary Which Acquired the
Security Being Reported on by the Parent Holding Company or Control
Person.
If a parent holding company or Control person has filed this schedule,
pursuant to Rule 13d-1(b)(1)(ii)(G), so indicate under Item 3(g) and attach an
exhibit stating the identity and the Item 3 classification of the relevant
subsidiary. If a parent holding company or control person has filed this
schedule pursuant to Rule 13d-1(c) or Rule 13d-1(d), attach an exhibit stating
the identification of the relevant subsidiary.
N/A
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Item 8. Identification and Classification of Members of the Group.
If a group has filed this schedule pursuant to s.240.13d-1(b)(1)(ii)(J), so
indicate under Item 3(j) and attach an exhibit stating the identity and Item 3
classification of each member of the group. If a group has filed this schedule
pursuant to s.240.13d-1(c) or s.240.13d-1(d), attach an exhibit stating the
identity of each member of the group.
N/A
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Item 9. Notice of Dissolution of Group.
Notice of dissolution of a group may be furnished as an exhibit stating the
date of the dissolution and that all further filings with respect to
transactions in the security reported on will be filed, if required, by members
of the group, in their individual capacity. See Item 5.
N/A
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Item 10. Certifications.
By signing below I certify that, to the best of my knowledge and belief,
the securities referred to above were acquired and are held in the ordinary
course of business and were not acquired and are not held for the purpose of or
with the effect of changing or influencing the control of the issuer of the
securities and were not acquired and are not held in connection with or as a
participant in any transaction having that purpose or effect.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
February 13, 2008
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(Date)
/s/ Fairholme Capital Management, L.L.C.
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(Signature)
By: /s/ Bruce R. Berkowitz
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(Signature)
Bruce R. Berkowitz /Managing Member
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(Name/Title)
/s/ Bruce R. Berkowitz
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(Signature)
Bruce R. Berkowitz
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(Name/Title)
/s/ Fairholme Funds, Inc.
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(Signature)
By: /s/ Bruce R. Berkowitz
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(Signature)
Bruce R. Berkowitz/Managing Member
of its Adviser
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(Name/Title)
* The Reporting Persons disclaim beneficial ownership in the Common Stock except
to the extent of his or its pecuniary interest therein.
The original statement shall be signed by each person on whose behalf the
statement is filed or his authorized representative. If the statement is signed
on behalf of a person by his authorized representative other than an executive
officer or general partner of the filing person, evidence of the
representative's authority to sign on behalf of such person shall be filed with
this statement, provided, however, that a power of attorney, for this purpose
which is already on file with the Commission may be incorporated by reference.
The name and any title of each person who signs the statement shall be typed or
printed beneath his signature.
Note. Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7 for other parties
for whom copies are to be sent.
Attention. Intentional misstatements or omissions of fact constitute federal
criminal violations (see 18 U.S.C. 1001).
Exhibit A
AGREEMENT
The undersigned agree that this Schedule 13G dated February 13, 2008 relating
to the Common Stock of USG Corporation, shall be filed on behalf of the
undersigned.
/s/ Fairholme Capital Management, L.L.C.
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(Signature)
By: /s/ Bruce R. Berkowitz
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(Signature)
Bruce R. Berkowitz /Managing Member
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(Name/Title)
/s/ Bruce R. Berkowitz
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(Signature)
Bruce R. Berkowitz
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(Name/Title)
/s/ Fairholme Funds, Inc.
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(Signature)
By: /s/ Bruce R. Berkowitz
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(Signature)
Bruce R. Berkowitz/Managing Member
of its Adviser
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(Name/Title)
SK 22146 0001 848617