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This is what is in store for tomorrow.
Case 1:13-cv-00465-MMS Document 132 Filed 02/23/15 Page 1 of 3
IN THE UNITED STATES COURT OF FEDERAL CLAIMS
FAIRHOLME FUNDS, INC., et al., ) ) Plaintiffs, ) ) v. )
THE UNITED STATES, ) ) Defendant. ) )
JOINT STATUS REPORT REGARDING FEBRUARY 25 STATUS CONFERENCE
In accordance with this Court’s Order of August 13, 2014 (Doc. 85), the parties hereby notify the Court that they believe that the Court should hold the status conference currently scheduled for February 25.
Pursuant to the Court’s August 13 Order, the parties further provide the following “sum- mary description of the topic areas” that they may wish to discuss at the status conference: (1) the general status of the discovery previously authorized by the Court; (2) issues related to De- fendant’s privilege logs (including Defendant’s characterization of the logs as “provisional” in nature) and Plaintiffs’ challenges to Defendant’s assertions of privilege; (3) issues related to Plaintiffs’ discovery requests to third-parties; and (4) the schedule for the completion of the dis- covery authorized by the Court.1
The parties hereby notify the Court that the following attorneys for the Fairholme Plain- tiffs plan to appear in person at the February 25 status conference:
1 With respect to this issue, the parties have engaged in discussions regarding a revised discovery schedule, and hope to finalize an agreement on this issue, and to submit a joint pro- posal for the Court’s consideration, in advance of the February 25 status conference. In any event, the parties will be prepared to discuss the discovery schedule at the status conference.
No. 13-465C
(Judge Sweeney)
Case 1:13-cv-00465-MMS Document 132 Filed 02/23/15 Page 2 of 3
Charles J. Cooper, Cooper & Kirk, PLLC
David H. Thompson, Cooper & Kirk, PLLC
Vincent J. Colatriano, Cooper & Kirk, PLLC
The following attorneys for the Fairholme Plaintiffs plan to appear by telephone:
Brian Barnes, Cooper & Kirk, PLLC
Christine Cubias, General Counsel, Fairholme Funds, Inc.
The following attorneys for the United States plan to appear in person:
Kenneth M. Dintzer
Elizabeth M. Hosford
Gregg M. Schwind
The following other attorneys plan to appear by telephone:
Zac Hudson, Bancroft PLLC (representing Fannie Mae)
Michael Ciatti, King & Spalding (representing Freddie Mac)
In accordance with the Court’s prior orders, counsel for the Fairholme Plaintiffs has con- tacted counsel for the plaintiffs in the related cases pending before this Court. The following at- torneys intend to listen to the status conference telephonically:
Kiran Patel, Dentons (Arrowood Indemnity Corp. v. United States, No. 13-698)
Matthew Goldstein, Kessler Topaz Meltzer & Check, LLP (Cacciapelle v. United
States, No. 13-466)
Eric Zagar, Kessler Topaz Meltzer & Check, LLP (Cacciapelle v. United States,
No. 13-466)
Noah Schubert, Schubert Jonckheer & Kolbe (Fisher v. United States, No.
13-608, Reid v. United States, No. 14-152)
2
Case 1:13-cv-00465-MMS Document 132 Filed 02/23/15 Page 3 of 3
Miranda Kolbe, Schubert Jonckheer & Kolbe (Fisher v. United States, No. 13- 608, Reid v. United States, No. 14-152)
Robert M. Roseman, Spector Roseman Kodroff & Willis (Washington Federal v. United States, No. 13-385)
Jennifer Fountain Connolly, Hagens Berman (Washington Federal v. United States, No. 13-385)
Louis C. Ludwig, Pomerantz LLP (American European Insurance Co. v. United States, No. 13-496)
Date: February 23, 2015
JOYCE R. BRANDA
Acting Assistant Attorney General
s/ Robert E. Kirschman, Jr. ROBERT E. KIRSCHMAN, JR. Director
s/ Kenneth M. Dintzer
KENNETH M. DINTZER
Deputy Director
Commercial Litigation Branch U.S. Department of Justice
P.O. Box 480 Ben Franklin Station Washington, D.C. 20044
(202) 616-0385
(202) 307-0972 fax KDintzer@CIV.USDOJ.GOV
Attorneys for Defendant
Respectfully submitted,
s/ Charles J. Cooper
Charles J. Cooper
Counsel of Record for Plaintiffs COOPER & KIRK, PLLC
1523 New Hampshire Avenue, N.W. Washington, D.C. 20036
(202) 220-9600
(202) 220-9601 (fax) ccooper@cooperkirk.com
Of counsel:
Vincent J. Colatriano
David H. Thompson
Peter A. Patterson
Brian W. Barnes
COOPER & KIRK, PLLC
1523 New Hampshire Avenue, N.W. Washington, D.C. 20036
(202) 220-9600
(202) 220-9601 (fax)
Correct, she said that on Jan28th.
1 With respect to this issue, the parties have engaged in discussions regarding a revised discovery schedule, and hope to finalize an agreement on this issue, and to submit a joint pro- posal for the Court’s consideration, in advance of the February 25 status conference. In any event, the parties will be prepared to discuss the discovery schedule at the status conference.
Sweeney said on the 28th, it can't be longer than 4 months.
Last Wed with just the release of Fed minutes, volume came almost to a screeching halt right around noon time (time of release).
DT, Finerman said a bit ago she's not in it now when we asked her, but hopefully she'll look at it again!
when it starts click here
http://www.banking.senate.gov/public/index.cfm?FuseAction=Home.Home
Yellen appears before the Senate Banking, Housing, and Urban Affairs Committee at 10 a.m. ET. With economic data recently showing better conditions in the labor market, investors will monitor her comments for a sense of when the Fed will start raising interest rates. In particular they'll be looking for indications that a hike is coming in June or September.
Attention will focus on how soon policy-makers plan to raise interest rates now that employment and wages are improving. In particular, discussion will focus on whether the next Fed statement on March 19 will drop a phase about being "patient."
Other events on the calendar include the Case-Shiller index of home prices at 9 a.m. and consumer confidence at 10 a.m.
http://www.optionmonster.com/news/article.php?page=pmc/stocks_in_holding_pattern_preyellen_101513.html&src=pmb
If this helps Roockie, defendants withdrew their opposition of these six, after Sweeney said she wouldn't grant the stay.
02/02/2015 NOTICE, filed by USA With Respect to Applications of Robert Corso, Mark McMahon, Maria Nizza, Nikhil Rupani, Christo Tzankov, and John Campbell for Access to Protected Information (Schwind, Gregg)
Fannie Mae and Freddie Mac are better than ever
Despite negative earning reports
Brena Swanson
February 23, 2015
Email
On the surface, it may look like Fannie Mae andFreddie Mac are in financial trouble again. But in reality, both government-sponsored enterprises have emerged from the financial crisis churning out more profits before taxes than they ever have before. Per The Economist:
Last week, Fannie Mae reported annual net income of $14.2 billion and annual comprehensive income of $14.7 billion in 2014. This compares to net income of $84.0 billion and comprehensive income of $84.8 billion in 2013, which included the release of the company’s valuation allowance against its deferred tax assets.
On the other side, Freddie Mac posted net income of $7.7 billion for the full-year 2014, compared to $48.7 billion for the full-year 2013. Freddie’s 2014 net income and comprehensive income declined from 2013 by $41 billion and $42.2 billion, respectively. 2013 results included an income tax benefit of $23.3 billion that primarily resulted from the release of the deferred tax asset valuation allowance in the third quarter of 2013.
“Falling market interest rates forced the pair to declare losses from their derivatives on their accounts, although the impact of this will even out in the long term,” the article stated.
Since Barack Obama’s administration in effect expropriated shareholders stakes in 2012: virtually all earnings now go to the Treasury.
Two challenges to this arrangement are before federal courts. Critics contend that the government is sowing the seeds of another crisis by encouraging both firms to loosen their lending standards for political reasons. But in the meantime the American government can look forward to some healthy dividends from the pair.
http://www.housingwire.com/articles/33034-fannie-mae-and-freddie-mac-are-better-than-ever?utm_source=dlvr.it&utm_medium=twitter&utm_campaign=housingwire
You're right. I checked Perry Capital appeal, no new news there. Last docket was Jan 16, just exchange of info.
"The parties hereby notify the Court that the following attorneys for the Fairholme Plain- tiffs plan to appear in person at the February 25 status conference:
1 With respect to this issue, the parties have engaged in discussions regarding a revised discovery schedule, and hope to finalize an agreement on this issue, and to submit a joint pro- posal for the Court’s consideration, in advance of the February 25 status conference. In any event, the parties will be prepared to discuss the discovery schedule at the status conference.
(Judge Sweeney)
Case 1:13-cv-00465-MMS Document 132 Filed 02/23/15 Page 2 of 3
Charles J. Cooper, Cooper & Kirk, PLLC
David H. Thompson, Cooper & Kirk, PLLC
Vincent J. Colatriano, Cooper & Kirk, PLLC
The following attorneys for the Fairholme Plaintiffs plan to appear by telephone:
Brian Barnes, Cooper & Kirk, PLLC
Christine Cubias, General Counsel, Fairholme Funds, Inc.
The following attorneys for the United States plan to appear in person:
Kenneth M. Dintzer
Elizabeth M. Hosford
Gregg M. Schwind
The following other attorneys plan to appear by telephone:
Zac Hudson, Bancroft PLLC (representing Fannie Mae) Michael Ciatti, King & Spalding (representing Freddie Mac)
JOINT STATUS REPORT REGARDING FEBRUARY 25 STATUS CONFERENCE
In accordance with this Court’s Order of August 13, 2014 (Doc. 85), the parties hereby notify the Court that they believe that the Court should hold the status conference currently scheduled for February 25.
Pursuant to the Court’s August 13 Order, the parties further provide the following “sum- mary description of the topic areas” that they may wish to discuss at the status conference: (1) the general status of the discovery previously authorized by the Court; (2) issues related to De- fendant’s privilege logs (including Defendant’s characterization of the logs as “provisional” in nature) and Plaintiffs’ challenges to Defendant’s assertions of privilege; (3) issues related to Plaintiffs’ discovery requests to third-parties; and (4) the schedule for the completion of the dis- covery authorized by the Court.1
The parties hereby notify the Court that the following attorneys for the Fairholme Plain- tiffs plan to appear in person at the February 25 status conference:
1 With respect to this issue, the parties have engaged in discussions regarding a revised discovery schedule, and hope to finalize an agreement on this issue, and to submit a joint pro- posal for the Court’s consideration, in advance of the February 25 status conference. In any event, the parties will be prepared to discuss the discovery schedule at the status conference.
132
02/23/2015 JOINT STATUS REPORT Regarding February 25 Status Conference, filed by All Plaintiffs. (Cooper, Charles)
March in front of the Treasury.
The Community Mortgage Lenders of America renewed its call for U.S. Treasury Secretary Jack Lew and Federal Housing Finance Agency Director Mel Watt to take immediate action to recapitalize/cure the under-capitalization of both Fannie Mae and Freddie Mac.
The CMLA in December of last year – as the GSEs were reporting record profits – called for immediate action that would allow them to retain some of those profits to build a reasonable risk capital base.
Now, as profits plummet for both Fannie Mae and Freddie Mac – due in large part, to losses on derivatives – that call gains prophetic urgency.
The GSE capital levels, already minimal, will hit zero within just the next few years. Low or zero capital, coupled with declining earnings, could require yet another federal bailout. Fannie’s CEO Tim Mayopoulos, for example, said the “fact that we don’t have a significant amount of capital increases the likelihood” that Fannie will need additional capital from Treasury at some point.
The GSE capital depletion is a direct outcome of the repayment terms embedded in the Preferred Stock Purchase Agreements between the GSEs and the U.S. Treasury. That agreement requires the GSEs to remit 100% of profits, which precludes building capital.
CMLA Chair Paulina McGrath said “this precarious balance in earnings, derivative and market risks versus capital is an irrational approach to preserving the housing market. The Treasury agreement generates cash flow into the Federal coffers but this could prove to be at the expense of lenders and homebuyers alike.”
After Freddie Mac makes its next dividend payment, the GSE will have returned $91.8 billion to Treasury versus draws of $72.3 billion, resulting in an account surplus of $19.5 billion.
Both GSEs have recorded 12 consecutive profitable quarters while, at the same time, each is approaching zero capital levels. That leaves the GSEs – and in turn, the taxpayers – at risk from market or overall economic declines as well as continued losses from GSE derivatives.
The CMLA is repeating its call for Treasury to take immediate corrective action to cure the undercapitalization of the GSEs.
“There is neither a need nor a rational reason to wait on Congress to act, particularly since GSE reform legislation is far from certain,” McGrath said.
http://www.housingwire.com/articles/33020-cmla-calls-on-fhfa-treasury-to-recapitalize-fannie-and-freddie?utm_source=dlvr.it&utm_medium=twitter&utm_campaign=housingwire
Just respond, we all bounce off all each day ther and ruse for another day!!!
Nevermind!!! What post are you referring fo?
No rulings yet, and there better not be on unverified (??) posts! That's all!!!!
No...you said there was a ruling about the 80%, what was that?
ok jackricker, follow up with that, it really is best for everyone to be informed! IMO
You said there was a ruling. Where is the ruling? Just wondering?
I'm glad I've done my practice toasts! I wish I could remember the names of the blackjack dealers, Oh well!! I'll go tip them again!! :)
where's this ruling jld3294?!
and what is exactly is the government's right(as you say) to take 80% ownership of a privately held company? Where is that "right?"
What does the 5th ammendment taking Clause say?
Can you elaborate? you think Fed may own which part?
Are you long or short term, Fnma, Fmcc?
Top hedge fund manager 2014, thinks Fannie, Freddie is most interesting trade in the capital markets.
pop-n-lock is coming. I'm really nice, but they've had they're chances!! Time for some toasts!!
looks familiar!!! OK, let's go!! We all need an update on the Perry Capital Appeal, first one to post wins a prize!
It seems good that the gap is at least hard to fill!! Who wants to sell there?!!' Pps should rise by the end of the week. I don't know if it will be steady, or a few vomit bags (as someone here said) along the way. Maybe there will be a status update Wednesday! We'll probably find out tomorrow if there is any request for a conference Wednesday.
For anyone again interested in the AIG, Fnma connection...
Fannie, Freddie shareholders demand lost dividends from U.S. in new class action
By Alison Frankel July 10, 2013
In August of 2012, the U.S. Treasury and the Federal Housing Finance Agency announced that they had amended the terms of Treasury’s investment in Fannie Mae and Freddie Mac, the government-sponsored mortgage lenders under FHFA’s conservatorship. After Fannie and Freddie went into conservatorship in the economic crisis of 2008, Treasury invested more than $100 billion in a new class of senior preferred stock that guaranteed the government first dibs on a percentage of Fannie or Freddie profits. Those seemed like a distant hope in 2008, but by 2012, Fannie and Freddie were, in fact, making money. Preferred shareholders junior to the government believed the mortgage lenders were generating enough profits to pay Treasury’s dividend and leave something for them as well. But in August, FHFA and the government – without consulting Fannie and Freddie junior preferred shareholders – disclosed that under a newly executed “net worth sweep,” Treasury would be receiving all of the profits kicked out by Fannie Mae and Freddie Mac, then and in the future.
On Wednesday, junior preferred shareholders filed a class action in the U.S. Court of Federal Claims, asserting that the August 2012 agreement between FHFA and the Treasury amounted to an illegal seizure of their property in violation of the Takings Clause of the Fifth Amendment of the U.S. Constitution. The preferred shareholders, represented by Boies, Schiller & Flexner and Kessler Topaz Meltzer & Check, point to the $66.3 billion dividend Fannie and Freddie paid to the government in the second quarter of 2013, arguing that more than $60 billion of that money was misappropriated from them.
The new shareholder class action follows an injunction suit filed Sunday in federal court in Washington by Perry Capital and its lawyers at Gibson, Dunn & Crutcher. The Perry suit, which claims that the August 2012 agreement between Treasury and FHFA “enriches the federal government through a self-dealing pact, and destroys tens of billions (of dollars) of value in the companies’ preferred stock,” seeks a declaratory judgment that the amended agreement violates the Administrative Procedures Act, as well as an injunction against implementing the new agreement. In addition, the mutual fund Fairholme Funds and several insurance companies that own Fannie Mae and Freddie Mac junior preferred shares filed a Takings Clause case on Tuesday night in the Court of Federal Claims. Cooper & Kirk, which represents the Fairholme plaintiffs, raises allegations that parallel those in the new class action but brought the case only on behalf of the named shareholders.
There’s also a month-old class action for holders of Fannie Mac and Freddie Mac common shares under way in the Court of Federal Claims. As I’ve reported, that case asserts that the government’s 2008 takeover of the mortgage lenders and the FHFA’s subsequent operation of Fannie Mae and Freddie Mac was an illegal taking under the Fifth Amendment. The new class action, which only involves preferred shareholders and focuses on the 2012 amendment rather than the 2008 takeover, does not overlap with the previously filed case.
It’s notable that the new class action was filed by Boies Schiller, which innovated the technique of suing for lost shareholder value under the Takings Clause in litigation for former AIG chief Hank Greenberg, who claims that the government’s 2008 bailout of AIG wrongfully deprived shareholders of tens of billions of dollars in equity. Though the new Fannie Mae and Freddie Mac case involves alleged government overreaching four years after the economic crisis, said Boies partner Hamish Hume, it raises similar allegations that Treasury violated the Fifth Amendment and ran roughshod over shareholders.
Boies’s co-counsel in the case, Kessler Topaz, has been exploring the possibility of a Takings Clause case for several months, said partner Lee Rudy. The firm, which can normally be found in securities class actions and shareholder derivative suits, got in touch with Cooper & Kirk, a boutique that has Takings Clause expertise. Cooper was researching the suit it filed Tuesday for Fairholme, but said it was not prepared to bring a class action, Rudy said. It referred him to Hume at Boies Schiller. The new class action was filed on behalf of two individual preferred shareholders but Rudy and Hume said that they’re hoping other preferred shareholders in Fannie Mae and Freddie Mac join the case as name plaintiffs.
The Fannie Mae and Freddie Mac Takings Clause litigation presents an odd sort of reunion for Boies Schiller and Cooper & Kirk, which were on opposite sides of the California marriage equality case that was decided by the U.S. Supreme Court last month. Now they’re on the same side of a Constitutional issue – and so is Boies Schiller’s gay marriage co-counsel, Gibson Dunn. (Hume said that he hasn’t yet been in touch with Gibson Dunn about its Perry complaint but expects he soon will be.) If the Fannie Mae and Freddie Mac preferred shareholder cases ever get to the Supreme Court, there will certainly be no shortage of talent to argue against the government.
FHFA put out a statement about the new suits: “”We are reviewing each lawsuit carefully, but it is important to remember that Fannie Mae and Freddie Mac remain in conservatorship and their financial future remain uncertain except for support from the American taxpayer.”
Berkowitz and Ackman just said in their letter to shareholders that they are in this stock for the long run. Ackman had the top-performing hedge fund in 2014. He's been watching Fannie, Freddie for quite a while, well before he dove in for $250 million, the November before last. I'm personally not that patient, but am having fun following them! Discovery will continue!!!!
I was noticing in his recents statements he seemed to be saying, that although fellow shareholders will benefit, they won't always know exactly what is going on. More like, they're not going to sound the bullhorn, every time they make a move toward progress.
The hedgies conference had a big impact last year. It should this year as well!!
Actually, it was Feb 12, my mistake, lots of interesting info from different sources.
http://mobile.reuters.com/article/idUSnBw036165a+100+BSW20150203?irpc=932
Sorry for budding in, conference was Feb 13th.
Bill seemed pretty confident when he made his comments on the 13th. His Allergan deal closes in April, more $$$$ to spread around.
Sounds good! Thank you ospreyeye.
Agreed, the increased awareness will only help, looks as if we're going up this week!