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http://www.housingwire.com/blogs/1-rewired/post/32708-monday-morning-cup-of-coffee-ocwen-settles-frustrating-skirmish-with-california?utm_source=dlvr.it&utm_medium=twitter&utm_campaign=housingwire
The European Central Bank dove headfirst into the empty pool that is quantitative easing last week, and while an honest assessment of how bad it will be for Europe is as likely as getting an honest assessment from the Federal Reserve of how bad QE was for the U.S. economy, it could be good for American homeowners.
“We view the ECB's big QE announcement as positive for US households,” said Chris Flanagan, MBS/ABS Strategist for Bank of America/Merrill Lynch. “We already thought the probability was high that a new low in mortgage rates would be seen in 2015, and we think the ECB move simply increases that probability. In our view, this is an unequivocal positive for the US household sector. We also see QE as generally supportive of asset prices and think U.S. real estate prices, for both residential and commercial, have upside potential from more QE, even if the QE comes from overseas.”
Flanagan says securitized products benefit on numerous levels from the ECB move, and he continues to recommend adding exposure down-in-credit within the various sub-sectors.
“We see spread tightening potential. In agency MBS, we maintain an underweight view as we think the market continues to underestimate the risk of a sizable refinancing wave in 2015. We like adding sustainable duration within the market, in CMOs, as we think it will become increasingly valuable in the months ahead,” Flanagan says. “Down-in-coupon in pass-throughs is preferred over the belly of the coupon stack in particular, but increased supply resulting from lower mortgage rates should result in underperformance versus comparable duration treasuries.”
You think Greenberg will lose?
Maybe we'll know more after the AIG verdict.
So, you don't think there are any back room deals, assigning warrants, etc.?
Your last paragraph with Demarco? uugghh, why is this taking so long!! Sorry just venting. Perusing your info, will get back to you. Which part do you think is most relevant to proof that warrants aren't being messed with?
Exhibit G excluded?
Ok, then disprove, just joking.
If it's still there. Can anyone provide proof that there are no "backroom deals?"
Nah, wasn't that unless it ended up there too. :) This was the article.
http://thefederalist.com/2014/09/09/housing-market-not-too-big-to-fail-but-too-regulated-to-succeed/
Whatever happened to the rumors of "backroom deals" with the warrants? That author mentioned it last fall like he had some inside info, and then there was no follow up?
@CGasparino: next big financial story: decision on Hank Greenberg suit vs US govt on legality of AIG bailout whatever u think of hank consider...
Do you see any hurdles with Basel requirements? The parts that went into effect this month? Also, thank you so much for your time and for talking with them directly! Much appreciated.
MB, what about what Pimco said last year about taking out all government backstop?
PIMCO Sees Flaw in Obama Fannie Freddie Wind-down Plan
By Dan Freed - 04/15/14 - 12:58 PM EDT
NEW YORK (TheStreet) --PIMCO, one of the world's largest asset managers, has joined a growing chorus of critics of legislation proposed by Sens. Tim Johnson (D, SD) and Mike Crapo (R., ID) which is widely seen as President Obama's favorite plan to reform the U.S. housing market by winding down Fannie Mae and Freddie Mac .
In an essay published over the weekend in Barron's, newly-appointed PIMCO CEO Douglas Hodge pointed to what he described as a "significant oversight" in the legislation: the lack of protections for investors such as PIMCO who play a critical role in financing the mortgage market, even though it is largely invisible to most homebuyers.
These investors buy mortgage backed securities (MBS) - bonds backed by pools of mortgage obligations. While a little more than half of all MBS were backed by Fannie and Freddie in the pre-crisis environment of 2005, today 99% are backed by these government sponsored entities (GSEs), according to Hodge. Since President Obama wants to wind down Fannie and Freddie, this is a problem.
Read: Mortgage Rates Remain a Gift for Homebuyers
According to Hodge PIMCO has no "appetite" for MBS that don't have GSE guarantees, because the protections offered to investors in non-GSE backed MBS, known as "private label" securities, proved to have no teeth.
If PIMCO and other investors won't buy private label MBS and the Johnson Crapo bill winds down Fannie and Freddie, the vast majority of the mortgage market would go away, making it far more difficult for most Americans to buy homes.
With his Barron's essay, PIMCO's Hodge becomes the latest critic of the Johnson Crapo bill, which has drawn opposition for a variety of reasons from both the political right and left. Consumer advocate Ralph Nader argues Fannie and Freddie should be kept alive and heavily regulated much like public utilities. Nader also takes issue with the fact that the legislation does not recognize the claim of existing private shareholders in Fannie and Freddie, a complaint echoed by Tea Party-affiliated groups with names like the Center for Individual Freedom and the 60 Plus Association.
Read: Here's the Truth Behind the Recent Market Rally
What is puzzling about Hodge's complaint is that PIMCO was among several large financial institutions that agreed in 2011 to accept 8 cents on the dollar from Bank of America in one of the largest legal disputes over MBS. Other investors, most notably AIG , have held out for larger settlements, and the case has been tied up in the courts ever since.
E-mail messages to spokespeople for Senators Crapo and Johnson, as well as to a PIMCO spokesman, weren't immediately returned on Tuesday.
Follow @dan_freed
OK, thanks. I see what you're saying. Glad you're not another basher. :) The cases against the gov are tough. At least Sweeney said they'll have their day in court, and she wants them to state when and how the Conservatorship will end. Looking forward to hearing any updates.
Ok, to set the Ackman part straight. Ackman filed two lawsuits days apart in August. Lamberth ruled against Perry capital Sept 30th and said some cases would be consolidated with that. Ackman had his case in Lamberth court, voluntarily dismissed Nov 3rd.
I don't see "new lawsuits" thrown out? Yes, the Lamberth decision in September was terrible. Perry is in the appeal process. Fairholme has been in Sweeney's court for quite a while.
The other part where you're saying the hedge funds knew they didn't have a chance with the lawsuits? You've got Cooper, Olson, Boies bringing forth lawsuits that they don't think have a chance? What?
@SecretaryCastro: Hey @TheDailyShow fans, I'll be stopping by the show tomorrow night so be sure to tune in at 11 pm ET ? http://t.co/B0eCm2xvdm
Who refiled? Are you talking about Perry Capital appeal?
?What new lawsuits do you think will be thrown out?
long term, seems too hard to trade in the tight channel it's been in anyway
If you want to know what long term investors Bruce Berkowitz and Bill Ackman are thinking you can tune into Berkowitz conference Feb 3rd and read Ackman, Pershing squares last letter to shareholders. Here's Bruce's info copied from Travel5 post.
Berkowitz to Take Investor Questions After Fannie-Freddie Losses
By Zachary Tracer
January 22, 2015 3:44 PM EST
Bruce Berkowitz has scheduled a conference call to address investors’ questions after his Fairholme Capital Management posted losses on holdings including Fannie Mae and Freddie Mac.
The money manager will hold the hour-long call on Feb. 3, Miami-based Fairholme said Thursday in a statement. Questions can be submitted by e-mail.
Fairholme Fund (FAIRX) investors lost 2.7 percent last year, including dividends, while the Standard & Poor’s 500 Index posted a total return of 13.7 percent. Berkowitz typically picks securities that he believes are undervalued by other investors. American International Group Inc. and Bank of America Corp. are among the fund’s top holdings, along with bets on Fannie Mae and Freddie Mac.
“We invest when we have compelling and quantifiable reasons that support a valuation that is far higher than the market currently suspects,” Berkowitz said in the statement.
Berkowitz, who was named U.S. domestic stock-fund manager of the decade in 2010 by Morningstar Inc., has turned to such events in the past in an effort to reassure investors. In 2011, he arranged for Bank of America Chief Executive Officer Brian T. Moynihan to take questions on a public call after the lenders’ shares plunged. In March 2009, he peppered then-Pfizer Inc. CEO Jeffrey Kindler with questions about the prospects for the firm, Berkowitz’s biggest holding at the time.
The public may submit questions to Ask@fairholme.net and the company said it will make details available on its website about a live stream of the call. Fred Fraenkel, Fairholme’s president and chief research officer, will also participate.
If you haven't done these things yet, for a long term view
Then go to pershingsquareholdings.com letter to shareholders for some of Ackmans insights. Take a look at Ackman's presentations on Fannie, Freddie too. I'm sure someone can give a link here.
SHELBY ANNOUNCES BANKING SUBCOMMITTEES FOR 114TH CONGRESS
January 23, 2015
WASHINGTON, DC – Thursday, January 22, 2015 – U.S. Senator Richard Shelby (R-Ala.), Chairman of the United States Senate Committee on Banking, Housing, and Urban Affairs, today announced subcommittee chairmen and subcommittee membership for the 114th Congress.
“Subcommittees play an important role in ensuring that the Banking Committee is productive,” said Chairman Shelby. “I am confident in the leadership of our subcommittees and look forward to working them in the 114th Congress.”
Subcommittee on Securities, Insurance, and Investment
Senator Mike Crapo (R-ID) – Chairman
Senator Bob Corker (R-TN)
Senator David Vitter (R-LA)
Senator Patrick J. Toomey (R-PA)
Senator Mark Kirk (R-IL)
Senator Tim Scott (R-SC)
Senator Ben Sasse (R-NE)
Senator Jerry Moran (R-KS)
Subcommittee on Financial Institutions and Consumer Protection
Senator Patrick J. Toomey (R-PA) – Chairman
Senator Mike Crapo (R-ID)
Senator Dean Heller (R-NV)
Senator Mike Rounds (R-SD)
Senator Bob Corker (R-TN)
Senator David Vitter (R-LA)
Senator Mark Kirk (R-IL)
Senator Tim Scott (R-SC)
Subcommittee on Housing, Transportation, and Community Development
Senator Tim Scott (R-SC) – Chairman
Senator Mike Crapo (R-ID)
Senator Dean Heller (R-NV)
Senator Jerry Moran (R-KS)
Senator Bob Corker (R-TN)
Senator Tom Cotton (R-AR)
Senator Mike Rounds (R-SD)
Senator David Vitter (R-LA)
Subcommittee on Economic Policy
Senator Dean Heller (R-NV) – Chairman
Senator Patrick J. Toomey (R-PA)
Senator Tom Cotton (R-AR)
Senator Mike Rounds (R-SD)
Senator Ben Sasse (R-NE)
Senator Jerry Moran (R-KS)
Subcommittee on National Security and International Trade and Finance
Senator Mark Kirk (R-IL) – Chairman
Senator Tom Cotton (R-AR)
Senator Ben Sasse (R-NE)
Chairman Shelby will serve on all subcommittees as an ex-officio, non-voting member.
January 2015 Majority Press Releases
Browse by:
Current record
If you happen to bump into Kyle Bass there in Dallas, let him know it might be time to get back into Fannie, Freddie! :)
Doing great, why does Treasury get to keep profits?
Yesterday Lew, "So we've said we think that lenders have put a tighter box on mortgage credit than was intended. So, we're trying to work our way through that, through some changes in guidance and rules to make sure that there's not that over-shooting, so that people have access to the credit that they can afford."
So without Fannie, Freddie, how could they make changes to guidance and rules?
We'll make sure everyone has a link Tuesday. Hey, what's the congress doing Monday? It's not a holiday. :)
Sorry that last post is for Tues 27th. Senate organizational meeting, House hearing with Watt.
OK :)
Also,
10:00 AM
Banking, Housing, and Urban Affairs
Organizational business meeting to consider an original resolution authorizing expenditures by the Committee, subcommittee assignments, and rules of procedure for the 114th Congress; to be immediately followed by a hearing to examine perspectives on the strategic necessity of Iran sanctions.
That's good too, send it!! :)
Great letter Dallas! Thank you for your service. We wouldn't even have this blog if there were not people out there defending our rights. Everyone on here just checking in, getting info should send at least an email to all US reps, U.S. sen's. If you don't know what to write use the ones posted or ask somebody. Like Dallas said, emails are pretty much free. Shareholders were left here for a reason (big picture)....Get your email in today, before Tuesday's hearing. If you're inclined to say, my email doesn't matter as to legislation, then just at least selfishly think of the buying power of congressmen and their staffers. Most of them are investors. Just the awareness can kick things up to the next level.
Could be an interesting week, something from Sweeney court, Watt Tuesday. Do you remember the latest on Perry appeal? I think Lew and Watt were requesting to file separate responses?
Latest Fairholme filing
121
01/23/2015 NOTICE of Additional Authority Supporting Rafter Amici (Rosenberg, Lawrence)
Case 1:13-cv-00465-MMS Document 121 Filed 01/23/15 Page 1 of 10
IN THE UNITED STATES COURT OF FEDERAL CLAIMS __________________________________________
) FAIRHOLME FUNDS, INC., et al., ) ) Plaintiffs, )
) No. 1:13-cv-465C v. )
) Judge Margaret M. Sweeney THE UNITED STATES, )
) Defendant. ) )
RAFTER AMICI’S NOTICE OF SUPPLEMENTAL AUTHORITY
The Rafter Amici (“Amici”) respectfully bring to the Court’s attention a recent
opinion by Judge Lamberth that disposes of arguments made by the Government in response to Amici’s brief.
In their brief urging the Court not to stay this case, Amici pointed out that the Government’s preclusion arguments against plaintiffs in this case based on the D.D.C.’s decision in Perry Capital v. Lew, 2014 WL 4829559 (D.D.C. Sept. 30, 2014), are inapplicable to Amici, who were not parties to the Perry Capital decision. Dkt. No. 107-1 at 2-5. Amici also noted that they had voluntarily dismissed without prejudice a complaint filed in the D.D.C. Id. at 3 n.1.
In its response, the Government noted that it had moved the D.D.C. to strike the voluntary dismissal and to declare that the Perry Capital decision had actually dismissed Amici’s claims with prejudice. Dkt. No. 115, Ex. A at 4 n.2 (“[T]he very premise underlying Rafter’s amicus brief—that it was not subject to the Perry Capital decision—is itself in serious doubt.”).
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Case 1:13-cv-00465-MMS Document 121 Filed 01/23/15 Page 2 of 10
On January 21, 2015, the D.D.C. denied the Government Defendants’ motion to strike in its entirety. Memo. & Order at 7, Rafter v. Dep’t of Treasury, No. 14- 1404 (D.D.C. Jan. 21, 2015) (Ex. A). Two aspects of that ruling are relevant here.
First, the D.D.C. held that Amici’s case in that court “remains dismissed” without prejudice. Id. at 7. The D.D.C.’s ruling reaffirms that Perry Capital does not have a preclusive effect on Amici’s claims here, and that the Government’s argument for a stay is inapplicable to Amici.
Second, the D.D.C. rebuffed Defendants’ contention that Amici’s voluntary dismissal was somehow improper. Id. at 6-7. This conclusion confirms that Amici’s voluntary dismissal has no bearing on the appropriateness of a stay here.
For the reasons set forth in Amici’s brief, further supported by the D.D.C.’s decision of January 21, the Court should deny the Government’s motion for a stay.
?January 23, 2015
Respectfully submitted,
/s/ Lawrence D. Rosenberg Lawrence D. Rosenberg
Counsel of Record
Of Counsel Thomas F. Cullen James E. Gauch Paul V. Lettow
JONES DAY
51 Louisiana Avenue, N.W. Washington, D.C. 20001 Telephone: 202-879-3939 Fax: 202-626-1700 ldrosenberg@jonesday.com
Counsel for Rafter Amici -2-
Case 1:13-cv-00465-MMS Document 121 Filed 01/23/15 Page 3 of 10
EXHIBIT A
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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
) LOUISE RAFTER, et al., )
Plaintiffs, )
v. ) ) DEPARTMENT OF THE TREASURY, et al., )
Defendants. )
MEMORANDUM & ORDER
Before the Court is the defendants’ motion to strike the plaintiffs’ notice of voluntary dismissal [17]. Upon consideration of the defendants’ motion [16], the plaintiffs’ opposition [18] thereto, the defendants’ reply [19], the applicable law, and the entire record herein, the Court will DENY the defendants’ motion to strike.
I. BACKGROUND
This matter hinges on whether the complaint filed by the plaintiffs in this case was automatically consolidated with the Consolidated Class Action, In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations, No. 13 Misc. 1288, that this Court dismissed pursuant to its Memorandum Opinion in Perry Capital LLC v. Lew, No. 13 Civ. 1025, 2014 WL 4829559 (D.D.C. Sept. 30, 2014). As the Court will explain, no such automatic consolidation occurred.
This Court, then District (now Circuit) Judge Wilkins presiding, issued an Order consolidating seven lawsuits, each of which was “styled as a class action and/or a derivative action,” into one Consolidated Class Action. Consolidation Order, In re Fannie Mae/Freddie
?Civil No. 14-1404 (RCL)
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Mac, No. 13 Misc. 1288 (D.D.C. Nov. 18, 2013), ECF No. 1. The Court noted that the Consolidation Order shall also apply to “each putative class action and/or derivative action that is subsequently filed in or transferred to this Court that relates to the same subject matter as in the Consolidated Class Action.” Id. ¶ 2. Yet, as described below, the Consolidation Order further delineated a series of steps to be followed for consolidation to take place. See id. ¶¶ 3, 6, 7.
The plaintiffs filed their complaint in this action against the Department of the Treasury and the Federal Housing Finance Authority (“FHFA”) on August 15, 2014. Compl., ECF No. 1. The complaint featured purportedly direct claims for breach of fiduciary duty against FHFA and Treasury, among other claims. See id. Counts V-VII. A day earlier, the same plaintiffs in this case had filed a complaint in the Court of Federal Claims alleging derivative and takings claims. Compl., Rafter v. United States, No. 14 Civ. 740 (Fed. Cl. Aug. 14, 2014). The Court of Claims action was assigned to Judge Sweeney, who had already been assigned a related takings case brought by Fairholme Funds.1 See Compl., Fairholme Funds, Inc., v. United States, No. 13 Civ. 465 (Fed. Cl. July 9, 2013).
On September 30, 2014, this Court dismissed the Consolidated Class Action, along with three other individual lawsuits, that had presented a number of claims closely related to the claims in Rafter. Perry Capital, 2014 WL 4829559. On October 10, 2014, the Clerk’s Office accidentally terminated the Rafter case, only to fix its error later that same day. In light of the Perry Capital Opinion, the defendants in Rafter sought an extension of time to file dispositive motions regarding the effect of Perry Capital on the present case. See Mot., ECF No. 11. The Court granted the defendants’ unopposed motion, setting November 3, 2014, as the due date for the defendants’ respective briefs. Order, ECF No. 12.
1 Fairholme Funds was one of the individual plaintiffs dismissed as part of the Court’s Perry Capital decision. 2
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On October 31, 2014—three days before the defendants’ dispositive motions were due— the plaintiffs filed a notice of voluntary dismissal, ECF No. 16, pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(i). The Clerk’s Office terminated the case on November 3, 2014. Three weeks later, Judge Sweeney of the Federal Court of Claims granted the Rafter plaintiffs’ leave to file an amicus brief in the Fairholme action. Fairholme, No. 13 Civ. 465 (Fed. Cl. Nov. 24, 2014), ECF No. 108. In Fairholme, the government defendants had recently filed a motion for stay pending appeal of the Perry Capital decision to the Court of Appeals for the District of Columbia Circuit, or, in the alternative, dismissal based on Perry Capital’s alleged preclusive effect. Id., ECF No. 103. The amicus brief noted that the Perry Capital decision cannot preclude the Rafter plaintiffs’ related case in front of Judge Sweeney due to their voluntary dismissal of the case in front of this Court. See Amicus Brief 2-3 & n.1, id., ECF No. 107-1.
Two weeks following the Rafter plaintiffs’ amicus brief in Fairholme arguing against preclusion, the defendants in the present case filed their motion to strike the notice of voluntary dismissal. Mot., ECF No. 17. The defendants further request that the Court “declare that [the] [p]laintiffs’ action was consolidated with the Consolidated Class Action pursuant to the Consolidation Order[] [and] [] declare that the Court’s Perry Capital Order dismissing the Consolidated Class/Derivative Action also dismissed this action . . . .” Id. at 12.
II. ANALYSIS
The Consolidation Order outlined the process necessary to consolidate a newly-filed or transferred “putative class action and/or derivative action that arises out of the subject matter of the Consolidated Class Action.” The Clerk of the Court “shall . . . mail a copy of th[e] [Consolidation] Order to the attorneys for the plaintiff(s) in the newly filed . . . case” and “make the appropriate entry in the docket for this action.” Consolidation Order ¶ 6(b), (c). The Court
3
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designed such a procedure to provide notice to the plaintiffs in the newly filed case that the Clerk’s Office will consolidate their class/derivative action with the existing Consolidated Class Action unless they object to consolidation within ten days of receipt of the Order, “and this Court deems it appropriate to grant such [objection].” See id. ¶ 7. Moreover, the Order “requests the assistance of counsel in calling to the attention of the Clerk of this Court the filing . . . of any case which might properly be consolidated . . . .” Id. ¶ 3 (emphasis added). The implication of paragraph three is that the Clerk’s Office—and the Court, for that matter—will not act sua sponte to declare that a newly filed lawsuit is consolidated with the Consolidated Class Action. An obvious means for the government defendants to call the attention of the Clerk’s Office or the Court to a possible consolidation scenario in Rafter would have been to file a motion for consolidation. If the defendants had filed such a motion here, the plaintiffs would have had an opportunity to argue that their claims were, in fact, direct rather than derivative.
But the defendants never filed such a motion, or “called to the attention of the Clerk[‘s Office]” in any manner that this case “might be properly consolidated.” See id. Consequently, the Clerk’s Office never filed a copy of the Consolidation Order on the Rafter docket or mailed a copy to the plaintiffs, and the plaintiffs never had an opportunity to object to any potential consolidation. Instead, the defendants clearly believed this case would proceed separately, filing an unopposed motion for extension of time to submit dispositive motions “that address[] the effect of the Perry Capital decision on this case.” Mot. 1-2, ECF No. 11. Nowhere in that motion—the defendants’ only filing in this matter prior to their motion to strike the plaintiffs’ notice of voluntary dismissal—did the defendants broach the issue of consolidation. Therefore, no consolidation occurred here.
4
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This defined process for consolidation is especially important for cases, such as the one at present, where it is necessary for the Court to determine whether claims styled as direct in the wording of a complaint are, in fact, derivative and, therefore, qualify for consolidation under the Consolidation Order. The defendants contend that the Court’s Perry Capital decision resolved that the Rafter plaintiffs’ claims are derivative. It is true that there are apparent similarities in the nature of the fiduciary duty claims brought by both the plaintiffs in the instant suit, see Compl. Counts V-VII, and the Fairholme plaintiffs as part of the Perry Capital case, see Compl. Count VII, Fairholme Funds, Inc. v. FHFA, No. 13 Civ. 1053 (D.D.C. July 10, 2013), ECF No. 1. Yet the portions of the Perry Capital Opinion that, according to the defendants, allegedly “settled any debate” as to the nature of the Rafter plaintiffs’ fiduciary duty claims are dicta that have no dispositive effect here. See Reply 2 (citing Perry Capital, 2014 WL 4829559, at *12 n.24, *16 n.39, *17, *19 n.45). Indeed, the Perry Capital Opinion explained that it was unnecessary for the Court to decide the question of whether the Fairholme plaintiffs’ claims were direct or derivative. Perry Capital, 2014 WL 4829559, at *12 n.24 (“[T]here is no requirement for the Court to decide whether such claims are derivative or direct.”). Rather, the Opinion only noted that if it had been necessary to decide such a question, the Court would have characterized the Fairholme plaintiffs’ fiduciary duty claims, in the context of that lawsuit, as derivative. Id.2 Here, the defendants never posed such a question to the Court. Consequently, the Court had no occasion to decide whether the plaintiffs’ purportedly direct fiduciary duty claims were actually derivative and, thus, should be consolidated.
2 Similarly, the defendants’ remaining citations are to segments of the Perry Capital Opinion discussing a hypothetical scenario under which the plaintiffs were able to claim present—rather than prospective—damages regarding liquidation preferences and, to a lesser extent, dividend rights. See id. at *16 n.39, *17, *19 n.45. As the Court made clear, the plaintiffs failed to plead present damages. E.g., id. at *16 n.39 (finding that the plaintiffs’ liquidation preference claims were not ripe). Moreover, such dicta was not part of the Court’s holding and in no way worked to automatically consolidate the Rafter plaintiffs’ case with the cases decided in Perry Capital.
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Finally, the Court feels obligated to respond to the government defendants’ apparent suggestion that the Rafter case was properly closed, presumably in accordance with the Consolidation Order, only to be reopened again at the ex parte insistence of the Rafter plaintiffs’ counsel. See Reply 3 & n.4. In truth, the Clerk’s Office inadvertently terminated the Rafter case on October 10, 2014—the same day it correctly terminated the multiple cases involved in the Court’s Perry Capital decision. This error was likely due to the fact that, following a notice submitted by the Rafter plaintiffs on August 15, 2014, ECF No. 3, Rafter was designated as “related” to the numerous plaintiffs whose claims the Court dismissed in Perry Capital. What is certain, however, is that, some hours later, the Clerk’s Office reopened the Rafter case because the Court, upon receiving a termination notice as to Rafter through the ECF email system, informed the Clerk’s Office of its blunder. Conspiracy theories aside, the defendants should rest assured that the Clerk’s Office was not acting at the unilateral behest of the Rafter plaintiffs’ counsel when it corrected its mistaken closure of the case. Since the defendants never raised the issue of consolidation, and the Court never filed any order on the docket, sua sponte, consolidating this case, it is inconceivable that the Clerk’s Office decided, on its own accord, to terminate this case because it believed that Rafter’s purportedly direct claims were, in fact, derivative.3
Frustrated by the fact that the plaintiffs’ voluntary dismissal occurred “one business day before Defendants’ planned filing of dispositive motions,” Mot. 6, and aware that the purpose of voluntary dismissal may have been to permit the plaintiffs to argue that preclusion does not apply to a separate action filed in another federal court, id. at 6-7; see also Amicus Brief 2-3 &
3 The defendants seem to concede as much when they note that, “Plaintiffs cannot evade the effect of consolidation when their own actions—namely, designating their derivative claims as ‘direct’—undoubtedly prevented the Clerk’s Office from taking the[] administrative step[] [of consolidating the Rafter action with the existing class actions].” Reply 4.
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n.1, Fairholme, No. 13 Civ. 465 (Fed. Cl. Nov. 21, 2014), ECF No. 107-1, the defendants seek to unwind the plaintiffs’ voluntary dismissal of this case. There is no doubt that the plaintiffs voluntarily dismissed their case as part of a broader litigation strategy—and not because they suddenly decided their claims had no merit. But strategic conduct in the face of high-stakes litigation is not a punishable offense.
III. CONCLUSION
For the foregoing reasons, it is hereby
ORDERED that the defendants’ motion to strike the plaintiffs’ notice of voluntary dismissal [17] is DENIED. This case remains dismissed.
Signed by Royce C. Lamberth, United States District Judge, on January 21, 2015.
Latest Fairholme filing
121
01/23/2015 NOTICE of Additional Authority Supporting Rafter Amici (Rosenberg, Lawrence)
Thanks Surfonium for posting this text and your last post with the video. In the video, he never answered the question why the gov thinks they can keep all net profits of Fannie, Freddie as opposed to the payback structure they had with the banks. We still have never received an answer. It seems the tone and language has changed though even since the last interview.
Here are the committee members in case we need to email any of them our thoughts before the hearing.
Jeb Hensarling, Texas, Chairman
Peter T. King, New York
Edward R. Royce, California
Frank D. Lucas, Oklahoma
Scott Garrett, New Jersey
Randy Neugebauer, Texas
Patrick T. McHenry, North Carolina
Stevan Pearce, New Mexico
Bill Posey, Florida
Michael G. Fitzpatrick, Pennsylvania
Lynn A. Westmoreland, Georgia
Blaine Luetkemeyer, Missouri
Bill Huizenga, Michigan
Sean P. Duffy, Wisconsin
Robert Hurt, Virginia
Steve Stivers, Ohio
Stephen Lee Fincher, Tennessee
Marlin A. Stutzman, Indiana
Mick Mulvaney, South Carolina
Randy Hultgren, Illinois
Dennis A. Ross, Florida
Robert Pittenger, North Carolina
Ann Wagner, Missouri
Andy Barr, Kentucky
Keith J. Rothfus, Pennsylvania
Luke Messer, Indiana
David Schweikert, Arizona
Bob Dold, Illinois
Frank Guinta, New Hampshire
Scott Tipton, Colorado
Roger Williams, Texas
Bruce Poliquin, Maine
Mia Love, Utah
French Hill, Arkansas
Maxine Waters, California, Ranking Member
Carolyn B. Maloney, New York
Nydia M. Velázquez, New York
Brad Sherman, California
Gregory W. Meeks, New York
Michael E. Capuano, Massachusetts
Rubén Hinojosa, Texas
Wm. Lacy Clay, Missouri
Stephen F. Lynch, Massachusetts
David Scott, Georgia
Al Green, Texas
Emanuel Cleaver, Missouri
Gwen Moore, Wisconsin
Keith Ellison, Minnesota
Ed Perlmutter, Colorado
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Great questions thank you! If he doesn't answer, maybe we should send questions to the Office of Inspector General since they do some auditing.
Agreed, like pre-shareholder meetings. I even listened to Icahn today too, assuming his still has his 12.6 million shares of Fnma, Fmcc common.