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The trial will take 2 or 3 weeks and the trier of fact, here a Jury, will have to decide whether or not Fannie Mae and Freddie Mac breached the implied covenant or contract that all shareholders have with the corporations they invest their hard earned capital with. That contract is simple, I invest my capital and as the owner of the corporation I am to share in the future profitability and not have the corporation give away all their future profitablity to a third party.
Then the Jurors will have to determine "with reasonable certainty", the amount of the losses from the breach of the Implied contract with shareholders and the corporations will have to pay the shareholders with assets from their balance sheet (e.g., cash).
But guess whose likely going to appeal the Jury verdict and determination of economic damages?
Although courts are typically reluctant to mess with Jury verdicts, they could possibly in the future do so if a compelling procedural appeal is made...
Ohhhhh, Uncle Suggy, you can run but you CANNOT HIDE from the theft of our companies! Here's a crazy idea, Uncle Suggy, why not conserve and preserve the assets of your wards, right the ship, and give us our companies back, like HERA says you should?
The government lawyers will likely argue to the Jury that shareholders knew or should have known that the federal government backing of the corporations was everything for these corporations and given their losses from 2008 through 2012, it was easily foreseeable that the federal government would require substantial commitments from the corporations including impediments on their future profitablity and therefore the Net Worth Sweep was foreseeable by shareholders, many of which are institutional investors.
But that's not right BECAUSE:
(1). Susan McFarland (CFO of Fannie Mae at the time of the NWS) said that the companies will be able to pay the 10% dividend on the bailout funds and that the $50 billion DTA would be available.
(2) The MBS guarantee is clearly stated in BOLD on the front page of every MBS that it is not backed up by the US Government
(3). These corporations were chartered by Congress in 1968 and 1970 as private corporations not federal agencies.
(4). The overwhelming evidence points to the motivations for the 3rd Amendment was to make sure that theses corporations "never go pretend private again" and designed to destroy Plaintiff Shareholder Value.
When the companies transferred all their future profits in return for nothing, they broke the fundamental promise that all companies have with their existing owners to share in their future profitablity with their owners.
All good points! That's why it's important to establish a single simple theme or idea throughout the trial, that the Jurors can latch onto.
For example, "This case is about how the federal government has transferred all the Economic Rights from Plaintiff Shareholders to itself."
Say it at Opening Statement
During direct and cross exam
Say it at Closing Statement
As Plaintiff Shareholders we all understand the injustice of the Net Worth Sweep on our shares, BUT WILL THE JURORS?
Then I believe we have to show with 'reasonable certainty' what the dollar amount of the damages from the Net Worth Sweep was.
Beginning October 17, 2022 @ 10am we will see how this unfolds. GLTA!
Justice Gorsuch said, "North Korea has greater freedoms in its Constitution than we do."
https://www.pbs.org/wnet/firing-line/video/neil-gorsuch-ebtjnk/
That's normally true in Criminal trials (this one is Civil, even though what Uncle Suggy did to us was pure and simple theft !)
In Washington DC I think about 2 to 3 out of 5 citizens that have jobs, works directly or indirectly for Uncle Suggy. Having never had to work for the private sector and when your employer will always be able to pay you tends to create citizens that believe the government IS the solution to many societal issues and tend to generally vote for your favorite party.
This can be played on by the Gubmint lawyers and may or may not directly influence the jury verdict.
The other interesting thing about people living in Washington DC is the proliferation of highly educated individuals that Uncle Suggy hires to carry out whatever the Legislative Branch appropriates funds for.
I am just guessing but I think that group could easily figure out WTF happened here and find accordingly.
But I'm pretty sure all these balls and strikes for running the trial calls by J. Lamberth will stand whether anyone likes it or not.
Well, pyrrhic wins have been the Modus Operandi of this bizarre Gubmint overreach. Maybe it's hard for federal Judges to rule against their Paymaster and a Jury would have no problem.
I believe that the standard is "reasonable certainty" in proving damages and listening to hours of "experts" explain how are shares have been stripped of all their Economic Rights and calculating a reasonably certain amount of damages may or may not be difficult for a Jury to grasp.
Clearly most Judges don't have fundamental accounting and finance backgrounds but they (like Jurors) remember the financial crisis and the hardships it wrought on millions of American Families.
I'd take a grand or two guaranteed versus a definite maybe any day but I feel your pain, Bro! I still might end up being available, if you are coming down then at a minimum let's meet for a meal in the afternoon or evening. Just send me a phone number and I'll call or text you Bro!
If you notice a man weeping profusely in front of the original US Constitution on Constitution Avenue, just say, "Robert from Yahoo board!"?
Don't get too excited, I will sell you guys out in a second if I get a client that pays me to work for them that morning, HeeeHeee !
Besides I wanted to attend the Johnny Depp trial at my local courthouse this Summer but it was a frickin zoo and there were lottery tickets to the goofball fans who waited overnight in line to get tickets!
Mostly love crazed women supporting Johnny Depp! Hilarious! Most entertaining court case ever! Judge Penney Azcarate let live cameras in and I watched it from the comfort of my casa!
Don't worry I seriously doubt many of the shareholders have the time to go see it live and the courtroom could be fairly empty, we'll see what happens.
Typically the most exciting parts are Opening and Closing Statements, most boring will be the egg head experts explaining the minutiae of corporate finance....
HeeeHeee! I bet Uncle Suggy uses its Voir Dire strikes to kick off as many Jurors with a Finance and/or Accounting background as possible!
If I don't have any scheduling conflicts for Monday, October 17, 2022, I will take the Metro Subway down there and give you my initial thoughts as soon as I am able.
I know that you will read them because you really do hope for the best and that Plaintiff Shareholders Justice will prevail at some point (otherwise you would have already left!).
But so far, you're pessimism has been spot on!
My bad! FOR SURE 1 week from next Monday! Don't worry, I think we have ALL been waiting a long time for this!
Wow! Unlike Tuesday through Friday, my schedule has Monday, October 17, 2021 still available!
I'll bring my cell phone and give my 'fellow travelers' an update whenever I am able!
But the fulcrum security possesses super powers unavailable to mere Commons! HeeeHeee!
Here's Where the trial will take place on Monday October 17th (not sure what time though, 10am?) if it's not rescheduled: 333 Constitution Ave Washington DC 20001
I think you can now take your cell phone in the courtroom as via the marvels of technology there will be no cell phone access inside the courtroom.
If you are from out of town you can go see the original US Constitution nearby and read it because apparently most federal Judges haven't read it in awhile !
I don't know the 5th Circuit typically doesn't take kindly to federal gubmint overreach. We'll see what happens, seems like it's a more productive thing to do than b*tch and moan amongst ourselves though, doesn't it?
HeeeHeee! Brilliant Rick! Only the Magic 8 ball knows for sure!
The federal government royally screwed up this CONservatorship by deciding to Nationalize the GSES instead of doing what HERA asked, conserve and preserve and return the entities to the private corporations that has worked perfectly for over 50 years before 2008.
The result is all this litigation.
The US Constitution is being increasingly ignored in this 14+year CONservatorship and it's disturbing to watch. We'll see how it ends.
Does it look like there is a split on the Acting Director issue in the 6th Circuit (ROP) and the 8th Circuit (Bhatti)?
Uncle Suggy doesn't need the $8T of MBS added to the $31T outstanding, from todays NYT (maybe they should reverse course on Nationalization of the GSES): "WASHINGTON — America’s gross national debt exceeded $31 trillion for the first time Tuesday, a grim financial milestone that arrived just as the nation’s long-term fiscal picture has darkened amid rising interest rates.
Higher rates could add $1 trillion to what the federal government spends on interest payments this decade, according to Peterson Foundation estimates. That is on top of the record $8.1 trillion in debt costs that the Congressional Budget Office projected in May. Expenditures on interest could exceed what the United States spends on national defense by 2029, if interest rates on public debt rise to be just 1 percentage point higher than what the CBO estimated over the next few years.
The CBO warned about America’s mounting debt load in a report earlier this year, saying that investors could lose confidence in the government’s ability to repay what it owes. Those worries, the budget office said, could cause “interest rates to increase abruptly and inflation to spiral upward.”
Eventually the dust will settle on these Plaintiff Shareholder lawsuits, but personally for me, I am enjoying the possibility of the federal judiciary finally reigning in some of this outrageous conduct and steam rolling of the Citizens Economic Rights by a bunch of unelected Bureaucrats in the 4th Branch of Government.
This ROP case may end up having the Supremes solve once and for all how long these holdover NON SENATE CONFIRMED (as required by a the US Constitution) Acting Federal Agency Directors can Lord over the lives of American Citizens.
Senate unconfirmed DeMarco, FHFA Acting Director, had quite an impact on our Economic Rights when he contractually obliged our Corporations to hand over ALL FUTURE PROFITS IN RETURN FOR NOTHING, didn't he?
Seems like a split in rulings between ROP and Bhatti, ROP is in 6th Circuit and Bhatti is in the 8th.
Who ya gonna call on to decide which legal opinion is correct?
Well, the Supremes of course, but it seems both cases, ROP and Bhatti are working their way up their respective Circuits ladders.
Nice! Judge Thapar's Dissent was persuasive, eloquent, and stressed the importance of this case on future American Jurisprudence and the duty of the Judicial Branch to do the heavy lifting necessary to restore Americans Liberty and Constitutional Limitations on the out of control 4th Branch of the federal government that has and exercises tremendous power by Unelected Bureaucrats over the American People.
https://www.law.virginia.edu/faculty/adjunct-profile/art2y/2320134
ROP was 2-1 on a 3 Judge Appeal. The Dissent said that the other 2 Judges ducked and covered and avoided doing the heavy lifting required here to rein in the other branches of the federal government.
Will an EnBanc Panel agree? Will SCOTUS accept a Petition for a Writ of Certerrori to finally reign in the other two branches of government for neglecting to Senate confirm these omnipotent and overlording UNELECTED FEDERAL BUREAUCRATS RUNNING THE 4TH BRANCH OF THE FEDERAL GOVERNMENT?
Stay tuned, for another episode of the Days of Our CONservatorship Lives.....
Judge Thapar's Dissent sets up the Petition for a Full EnBanc Panel/Petition for a Writ of Certerrori eloquently in the well reasoned dissent and concluded persuasively:
"In short, whichever metric we choose, DeMarco’s tenure violated the Appointments
Clause. No viable interpretation of the Clause permits an acting officer to skip confirmation for
three years under these circumstances. By the time DeMarco signed the Third Amendment, he
signed it unlawfully."
And post Collins, it's understandable that prospective Shareholders are unable to believe that the Rule of Law will finally come through for them as existing shareholders have experienced first hand.
But you can see how the courts are having trouble figuring out what to do here (especially when the Defendant is also ALL the Federal Judges Paymaster) with one of the most bizarre conservatorships ever. Whoever heard of a conservator taking all its wards assets for itself for NOTHING IN RETURN AND INCURRING ZERO NEGATIVE CONSEQUENCES?
Only in Amerika, Comrade, only in Amerika!
Well, MAYBE Uncle Suggy will finally have to pay up (from our corporations assets, no less!) for his theft of our Economic Rights and formerly Privately owned Corporations.
OR
Now that we have the thief backed into a corner, he's pulls a Harry Houdini?
I already know your answer SO I'LL SPARE YOU THE KEYSTROKES!
One of the problems facing legal counsel in this case is that Plaintiff Shareholders main theme or message (that Uncle Suggy stole our Economic Rights and Transferred them to itself and that this violated the implicit contract Plaintiff Shareholders had with respect to their Economic Rights under Virginia Law AND that the Jury can calculate Financial Monetary Damages with reasonable certainty) could easily get bogged down with hours of mind numbing accounting and finance expert witness testimony (especially right after lunchtime!).
The Opening and Closing Arguments will sum it up, but what Uncle Suggy did here with the 3rd Amendment is the most bizarre and blatant violation of Economic Property Rights and conservatorship law in US History!
"“Defendants cannot
simply say that since HERA permits the conservator to act in its own best interests, the FHFA can
do whatever it wants and Plaintiffs could not expect otherwise. The question is whether Defendants
exercised their discretion arbitrarily or unreasonably in a way that frustrated Plaintiffs’
expectations under the contract.” Fairholme Funds, 2018 WL 4680197, at *13.
Because HERA only authorizes the discretion through which FHFA agreed to the Third
Amendment, rather than the Third Amendment itself, the prohibition of implied covenant claims based on contractually authorized conduct does not bar plaintiffs’ claims and does not entitle
defendants to summary judgment."
"A breach of the implied covenant occurs where one party
“‘act[s] arbitrarily or unreasonably,’” which is to say that it “violate[s] the reasonable expectations
of the parties” at the time of contracting, Perry II, 864 F.3d at 631 (first alteration in original;
second alteration added) (quoting Nemec, 991 A.2d at 1126, and citing Historic Green Springs,
1993 WL 13029827, at *3).
Otherwise, “[t]he elements of an implied covenant claim remain those of a breach of
contract claim: ‘a specific implied contractual obligation, a breach of that obligation by the
defendant, and resulting damage to the plaintiff.’” ASB Allegiance Real Estate Fund. v. Scion
Breckenridge Managing Member, LLC, 50 A.3d 434, 444 (Del. Ch. 2012) (quoting Fitzgerald v.
Cantor, 1998 WL 842316, at *1 (Del. Ch. Nov. 10, 1998)), rev’d on other grounds, 68 A.3d 665
(Del. 2013); see also Charles E. Brauer Co., Inc. v. NationsBank of Virginia, N.A., 251 Va. 28, 33
(1996) (“The breach of the implied duty [of good faith and fair dealing] gives rise only to a cause
of action for breach of contract.”). In both Delaware and Virginia, the last element—damages
resulting from the breach—must be proven “with reasonable certainty.” SIGA Technologies, Inc.
v. PharmAthene, Inc., 132 A.3d 1108, 1111 (Del. 2015); see also MCR Federal, LLC v. JB&A,
Inc., 294 Va. 446, 462 (2017)."
Who structures a bailout that can NEVER BE REPAID NO MATTER HOW PROFITABLE THE COMPANIES BECOME?
That's my Uncle Suggy !
FHFA asked Treasury to allow the GSES to have the ability to pay down the Liquidation Preference on the eve of the 3rd Amendment Net Worth Sweep.
Treasury's response! "F**K YOU!"
Uncle Suggy, you're the BEST I TELL YA! THE BEST!
"By early 2012, the GSEs had turned a corner and begun to record net profits. PSAMF ¶ 37;
DRPSAMF ¶ 37. Nevertheless, the GSEs found themselves in a circular problem of having to draw
further on the Treasury Commitment to pay its required dividends to Treasury, and so on August 17, 2012, Treasury and FHFA adopted the Third Amendment to the PSPAs, the subject of the
parties’ present dispute. DSUMF ¶ 17; PRDSUMF ¶ 17. The Third Amendment replaced the fixed
10 percent dividend each GSE would pay to Treasury with a process known as the “Net Worth
Sweep,” whereby each GSE would be required to pay Treasury the difference between its net
worth and a predetermined capital reserve each year, with that capital reserve decreasing until it
reached zero in 2018. DSUMF ¶ 17; PRDSUMF ¶ 17; see Third Amendment § 2, Ex. FF to Defs.’
Mot. for S.J., Fairholme ECF No. 145-33, Class ECF No. 143-33. The Third Amendment thus
eliminated the circular-draw problem, but it also eliminated any future possibility for any non-
Treasury stockholder, including plaintiffs, to receive dividends from the GSEs, because the GSEs
owed their net worth to Treasury and would not take on further debt to pay dividends to other
shareholders. Importantly, the Third Amendment did not alter the Treasury Stock Certificates’
restrictions on paying down the Liquidation Preference. See id. § 3(a). Treasury and FHFA
amended the PSPAs three times after the Third Amendment, no amendment eased the existing
restrictions on paydown of the Liquidation Preference. DSUMF ¶ 10; PRDSUMF ¶ 10."
"In the course of negotiating the first two
amendments to the PSPAs, FHFA sent a letter to Treasury proposing a “simple revision to each
[Treasury Stock] Certificate, easing the impediments to optional paydown” to correct the original
Treasury Stock Certificates’ “unintended consequence of dissuading the companies from
repurchasing preferred shares when they are able,” Letter from A. Pollard to S. Albrecht (Feb. 25,
2009), Ex. I to Defs.’ Mot. for S.J., Fairholme ECF No. 145-10, Class ECF No. 143-10. However,
Treasury declined to adopt that proposed revision, DSUMF ¶ 10; PRDSUMF ¶ 10."
So you're saying that investors with Capital to invest don't want to enter into a Private/Public partnership with Uncle Suggy because he's NATIONALIZED the companies?
Well gee Wally, why wouldn't they?
1st case for the Supremes is one dealing with alleged federal agency overreach and property rights. By Amy Howe.
https://www.scotusblog.com/2022/09/epas-authority-over-wetlands-is-at-stake-as-justices-wade-back-into-regulatory-morass/
Rick might still have his Magic 8 ball is all I can tell you, but anyone who will testify at the Trial that is coming from out of state (maybe except NYC witnesses) may have already booked flights and stuff and as the date gets closer Judge Lamberth will be more and more reluctant to postpone, especially given just how long the 'salted to the Earth' Plaintiff Shareholders, (thanks Jimmy and O'Bummer!), have waited.
But it's up to His Honor, Judge Lamberth since it's his Courtroom and he will do what he wants to do. Federal Judges cannot be fired for the life of their job and will receive their pay regardless (unlike the unfortunate hard working American Families and Retirees that actually believed that a CONservator would actually Conserve and Preserve the assets of their wards instead of Salting the Earth with their carcasses and had their Economic Rights STRIPPED IN THEIR ENTIRETY!).
Theifing Gubmint! FINALLY a trial!
He NATIONALIZED OUR COMPANIES AND TOOK ALL OUR ECONOMIC RIGHTS VIA SOMETHING CALLED THE NET WORTH SWEEP!
Tick Tock! GO GOOD GUYS! BOO THE THEFT OF OUR ECONOMIC RIGHTS BY FHFA ACTING AS A CONservator whose DUTY IS TO PRESERVE AND CONSERVE, NOT TAKE THE SHAREHOLDERS ASSETS FOR ITSELF!
Without an Implicit or Explicit Federal Guarantee, 'free markets' are unwilling to underwrite 30 year PREPAYABLE Fixed Rate Mortgages. Fannie Mae and Freddie Mac help make this possible here in Amerika.
In the UK (and Canada) it's different, from yesterdays NYT: "While fixed-rate mortgages, ranging from two- to 10-year terms, are common in Britain, insulating many households for the moment, rising rates more immediately threaten first-time home buyers and those on variable-rate mortgages, which account for around a quarter of all mortgages, according to the Financial Conduct Authority. And more than a third of all mortgages are on fixed rates that expire within the next two years, most likely exposing those borrowers to higher rates, too. By contrast, the vast majority of mortgages in the United States are locked in for 30-year fixed terms."