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IMO en banc will remand to District Court.
The former-POTUS after-the-fact letter does not meet FRE 201 standards for judicial notice at the Appellate level. The defense deserves the chance to try to exclude it from evidence at trial but IMO it will be admitted; I am unsure if it will be admitted without first Defense getting to depose or cross-exam Trump. There are arguments on both sides: a FRE allowing it, but historical precedent *clearly allows and encourages* ex-Presidents to testify.
The Consolidated cases’ best evidence pled in the COFC (emails, depositions) is also still pre-trial and, so here again, would not qualify. If the COFC Appellate Court were to (surprisingly) direct a summary judgment for the Ps on a Taking, then the Fifth Crct might have a harder argument for remanding. But neither is likely to happen. There are open questions of fact and law in both Districts. Hurry up and wait. GLTA.
FHFA a branch? Branch, no. Thorn, yes.
Expert witnesses are not the same as material witnesses who generally can testify to only first-hand facts, and are also presumed too impartial to offer any sort of independent expert opinion or appraisal. Mario Ug., IMO, must have be just a material witness (in reality, a dumb door stop).
An opinion offered as expertise to try to persuade on the merits of a controversy is limited to people & subject matter meeting fairly uniform standards now (the Daubert for science, which finance obviously is).
Each party will buy services of a world class fee-based financial ‘sophisticate’.
My guess?
Ps look at conservative gurus with pedigrees from Harvard, Boston U, U Penn, Texas.
Ds will look at Yale, Stanford (liberal).
“that letter seemes to have thrown a wrench into all the court cases workings.”
I think it’s likely DC Circuit & the USCFC pushed “hold” on their statuses, once Fifth agreed to the unusual inter-remand Oral. But I think both courts will hear the oral argument as ‘no effect’. That’s how I heard it. Collins most likely remanded without anything added to the SCOTUS instruction for determining “compensable harm”.
I doubt DT letter will be given judicial notice at any court, nor do I think it is automatically excludable under federal rules of evidence. Ds know admissibility is quite feasible so the case is now ‘weightier’ for Ps. Its leverage, for now.
Presumably both USCFC and DC will immediately review today’s discussion and move forward. At *best* the DT letter is only circumstantial and tangential relevance value to the taking & bad faith.
kthomp19, thanks for the insight on your preference and strategy.
Louie Here is my Collins summary thru SCOTUS '21.
Ps Case CLAIMS
(1) FHFA exceeded its HERA Conservator powers, via the NWS; Ps demanded relief under the Administrative Procedures Act, 702 ("statutory claim") which mandates that courts "shall set aside" the action (NWS reversal).
(2) FHFA's structure under HERA violates the separation of powers ("Constitutional claim"); Ps demanded reversal of the NWS to-date.
I.
The District Court dismissed the Statutory claim and granted summary judgment in the FHFA's favor on the Constitutional claim.
IIa.
The Fifth Circuit "Panel" (3 judges) issued an opinion but it has been vacated (no precedential value).
IIb. Fifth Circuit En Banc:
(1) Reversed the District Court's dismissal of the statutory claim and found FHFA exceeded its powers, and, that Ps were entitled to Summary Judgment; however remedy was limited to injunctive relief (not NWS reversal); and
(2) Affirmed 9-7 that HERA violated separation of powers, but limited Ps remedy to just severance of the removal clause, and not vacating and setting aside the NWS.
III. SCOTUS
(1) Reversed the En Banc statutory claim opinion, holding (9-0) FHFA acted within HERA powers via the NWS [explanation omitted for brevity].
(2) Affirmed HERA removal clause does violate separation of powers, but holding (7-2) only for actions by a fully appointed Director. Thus the NWS was not reversible. But, later NWS actions could be reversible if (A) Taken by a full Director *and* (B) facts show the clause actually precluded POTUS from his duty to uphold execution of law
[Note: SCOTUS furnishes no definition or rule that to apply to meeting part B of this new '2 stepper'; instead, Alito lists 3 hypotheticals, stronger to weaker, suggesting persuasive strength along similar lines]
Sorry, ya I misunderstood you. Yep 80% max F/Fguarantee would go to the holder in due course.
In the GFC, some MIs survived (e.g., MGIC, Radian, GE), and a few big ones failed, but new ones sprung up immediately to fill the void (Essent, Triad, NMI).
Your last point is the key distinction that you hit upon but many folks cannot grasp or choose to ignore: it was F/F’s shift into building their own securities portfolios with *risky third party products*, (not the F/F ‘flow’ guarantee business) that was the major fly in the ointment, leading to HERA, FHFA & the rest … which is history … and probably future (if not simultaneously).
Cartoon: epic. Lol. I am stealing this.
Kinda wish you & kthomp19 would start over. Just press reset. Take a lesson from Danny LaRusso and Johnny Lawrence (“Cobra Kai”). Stop going at each other like a petty rivalry: nobody wins.
Instead, stake out common ground. A friendly but robust discussion of active case and legal issues might even uncover something that Ps ‘bus-stop bench lawyers’ have missed. Namaste. GLTA.
Really? You didnt know F/F buy and guarantee conventional loans over 80% LTV?!?!
You might be thinking of the fact that their charters preclude a guarantee exceeding 80%, which is true. But that doesn’t preclude them from buying & dealing in higher LTVs. To do so, a PMI company (e.g., MGIC, Radian, Essent) just has to commit to cover the ‘first loss position’ (eg., “20% cover”). This is all handled by automation via the originator, now. Click. Boom.
Still, F/F do NOT buy ‘purchase money’ loans over 97 LTV. But even at the 97 max, the buyers’ 3% down payment can now be a family gift, subject to underwriting approval.
Quote: “Yet we have contract rights in our shares? FHFA can vote our shares for us?”
Yes. But. The question of whether doing so would support a shareholder legal claim is IMO an unsettled one. The USG wants to name its haircut JPS price but prefers more leverage in the form of further rulings barring the front door (to name the “4–dog defense”: standing, failure to state a claim, HERA succession, and HERA anti-injunction). So they can just wait. IMO until a Fairholme-esqu case a survives a *final pre-trial dismissal motion*, the odds for Ps remain stacked. But I am rooting for Ps.
Now momentarily set aside HERA. There is also a ‘5th dog’: and he bites. Courts have a settled doctrine in federal takings of contract rights cases that is nearly impossiblr (the ‘4th branch’ makes its political living in large part by being empowered by Congress to interfere with third party contracts and rearrange private deals—all in ‘public interest’. Very common. If you want some related links lemme know.
That train has sailed.
Alito limited the remedy for compensable harm, *if any*, to acts taken (or wrongly barred) under a full Director.
The NWS was undertaken by an Asst Director. Not a full Director. So the NWS ‘in total’ is not reversible in this claim.
Alito made this very clear.
Gorsuch was the lone dissenting pen demanding a full reversal (IMO he makes good points, but for now the en banc Fifth is duty-bound to adhere to Alito’s majority as the new precedent).
HERA transferred that contingent right temporarily to FHFA as Conservator. The Director thus possesses the JPS right to vote (and IMO he would do so if triggered, but obviously just as a formality).
HERA does not require him to ask how you would’ve voted. And thanx to SCOTUS, as long as he acts within HERA authority, and his explanation rationally supports the public interest, such a decision survives an APA 702 challenge. So that legal door is nailed shut.
Still. Might a ‘Director-for-JPS vote’ be a new cause of action firm enough to support yet another claim? Maybe. Maybe not. I think the USG is delaying permanent F/F decisions until at least one of the two Fairholme cases resolves, one way or another. The losing party in COFC will apply for Writ of Cert with SCOTUS, who should decide by Xmas whether or not to hear it. And that will bear heavily on the recap timeline. So whatever future you want —we should see at last see the map reveal its hidden secrets (ala Harry Potter) by December 2022. Which is also after mid-terms.
Assuming SPS conversion, I assume you (as I) would still expect a reverse split?
That’s a possibility. Cannot deny it.
But upcoming court outcomes will have an effect on JPS too. Some like myself are overly cautious and even today hold no shares of any GSEs. But I remain interested and think a value buy may still be opportune. I personally an watching for some of the key legal disputes to advance just a bit further. 2022 may even surprise with several fireworks shows. We shall see.
I think Glen means, specifically, pre-judgment interest under common law, which can vary state by state. Contract claims are generally a creature of each state; Delaware’s code states 5% plus a kicker (last I saw).
Agree generally it *will* be simple interest, but…some courts have discretion to decide whether the interest should be simple or compound. See, e.g., Gotham Partners, L.P. v. Hallwood Realty Partners, L.P., 817 A.2d 160, 173 (Del. 2002) (although the Delaware Supreme Court explained that Delaware courts have "traditionally disfavored compound interest," it also noted that it is within a court’s discretion to award compound interest).
The majority of Americans, I don’t know.
As for myself I think rent control is a per se taking and should never have been allowed. But suspect I am a minority.
KT is correct. In Seila & Collins separation of powers cases SCOTUS faced a separate severance-type decision — not just with the offending clause (e.g., for-cause) — but whether the power itself could survive the change effected by the SCOTUS opinion. As KT intimates the court doesn’t always reveal all its thoughts, but in both Seila & Collins, its action (or perhaps its inaction, depending on your existential views) still has the same force of law. I suspect in Seila it was an analytical no-brainer that the CFPB should be able to go on issuing CIDs with or without ‘for cause’. CFPB can still issue CIDs. Of course.
It might have been a closer call on 4617(b)(2)(J)(2) had a different right been offended such as a first or sixth amendment right. But that was not the case. Moreover there is no guarantee that a constitutional claim alone would have standing(Collins deftly avoids that thorn). So FHFA can still make public-interest choices and choices against holders. As long as objectively rational even if bone-headed. Merry hristmas
Actually Carlos himself is omnipotent; he’s a first cousin of Q from the Continuum
Would that still work without a final resolution (whether a settlement, consent agreement or binding final court order on all material claims) ?
The new test for Removal of principal officers was laid out recently (in principle) in Seila Law by Roberts. In Collins, Alito’s opinion set it as controlling precedent.
This put an end to the old idea of trying to classify principal officers’ power by their functions (executive, quasi-legislative, quasi-judicial). To wit, in Seila, Roberts acknowledged *explicitly* that that old approach simply “does not track” how agencies are designed. (IMO the new test is neat also because it still retains the ad hoc balancing of functions *but relegates it to cases of inferior officers*.)
The test is simple, it asks: does a for-cause removal restriction apply to the head of a single-head agency, or, to the officials who lead a multimember agency?
Such restrictions are prohibited for a single-head, but allowable for multiple officials.
Congress can thus choose political accountability (at will single-head) or structural protections (e.g., FTC board) as a means of controlling agency power. But it cannot choose neither (See CFPB, FHFA).
Quote: “It would be very easy for a USCFC judge to say the same thing about the warrants, that the claim accrued when the original SPSPAs were signed. If that happens then the six-year statute of limitations in the USCFC expired long ago.”
Agree 100%. This has been my thought too. The idea that the norm is a right to wage a late-dated, cherry-picking war — one condition at a time without need of worry of a SOL, just strikes me as wholly inconsistent with the most basic of contract law underpinnings.
LOL. Story of my life.
Ya court red-lining of statutes is fraught with its own set of issues. The method may or may not be madness; but either way, it’s an entrenched madness.
I’m all for making FHFA more accountable. CFPB also has made too many bone-headed interpretive rules and prosecution decisions.
I’d make it a ‘two-for’: an omnibus act to fix both agencies. Dear US Senator, what the he*# are we waiting for?
SCOTUS set a precedent in Collins that lower courts MUST follow. A precedent includes an opinion on a controversy, and, a separate opinion explaining a judgment, the latter of which is better known as ‘remedy’.
In Collins, Alito’s remedy analysis (with *7 votes*) was old familiar ground: when deciding whether to just excise a clause, or, put the kibosh on a WHOLE statute, time & again, the same logic is repeated: ‘we think that given a choice at the law’s inception, Congress would’ve preferred the lawful statute (as we now explain it), to no statute at all’. That analysis —and the tiny number of relevant factors actually used by Alito in the lead opinion—preclude validity to the assertion you’re making. Whether Congress used the label “independent”,whether they insisted FHFA be run off budget, or whether it be run from a hidden base on the dark side of the moon, the fact remains that the agency structure had only 1 defect, and it was cured. If Congress wants to change things … so be it. But don’t leap to the conclusion that SCOTUS has any basis to do so. Been there, rejected that.
For Collins in the Fifth Circuit En Banc opinion following oral argument:
Yes, I think I would expect it by July. But there's always variables.
The good? Some of the usual dirty work is already done (Article III standing & a colorable claim) thanks to SCOTUS. That's a time-saver.
The bad? Well, Chef Alito whipped up a King Cake and air-mailed it back to New Orleans while it was only 'half baked'. He also attached a gift tag reading "Hi guys! The baby is in the cake, but split in 2 pieces. Sante!"
Today is National Donate Day. Well-timed.
Paste the citation link and I’ll review it.
Any claim based on execution of Warrants will be time-barred, due to statutes of limitations.
Correct. MF homes are personal property in about half the states. F/F can only guarantee mortgages on real property.
Robert. Yep. I know. I litigated hundreds of MH claims with some big fish.
You’ve not lived until you’ve visited an impassable mountain-dirt ‘driveway’ in Carolina, snaking up an alpine slope to a peak, whereupon you find a MF home’s DIY ‘addition’ had cracked and went over a cliff in a mud slide, pulling half the trailer along with it—leaving just its skirting. But I digress.
We hired auditors & found over 300 loans in 20 states that - by law - could not title the MF as a real property (rather it was via DMV). No one at the origination shops evidently found it odd that the title omitted the Alta 7 endorsements. Nor did GSEs spot check the title. So on most these cases the actual original LTV was not 97%, it was over 500% - lacking a dwelling of real property. Many were never resold after years of effort. Brought in wrecking ball guys. Total losses often > 100%.
I agree w/kthomp19
Agree with you. On the point of ('The debt won't need to be restructured because FnF have positive net worth'), also, I would posit that F/F debt won't be restructured because UST has expressly guaranteed they remain current while its commitments are in place.
If and When the UST commitment ends, I find it impossible to even imagine that a penny of F/F unsecured debt would go unpaid. Imagine a US debt rating downgrade; that alone would contribute significantly to a vote for replacing the dollar as world reserve currency. It's a nightmare of unimaginable consequences. I wish I could say it can't happen; but I used to think that about global pandemics. Consider me taken down 1
The alternative would risk the very nightmare scenario that Congress, POTUS, UST, FHFA (et al) ostensibly worked together so hard to avoid: namely, a downgrading of US debt, and -- invariably -- the dollar losing its annual GDP booster-shot from serving as world reserve currency.
In comparison, the Great Crisis would seem like little more than a dropped candle compared to this global nuclear-winter. Perish that t
SCOTUS is aware of the controversy this creates; it has constitutional dimensions.
While novel restrictions on land use are always suspect, states & localities are also traditionally given discretion to manage their housing. The last newsworthy SCOTUS Writ request was in 2019, but sadly it was declined for review (Chertz v Marin County). IMO that will change in the next 3-4years.
((Along with this issue, the whole ‘rent restriction’ legality —also a complete fiction— will be finally challenged. I expect it will come up as a side issue in pandemic litigation, quite possibly a catastrophe insurer cross-claiming against the USG.))
FWIW, what I’d like to see first happen — before resolution of GSE takeover cases & before the inevitable Inclusionary Zoning challenges, is … SCOTUS **finally and clearly** rewrite Takings law.
As I have said here before, Penn Central’s premise has always been a constitutional pile of donkey-doo doo. That case posits a false validity between public & private rights, which exists nowhere in the constitution. Yet, as law it continues.
Regulatory land-use restrictions, or their cousin ‘inverse’/affirmative restrictions (e.g., ‘pay to play fees’) should be treated under the *same analytical framework* as occupations and entrances onto private property. How? Easy: a taking is a taking: my right to exclude others has been impugned; whether diluted by 1% or 100%, the fact remains my right is no longer whole. It’s just a question of remedy. Then, let’s see if DeMarco is still smug.
Recall, Arrowood sued in the CAFC (fka Sweeney)& DC Circuit (Lamberth).
Glen posted recently that in the DC Circuit, Lamberth issued an order Nov 15 stating concerns about the DC plaintiffs' request to withdraw a class certification motion, in light of a stipulation by all parties to terms for the class action. In raising his eyebrow, Lamberth mentioned several court duties ... but ... he didn't elaborate on how they specifically apply there. So. Some guesswork on my part: Arrowood's requested and ordered voluntary dismissal (without prejudice) in the CAFC was already in the works prior to Nov 15 (as Plan B), and will be communicated over to Lamberth by Thanksgiving. Presumably this addresses Lambo's concern sufficiently, and the class certification procedure will resume there.
FWIW: FRCP state that if Arrowood's voluntary dismissal was its first such dismissal, Arrowood can simply refile there in the CAFC (1 free do-over).
Quote ‘I think judge Lamberth retired’. No. See DC court website & related news.
https://www.dcd.uscourts.gov/senior-judges
https://www.google.com/amp/s/thehill.com/regulation/court-battles/579935-judge-orders-jan-6-defendant-with-cancer-freed-after-deplorable%3Famp
“Considering that…” or “Given the fact that…”.
In contract law, the word ‘whereas’ is traditionally used in the very beginning section, called Recitals. Its use in that context is just a traditional way to state some background facts. But the general rule is that nothing stated in Recitals is binding on either party as a term or condition or otherwise. So again it’s really just a tradition. And a waste of ink.
FHFA values Acronym is ‘AIR’. As in, HOT.
I do not see any term limit for an Acting Director in the text of HERA, or in the Vacancy Reform Act, or elsewhere. Recall that DeMarco (he of the NWS) served as FHFA Acting Director for 6 years. The Social Security Admin had same Acting Director for over 20 years.