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rek,
rek,
In FnF shareholder lawsuits, complaints are under many state and US laws like State corporate laws/ company bye laws, under APA, HERA, US Constitution,...
Since FHFA steps into the shoes of the Companies and acts on their behalf to defend alleged breaches of their obligations, state laws are equally applicable.
https://www.cadc.uscourts.gov/internet/opinions.nsf/66A4E1FEF4BB8401852580CE005620C3/$file/14-5243-1662090.pdf
p51: We need not reach the question whether the FHFA’s conservatorship of Fannie Mae and Freddie Mac endows the Companies with sovereign immunity because their “sue and be sued” clauses would waive any immunity.
P53: The Companies therefore remain subject to suit as private corporations for violations of state law just as they were before the FHFA was appointed conservator.
rek,
It should not matter. What matters is, Fnma (Fmcc) corporate bylaws specify that companies are subject to DE (VA) State corporate laws for the purpose of corporate governance. BTW Corporate laws are State matters so there are no federal Corporate laws.
"but in HERA I thought it directly stated that F&F will still be required to follow the state charter. "
Probably he is referring to OFHEO/FHFA regulations or GSE or HERA laws requiring FnF to adapt State Corporate laws for corporate Governance in FnF corporate bylaws.
Here is Hanna Doctrine which once again favors state laws in diversity jurisdiction.
Under the approach in Hanna v. Plumer, the federal court of a state hearing a case based on diversity jurisdiction should apply state law in the event of conflict between state and federal law if the state law deals with substantive rights of state citizens. The Supreme Court has defined substantive rights as, "rights conferred by the law to be protected and enforced by the adjective law of judicial procedure." An example of a substantive right would be a state law on fraud, which may vary widely in composition depending on the jurisdiction.
Newer approach of blending federal and state law
----------------------------------------------
Gasperini, and another recent Erie-area case, Semtek International Inc. v. Lockheed Martin Corp., have shown Erie has gone in a newer and even more complicated direction than the previous controlling cases, and that instead of selecting either federal or state law for a case, the federal court may be required to somehow blend federal and state law, depending on the issue.
rek,
I am not sure whether you have described Erie Doctrine correctly.
In effect, when the U.S. Constitution does not control and Congress has not legislated (or cannot legislate) on a topic, then the laws of the states necessarily govern and state judge-made rules are equally binding on the federal courts as state statutes.
Here is the link and short summary.
https://en.wikipedia.org/wiki/Erie_doctrine
The Erie doctrine is a fundamental legal doctrine of civil procedure in the United States which mandates that a federal court sitting in diversity jurisdiction (or in general, when hearing state law claims in contexts like supplemental jurisdiction or adversarial proceedings in bankruptcy) must apply state substantive law to resolve claims under state law.
There are two main objectives of the Erie decision: (1) to discourage forum shopping among litigants, and (2) to avoid inequitable administration of the laws.
May be for non-constitutional cases Congress has the authority to put conditions so that the cases can be heard in specific courts.
But can Congress put conditions on constitutional cases?
Navy,
Thanks, It is up to you. You know him better than us.
Former Chief Justice Steele was Judge Steele before he became Chief Justice Steele.
May be below brief introduction gives some clues.
http://www.potteranderson.com/attorneys-Myron-Steele.html
"But since that has been the law since the beginning of this country and is part of the Constitution, it will likely not be changed any time soon"
rek, Thanks,
1. Can you please give the reference to "part of the Constitution" that makes it legal to exempt any entity from judicial review.
2. Is it legal to exempt any entity from
1. judicial review and
2. checks and balances with separation of powers and
3. Creating Authorities outside the review of three branches of Gov
4. Delegation of any Gov authorities to private entities
3. Can Congress put conditions on complaints for actions under constitution so that it can be heard only in specific courts?
Can congress do the same with SCOTUS?
Navy,
It is confusing for some when you refer Myron Steele, former Chief Justice of the Delaware Supreme Court as "Judge Steele".
The better and more respectable way is refer as Myron Steele, former Chief Justice of the Delaware Supreme Court.
Or may be "Justice Steele" is ok.
rek,
Thanks, Please read SPSPA and amendments.
Below are some of sections that affect the terms of the agreement.
SPSPA and Amendments are governed by US federal laws to the extent applicable, otherwise NY State laws are applicable.
How is that no one has challenged SPSPA and NWS under NY State laws?
To what extent Delaware State laws are applicable?
Looks like multiple state laws are applicable here.
----------------------------------------
https://www.fhfa.gov/Conservatorship/Pages/Senior-Preferred-Stock-Purchase-Agreements.aspx
6.4. Governing Law; Jurisdiction; Venue. This Agreement and the Warrant shall be governed by, and construed in accordance with, the federal law of the United States of America if and to the extent such federal law is applicable, and otherwise in accordance with the laws of the State of New York. The Senior Preferred Stock shall be governed as set forth in the terms thereof. Except as provided in section 6.1 and as otherwise required by law, the United States District Court for the District of Columbia shall have exclusive jurisdiction over all civil actions arising out of this Agreement, the Commitment, the Senior Preferred Stock and the Warrant, and venue for any such civil action shall lie exclusively in the United States District Court for the District of Columbia.
2008-9-26_SPSPA_FannieMae_RestatedAgreement_N508.pdf
6.10. Remedies. In the event of a breach by Seller of any covenant or representation of Seller set forth herein, Purchaser shall be entitled to specific performance (in the case of a breach of covenant), damages and such other remedies as may be available at law or in equity; provided, that Purchaser shall not have the right to terminate the Commitment solely as a result of any such breach, and compliance with the covenants and the accuracy of the representations set forth in this Agreement shall not be conditions to funding the Commitment
2009-5-6_SPSPA_FannieMae_Amendment_508.p
10. Amended and Restated Agreement to Coptinue, as Amended.
Except as expressly modified by this Amendment, the Amended and Restated Agreement shall continue in full force and effect.
2009-12-24_SPSPA_FannieMae_Amendment2_508.pdf
10. Existing Agreement to Continue, as Amended.
Except as expressly modified by this Second Amendment, the Existing Agreement shall continue in full force and effect.
2012-8-17_SPSPA_FannieMae_Amendment3_508.pdf
8. Existing Agreement to Continue, as Amended. Except as expressly modified by this Third Amendment, the Existing Agreement shall continue in full force and effect
"The herb patience does not grow in every man's garden".
Very good quote. 100% correct.
That is why many investors are invested long in FnF stocks for more than 5 to 10 years.
rek,
It happens everyday. Parties violate/default private contract terms knowingly or unknowingly. In FnF case the contract itself trumped the laws.
In such cases what other party can do ("other than they can not")?
Can they sue and argue that even though contract itself trumped the laws, they want to enforce contract?
Please read Perry appeals ruling, FHFA conservatorship can do anything and there are no injunctive reliefs. Unfortunately even Tsy also argued similarly on behalf FHFA conservatorship to prevent judicial review.
After this if Tsy changes it arguments then, what happens to Perry appeal's ruling?
"Unfortunately - they think this is what they did."
If you are speaking for them, then that means,
you agree that what they did was wrong and unlawful.
you agree that they faked and lied all the way for the last 10 years.
"They thought that the f&f model was unrepairable and thought the only solution was to start over from scratch. "
Congress did not authorize them to make changes to GSE act or HERA or FnF model or restart all over. If Congress were to authorize them to do all these things then what is left for congress to do now?
If they thought all this was lawful then why lie all the way, why resist judicial review.
Unfortunately it is basically spinning the giant wheel of lies. Unfortunately cronies have made billions with their lies and shareholders have paid the price for their lies.
The mandate for FHFA was to stabilize housing markets and regulate them so as to prevent any future crisises.
Congress did not mandate FHFA to fake it so that it can seize FnF and put FnF under conservatorship.
Congress did not mandate FHFA to fake it so that it can write off FnF assets recklessly and force SPSPA on FnF.
Congress did not mandate FHFA to fake it so that it can bankrupt FnF using NWS.
Congress did not mandate FHFA to fake it so that it can force NWS urgency upon congress to act under pressure.
Congress did not mandate FHFA to fake it so that it can use NWS to start another big crisis and create risks and uncertainty for all .
FHFA is doing all these fakings on its own for the benefit of cronies.
That It would rattle the markets.
Sure if Gov agencies starts gabbing private profits and properties.
ShadowCopper,
Shorties are obama fans, and want to be part of welfare society and also favorite obamacare.
Is that they are quietly unwinding derivative positions?
One has to agree with your factual allegations.
"that statement is inflammatory and assumes knowledge of intent."
From discovery documents it is very clear that Obama Tsy official including TimG discussed this with all including WH officials, FHFA officials, auditors, and private consultants. After this NWS was implemented with all being aware of ensuing Golden age. Only missing documents are the ones directly linking Obama with NWS, withheld under various privileges. It is unconceivable that Obama would not have known about NWS involving 100s of billions of dollars of free revenue for tax payers.
Here there are two clear intents that come out from discovery documents. One is to grab all the profits to prevent other shareholders getting any of it and also mainly prevent capital accumulation. The other sinister intent was to bankrupt FnF with liquidating and grabbing $600M of assets every year.
So knowledge of intent is not speculative.
Besides that is what is happening with FnF conservatorship NWS since 2012.
So it is factual.
Are factual allegation inflammatory?
Is it not a perjury by FHFA conservator EdDemarco?
EdDemarco should be held responsible for this perjury.
These things do not happen at individual level.
Auditors are also involved in this heist.
People are trying to confuse others about number 100%.
Here the complaint is about one class of majority shareholder taking all the profits to the exclusion of all other shareholders in order to bankrupt the company.
"Mel can't and won't stop the NWS alone. "
rek,
Did you listen to Mel Watt congressional testimony.
Mel Watt said SPSPA/NWS is private contract and he has the authority to stop the payments. None challenged Mel Watt's authority even though some tried to dissuade Mel Watt from doing so for obvious reasons that it will affect their investments and expectations.
Will any Gov official make such statements in Congress without knowing what they are talking?
contrarian bull,
You make a very valid point.
The dividend rate is more than 100% of the profits that includes part of the net worth every year until FnF go bankrupt.
The FHFA, Congress MBA, MSM, financial establishment and judges see nothing wrong with Gov bankrupting highly profitable private shareholders companies. How does this protect taxpayers or serve the public?
The more they talk, the more embarrassment for them.
Navy,
you are doing great service to FnF shareholder community.
Myron Steele, former Chief Justice of the Delaware Supreme Court is one of the most knowledgeable expert about Delaware Corporate Laws.
People have great hopes in this case.
If FHFA continues to litigate, the case may be decided by SCOTUS.
Thanks for great work.
Steve Hilton currently serves as the host of FOX News Channel’s (FNC)
"The Next Revolution with Steve Hilton (Sundays at 9PM/ET)".
Hilton features a segment called “SwampWatch”, which provides opinion and analysis about the agencies, industries, and political groups that are affecting President Trump’s pledge to “drain the swamp.”
http://www.foxnews.com/person/h/steve-hilton.html
It is a good idea for all of us to tweet Steve to feature “SwampWatch” on 2008 crisis, fake FnF conservatorship, lawless NWS, and FnF shareholders saga.
https://twitter.com/SteveHiltonx
Please take time tweet Steve urging him to take look at FnF shareholders saga.
Does realism also includes legal expertise?
May be good idea. I assume we need real name.
But who knows what real name of realist may reveal?
Clark6290,
Thanks, With these comments you make model "realist".
These comments are valuable aid to realistic investors to make investment decisions.
We have not heard anything other than rhetorics from along.
It is time for along to provide some analysis based on facts.
Very good action plan.
Please check with Investor Unite whether they can help on this.
Investor Unite sponsored 2 events in WDC, bringing people from different states.
It is time to let go bummer legacy Mel Watt.
It is some what surprising, considering that Carney opposed DJT during elections. After elections WSJ dumped him.
It looks like John Carney is well connected with Corker and his investments funds. So Carney always spins any news against FnF.
Carney's conservative views are aligned with financial establishment, so probably someone from MBA might have recommended him to BNN.
"bcde: And Hillary would have been elected. "
duckdynasty, Very true.
Nobody controls Internet based media.
Anybody can write and publish.
Also one can chose to read what they want.
Without internet media, FnF would have been long gone with the fake conservatorship and the fake news.
rek,
HERA does not supersede State corporate laws. Perrys appeals court ruled on this.
Now internet is the MSM.
The one you referring to is CSM - corporate sponsored media.
The Car example may not be right example. If car is sold to another person, the original car owner and original insurance company are still responsible for the accident. If this original insurance company is acquired by another insurance company, the new insurance company is responsible for the liability along with original car owner.
In FnF case, it is about corporate contracts and securities transactions.
It should depend on State corporate laws on how things are handled in share transfers and what rights are transfered and who has the rights to taking claims.