Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
The 5th Circuit did not say anything because the claims are barred by 12 U.S.C. § 4617(f) (Limitation on court action), this does not mean 4617(f) is in any way legal, or implicated the 5th circuit found § 4617(f) is legal, to the contrary
The 5th circuit found 12 U.S.C. § 4512(b)(2)TERM (for cause) to be illegal(& now SCOTUS too), so now 12 U.S.C. § 4511(a) Establishment (independent Agency) is unconstitutional as it has become an executive agency because the president has the right to fire the director, and because the president can do that and has that explicit full power over the FHFA, 12 U.S.C. § 4617(f) Limitation on court action (anti-injunction clause) becomes unconstitutional too, as otherwise the separation of powers of the 3 branches is breached, because the courts would have no power over the president, so either the founders of the constitution are wrong or the 5th circuit is wrong upholding the lower court § 4617(f) bars them to take action
sorry that was not an answer to my question, if you do not answer the question it is better to end the discussion as it does complement anything
my question was :
please explain why could the FHFA have a single director and can stay independent?
(12 U.S.C. § 4511(a) versus 12 U.S.C. § 4512(b)(2))
It is now established in Seila (and the 5th circuit ) the SCOTUS does not allow a single director for an independent agency with executive power
It does however allow a multimember boards for an independent agency, but since the court cannot re-write congresses intent, it only can void or hold illegal the things they in front of them
In this case the FHFA can be run by a single director but the ”for cause” provision needs to be deleted, when it is deleted the agency is “at will” of the president and can be seen as an executive agency that is under full control and will of the president, and no longer can fund itself thru assessments they make from Fannie and Freddie, so it will need to be included in the appropriations act and the word “independent” needs to be stricken with all consequences that causes as HERA is written for an independent agency and not for an executive agency
It is a domino event that is granted by the SCOTUS and a very good one for shareholders
? please enlighten your conclusion the FHFA can have a single director and can stay as independent agency? The president has the control and does not pay for this control ? but the people should pay for his control ?
o.k. let me try to explain
per the founders of the constitution there are 3 branches:
1) Legislative Power (the power to pass laws) to Congress
2) Executive Power (the power to administer the laws) to the President
3) Judicial Power (the power to interpret and enforce the laws) to the Courts.
Each of these branches should be able to control the other, so 1 should be able to control 2 and 3, and 2 should also be able to control 1 and 3 and most important 3 should be able to control 1 etc etc
So all branches need to be able to control each other
Then we have:
1) An Executive agency with a single director who is funded by the appropriations act
2) An Independent agency who is controlled by a multimember board (R&D) and is funded thru assessments
The FHFA however has a single director and is funded thru assessments and that is not a possibility as it conflicts the other 2 branches, a sinlge director that is funded by assessments has no accountability to the other branches
does this clarify somewhat
Look even further ahead, with for cause 12 U.S.C. § 4512(b)(2) the FHFA IS now an dependent/executive agency as the lawsuits in 5th circuit en banc, and SCOTUS Seila both said "for cause" is unconstitutional, so it slam dunk unconstitutional no other possibility
That being said, then the style of the agency is no longer independent as it is an executive style agency, that is now under the control of the president, right? (12 U.S.C. § 4511(a) (Establishment)
Then if we go further executive agencies are funded by the appropriations act and not thru assessments as the FHFA now does, so 12 U.S.C. § 4516(f)(2) needs to go
And to go even further an executive agency under the control of the president is not able to do as it pleases, the power it receives thru the president must be weighted so it is impossible for 12 U.S.C. § 4617(f) Limitation on court action to stay in HERA as the two other branches of the separation of powers are excluded in this process
Then it is also logical the FHFA, (because it is an executive agency under the control of the president)
cannot claim it is NOT under direction or supervision of any other agency in the United states so 4617(a)(7) need to be deleted too
Then for the NWS, no conservator is able to siphon off the profits of the entity they control, it is a slam dunk illegal per conservator statute “conserve and preserve”, and would be strange if it was legal, it never crossed my mind it is even a possibility, and that is also why we have so many lawsuits against the 3th amendment in the first place, so 4617(b)(2)(B) the word “MAY” needs to be deleted too as no agency can act out of self-interest or self-dealing per the law as it is in conflict with 5 U.S.C. § 706(2)(C), (D)
12 U.S. Code §?4617.Authority over critically undercapitalized regulated entities
(b)Powers and duties of the Agency as conservator or receiver
(2)General powers
(B)Operate the regulated entity The Agency may, as conservator or receiver—
(iv)preserve and conserve the assets and property of the regulated entity
It is not only “for cause” that is questioned, plaintiffs have established following to be outside the separation of powers:
5 U.S.C. § 706(2)(C) Scope of review (the reviewing court shall decide all relevant questions of law)
12 U.S.C. § 4511(a) Establishment (independent)
12 U.S.C. § 4512(b)(2)TERM (for cause)
12 U.S.C. § 4516(f)(2) NOT GOVERNMENT FUNDS (outside appropriations act)
12 U.S.C. § 4617(f) Limitation on court action
12 U.S.C. §4617(b)(2)(A) (i) succeed to all rights, titles, powers, and privileges
So if SCOTUS decides only “for cause” the others BECOME automatically
void ab initio, (it doesn’t matter if only “for cause” or all of them are illegal "for cause" is enough)
if one small part is missing in the engine the motor doesn’t work anymore that is the case here, HERA was written that way.
Well yes and no I understand your logic, but it is the independent structure with a single director that makes the FHFA unconstitutional, if it was a multimember board(republican and democrats) the decisions would be somehow balanced now a single director must comply to the president, but since it is independent it lacks authority from the president
The powers granted to FHFA are only that of a conservator (so not as they claim it can simultaneously act with power as receiver as they have done)
Mark Calabria said: “I respect the Supreme Court’s decision in the Seila Law case,”
https://www.nytimes.com/2020/06/29/us/politics/cfpb-supreme-court.html
This is great news, the Director now respects that when the same ruling in Collins comes, he will cease the shareholder fighting out of respect for the SCOTUS and cease all the frivolous claims accordingly
In Collins the following U.S. codes are under fire:
12 U.S.C. § 4511(a) Establishment
There is established the Federal Housing Finance Agency, which shall be an independent agency of
the Federal Government. https://www.law.cornell.edu/uscode/text/12/4511
12 U.S.C. §§ 4512(b)(2)TERM
The Director shall be appointed for a term of 5 years, unless removed before the end of such term for cause by the President. https://www.law.cornell.edu/uscode/text/12/4512
12 U.S.C. §§ 4516(f)(2) NOT GOVERNMENT FUNDS
The amounts received by the Director from any assessment under this section shall not be construed to be Government or public funds or appropriated money.
https://www.law.cornell.edu/uscode/text/12/4516
Then Collins asks the SCOTUS to rule for cause unconstitutional and wants the FHFA to operate as an executive agency that should be included in the appropriations act(because of § 4516(f)(2))
Then the director goes on to say:
According to me they can, but I’m not a judge and didn't figure out yet if it is checkmate
No, a conservator should in the first place conserve and preserve and not steal money from a company that under conservatorship and their actions became insolvent, and all under their control, then in Seila “for cause in unconstitutional, so we now know the actions taken by the single director are unconstitutional, if the director did what he had to do under the statute, the action could stay intact, but the single director(s) did not act according to the statute, so not all the actions can stay intact, for instance a single director agreed to the SPSPA, but would a multimember board also instantly agree?(if the companies are solvent at the time) or if it stays a single director how can you logically explain Ginnie is undercapitalized and Fannie and Freddie need to give away 79.9% of their company for no return, so then the fiduciary duty kicks in,
so in FHFA case it will either become
1) Independent single director with multimember board (republican and democrats who tend to end in a no decision)
2) Executive agency with single director and fiduciary duty (in all forms of it towards everybody)
A million possibilities but this doesn’t look good for the government, as it is not cricket, not cricket at all, and what we said years ago, don’t go this route, the embarrassment for the government is huge
not dead, none are lost so far, the case must be ruled upon merit and none of the 10 cases dismissed were ruled upon merit only technicalities that dismissed them, now Seila “for cause” is unconstitutional and voids 4617(f)Limitation on court action, A SUPER WIN for SHAREHOLDERS !!!!
Seila Law decision today
Although I didn’t read the entire 105 pages yet, I understand sofar
Following 3 cases are in for a win with Bhatti being the most important as it is long overdue anyway
1) 17-497 (1:17-cv-00497)
Rop v. Federal Housing Finance agency…….Common & Preferred, Derivative
Honorable: Paul L. Maloney
Claim: voiding 3th amendment & “for cause” separation of powers and
striking down HERA 12 U.S.C. §§ 4511(a), 4512(b)(2), and 4617(a)(7)
District Court, W.D. Michigan
https://www.courtlistener.com/docket/13521280/rop-v-federal-housing-finance-agency/
No next Date available (waiting on Collins, document 64 says “notice of supplemental authority concerning Collins v. Mnuchin” http://www.glenbradford.com/wp-content/uploads/2019/09/17-cv-00497-0064.pdf )
2) 18-2506 (17-2185) (0:17-cv-02185)
Atif F. Bhatti vs. FHFA……………Common & Preferred, Derivative
Honorable: Patrick Joseph Schiltz
District Court, D. Minnesota
Claim: 3th amendment & “for cause” separation of powers §?4512(b)(2)
https://www.courtlistener.com/docket/7379258/bhatti-v-federal-housing-finance-agency-the/
On appeal in the 8th circuit, Oral Argument 10/15/2019
http://media-oa.ca8.uscourts.gov/OAaudio/2019/10/182506.mp3
https://www.courtlistener.com/audio/65849/atif-bhatti-v-federal-housing-finance-agency/
(The court strives to issue the opinion within 90 days after oral
Argument or submission to a nonargument panel. http://media.ca8.uscourts.gov/newrules/coa/iops06-19update.pdf)
3) 18-3478 (2:18-cv-03478)
Wazee Street Opportunities v. United States………Common, Class action, Derivative
Honorable: Nitza I Quinones Alejandro
Claim: voiding 3th amendment & “for cause” separation of powers
District Court, E.D. Pennsylvania
https://www.courtlistener.com/docket/7681282/wazee-street-opportunities-fund-iv-lp-v-the-federal-housing-finance-agency/
Waiting on Collins as document 38 says Supplemental authority filed by Defendant ….. in the matter of Collins v. Mnuchin, No. 17-20364, now 19-422 / 19-563)
Then if we go the first amended prayer of relief from Bhatti
PRAYER FOR RELIEF
WHEREFORE, Plaintiffs pray for an order and judgment:
1. Vacating and setting aside the third amendment to the PSPAs, including its
provision sweeping all of the Companies’ net worth to Treasury every quarter;
2. Enjoining Defendants and their officers, employees, and agents from
implementing, applying, or taking any action pursuant to the third amendment to the
PSPAs, including its provision sweeping all of the Companies’ net worth to Treasury
every quarter;
3. Enjoining Treasury and its officers, employees, and agents to return to Fannie and Freddie all dividend payments made pursuant to the Net Worth Sweep or,alternatively, recharacterizing such payments as a pay down of the liquidation preference and a corresponding redemption of Treasury’s Government Stock rather than mere dividends;
4. Declaring that FHFA’s structure violates the separation of powers, that FHFA may no longer operate as an independent agency, and striking down the provisions of HERA that purport to make FHFA independent from the President and unaccountable to any of the three Branches of the federal government, including 12 U.S.C. §§ 4511(a), 4512(b)(2), 4617(a)(7), and 4617(f);
4511 (a)Establishment
There is established the Federal Housing Finance Agency, which shall be an independent agency of the Federal Government.
4512(b)(2)Term
The Director shall be appointed for a term of 5 years, unless removed before the end of such term for cause by the President.
4617(a)(7)Agency not subject to any other Federal agency
When acting as conservator or receiver, the Agency shall not be subject to the direction or supervision of any other agency of the United States or any State in the exercise of the rights, powers, and privileges of the Agency.
4617(f)Limitation on court action
Except as provided in this section or at the request of the Director, no court may take any action to restrain or affect the exercise of powers or functions of the Agency as a conservator or a receiver.
5. Awarding Plaintiffs their reasonable costs, including attorneys’ fees,
incurred in bringing this action; and
6. Granting such other and further relief as this Court deems just and proper.
Dated: August 4, 2017. BRIGGS AND MORGAN, P.A.
By s/Scott G. Knudson
So to sum up:
1) For cause removal is unconstitutional per SCOTUS
2) Bhatti/Collins are the first in line to come to a relief
3) Because “for cause” is illegal U.S.C. §§ 4511(a), 4512(b)(2), 4617(a)(7), and 4617(f); need to be stricken from HERA (see above)
4) and because of that and because SCOTUS thinks a single director has too much executive (unaccountable) power, 4617(f) also needs to be granted and because 4617(f) is granted the courts are allowed to rule and can take action
5) (a) Article II vests the entire “executive Power” in the President alone,
6) All cases that lack standing because of HERA 4617 certainly have merit and no longer can be dismissed because of 4617(f)
https://www.supremecourt.gov/opinions/19pdf/19-7_n6io.pdf
The lawsuits upto now only have positive rulings for plaintiffs, this is a slam dunk for plaintiffs, out of 42 lawsuits since 2012, none are lost!! It is 42:0
To make it even better the judges are misinformed by defendants (only thru discovery they learned) the judges also use language that is not soft in tone and we clearly understand that they do not agree with the things the government does
-------------------------------------------------------
Following cases are dismissed (without rulings on merit)
-------------------------------------------------------
1) Continental Western Insurance Company v. FHFA (14-42)( 4:14-cv-00042)
CASE LOST ON: HERA (—has already been decided by Perry Capital, Issue
preclusion applies even if a previous decision was decided wrongly, or in error) https://www.courtlistener.com/recap/gov.uscourts.iasd.51533.68.0.pdf
2) Rafter v. Department Of The Treasury (14-42)( 4:14-cv-00042)
CASE LOST ON: Voluntary Dismissal (one business day before Defendants dispositive motions)
https://www.courtlistener.com/recap/gov.uscourts.dcd.167678.20.0.pdf
3) Saxton v. Federal Housing Finance Agency (15-0047)(15-047) (1:15-cv-00047)(17-1727)
CASE LOST ON: HERA (a troublesome verdict for the government “no typo (8)” ”created a monster”)
https://cases.justia.com/federal/appellate-courts/ca8/17-1727/17-1727-2018-08-23.pdf?ts=1535038225)
4) Arnetia Robinson v. Fed. Housing Fin. Agency (15-109)(7:15-cv-00109)(7:15-cv-109)(16-6680)
CASE LOST ON: HERA (“Congress is the proper governmental body to address poor legislative decisions” )
https://www.courtlistener.com/opinion/4445969/arnetia-robinson-v-fed-housing-fin-agency/
5) Jacobs v. Federal Housing Finance Agency (1:15-cv-00708)(15-708)(17-3794)
CASE LOST ON: HERA (requested relief would effectively unwind the Third Amendment. Doing so would restrain or affect the Agency’s exercise of its powers as conservator(HERA))
http://www.glenbradford.com/wp-content/uploads/2018/11/17-3794-0033.pdf
6) David J. Voacolo V. Federal National Mortgage Association (1:16-cv-01324)(16-1324)(17-5667)
CASE LOST ON: Voacolo’s failure to reply and oppose the motion
https://gselinks.com/Court_Filings/Voacolo2/17-cv-05667-0020.pdf
7) Pagliara v. Federal National Mortgage Association (FNMA) (1:16-cv-00193)
CASE LOST ON: Failure to state a claim upon which relief can be granted
http://courts.delaware.gov/Opinions/Download.aspx?id=257440
8) Pagliara v. Federal Home Loan Mortgage Corporation (FMCC) (1:16-cv-00337)
CASE LOST ON: The Court has little confidence Pagliara seeks these records for valuation purposes the motion to voluntarily dismiss, and there appearing no opposition, the court grants the motion
https://www.courtlistener.com/docket/4536190/pagliara-v-federal-home-loan-mortgage-corporation/
9) Christopher Roberts v. FHFA (16-2107)(1:16-cv-02107)(17-1880)
CASE LOST ON: HERA, ((HERA) disempowers courts and existing stockholders, directors, and officers….HERA prevents this court from granting the relief requested)
https://www.courtlistener.com/opinion/4495195/christopher-roberts-v-fhfa/
10) Joshua J. Angel v. BOD of FNMA,FMCC & FHFA-C (19-7062) (1:18-cv-01142) (18-1142)
CASE LOST ON: Statute Of Limitations (Angel’s claims are time-barred)
http://www.glenbradford.com/wp-content/uploads/2020/04/19-7062-1839674.pdf
so when judge Benton, Kelly, and Stras think the government created a monster and still decide they cannot act in favor of plaintiffs because the (unconstitutional) law prevents them from ruling in favor it is a win for plaintiffs as unconstitutional is unconstitutional
Fairholme’s CFC 6 question comes out of the implied-in-fact contract that cannot be proven https://www.law.cornell.edu/wex/contract_implied_in_fact
It is one word against the other, and undoable to prove as none of the events that happened so far show they are allowed or even have consent and beside that it is unconstitutional as well, this will not be something the government can win, so it start with consent and it ends with no consent
If the BOD breached their duty of candor we run into several huge problems at ones:
1) All Lawsuits are lost by defendants as consent is missing because the BOD breached their duty of candor
2) To make it even worse the FHFA said continuously for more than a decade it had consent and acted upon it
3) And also the FHFA made sure the old BOD is not liable for the actions they took and even prevented the old BOD being liable for the actions they took (although I’m not exactly sure how it was played specifically, but that is the scope as I remember)
4) No court can take any action upon HERA
5) The FHFA can act out of self-interest
6) Self-dealing is proven
7) FHFA Hiding this beached duty makes them responsible for fiduciary duty
8) FHFA hiding fiduciary dudy makes them sole responsible for the implied covenant of good faith and fair dealing
Etc etc, whatever the judges do, don’t open this Pandora’s box, everything will be easier than the breach of duty of candor
this is how I read question numbers 6
“Fannie and Freddie were solvent before conservatorship, and the BOD can only act in the best interest of shareholders, so the BOD could only agree to conservatorship if FHFA agreed to act in the best interest of shareholders then is it LEGAL for FHFA to enter into conservatorship and act contrary to the consent they received from the BOD”
1) the BOD could only give consent to FHFA if shareholder rights are guaranteed because that is the duty of the BOD
2) see 1
3) –
4) FHFA has no fiduciary duty towards shareholders see 1)
5) You should read HERA and come to the conclusion if for cause is replaced by at will all the director wishes want/determines/ establishes lines need to be deleted and only regulation lines stay
6) no judge, pure common sense if you must preserve and conserve you cannot act in the best interest of yourself, in this case 10 lawsuits are dismissed because of 12 U.S.C. § 4617(b)(2)(J)
7) none of the “lost” cases was lost on merit, the problem is 12 U.S.C. § 4617(b)(2)(J) because they can act in their own best interest they can do whatever they want and because of 4617 (f)LIMITATION ON COURT ACTION the court may not take any action, but that conflict the separation of powers, so it is unconstitutional and needs to be stricken and resolved by court
8) (from another post) ALL lawsuits challenge the conservatorship itself
what is conservatorship, and who agreed to it, and why? (see 1) then if this is established and only then can there be a ruling on the lawsuits, so “all cases challenge the conservatorship” because if the consent is missing everything becomes unlawful and that is why we have an implied-in-fact contract which is not provable on paper and the old BOD needs to testify in order to come up with the answers, and if we receive answers from the old BOD either the BOD breached their duty of candor or the FHFA breached consent which is both a SUPER win for shareholders
? this is exactly what the lawyers claim and say
or do you think a lawyer says exactly what he means
When the lawyers says, “the 3th amendment is illegal”, the lawyer is unaware the judge must investigate if there was consent first? (This is the first thing they learn and why we have CFC#6 & the implied-in fact contract in the first place)
And if the judge finds no consent he/she only will rule the 3th amendment is illegal and leave the no consent document/implied-in-fact contract alone and the lawyers don’t take any action on the no consent? And no action will flow out of this determination, Everything stays the same?
“the 3th amendment is illegal” is brilliant from a lawyers point of view, it blames a minor details but eventually destroys the whole conservatorship
When the court says the conservatorship is illegal(in CFC#6),
1) the warrants will be put to rest
2) liquidation preference will be declared paid and interest needs to be paid over the initial sum
3) and the overcharge need to be returned plus interest
4) punitive damaged must be paid to all pref and common holders to make sure all the lawsuits go away in perpetually
5) missed dividends to prefs need to be paid and the prefs will be redeemed at par(at the cost of treasury)
6) the company needs to be changed again to : run for shareholder profits
7) the bod must be fired, and a new bod must be selected by the shareholders
8) the new bod must investigate what went wrong in order to prevent this event in the future
9) commons need to be relisted, common dividends must be reinstalled
When the court says the conservatorship is legal:
1) the constitution must be rewritten as the separation of powers is abandoned
2) now the government is god itself and it is a hard to claim democracy
3) later markets go in turmoil because of this total loss of trust in the system
4) dollar investments will be avoided and new capital will be harder to obtain
5) dollar will lose its Reserve Currency status
sorry forgot about that
for now that is Believer from Imagine Dragons
Let me put it differently, ALL lawsuits challenge the conservatorship itself
If you own a home, you can’t sell it if you are not the legal owner of that home, even if you lived in it for years and it really feels like your home
in this case it is the same, for FHFA it must be decided first “for cause” then 3th amendment then 12 U.S.C. § 4617(b)(2)(J) and if decided by court they are allowed per the constitution that they are the legitimate owners(acted properly on regulation) , they can do whatever they want, they can, however per the constitution you cannot do whatever pleases you, so there is the problem in ALL lawsuits
1) The BOD agreed to conservatorship because of that they have fiduciary duty towards shareholders
2) 1 because of that they could not have entered into the SPSPA without the BOD consent it is strange FnF funded the planned governments rescue, which cannot be repaid forever
3) The net worth is illegal
4) In interlocutory appeal they find FHFA did not act in the best interest of shareholders which all FHFA actions depend on (oeps)
5) In Collins(Seila v. CFPB) they find “for cause” problematic and needs to be stricken from HERA and all other regulation that allows to the director to act on self interest
6) because of 12 U.S.C. § 4617(b)(2)(J).)(act in the best interests of FHFA) is unconstitutional all authority they thought they had vaporizes
7) none of the 42 lawsuits against the conservatorship actions have been even slightly successful for the government
Not sure but I don’t see any light in the tunnel for the government
it doesn't, The relief common and preferred ask for is “the 3th amendment is illegal” It doesn’t favor preferred or common, the only way to settle the lawsuits is if Common and prefs receive damages (equal: not on cost of Common, but at the cost of Treasury)
if the 3th amendment is illegal prefs will receive missed dividends and common will receive missed dividends if any is left after the preferred are paid, but if CFC#6 fails for the government we have a whole different picture, and not sure what to think of that yet, for sure it will be dozens of times more expensive to settle as the whole current plan is deleted instantly, and fiduciary duty for direct claims is back in town
they have a Nowhere to Run situation
B or T doesn't matter
Yes all of the lawsuits are about the legality of conservatorship, as you cannot declare the 3th amendment legal if the conservatorship itself is not legal
you can only act on misbehavior, in your case an eventual warrant 79.9% dilution of your shares,
in that case the statute of limitation starts the day they are exercised
you would not be the only one
We soon will find out, the only thing that is important for preferred and common lawsuits is “was the conservatorship legal”
if it was legal prefs are not entitled to missed dividends and will receive nothing and all their lawsuits are dismissed
if it was illegal prefs receive missed dividends and subsequently par
if it was legal commons receive current common share value and all their lawsuits are dismissed
if it was not legal commons would receive a lump sum compensation and the increased share price compensation
I know A scenario
In interlocutory appeal they find FHFA did not act in the best interest of shareholders and because they only have an implied-in-fact contract the BOD could only have agreed to the implied-in-fact contract if the FHFA/FHFA-C acted in the best interest of the shareholders, otherwise the BOD could not have agreed to it, as the BOD would breach their duty of candor by agreeing not to act in the best interest of the shareholders
Preferred and Commons would not settle in the Washington federal case or if the 6th CFC question is unresolved, this is the crux, was or wasn’t it legal to act not in the best interest of shareholders, according to 46 lawsuits it wasn’t and according to FHFA/FHFA-C it was
6) “Whether plaintiffs’ allegations that the FHFA entered into an implied-in-fact contract with the Enterprises to operate the conservatorships for shareholder benefit fail as a matter of law.”
Thanks GUIDO!!
Yes correct but “the conservatorship” itself hasn’t been ruled on, so the question that defendant brings will jeopardize the whole conservatorship as it is not legal, to no one, except the FHFA
The page 5 doesn’t indicate to me Sweeney already decided in favor of plaintiffs, please explain further why you think she did
Not exactly sure what you are referring to, we had some partial rulings that more or less said the same thing but not “the conservatorship” fails as a matter of law, and question 6 can’t be severed either, if this one fails for defendants it’s over
Fannie Mae & Freddie Mac conservator Litigation, FNMA, FMCC updated June 23, 2020
19-422 Patrick J Collins v. Mnuchin (Pending petition SCOTUS) .…Common & Preferred, Derivative
Claim: “for cause” separation of powers §?4512(b)(2)
https://www.scotusblog.com/case-files/cases/collins-v-mnuchin/
(Decided according to David Thompson 1 week after resolution in Seila Law, ~first week of july-2020)
19-563 Mnuchin v. Patrick J Collins (Pending petition SCOTUS)…….Relates to all cases
Claim: § 4617(f) prevents ruling on 3th amendment, § 4617(b)(2)(A) (i) forbids challenging the Third Amendment
(Decided according to David Thompson 1 week after resolution in Seila Law, ~first week of july-2020)
https://www.scotusblog.com/case-files/cases/mnuchin-v-collins/
(13-1025 (1:13-cv-01025-RCL), 14-5243)
Perry Capital LLC v. Jacob Lew......Common & Preferred, Derivative
CLAIM: Derivative APA, 3th amendment
District Court, District of Columbia
Judge: Royce C. Lamberth
https://www.courtlistener.com/docket/4212073/perry-capital-llc-v-lew/
https://www.courtlistener.com/docket/3054444/perry-capital-llc-v-jacob-lew/
Court of Appeals for the D.C. Circuit
On appeal before Judge: Brown, Millett, Ginsburg
Consolidated with:
1:13-cv-01053, 14-5254(fairholme)
1:13-cv-01439, 14-5260 (Arrowood),
1:13-cv-01288, 14-5262 (In re: Fannie Mae/Freddie Mac Senior)
02/21/2017 following claims are remanded to the district court for further proceedings.
1) breach of contract and breach of the implied covenant of good faith and fair dealing regarding liquidation preferences
2) and the claim for breach of the implied covenant with respect to dividend rights, which claims we remand (to Lamberth) for further proceedings consistent with this opinion
https://www.govinfo.gov/content/pkg/USCOURTS-caDC-14-05243/pdf/USCOURTS-caDC-14-05243-1.pdf
13-1053 (14-5254) (1:13-cv-01053)
Fairholme Fund, Inc. v. FHFA……Preferred......Direct & Derivative
Honorable: Royce C. Lamberth
Claim: 3th amendment, breach of fiduciary duty, breach of contract, breach of the implied covenant of good faith and fair dealing
District Court for the District of Columbia
https://www.courtlistener.com/docket/4212077/fairholme-funds-inc-v-federal-housing-finance-agency/
RFP’s Granted https://www.courtlistener.com/recap/gov.uscourts.dcd.160910/gov.uscourts.dcd.160910.112.0.pdf
Fact discovery was to close on April 30, 2020, Trial was set for March 31, 2021 (with a pretrial 30-60 days before)
May 9, 2020 - The deadlines in the Second Amended Scheduling Order are hereby adjourned
pending further order of this Court, The parties are directed to submit proposed amended deadlines no later than June 30, 2020. https://www.courtlistener.com/recap/gov.uscourts.dcd.160910/gov.uscourts.dcd.160910.118.0.pdf
13-1288 (1:13-mc-01288)
In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement
Class Action Litigations ………………………… Common & Preferred, Class Action, Direct & Derivative
Honorable: Royce C. Lamberth
District Court for the District of Columbia
Plaintiffs demand a Trial by Jury
Direct claim, breaches of contract, breaches of the implied
covenant of good faith and fair dealing, breaches of fiduciary duties,
and violations of Delaware and Virginia law governing dividends
If the Direct claims are denied it also claims these Derivative: breaches of fiduciary duty, compensatory damages and disgorgement, breached the terms of the certificates of designation and the implied covenant of good faith and fair dealing, appropriate equitable and injunctive relief to remedy breaches of contract, breaches of the implied covenant of good faith and fair dealing, breaches of fiduciary duty, and violations of Delaware and Virginia Corporate law, including rescission of the Third Amendment. https://www.courtlistener.com/recap/gov.uscourts.dcd.163155/gov.uscourts.dcd.163155.71.0.pdf
https://www.courtlistener.com/docket/4212341/in-re-fannie-maefreddie-mac-senior-preferred-stock-purchase-agreement/
The Class:
1) N. Bradford Isbell ....... Common
2) Michelle M. Miller ...... Common
3) Charles Rattley ………… Common
4) Timothy J. Cassell ...... Common
5) 111 John Realty Corp… Preferred
8) United Equities Commodities Com ….. Preferred
6) 1:13-cv-01149 Joseph Cacciapalle ..... Preferred
7) 1:13-cv-01421 Marneu Holdings, Co .. Preferred
9) 1:13-cv-01169 American European Insurance Co ... Preferred
10) 1:13-cv-01443 Barry P. Borodkin ....... Preferred
11) 1:13-cv-01094 Mary Meiya Liao ....... Preferred
https://www.courtlistener.com/docket/4212341/in-re-fannie-maefreddie-mac-senior-preferred-stock-purchase-agreement/
Fact discovery was to close on April 30, 2020, Trial was set for March 31, 2021 (with a pretrial 30-60 days before)
May 9, 2020 - The deadlines in the Second Amended Scheduling Order are hereby adjourned
pending further order of this Court, The parties are directed to submit proposed amended deadlines no later than June 30, 2020.
https://www.courtlistener.com/recap/gov.uscourts.dcd.160910/gov.uscourts.dcd.160910.118.0.pdf
13-1439 (1:13-cv-01439)
Arrowood Indemnity Company v. Fannie Mae……Preferred....Direct & Derivative
Honorable: Royce C. Lamberth
Claim: 3th amendment, breach of fiduciary duty, breach of contract, breach of the implied covenant of good faith and fair dealing
District Court for the District of Columbia
https://www.courtlistener.com/docket/6995674/arrowood-indemnity-company-v-federal-national-mortgage-association/
Fact discovery was to close on April 30, 2020, Trial was set for March 31, 2021 (with a pretrial 30-60 days before)
May 9, 2020 - The deadlines in the Second Amended Scheduling Order are hereby adjourned
pending further order of this Court, The parties are directed to submit proposed amended deadlines no later than June 30, 2020. https://www.courtlistener.com/recap/gov.uscourts.dcd.160910/gov.uscourts.dcd.160910.118.0.pdf
16-3113 (4:16-cv-03113)( 17-20364)
Patrick J Collins v. Lew …………………….…Common & Preferred, Derivative
Honorable: Judge Nancy F Atlas in District Court
Claim: “for cause” separation of powers §?4512(b)(2)
https://www.courtlistener.com/docket/4533994/collins-v-lew/
Court of Appeals for the Fifth Circuit:
https://www.courtlistener.com/docket/6179579/patrick-collins-v-steven-mnuchin-secretary/
III. CONCLUSION
http://www.ca5.uscourts.gov/opinions/pub/17/17-20364-CV0.pdf
https://www.courtlistener.com/pdf/2018/07/16/patrick_collins_v._steven_mnuchin_secretar.pdf
We AFFIRM the district court’s order granting the Agencies’ motions to dismiss the Shareholders’ APA claims because such claims are barred by 12 U.S.C. § 4617(f).(no court may take any action)
We REVERSE the district court’s order granting the Agencies’ motion for summary judgment regarding the Shareholders’ claim that the FHFA is unconstitutionally structured in violation of Article II and the Constitution’s separation of powers, and we REMAND to the district court with instructions to enter judgment declaring the “for cause” limitation on removal of the FHFA’s Director found in 12 U.S.C. § 4512(b)(2) violates the Constitution’s separation-of-powers principles.
The 5th circuit remanded this back to Judge Nancy F Atlas in District Court, S.D. Texas, after a decision in Seila Law it will proceed (~first week of july-2020)
17-497 (1:17-cv-00497)
Rop v. Federal Housing Finance agency…….Common & Preferred, Derivative
Honorable: Paul L. Maloney
Claim: voiding 3th amendment & “for cause” separation of powers and
striking down HERA 12 U.S.C. §§ 4511(a), 4512(b)(2), and 4617(a)(7)
District Court, W.D. Michigan
https://www.courtlistener.com/docket/13521280/rop-v-federal-housing-finance-agency/
No next Date available (waiting on Collins, document 64 says “notice of supplemental authority concerning Collins v. Mnuchin” http://www.glenbradford.com/wp-content/uploads/2019/09/17-cv-00497-0064.pdf )
18-2506 (17-2185) (0:17-cv-02185)
Atif F. Bhatti vs. FHFA……………Common & Preferred, Derivative
Honorable: Patrick Joseph Schiltz
District Court, D. Minnesota
Claim: 3th amendment & “for cause” separation of powers §?4512(b)(2)
https://www.courtlistener.com/docket/7379258/bhatti-v-federal-housing-finance-agency-the/
On appeal in the 8th circuit, Oral Argument 10/15/2019
http://media-oa.ca8.uscourts.gov/OAaudio/2019/10/182506.mp3
https://www.courtlistener.com/audio/65849/atif-bhatti-v-federal-housing-finance-agency/
(The court strives to issue the opinion within 90 days after oral
Argument or submission to a nonargument panel. http://media.ca8.uscourts.gov/newrules/coa/iops06-19update.pdf)
18-3478 (2:18-cv-03478)
Wazee Street Opportunities v. United States………Common, Class action, Derivative
Honorable: Nitza I Quinones Alejandro
Claim: voiding 3th amendment & “for cause” separation of powers
District Court, E.D. Pennsylvania
https://www.courtlistener.com/docket/7681282/wazee-street-opportunities-fund-iv-lp-v-the-federal-housing-finance-agency/
Waiting on Collins as document 38 says Supplemental authority filed by Defendant ….. in the matter of Collins v. Mnuchin, No. 17-20364, now 19-422 / 19-563)
-----------------------------------------------------------------
Cases in Sweeney’s U.S. Court of Federal Claims
-----------------------------------------------------------------
20-121 (20-122) (13-465C) (1:13-cv-00465) (17-1122)(17-104)
Fairholme Funds, Inc. v. United States………..Common & Preferred, Direct & Derivative
Honorable: Margaret M. Sweeney
United States Court of Federal Claims
https://www.courtlistener.com/docket/4198608/fairholme-funds-inc-v-united-states/
Claim: **SEALED** 413 AMENDED COMPLAINT (Entered: 03/08/2018)
Redacted version without coercion attacks available at:
https://www.docketbird.com/court-documents/Fairholme-Funds-Inc-et-al-v-USA/REDACTED-DOCUMENT-filed-by-ACADIA-INSURANCE-COMPANY-ADMIRAL-INDEMNITY-COMPANY-ADMIRAL-INSURANCE-COMPANY-ANDREW-T-BARRETT-BERKLEY-INSURANCE-COMPANY-BERKLEY-REGIONAL-INSURANCE-COMPANY-CAROLINA-CASUALTY-INSURANCE-COMPANY-CONTINENTAL-WESTERN-INSURANCE-CO/cofc-1:2013-cv-00465-00422
March 9, 2020 the interlocutory appeal was granted the
CFC identified six “controlling questions of law” raised by its order, the first three of
which pertain to the CFC’s decision to dismiss Petitioners’ direct claims:
(1) Whether the court lacks subject-matter jurisdiction over plaintiffs’ direct
claims for breach of fiduciary duty and breach of implied-in-fact contracts.
(2) Whether plaintiffs who purchased stock in Fannie and Freddie after the
PSPA amendments lack standing to pursue their direct claims.
(3) Whether plaintiffs lack standing to pursue their self-styled direct claims
because those claims are substantively derivative in nature.
The last three controlling questions identified by the CFC related to its decision
to deny the motion to dismiss Petitioners’ derivative claims:
(4) Whether plaintiffs have standing to assert derivative claims notwithstanding HERA’s succession clause. (Fairholme & Fisher)
(5) Whether the [FHFA-as-conservator’s] actions are attributable to the United States such that the court possesses subject-matter jurisdiction to entertain plaintiffs’ derivative takings and illegal exaction claims. (Fairholme & Fisher)
(6) Whether plaintiffs’ allegations that the FHFA entered into an implied-in-fact contract with the Enterprises to operate the conservatorships for shareholder benefit fail as a matter of law.
http://www.glenbradford.com/wp-content/uploads/2020/03/20-121-0002.pdf
By no later than 14 days after the completion of that process (interlocutory appeal), the parties shall file a joint status report in which they propose further proceedings, if any are necessary.
June 18, 2020 Fairholme and Owl Creek entered their appeal, Fairholme’s appeal will be designated as the lead appeal http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/20-121.ORDER.6-18-2020_1605834.pdf
The following List Of Fannie Mae and Freddie Mac Shareholder Suits are Pending In The Court Of Federal Claims awaiting a decision in the Fairholmes interlocutory appeal, with below each group their stand on the interlocutory appeal, and further replies
1) 13-466C Joseph Cacciapalle ………..………… Preferred, Class Action, Direct*
https://www.courtlistener.com/docket/4198610/cacciapalle-v-united-states/
2) 13-496C American European Insurance.…. Preferred, Class Action, Direct
https://www.courtlistener.com/docket/4198611/american-european-insurance-company-v-united-states/
3) 13-542C Francis J. Dennis ………………….…. Preferred
March 27, 2020 above 3 Plaintiff’s think none of their counts should be dismissed
4) 13-385C Washington Federal v. United States . Common & Preferred, Class Action, Direct*
https://www.courtlistener.com/docket/4198605/washington-federal-v-united-states/
April 2, 2020 Plaintiff argues None of the claims in Fairholme apply to their case
April 16, 2020 the government thinks:
a) Fannie Mae And Freddie Mac Shareholders Lack Standing To Assert Substantively-Derivative Claims As Direct Claims
b) The Court Lacks Jurisdiction To Review The Merits Of The Enterprises’ Placement In Conservatorship
c) The Washington Federal Plaintiffs May Not Pursue Derivative Claims
5) 13-608C Bryndon Fisher (FNMA) .........….. Common Derivative*
https://www.courtlistener.com/docket/4198614/fisher-v-united-states/
June 11, 2020 interlocutory appeal process Granted on following
(1) Whether plaintiffs have standing to assert derivative claims notwithstanding HERA’s succession clause. (question 4 in fairholme)
(2) Whether the FHFA-C’s actions are attributable to the United States such that the court possesses subject-matter jurisdiction to entertain plaintiffs’ derivative takings and illegal exaction claims. (question 5 in fairholme)
6) 14-152C Bruce Reid (FMCC) …………………… Common Derivative*
https://www.courtlistener.com/docket/7737030/reid-v-united-states/
May 18, 2020 Fisher/Reid file motion to certify interlocutory appeal
June 4, 2020 Fairholme plaintiffs’ amicus brief in support of neither party
7) 13-672C Erick Shipmon……..…………………… Common Derivative
https://www.courtlistener.com/docket/4198615/shipmon-v-united-states/
March 27, 2020 above 3 Plaintiff’s think their claim is substantially the same as Fairholme’s
April 7, 2020 TRANSCRIPT of proceedings held on March 5, 2020 before Chief Judge Margaret M. Sweeney. Total No. of Pages: 1-77. Release of Transcript Restriction set for 7/6/2020.
8) 13-698C Arrowood Indemnity Company . Preferred Direct*
April 6, 2020 Plaintiff’s think none of the Fairholme counts apply to their case
May 15, 2020 the court dismisses plaintiffs’ claims because it lacks jurisdiction to entertain their fiduciary duty and implied-in-fact-contract claims, and plaintiffs lack standing to pursue any of their claims. The court therefore GRANTS defendant’s motion to dismiss.
May 15, 2020 waiting on appeal
9) 14-740C Louise Rafter .........…………………. Common Direct & Derivative*
https://gselinks.com/Court_Filings/Rafter/14-740-0027.pdf
March 31, 2020 plaintiff continue to stay until 21 days following resolution of Fairholme
10) 18-281C Owl Creek Asia I L.P...........………. Preferred, Direct *
11) 18-369C Akanthos Opportunity Master Fund .. Preferred, Direct *
12) 18-370C Appaloosa Investment .........……. Preferred, Direct *
13) 18-371C CSS LLC ……………………………………. Preferred, Direct *
14) 18-529C Mason Capital L.P...........………….. Preferred, Direct *
March 26, 2020 above 5 plaintiffs don’t want to give up the direct claims and doubt the counts in Fairholme properly represent their counts, and point out the law was breached
June 8, 2020 again a very damaging ruling for the government but still the case is dismissed as:
(FHFA can) “take any action authorized by [12 U.S.C. § 4617(b)),
which (it) determines is in the best interest of the (Enterprise) or the (FHFA)(Itself) .”
http://www.glenbradford.com/wp-content/uploads/2020/06/18-00281-0064.pdf
June 18, 2020 Owl creek files for appeal for ECF 64 for the Court of Appeals for the Federal Circuit
June 18, 2020 Fairholme and Owl Creek entered their appeal, Fairholme’s appeal will be designated as the lead appeal http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/20-121.ORDER.6-18-2020_1605834.pdf
15) 18-1124C Wazee Street……………….………… Common, Class Action, Direct & Derivative
16) 18-1150C Highfields Capital………………….. Common & Preferred, Direct
https://www.pacermonitor.com/public/case/25303845/HIGHFIELDS_CAPITAL_I_LP_et_al_v_USA Related To: Fairholme, Arrowood, Cacciapalle, 13-469, Dennis, Wazee Street, Fisher, Shipmon, Reid, Rafter, Owl Creek, Appaloosa, Akanthos, Css, Mason, 683 Cap. Partners, Patt
17) 18-711C 683 Capital Partners………..……….. Common, Preferred, Direct
18) 18-712C Joseph S. Patt………………………..… Preferred, Direct
19) 18-1226C Perry Capital LLC……………………. Common & Preferred, Direct & Derivative
20) 18-1155C CRS Master Fund LP…..…………… Preferred, Direct
Above 6 Plaintiffs are staying
21) 18-1240C Quinn Opportunities Master LP … Preferred, Direct
May 19, 2020 - Status unknown
* Jones Days plaintiffs
Sisti v. Federal Housing Finance Agency
Case number: 17-005 (90-1762)(17-042)
Honorable: John James McConnell, Jr
District Court, D. Rhode Island
Claim: FHFA, Fannie Mae, and Freddie Mac are government entities
https://www.courtlistener.com/docket/6900150/sisti-v-federal-housing-finance-agency/
March 24, 2020 Stipulation ~Until - Set Scheduling Order Deadlines
The Parties report to the Court that they are currently re-engaged in negotiations aimed at resolving the action. In order to afford the Parties with sufficient time to complete these discussions and discovery (if necessary), the Parties jointly request the Court extend the scheduling order deadlines by three (3) months to the following:
Factual Discovery to close by 6/30/2020;
Plaintiff's Expert Disclosures shall be made by 7/30/2020;
Defendants' Expert Disclosures shall be made by 8/28/2020;
Expert Discovery to close by 9/30/2020; and
Dispositive Motions due by 10/30/2020.
https://www.courtlistener.com/recap/gov.uscourts.rid.41482/gov.uscourts.rid.41482.53.0.pdf
When decided FHFA, FNMA and FMCC are government entities for matters of constitutional claims of due process and will confirm or not the paragraph nobody can take action while in conservatorship.
https://ecf.rid.uscourts.gov/cgi-bin/show_public_doc?2017cv0005-39
Seila law v. Consumer Financial Protection bureau (CFPB)
Decision in the last 2 weeks of June 2020
Case number: 19-7 (17-56324)
Court: Supreme Court of the United States
Issues: (1) Whether the vesting of substantial executive authority in the Consumer Financial Protection Bureau, an independent agency led by a single director, violates the separation of powers; and (2) whether, if the Consumer Financial Protection Bureau is found unconstitutional on the basis of the separation of powers, 12 U.S.C. §5491(c)(3) can be severed from the Dodd-Frank Act.
https://www.scotusblog.com/case-files/cases/seila-law-llc-v-consumer-financial-protection-bureau/
Transcript of argument on Tuesday, March 3, 2020.
https://www.supremecourt.gov/oral_arguments/argument_transcripts/2019/19-7_j4ek.pdf
Audio: https://www.oyez.org/cases/2019/19-7
1) Questions asked by plaintiff: for cause violates the separation of powers
2) The Court added a second question: can for cause be severed from Dodd-Frank Act
Plaintiff and the government agree on the first question that “for cause” violates the constitution, but disagree on the second question
Plaintiff contends reverse the judgment and either decline to reach the question of severability or declare it is not severable.
The government argues that the Court should remand for further proceedings.
(The decision in this case will decide on Collins SCOTUS 19-422 “backward-looking relief” witch the 5th circuit en banc declined)
Key takeaway:
1) Independent agency
2) Headed by a single director
3) Funded thru the Federal reserve Systems earnings
(Rather than through annual appropriations)
4) Days away from a ruling