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The SPSPA needs to be voided because of the fiduciary duty FHFA currently has towards minority shareholders, sofar the FHFA was able to do as it wishes, but after the 5th circuit en banc, it is realizing the wrongdoings is not something they are able to keep going on forever, in the SPSPA are 6.7 and 6.12, but it is regular law, they added the word “purchaser” but it still is regular law, and since it is regular it is not something they can claims is exclusive for treasury only,
“A contract may be deemed void should the terms require one or both parties to participate in an illegal act”
https://www.investopedia.com/terms/v/voidable-contract.asp
and since the 3th amendment is declared illegal by the 5th circuit en banc the SPSPA is a voidable contract, and since FHFA currently has fiduciary duty toward the minority shareholders, it will have to void the contract as any world-class regulator would do
FHFA-C is our friend and has the same goal as we have, maximize the profits for its shareholders, because the company is already in max profit territory
And Indeed the NWS action will cost treasury hundreds of billions of dollars because of this law:
5th circuit en banc granted:
Count I, they allege the Administrative Procedure Act (APA), 5 U.S.C. § 706(2)(C), (D),
(2)hold unlawful and set aside agency action, findings, and conclusions found to be—
(C)in excess of statutory jurisdiction, authority, or limitations, or short of statutory right;
(D)without observance of procedure required by law;
affords relief because FHFA exceeded its statutory conservator authority under 12 U.S.C. § 4617(b)(2)(D).
(b)POWERS AND DUTIES OF THE AGENCY AS CONSERVATOR OR RECEIVER
(2)GENERAL POWERS
(D)Powers as conservator The Agency may, as conservator, take such action as may be—
(i)necessary to put the regulated entity in a sound and solvent condition; and
(ii)appropriate to carry on the business of the regulated entity and preserve and conserve the assets and property of the regulated entity.
The explanation the 5th circuit en banc gives for granting on Count I :
Count I, to the extent it has merit, 1s a direct claim. The Shareholders
suffered injury in fact—they were excluded from the GSEs’ profits. And they
are within the zone of interests HERA protects. Count I alleges that FHFA
violated 12 U.S.C. § 4617(b)(2)(D)—the grant of conservator powers. The
Shareholders’ economic value is “arguably within the zone of interests” for this
provision. It is axiomatic that shareholders are the residual claimants of a
firm’s value. They are among the first beneficiaries of the “sound and solvent
condition” that a conservator is empowered to pursue. And they ordinarily
have a claim on the “assets and property” that a conservator 1s empowered to
“preserve and conserve. For example, in James Madison, the D.C. Circuit
held a bank shareholder could challenge the FDIC’s appointment as the bank’s
receiver under FIRREA.
Plus, HERA elsewhere states that the succession provision does not
extinguish the Shareholders’ right to pursue their claims in receivership. This matters because Count I essentially alleges that an improper
conservatorship preempted rights that could have been redeemed in
receivership. Because the Shareholders are within the zone of interests
protected by HERA’s enumeration of conservator powers, they have a direct
claim.
And the prudential shareholder-standing rule does not change this
analysis. The rule is “a strand of the standing doctrine that prohibits litigants
from suing to enforce the rights of third parties. But for APA claims,
“Congress itself has pared back traditional prudential limitations. The APA
does not abolish the shareholder-standing doctrine. But it limits it in some
cases. James Madison is one example, because the court held it had jurisdiction
to review the shareholder’s APA action against appointment of a receiver. The Supreme Court decisions City of Miami and Lexmark also support this
point: For very broad statutory rights like the APA, an injury in fact and
inclusion in the zone of interests can add up to a right of action, even if
prudential standing limits would have blocked it. That is the case here.
In so holding, we do not say that there is no direct—derivative distinction
for APA claims. Nor is it true that any shareholder may obtain review of agency
action affecting his holdings. In Thompson v. North American Stainless, LP,
the Supreme Court rejected the “absurd” proposition that shareholders could
sue under Title VII employment protections. Shareholders are not within
Title VII’s zone of interests because “the purpose of Title VII is to protect
employees from their employers’ unlawful actions. But a corporate
reorganization statute is a different animal. Shareholders may be within its
zone of interests, and here they are.
FAIRHOLME FUNDS, INC. v. UNITED STATES Interlocutory Appeal
13-465C………..Common & Preferred
PLAINTIFFS’ MOTION TO CERTIFY INTERLOCUTORY APPEAL
DEFENDANT’S MOTION TO CERTIFY THE COURT’S DECEMBER 6, 2019
OPINION FOR INTERLOCUTORY APPEAL AND TO STAY FURTHER PROCEEDINGS
Plaintiff and Defendant filed a motion for interlocutory appeal on Feb 21, 2020, Sweeney granted and denied following claims and Defendant and plaintiffs want to amend the appeal with following,
GRANTED By Judge Sweeney
COUNT II
Just Compensation Under the Fifth Amendment
for the Taking of Private Property for Public Use
(Derivative Claim on Behalf of Fannie Mae by Plaintiff Barrett)
COUNT III
Just Compensation Under the Fifth Amendment
for the Taking of Private Property for Public Use
(Derivative Claim on Behalf of Freddie Mac by Plaintiff Barrett)
COUNT V
Illegal Exaction Under the Fifth Amendment
(Alternative Derivative Claim on Behalf of Fannie Mae by Plaintiff Barrett)
COUNT VI
Illegal Exaction Under the Fifth Amendment
(Alternative Derivative Claim on Behalf of Freddie Mac by Plaintiff Barrett)
Count VIII
Breach of Fiduciary Duty
(Derivative Claim on Behalf of Fannie Mae by Plaintiff Barrett)
Count IX
Breach of Fiduciary Duty
(Derivative Claim on Behalf of Freddie Mac by Plaintiff Barrett)
COUNT XI
Breach of Implied-in-Fact Contract Between the United States and the Companies
(Derivative Claim on Behalf of Fannie Mae by Plaintiff Barrett)
COUNT XII
Breach of Implied-in-Fact Contract Between the United States and the Companies
(Derivative Claim on Behalf of Freddie Mac by Plaintiff Barrett)
DENIED By Judge Sweeney
COUNT I
Just Compensation Under the Fifth Amendment
for the Taking of Private Property for Public Use
(Direct Claim by all Plaintiffs)
COUNT IV
Illegal Exaction Under the Fifth Amendment
(Alternative Direct Claim by All Plaintiffs)
Count VII
Breach of Fiduciary Duty
(Direct Claim by All Plaintiffs)
COUNT X
Breach of Implied-in-Fact Contract Between the United States and the Companies
(Direct Claim by All Plaintiffs)
https://www.courtlistener.com/recap/gov.uscourts.uscfc.28224/gov.uscourts.uscfc.28224.449.0.pdf
the government want to amend the interlocutory appeal with following questions:
(1) Whether plaintiffs have standing to assert derivative claims notwithstanding the succession clause contained in the Housing and Economic Recovery Act of 2008 (HERA),
12 U.S.C. § 4617(b)(2)(A)(i).
(2) Whether actions by the Federal Housing Finance Agency (FHFA) as conservator for Fannie Mae and Freddie Mac are attributable to the United States such that the Court possesses subject-matter jurisdiction to entertain plaintiffs’ derivative takings and illegal exaction claims.
(3) Whether plaintiffs’ allegations that 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/2020/02/13-465-0456.pdf
Fairholme wants to amend with :
include a statement finding that the Court’s decision dismissing those direct claims involves controlling questions of law with respect to which there are substantial grounds for difference of opinion, and further finding that an immediate appeal from that order may materially advance the ultimate termination of this litigation.
(in short: including a statement that the appeal does not give the direct claims)
http://www.glenbradford.com/wp-content/uploads/2020/02/13-465-0457.pdf
Interlocutory appeal
https://www.law.cornell.edu/wex/interlocutory_appeal
Appeal from an interlocutory order. Interlocutory appeals are extremely rare; a three-part test determines whether the collateral order exception to res judicata makes such an appeal possible:
1. the order must have conclusively determined the disputed question;
2. the order must “resolve an issue completely separate from the merits of the action”;
3. the order must be “effectively unreviewable on appeal from a final judgment.”
Defendant also filed it wants the Appeal to stay, which was not wise as it is an undue influence and forces Sweeney when she stays(unwillingly) to also release an exact date on the stay.
“In addition, if it certifies the December 6 opinion, the Court should also stay further
proceedings pending the Federal Circuit’s resolution of our petition for interlocutory appeal and, if the petition is granted, the Federal Circuit’s decision on that appeal.”
28 U.S. Code §?1292.Interlocutory decisions
https://www.law.cornell.edu/uscode/text/28/1292
(3) Neither the application for nor the granting of an appeal under this subsection shall stay proceedings in the Court of International Trade or in the Court of Federal Claims, as the case may be, unless a stay is ordered by a judge of the Court of International Trade or of the Court of Federal Claims or by the United States Court of Appeals for the Federal Circuit or a judge of that court.
On Feb 20, 2020 Owl creek received an order: the parties stipulating to the effects of
this court’s motion-to-dismiss ruling in Fairholme on plaintiffs’ similar claims would facilitate a more expeditious ruling from the court in this case.2……………….the court requests that the parties file a joint status report “Thus, the court requests that the parties file a joint status report by no later than Tuesday, February 25, 2020, in which they state whether they would be willing to provide (or at least discuss with each other) such stipulations. If the parties are willing to consider such stipulations, they should either include thestipulations in their status report or propose a prompt deadline for filing another joint statusreport in which they will make their stipulations.3
2 This process is especially apt here given that the court considered plaintiffs’ arguments
when addressing similar issues in Fairholme. Fairholme Funds, Inc. v. United States, 146 Fed.
Cl. 17, 38 (2019) (“[T]he court infers that the plaintiffs in [Fairholme] have adopted the
favorable arguments made by the plaintiffs in the related cases to the extent such arguments are
relevant.”).
3 When proposing a deadline (if any), the parties should be cognizant of the fact that
briefing on whether to certify an interlocutory appeal in Fairholme is scheduled to finish by
March 4, 2020, and the court intends to rule promptly on any such motions in that case.
probably the other plaintiffs also received the same letter, she tells the granted missing/similar claims in fairholme can be added in a joint status report, Owl creek can add rescissory damages http://www.glenbradford.com/wp-content/uploads/2020/02/18-00281-0046.pdf
The following plaintiffs probably received the letter too :
List Of Fannie Mae and Freddie Mac Shareholder Suits Pending In The Court Of Federal Claims
1. Washington Federal v. United States, No. 13-385C (Fed. Cl.)
2. Fairholme Funds, Inc. v. United States, No. 13-465C (Fed. Cl.)
3. Cacciapalle v. United States, No. 13-466C (Fed. Cl.)
4. Fisher v. United States, No. 13-608C (Fed. Cl.)
5. Arrowood Indemn. Co. v. United States, No. 13-698C (Fed. Cl.)
6. Reid v. United States, No. 14-152C (Fed. Cl.)
7. Rafter v. United States, No. 14-740C (Fed. Cl.)
8. Owl Creek Asia I L.P. v. United States, No. 18-281C (Fed. Cl.)
9. Akanthos Opportunity Fund L.P. v. United States, No. 18-369C (Fed. Cl.)
10. Appaloosa Inv. L.P. v. United States, No. 18-370C (Fed. Cl.)
11. CSS LLC v. United States, No. 18-371C (Fed. Cl.).
12. Mason Capital L.P. v. United States, No. 18-529C (Fed. Cl.)
13. 683 Capital Partners, L.P. v. United States, No. 18-711C (Fed. Cl.)
14. Patt v. United States, No. 18-712C (Fed. Cl.)
15. Wazee Street Opportunities Fund IV LP v. United States, No. 18-1124 (Fed. Cl.)
16. Highfields Capital I LP v. United States, No. 18-1150C (Fed Cl.)
17. CRS Master Fund LP v. United States, No. 18-1155C (Fed. Cl.)
18. Perry Capital LLC v. United States, No. 18-1226C (Fed. Cl.)
19. Quinn Opportunities Master LP v. United States, No. 18-1240C (Fed. Cl.)
The NWS is illegal in its entirety, as the 5th circuit en banc ruled on it and was not appealed in scotus
claim in the 5th circuit was:
5 U.S.C. § 706(2)(C), (D), affords relief because FHFA exceeded its statutory conservator authority under 12 U.S.C. § 4617(b)(2)(D).
(2)hold unlawful and set aside agency action, findings, and conclusions found to be—
(C)in excess of statutory jurisdiction, authority, or limitations, or short of statutory right;
and is was granted (count I)
In their payer of relief they also ask the returned funds to be recharacterizing such payments as a pay down of the liquidation preference, but that is not possible as the SPSPA forbids that, so the full amount $ 159B needs to be returned to Fannie plus interest ones Judge Altas rules
Collins PRAYER FOR RELIEF
a. Declaring that the Net Worth Sweep, and its adoption, are not in accordance with and violate HERA within the meaning of 5 U.S.C. § 706(2)(C), that Treasury acted arbitrarily and capriciously within the meaning of 5 U.S.C. § 706(2)(A) by executing the Net Worth Sweep, and that FHFA’s structure violates the separation of powers; (=5 U.S. Code §?706 (2) hold unlawful and set aside agency action, findings, and conclusions found to be—(A)arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;(C)in excess of statutory jurisdiction, authority, or limitations, or short of statutory right)
b. 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;
c. Vacating and setting aside the Net Worth Sweep, including its provision sweeping all of the Companies’ net worth to Treasury every quarter;
d. Enjoining FHFA and its officers, employees, and agents from implementing, applying, or taking any action whatsoever pursuant to the Net Worth Sweep;
e. Enjoining Treasury and its officers, employees, and agents from implementing, applying, or taking any action whatsoever pursuant to the Net Worth Sweep;
https://www.courtlistener.com/recap/gov.uscourts.txsd.1391317/gov.uscourts.txsd.1391317.1.0.pdf
All actions happen simultaneously, the en banc declared § 4617(b)(2)(D and in SCOTUS Treasury is asking if 4617F prevents plaintiffs from bringing the argument, while in seila they both decided the for cause is unconstitutional
1) When Seila is decided, Collins questions are answered, “is for cause legal or illegal”, and can it be severed from in our case HERA, because plaintiff and defendant agree it to be unconstitutional the ruling will be accordingly so.
Because of the for cause removal, the independent nature in 4617 needs to go away, and count I(statuary breach) in Collins is solved too when it is decided by SCOTUS the first week of july-2020
2) On the 125B no particulars were mentioned and one can only guess what it stands for without any specifics, it can’t be allocated to particular part of paying or interest and what interest rate is applied
3) Yes all funds distributed to treasury under the NWS but only after a ruling on duress is finalized
4) because FnF never had the option to pay down the seniors any time they wanted the contract can only be established under duress / coercion and FnF could never voluntary agree to such an agreement, so the SPSPA is established under coercion and therefore not legal
5) Consent Decree is exactly the same as a Settlement, the first is inside the court and the second outside of the court
A consent decree is a negotiated agreement entered as a court order that is enforceable by the court.
A settlement agreement is an out-of-court resolution that requires a signed agreement, or memorandum of understanding, and performance by the defendant
https://www.justice.gov/opa/pr/justice-department-releases-memorandum-litigation-guidelines-civil-consent-decrees-and
FHFA does not want to proof the consent on the implied-in-fact contract and
Treasury hide behind the FHFA implied-in-fact contract that is unconstitutional according to discovery documents, so ones Seila is decided unconstitutional independent needs to be severed from HERA and 4617 independent becomes unconstitutional and the SPSPA becomes unconstitutional as it was entered into it by an unconstitutional agency that never had the power to enter into such a contract (beside that it is not legal because of the duress / coercion problem)
6) the bolded part means Fannie and Freddie will be capitalized either, due to a court order or thru a settlement or thru a consent decree
7) FHFA has no fiduciary duty towards shareholders meaning they do not have to take into account what the consequences are for shareholders on an individual action they do, however they do have fiduciary duty ones it comes to giving away 79.9% of the company, this is something what a normal BOD under no circumstance would do, FHFA is bounded by “normal” business practices and is not outside the law
8) TCCA fees are unconstitutional, although not challenged yet, congress cannot demand funds upon their wishes, congress will always have a budget problem and Fannie and Freddie will not be the solution to the problem, that is why I say will come back to the decision, if you want to make America great again you need to abandon the TCCA 2.0 fees and I still think the administration will do what is in the best interest for the country and that is not double taxing house owners
9) The critically capitalized rule is very hard to adjust, because it is established law and need to pass congress, as FHFA authority is questioned in court, he probably doesn’t want to upset the court even more, also with this turtle speed and problems FHFA has on hand, it is very unlikely they will establish a new critical capitalized rule, FHFA will probably only come with “adequate capitalized” rule as FHFA has full discretion upon it and the least of problems releasing only adequate, but still has complications as market participant all have more knowledge then the FHFA has in house, scenarios are certainly questioned and everybody will have his opinion ready, this rule will have problems enough of its own, as they cannot contradict themselves in previous opinions and scenarios
So I expect it to be more of the same, as otherwise serious adjustment to the Gfees need to take place too, which again will upset congress
10) it is the mission of the conservator to release a well-functioning company because of the preserve and conserve and putting in sound and solvent condition, it would be very strange if FHFA releases Fannie and Freddie and they are bleeding money and are not market conform and maximized in profits for its shareholders, then they would have breached their statuary mission
11) 12) 13) 14) FHFA beginning last year said it needed a year to fully set Fannie and Freddie free and run it like a private company again, so somehow it was run as a government agency, look to me as breach, but never the less, after conservatorship is over the authority of the FHFA is also over as Seila will decide we need to go back to the OFHEO regime
FHFA has no authority over the BOD ones fannie and freddie pass the critical capital level
FHFA has no authority what the form and or amount is fannie and Freddie need to raise it is upto the companies themselves as FHFA indicated, the only problem with that is FHFA did the opposite and now Fannie and Freddie need more capital because of the conservatorship
15) the CSP/CSS Debacle was forced upon Fannie and Fredie because the government wanted
more participants in the MBS market so a platform was invented costing $2B initially and now annually $121 million for fannie alone, but for the foreseeable future there will be no new participants as the total cost to operate will be too high for the new participant to bear, as the company who wants to enter needs to operate nationwide, not only California.
Now a conservator who demands stuff that is now outdated will be put responsible for it, and because of the lack of new participants, Fannie and Freddie need compensation for the outdated money consuming machine which soon will cost significantly more money than $121M, So it will be part of the discussion Fannie and Freddie and the FHFA will have in or out of court, as one of the first questions in the next the shareholder meeting will be, who pays for the CSP and can the CSS be dissolved and merged into Fannie and Freddie
18) a junior to common conversion is not cheaper nor more expensive what is gained on the pref side is lost on the common side, and shareholders are in fight with FHFA and Treasury and not with Fannie and Freddie, all cost that Fannie and Freddie need to pay their shareholders will be on the account of settlement, as common and prefs do not want to pay for the abuse themselves
19) Angel accused the BOD they did not declare dividends while it is their obligation to do so, no matter if or what amount or never it is their duty to declare this ona quarterly basis, this fact will expose why only the government received dividends, and common and pref did not, this is breaching duty of candor the BOD has, and FHFA failed in conservatorship to instruct the BOD to declare the dividend, as maybe the pref were on hold but the declaring of 100% of profit to the government on a quarterly basis is something the BOD should have prevented or informed the shareholders about back in 2012, another problem is the lawsuit is against Freddie mac, while the cause of the breach is a lack of responsibility of FHFA
21) FHFA being "declared an executive agency" means it needs to be included in the appropriations act, “non-independent” agencies receive funds from the government, so FHFA no longer receives funds from Fannie and Freddie and will cease payments to FHFA and HERA 12 U.S. Code §?4516.Funding can be declared void too
If FHFA and Treasury voluntarily unwind the NWS or amend the NWS they are obstructing the law as the 5th circuit already ruled it to be unconstitutional, so before a final SCOTUS opinion it can’t be voluntary dismissed by Treasury
All parties indeed have intent to settle only the NWS is already ruled illegal, so damages flow out of that ruling and certainly they can’t take any action themselves toward the NWS
Indeed the NWS action will cost treasury hundreds of billions of dollars because of the law: A contract may be deemed void should the terms require one or both parties to participate in an illegal act (the government says this in 6.7 & 6.12 of the SPSPA https://www.investopedia.com/terms/v/voidable-contract.asp
Fannie and Freddie as long as they are a shareholder owned company always had implicit guaranty, they never had explicit guaranty, so to claim it suddenly is necessary, is void ab initio, as the SPSPA itself is
The Collins Lawsuits
No it can’t be appealed ones Seila is decided, the 5th circuit en banc decided the NWS was a statutory violation (count I) and the “for cause” removal was unconstitutional(count IV) , and remanded it back to Judge Atlas
When the 5th was decided Collins, plaintifs filed a writ of certiorari "to be more fully informed." In the SCOTUS were they ask on count IV if it indeed is unconstitutional, and on count IV if backward relief should be given(on the statutory violations):
1. Whether FHFA’s structure violates the
separation of powers; and
2. Whether the courts must set aside a final agency
action that FHFA took when it was unconstitutionally
structured and strike down the statutory provisions
that make FHFA independent.
And Treasury also “surprisingly”(see below) filed a writ of certiorari “to be more fully informed” were they ask on count I
1. Whether the statute’s anti-injunction clause,
which precludes courts from taking any action that
would “restrain or affect the exercise of powers or functions
of the Agency as a conservator,” 12 U.S.C. 4617(f ),
precludes a federal court from setting aside the Third Amendment.
2. Whether the statute’s succession clause—under
which FHFA, as conservator, inherits the shareholders’
rights to bring derivative actions on behalf of the
enterprises—precludes the shareholders from challenging the Third Amendment.
What the Collins plaintiffs ask for is “for cause” removal legal and should backward looking relief be applied to the case, so even though the 5th circuit en Banc already ruled it was illegal they want certainty or “be more informed” and want to make sure when atlas rules that the backward looking relief is not forgotten or neglected, defendant on the other hand is asking if 4617(F)(count I)(see below) is legal which already is ruled illegal by the 5th circuit because the “for cause” removal violates the separation of powers(count IV)
the separation of power system has 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.
So 1) 4617(F) prevents 2) and 3), so 4617(F) is unconstitutional, the case in front of the SCOTUS was supposed to proceed the beginning of this year, but a lawsuit with the same question as Collins is also pending in SCOTUS under the CFPB Seila lawsuit, so the Collins case is waiting on resolution in Seila
and because count IV is unconstitutional, Count I is also unconstitutional as you can not claim in Law(HERA) that forbids judical power in 3
On Jun 28 2019 Seila filed a writ of certiorari “to be more fully informed”
https://www.scotusblog.com/case-files/cases/seila-law-llc-v-consumer-financial-protection-bureau/
Seila is asking the SCOTUS:
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.
Then the SCOTUS added a second question:
can for cause be severed from Dodd-Frank Act
Plaintiff and the government AGREE on the first question,
but disagree on the second question
Plaintiffs 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.
It is Set for argument on Tuesday, March 3, 2020. Decision in the last 2 weeks of June -2020
So to understand the “surprisingly” fact between Seila and Collins ,
THE GOVERNMENT AGREES WITH PLAINTIFFS THAT THE “FOR CAUSE” VIOLATES THE SEPARATION OF POWER, while they in our case have asked if they have power under 4617(F) they already agreed in Seila they do not have the power, So because they agree in Seila “for cause” violated the separation of power, they must now know 4617(F) “No provision of law shall limit the power of the Agency” is unconstitutional as well, because it is a separation of power problem due to the 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.
So ones Seila is decided in favor of plaintiffs(no other possibility possible) because it is the wish of both parties, the FHFA also becomes unconstitutional and independent needs to be detached from HERA, but not only the “independent” also ALL lines that give power to independent, but also the lines that give direct power to the director, and the lines that have direct power because of the independent power the director has, and the lines that give power to the act or paragraph because other regulation or constitutional law has power that conflict the power of the independent director
And lines that now(because of the removal) become meaningless/ powerless/ without merit
12 U.S.C. 4617(f ), (F)Clarification
No provision of law shall be construed as limiting the right or power of the Agency, or authorizing any court or agency to limit or delay in any manner, the right or power of the Agency to transfer any qualified financial contract in accordance with paragraphs (9)(see below) and (10)(see below), or to disaffirm or repudiate any such contract in accordance with subsection (d)(1).(see below)
https://www.law.cornell.edu/uscode/text/12/4617
Paragraph (9)POWERS OF LIMITED-LIFE REGULATED ENTITIES
(A)In generalEach limited-life regulated entity created under this subsection shall have all corporate powers of, and be subject to the same provisions of law as, the regulated entity in default or in danger of default to which it relates, except that—
(i)the Agency may—
(I) remove the directors of a limited-life regulated entity;
(II) fix the compensation of members of the board of directors and senior management, as determined by the Agency in its discretion, of a limited-life regulated entity; and
(III) indemnify the representatives for purposes of paragraph (1)(B), and the directors, officers, employees, and agents of a limited-life regulated entity on such terms as the Agency determines to be appropriate; and
(ii)the board of directors of a limited-life regulated entity—
(I)shall elect a chairperson who may also serve in the position of chief executive officer, except that such person shall not serve either as chairperson or as chief executive officer without the prior approval of the Agency; and
(II) may appoint a chief executive officer who is not also the chairperson, except that such person shall not serve as chief executive officer without the prior approval of the Agency.
(B)Stay of judicial action
Any judicial action to which a limited-life regulated entity becomes a party by virtue of its acquisition of any assets or assumption of any liabilities of a regulated entity in default shall be stayed from further proceedings for a period of not longer than 45 days, at the request of the limited-life regulated entity. Such period may be modified upon the consent of all parties.
https://www.law.cornell.edu/uscode/text/12/4617
(10)NO FEDERAL STATUS
(A)Agency status
A limited-life regulated entity is not an agency, establishment, or instrumentality of the United States.
(B)Employee statusRepresentatives for purposes of paragraph (1)(B), interim directors, directors, officers, employees, or agents of a limited-life regulated entity are not, solely by virtue of service in any such capacity, officers or employees of the United States. Any employee of the Agency or of any Federal instrumentality who serves at the request of the Agency as a representative for purposes of paragraph (1)(B), interim director, director, officer, employee, or agent of a limited-life regulated entity shall not—
(i) solely by virtue of service in any such capacity lose any existing status as an officer or employee of the United States for purposes of title 5 or any other provision of law; or
(ii)receive any salary or benefits for service in any such capacity with respect to a limited-life regulated entity in addition to such salary or benefits as are obtained through employment with the Agency or such Federal instrumentality.
(D)Powers as conservatorThe Agency may, as conservator, take such action as may be—
(i)necessary to put the regulated entity in a sound and solvent condition; and
https://www.law.cornell.edu/uscode/text/12/4617
(d)PROVISIONS RELATING TO CONTRACTS ENTERED INTO BEFORE APPOINTMENT OF CONSERVATOR OR RECEIVER
(1)AUTHORITY TO REPUDIATE CONTRACTSIn addition to any other rights a conservator or receiver may have, the conservator or receiver for any regulated entity may disaffirm or repudiate any contract or lease—
https://www.law.cornell.edu/uscode/text/12/4617
I love to hear from the SCOTUS, bring it on
Treasury has ZERO reason to release the implied-in-fact contract as it according to their saying will disrupt the market after 12 years of conservatorship
the prayer for relief are constitutional claims, there is a price for coercion, what plaintiff will agree on is just a matter of what they will get back for it
I lost you on the junior to common conversion, so in settlement prefs receive conversion but the same lawsuit also has common holders, so those holders will agree in settlement to give prefs conversion and don’t want anything back for their dilution, I don’t get your line of thinking, please explain in an example settlement like for instance fairholme with common and pref holders
The prefs automaticly trade at par ones the commons are relisted, it is always costless to FnF
Yes Sweeney can instantly dismiss Washington federal, I love to see the un-redacted Washington federal files, she has my blessing
When Sweeney ends the argument of coerced, she declares it was not coercion and the documents are released to the public, something the government is trying hide for 12 years now, so my guess is she probably will not release them and not end the argument and the cases be settled so she doesn’t have to release them herself in a ruling.
The documents need to be released because of Duress coercion accusations the common and pref holders of the private company made, so in order for the government to keep their position they need to proof by contract they are entitled to, because we say so is of course not something legal, but the documents are, and Sweeney has seen them and the government doesn’t want to show them
FnF entered into an implied-in-fact contract with FHFA, if this contract was NOT established under duress / coercion the SPSPA is legal, if however the implied-in-fact contract was established under duress the SPSPA is void ab initio
(when the implied-in-fact contract is declared legal we still must hear the reason why the BOD gave away 79.9% of the company without any return and why they breached their duty of candor)
HERA is written in a very unprofessional way, let me tell you why, when you take a look at HERA, it is implemented in several individual laws/statutes, besides a company as large as FnF are, cannot be controlled by a single director out of transparency reasons, HERA says hundreds of times when the director declares or at will of the director, this gives this director more power than the president, what it actually should have said was “when the director declares BY LAW OR REGULATION….” But the demands are way to frivolous to put BY LAW behind every sentence because the things they want are not in the law, a single director cannot declare wishfull thinking or invent regulation that was not passed by congress.
institutions as large as FnF and only can regulated by law not by a single director personal wishes, I understand OFHEO did not have enough power and they wanted more power, but this is just not the way, and HERA for me is unconstitutional when the first page starts I would encourage you to read it yourself, if you do, start reading at : SEC. 1001. SHORT TITLE.
https://www.congress.gov/110/plaws/publ289/PLAW-110publ289.pdf
(also search for 1106 )
you will find :
‘‘(i) the regulated entity is not likely to be able
to pay the obligations of the regulated entity in the
normal course of business; or
‘‘(I) has incurred or is likely to incur losses
that will deplete all or substantially all of its capital
‘‘(II) there is no reasonable prospect that the
capital of the regulated entity will be replenished.’
This of course is as far away from the constitution as you can go because 4613 in https://www.law.cornell.edu/uscode/text/12/4613 already says what the critical level should be, so the director cannot by himself declare what the reasonable prospect is, it is law that he needs to be followed and why SCOTUS has asked is it severable, well it can not, lines like likely or reasonable are determined in 4613, so when for cause is removed(Collins) it becomes an executive agency that needs to obey FHA, and all single director wishes need to be deleted from HERA as FHA only by law can regulate the entities not by reasonable prospect the single director has
The critical capitalization is declared in 4613 it is 1.25 so no matter what the new “adequate capitalization” rule is, ones they pass the 1.25 ($43B) the conservatorship is over as it no longer is required to be under conservatorship
haven’t got the slidest idea either, sorry
Decided according to David Thompson 1 week after resolution in Seila Law, abd that will be ~first week of july-2020
see post 593547 (it was the same question)
So far we are only at the motion to dismiss stage, when the SCOTUS rules it is the END there is no further appeal possible for the government, and our cases will be fast forwarded
When the NWS is declared illegal by judge atlas as the 5th circuit demanded when it remanded it back, ones she re-rules it to be illegal ALL funds need to be returned not only the 10%, then the contract is adjusted and will be voided as A contract may be deemed void should the terms require one or both parties to participate in an illegal act as the government also says in 6.7 & 6.12 of the contract https://www.investopedia.com/terms/v/voidable-contract.asp
all actions will take place simultaneously this year the time of delaying is over as the pressure is too high to not settle
The 5th circuit “little as possible” will not be setting law aside because it is too much work, whatever is necessary to straighten out the misbehavior needs to happen no matter how much needs to be changed, when unconstitutional it needs to be removed from law, in this case A lot
HERA 80% illegal could be erroneous maybe it is 70% or 90% I’m working on the list but it is never ending so it could take a while never the less it is HUGE!
The SPSPA is not voidable by treasury only because there was no consent, ones consent is declared in Washington Federal and Fairholme we have consent and treasury can only, but until then it cannot
The prayers for relief need to satisfied by money and undoing the unconstitutional, this could not be a direct relief of the prayer of relief but indirectly will solve the problems FHFA established without saying they did so and cures plaintiff demands
Rafter(PERSHING SQUARE) voluntary filed for Notice of Voluntary Dismissal this is not copycat, this is supersmart, read into it
Near the finish line it is more expensive for FHFA than in the beginning
Junior to common conversion cannot happen, it will be on the cost of common and the 2008-1 pref series, regular prefs will not receive double recovery nor will commons receive double recovery, nor will pref benefit at the cost of commons nor will commons benefit at the cost of prefs, so no a conversion is not going to happen and is not an alternate solution (the 2008-1 pref series will convert to common the others not)
By converting ones relisted you void your rights on missed dividends and punitive damages and you might be of worse
Washington federal in several points point out the conservatorship was not legal by rules the government established themselves https://www.law.cornell.edu/uscode/text/12/4613 so ones they receive money for it’s demands it is proven they acted beyond 4613 thus was illegal so remedy will follow for FnF so for pref and commons in FnF’s net worth so in pref and common price
Because the government does not want to proof the consent in the implied-in-fact contract, the SPSPA and conservatorship are not legal, it is only legal ones those document are released, and the old BOD tells the public why they needed to give away 79.9% of the company without any investment and why they breached their duty of candor
but for now they cannot release the documents because it would upset the market, logically because coercion/duress is not legal, and indeed would upset the market if the government can obtain a company by Duress
No Plaintiffs forbid FHFA and Treasury to take any action towards the NWS as the court needs to decide the NWS is illegal
Then the NWS needs to be modified upon court order and since Treasury voluntary wants to void the SPSPA when he court modifies the SPSPA in any form (6.7 & 6.12)
The short situation is always incomplete so you can never tell if it is positive or negative, in options you have calls(long) and puts(short), so one can’t go without the other, so if you have a 20 open interest on a short it is important to know if you have 40 open interest on the call side because the 20 short would be a very positive sign if you have 40 longs, anyway to make a long story short,
the short interest cannot be viewed without the long interest to understand the situation, and no retail investor is able to short FnF as there are no series listed on the pink sheets, but back to what I see
IMO the oncoming 6 months I see
1) Seila decided unconstitutional and backward relief in our case
2) the 125B Sweeney talked about is now 131.2B and will be ~140B by time we have a decision in Seila,
3) the Treasury voluntary(thru consent decree) or upon court order will return all funds distributed toward the net worth sweep, so the liquidation preference will be declared paid in full
4) advisor from FHFA will make a public statement the SPSPA fulfilled, the liquidation preference was declared paid by the courts so all obligations towards treasury are fulfilled, (that way nobody has any blame in wrongdoing and the warrant can’t become a public debated ussue)
5) FHFA will settle(consent decree) with plaintiff over “other damages like fiduciary duty, punitive damages etc” this amount will be paid and in the 3th quarter and they will be declared capitalized, and the SPSPA contract will be declared fulfilled (because of the Breach of Implied-in-Fact Contract)
6) the conservatorship will end Oct 1, 2020, because they passes legal critical capital level of $42B https://www.law.cornell.edu/uscode/text/12/4613 due to court orders settlement(consent decree)
7) there will be no secondary offering(if adequate capital is higher than $200B yet to be released) on prefs or common before they are relisted on the NYSE as that would breach FHFA’s fiduciary duty again
8) the current administration will come to the conclusion TCCA 2.0 fees are not the way to go, and abandon them, they will restart H.R.916 — 115th Congress, because they want to make the system better not worse, and prevent future abuse by other administrations,
9) next month we will see how much is needed as new total capital for “Adequately Capitalized” under 12 U.S. Code §?4614(1)(A), the critical is 1.25% (now 42B) and a minimum of 2.5% (now 84B) but those will stay the same (in 2008 they only needed 16B in critical and 32B as minimum while they had $45B when FHFA took over, and FHFA made a DTA provision of $37B so the core capital became $-8,641)
The higher the Adequate capital demand however the higher the Gfees will become.
10) Also this year I expect the ROE to increase substantially from 3.17 to at least 20 https://www.gurufocus.com/term/ROE/OTCPK:FNMA/ROE-/Fannie-Mae
11) a shareholder meeting will be set
12) Shareholders elect a new BOD and the BOD installs new CEO’s
13) a date for relisting on the NYSE is released they will keep the FNMA ticker,
14) the new BOD will come early next year with a restoring plan, so the money leaking can stop
15) also in a settlement we will see what compensation we will receive for the CSP/CSS debacle, and what the operational costs are of the platform, and if compensation is enough for FnF to continue to operate the platform FOR the government (probably for Fannie $1B in settlement and $122M for 2020 & annually )
16) an increase in Gfees or a decrease in spending and more specifics to on their spending
17) because of the caps in multifamily recently announced I expect an increase in Gfee multifamily of ~4 basis points
18) missed pref dividend will be paid in settlement and reinstated and because of that they will trade at par and thru new pref offerings they will buy back the old prefs in the oncoming years
19) common missed dividends(20.1%) will be paid in settlement (because of the angel lawsuit) and new quarterly dividends of $0.075 will be declared
20) a $1.1B provision for the CECL,
21) and an Decrease in the 1st Quarter spending of the “Administrative expenses” of $40M due to FHFA declared an executive agency and FnF no longer have to pay the agency for their operation expenses, plus a reimbursement to FnF of $5.25B (3.5B transferred) from FHFA that it unlawfully used to operate their agency the last decade
The 5th circuit by changing “for cause” it changed the agency to an executive agency, the “good enough” as you claim has severe implications as 80% of HERA needs to be changed and since it is an executive agency it must obey FHA and since FHA is without any doubt the government it cannot act independently or at the wishes of a single director who in HERA has unlimited power
The SPSPA only contains words and is a Voidable Contract by design https://www.investopedia.com/terms/v/voidable-contract.asp
The bigger picture is solving all of the lawsuits so FnF can operate without FHFA as conservator, so logically if you want to settle you need to fulfill all prayers of relief not only Collins, it is a 30 point list which you probably have seen and it ain’t pretty, and since it took this long and even if they fulfill ALL demands with interest etc and everybody goes back to work, Rafter will come back with a new set of unfinished business, so it ain’t pretty for the government, because it ain’t cricket
Mark and Steve thought they would get out of this mess easily, boy were they mistaken, the misconduct is just too big
Amending the SPSPA is just not possible Mark might think it satisfies most plaintiffs but be assured it will not, the causes are just before the finish and maybe several years ago they wanted to settle for less, but just before the finish they will not, and now they want full relief, the total cost of this situation will be the least of the problem they have
Junior to common conversion is not what the pref plaintiff ask for, nor would it solve anything in the litigations going on, why would a unconstitutional FHFA convert prefs to common and allow commons to pay for it while the single lawsuit plaintiffs contains both commons and prefs, what will be the relief to common for the relief for pref, totally unlogical
A SPO can only happen ones all litigation (except Rafter of course) is ruled on, and how many hundreds of billions they will receive back for the misbehavior, investors just don’t like uncertainty
You sure have good faith in the Warrant, as everybody had in the 3th amendment, it was a super duper idea, they even received compliments from their bosses for such a great idea, only they forgot the constitution and law prevented excessive abuse by the people and by the government for 99%, I’m just flabbergasted by the ignorance the previous administrations had, how could the forces be that strong against 2 companies that they were willing bet everything against it, the constitution, the law, and most importantly lose-face, conservatorship is a status to help distressed companies back on their feet, because if the company goes down the ordinary people go down with it, so coming back to the warrant, it was a second demand in a loan contract and the company did not receive any additional funds for it, this is of course not possible by logical reason why would a company voluntary give away anything without return, in the doubtful voluntary takeover the BOD would never ever EVER ever permitted to give away 79.9% of the company, this violates their duty of candor and is not something that could happen without coercion, so the warrant is not legal and a no go, maybe legal on paper because the SPSPA says so, but the circumstances under which the BOD would voluntary give up 79.9% of the company are not present, so it lacks consent and therefore it is illegal
An amendment to the NWS is not possible because plaintiff explicitly Demand not to do that, and the 5th circuit already ruled it was 5 U.S.C. § 706(2)(C), (D) https://www.law.cornell.edu/uscode/text/5/706 so until there is resolution by court they can’t amend it, if they however decide to do it anyway and the court rules in favor of plaintiffs it cannot be undone, but see it from the positive side it is already ruled illegal
You mix things up, if Seila is declared unconstitutional due to the “for cause” removal the independent transforms to an executive agency
And FHFA also becomes unconstitutional and an executive agency then that part of HERA(witch says independent) is also unconstitutional, and defendant already said it is unconstitutional so it cannot be declared constitutional, then the unconstitutional needs to be removed from HERA, and as most of HERA says “the DIRECTOR does and determines” al sort of things, a lot of things need to be deleted from HERA, that begs the question does HERA live after so much has been deleted, that is why the supreme court asked can it be servered, well yes it can, if you delete 80%
Why would the SPSPA not end ones the funds are returned by court order, who empowered that the unconstitutional FHFA ?
Amending the SPSPA is not possible as several plaintiff demand that, and defendant want to void the contract if they do, so yes it is not possible to amend the SPSPA
A Junior to common conversion cannot happen by law in the lawsuits pending when commons need to pay for it
They are not retaining earning, every dollar they retain is a buildup of dept to treasury
When 2 branches of the government (soon decided in Seila) enter into a contract that is in conflict with a for profit company and prevent them from normal operating, the 2 branches entered into a self-dealing contract
an SPO can not happen because the governement siphoned-off all profits, ones those are returned with interest and they still need money, then they can SPO but not before all funds are returned
Why would the warrant be legal? I do not see 1 single reason why it would be legal, you tell me the legal basis beyond the writing it says so
The congress kick the can down the road is ending as there is no road left to kick to can to
All good thing come to an end and the lawsuit are near completion and soon will be decided what needs to be done, do nothing is not possible ones the court has ruled
Relief cannot be denied because of the constitution, either trash the constitution or trash conservatorship, I’ll bet it is not the constitution
Remedy in Fannie Mae and Freddie Mac lawsuits:
Elaborating on remedy, what we have seen so far is that Sweeney will go for the Derivative and Atlas and Lamberth for the Direct claims, if you put the claims into a blender you will come up with:
1) A Taking
2) Unconstitutional
3) A Breach
1) The taking is NOT a solvable issue as the government indicated it wants to exit conservatorship and does not want to take Fannie’s 3.8T on their balance sheet, so relief will be for money only
2) The unconstitutional is solvable and parties claim the actions taken sofar are not according to statue or conflict law or conflict the constitution as HERA does, so to solve this, the conflict needs a remedy
5 U.S.C. § 706(2)(C) FHFA acted in excess of statutory jurisdiction, authority, or limitations, or short of statutory right
5 U.S.C. § 706(2)(A) Treasury Acted arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law
12 U.S.C. § 4511(a) There is established the Federal Housing Finance Agency, which shall be an independent agency of the Federal Government.
12 U.S.C. § 4512(b)(2) The Director shall be appointed for a term of 5 years, unless removed before the end of such term for cause by the President.
12 U.S.C. § 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.
12 U.S.C. § 4617(f) Clarification
No provision of law shall be construed as limiting the right or power of the Agency, or authorizing any court or agency to limit or delay in any manner, the right or power of the Agency to transfer any qualified financial contract in accordance with paragraphs (9) and (10), or to disaffirm or repudiate any such contract in accordance with subsection (d)(1).
Are the terms they use as defence
“the non-delegation doctrine stands for the general proposition that Congress cannot delegate the power to legislate to anyone else, specifically the executive branch. The doctrine is derived from Article I of the Constitution, which says that, “All legislative powers herein granted shall be vested in a Congress of the United States. . . .”
The framers of the Constitution separated the powers of government into three branches, granting
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.
So without any doubt FHFA and HERA are unconstitutional (as the government admits in Seila’s lawsuit), as congress cannot pass law that forbids judicial power to the court and an independent Agency that forbids executive power to the president
3) The Breach is solvable by undoing the breach or pay damages that occurred because of the breaches
Then as a next step (in Seila), Can the unconstitutional be severed from HERA? IMO not, HERA is written in a way that breaths unprecedented power plus the reason for HERA itself is being undone, and we basically go back to the OFHEO regime
For instance amongst dozens of others these blatant unconstitutional rules were implemented:
https://www.congress.gov/110/plaws/publ289/PLAW-110publ289.pdf
SEC. 1002. DEFINITIONS.
‘‘(8) DEFAULT; IN DANGER OF DEFAULT.— (12 U.S. Code §?4502)
‘‘(A) DEFAULT.—The term ‘default’ means, with respect
to a regulated entity, any adjudication or other official
determination by any court of competent jurisdiction, or
the Agency, pursuant to which a conservator, receiver,
limited-life regulated entity, or legal custodian is appointed
for a regulated entity.
Violates: §?4613(a) : §?4614(a)(1)
‘‘(B) IN DANGER OF DEFAULT.—The term ‘in danger
of default’ means a regulated entity with respect to which,
in the opinion of the Agency—(meaning FHFA)
‘‘(i) the regulated entity is not likely to be able
to pay the obligations of the regulated entity in the
normal course of business; or
‘‘(ii) the regulated entity—
‘‘(I) has incurred or is likely to incur losses
that will deplete all or substantially all of its capital;
and
‘‘(II) there is no reasonable prospect that the
capital of the regulated entity will be replenished.’’;
Violates:§?4613(a) : §?4614(a)(1)
Then when Seila is finalized, it leaves us with an unconstitutional agency (as both plaintiff and
Defendant demand) and backward looking relief or not, and then back to the FnF case can an unconstitutional agency do unconstitutional things(actions) and get away with it?
And more importantly can this agency do unconstitutional things and not “undo” them?
Then to the Breach allegations, if an agency is unconstitutional(Seila), can an Agency operate outside their framework that was ruled unconstitutional, while the actions itself are unconstitutional too (conservatorship coercion etc) and the supporting regulation in HERA’s to place FnF in conservatorship(§?4502(8)(a)(b)) are unconstitutional too
But back to the Remedy:
1) Keep the SPSPA in place and not declare Rescission or Completion (not possible according to the demanded relief)
The SPSPA contract is a temporary contract by design, ones the funds are returned it will end, the contract nowhere indicated it is an everlasting contract or supersedes law or is an addition to the temporary control FHFA can take
2) Amend the 3th amendment (NWS) (not possible according to the demanded relief)
The demands by plaintiff “forbid” to take any action toward the NWS and “a. Declaring that the Net Worth Sweep, and its adoption, are not in accordance with and violate HERA within the meaning of 5 U.S.C. § 706(2)(A) & (C)
3) Convert Pref to Common (not possible according to the demanded relief)
The lawsuits are Common AND Pref lawsuits, you cannot relief the pref while charging the commons, it would solve nothing, the dissatisfaction is against the FHFA and Treasury not toward the Common, Fannie indirect paying prefs to solve 1 problem while FHFA and treasury caused it would only make the problem bigger and cannot be seen as relief to anyone as the pref holder would then be exposed to the same misbehavior that caused the whole problem, and that is also why no pref lawsuit is asking for it
4) Retain Earnings to Re-Capitalize (not possible according to the demanded relief)
FHFA has taken over FnF to put them in sound and solvent condition by LAW, this is not siphoning off all profits, to retain earnings would be agreeing they were allowed to siphon-off the profits
5) Keep the SPSPA as secondary form of regulation (not possible according to the demanded relief)
The Government(Treasury) entered into a contract with the government(FHFA) this is not law nor controllable,(the non-delegation doctrine issue) self-dealing contracts by the government cannot be law unless the court have power over them, but HERA forbids that, so either it is law or not, but not a SPSPA contract that has wishes beyond/outside the law
6) Issue a SPO to Re-Capitalize (not possible according to the demanded relief)
FHFA has taken over FnF to put them in sound and solvent condition, but what they did was the opposite of that, so first all the funds transferred need to be returned with interest you cannot SPO while you have done the opposite of what is expected, this will upset investors because it could happen to them too
7) Execute the 79.9% warrant (not possible according to the demanded relief)
The Government entered FnF in a non-legal “implied-in-fact” contract, at least the government does NOT want to proof it entered legally(sealed redacted BOD documents), so the ruling on it can only be in plaintiff favor, otherwise the document needs to be unsealed so the implied-in-fact contract can only be void ab initio
then they entered into the SPSPA, this contract by itself is self–dealing and only has one thing in mind and that is put it six feet under in dept, while they did not supply any additional funds that would support the 79.9% ownership and the modification to the 3th amendment will modify/alter the SPSPA and because of that, the government wants to void it as they say in 6.7 & 6.12 of the SPSPA
8) Do nothing (not possible according to the demanded relief)
The lawsuits will come to conclusion
Summary of the “PRAYER FOR RELIEF” in Fannie Mae and Freddie Mac lawsuits
In order of appearance plaintiffs allege below mentioned prayers for relief in the misconduct FHFA / Treasury used to siphon off all profits of FnF in perpetually
Remedy:
1) Keep the SPSPA in place and not declare Rescission or Completion (not possible according to the demanded relief below)
2) Amend the 3th amendment (NWS) (not possible according to the demanded relief below)
3) Convert Pref to Common (not possible according to the demanded relief below)
4) Retain Earnings to Re-Capitalize (not possible according to the demanded relief below)
5) Keep the SPSPA as secondary form of regulation (not possible according to the demanded relief below)
6) Issue a SPO to Re-Capitalize (not possible according to the demanded relief below)
7) Execute the 79.9% warrant (not possible according to the demanded relief below)
8) Do nothing (not possible according to the demanded relief below)
Direct claims in SCOTUS/Atlas and Lamberth’s court:
1) Treasury acted arbitrarily and capriciously …………………….… Common & Preferred
2) FHFA structure violates the separation of powers …………………….… Common & Preferred
3) return to FnF all dividend payments made to the Net Worth Sweep .. Common & Preferred
4) FHFA is unconstitutional when insulated from congressional and judicial review …… Common & Preferred
5) FHFA’s conservatorship powers violate the non-delegation doctrine … Common & Preferred
6) acting director Edward DeMarco’s tenure was unconstitutionally long .Common & Preferred
7) breaches of contract …………………….… Common & Preferred
8) breaches of the implied covenant of good faith and fair dealing …… Common & Preferred
9) breaches of fiduciary duties …………………….… Common & Preferred
10) violations of Delaware and Virginia law governing dividends …… Common & Preferred
11) FHFA may no longer operate as an independent agency ….… Common & Preferred
12) striking down the provisions HERA 12 U.S.C. §§ 4511(a), 4512(b)(2), and 4617(a)(7) …… Common & Preferred
13) Freddie breached the terms of the Certificates of Designation ……………. Preferred
14) Freddie breached the implied covenant of good faith and fair dealing ……………. Preferred
15) breach of Plaintiff's contractual rights for dividends, with interest thereon from the respective missed dividend payment dates ……………. Preferred
16) compensatory damages in favor of Plaintiff for Aiding and Abetting the Federal Government in avoiding payment on the Junior Preferred dividends, with interest ……………. Preferred
17) breach of fiduciary duty by FHFA, Fannie, and Freddie ……………. Preferred
18) Awarding Plaintiffs damages and injunctive relief resulting from the restructuring of dividends ……………. Preferred
Derivative Claims in Sweeney’s Court:
19) FHFA illegally exacted Plaintiffs’ property, and has breached the express and implied terms of Plaintiffs’ contracts defendant has taken Plaintiffs’ property without just compensation …………… Common
20) and awarding to Plaintiffs and the Classes the just compensation and/or damages sustained by them as a result of the violations set forth above …………… Common
21) ordering restitution and reformation as appropriate to ensure full compensation to Fannie Mae and the Fannie Common Class for damages suffered from the Third Amendment …………… Common
22) Awarding Plaintiffs prejudgment interest on any damages or just compensation …………… Common
23) Third Amendment is held to have been entered into in violation of HERA or the Constitution …………… Common
24) Fannie Mae is entitled to reformation of the underlying PSPA to invalidate and excise the Third Amendment. …………… Common
25) Awarding Plaintiffs pre-judgment and post-judgment interest …………… Common
26) Awarding rescissory damages, based upon the breach of fiduciary duty that occurred ……………………………. Common & Preferred
27) Awarding Plaintiffs damages for the Government’s illegal exaction of their stock ……………………………. Common & Preferred
28) Awarding Fannie and Freddie damages for the Government’s illegal exaction of their net worth ………….. Common & Preferred
29) Awarding Fannie and Freddie damages for the Government’s illegal exaction of their net worth ………….. Common & Preferred
30) awarding Plaintiffs damages suffered in the amount of $41 billion ………….. Common & Preferred
16-3113 (17-20364) Collins v. Lew …………………….… Common & Preferred
PRAYER FOR RELIEF
a. Declaring that the Net Worth Sweep, and its adoption, are not in accordance with and violate HERA within the meaning of 5 U.S.C. § 706(2)(C), that Treasury acted arbitrarily and capriciously within the meaning of 5 U.S.C. § 706(2)(A) by executing the Net Worth Sweep, and that FHFA’s structure violates the separation of powers; (=5 U.S. Code §?706 (2) hold unlawful and set aside agency action, findings, and conclusions found to be—(A)arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;(C)in excess of statutory jurisdiction, authority, or limitations, or short of statutory right)
b. 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;
c. Vacating and setting aside the Net Worth Sweep, including its provision sweeping all of the Companies’ net worth to Treasury every quarter;
d. Enjoining FHFA and its officers, employees, and agents from implementing, applying, or taking any action whatsoever pursuant to the Net Worth Sweep;
e. Enjoining Treasury and its officers, employees, and agents from implementing, applying, or taking any action whatsoever pursuant to the Net Worth Sweep;
https://www.courtlistener.com/recap/gov.uscourts.txsd.1391317/gov.uscourts.txsd.1391317.1.0.pdf
18-2506 (17-2185) Bhatti vs. FHFA …………… Common & Preferred
PRAYER FOR RELIEF
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);
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.
https://gselinks.com/Court_Filings/Bhatti/17-cv-02185-0027.pdf
“the non-delegation doctrine stands for the general proposition that Congress cannot delegate the power to legislate to anyone else, specifically the executive branch. The doctrine is derived from Article I of the Constitution, which says that, “All legislative powers herein granted shall be vested in a Congress of the United States. . . .”
13-1288 Miscellaneous Class Action … Common & Preferred
PRAYER FOR RELIEF
1) Awarding Plaintiffs and the Classes the amount of damages they sustained
as a result of Defendants’ 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
https://www.courtlistener.com/recap/gov.uscourts.dcd.163155/gov.uscourts.dcd.163155.71.0.pdf
17-497 Rop v. Federal Housing Finance agency ……. Common & Preferred
PRAYER FOR RELIEF
a. Vacating and setting aside the third amendment to the PSPAs, including
its provision sweeping all of the Companies’ net worth to Treasury every quarter;
b. Enjoining Defendants and their officers, employees, and agents from
implementing, applying, or taking any action whatsoever pursuant to the third
amendment to the PSPAs, including its provision sweeping all of the Companies’ net
worth to Treasury every quarter;
c. 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;
d. 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), and 4617(a)(7)
https://gselinks.com/Court_Filings/Rop/17-cv-00497-0001.pdf
18-3478 Wazee Street Opportunities Fund IV LP v. United States …………… Common
PRAYER FOR RELIEF
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);
http://www.glenbradford.com/wp-content/uploads/2018/08/18-cv-03478-0001.pdf
19-7062 Joshua J. Angel v. Freddie Mac ……………. Preferred
PRAYER FOR RELIEF
A. Declaring that Defendants breached the terms of the Certificates of Designation
governing Fannie Mae’s and Freddie Mac’s Junior Preferred stocks;
B. Declaring that Defendants breached the implied covenant of good faith and fair
dealing inherent in the Certificates of Designation governing the Fannie Mae, and Freddie Mac Junior Preferred stock;
C. Awarding compensatory damages in favor of Plaintiff and against the Defendants. for breach of Plaintiff's contractual rights for dividends, with interest thereon from the respective missed dividend payment dates.
D. Awarding in compensatory damages in favor of Plaintiff and against the Defendants for breaches of the Company’s Certificates of Designation and the implied covenant of good faith and fair dealing, including interest thereon from the respective missed dividend payment dates;
E. Awarding compensatory damages in favor of Plaintiff for Aiding and Abetting the
Federal Government in avoiding payment on its implicit guaranty of Junior Preferred dividends, with interest thereon from the respective missed dividend payment dates.
https://www.courtlistener.com/recap/gov.uscourts.dcd.196956/gov.uscourts.dcd.196956.1.0.pdf
13-1439 Arrowood Indemnity Company v. Fannie Mae …… Preferred
PRAYER FOR RELIEF
a. Declaring that the Net Worth Sweep, and its adoption, are not in
accordance with and violate HERA within the meaning of 5 U.S.C. § 706(2)(C), and that
Treasury acted arbitrarily and capriciously within the meaning of 5 U.S.C. § 706(2)(A)
by executing the Net Worth Sweep;
b. 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;
c. Vacating and setting aside the Net Worth Sweep, including its provision
sweeping all of the Companies’ net worth to Treasury every quarter;
d. Enjoining FHFA and its officers, employees, and agents from
implementing, applying, or taking any action whatsoever pursuant to the Net Worth
Sweep
e. Enjoining Treasury and its officers, employees, and agents from
implementing, applying, or taking any action whatsoever pursuant to the Net Worth
Sweep;
f. Enjoining FHFA and its officers, employees, and agents from acting at the
instruction of Treasury or any other agency of the government and from re-interpreting
the duties of FHFA as conservator under HERA;
g. Awarding Plaintiffs damages resulting from the breach of fiduciary duty
by FHFA, Fannie, and Freddie;
h. Awarding Plaintiffs damages resulting from the breach of contract and
breach of the implied covenant of good faith and fair dealing by FHFA, Fannie, and Freddie;
i. Awarding Plaintiffs damages and injunctive relief resulting from the
restructuring of dividends on Treasury’s senior preferred stock in violation of Delaware and Virginia law;
https://gselinks.com/Court_Filings/Arrowood/13-cv-01439-0083.pdf
13-1053 Fairholme Fund, Inc. v. FHFA …… Preferred
PRAYER FOR RELIEF
a. Declaring that the Net Worth Sweep, and its adoption, are not in
accordance with and violate HERA within the meaning of 5 U.S.C. § 706(2)(C), and that
Treasury acted arbitrarily and capriciously within the meaning of 5 U.S.C. § 706(2)(A)
by executing the Net Worth Sweep;
b. 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;
c. Vacating and setting aside the Net Worth Sweep, including its provision
sweeping all of the Companies’ net worth to Treasury every quarter;
d. Enjoining FHFA and its officers, employees, and agents from
implementing, applying, or taking any action whatsoever pursuant to the Net Worth Sweep;
e. Enjoining Treasury and its officers, employees, and agents from
implementing, applying, or taking any action whatsoever pursuant to the Net Worth
Sweep;
f. Enjoining FHFA and its officers, employees, and agents from acting at the
instruction of Treasury or any other agency of the government and from re-interpreting
the duties of FHFA as conservator under HERA;
g. Awarding Plaintiffs damages resulting from the breach of fiduciary duty
by FHFA, Fannie, and Freddie;
h. Awarding Plaintiffs damages resulting from the breach of contract and
breach of the implied covenant of good faith and fair dealing by FHFA, Fannie, and
Freddie;
i. Awarding Plaintiffs damages and injunctive relief resulting from the
restructuring of dividends on Treasury’s senior preferred stock in violation of Delaware
and Virginia law;
https://www.courtlistener.com/recap/gov.uscourts.dcd.160910/gov.uscourts.dcd.160910.74.0.pdf
----------------------------------------------------
Cases in Sweeney’s court (Derivative)
----------------------------------------------------
18-1124C Wazee Street Opportunities Fund IV LP v. United States …………… Common
PRAYER FOR RELIEF
1. Certifying that this action is a proper class action under Rule 23(a) and
(b)(3) of the Federal Rules of Civil Procedure on behalf of the Classes
defined herein;
2. Finding that the Defendant has taken Plaintiffs’ property without just
compensation, has illegally exacted Plaintiffs’ property, and has breached
the express and implied terms of Plaintiffs’ contracts;
3. Determining and awarding to Plaintiffs and the Classes the just
compensation and/or damages sustained by them as a result of the
violations set forth above;
4. On Count IX, ordering restitution and reformation as appropriate to
ensure full compensation to Fannie Mae and the Fannie Common Class
for damages suffered from the Third Amendment;
5. Awarding Plaintiffs prejudgment interest on any damages or just
compensation to which Plaintiffs are entitled;
6. Awarding Plaintiffs their reasonable costs and expenses incurred in this
action, including counsel fees and expert fees
COUNT IX DERIVATIVE CLAIM ON BEHALF OF FANNIE MAE
199. appropriating and illegally exacting the property of Fannie Mae shareholders, the Third Amendment also appropriated and illegally exacted the property of Fannie Mae.
200. Moreover, if the Third Amendment is held to have been entered into in violation of HERA or the Constitution, then it is unlawful and void.
201. As a party to an unlawful and void agreement, Fannie Mae is entitled to seek a return of all amounts transferred to Treasury pursuant to the Third Amendment.
202. In addition, Fannie Mae is entitled to reformation of the underlying PSPA to invalidate and excise the Third Amendment.
203. Fannie Mae has suffered injury as a direct and proximate result of the unlawful Third Amendment, including monetary damage.
204. Fannie Mae is controlled by FHFA, which was a party to, and as an agency of the Government benefitted from, the illegal and unconstitutional actions challenged here. FHFA is therefore not disinterested with regard to Plaintiffs’ claims, and thus it would be
futile to demand that FHFA bring these claims on behalf of Fannie Mae. Additionally,
Plaintiffs’ alternative derivative claim is not a collusive action intended to confer jurisdiction on this Court that it would otherwise lack and they were shareholders at the time of the transaction complained of. Plaintiffs and the Fannie Common Class are therefore entitled to bring these claims on a derivative basis on Fannie’s behalf, to the extent the claims are held to be derivative rather than direct.
http://www.glenbradford.com/wp-content/uploads/2018/08/18-cv-03478-0001.pdf
18-1150 Highfields Capital v. United States ……………………………. Common & Preferred
PRAYER FOR RELIEF
A. Finding that the United States has taken or illegally exacted Plaintiffs’ private
property in violation of the Takings or Due Process Clauses of the Constitution;
B. Awarding Plaintiffs just compensation under the Fifth Amendment for the United
States’ taking of its property;
C. Determining and awarding to Plaintiffs the damages sustained by them as a result
of the violations set forth above;
D. Awarding rescissory damages, based upon the breach of fiduciary duty that occurred;
E. Awarding Plaintiffs pre-judgment and post-judgment interest
http://gselinks.com/wp-content/uploads/2018/08/18-01150-0001-Complaint-Filed-8-8-18.pdf
13-465C FAIRHOLME FUNDS, INC. v. United States ………….. Common & Preferred
PRAYER FOR RELIEF
Excluding the “SEALED” second amended complaint prayer of relief
A. Awarding Plaintiffs just compensation under the Fifth Amendment for the Government’s taking of their property;
B. Awarding Fannie and Freddie just compensation under the Fifth Amendment for the Government’s taking of their property;
C. Awarding Plaintiffs damages for the Government’s illegal exaction of their stock;
D. Awarding Fannie and Freddie damages for the Government’s illegal exaction of their net worth;
E. Awarding Plaintiffs damages for the Government’s breach of fiduciary duty;
F. Awarding Fannie and Freddie damages for the Government’s breach of fiduciary duty;
G. Awarding Plaintiffs damages for the Government’s breach of implied-in-fact contract;
H. Awarding Fannie and Freddie damages for the Government’s breach of implied-in-fact contract;
I. Awarding Plaintiffs pre-judgment and post-judgment interest
https://gselinks.com/Court_Filings/Fairholme/13-465-0404.pdf
13-385C WASHINGTON FEDERAL ………………………………… Common & Preferred
PRAYER FOR RELIEF
A. Determining that this action may be maintained as a class action;
B. Certifying Classes of, (A) for Fannie Mae (1) all persons or entities who held shares
of Fannie Mae common stock on or before September 5, 2008, and (2) all persons or entities who
held shares of Fannie Mae preferred stock on or before September 5, 2008; and, (B) for Freddie
Mac (1) all persons or entities who held shares of Freddie Mac common stock on or before
September 5, 2008, and (2) all persons or entities who held shares of Freddie Mac preferred stock
on or before September 5, 2008.
C. Finding that Plaintiffs have met the requirements of a class representative and may
maintain this action as representatives of the Classes;
D. Finding that the Defendant has taken and/or illegally exacted Plaintiffs’ and the
Classes private property in violation of the Due Process and Takings Clauses of the United States
Constitution;
E. Determining and awarding Plaintiffs and the Classes damages suffered by them by
virtue of the Defendant’s taking and/or illegal exaction in the amount of $41 billion, or some other
amount to be determined at trial;
F. Prejudgment and post-judgment interest, together with any and all further costs,
disbursements and reasonable attorneys’ and experts’ fees;
https://www.courtlistener.com/recap/gov.uscourts.uscfc.28070/gov.uscourts.uscfc.28070.70.0_1.pdf
13-672C SHIPMON …………………………………………………………… Common
PRAYER FOR RELIEF
A. Finding that the United States has unlawfully taken the private property of
Fannie Mae for public use without just compensation in violation of the
Takings Clause of the Fifth Amendment to the U.S. Constitution;
B. Determining and awarding Fannie Mae just compensation for the
Government's taking of its property;
C. Awarding Plaintiff the costs and disbursements of the action, including
reasonable attorneys’ fees, experts’ fees, costs, and other expenses; and
D. Granting such other and further relief as the Court deems just and proper.
https://www.courtlistener.com/recap/gov.uscourts.cofc.28831.1.0.pdf
13-608C BRYNDON FISHER FNMA .........……………………………… Common
CLAIMS FOR RELIEF
Unlawful Taking Without Just Compensation
Under the Fifth Amendment to U.S. Constitution
102. Plaintiffs incorporate by reference and reallege each and every allegation
of the preceding paragraphs, as though fully set forth herein.
103. The Fifth Amendment to the United States Constitution provides that no
person shall "be deprived of life liberty, or property, without due process of law; nor
shall private property be taken for public use, without just compensation."
104. By imposing the Net Worth Sweep, which in Treasury's own words was
designed to take "every dollar of earnings [Fannie Mae] generates ... to benefit
taxpayers," the Government took all reasonable value of the Company for public use.
105. When the Government takes private property for a public use or a public
purpose, the Fifth Amendment requires the payment of "just compensation."
106. The Government did not pay just compensation to Fannie Mae for its
taking of the entire net worth of the Company. As a result, Fannie Mae was injured and
is entitled to just compensation in a sum equal to the amounts taken by the Government
through its unlawful imposition of the Net Worth Sweep.
PRAYER FOR RELIEF
WHEREFORE, Plaintiffs, on behalf of Fannie Mae, demand judgment against the United States of America as follows:
A. Finding that the United States has unlawfully taken the private property of Fannie Mae for public use without just compensation in violation of the Takings Clause of the Fifth Amendment to the U.S. Constitution;
B. Determining and awarding Fannie Mae just compensation for the
Government's taking of its property;
C. Awarding Plaintiffs the costs and disbursements of the action, including reasonable attorneys' fees, experts' fees, costs, and other expenses; and D. Granting such other and further relief as the Court deems just and proper.
https://www.courtlistener.com/recap/gov.uscourts.cofc.28753.1.0.pdf
14-152C BRUCE REID FMCC .........……………………………………… Common
CLAIMS FOR RELIEF
Unlawful Taking Without Just Compensation
Under the Fifth Amendment to U.S. Constitution
115. Plaintiffs incorporate by reference and reallege each and every allegation
of the preceding paragraphs, as though fully set forth herein.
116. The Fifth Amendment to the United States Constitution provides that no
person shall “be deprived of life liberty, or property, without due process of law; nor
shall private property be taken for public use, without just compensation.”
117. By imposing the Third Amendment, which in Treasury’s own words was
designed to take “every dollar of earnings [Freddie Mac] generates ... to benefit
taxpayers,” the Government took all reasonable value of the Company for public use.
118. When the Government takes private property for a public use or a public
purpose, the Fifth Amendment requires the payment of “just compensation.”
119, The Government did not pay—and under the Third Amendment will not
pay—just compensation to Freddie Mac for its taking of the entire net worth of the
Company. As a result, Freddie Mac has been injured and is entitled to just compensation
in a sum equal to the amounts taken by the Government through its unconstitutional
imposition of the Third Amendment.
PRAYER FOR RELIEF
WHEREFORE, Plaintiffs, on behalf of Freddie Mac, demand judgment against
the United States of America as follows:
A. Finding that the United States has unlawfully taken the private property of Freddie Mac for public use without just compensation in violation of the Takings Clause of the Fifth Amendment to the U.S. Constitution;
B. Determining and awarding Freddie Mac just compensation for the
Government’s taking of its property;
C. Awarding Plaintiffs the costs and disbursements of this action, including
reasonable attorneys’ fees, experts’ fees, costs, and other expenses; and
D. Granting such other and further relief as the Court deems just and proper.
https://www.courtlistener.com/recap/gov.uscourts.uscfc.29350/gov.uscourts.uscfc.29350.1.0.pdf
14-740C LOUISE RAFTER .........………………………………….. Common
CLAIMS FOR RELIEF[
CLAIM I – Just Compensation Under the Fifth Amendment for the Taking of Private
Property for Public Use (Derivative Claim on Behalf of Fannie Mae by Plaintiff Rafter and
the Rattien Plaintiffs)
CLAIM II – Just Compensation Under the Fifth Amendment for the Taking of Private
Property for Public Use (Direct Claims by All Plaintiffs) CLAIM III – Illegal Exaction (Derivative Claim on Behalf of Fannie Mae by Plaintiff Rafter and the Rattien Plaintiffs) CLAIM IV – Breach of Contract: Reformation of Contract to Undo Unlawful Amendment
to Contract and Restitution of Funds (Derivative Claim on Behalf of Fannie Mae by Plaintiff
Rafter and the Rattien Plaintiffs)
CLAIM V – Breach of Contract: Fannie Mae’s Charter, By-Laws and the Delaware General Corporations Law (Direct Claim by All Plaintiffs)
CLAIM VI – Breach of Contract: Covenant of Good Faith and Fair Dealing Implied in Fannie
Mae’s Charter (Direct Claim by All Plaintiffs)
CLAIM VII – Breach of Contract: Covenant of Good Faith and Fair Dealing Implied in Freddie Mac’s Charter (Direct Claim by Plaintiff Pershing Square)
PRAYER FOR RELIEF
a. On Claim I, awarding Fannie Mae just compensation under the Fifth Amendment
for the Government’s taking of its property, in amount to be determined at trial;
b. On Claim II, awarding Plaintiffs just compensation under the Fifth Amendment for
the Government’s taking of their property, in an amount to be determined at trial;
c. On Claim III, awarding Fannie Mae damages for the Government’s illegal exaction
of its money, in amount to be determined at trial;
d. On Claims IV, awarding Fannie Mae damages, reformation, disgorgement,
equitable restitution or other appropriate relief for the United States’ illegal amendment to and breach of contract;
e. On Claims V, VI and VII, awarding Plaintiffs damages, disgorgement, restitution
or other appropriate relief for the United States’ breach of contract, in amount to be determined at trial;
f. Awarding Plaintiffs the costs and disbursements of this action, including reasonable
attorneys’ and experts’ fees, costs and expenses; and
g. Granting such other, further and different relief as this Court deems just and proper.
https://gselinks.com/Court_Filings/Rafter/14-740-0027.pdf
13-466C JOSEPH CACCIAPALLE … …….. …… …… …… ………Preferred
PRAYER FOR RELIEF
WHEREFORE, Plaintiffs pray for relief and judgment, as follows:
1. Certifying that this action is a proper class action under Rule 23 of the Rules of the United States Court of Federal Claims on behalf of the Classes defined herein;
2. Finding that the Defendant has taken Plaintiffs’ property without just compensation, has illegally exacted Plaintiffs’ property, and has breached the express and implied terms of Plaintiffs’ contracts;
3. Determining and awarding to Plaintiffs the just compensation and/or damages sustained by them as a result of the violations set forth above;
4. Awarding Plaintiffs prejudgment interest on any damages or just compensation to which Plaintiffs are entitled;
5. Awarding Plaintiffs their reasonable costs and expenses incurred in this action, including counsel fees and expert fees; and
6. Granting such other and further relief as the Court may deem just and proper.
https://gselinks.com/Court_Filings/Cacciapalle/13-466-0067.pdf
13-496C AMERICAN EUROPEAN INSURANCE …….. ……. Preferred
PRAYER FOR RELIEF
A. Certifying this action as a class action and Plaintiff as Class representatives:
B. Awarding Plaintiff and the Class just compensation for the Government’s taking
of their property;
C. Awarding Plaintiff the costs and disbursements of the action, including reasonable
attorneys’ fees, experts’ fees, costs, and other expenses; and
D. Granting such other and further relief as the Court deems just and proper.
https://www.courtlistener.com/recap/gov.uscourts.cofc.28421.1.0.pdf
Excluded prayers for relief:
FRANCIS J. DENNIS (deceased)…. …… ……. ………Case No. 13-542C Preferred
ARROWOOD INDEMNITY COMPANY .........…Case No. 13-698C Preferred
OWL CREEK ASIA I L.P........... …… …… …… ……….Case No. 18-281C Preferred
AKANTHOS OPPORTUNITY MASTER FUND ...Case No. 18-369C Preferred
APPALOOSA INVESTMENT ......... …… …… ……….Case No. 18-370C Preferred
CSS LLC …… …… …… …… …… …… …… …… …… ……….Case No. 18-371C Preferred
MASON CAPITAL L.P........... …… …… …… …… ……..Case No. 18-529C Preferred
683 CAPITAL PARTNERS …… …… …… …… …… …….Case No. 18-711C Preferred
PATT ….. …… …… …… …… …… …… …… …… …… ……….Case No. 18-712C Preferred
Subject To: Eminent Domain Replevin Hung Jury Imputed Negligence Infringement Judgment Reversed Malfeasance Negligence Perjury Prima Facie Rebuttal Settle Settlement Judgment Relief Negotiations in Federal National Mortgage Association Fannie Mae FNMA stock common preferred ISIN US3135867527 FNMAP FNMAO FNMFO FNMAM FNMAG FNMAN FNMAL FNMAK FNMAH FNMAI FNMAJ FNMAS FNMAT FNMFM FNMFN, FEDERAL HOME LOAN MORTGAGE CORPORATION Freddie Mac stock common preferred FMCC ISIN US3134003017 FMCKJ FMCKI FMCCM FMCCK FMCCT FMCCI FMCKK FMCCG FMCCH FMCCL FMCCN FMCCO FMCCP FMCCJ FREGP FMCKP FMCCS FMCKO FMCKM FMCKN FMCKL Federal Housing Finance Agency FHFA U.S. Treasury recapitalization investor lawsuit litigation Net Worth Sweep Profit Sweep Net Sweep lawsuit coercive takeover board of directors BOD Sealed Protected Information Documents Minutes of a meeting of the Board of Directors of Fannie Mae
Yes it would the ideal time, but I’m not sure it can wait that long, as soon as Seila and Sisti are decided, they give a blank check to plaintiffs, because negotiations are no longer possible as the government out of free will has undo whatever the court decides is unconstitutional, then the statute of limitation starts again, what will give problems to later offerings down the road and again the government is liable for those losses
But maybe they are indeed that naïve or perverse, my thought is they are in settlement negotiations as of now, before Seila and Sisti are decided, at least it would make sense moneywise
Agree
Expiration of the shorts is always the 3th Friday of the month, so next Friday all shorts need to roll it or take their losses
Yes probably, but a lot needs to be resolved in the meantime, not sure what the additional problems are when FHFA is declared unconstitutional in the Seila case, if it is severed, a lot of additional questions need to be answered as the power is different in an independent agency than in a dependent agency and if the powers used where appropriate, if independent is not severed that part of HERA can be voided and we can go back to the OHFEO regime, but whatever they decide, we go back to a less controlling regime, no matter what, in the meantime they probably will align the questions asked, and find common ground and prepare the settlement to be finalized just before election
Question that need to be resolved in settlement:
1) Was the conservatorship legal
2) Is the SPSPA legal
3) Is the NWS legal
4) Is FHFA legal as independent agency
5) Is HERA legal with unconstitutional claims
6) Why was there no Rescission of the SPSPA Contract
7) Why was there no Completion of the SPSPA Contract
8) Can a conservator do the opposite of what their statue says
9) Can they coerce the board into accepting conservatorship and abandon their shareholder obligations and statue
10) Can they “seal” and hide lawsuits while working for the public
11) Are the redacted lines in documents inline with the constitution
12) What would be Just compensation
13) What would be Estimated Economic Damages
14) What would be Punitive damages
15) What would be other Damage demands
16) What would be common shareholder relief
17) What would be Pref shareholder relief
18) What would be FnF relief
19) Can FHFA continue as creditable agency
20) Must FHFA return the operational funds already distributed
21) What will be the yearly compensation for the new CSP/CSS debacle
22) What is necessary to prevent future lawsuits
Each of these questions will release a jungle of new questions depending on what is determined, but for sure this is unprecedented and must soon come to a conclusion
Margaret M. Sweeney as Chief Judge can serve upto 2025, she was born in 1955 and as President Trump designated her as Chief Judge, she can serve upto 70 years of age.
"Pressure in immense"
I wouldn’t put that much faith into an Agency that does the opposite of what their statue says
Although a lot of cases are dismissed, thru discovery, surfaced a problem the government cannot overcome, if it is allowed the constitution is at risk, and so are the financial markets with it (as the government already claims) I would advise you to re-read document 428
“As Treasury noted when entering the PSPAs, the warrants “provide potential future upside to the taxpayers.” Say what? https://www.courtlistener.com/recap/gov.uscourts.uscfc.28224/gov.uscourts.uscfc.28224.428.0.pdf
This of course is nobel, but unconstitutional as congress did not authorize FHFA to take future profits of a company, let alone it granted them to run the companies for profit sake, 12 U.S. Code § 4617,
Only Ones the warrant is excised the statute of limitation starts, so everybody involved will have standing in perpetually because it is unconstitutional
If the government takes something it needs to compensate, then in other written law you cannot claim it can do whatever it pleases without compensation, so that part needs to be null and voided thru judicial review or “indirect” judicial review, throughout the cases a lot of unconstitutional things are claimed, so on all of them a solution is pending as it is specifically mentioned in the lawsuits, there is no need to file a new lawsuit, time will tell
Because FnF reported the share count does not make it legal
Because investors know the existence does not make it legal
If exercised the share count will pressure the EPS and make future offerings more unsuccessful
The 5.7B share count will make the EPS too low, so will dividends, etc, etc
Cite the law: 11 U.S. Code § 1122. + ”conserve and preserve” + Fifth Amendment's Just Compensation Clause (which contradicts 4716 operate in the best interest of FHFA
This will solve itself, the government First thing they now need to proof is there was no such thing as Coercion
(spoiler alert: the case was sealed and documents already proof coercion, why otherwise bring the point if you don’t have proof supporting your claim)
What they take with the exercise is 4.6B shares (79.9%) that will hurt FnF EPS, and impact the value of the shares and make future offerings more difficult, so they DO take future profits of the company, and they took future profits of the company by entering into the warrant, and according to solvency law you cannot operate a business for your own profit, and the companies never were insolvent, so what they do is unconstitutional, and operate in the interest of the taxpayer is also unconstitutional as shareholders are not compensated, so we have standing in perpetually
https://www.scribd.com/document/221220936/FNMA-FHLMC-Liquidation-Valuation-Analysis
Net Liquidation Proceeds Fannie Mae.......$97,589M
Net Liquidation Proceeds Freddie Mac......$73,786M
Fannie & Freddie Lawsuits Updated
19-422 Collins v. Mnuchin (Pending petition SCOTUS) .…Common & Preferred
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. Collins (Pending petition SCOTUS)…Common & Preferred
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/
16-3113 Collins v. Lew …………………….…Common & Preferred
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/
After appeal 17-20364, 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)
18-2506 (17-2185) Bhatti vs. FHFA……………Common & Preferred
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
(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)
13-1288 Miscellaneous Class Action …Common & Preferred
Honorable: Royce C. Lamberth
Claim: money damages or compensatory relief on : “breach of contract” “breach of the implied covenant of good faith and fair dealing” and “breach of fiduciary duty”
District Court for the District of Columbia
The Class:
13-cv-1094 (rlw) Mary Meiya Liao,
13-cv-1149 (rlw) Joseph Cacciapalle, et al.,
13-cv-1169 (rlw) American European Insurance Company
13-cv-1184 (rlw) John Cane,
13-cv-1208 (rlw) Francis j. Dennis,
13-cv-1421 (rlw) Marneu Holdings Company, et al.,
13-cv-1443 (rlw) Barry p. Borodkin, et al.
https://www.courtlistener.com/docket/4212341/in-re-fannie-maefreddie-mac-senior-preferred-stock-purchase-agreement/
Fact discovery Shall close on April 30, 2020, Trial is set for March 31, 2021 (with a pretrial 30-60 days before)
17-497 Rop v. Federal Housing Finance agency…….Common & Preferred
Honorable: Paul L. Maloney
Claim: voiding 3th amendment & “for cause” separation of powers
District Court, W.D. Michigan
https://www.courtlistener.com/docket/13521280/rop-v-federal-housing-finance-agency/
No next Date available (waiting on Collins, as document 64 says “notice of supplemental authority concerning Collins v. Mnuchin” )
18-3478 Wazee Street Opportunities Fund IV LP v. United States……………Common
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/
Aug 2, 2019 Stipulation and Order doc#36 (waiting on Collins as document 38 says Supplemental authority filed by Defendant ….. in the matter of Collins v. Mnuchin, No. 17-20364)
19-7062 Joshua J. Angel v. Freddie Mac …………….Preferred
Previously assigned to: Honorable: Royce C. Lamberth
Claim: Breach of quarterly BOD duties, breach of contract, breached the implied covenant of good faith and fair dealing, breach of contractual rights for dividends, Breach of implicit guaranty on Junior Preferred dividends
District Court for the District of Columbia
On appeal in the United States Court of Appeals for the district of columbia circuit
https://www.courtlistener.com/docket/26534/joshua-angel-v-federal-home-loan-mortgage-co/
deferred appendix due 01/29/2020. final briefs due 02/12/2020
13-1439 Arrowood Indemnity Company v. Fannie Mae……Preferred
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/
(Related to case Arrowood 13-698C & Joshua J. Angel, 18-1142 Doc# 3 & 89)
Fact discovery Shall close on April 30, 2020, Trial is set for March 31, 2021 (with a pretrial 30-60 days before)
13-1053 Fairholme Fund, Inc. v. FHFA……Preferred
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/
Fact discovery Shall close on April 30, 2020, Trial is set for March 31, 2021 (with a pretrial 30-60 days before)
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Cases in Sweeney’s court
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18-1124C Wazee Street Opportunities Fund IV LP v. United States……………Common
Honorable: Nitza I Quinones Alejandro
United States Court of Federal Claims
Claim: 3th amendment & “for cause” separation of powers
https://www.courtlistener.com/docket/7681282/wazee-street-opportunities-fund-iv-lp-v-the-federal-housing-finance-agency/
propose further proceedings by no later than twenty-one days after the aforementioned joint status report in Fairholme Funds is filed (http://www.glenbradford.com/wp-content/uploads/2020/01/18-1124-0011.pdf)
18-1150 Highfields Capital v. United States……………………………. Common & Preferred
Honorable: Margaret M. Sweeney
Claim: taking or illegal exaction under the Fifth Amendment https://www.pacermonitor.com/public/case/25303845/HIGHFIELDS_CAPITAL_I_LP_et_al_v_USA
propose further proceedings by no later than twenty-one days after the aforementioned joint status report in Fairholme Funds is filed
Related To: Fairholme, Arrowood, Cacciapalle, 13-469, Dennis, Wazee Street, Fisher, Shipmon, Reid, Rafter, Owl Creek, Appaloosa, Akanthos, Css, Mason, 683 Cap. Partners, Patt
13-465C FAIRHOLME FUNDS, INC. v. United States…………..Common & Preferred
Honorable: Margaret M. Sweeney
United States Court of Federal Claims
Claim: **SEALED**AMENDED COMPLAINT (Entered: 03/08/2018) probably False Narrative, Government coercion, Coercion by the White House and Treasury, FHFA Conflict of Interest, a Taking, Illegal Exaction Claims, Exceeded Statutory Authority, Breach of Fiduciary Duty. As stated in doc 428
https://www.courtlistener.com/docket/4198608/fairholme-funds-inc-v-united-states/
Jan-29, 2020 “In the interest of judicial economy and preserving the parties’ resources,” Chief Judge Sweeney entered a series of single-sentence orders today staying consideration of the government’s omnibus motion to dismiss in all of the cases before the U.S. Court of Federal Claims “pending the determination of further proceedings in Fairholme Funds, Inc. v. United States, No. 13-465C.”
Cases below stay upon relief/discovery in the Fairholme Case
WASHINGTON FEDERAL………………………………Case No. 13-385C Common & Preferred
BRYNDON FISHER .........………………………………Case No. 13-608C Common
SHIPMON………………………………………………………Case No. 13-672C
BRUCE REID .........………………………………………Case No. 14-152C Common
LOUISE RAFTER .........………………………………….Case No. 14-740C Common
Cases below stay 60 days after jurisdictional discovery in Fairholme Funds
JOSEPH CACCIAPALLE ………..………………………Case No. 13-466C Preferred
AMERICAN EUROPEAN INSURANCE……..…….Case No. 13-496C
DENNIS…………………………………….………….………Case No. 13-542C
ARROWOOD INDEMNITY COMPANY .........…Case No. 13-698C Preferred
OWL CREEK ASIA I L.P...........……………………….Case No. 18-281C Preferred
AKANTHOS OPPORTUNITY MASTER FUND ...Case No. 18-369C Preferred
APPALOOSA INVESTMENT .........………………….Case No. 18-370C Preferred
CSS LLC ……………………………………………………….Case No. 18-371C Preferred
MASON CAPITAL L.P...........…………………………..Case No. 18-529C Preferred
Cases below stay pending disposition of Owl Creek
683 CAPITAL PARTNERS……………………………….Case No. 18-711C Preferred
PATT …..……………………………………………………….Case No. 18-712C Preferred
Name: Sisti v. Federal Housing Finance Agency
Case number: 17-005 (90-1762)
Honorable: John J. 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/
Factual Discovery to close by 12/30/2019;
Plaintiff's Expert Disclosures shall be made by 1/30/2020;
Defendants' Expert Disclosures shall be made by 2/28/2020;
Expert Discovery to close by 3/30/2020
Dispositive Motions due by 4/30/2020.
Seila law v. Consumer Financial Protection bureau
Case number: 19-7
Court: Supreme Court of the United States
Claim: “for cause”” removal violates the separation of powers
https://www.scotusblog.com/case-files/cases/seila-law-llc-v-consumer-financial-protection-bureau/
Set for argument on Tuesday, March 3, 2020. Decision in the last 2 weeks of June -2020
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
Petitioner and the government agree on the fist question, but disagree on the second question
Petitioner 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)
Yes a taking in 2008, in 13-465C Fairholme it says Government coercion, Coercion by the White House and Treasury in document 428, https://www.courtlistener.com/recap/gov.uscourts.uscfc.28224/gov.uscourts.uscfc.28224.428.0.pdf
Defining “world-class regulator” : An Agency who keeps super profitable companies hostage because they deplete their capital in perpetually, and call them undercapitalized
Preparing other minds for a defeat
19-563 Mnuchin v. Collins,
1) The anti-injunction clause did not grant FHFA to act outside their statue witch says conserve and preserve, and the in perpetually is in conflict with the constitution as relief is not possible
2) 12 U.S.C. 4617(f) Defendant Mnuchin fails to provide what the conditions surrounding “likely” are and how the determination was achieved, so it is open for multiple interpretations and is in conflict with their own minimal capital standard
3) succession clause 12 U.S.C. 4617 (b)(2)(A) (I)
does not prevent shareholders to challenge conservator actions that where not granted by congress
19-422 Collins v. Mnuchin
1) for cause undermines the president’s power as he is not in control ones he is elected by the people
2) because the for cause is in conflict with the constitution the FHFA can no longer be independent and the final action ( 3th amendment) needs to be struck down
Sure I understand, you don’t understand, it just makes the world function the way it does, without ethics nothing would work in this world, every person faces hundreds of ethical problems a day, should I call in sick, or should I go to work, should I stop for the red traffic light or not, ethics are about what is expected from you, now if treasury does not pay its debts, nobody will give them new money, if FnF shareholders are screwed they will not buy into it again, if the judges declare the conservatorship legal, duress becomes legal, just imagine that it is not always about the money, no person in the government makes a dime more, if SM settles he doesn’t make a dime for his personal benefit nor does MC if he agrees, then the ethics come into play and if he doesn’t agree to a settlement he has “unethical” problems that force him to disagree with the problem(like BC stating to short) , which will hunt him for decades, this is best seen in the conservatorship itself in 2008, there was a problem in the market, and HP thought it was the best option to enter into FnF to safe the banks, but was it fair for the shareholders who thought they had a safe investment, no it was not, so it was a perverse ethical problem, HP did drive though the red traffic light in 2008, and see what a problem that gives, now 12 years later plaintiff are still fighting about it, and will win because of the ethics surrounding the problem, imagine treasury would not care about ethics at all…and that is why this 1 time event produced so many lawsuits, so you might want to reconsider your thoughts
Lamberth Said because of 4617 he has no authority to rule on this so it needs to be dismissed, however it is a taking and resolution needs to be given because of the constitution, so it is a catch-22, indeed the actions can be put aside because they exceeded their power, but that is now pending in Atlas Sweeney and Lamberth, which is a problem because in discovery Coercion surfaced, so everything needs to be undone because of that, so imo Sweeney will be leading and the rest will follow
And Seila law will give resolution to FHFA unconstitutionally, so they can rewrite or void the whole HERA as it has a list with multiple unconstitutional rules
What to think of
‘‘SEC. 1313. DUTIES AND AUTHORITIES OF DIRECTOR.
‘‘(v) the activities of each regulated entity and
the manner in which such regulated entity is operated
are consistent with the public interest.
Really? a controlling agency that operates in public interest? This is total nonsense and is unconstitutional; you cannot give away rights to another person while you control them yourself as regulator plain and simple a no go, the list goes on and on, already have 3 pages with illegal HERA stuff but it is not finished yet, its looks like a frustration act rather than a regulating one