I understand the feeling behind your post and agree with the frustration behind it...but when looking to the future, it is important to recognize what is and is not possible. Otherwise, you will merely be hoping for something and investing based on it without any chance of recovery.
"Plaintiffs are claiming they were illegally denied junior preferred dividends"
Let's correct that first...illegally indicates a crime. No criminal charges have been filed. This is a civil and contracts case. The correct statement is "Plaintiffs are claiming they were wrongfully denied junior preferred dividends". That may seem like semantics...but it is important when considering the type of available remedies. The courts are limited in the remedies they may give based on the type of case involved.
"that FHFA alternatively gave to a new and more senior preferred shareholder"
This may be true...but the appropriate remedy would NOT be to give those dividends to the junior preferred shares. If the courts agree with this claim, then the appropriate remedy would be to undo the senior dividends and return them to the parent company...in this case the GSEs.
"FHFA failed to exercise proper fiduciary responsibility"
I don't believe this claim will hold water. A conservator has no fiduciary responsibilities. That's just the law, take it or leave it.
"Amendment 3 was an illegal taking under the U.S. Constitution's Fifth Amendment protection"
This is possible...there could have been a Constructive Taking. But again, the remedy of this would be to undo Amendment 3 and return the money wrongfully taken back to the GSEs.
"and an example of illegal self-dealing"
This is a fiduciary duty...as I stated above, Conservators don't have fiduciary duties.
"claiming that failure to pay dividends to all preferred dividend stockholders"
There is no duty to pay dividends. If the courts find that the dividends were wrongfully distributed, the appropriate remedy is to undo the dividends, as I stated above. There is no remedy to force the company to pay dividends that weren't already paid...only to undo the payments that shouldn't have been made. Again...dividends are NEVER a right unless they are required by the charter. So to sue for something you don't have a right to violates contract remedies law.
"I find it preposterous that a court would rule in favor of plaintiff's complaints, but remand any improperly paid SPD to the very entity that was a key player in the illegal self-dealing arrangement by which the plaintiffs were harmed. That is rewarding bad behavior."
This is erroneous. You are commingling the company with the officers/directors of the company. The money would not be paid to the officers/directors. It would be paid back to the GSEs...the GSEs that are owned by the shareholders and that the Officers/Directors owe a fiduciary duty to. If, after the payment, the Officers/Directors make actions that violate their duties again, then another lawsuit can be brought...but it doesn't reward anyone. It restores the company to the position it would have been in without the wrongdoing...THAT is what contract remedies do. (A side note, sanctions are also available against the wrongdoers...but that doesn't go to the plaintiffs.)
