Coming Soon: Key Documents in Fairholme-GSE 'Takings' Case
IMFnews Wednesday, Oct 5, 2016
Judges Ruling in GSE Shareholder Case Finds No Reason to Keep Government Docs Hidden
By Carisa Chappell cchappell@imfpubs.com
Documents revealed to plaintiffs attorneys in a prominent GSE shareholder case reveal there were communications among high level officials at the Treasury Department, Federal Housing Finance Agency and White House regarding the Treasurys sweep of Fannie Mae and Freddie Mac profits.
The late September ruling in Fairholme Funds Inc. v. United States, et al. officially released late Monday helps detail the thought process behind Judge Margaret Sweeneys conclusion that the government agencies were improperly trying to keep these documents hidden under executive privilege.
For now, only a brief description of the 50-plus documents is available. Among the documents released: a draft prepared by Treasury staff containing pre-decisional deliberations related to potential preferred stock purchase agreement modifications, a confidential memo from senior White House advisors to the president on housing policy initiatives, and FHFA risk assessment memos.
There was also an email with discussions related to the federal budget and the amended PSPAs which Treasury issued in late 2012.
Fairholme which controls roughly $2.4 billion of GSE junior preferred argued that the governments various assertions of privilege (presidential communications privilege, deliberative process privilege and bank examination privilege) were flawed. Judge Sweeney agreed.
In the details of her ruling, which spans 80 pages, Sweeney wrote: Plaintiffs evidentiary need for the information outweighs defendants interest in preventing the documents disclosure, referring to one batch of documents that focused on GSE earnings projections for 2011 and 2012.
