Fannie Mae-No Politics (FNMA)

[obiterdictum]

Hi YanksGhost,

The use of warrants and Senior Preferred Stock are part of a legal transaction pattern that was commonly used by the US Treasury during the bailout (TARP and CPP).

See: WARRANT DISPOSITION REPORT – UPDATE JUNE 30, 2012
https://www.treasury.gov/initiatives/financial-stability/reports/Documents/December%202012%20Warrant%20Disposition%20Report.pdf

One reason that the warrants were not challenged by any of the lawsuits is that they are part of a customary legal transaction that could not be argued to be illegal. No actual harm was done, though "perceptions" of harm hypothetically affected share prices. The pricing of the warrants may have been outrageous, but since there are mutually signed agreements, there is little possibility of mounting a successful legal challenge to them in court.

Depending on the civil law of the relevant jurisdiction and type of claim, if the civil statute of limitations is reached, a claim may not be filed or if filed the claim will most likely be dismissed. However, when considering the warrants, the time for equitable tolling, depending on the jurisdiction, could begin when the warrants are exercised since no harm arises for equity owners by the warrants' mere existence.

Judges will review and decide a claim that is ripe, that is, a claim that is a clear cut legal matter (breach of contract) or a claim for damages based on concrete facts (loss of income/value/property/body part). In a civil claim pursuing such damages, harm must be demonstrably actual. Hypothetical, possible or impending harm does not count. Thus, if there is a claim that that warrants can potentially damage a plaintiff, though it has not harmed anyone at the time of the claim, that claim would be considered not ripe for adjudication. Federal courts adjudicate claims based on actualities and have no constitutional authority to adjudicate claims based on theories.