Fannie Mae-No Politics (FNMA)

[upfnma]

Brydon is correct that the warrants are "invalid" because they were a "taking."

In

"UNITED STATES COURT OF FEDERAL CLAIMS

WASHINGTON FEDERAL, MICHAEL McCREDY BAKER, and CITY OF AUSTIN POLICE RETIREMENT SYSTEM, on behalf of themselves and all others similarly situated,

Plaintiffs,

v.

THE UNITED STATES OF AMERICA,

Defendant.


No.

COMPLAINT

...


I. NATURE OF THE ACTION

...

9. As the FHFA Office of Inspector General (“OIG”) has since acknowledged, the Government’s imposition and subsequent administration of the conservatorships, including its receipt of “a warrant to purchase 80% of the Enterprises’ stock for a nominal amount” and its execution of the Stock Agreements “rendered the common [and preferred] shares of the Enterprises virtually worthless,” thereby destroying the property rights of the Companies’ shareholders, who “effectively lost their investments.” Likewise, the Financial Crisis Inquiry Commission (“FCIC”) bluntly concluded that “[e]xisting common and preferred shareholders were effectively wiped out” by the Government’s actions.

10. Even in the middle of an unprecedented financial crisis, the Government cannot convert property rights for its own ends without providing just compensation, even if the Government’s “ends” are designed to provide a public benefit. The Fifth Amendment of the United States Constitution (“Constitution”) provides that the Government shall not deprive any person of “property without due process of law” and prohibits the Government from appropriating private property for public use “without just compensation.” Exigent circumstances do not curtail these fundamental rights. Despite the existence of such fundamental rights, beginning on September 5, 2008, the Government misappropriated billions of dollars of shareholder value in violation of the Takings and Due Process Clauses of the Constitution.