Fannie Mae-No Politics (FNMA)

[kthomp19]

The money FnF have paid to Treasury is currently dividends which do not reduce the liquidation preference, then it follows how can you loan money and not allow the company to pay the amount back?

Because it's not a loan. It never was a loan. Where does anyone get the idea that the seniors were ever a loan? The seniors are equity, and equity does not get paid back. Dividends do not reduce the liquidation preference of a preferred stock share.

this sounds like a very naïve unprofessional (especially for the government) way to get yourself in real big trouble and prepare for massive lawsuits and settlements that are unheard of, and indeed that is the case, the government breaches their own laws and that is not cricket

Wrong. Treasury got preferred stock in companies other than FnF, and got in precisely zero trouble because of it (Starr's AIG case resulted in a loss for the plaintiff).

Treasury will also potentially be taking equity stakes in other companies pretty soon. They would not do this if it were illegal.

The funding commitment is not necessary and by allowing the companies to keep this funding commitment after 2012 the FHFA-C t they breached their fiduciary duty

Utter nonsense. You have it completely backwards. The funding commitment was necessary to keep FnF out of mandatory receivership (this is the return consideration FnF got for the seniors and warrants, which makes the original SPSPAs legal), and FnF even made draws in Q4 2017. It is trying to end the funding commitment that would be a breach of FHFA's fiduciary duty to FnF. From FnF's point of view the funding commitment is a good thing!

and there was never was a scenario they were not solvent(only after conservatorship and due to the actions the conservator took get got into trouble)

By the definition of balance-sheet insolvency (liabilities exceed assets), FnF were insolvent many times between 2008 and 2012, and again in Q4 2017.

Also, if you're blaming this insolvency on FHFA's accounting decisions in 2008, you will need to file your own lawsuit for that argument to mean anything. The WF cannot result in any changes being made to the original SPSPAs (the plaintiffs don't ask for it and Sweeney's court doesn't have the authority to do it).

but on the consent Fannie and Freddie gave it is not possible for treasury to convert the seniors into common stock as that would breach their implied-in-fact contract with the Board of directors and the fiduciary duty FHFA-C has towards shareholders

I have posted plenty of evidence and yet you continue to repeat this falsehood. I will say it for the umpteenth time: FHFA-C DOES NOT AND NEVER DID HAVE ANY FIDUCIARY DUTY TO SHAREHOLDERS. PERIOD.

what kind of obligations the conservator has towards shareholders

None. Period. FHFA-C only has a fiduciary duty to the companies. Not the shareholders. These are not the same thing at all.

The very fact that they can take an action that both helps the companies become sound and solvent and hurts the shareholders (a massively dilutive equity raise, which Calabria said is coming) proves this.

The SPSPA is a voidable contract with an unconstitutional amendment, this contract is not only in the eyes of a conservator a no go, but also in the eyes of the shareholders, and the BOD could not have given consent on it as it would breach their duty of candor, and FHFA-C could not allow it to happen as it is a breach of fiduciary duty towards shareholders and they did not have consent to do so, and it is unlawful as it is out of their statuary mission, and all these things are combined in the lawsuits claiming the 3th amendment is unlawful, because if the 3th is unconstitutional, the SPSPA needs to be modified and it becomes voidable and in 6.7 and 6.12 FHFA says it will void it

Good lord. 8 strikes in one paragraph!

1) It is only voidable by Treasury, at its discretion, if part of it is found to be illegal or unenforceable.
2) What plaintiff ever argued that the NWS is unconstitutional? Collins said that FHFA's leadership structure is unconstitutional; they never said the NWS was.
3) The boards' consent didn't matter for the SPSPAs because they were signed after conservatorship started, at which point the boards' fiduciary (and other) duties were pre-empted by FHFA.
4) Once again, FHFA-C has no fiduciary duty to shareholders whatsoever. Judge Sweeney said so.
5) FHFA-C did have consent. No court has found otherwise.
6) The original SPSPAs were perfectly fine when it comes to FHFA's statutory mission, it's only the NWS that isn't.
7) The NWS can, and will, be struck down while leaving the rest of the SPSPAs intact. This is all that the Collins and Perry plaintiffs want.
8) 6.7 and 6.12 give Treasury, not FHFA, the power to voluntarily unwind the entire SPSPAs. Since that would cost them $300B for nothing in return, it's safe to say they won't do so.

no judge said there is no fiduciary duty they said they lack fiduciary duty, because HERA forbids it, that is a whole different thing

Again you get this wrong. The boards' fiduciary duty to shareholders exists and is pre-empted by HERA. FHFA-C never did and does not have a fiduciary duty to shareholders; that duty never existed in the first place.

I have asked before: what law provides any evidence towards your point (that FHFA-C has a fiduciary duty to shareholders)? Why do you keep making this false and indefensible claim, that Judge Sweeney already shot down?

currently the judges say the problem is in HERA as it forbids them to take action

That doesn't matter for the fiduciary duty argument, because Sweeney did not use 4617(f) to dismiss any of her cases, and Lamberth's case got remanded back down to him. He dismissed the fiduciary duty claims a second time without relying on 4617(f).

The BOD currently has no fiduciary duty towards shareholds as the FHFA-C currently has all the powers the BOD has, and with that, the fiduciary duty, but HERA forbids that

FHFA-C succeeds to the powers of the boards, not their duties (fiduciary included). Read 12 USC 4617(b)(2)(i):

(A) Successor to regulated entityThe Agency shall, as conservator or receiver, and by operation of law, immediately succeed to—
(i) all rights, titles, powers, and privileges of the regulated entity, and of any stockholder, officer, or director of such regulated entity with respect to the regulated entity and the assets of the regulated entity

Fiduciary duty is not a right, title, power, or privilege.

Notice the change in 2019 “NOT managed”, so it is a government agency now?, not sure what they are thinking but a stupid move if you ask me, “no longer” implicates you were, but there was a change, “not managed” means it is a government agency

I do find it interesting that the wording slightly changed, but the 2019 version of that sentence has the same meaning as the previous ones. And your conclusion, "'not managed means it is a government agency", is completely false. Since the two versions of the sentence have the same meaning, you cannot say that one means FnF are government agencies and the other doesn't.

The 5th circuit did not uphold the rest of HERA as it was not a question presented

False. The Fifth Circuit did uphold the rest of HERA, they only changed the removal clause.

Yes when there is a final ruling on the 3th amendment the SPSPA becomes a voidable contract and needs to be voided by Fannie and Freddie or FHFA out of fiduciary duty they have toward shareholders, and because they say so themselves, and the law says so

The same falsities, reused and recycled.

Here's your chance then: what law says so? Include the chapter, title, and section number, as I have done with HERA, to have any chance at an argument.

The lack of BOD consent is very important

It also is only an allegation at this point. And WF is the only case alleging it, which if you recall would only result in money damages to the plaintiffs if they win. If anyone wants to try and use this lack of consent to unwind the conservatorships they will need to file a new lawsuit. I suggest you do so; it would give you a chance to put these legal theories to a productive use.

Fannie and Freddie gave voluntary the FHFA authority to implement conservatorship based on preserve and conserve and put in sound and solvent condition, all action taken by the FHFA (SPSPA) that do not fulfill preserve and conserve will need to be voided withdrawn or declared illegal as their statue does not allow these action and their fiduciary duty towards consent are not met

This is right if it only talks about the NWS. This is false if you mean the entire SPSPAs; every court so far has ruled that FHFA was well within its statutory authority to agree to the original SPSPAs.

Treasury’s wishes to keep extending the backstop, was implemented illegal

Where does any plaintiff allege this? And is it in such a way as to have it overturned?

there is a clear difference between FHFA and the FHFA-C as the FHFA-C can ONLY act in the best interest of the SHAREHOLDERS

I guess you're really going to die on this hill, even though I have proved this point wrong over and over and over. You have never given any proof or evidence that your point is right, while I have shown that Judge Sweeney, whom you like to quote, directly contradicts you.

Saying that FHFA-C can only act in the best interest of the shareholders is such a bad swing-and-miss that the bat ended up going over the center field wall. (That doesn't count as a home run, by the way)

Sweeney is talking about Direct fiduciary duty from TREASURY towards (minority) shareholders as she stated “The contract (PSPA), otherwise stated, is one step removed from the purported genesis of the fiduciary duty” so she recognizes there is fiduciary duty but as the warrant is not executed yet, the fiduciary duty is currently not present as the shareholders are not yet diluted yet

Finally, something correct. One thing you forget, though, is that the warrant document allows Treasury to do two things that will prevent it from ever being a controlling shareholder: partial exercise and the ability to assign the shares to a third party. So this point of yours is going to be moot: circumstances exist in which Treasury might have a fiduciary duty to shareholders, but those circumstances have never happened in the past and do not have to happen in the future, even if Treasury exercises the warrants.

In other words HERA forbids judicial review and because HERA is therefore unconstitutional, the Tucker Act does not apply because HERA is the problem and relief under the Tucker act cannot be granted

No, you have grossly misinterpreted what Sweeney meant. The cases in front of her don't refer to the constitutionality of HERA. And that sentence by Sweeney was justification for her dismissing plaintiffs' claims that Treasury has a fiduciary duty to shareholders.

FHFA and thereby the FHFA-C both have fiduciary duty as it is mandatory to preserve and conserve and mandatory to put in sound and solvent condition

FHFA has a fiduciary duty to the companies but not to the shareholders. Those are entirely different things.

the FHFA-C so far has said nothing on the legality of the contract

Why would they say anything when no part of the contract has been ruled illegal? Not even the NWS has, by the way, though it is likely that Judge Atlas will do so when she finally acts. The rest of the SPSPAs are legal, and no argument you have made so far proves that anything other than the NWS is illegal.

The warrant is unheard of and illegal

Wrong on both counts. Treasury got warrants in other companies and none of those warrants' exercise or sales were ever deemed illegal.

the government wanted to safe Fannie and Freddie that was the intent to conservatorship, then later on paper and television they altered this opinion to “we want to make sure the companies will be dissolved”, but that was not the intent they entered into conservatorship on, if they said to the BOD we want to dissolve Fannie and Freddie the BOD would not have agreed to this mission

This is exactly why the original SPSPAs were legal but the NWS was not.

The 79.9% is so far out of the constitution that is never can or will be executed and will be declared void ab initio(because the 3th amendment will be declared illegal the contract will be voided, but if put to test the 79.9% will not survive either)

Wrong again. Treasury had 79.9% warrants in AIG and exercised them, and it was not found to be illegal (Starr's "victory" got overturned on appeal). There is nothing illegal about the 79.9% in and of itself, and once again the NWS can disappear without affecting the rest of the SPSPAs.

The other companies who had the warrant for 79.9%(AIG/City etc) faced bankruptcy and never would have survived without the interference of treasury, Fannie and Freddie did not have this problem
...
needs to be withdrawn because the companies were not in needs of funds when conservatorship was established/coerced

This is another bit of common nonsense. Even Tim Howard said that FnF might have gone under without Treasury's assistance:

Finally, we can’t definitively say that without the non-cash accounting entries made by FHFA Fannie would have survived the crisis.

In court the burden of proof in on the plaintiff. While it is true to say that FnF might have survived on its own, it would have to be proved that they would have. And none of the sealed documents would have any bearing on this.

The Robinson case was not a loss at all

It is certainly a loss for the plaintiffs! What else would you call dismissal at every level?

1) If the SPSPA is not voided you want re-write the voidable contract definition?

You have far too much (incorrect) reliance on this idea of a voidable contract. If the NWS being struck down had to mean that the rest of the SPSPA goes, why did the Fifth Circuit not say this?

2) 6.7 and 6.12 is the law and not FHFA specific or exclusive see: https://www.investopedia.com/terms/v/voidable-contract.asp

You really need to read 6.7 and 6.12 again. It is Treasury who has the voluntary authority to unwind the whole SPSPA if part of it is found illegal or unenforceable. Since Treasury has 300 billion reasons to not do this even if it can, it's safe to say that 6.7 and 6.12 are completely irrelevant.

3) The BOD entered into contract with FHFA this contract exist out of the intent the prior BOD had, the current BOD can undo this contract if it is voidable when the final ruling on the 3th amendment is a fact, as old BOD and new BOD both represent shareholders eventhough FHFA now represents the BOD

The boards have no power at all in conservatorship, let alone the power to undo a contract.

Also, you keep saying that the original SPSPAs were illegal. If that's true, the boards don't need to wait for a court ruling that the NWS is illegal, they could just void the SPSPAs right now! Why haven't they done so? (It's because you're incorrect; the boards don't have the power to do this no matter what the fate of the NWS is)

4) Sweeney: “plaintiffs cannot establish jurisdiction for their direct fiduciary duty claim by relying on HERA”. So she does not say FHFA-C does not have a fiduciary duty, HERA forbids Fiduciary duty because it can act in its own best interest which is unconstitutional

1) Sweeney does say that FHFA-C does not have a fiduciary duty to shareholders! I have quoted it many times and I will do again:

That statement reflects a clear intent: the FHFA-C does not owe a fiduciary duty to shareholders because the conservator is not required to consider shareholders’ interests.

2) No plaintiff in any court case has said that FHFA's ability to act in its own interest is unconstitutional. Also, if Sweeney thought as you did she would not have based a legal opinion on an unconstitutional section of the law. So again, Judge Sweeney disagrees with you. And as always, when that happens she wins and you lose.

When the contract was signed a couple of days after they received consent from the BOD, they still should have known that there is no consent or intent to contract on the issues at hands in the SPSPA, the BOD could never have consented on the SPSPA

This is irrelevant. FHFA has the statutory authority to both direct the boards to sign and to act in its own interests. Neither of these things have been ruled illegal, and neither will even if all plaintiffs win their cases. A new lawsuit would be needed to get the original SPSPAs overturned.

The responsibility of the 5th circuit is only to declare HERA’s provision “for cause” constitutional or unconstitutional, they ruled unconstitutional and remanded back, Judge Atlas ruled she could not grant it because HERA forbids her, now it is back at her feet and she must declare HERA for cause unconstitutional and will wait for that ruling until the SCOTUS decided so, then she is covered on her ruling by the SCOTUS, all the other things that need to go, or be altered because of the “for cause” change, are not the problem for SCOTUS or Judge Atlas, this is the problem for congress who wrote the law and had clear understanding of the intent in this matter judges don’t re-write the law, they only declare if it is correct and accordingly to law or constitution or fair

This is a very good argument for why only the removal clause of HERA will be changed, with the rest of it remaining intact.

If you change “for cause” to “at will” and understand it is no longer an independent agency and look at https://www.law.cornell.edu/uscode/text/12/4617
Then in A(1) the director may appoint the agency as conservator, and in (2) The Agency may, at the discretion of the Director, be appointed conservator, need to be declared void ab initio and when the word director goes, so does the power

The Fifth Circuit certainly disagrees with this; if they did agree that would have been in the ruling. Once again, when you disagree with a court ruling, they win and you lose.

You’re watching another channel then we do on this board

It certainly is lonely at the top.