Good Morning Kthomp,,
What are your perspectives regarding the recent Collins Opinion in the 5th Circuit:
1. Can common shareholders bring a Constitutional takings suit against the FHFA if the cramdown is implemented since it would be arguably outside the Conservator's power to "preserve and conserve"?
2. Can parties with standing challenge the FHFA affordability programs based on a MQD basis if the FHFA continues to use the GSEs as political piggy banks?
3. Doesn"t this part of the Collins Opinion directly conflict with the District Court Opinion in Bhatti regarding the scope of 4617(f)?
Here is the excerpt from Page 14 of the Opinion:
FHFA is wrong in trying to turn count I into an APA claim because Collins
specifically said that “the unconstitutional restriction on the President’s
power to remove a Director of the FHFA” is what could “inflict compen
sable harm” on plaintiffs. 141 S. Ct. at 1788–89. Count I of the complaint
was therefore properly brought directly under the Constitution and was not
barred by § 4617(f).
This analysis is buttressed by the nature of the majority opinion in
Collins. The plaintiffs brought both statutory and constitutional challenges
to the third amendment. See id. at 1775. The majority dedicated nearly four
pages to explaining why § 4617(f) barred plaintiffs’ statutory challenge to the
third amendment. See id. at 1776–79. Yet the opinion did not mention
§ 4617(f) when discussing whether plaintiffs could show that the unconsti
tutional removal restriction caused them harm. See id. at 1787–89. If
§ 4617(f) barred consideration of constitutional claims, one would expect the
opinion would have noted that. It would be strange for Collins to leave open
the possibility of retrospective relief based on an unconstitutional removal
restriction, give examples of when such relief would be available, and remand
the case for resolution of that issue if the entire question was outside our
ability to review.
Therefore, § 4617(f) does not bar count I of the amended complaint
seeking relief directly under the Constitution, and we may finally proceed to
the merits of plaintiffs’ contention that HERA’s unconstitutional removal
provision caused compensable harm.
