Fannie Mae Preferred S (FNMAS)

[Joe Stocks]

Ahhh...I think I know where Stock Analyse may have gotten the idea that I was talking about a lawsuit. I posted this on my site a couple of weeks ago. Basically it is am example of why a Fannie and Freddie shareholder association is important to take into consideration now. Try to form one quick when a decision comes down that affects us negatively? Right now we are sitting around hoping someone else will do it. I agree with RROS. Now is not the time to do it, althought I think there is a case of misuse of power with Geithner taking ALL our profits with nothing to be applied towards the principle.

Doing some research I came across this case where the United Kingdom government was involved with a shareholder owned company. The offer to the shareholders was for 70p per share. Two shareholder groups were formed and one settled for 262p to accept and not sue.

http://en.wikipedia.org/wiki/Railtrack


Liquidation

Railtrack's parent company, Railtrack Group, was placed into members’ voluntary liquidation as RT Group on 18 October 2002.[25] The Railtrack business (and its £7 billion debt) had been sold to Network Rail for £500 million, and the various diversified businesses it had created to seek to protect itself from the loss-making business of running a railway were disposed of to various buyers.[26] £370 million held by Railtrack Group was frozen at the time the company went into administration and was earmarked to pay Railtrack shareholders an estimated 70p a share in compensation. The Group's interest in the partially built High Speed 1 line was also sold for £295m.[26]
Compensation

Litigation

Railtrack shareholders formed two groups to press for increased compensation.[27] A lawyer speaking for one of those groups remarked on GMTV that his strategy was to sue the government for incorrect and misleading information given at the time Railtrack was created, when John Major was Conservative Prime Minister. An increased offer of up to 262p per share was enough to convince the larger shareholder group, the Railtrack Action Group, to abandon legal action. The Chairman, Usman Mahmud, believed that legal action would not be successful without the support of management and major shareholders.[28]
The legality of the decision to put Railtrack into railway administration was challenged by the smaller Railtrack Private Shareholders Action Group. Their action against the government alleged that the Secretary of State for Transport at the time - Stephen Byers MP - had, by deciding to cut off funding for Railtrack and asking the High Court to put the company into railway administration, committed the common law tort of misfeasance in public office.[28] It is believed that there was £532 million available to Railtrack comprising £370 million in the bank[29] and £162 million of an existing Department of Transport loan facility still available to be drawn down, but Stephen Byers MP refused to allow this, causing shareholders to believe that he had broken the loan agreement.[30]