Fannie and Freddie Conservator Litigation Lost Cases
Time to evaluate, so far only 12 cases are considered a loss and the merit in none of the cases was touched, Pending for resolution are 30 cases (unconsolidated) with the first one being Seila law(outside the 30) being the most important, the rights received in the 30 cases and Seila Law will travel with other cases as soon as there is an opinion on the merit of the cases
Below are all the cases lost in Fannie & Freddie conservatorship litigation that are filed by shareholders:
19-7062 (1:18-cv-01142) (18-1142) Joshua J. Angel v. BOD of FNMA,FMCC & FHFA-C ….….Preferred, Direct Previously assigned to: Honorable: Royce C. Lamberth https://www.courtlistener.com/docket/6880882/angel-v-federal-home-loan-mortgage-corporation/ Claim: Breach of quarterly BOD duties, breach of contract, breached the implied covenant of good faith and fair dealing, breach of contractual rights for dividends, Breach of implicit guaranty on Junior Preferred dividends District Court for the District of Columbia https://www.courtlistener.com/docket/26534/joshua-angel-v-federal-home-loan-mortgage-co/ On appeal Judges Henderson, Griffith and Wilkins decided Mr. Angel’s appeal without oral argument They decided april 24, 2020: “We affirm. The district court properly dismissed Angel’s initial complaint as time-barred.” “ ORDERED and ADJUDGED that the decision of the district court be AFFIRMED” CASE LOST ON: Statute Of Limitations (Angel’s claims are time-barred) http://www.glenbradford.com/wp-content/uploads/2020/04/19-7062-1839674.pdf
13-698C Arrowood Indemnity Company v. United States, Preferred Direct Judge: Margaret M. Sweeney United States Court of Federal Claims CASE LOST ON: HERA as it lacks jurisdiction (May 15, 2020 the court dismisses plaintiffs’ claims because it lacks jurisdiction to entertain their fiduciary duty and implied-in-fact-contract claims, and plaintiffs lack standing to pursue any of their claims. The court therefore GRANTS defendant’s motion to dismiss.) https://www.courtlistener.com/opinion/4754489/arrowood-indemnity-company-v-united-states/
Fannie Mae & Freddie Mac conservator Litigation, FNMA, FMCC updated June 23, 2020
19-422 Patrick J Collins v. Mnuchin (Pending petition SCOTUS) .…Common & Preferred, Derivative Claim: “for cause” separation of powers §?4512(b)(2) https://www.scotusblog.com/case-files/cases/collins-v-mnuchin/ (Decided according to David Thompson 1 week after resolution in Seila Law, ~first week of july-2020) 19-563 Mnuchin v. Patrick J Collins (Pending petition SCOTUS)…….Relates to all cases Claim: § 4617(f) prevents ruling on 3th amendment, § 4617(b)(2)(A) (i) forbids challenging the Third Amendment (Decided according to David Thompson 1 week after resolution in Seila Law, ~first week of july-2020) https://www.scotusblog.com/case-files/cases/mnuchin-v-collins/
(13-1025 (1:13-cv-01025-RCL), 14-5243) Perry Capital LLC v. Jacob Lew......Common & Preferred, Derivative CLAIM: Derivative APA, 3th amendment District Court, District of Columbia Judge: Royce C. Lamberth https://www.courtlistener.com/docket/4212073/perry-capital-llc-v-lew/ https://www.courtlistener.com/docket/3054444/perry-capital-llc-v-jacob-lew/ Court of Appeals for the D.C. Circuit On appeal before Judge: Brown, Millett, Ginsburg Consolidated with: 1:13-cv-01053, 14-5254(fairholme) 1:13-cv-01439, 14-5260 (Arrowood), 1:13-cv-01288, 14-5262 (In re: Fannie Mae/Freddie Mac Senior) 02/21/2017 following claims are remanded to the district court for further proceedings. 1) breach of contract and breach of the implied covenant of good faith and fair dealing regarding liquidation preferences 2) and the claim for breach of the implied covenant with respect to dividend rights, which claims we remand (to Lamberth) for further proceedings consistent with this opinion https://www.govinfo.gov/content/pkg/USCOURTS-caDC-14-05243/pdf/USCOURTS-caDC-14-05243-1.pdf
13-1288 (1:13-mc-01288) In re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase Agreement Class Action Litigations ………………………… Common & Preferred, Class Action, Direct & Derivative Honorable: Royce C. Lamberth District Court for the District of Columbia Plaintiffs demand a Trial by Jury Direct claim, breaches of contract, breaches of the implied covenant of good faith and fair dealing, breaches of fiduciary duties, and violations of Delaware and Virginia law governing dividends If the Direct claims are denied it also claims these Derivative: breaches of fiduciary duty, compensatory damages and disgorgement, breached the terms of the certificates of designation and the implied covenant of good faith and fair dealing, appropriate equitable and injunctive relief to remedy breaches of contract, breaches of the implied covenant of good faith and fair dealing, breaches of fiduciary duty, and violations of Delaware and Virginia Corporate law, including rescission of the Third Amendment. https://www.courtlistener.com/recap/gov.uscourts.dcd.163155/gov.uscourts.dcd.163155.71.0.pdf https://www.courtlistener.com/docket/4212341/in-re-fannie-maefreddie-mac-senior-preferred-stock-purchase-agreement/ The Class: 1) N. Bradford Isbell ....... Common 2) Michelle M. Miller ...... Common 3) Charles Rattley ………… Common 4) Timothy J. Cassell ...... Common 5) 111 John Realty Corp… Preferred 8) United Equities Commodities Com ….. Preferred 6) 1:13-cv-01149 Joseph Cacciapalle ..... Preferred 7) 1:13-cv-01421 Marneu Holdings, Co .. Preferred 9) 1:13-cv-01169 American European Insurance Co ... Preferred 10) 1:13-cv-01443 Barry P. Borodkin ....... Preferred 11) 1:13-cv-01094 Mary Meiya Liao ....... Preferred https://www.courtlistener.com/docket/4212341/in-re-fannie-maefreddie-mac-senior-preferred-stock-purchase-agreement/ Fact discovery was to close on April 30, 2020, Trial was set for March 31, 2021 (with a pretrial 30-60 days before) May 9, 2020 - The deadlines in the Second Amended Scheduling Order are hereby adjourned pending further order of this Court, The parties are directed to submit proposed amended deadlines no later than June 30, 2020. https://www.courtlistener.com/recap/gov.uscourts.dcd.160910/gov.uscourts.dcd.160910.118.0.pdf
13-1439 (1:13-cv-01439) Arrowood Indemnity Company v. Fannie Mae……Preferred....Direct & Derivative Honorable: Royce C. Lamberth Claim: 3th amendment, breach of fiduciary duty, breach of contract, breach of the implied covenant of good faith and fair dealing District Court for the District of Columbia https://www.courtlistener.com/docket/6995674/arrowood-indemnity-company-v-federal-national-mortgage-association/ Fact discovery was to close on April 30, 2020, Trial was set for March 31, 2021 (with a pretrial 30-60 days before) May 9, 2020 - The deadlines in the Second Amended Scheduling Order are hereby adjourned pending further order of this Court, The parties are directed to submit proposed amended deadlines no later than June 30, 2020. https://www.courtlistener.com/recap/gov.uscourts.dcd.160910/gov.uscourts.dcd.160910.118.0.pdf
16-3113 (4:16-cv-03113)( 17-20364) Patrick J Collins v. Lew …………………….…Common & Preferred, Derivative Honorable: Judge Nancy F Atlas in District Court Claim: “for cause” separation of powers §?4512(b)(2) https://www.courtlistener.com/docket/4533994/collins-v-lew/ Court of Appeals for the Fifth Circuit: https://www.courtlistener.com/docket/6179579/patrick-collins-v-steven-mnuchin-secretary/ III. CONCLUSION http://www.ca5.uscourts.gov/opinions/pub/17/17-20364-CV0.pdf https://www.courtlistener.com/pdf/2018/07/16/patrick_collins_v._steven_mnuchin_secretar.pdf We AFFIRM the district court’s order granting the Agencies’ motions to dismiss the Shareholders’ APA claims because such claims are barred by 12 U.S.C. § 4617(f).(no court may take any action) We REVERSE the district court’s order granting the Agencies’ motion for summary judgment regarding the Shareholders’ claim that the FHFA is unconstitutionally structured in violation of Article II and the Constitution’s separation of powers, and we REMAND to the district court with instructions to enter judgment declaring the “for cause” limitation on removal of the FHFA’s Director found in 12 U.S.C. § 4512(b)(2) violates the Constitution’s separation-of-powers principles. The 5th circuit remanded this back to Judge Nancy F Atlas in District Court, S.D. Texas, after a decision in Seila Law it will proceed (~first week of july-2020)
18-3478 (2:18-cv-03478) Wazee Street Opportunities v. United States………Common, Class action, Derivative Honorable: Nitza I Quinones Alejandro Claim: voiding 3th amendment & “for cause” separation of powers District Court, E.D. Pennsylvania https://www.courtlistener.com/docket/7681282/wazee-street-opportunities-fund-iv-lp-v-the-federal-housing-finance-agency/ Waiting on Collins as document 38 says Supplemental authority filed by Defendant ….. in the matter of Collins v. Mnuchin, No. 17-20364, now 19-422 / 19-563)
----------------------------------------------------------------- Cases in Sweeney’s U.S. Court of Federal Claims -----------------------------------------------------------------
20-121 (20-122) (13-465C) (1:13-cv-00465) (17-1122)(17-104) Fairholme Funds, Inc. v. United States………..Common & Preferred, Direct & Derivative Honorable: Margaret M. Sweeney United States Court of Federal Claims https://www.courtlistener.com/docket/4198608/fairholme-funds-inc-v-united-states/ Claim: **SEALED** 413 AMENDED COMPLAINT (Entered: 03/08/2018) Redacted version without coercion attacks available at: https://www.docketbird.com/court-documents/Fairholme-Funds-Inc-et-al-v-USA/REDACTED-DOCUMENT-filed-by-ACADIA-INSURANCE-COMPANY-ADMIRAL-INDEMNITY-COMPANY-ADMIRAL-INSURANCE-COMPANY-ANDREW-T-BARRETT-BERKLEY-INSURANCE-COMPANY-BERKLEY-REGIONAL-INSURANCE-COMPANY-CAROLINA-CASUALTY-INSURANCE-COMPANY-CONTINENTAL-WESTERN-INSURANCE-CO/cofc-1:2013-cv-00465-00422 March 9, 2020 the interlocutory appeal was granted the CFC identified six “controlling questions of law” raised by its order, the first three of which pertain to the CFC’s decision to dismiss Petitioners’ direct claims: (1) Whether the court lacks subject-matter jurisdiction over plaintiffs’ direct claims for breach of fiduciary duty and breach of implied-in-fact contracts. (2) Whether plaintiffs who purchased stock in Fannie and Freddie after the PSPA amendments lack standing to pursue their direct claims. (3) Whether plaintiffs lack standing to pursue their self-styled direct claims because those claims are substantively derivative in nature. The last three controlling questions identified by the CFC related to its decision to deny the motion to dismiss Petitioners’ derivative claims: (4) Whether plaintiffs have standing to assert derivative claims notwithstanding HERA’s succession clause. (Fairholme & Fisher) (5) Whether the [FHFA-as-conservator’s] actions are attributable to the United States such that the court possesses subject-matter jurisdiction to entertain plaintiffs’ derivative takings and illegal exaction claims. (Fairholme & Fisher) (6) Whether plaintiffs’ allegations that the FHFA entered into an implied-in-fact contract with the Enterprises to operate the conservatorships for shareholder benefit fail as a matter of law. http://www.glenbradford.com/wp-content/uploads/2020/03/20-121-0002.pdf By no later than 14 days after the completion of that process (interlocutory appeal), the parties shall file a joint status report in which they propose further proceedings, if any are necessary.
The following List Of Fannie Mae and Freddie Mac Shareholder Suits are Pending In The Court Of Federal Claims awaiting a decision in the Fairholmes interlocutory appeal, with below each group their stand on the interlocutory appeal, and further replies
4) 13-385C Washington Federal v. United States . Common & Preferred, Class Action, Direct* https://www.courtlistener.com/docket/4198605/washington-federal-v-united-states/ April 2, 2020 Plaintiff argues None of the claims in Fairholme apply to their case April 16, 2020 the government thinks: a) Fannie Mae And Freddie Mac Shareholders Lack Standing To Assert Substantively-Derivative Claims As Direct Claims b) The Court Lacks Jurisdiction To Review The Merits Of The Enterprises’ Placement In Conservatorship c) The Washington Federal Plaintiffs May Not Pursue Derivative Claims
5) 13-608C Bryndon Fisher (FNMA) .........….. Common Derivative* https://www.courtlistener.com/docket/4198614/fisher-v-united-states/ June 11, 2020 interlocutory appeal process Granted on following (1) Whether plaintiffs have standing to assert derivative claims notwithstanding HERA’s succession clause. (question 4 in fairholme) (2) Whether the FHFA-C’s actions are attributable to the United States such that the court possesses subject-matter jurisdiction to entertain plaintiffs’ derivative takings and illegal exaction claims. (question 5 in fairholme) 6) 14-152C Bruce Reid (FMCC) …………………… Common Derivative* https://www.courtlistener.com/docket/7737030/reid-v-united-states/ May 18, 2020 Fisher/Reid file motion to certify interlocutory appeal June 4, 2020 Fairholme plaintiffs’ amicus brief in support of neither party 7) 13-672C Erick Shipmon……..…………………… Common Derivative https://www.courtlistener.com/docket/4198615/shipmon-v-united-states/ March 27, 2020 above 3 Plaintiff’s think their claim is substantially the same as Fairholme’s April 7, 2020 TRANSCRIPT of proceedings held on March 5, 2020 before Chief Judge Margaret M. Sweeney. Total No. of Pages: 1-77. Release of Transcript Restriction set for 7/6/2020.
8) 13-698C Arrowood Indemnity Company . Preferred Direct* April 6, 2020 Plaintiff’s think none of the Fairholme counts apply to their case May 15, 2020 the court dismisses plaintiffs’ claims because it lacks jurisdiction to entertain their fiduciary duty and implied-in-fact-contract claims, and plaintiffs lack standing to pursue any of their claims. The court therefore GRANTS defendant’s motion to dismiss. May 15, 2020 waiting on appeal
10) 18-281C Owl Creek Asia I L.P...........………. Preferred, Direct * 11) 18-369C Akanthos Opportunity Master Fund .. Preferred, Direct * 12) 18-370C Appaloosa Investment .........……. Preferred, Direct * 13) 18-371C CSS LLC ……………………………………. Preferred, Direct * 14) 18-529C Mason Capital L.P...........………….. Preferred, Direct * March 26, 2020 above 5 plaintiffs don’t want to give up the direct claims and doubt the counts in Fairholme properly represent their counts, and point out the law was breached June 8, 2020 again a very damaging ruling for the government but still the case is dismissed as: (FHFA can) “take any action authorized by [12 U.S.C. § 4617(b)), which (it) determines is in the best interest of the (Enterprise) or the (FHFA)(Itself) .” http://www.glenbradford.com/wp-content/uploads/2020/06/18-00281-0064.pdf June 18, 2020 Owl creek files for appeal for ECF 64 for the Court of Appeals for the Federal Circuit June 18, 2020 Fairholme and Owl Creek entered their appeal, Fairholme’s appeal will be designated as the lead appeal http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/20-121.ORDER.6-18-2020_1605834.pdf
15) 18-1124C Wazee Street……………….………… Common, Class Action, Direct & Derivative 16) 18-1150C Highfields Capital………………….. Common & Preferred, Direct https://www.pacermonitor.com/public/case/25303845/HIGHFIELDS_CAPITAL_I_LP_et_al_v_USA Related To: Fairholme, Arrowood, Cacciapalle, 13-469, Dennis, Wazee Street, Fisher, Shipmon, Reid, Rafter, Owl Creek, Appaloosa, Akanthos, Css, Mason, 683 Cap. Partners, Patt 17) 18-711C 683 Capital Partners………..……….. Common, Preferred, Direct 18) 18-712C Joseph S. Patt………………………..… Preferred, Direct 19) 18-1226C Perry Capital LLC……………………. Common & Preferred, Direct & Derivative 20) 18-1155C CRS Master Fund LP…..…………… Preferred, Direct Above 6 Plaintiffs are staying
21) 18-1240C Quinn Opportunities Master LP … Preferred, Direct May 19, 2020 - Status unknown * Jones Days plaintiffs
Sisti v. Federal Housing Finance Agency Case number: 17-005 (90-1762)(17-042) Honorable: John James McConnell, Jr District Court, D. Rhode Island Claim: FHFA, Fannie Mae, and Freddie Mac are government entities https://www.courtlistener.com/docket/6900150/sisti-v-federal-housing-finance-agency/ March 24, 2020 Stipulation ~Until - Set Scheduling Order Deadlines The Parties report to the Court that they are currently re-engaged in negotiations aimed at resolving the action. In order to afford the Parties with sufficient time to complete these discussions and discovery (if necessary), the Parties jointly request the Court extend the scheduling order deadlines by three (3) months to the following: Factual Discovery to close by 6/30/2020; Plaintiff's Expert Disclosures shall be made by 7/30/2020; Defendants' Expert Disclosures shall be made by 8/28/2020; Expert Discovery to close by 9/30/2020; and Dispositive Motions due by 10/30/2020. https://www.courtlistener.com/recap/gov.uscourts.rid.41482/gov.uscourts.rid.41482.53.0.pdf When decided FHFA, FNMA and FMCC are government entities for matters of constitutional claims of due process and will confirm or not the paragraph nobody can take action while in conservatorship. https://ecf.rid.uscourts.gov/cgi-bin/show_public_doc?2017cv0005-39
Seila law v. Consumer Financial Protection bureau (CFPB) Decision in the last 2 weeks of June 2020 Case number: 19-7 (17-56324) Court: Supreme Court of the United States Issues: (1) Whether the vesting of substantial executive authority in the Consumer Financial Protection Bureau, an independent agency led by a single director, violates the separation of powers; and (2) whether, if the Consumer Financial Protection Bureau is found unconstitutional on the basis of the separation of powers, 12 U.S.C. §5491(c)(3) can be severed from the Dodd-Frank Act. https://www.scotusblog.com/case-files/cases/seila-law-llc-v-consumer-financial-protection-bureau/ Transcript of argument on Tuesday, March 3, 2020. https://www.supremecourt.gov/oral_arguments/argument_transcripts/2019/19-7_j4ek.pdf Audio: https://www.oyez.org/cases/2019/19-7 1) Questions asked by plaintiff: for cause violates the separation of powers 2) The Court added a second question: can for cause be severed from Dodd-Frank Act Plaintiff and the government agree on the first question that “for cause” violates the constitution, but disagree on the second question Plaintiff contends reverse the judgment and either decline to reach the question of severability or declare it is not severable. The government argues that the Court should remand for further proceedings. (The decision in this case will decide on Collins SCOTUS 19-422 “backward-looking relief” witch the 5th circuit en banc declined) Key takeaway: 1) Independent agency 2) Headed by a single director 3) Funded thru the Federal reserve Systems earnings (Rather than through annual appropriations) 4) Days away from a ruling
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