Replies to post #686726 on Fannie Mae-No Politics (FNMA)

[kthomp19]

The Collins case of course was just devastating but what do you think their prospects are on remand?

I don't hold out much hope on the Collins case. Technically the Fifth Circuit could mandate an NWS unwind as the remedy after all, but that would be appealed back to the Supreme Court, and their Collins ruling makes me highly doubtful that they would uphold that remedy.

The main case I am interested in here is Perry (Judge Lamberth). From what I have heard from David Thompson (high-quality name there by the way), damages would be payable to current shareholders. Lamberth made that very clear on page 17 of his opinion allowing some claims to proceed to trial:

In other words, "[w]hen a share of stock is sold, the property rights associated with the shares, including any claim for breach of those rights and the ability to benefit for any recovery or other remedy, travel with the shares." In re Activision Blizzard, Inc. S'holder Litig., 124 A.3d 1025, 1049-51 (Del. Ch. 2015). Rights associated with dividends and liquidation preferences inhere in the security.

Of course, any damages award to current shareholders would be appealed and could be overturned so this isn't anywhere close to set in stone.

My other worry there is that the damages might only be paid to the named plaintiffs as opposed to all junior pref shareholders. David Thompson supposedly said it would be the latter, but I am still looking for that quote before I consider it to be 100% true.

The 5th is traditionally a good Circuit to be in...

It was certainly the best one for shareholders, though it didn't end up mattering.