That’s true the two government agencies could strike another deal between themselves. Self serving with no regard for shareholders.
Based on the "8-0 jury verdict" against the FHFA, a deeper look reveals why this ruling is so significant and sets a crucial precedent for any potential future lawsuits regarding the conversion of the Treasury's senior preferred stock (SPS).
Higher Stakes for FHFA and Treasury: The verdict significantly increases the legal risk for the FHFA and Treasury if they were to negotiate a SPS conversion. They would have to justify that such a move was not arbitrary or unreasonable and did not unfairly harm private shareholders. Given the past finding of "arbitrary or unreasonable" behavior concerning a less drastic measure (the net worth sweep), justifying a permanent conversion of the government's entire stake would be a difficult legal undertaking.
In summary, the 8-0 jury verdict demonstrates that the FHFA's actions are not immune to judicial scrutiny, particularly when they involve altering contractual agreements with shareholders in an "arbitrary or unreasonable" way. This verdict would likely be used by shareholders to strengthen their arguments in future lawsuits over any SPS conversion.
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