FNMA and FMCC preferreds. In search of the elusive 10 bagger.

[merkhet]

Man, my degrees are paying off some today.

 

Two things.

 

(1) One of my former mentees from law school responded to my inquiry about the MDL. He's done some work concerning the MDL before, and he says that while he hasn't encountered the specific question of whether cases are stayed pending the MDL decision, there is no automatic stay. Now, of course, Defendants can request such a stay, but it would be up to the individual courts to grant such a motion for a stay.

 

(2) The Perry Appeal has been assigned to Judges Brown, Millet & Ginsburg. I know less about the last two, but Judge Brown is a hard core libertarian who believes all rights come from property rights. Take a look at her wiki page -- https://en.m.wikipedia.org/wiki/Janice_Rogers_Brown#Political_views. We literally could not ask for a better judge to be on the panel. Also, a friend of mine is currently clerking on the DC District Court of Appeals, so I'm going to try and schedule coffee with him when I get back from vacation in a few days to feel him out on the other two judges. I'd heard of them, but I don't have a great sense of their judicial views.

[hardincap]

Brown's speech mentioned Ayn Rand and lamented the triumph of "the collectivist impulse", in which capitalism receives "contemptuous tolerance but only for its capacity to feed the insatiable maw of socialism." She argued that "where government moves in, community retreats, civil society disintegrates, and our ability to control our own destiny atrophies," and suggests that the ultimate result for the United States has been a "debased, debauched culture which finds moral depravity entertaining and virtue contemptible".

 

;D

[TwoCitiesCapital]

Brown's speech mentioned Ayn Rand and lamented the triumph of "the collectivist impulse", in which capitalism receives "contemptuous tolerance but only for its capacity to feed the insatiable maw of socialism." She argued that "where government moves in, community retreats, civil society disintegrates, and our ability to control our own destiny atrophies," and suggests that the ultimate result for the United States has been a "debased, debauched culture which finds moral depravity entertaining and virtue contemptible".

 

;D

 

I'm gonna buy more.....

 

lol

[Guest cherzeca]

Man, my degrees are paying off some today.

 

Two things.

 

(1) One of my former mentees from law school responded to my inquiry about the MDL. He's done some work concerning the MDL before, and he says that while he hasn't encountered the specific question of whether cases are stayed pending the MDL decision, there is no automatic stay. Now, of course, Defendants can request such a stay, but it would be up to the individual courts to grant such a motion for a stay.

 

(2) The Perry Appeal has been assigned to Judges Brown, Millet & Ginsburg. I know less about the last two, but Judge Brown is a hard core libertarian who believes all rights come from property rights. Take a look at her wiki page -- https://en.m.wikipedia.org/wiki/Janice_Rogers_Brown#Political_views. We literally could not ask for a better judge to be on the panel. Also, a friend of mine is currently clerking on the DC District Court of Appeals, so I'm going to try and schedule coffee with him when I get back from vacation in a few days to feel him out on the other two judges. I'd heard of them, but I don't have a great sense of their judicial views.

 

cant offer too much insight on ginsberg other than to say my wife did research for him when he was a HLS prof and she thought he was extremely nice.  you will recall that he was up for SCOTUS (nominated by reagan) but had to withdraw because he smoked weed in high school....times have changed

 

EDIT:  ginsberg was assnt atty gen for anti-trust after leaving HLS (where he taught antitrust).  part of my fear with judges is that their eyes will glaze over when financial transactions are adjudicated (outside of 2nd cir).  at least ginsberg is very well versed in economics and transactional matters.  millet was a partner at akin gump (biglaw dc firm) leading its appellate practice, after years working in the solicitor general's office, so at least she he had some exposure to representing private parties aggrieved by govtal action (whether she is pro-govt due to her Sol Gen office stint is hard to say.  after all, Ted Olson was Sol Gen and will be arguing for Perry). and brown is an ayn rand acolyte, so nothing more need be said about her.  so it seems like as good a panel from plaintiffs' perspective as one could reasonably hope.

 

SECOND EDIT:  brown's speech to the federalist society (2000) is a MUST READ:  https://web.archive.org/web/20031103060347/http://www.constitution.org/col/jrb/00420_jrb_fedsoc.htm

[merkhet]

So I've been doing some research this morning on Judge Douglas Ginsburg. Here's what I've found:

 

http://blogs.law.nyu.edu/magazine/2011/introducing-douglas-h-ginsburg/

 

A self-described originalist, Ginsburg coined the term “Constitution in exile” to refer to decisions when the canon has not been interpreted as originally intended. “No one would put on a Shakespeare play without trying to understand what the words meant 400 years ago,” he explains.

 

Although he is regarded as a conservative, his clerks and other lawyers say he is not an ideologue. “When deciding a case, he makes an honest assessment of the facts in front of him and the governing law. He doesn’t bend the case to become a piece of advocacy for a conservative agenda,” says former clerk David Lehn ’04. On the bench, he asks penetrating questions but is always courteous.

 

Note that originalism and textualism are not quite the same. Arguably, Lamberth examined things in a (half-assed) textualist way while originalism seeks to interpret laws in a fixed context.

 

http://www.law.nyu.edu/news/douglas-ginsburg-2015-hayek-lecture

 

In his October 15 Hayek Lecture, co-sponsored by the Classical Liberal Institute (CLI) and the NYU Journal of Law & Liberty, Ginsburg responded pointedly: “My purpose is not to defend my court or any decision I participated in…but rather to remind the Harvard team of just what administrative law is and is meant to do.” Returning to the foundational Administrative Procedure Act (APA) of 1946, which sets out the procedural guidelines for administrative agencies, Ginsburg cast it as grounded in “classical liberal tradition,” saying it “emphasizes limited government, checks and balances, and a strong protection of individual rights.”

 

But speaking from his position in the DC Circuit, which hears most of the challenges to agency actions brought under the APA, he argued that administrative law has, over the past several decades, drifted far from the APA’s classical liberal goals. The problem in administrative law does not lie with judicial ideologues, he concluded, but with “doctrines of extreme deference by which the Supreme Court has relieved the judiciary in all but the most egregious cases of its responsibility to provide meaningful review.”

 

As an example of how difficult it has become for the judiciary to check what the Supreme Court once deemed “administrators whose zeal might otherwise have carried them to excesses not contemplated in legislation creating their offices,” he cited Michigan v. Environmental Protection Agency (EPA). The EPA, Ginsburg said, had ignored the costs of new power plant regulations estimated at $9.6 billion a year, with the quantifiable benefits only totaling $4-6 million a year: “That’s 1/2000th of the difference.” The DC Circuit upheld the agency’s policy, drawing on the so-called Chevron deference established in the 1984 landmark case, which holds that agencies, not the courts, are free to interpret ambiguous statutes. Yet Ginsburg supported the dissent’s claim that the EPA had failed in simple common sense by not taking costs into account.

 

The Supreme Court later overturned the lower court’s ruling, but Ginsburg was disappointed by the five-to-four split: “This should not have been a close case.” For him, Michigan v. EPA amounted to that rare instance in which the Supreme Court did not blindly defer to agency discretion to interpret congressional statutes. The closeness of the vote, he said, suggested how unwilling the Court has become to rule against agency overreach.

 

In addition to Chevron deference, other practices troubling Ginsburg included the ability of agencies to circumvent submitting new ideas to public discussion by presenting them as policy statements, and judicial presumption that the government is acting in good faith when individuals bring cases against it. “None of them arises from the APA itself,” he said, and all contribute to a “legal regime that insulates agencies from correction.”

 

“The marginalization of the courts in contemporary administrative law,” said Ginsburg, “should be a concern to all who believe in our liberal tradition and an independent judiciary providing a check on executive discretion with the simple duty of saying what the law is.”

 

http://www.hks.harvard.edu/index.php/content/download/70574/1255106/version/1/file/RPP_2014_22_Sunstein.pdf

 

The first involved the reach of the national government. In Judge Ginsburg’s view, the Court employed “loose reasoning” and indulged in “a stark break from precedent” in upholding the National Labor Relations Act. In his view, the Court thereby expanded congressional power under the Commerce Clause in a way that fit awkwardly, and perhaps not at all, with the Constitution as written. Second, the Court allowed administrative agencies to wield broad discretionary power, thus violating the nondelegation doctrine as embodied in Article 1, section 1. Citing the Court’s validation of a provision of the Clean Air Act that appears to grant broad discretion to the Environmental Protection Agency, Judge Ginsburg urged that the “structural constraints in the written Constitution have been disregarded.” Third, he contended that the Court has “blinked away” central provisions of the Bill of Rights. As a particular example, he referred to the Takings Clause, which, he lamented, has been read to provide “no protection against a regulation that deprives people of most of the economic value of their property.” It seems clear that Judge Ginsburg believes that properly interpreted, the Takings Clause would provide much stronger protection of property rights than it now does.

 

For Judge Brown, the upshot is that “the economic convulsions of the late 1920's and early 1930's . . . . consumed much of the classical conception of the Constitution.” Notably, and with a judgment that overlaps with that of Judge Ginsburg, she contends that “[p]rotection of property was a major casualty of the Revolution of 1937.” As a result, it “became government's job not to protect property but, rather, to regulate and redistribute it.” In the current era, moreover, “there are even deeper movements afoot. Tectonic plates are shifting and the resulting cataclysm may make 1937 look tame.” Needless to say, this statement was meant as a warning.

 

Judge Brown went further still. Speaking of government authority, she said, "[W]e no longer find slavery abhorrent. We embrace it." She also cautioned, "If we can invoke no ultimate limits on the power of government, a democracy is inevitably transformed into a kleptocracy - a license to steal, a warrant for oppression."

 

Brown attempted to connect her economic libertarianism with a version of the original understanding:

 

This standard [rational-basis review of economic regulation] is particularly troubling in light of the pessimistic view of human nature that animated the Framing of the Constitution—a worldview that the American polity and its political handmaidens [sic] have, unfortunately, shown to be largely justified. See James Madison, Notes of Debates in the Federal Convention of 1787, at 39, 42 (W.W. Norton & Co. 1987). Moreover, what the Framers theorized about the destructive potential of factions (now known as special or group interests), experience has also shown to be true. The Federalist No. 10, at 78, 81 (James Madison) (Clinton Rossiter ed., 1961). The judiciary has worried incessantly about the "countermajoritarian difficulty" when interpreting the Constitution. But the better view may be that the Constitution created the countermajoritarian difficulty in order to thwart more potent threats to the Republic: the political temptation to exploit the public appetite for other people's money—either by buying consent with broad-based entitlements or selling subsidies, licensing restrictions, tariffs, or price fixing regimes to benefit narrow special interests.

 

In this vision, the “countermajoritarian Constitution” enforced by searching judicial review protects the public interest from both broad-based entitlements that corrupt the citizenry, and also from exploitation by narrow special interests, whereas “[r]ational basis review means property is at the mercy of the pillagers.”

 

The relevant line of decisions began, at the latest, with Chamber of Commerce v. SEC in 2005. The SEC required that “in order to engage in certain transactions otherwise prohibited by the [investment Company Act], an investment company — commonly referred to as a mutual fund — must have a board (1) with no less than 75% independent directors and (2) an independent chairman.” The panel -- in an opinion by Judge Douglas Ginsburg, whose views on the “Constitution in Exile” we have seen earlier, and who would later author Business Roundtable -- invalidated the regulation on the ground that the agency had declared certain costs unquantifiable. The agency had discussed the costs, explained the attendant uncertainty, and stated that it had no reliable basis for estimating the costs quantitatively, but decided to proceed on the basis of an overall judgment that the regulation would do more good than harm. The panel, in an ambiguous discussion, seemed to suggest that the agency had a statutory duty to make “tough choices” by “hazarding a guess” and “do[ing] what it can.” This seemed to require a quantified guesstimate, insofar as feasible. The legal basis for this judicially-imposed requirement, however, was left unstated. As we will see shortly, Chamber of Commerce v. SEC was a first effort in the direction of the obligation eventually imposed, in a more general form, by Business Roundtable -- a presumptive agency obligation to quantify costs and benefits insofar as possible.

 

The article is clearly written by Sunstein as an opprobrium on the United States Court of Appeals for the District of Columbia, and, in particular Judges Brown & Ginsburg, but it seems like he is indicating that they would be both be favorably inclined in our case. Moreover, there is a section where Sunstein mentions that both of these judges tend to rule in ways that validate their extrajudicial views of a libertarian administrative law framework.

 

http://www.law.georgetown.edu/academics/law-journals/gjlpp/upload/zs800112000001.pdf

 

Notwithstanding the gentle nudge implied by a Lifetime Service Award, I appreciate the sentiment and am indeed honored to be here, in particular because of the people who have received this recognition before, including my teachers, Richard Epstein and Richard Posner, my former boss and booster Edwin Meese, my colleague Larry Silberman and former colleague Ken Starr, and my friend, Ted Olson. These are hard acts to follow.

 

I do not think I would want to argue in front of Ginsburg & Brown as the government in this case.

[Guest cherzeca]

@merkhet

 

great stuff.  thanks for the research!

[hardincap]

@merkhet

 

great stuff.  thanks for the research!

 

+1. Some of those quotes...wow

[merkhet]

@merkhet

 

great stuff.  thanks for the research!

 

Thank my fiancée for her infinite patience while waiting for me to finish that research/post while we are on vacation in Malaysia. :)

 

Side note: I highly recommend that people visit Kuala Lumpur. This city is fantastic.

[Guest cherzeca]

tidbit about Millet: 

 

"In August 1996, Millett became an assistant to the United States Solicitor General, a position she held until September 2007."

 

it is expected that ted olson will argue on behalf of perry.  "Olson was nominated for the office of Solicitor General by President Bush on February 14, 2001, was confirmed by the United States Senate on May 24, 2001, and took office on June 11, 2001. In July 2004, Olson retired as Solicitor General and returned to private practice at the Washington office of Gibson Dunn."

 

so for three years, olson was millet's boss.

[merkhet]

tidbit about Millet: 

 

"In August 1996, Millett became an assistant to the United States Solicitor General, a position she held until September 2007."

 

it is expected that ted olson will argue on behalf of perry.  "Olson was nominated for the office of Solicitor General by President Bush on February 14, 2001, was confirmed by the United States Senate on May 24, 2001, and took office on June 11, 2001. In July 2004, Olson retired as Solicitor General and returned to private practice at the Washington office of Gibson Dunn."

 

so for three years, olson was millet's boss.

 

Hahaha. This panel of judges is shaping up to be a murderer's row!

[muscleman]

From GSELinks:

The Panel directed today that:

-- Appearances are due on or before Mar. 30, 2016;

-- Corporate disclosure statements must be filed on or before Mar. 30, 2016; and

-- Responses to FHFA's Motion to Transfer must be filed on or before Apr. 6, 2016.

If the parties move quickly, the Panel may be able to consider FHFA's Motion to Transfer at its hearing scheduled for May 26, 2016, in Chicago. If that date doesn't work, the Panel's next bi-monthly hearing will be held on July 28, 2016, in Seattle."

 

 

I bet after the hearing, there will be all other kinds of arguments, so the delay is at least 5-6 months.

[Guest cherzeca]

ginsberg's seminal articles on administrative law:  http://object.cato.org/sites/cato.org/files/serials/files/regulation/1995/1/v18n1-9.pdf and https://www.law.upenn.edu/journals/conlaw/articles/volume12/issue2/Ginsberg-Menashi12U.Pa.J.Const.L.251(2010).pdf

[Guest cherzeca]

from merkhet 08:25:49 PM  "The article is clearly written by Sunstein as an opprobrium on the United States Court of Appeals for the District of Columbia, and, in particular Judges Brown & Ginsburg, but it seems like he is indicating that they would be both be favorably inclined in our case. "

 

for the probability stats geeks among us:

 

now, while brown and ginsburg are not the only two "conservative" judges on the dc circuit. nonetheless given that the merits panel has 3 judges and there are 17 judges to choose a panel from, what are the chances that a panel with those two judges on it would be selected?

 

[spits 3 times]

[merkhet]

http://law.justia.com/cases/federal/appellate-courts/F3/412/133/544710/

 

I would note that the discussion of Chamber of Commerce vs. SEC was pretty interesting in that Judge Ginsburg found that the SEC did not do enough to justify its actions despite having been able to show that it did do some things to satisfy the APA.

 

One wonders what Justice Ginsburg will think of an administrative agency's (A) inability to produce an administrative record and (B) lying as to what it did or did not consider in making its decisions.

[onyx1]

I generally try to avoid repeating myself but in this instance it's warranted.

 

 

Big thanks merkhet and cherzeca for your insightful posts!

[Guest cherzeca]

http://law.justia.com/cases/federal/appellate-courts/F3/412/133/544710/

 

I would note that the discussion of Chamber of Commerce vs. SEC was pretty interesting in that Judge Ginsburg found that the SEC did not do enough to justify its actions despite having been able to show that it did do some things to satisfy the APA.

 

One wonders what Justice Ginsburg will think of an administrative agency's (A) inability to produce an administrative record and (B) lying as to what it did or did not consider in making its decisions.

 

after reading ginsberg's nonjudicial writing on administrative law, i believe that he will be very probing of fhfa/treasury, not deferential. 

[muscleman]

from merkhet 08:25:49 PM  "The article is clearly written by Sunstein as an opprobrium on the United States Court of Appeals for the District of Columbia, and, in particular Judges Brown & Ginsburg, but it seems like he is indicating that they would be both be favorably inclined in our case. "

 

for the probability stats geeks among us:

 

now, while brown and ginsburg are not the only two "conservative" judges on the dc circuit. nonetheless given that the merits panel has 3 judges and there are 17 judges to choose a panel from, what are the chances that a panel with those two judges on it would be selected?

 

[spits 3 times]

 

Well that depends on whether the judges are randomly chosen or the plaintiffs and defendants can appoint them. If not randomly chosen, the probability is very hard to calculate.

[Guest cherzeca]

from merkhet 08:25:49 PM  "The article is clearly written by Sunstein as an opprobrium on the United States Court of Appeals for the District of Columbia, and, in particular Judges Brown & Ginsburg, but it seems like he is indicating that they would be both be favorably inclined in our case. "

 

for the probability stats geeks among us:

 

now, while brown and ginsburg are not the only two "conservative" judges on the dc circuit. nonetheless given that the merits panel has 3 judges and there are 17 judges to choose a panel from, what are the chances that a panel with those two judges on it would be selected?

 

[spits 3 times]

 

Well that depends on whether the judges are randomly chosen or the plaintiffs and defendants can appoint them. If not randomly chosen, the probability is very hard to calculate.

 

i have read that it is random, using a process that court wont disclose

 

EDIT:  found the link:  http://www.law.du.edu/images/uploads/neutral-assignment/Neutral_assignment_links.pdf (15 years old so process might have changed)

[A_Hamilton]

Federal courts randomly assign UNLESS it is an organized crime case. Then, there is a specific federal judge who has accepted that duty and he/she receives 365 24/7 protection from the U.S. Marshal's service.

[muscleman]

from merkhet 08:25:49 PM  "The article is clearly written by Sunstein as an opprobrium on the United States Court of Appeals for the District of Columbia, and, in particular Judges Brown & Ginsburg, but it seems like he is indicating that they would be both be favorably inclined in our case. "

 

for the probability stats geeks among us:

 

now, while brown and ginsburg are not the only two "conservative" judges on the dc circuit. nonetheless given that the merits panel has 3 judges and there are 17 judges to choose a panel from, what are the chances that a panel with those two judges on it would be selected?

 

[spits 3 times]

 

Well that depends on whether the judges are randomly chosen or the plaintiffs and defendants can appoint them. If not randomly chosen, the probability is very hard to calculate.

 

i have read that it is random, using a process that court wont disclose

 

EDIT:  found the link:  http://www.law.du.edu/images/uploads/neutral-assignment/Neutral_assignment_links.pdf (15 years old so process might have changed)

 

In this case the chance is 1 out of 289. However I assume there are other judges that will also believe in law.  :) And I still have hope in the US and believe Lamberth is a rare beast in the US judicial system.

 

In other countries like Russia and China, most judges are like Lamberth. The government is always right, no matter what it does.

[doughishere]

Federal courts randomly assign UNLESS it is an organized crime case. Then, there is a specific federal judge who has accepted that duty and he/she receives 365 24/7 protection from the U.S. Marshal's service.

 

Thats actually pretty awesome. Mad respek to who ever takes on that job.

 

http://imgur.com/rOx6kLP

[Guest cherzeca]

from merkhet 08:25:49 PM  "The article is clearly written by Sunstein as an opprobrium on the United States Court of Appeals for the District of Columbia, and, in particular Judges Brown & Ginsburg, but it seems like he is indicating that they would be both be favorably inclined in our case. "

 

for the probability stats geeks among us:

 

now, while brown and ginsburg are not the only two "conservative" judges on the dc circuit. nonetheless given that the merits panel has 3 judges and there are 17 judges to choose a panel from, what are the chances that a panel with those two judges on it would be selected?

 

[spits 3 times]

 

Well that depends on whether the judges are randomly chosen or the plaintiffs and defendants can appoint them. If not randomly chosen, the probability is very hard to calculate.

 

i have read that it is random, using a process that court wont disclose

 

EDIT:  found the link:  http://www.law.du.edu/images/uploads/neutral-assignment/Neutral_assignment_links.pdf (15 years old so process might have changed)

 

In this case the chance is 1 out of 289. However I assume there are other judges that will also believe in law.  :) And I still have hope in the US and believe Lamberth is a rare beast in the US judicial system.

 

In other countries like Russia and China, most judges are like Lamberth. The government is always right, no matter what it does.

 

thanks MM

 

in addition to brown and ginsberg, kavanaugh would have been favorable, but not any other particular judge to my knowledge

 

1 out of 289?  i'll take those odds    8)

[muscleman]

thanks MM

 

in addition to brown and ginsberg, kavanaugh would have been favorable, but not any other particular judge to my knowledge

 

1 out of 289?  i'll take those odds    8)

 

Come on. We got Lamberth last time. We deserve someone better this time!  :D

 

[hillfronter83]

from merkhet 08:25:49 PM  "The article is clearly written by Sunstein as an opprobrium on the United States Court of Appeals for the District of Columbia, and, in particular Judges Brown & Ginsburg, but it seems like he is indicating that they would be both be favorably inclined in our case. "

 

for the probability stats geeks among us:

 

now, while brown and ginsburg are not the only two "conservative" judges on the dc circuit. nonetheless given that the merits panel has 3 judges and there are 17 judges to choose a panel from, what are the chances that a panel with those two judges on it would be selected?

 

[spits 3 times]

 

Well that depends on whether the judges are randomly chosen or the plaintiffs and defendants can appoint them. If not randomly chosen, the probability is very hard to calculate.

 

i have read that it is random, using a process that court wont disclose

 

EDIT:  found the link:  http://www.law.du.edu/images/uploads/neutral-assignment/Neutral_assignment_links.pdf (15 years old so process might have changed)

 

In this case the chance is 1 out of 289. However I assume there are other judges that will also believe in law.  :) And I still have hope in the US and believe Lamberth is a rare beast in the US judicial system.

 

In other countries like Russia and China, most judges are like Lamberth. The government is always right, no matter what it does.

 

thanks MM

 

in addition to brown and ginsberg, kavanaugh would have been favorable, but not any other particular judge to my knowledge

 

1 out of 289?  i'll take those odds    8)

 

The possibility that at least one of two will be on the panel is about 33%.

[intothebreach]

17 judges. Since a judge cannot be picked twice for the same panel at the same time, we have 17 * 16 * 15 = 4,080 different possibilities with some of them being exactly the same (as in A/B/C = C/B/A = A/C/B = ...)

 

6 of these outcomes correspond to the desired 2 judges (A/B/-, B/A/-, -/A/B, -/B/A, A/-/B, B/-/A)

 

So there should be 6 / 4,080 or slightly less than 0.15% chances of getting the desired scenario (assuming that the selection is purely random.)