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

[merkhet]

I think those docs were already published - http://fanniefreddiesecrets.org/resources/

 

May 11, 2016 Docs.

[Guest cherzeca]

It's on Pacer. It is real. Lots more too.... Attached is just part of it.

 

filed with judge sweeney in fairholme case, seeking lifting of seal so that robinson can argue it in her response to motion to dismiss.

 

@merkhet  as to the perry order question 1 re jurisdiction to hear fiduciary duty claim against treasury, it seems to me after a brief look that this is really an APA section 706 claim, that treasury as a controlling shareholder (preferred and warrants) owed a fiduciary duty to common under delaware corp law, and that treasury violated this duty, and there is no federal preemption.

 

interested to hear your view.  i agree with your analysis re question 2 btw.

[merkhet]

It's on Pacer. It is real. Lots more too.... Attached is just part of it.

 

filed with judge sweeney in fairholme case, seeking lifting of seal so that robinson can argue it in her response to motion to dismiss.

 

@merkhet  as to the perry order question 1 re jurisdiction to hear fiduciary duty claim against treasury, it seems to me after a brief look that this is really an APA section 706 claim, that treasury as a controlling shareholder (preferred and warrants) owed a fiduciary duty to common under delaware corp law, and that treasury violated this duty, and there is no federal preemption.

 

interested to hear your view.  i agree with your analysis re question 2 btw.

 

I haven't spent much time on Q1, but I could see diversity jurisdiction for SMJ & APA as a waiver of sovereign immunity.

[Steve_Berk]

Just reading over these posts again. I believe that the court is just being extremely thorough. Although there are plenty of activist judges, it could be that these judges (or at least one of them) want to do everything they can exercise judicial restraint, which means that they want to limit the exercise of their own power and will only rule on what they need to rule upon. Clearly there are very complex issues that need to be decided if they take jurisdiction--I think they want to be absolutely sure that it's necessary. Because of this distinct possibility, I don't think you can see the order as a positive sign (also can't see it as a negative one either). Don't forget that this is the same court that unilaterally brought up s 4623 and asked for supplemental briefing even though neither side had raised the issue.

 

Would the court need this much time and/or information if they were to simply agree with Lamberth or remand it back to him without specific instructions?  I'm probably biased at this point, but wouldn't this logically lead to remand with instructions or full overturn as the two most plausible outcomes?

 

Unclear. They could just be more thorough than Lamberth. My best guess is that they think the common law claim has merit, but they're uncertain about the jurisdictional aspects.

 

if you recall fhfa put all of its money on the claim that the Ps gave up all of their shareholder rights under HERA. didnt argue that Ps couldnt sue fhfa, as the govt, as a matter of subject matter jurisdiction (meaning authorization to sue under statutory or constitutional law).

 

so this indicates to me that the court is being very careful and covering all bases under which govt could win, if the arguments are available to them.  this argument simply wasnt availed by fhfa because the no shareholder rights might permit fhfa to win in fed ct, and we're not the govt might permit them to win in court of claims

[Guest cherzeca]

Just reading over these posts again. I believe that the court is just being extremely thorough. Although there are plenty of activist judges, it could be that these judges (or at least one of them) want to do everything they can exercise judicial restraint, which means that they want to limit the exercise of their own power and will only rule on what they need to rule upon. Clearly there are very complex issues that need to be decided if they take jurisdiction--I think they want to be absolutely sure that it's necessary. Because of this distinct possibility, I don't think you can see the order as a positive sign (also can't see it as a negative one either). Don't forget that this is the same court that unilaterally brought up s 4623 and asked for supplemental briefing even though neither side had raised the issue.

 

Would the court need this much time and/or information if they were to simply agree with Lamberth or remand it back to him without specific instructions?  I'm probably biased at this point, but wouldn't this logically lead to remand with instructions or full overturn as the two most plausible outcomes?

 

Unclear. They could just be more thorough than Lamberth. My best guess is that they think the common law claim has merit, but they're uncertain about the jurisdictional aspects.

 

if you recall fhfa put all of its money on the claim that the Ps gave up all of their shareholder rights under HERA. didnt argue that Ps couldnt sue fhfa, as the govt, as a matter of subject matter jurisdiction (meaning authorization to sue under statutory or constitutional law).

 

so this indicates to me that the court is being very careful and covering all bases under which govt could win, if the arguments are available to them.  this argument simply wasnt availed by fhfa because the no shareholder rights might permit fhfa to win in fed ct, and we're not the govt might permit them to win in court of claims

 

agreed. but remember, these issues should have been raised by govt. in its briefing.  while govt hasnt exactly covered itself in glory in their briefs, the fact that these issues remain outstanding indicates a weakness on the part of the govt's case, as opposed to the P's case, imo

[Steve_Berk]

Don't get me wrong, I think that the order is ridiculous in some respects--questioning for jurisdictional purposes whether the fhfa was acting as a conservator or regulator? What? How is that even a thing? I'm looking forward to seeing how the FHFA tries to thread that needle. Although I'm not going to try to speculate too much, one thing that I'm very confident of is that the court doesn't think that this is an easy case to dismiss on jurisdictional grounds alone.

 

Just reading over these posts again. I believe that the court is just being extremely thorough. Although there are plenty of activist judges, it could be that these judges (or at least one of them) want to do everything they can exercise judicial restraint, which means that they want to limit the exercise of their own power and will only rule on what they need to rule upon. Clearly there are very complex issues that need to be decided if they take jurisdiction--I think they want to be absolutely sure that it's necessary. Because of this distinct possibility, I don't think you can see the order as a positive sign (also can't see it as a negative one either). Don't forget that this is the same court that unilaterally brought up s 4623 and asked for supplemental briefing even though neither side had raised the issue.

 

Would the court need this much time and/or information if they were to simply agree with Lamberth or remand it back to him without specific instructions?  I'm probably biased at this point, but wouldn't this logically lead to remand with instructions or full overturn as the two most plausible outcomes?

 

Unclear. They could just be more thorough than Lamberth. My best guess is that they think the common law claim has merit, but they're uncertain about the jurisdictional aspects.

 

if you recall fhfa put all of its money on the claim that the Ps gave up all of their shareholder rights under HERA. didnt argue that Ps couldnt sue fhfa, as the govt, as a matter of subject matter jurisdiction (meaning authorization to sue under statutory or constitutional law).

 

so this indicates to me that the court is being very careful and covering all bases under which govt could win, if the arguments are available to them.  this argument simply wasnt availed by fhfa because the no shareholder rights might permit fhfa to win in fed ct, and we're not the govt might permit them to win in court of claims

 

agreed. but remember, these issues should have been raised by govt. in its briefing.  while govt hasnt exactly covered itself in glory in their briefs, the fact that these issues remain outstanding indicates a weakness on the part of the govt's case, as opposed to the P's case, imo

[SnarkyPuppy]

Why am I continuously seeing FNMA hit 0.01 per share?  Are these real trades?

[deadspace]

Any theories out there as to why the issue of US sovereignty is being raised with the preferred shareholders and not the common?  Thanks

[Mephistopheles]

New lawsuit filed in the District Court of DC

 

http://gselinks.com/Court_Filings/Voacolo/16-01324-0001.pdf

 

From GSE links:

 

Peter Chapman writes, "David J. Voacolo, a New Jersey resident who purchased 50,000 shares of Fannie Mae common stock in Aug. 2009, sued Fannie, FHFA and Treasury earlier today. A copy of Mr. Voacolo's complaint, filed in the U.S. District Court for the District of Columbia, is attached above.

Mr. Voacolo is proceeding under the Administrative Procedures Act and alleges an illegal exaction under the Fifth Amendment to the U.S. Constitution. Based on what the government said following his purchase of Fannie Mae stock, Mr. Voacolo alleges that the government has earned a sufficient return on its investment and Fannie Mae's future profits should flow to common shareholders.

Mr. Voacolo is represented by Alexander J. E. English, Esq., in Jessup, Md., and Afia SenGupta, Esq., and Angela Lipsman, Esq., at Brus Chambers LLC, in New York City. You'll recall seeing Mr. Voacolo and Brus Chambers' names in Exhibit 1 to FHFA's Transfer Motion presented to the Judicial Panel on Multidistrict Litigation on Mar. 15, 2016."

[merkhet]

Any theories out there as to why the issue of US sovereignty is being raised with the preferred shareholders and not the common?  Thanks

 

It's being raised with respect to both.

[merkhet]

I'm continually surprised at the sloth of the District Court of Delaware. The MDL rejection came in almost a month ago, and yet, there has been no movement whatsoever from that court.

[Eye4Valu]

I thought the Delaware Court of Chancery was known for its expediency in addition to its well defined corporate laws?

[Eye4Valu]

Or is the District Court not the same?

[merkhet]

I thought the Delaware Court of Chancery was known for its expediency in addition to its well defined corporate laws?

 

It's not filed in the Delaware Court of Chancery. It's filed in the District Court of Delaware. The former is a state level court; the latter is a federal level court.

[doughishere]

I'm continually surprised at the sloth of the District Court of Delaware. The MDL rejection came in almost a month ago, and yet, there has been no movement whatsoever from that court.

 

Think there is some back room debate going on?

[Guest cherzeca]

Ps are waiting on judge sleet to set a date for oral argument.  compare him to judge thapar in robinson case, who essentially said  before mdl panel decision that he was ready for case to proceed.  my guess is that sleet is a last minute louie, and never read anything before the mdl move request, and now is behind the 8ball in prepping for case.

[Mephistopheles]

Boy would it be nice for all this to work out just as the rest of the market is crashing. Let's pray to atleast get to half of par by end of August!

[doughishere]

Unsealed Saxton Amended Complaint.

 

Peter A. Chapman wrote:

At the Saxton Plaintiffs' behest, Magistrate Scoles released the shareholders' Amended Complaint from seal yesterday.  Copies of the Saxton Plaintiffs' Motion (Doc. 84), Magistrate Scoles' Order (Doc. 85), and the now-unsealed Amended Complaint (Doc. 61), are attached.

15-00047-0085.pdf

15-00047-0084.pdf

15-00047-0061.pdf

[TonyG]

I wonder if Ackman ever ended up meeting with Corker

[Steve_Berk]

I'm sure Ackman would have accepted the invitation, but I'm also thinking that Corker in reality has zero interest in talking to him one-on-one

I wonder if Ackman ever ended up meeting with Corker

[merkhet]

I'm sure Ackman would have accepted the invitation, but I'm also thinking that Corker in reality has zero interest in talking to him one-on-one

I wonder if Ackman ever ended up meeting with Corker

 

That's my thought as well.

[doughishere]

Maybe a repost or most of you may have seen it already. Threr's nothing really of value that hasnt been heard before in it.

 

Shaky Ground: What Investors Can Learn from the Strange Saga of Fannie and Freddie Bethany McLean Contributing Editor Vanity Fair Chicago

 

CFA Institute Q1 cfapubs.org

 

http://www.cfapubs.org/doi/pdf/10.2469/cp.v33.n1.3

 

 

 

[doughishere]

The Novel Procedural Complexities in Perry Capital v. Lew - Epstein

 

http://www.forbes.com/sites/richardepstein/2016/06/30/the-novel-procedural-complexities-in-perry-capital-v-lew/#7c4f3cfe51a8

 

 

 

 

[Guest cherzeca]

i have been impressed by counsel for P robinson, taft stettinius, and this reply brief furthers my respect:  http://www.glenbradford.com/wp-content/uploads/2016/06/063016-Robinson-Reply.pdf

 

this reply to the fhfa as regulator argument has already been made by perry counsel and IU amicus counsel, but taft went beyond what could have been a copy and paste job and did a great job.

[merkhet]

i have been impressed by counsel for P robinson, taft stettinius, and this reply brief furthers my respect:  http://www.glenbradford.com/wp-content/uploads/2016/06/063016-Robinson-Reply.pdf

 

this reply to the fhfa as regulator argument has already been made by perry counsel and IU amicus counsel, but taft went beyond what could have been a copy and paste job and did a great job.

 

Agree. Well drafted reply.

 

The Novel Procedural Complexities in Perry Capital v. Lew - Epstein

 

http://www.forbes.com/sites/richardepstein/2016/06/30/the-novel-procedural-complexities-in-perry-capital-v-lew/#7c4f3cfe51a8

 

Before turning to these specific queries, we should ask, why this order at this time? Clearly, Judges Millett and Brown and Senior Judge Ginsburg had ample time to moot the underlying substantive questions. If they thought that Judge Lamberth was correct, they could have issued an opinion that tracked his reasoning without further briefing. The surprise request from the panel suggests, at the very least, that the judges do not think that the substantive issues are cut and dry in favor of the government.

 

Agree. Looking forward to reading the class plaintiffs' brief this weekend.