Fairholme and Arrowood delivered their response to FHFA, Fannie and Freddie’s motion to dismiss (Doc. 66 filed on Jan. 10, 2018, in Case No. 13-mc-01288) to Judge Lamberth yesterday evening, and a copy is attached to this e-mail message. Fairholme and Arrowood tell Judge Lamberth that while FHFA argues shareholders’ contract claims aren’t ripe, they are because the D.C. Circuit said they are in the Perry decision. Further, while HERA and the PSPAs presumably could have eliminated public shareholders’ interests in the GSEs, Congress and the PSPAs didn’t do that. As a result, shareholders are entitled to damages and restitution.13-cv-01053-0076
Counsel to the Rafter Plaintiffs sent Judge Sweeney a letter yesterday disclosing an inadvertent breach of the Protective Order entered in Fairholme v. U.S. Apparently, one sentence from one still-sealed document FHFA produced was included in a draft of the Rafter Plaintiffs’ amended complaint to be filed later this month, and that draft containing that secret sentence found its way to David Klafter at Pershing Square. Pershing Square has done everything it knows to do to contain the leak. A copy of the letter sent to Judge Sweeney is attached to this e-mail message.13-465-0397
The Class Plaintiffs delivered their response to FHFA’s motion to dismiss to Judge Lamberth yesterday evening, and a copy of the filing is attached to this e-mail message. “Some might think that private shareholders had no right to receive anything even before the Third Amendment was agreed to on August 17, 2012 — or that they did not ‘deserve’ to receive anything given that they were owners in distressed entities that Treasury ‘bailed out’ through its funding commitments,” the Class Plaintiffs tell Judge Lamberth, “[b]ut that is neither legally correct nor fair.” The Class Plaintiffs urge Judge Lamberth “to recognize the basic fairness underlying Plaintiffs’ claims not because the law is against us, but because the law is overwhelmingly with us. The only thing that could be against us is an instinct to favor the Government based on the perception that it stepped into the breach during a crisis. But even if that perception were fully accurate, it is not the whole story, and it cannot justify what happened in August 2012.”13-mc-01288-0072