Robinson v. Federal Housing Finance Agency

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Robinson is a stockholder in the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) (the Companies), for-profit corporations organized by the government under 12 U.S.C. 1716-1723 and 1451-1459. During the economic recession in 2007–2008, Congress enacted the Housing and Economic Recovery Act (HERA), which created the Federal Housing Finance Agency (FHFA), and authorized FHFA to place the Companies in conservatorship. The Companies, through FHFA, entered into agreements with the Department of the Treasury that allowed the Companies to draw funds from Treasury in exchange for dividend payments and other financial benefits. An Amendment to those agreements modified the dividend payment structure and required the Companies to pay to Treasury, as a quarterly dividend, an amount just short of their net worth. The Amendment effectively transferred the Companies’ capital to Treasury and prevented dividend payments to junior stockholders, such as Robinson. Robinson brought suit. The district court found and the Sixth Circuit affirmed that Robinson’s claims under the Administrative Procedures Act were barred by HERA’s limitation on court action and that Robinson had failed to state a claim upon which relief can be granted. Robinson failed to demonstrate that FHFA or Treasury exceeded the statutory authority granted by HERA. View "Robinson v. Federal Housing Finance Agency" on Justia Law