Angel v. United States
Angel
Court
United States Court of Federal Claims
Decided
June 26, 2025
Jurisdiction
FS
Importance
45%
Case Summary
In the United States Court of Federal Claims JOSHUA J. ANGEL, Plaintiff, v. No. 23-cv-0800 (Filed: June 26, 2025) THE UNITED STATES, Defendant. Joshua J. Angel, New York, N.Y., for Plaintiff. Anthony F. Schiavetti, Civil Division, United States Department of Justice, Washington, D.C., for Defendant. OPINION AND ORDER Meriweather, Judge. Plaintiff, Joshua J. Angel (“Mr. Angel” or “Plaintiff”), on behalf of himself and a putative class of shareholders,1 seeks compensation from the United States for changes to how the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) (collectively, “the Enterprises”) declare dividends following the Enterprises’ 2008 financial collapse and subsequent conservatorship. Before the Court is Mr. Angel’s Motion for Reconsideration, ECF No. 34 (“Mot.”), pursuant to Court of Federal Claims Rule 59, requesting that the Court vacate its June 25, 2024 Opinion and Order (“Opinion”) granting Defendant’s Motion to Dismiss. See generally Angel v. United States, 172 Fed. Cl. 102 (2024) (“Angel IV”). Having reviewed this Court’s prior ruling, the relevant filings,2 and the law, the Court DENIES Mr. Angel’s Motion for Reconsideration. 1 “Shareholders,” as used in this Opinion, excludes the Department of Treasury (“Treasury”). See Compl. at 2 n.1, ECF No. 1. 2 The following filings are relevant to this Opinion: Compl., ECF No. 1; Opinion, ECF No. 32; Mot., ECF No. 34; and Def.’s Resp. to Pl.’s Mot. for Recons., ECF No. 38 (“Resp.”). Throughout, page citations to documents in the record refer to the document's original pagination, unless the page is designated with an asterisk (e.g., *1), in which case the reference is to the pagination assigned by PACER/ECF. BACKGROUND The Court set forth the factual background in detail in its Opinion. See Angel IV, 172 Fed. Cl. at 109–12. For purposes of the pending motion, the Court will briefly summarize the relevant facts and posture of the case. I. Following the 2008 Housing Market Collapse, Fannie Mae and Freddie Mac Stop Declaring Dividends In Fairholme Funds, Inc. v. United States, the Federal Circuit detailed the financial history that ultimately led to the Enterprises’ conservatorship and the curtailment of dividend payments that gave rise to Mr. Angel’s claims. 26 F.4th 1274 (Fed. Cir. 2022), cert. denied, 143 S. Ct. 563, cert. denied sub nom. Barrett v. United States, 143 S. Ct. 562, cert. denied sub nom. Owl Creek Asia I, L.P. v. United States, 143 S. Ct. 563, and cert. denied sub nom. Cacciapalle v. United States, 143 S. Ct. 563 (2023). As recounted in Fairholme, and as quoted by this Court in its prior Opinion, Angel IV: The Enterprises suffered devastating financial losses in the 2008 housing market collapse. In response, Congress enacted the Housing and Economic Recovery Act of 2008 (“HERA”) which created the Federal Housing Finance Agency (“FHFA”), tasked with regulating the Enterprises and (if necessary) stepping in as conservator or receiver. 12 U.S.C. §§ 4511, 4617. HERA also contains a Succession Clause, stating that FHFA “shall, as conservator . . . succeed to [] all rights, titles, powers, and privileges of the [Enterprises], and of any stockholder . . . with respect to the [Enterprises] and [its] assets.” § 4617(b)(2)(A)(i). In September 2008, the FHFA Director placed the Enterprises into conservatorship. The FHFA Director then negotiated preferred stock purchase agreements (“PSPAs”) with the Treasury. FHFA and Treasury amended the original PSPA terms. The Third Amendment implemented a “net worth sweep,” which replaced the fixed-rate dividend formula agreed to under the initial PSPAs with a variable one that required the Enterprises to make quarterly payments equal to their entire net worth, minus a small capital reserve amount. The net worth sweep caused the Enterprise to transfer most, if not all, of their equity to Treasury, leaving no residual value that could be distributed to shareholders. 172 Fed. Cl. at 109 (quoting Fairholme, 26 F.4th at 1282–83) (cleaned up). II. Fannie Mae and Freddie Mac Shareholder Litigation Following the Third Amendment, “[s]hareholders launched a series of challenges” attempting to undo the net worth sweep itself, or, alternatively, directly seeking compensation for changes to the benefits of owning stock in the Enterprises. See id. at 110 (collecting cases). Although these challenges advanced multiple theories of liability and worked thei
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Decided
Date Decided
June 26, 2025
Jurisdiction
FS
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federal
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In the United States Court of Federal Claims
JOSHUA J. ANGEL, Plaintiff,
v. No. 23-cv-0800
(Filed: June 26, 2025)
THE UNITED STATES,
Defendant.
Joshua J. Angel, New York, N.Y., for Plaintiff.
Anthony F. Schiavetti, Civil Division, United States Department of Justice, Washington, D.C., for Defendant.
OPINION AND ORDER
Meriweather, Judge.
Plaintiff, Joshua J. Angel (“Mr. Angel” or “Plaintiff”), on behalf of himself and a putative
class of shareholders,1 seeks compensation from the United States for changes to how the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) (collectively, “the Enterprises”) declare dividends following the Enterprises’ 2008 financial collapse and subsequent conservatorship. Before the Court is Mr. Angel’s Motion for Reconsideration, ECF No. 34 (“Mot.”), pursuant to Court of Federal Claims Rule 59, requesting that the Court vacate its June 25, 2024 Opinion and Order (“Opinion”) granting Defendant’s Motion to Dismiss. See generally Angel v. United States, 172 Fed. Cl. 102 (2024) (“Angel IV”). Having reviewed this Court’s prior ruling, the relevant filings,2 and the law, the Court DENIES Mr. Angel’s Motion for Reconsideration.
1
“Shareholders,” as used in this Opinion, excludes the Department of Treasury
(“Treasury”). See Compl. at 2 n.1, ECF No. 1. 2 The following filings are relevant to this Opinion: Compl., ECF No. 1; Opinion, ECF No. 32; Mot., ECF No. 34; and Def.’s Resp. to Pl.’s Mot. for Recons., ECF No. 38 (“Resp.”). Throughout, page citations to documents in the record refer to the document's original pagination, unless the page is designated with an asterisk (e.g., *1), in which case the reference is to the pagination assigned by PACER/ECF. BACKGROUND
The Court set forth the factual background in detail in its Opinion. See Angel IV, 172
Fed. Cl. at 109–12. For purposes of the pending motion, the Court will briefly summarize the relevant facts and posture of the case.
I. Following the 2008 Housing Market Collapse, Fannie Mae and Freddie Mac Stop Declaring Dividends
In Fairholme Funds, Inc. v. United States, the Federal Circuit detailed the financial
history that ultimately led to the Enterprises’ conservatorship and the curtailment of dividend payments that gave rise to Mr. Angel’s claims. 26 F.4th 1274 (Fed. Cir. 2022), cert. denied, 143 S. Ct. 563, cert. denied sub nom. Barrett v. United States, 143 S. Ct. 562, cert. denied sub nom. Owl Creek Asia I, L.P. v. United States, 143 S. Ct. 563, and cert. denied sub nom. Cacciapalle v. United States, 143 S. Ct. 563 (2023). As recounted in Fairholme, and as quoted by this Court in its prior Opinion, Angel IV:
The Enterprises suffered devastating financial losses in the 2008 housing market
collapse. In response, Congress enacted the Housing and Economic Recovery
Act of 2008 (“HERA”) which created the Federal Housing Finance Agency
(“FHFA”), tasked with regulating the Enterprises and (if necessary) stepping in as
conservator or receiver. 12 U.S.C. §§ 4511, 4617. HERA also contains a
Succession Clause, stating that FHFA “shall, as conservator . . . succeed to [] all
rights, titles, powers, and privileges of the [Enterprises], and of any stockholder . .
. with respect to the [Enterprises] and [its] assets.” § 4617(b)(2)(A)(i).
In September 2008, the FHFA Director placed the Enterprises into
conservatorship. The FHFA Director then negotiated preferred stock purchase
agreements (“PSPAs”) with the Treasury.
FHFA and Treasury amended the original PSPA terms. The Third Amendment
implemented a “net worth sweep,” which replaced the fixed-rate dividend formula
agreed to under the initial PSPAs with a variable one that required the Enterprises
to make quarterly payments equal to their entire net worth, minus a small capital
reserve amount. The net worth sweep caused the Enterprise to transfer most, if
not all, of their equity to Treasury, leaving no residual value that could be
distributed to shareholders.
172 Fed. Cl. at 109 (quoting Fairholme, 26 F.4th at 1282–83) (cleaned up).
II. Fannie Mae and Freddie Mac Shareholder Litigation
Following the Third Amendment, “[s]hareholders launched a series of challenges”
attempting to undo the net worth sweep itself, or, alternatively, directly seeking compensation for changes to the benefits of owning stock in the Enterprises. See id. at 110 (collecting cases). Although these challenges advanced multiple theories of liability and worked thei
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Case Details
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Status
Decided
Date Decided
June 26, 2025
Jurisdiction
FS
Court Type
federal
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Metadata
Additional information
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