Earlier this month, Gibson Dunn & Crutcher's Theodore Olson made headlines when he filed a lawsuit accusing the federal government of blocking private stockholders of Fannie Mae and Freddie Mac from getting their fair share. Since then, more than a half dozen plaintiffs firms have gotten into the game, filing related cases in Washington's federal district court and in the U.S. Court of Federal Claims.
The cases challenge an August 2012 agreement between the conservator of Fannie and Freddie—the Federal Housing Finance Agency—and the U.S. Department of Treasury that changed the structure of preferred stock purchase agreements held by Treasury.
According to the complaint, the 2012 agreement essentially diverted Fannie and Freddie's net worth to the Treasury Department, leaving no money to pay dividends on stocks held by private companies and individuals. The plaintiffs accused the government of making the change just as Fannie and Freddie were recovering from the economic downturn and posting profits.