Rop v. Fed. Hous. Fin. Agency
Decision Date | 04 October 2022 |
Docket Number | 20-2071 |
Parties | MICHAEL ROP; STEWART KNOEPP; ALVIN WILSON, Plaintiffs-Appellants, v. FEDERAL HOUSING FINANCE AGENCY; SANDRA L. THOMPSON, in her official capacity as Director of the Federal Housing Finance Agency; UNITED STATES DEPARTMENT OF THE TREASURY, Defendants-Appellees. |
Court | U.S. Court of Appeals — Sixth Circuit |
Argued: June 9, 2022
Appeal from the United States District Court for the Western District of Michigan at Grand Rapids. No. 1:17-cv-00497-Paul Lewis Maloney, District Judge.
ARGUED:
Peter A. Patterson, COOPER & KIRK, PLLC, Washington, D.C., for Appellants.
Robert J. Katerberg, ARNOLD & PORTER KAYE SCHOLER LLP Washington, D.C., for Appellees Thompson and Federal Housing Finance Agency.
Gerard Sinzdak, UNITED STATES DEPARTMENT OF JUSTICE, Washington D.C., for Appellee United States Department of the Treasury.
ON BRIEF:
Peter A. Patterson, David H. Thompson, Charles J. Cooper, Brian W Barnes, John D. Ramer, COOPER & KIRK, PLLC, Washington, D.C., for Appellants.
Robert J. Katerberg, Howard N. Cayne, Asim Varma, ARNOLD & PORTER KAYE SCHOLER LLP, Washington, D.C., for Appellees Thompson and Federal Housing Finance Agency.
Gerard Sinzdak, Abby C. Wright, Kyle Edwards, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee United States Department of the Treasury.
Before: GIBBONS, COOK, and THAPAR, Circuit Judges.
Shareholders in Fannie Mae and Freddie Mac sued the Federal Housing Finance Agency ("FHFA"), which is the companies' conservator, and the Treasury Department. This lawsuit, and many others like it, seeks to nullify an agreement between FHFA and Treasury that "secured unlimited funding for Fannie and Freddie from Treasury in exchange for almost all of Fannie's and Freddie's future profits." Rop v. Fed. Hous. Fin. Agency, 485 F.Supp.3d 900, 910 (W.D. Mich. 2020). Shareholders allege that this agreement, known as the third amendment, was authorized by a government official-the Acting Director of FHFA-who was serving in violation of the Appointments Clause. Shareholders also claim that they are entitled to retrospective relief because the Supreme Court held in Collins v. Yellen, 141 S.Ct. 1761 (2021), that FHFA's enabling statute contained an unconstitutional removal restriction. The district court dismissed shareholders' complaint, finding that the Appointments Clause claim presented a nonjusticiable political question and that the removal restriction claim was not connected to shareholders' alleged injuries. We reverse and consider the Appointments Clause claim on the merits, holding that the Acting Director was not serving in violation of the Constitution when he signed the third amendment. We remand to the district court to determine whether, considering Collins, the unconstitutional removal restriction inflicted harm on shareholders.
I.
Like the district court, we turn to the Court of Appeals for the District of Columbia Circuit for the third amendment's relevant factual background:
To continue reading
Request your trial