Motion of the Acting Solicitor General for leave to participate in oral argument as amicus curiae and for divided argument filed. Instead, there was silence. 1723a (a). . Last month, Amy Coney Barrett single-handedly denied a separate but similar request. 187, 189 (NJ 1951) (collecting cases). But the legislative history does reveal that Congress intended to reduce the footprint of the federal government in the national housing market. Congress elimination of the amount-in-controversy requirement suggests, if anything, it understood that court of competent jurisdiction could be read to require an outside source of jurisdiction. We later withdrew that disposition, appointed pro bono counsel, and ordered the parties to brief whether Fannie Mae's federal charter granted the district court subject matter jurisdiction. in all relevant respects identical to [the clause in DOench] on which [the Court] based a holding of federal jurisdiction just five years before [its enactment], the provision extends beyond a mere grant of general corporate capacity to sue, and suffices to confer federal jurisdiction. Ibid. 244, 244 n.1 (1945). Further, Fannie Mae notes that the language for this amendment was identical to language in Title I of the charter, and two federal courts had already held that the language in Title I conferred federal jurisdiction. Sanders Co. v. BHAP Hous. Testa restated the uncontroversial proposition that state courts cannot refuse to hear federal causes of action when those courts entertain similar state law causes of action. @AHoweBlogger was there and has the story: Protesters supporting abortion rights briefly interrupt oral argument - SCOTUSblog. This, the Chief Justice announced, evinces the opinion of congress, that the right to sue does not imply a right to sue in the courts of the union, unless it be expressed. Id. Lightfoot V. Cendant Mortgage Corporation Petition for Certiorari. Absent the of competent jurisdiction proviso, this clause would clearly confer jurisdiction on the federal courts. 1. Congress has used the sue-and-be-sued clauses of federal corporations to achieve multiple goals. No. Under the rule announced in American National<br> Red Cross v. S.G., 505 U.S. 247 (1992 . 93383, 806(b), 88 Stat. See Hancock, 492 F.2d at 132829. No. Ass'n, No. at 25557. Neither of these sue-and-be-sued clauses confers automatic federal jurisdiction. Here's the order list, which comprises six pages of orders plus 48(!) The majority criticizes my reliance on these cases because they were handed down prior to Red Cross, which, as set forth above, announced no new rule of law. at 257. Corp. v. Fed. This Court has understood that phrase as a reference to a court with an existing source of subject-matter jurisdiction. See H.R.Rep. They maintain that, after the Court rules on statutory interpretation, the power rests with Congress to alter the language of the statute if it so chooses. They suggest that Congresss authority to confer jurisdiction to federal courts, and hence expand judicial power, under Article III is not without limits. Lightfoot v. Cendant Mortgage Corp. Lightfoot v. Cendant Mortgage Corp., 580 U.S. ___ (2017), was a United States Supreme Court case that clarified whether Fannie Mae can be sued in state courts. Ramos v.Louisiana, 590 US ___ (2020). While the majority reasoned that the of competent jurisdiction clause in the Fannie Mae charter is merely an add-on and does not create a difference in interpretive meaning from that of Red Cross, Judge Stein suggested that this clause explicitly requires Fannie Mae to establish an independent determination of subject matter jurisdiction. Sastin 2 LLC v. Hemingway Association Inc | W.D. Oklahoma | 11-19-2018 Lightfoot v. Cendant Mortgage Corp. - Global Legal Chronicle Cf. AAJ agrees, arguing that it would be inappropriate to overrule Osborn, and the subsequent decisions reaffirming Osborn, given that Article IIIs arising under jurisdiction is already broader than federal question jurisdiction laid out in 28 U.S.C. Fannie Mae's sue-and-be-sued clause can easily be read to have the same purpose. ), and so some cases were dismissed or remanded to state court for lack of federal jurisdiction. IT IS SO ORDERED. at 265 (Scalia, J., dissenting). The Legislative Context of Fannie Mae's SueAndBeSued Clause. 95110. May 14, 2013); Fed. Fannie Mae, on the other hand, had already transitioned into a privately owned corporation. Id. . Wednesday, March 02, 2016. Nat'l Mortg. Lightfoot v. Cendant Mortgage Corporation: Oral Argument - November 08, 2016 - YouTube Facts:Crystal Monique Lightfoot and Beverly Ann Hollis-Arlington sued the Federal National Mortgage. See 1452(c) (to sue and be sued, complain and defend, in any State, Federal, or other court); 1452(f) (providing that Freddie Mac is a federal agency under 28 U.S.C. 1345, 1442, that civil actions to which Freddie Mac is a party arise under federal law, and that Freddie Mac may remove cases to federal district court before trial). This brief, ambiguous statement did not settle the meaning of 216(b), and thus did not settle the meaning of the phrase court of competent jurisdiction. The other cases in this set dealt with the Housing and Rent Act of 1947. Looking beyond the plain language of Fannie Mae's sueand-be-sued clause, the history of Congress' amendments to this statute reinforces the conclusion that the clause does not confer federal subject matter jurisdiction. at 933 (deleting reference to a court of law, equity, or admiralty). Red Cross thus did not announce a magic-words test that ends all inquiry the moment we come across the word federal; it restated a default rule to assist Congress and the courts in writing and interpreting sue-and-be-sued clauses. The district court dismissed the case for failure to state a claim, and the Ninth Circuit affirmed. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Washington, D.C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press. This is the second time she's done so. Wikizero - Lightfoot v. Cendant Mortgage Corp. This very Circuit has followed the non-jurisdictional interpretation of the statute, albeit in dicta. See, e.g., Washington Post, July 14, 1940, p. P2 (Fanny May); N.Y. The mortgage was sold to the private mortgage company and, after efforts to prevent the foreclosure failed, the home was sold at a trustee's sale. But we do not believe that this was the purpose of the 1974 amendment. See, e.g., Schuman v. Greenberg, 100 F. Supp. Along with these structural changes, the 1954 Act replaced Fannie Maes initial set of powers with a more detailed list. Additionally, Fannie Mae claims that Lightfoot and Hollis-Arrington must be wrong that Congress wanted the 1954 amendment to ensure that there was no federal jurisdiction because the amendment also deemed Fannie Mae a federal agency controlled entirely by the government, and federal courts have jurisdiction over such agencies under 28 U.S.C. It purchases mortgages that meet its eligibility criteria, packages them into mortgage-backed securities, and sells those securities to investors, and it invests in mortgage-backed securities itself. Just as a Delaware corporation is an entity incorporated under the laws of that state, see, e.g., Eldridge v. Richfield Oil Corp., 364 F.2d 909, 909 (9th Cir.1966), a District of Columbia corporation is one that has been incorporated under the laws of the District. Counsel for Fannie Mae nicely summarized this point at oral argument: If Congress says you can sue or be sued in federal court, that is at least a profoundly strong default rule and you'd have to find something else in the statute that says even though we want you to sue in federal court, we don't really mean it. Oral Arg. Supreme Court cases from Deveaux to D'Oench had put Congress on notice that a specific reference to the federal courts was necessary and sufficient to confer jurisdiction. Red Cross, 505 U.S. at 252 (emphasis added). S.Rep. Finally, the dissent points to several circuit court cases decided after 1954 that interpret the phrase court of competent jurisdiction the same way the dissent does. PDF Lightfoot v. Cendant Mortgage Corp. - cases.justia.com No. So long as the sue-and-be-sued clause refers to an outside source of subject-matter jurisdiction, it does not confer subject-matter jurisdiction. In 1954, the same year Congress amended Fannie Mae's charter, Congress eliminated federal question jurisdiction for the FSLIC by deleting language in its charter that had authorized suit in any court of law or equity, State or Federal. Congress replaced it with language authorizing suit in any court of competent jurisdiction in the United States. See H.R.Rep. SupremeQuote.org Dissent at 23. The Supreme Court granted certiorari on June 28, 2016. It never once mentioned the change to Fannie Mae's sue-and-be-sued clause. Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473, 483484 (1981). The District Court denied a motion to remand the case to state court and later entered judgment against petitioners. Further, they distinguish the facts of Red Cross from those in this case and assert that this distinction calls for a reversal of the Ninth Circuits holding. Sign up to receive a daily email As district judge Dean Pregerson recently summarized, courts in this circuit appear to have uniformly reached the [ ] conclusion that Fannie Mae's charter does not confer federal subject matter jurisdiction. TermsPrivacyDisclaimerCookiesDo Not Sell My Information, Begin typing to search, use arrow keys to navigate, use enter to select, Stay up-to-date with FindLaw's newsletter for legal professionals. Lightfoot v. Cendant Mortgage Corp Justia U.S. Supreme Court Opinion 1349). Disagreeing that this extends Article IIIs scope such as to create constitutionally absurd results, Fannie Mae maintains that it would be wrong to apply the constitutional avoidance doctrine. A long line of cases has held that this statute does not confer federal jurisdiction. 12 U. S. C. 1723a(a) Lightfoot v. Cendant Mortgage Corp is the 8th case of the 2016 Term. 2014), where the court construed the "sue and be sued" clause in Fannie Mae's federal charter as a basis for conferring federal question jurisdiction. Brief of respondent Fannie Mae in opposition filed. The two share parallel authority to compete in the secondary mortgage market. Lightfoot v. Cendant Mortgage Corporation - Quimbee Facts of the case. Lightfoot v. Cendant Mortgage Group - Ballotpedia We'll assume you're ok with this, but you can leave if you wish. The Court takes up some cases due to the national importance of resolving certain issues. They argue that the district court lacked subject matter jurisdiction over their claims. Admin. on Banking and Currency, 93d Cong., Compilation of the Housing and Community Development Act of 1974, at 277 (Comm. 90448, 802(c)(3), 82 Stat. . 7831, 2009 WL 4067266, at *3 (S.D.N.Y. Yet Fannie Mae and Ginnie Mae kept precisely the same sue-and-be-sued clause, authorizing them both to sue and be sued, and to complain and to defend, in any court of competent jurisdiction, State or Federal. 12 U.S.C. (b)Fannie Maes arguments against reading its sue-and-be-sued clause as merely capacity conferring are unpersuasive. 613. 831472, at 43; see also H.R.Rep. To stave off the foreclosure, Hollis-Arrington and her daughter, Crystal Lightfoot, pursued bankruptcy and transferred the property between themselves. at 248. Helmer Friedman LLP Takes Cases To U.S. Supreme Court . No. In 2005 and 2006, it broke up and spun off or sold its constituent businesses. Fannie Mae's sue and be sued clause . 646, 1346, 62 Stat. Red Cross provides the Supreme Court's most recent pronouncement on the jurisdictional implications of federal sue-and-be-sued clauses. See id. But unlike those clauses, Fannie Maes clause adds the qualification any court of competent jurisdiction, 12 U.S.C. 1723a(a). 3. Majority Op. On its face, the phrase of competent jurisdiction look[s] to outside sources of jurisdictional authority. Califano v. Sanders, 430 U.S. 99, 106 n.6 (1977). You also have the option to opt-out of these cookies. . Ballotpedia: The Encyclopedia of American Politics. 241 U.S., at 304. The District Court denied a motion to remand the case to state court. The addition in 1954 of court of competent jurisdiction, a phrase that, as discussed, carries a clear meaning, means that the current sue-and-be-sued clause does not confer jurisdiction. No. 13, 2012) (order withdrawing disposition). When Fannie Mae sues or is sued, the cause of action must derive from a separate realm of federal law or, more likely, from state law. See Pirelli Armstrong Tire Corp. Retiree Med. Testa does not evidence a midcentury climate of fear that federal entities would be denied access to state courts, especially in cases touching on state property and mortgage law. Congress' motivation and method in amending Fannie Mae's charter have proved obscure to some. In 2005 and 2006, it broke up and spun off or sold its constituent businesses. Fannie Maes sue-and-be-sued clause resembles the clauses this Court has held confer jurisdiction in one important respect. 1348 (All national banking associations shall, for the purposes of all other actions by or against them, be deemed citizens of the States in which they are respectively located. (emphasis added)). Whether federal courts have federal question jurisdiction over Fannie Mae cases has nothing to do with [s]ubstituting private sources of funds for Government expenditures, the primary means by which the House sought to privatize Fannie Mae. But Red Cross itself establishes no such rule. See Am. They contend that Congress bestows upon GSEs unique federal purposes, and thus GSEs should be distinguished from regular private corporations. 831472, at 43. Find Instagram, Twitter, Facebook and TikTok profiles, images and more on IDCrawl - free people search website. LII note: The U.S. Supreme Court has now decided Lightfoot v. Cendant Mortgage Corp.. Do federal courts have subject matter jurisdiction over lawsuits against the Federal National Mortgage Association (Fannie Mae) based soley on the sue-and-be-sued clause in its congressional charter? . 10CV1463, 2011 WL 2133539, at * 12 (S.D.Ind. On this understanding, Fannie Maes sue-and-be-sued clause is most naturally read not to grant federal courts subject-matter jurisdiction over all cases involving Fannie Mae but to permit suit in any state or federal court already endowed with subject-matter jurisdiction. in any court of competent jurisdiction, State or Federal); C. H. Sanders Co. v. BHAP Housing Development Fund Co., 903 F.2d 114 (CA2 1990) (Under 12 U.S.C. 1702 (1988 ed. at 1819. The Federal Deposit Insurance Corporations (FDIC) sue-and-be-sued clause authorized it [t]o sue and be sued, complain and defend, in any court of law or equity, State or Federal. 12 U.S.C. 264(j) (1940 ed.). at 387 n.1. In 1970, when Freddie Macs sue-and-be-sued clause and related jurisdictional provisions were enacted, Freddie Mac was a Government-owned corporation. The plain language of the 1974 amendment shows that Congress intended to give Fannie Mae access to the federal courts by diversity jurisdiction. 1349 and that this reliance is contrary to the appropriate scope of jurisdiction articulated in Am. . Supreme Court of United States. This website may use cookies to improve your experience. The third set of cases interpreted provisions making federal jurisdiction over certain causes of action exclusive. 476, 536 (1968) (codified as amended at 12 U.S.C. PETITIONER:Crystal Monique Lightfoot, et al. No. It also included, as we know, the of competent jurisdiction proviso.4 See id. Fannie Mae counters that Lightfoot and Hollis-Arringtons interpretation of the language in the sue-and-be-sued clause is incorrect because it renders the words State or Federal superfluous. See Steel Co. v. Citizens for Better Environment, 523 U.S. 83, 89 (1998) (Subject-matter jurisdiction is the courts statutory or constitutional power to adjudicate the case (emphasis deleted)); Wachovia Bank, N.A. v. Schmidt, 546 U.S. 303, 316 (2006) (Subject-matter jurisdiction . The absence of any change to Ginnie Mae's charter confirms this interpretation of the Fannie Mae amendment. During the Great Depression, the Federal Government worked to stabilize and strengthen the residential mortgage market. It is true that the legislative history behind the 1954 amendment does not expressly discuss the addition of the of competent jurisdiction proviso. 738, 817 (1824). During this period, law and equity were merged in the federal courts and in a majority of the states. See id. ET AL. See Pub.L. on Hous. If you'd like to support the Cendant Mortgage Corporation. Appendix of Crystal Monique Lightfoot, et al. See D'Oench, 315 U.S. at 455. The cases are Axon v. Federal Trade Commission and Securities and Exchange Commission v. Cochran. 616. & P. Ry. See Tr. at 620. Plaintiffs Beverly Ann HollisArrington and Crystal Monique Lightfoot appeal the district court's judgment dismissing their claims against the Federal National Mortgage Association (Fannie Mae). JUST IN: As one shadow-docket request dies, another is born. Despite the specific reference to federal courts in Fannie Mae's sue-and-be-sued clause, our dissenting colleague contends that the clause does not confer federal question jurisdiction. Per SCOTUSBlog, the holding in Lightfoot v.Cendant Mortgage Corp is: "Fannie Mae's sue-and-be-sued clause does not grant federal courts jurisdiction over all cases involving Fannie Mae." Judgment: Reversed, 8-0, in an opinion by Justice Sotomayor on January 18, 2017. Dev. 553 (2017), and the Ninth Circuit's Order (Dkt. Fund Co., 903 F.2d 114, 118 (2d Cir.1990); Lomas & Nettleton Co. v. Pierce, 636 F.2d 971, 973 (5th Cir.1981); BorSon Bldg. That language had the same generality and natural import as the language in Deveaux because it did not specifically mention the federal courts. We cannot ignore the of competent jurisdiction proviso; we must determine what it means. Section 1332 fills in the rest, making that District of Columbia corporation a District citizen, and therefore eligible for diversity jurisdiction. E. Joshua Rosenkranz, New York, NY, for the Petitioners. 147. The change to the FSLIC's sue-and-be-sued clause was one of very few changes to the FSLIC's charter. Subsequent History: On remand at, Remanded by Lightfoot v. Cendant Mortg. Those district courts that have sided with the majority have done so without an extended discussion of this question. at 8990. The time to file respondents' brief on the merits is extended to and including September 19, 2016. 5. Facsimile886-2-6612-5188 In sum, when Congress has included of competent jurisdiction provisos in sue-and-be-sued clauses, courts have honored Congress' intent and ruled these clauses to not confer subject matter jurisdiction. In doing so, they contend that the clause requires an independent determination of subject matter jurisdiction, and that the Courts decision in Am. The 1954 Act required the Secretary of the Treasury to allow Fannie Mae to repurchase that stock. at 633, 635. Whole Woman's Health v. Hellerstedt. Because Fannie Maes charter contains the competent jurisdiction language, which expressly points to a need for an outside source of jurisdiction, and the charter in Red Cross did not contain this language, Lightfoot argues that Red Cross does not support the Ninth Circuits holding in this case. Congress seemingly responded to the Court's ruling when it chartered the second Bank of the United States. Lightfoot v. Cendant Mortgage Corp., No. Michigan v. Bay Mills Indian Community The only post-Red Cross cases cited by the dissent are district court decisions. The certainty of the dissent may explain the lower court decisions adopting a broader reading of Red Cross. at 817. pages of dissents: https://www.supremecourt.gov/orders/courtorders/110722zor_8m58.pdf. 136), the judgment entered on June 11, 2010 (Dkt. It expected that Fannie Mae would repurchase all of its preferred stock and that legislation would then be enacted to turn Fannie Mae over to the private stockholders. (describing Red Cross as announcing a rule . III. court of competent jurisdiction. 6(d)(1), 88 Stat. . at 379 (summarizing the amendment as permit[ing] the principal office of FNMA to be located in the District of Columbia metropolitan area, as well as in the District of Columbia, though for jurisdiction and venue purposes FNMA is to be considered a District resident). ), Secretary of Veterans Affairs authority to sue and be sued . 476, 536, 537. Fannie Mae then bought the mortgage, while Cendant continued to service it. 4. Brief for Respondents 3637. Housing prices amounted to 12.82 times household income in New Taipei City, with mortgage burdens taking up 52.41 percent, it said. CITATION: US () DISTRIBUTED for Conference of May 1, 2015. 61, 29 U.S.C. 216(b). Natl Red Cross v. S.G., 505 U.S. 247 (1992). Argued November 8, 2016Decided January 18, 2017 . 936, 941 (codified as amended at 28 U.S.C. [1] See Bragdon v. Abbott, 524 U.S. 624, 645 (1998). There was a general concern in the 1950s about the extent of federal authority to require state courts to hear cases brought pursuant to federal statutes. 1331, Fannie Mae would have been restricted by the well-pleaded complaint rule. This case presents the question whether this sue-and-be-sued clause grants federal district courts jurisdiction over cases involving Fannie Mae. Although it was based in New York City, the majority of its headquarters employees were in Parsippany-Troy Hills, New Jersey.. Its last CEO was Henry Silverman. If the phrase court of competent jurisdiction had been used in 1954 as part of an overall plan to privatize Fannie Mae and to limit its access to federal courts, Congress would not have used that same phrase in Ginnie Mae's charter. Appendix of Crystal Monique Lightfoot, et al. at 248. Monique Lightfoot's Instagram, Twitter & Facebook on IDCrawl Lightfoot v. Cendant Mortgage Group - Ballotpedia A court of competent jurisdiction is a court with the power to adjudicate the case before it. v. CENDANT MORTGAGE CORP., DBA . Fannie Mae also argues that because neither the text nor the legislative history of the 1974 amendment to the charter refer to diversity jurisdiction, Lightfoot and Hollis-Arrington are incorrect when they claim that the purpose of this amendment was to establish Fannie Maes citizenship for purposes of diversity jurisdiction. Thus, the outcome here turns on the meaning of court of competent jurisdiction.. 01-18-2017. LIGHTFOOT v. CENDANT MORTGAGE CORPORATION - leagle.com Before 1954, Fannie Mae, like the Red Cross, had the statutory authority to sue and be sued; complain and defend, in any court of law or equity, State or Federal. H.R.Rep. The American Red Cross agrees, arguing that overruling Red Cross on the grounds of statutory interpretation would create separation of powers concerns between the Legislative Branch and Judicial Branch. Its charter allowed it to sue and be sued, plead and be impleaded, answer and be answered, defend and be defended, in all State Courts having competent jurisdiction, and in any Circuit Court of the United States. Osborn v. Bank of United States, 9 Wheat. See id. Both Fannie Mae and Ginnie Mae remained federally chartered, but Fannie Mae became entirely privately owned and Ginnie Mae became entirely federally owned. The court also denied Lightfoot and Hollis-Arringtons Rule 60(b) motion for relief from judgment. Hollis-Arrington alleged that Cendant and Fannie Mae had conspired to allow unqualified buyers access to mortgage loans knowing that Cendant could in turn acquire the properties once they went into foreclosure. nowhere contains an explicit grant of jurisdiction, the Court pointed to two clauses requiring judicial review . Lightfoot v. Cendant Mortgage Corporation - SCOTUSblog Under the rule announced in American National Red Cross v. S.G., 505 U.S. 247 (1992), Fannie Mae's federal charter confers federal question jurisidiction over claims brought by or against Fannie Mae. to proceed in a court specified by statute or in a court of competent jurisdiction and stated that both seem to look to outside sources of jurisdictional authority. Id., at 105106, and n.6. See Warren v. Fed. Avoiding a mouthful of an acronym (FNMA), it went by Fannie Mae. No tags have been applied so far. Fannie Mae's sue-and-be-sued clause does not grant federal courts jurisdiction over all cases involving Fannie Mae (Sotomayor J.) See id. Petitioners Crystal Lightfoot and Beverly Hollis-Arrington argue that the clause is not sufficient to confer federal question jurisdiction. 03CV0141, 2004 WL 1509088, at *2 (W.D.Tex. at 817. at 817. Corp., 492 F.2d 1325, 1329 & n.4 (9th Cir.1974). In doing so, it revised the sue-and-be-sued clause to give Fannie Mae the power to sue and to be sued, and to complain and to defend, in any court of competent jurisdiction, State or Federal. Id., at 620. According to the majority, this phrase ensured that a state court with narrow, specialized jurisdiction was not required to hear any case involving the Bank. at 81718. Please try again. Apr. Fund Co., 903 F.2d 114, 118 (2d Cir.1990); Lomas & Nettleton Co. v. Pierce, 636 F.2d 971, 973 (5th Cir.1981); BorSon Bldg. In its view, an express reference to the federal courts suffices to confer subject-matter jurisdiction on federal courts. 554137 S.Ct. 28 U.S.C. 41(8), and . And such a rule is hard to square with the opinions thorough consideration of the contrary arguments based in text, purpose, and legislative history. Congress also uses these clauses to confirm that a federally created entity cannot invoke sovereign immunity. 1331, at least in theory. . The question here is whether Fannie Maes sue-and-be-sued clause goes further and grants federal courts jurisdiction over all cases involving Fannie Mae. Dissent at 24 (citing C.H. 1056068 (Apr. Fannie Mae first offers several alternative readings of court of competent jurisdiction. It suggests that the phrase might refer to a court with personal jurisdiction over the parties before it, a court of proper venue, or a court of general, rather than specialized, jurisdiction. The House subcommittee summarized the amendment as provid[ing] that the principal office of FNMA be located in the District of Columbia metropolitan area, as well as in the District of Columbia, though for jurisdiction and venue purposes FNMA would be considered a District corporation. Subcomm.
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