Helmer Friedman LLP Persuades U.S. Supreme Court To Accept Case Against Fannie Mae

LOS ANGELES, June 29, 2016 /PRNewswire/ — Agreeing to address whether suits against Fannie Mae are automatically subject to federal court jurisdiction, the U.S. Supreme Court today granted Helmer Friedman LLP’s petition for certiorari in Lightfoot v. Cendant Mortgage Corp. Case No. 10-56068. Underscoring the importance of the firm’s jurisdictional arguments, the U.S. Solicitor General’s Office also urged the Supreme Court to take the case and rule in favor of the firm’s clients.

Helmer Friedman LLP represents Crystal Monique Lightfoot and her mother, Beverly Hollis-Arrington, in a long-running California lawsuit seeking to prevent government-sponsored mortgage lender Fannie Mae and others from foreclosing on their home. The Helmer Friedman LLP team now has the opportunity to convince the Supreme Court that the case belongs in state court, not federal court, which their clients – even when representing themselves earlier in the litigation – argued all along.

The issue has potentially far-reaching implications because thousands of suits are filed against Fannie Mae in federal court, and many other entities are governed by similarly worded jurisdictional provisions.

The Lightfoot case centers on whether the statute governing Fannie Mae automatically confers jurisdiction in the federal courts whenever Fannie Mae is a party, even when the case involves purely state law issues. The statute says Fannie Mae “shall have the power to … sue and to be sued … in any court of competent jurisdiction, State or Federal.”

In a 2014 ruling, a divided Ninth U.S. Circuit Court of Appeals determined that Fannie Mae could always be sued in the federal courts, citing a prior Supreme Court case called Am. Nat’l Red Cross v. S.G., 505 U.S. 247 (1992)(a highly divided 5-4 decision with Justice Scalia writing the dissent).

But in challenging that ruling in the cert petition, the Helmer Friedman LLP team argued that the Ninth Circuit had misunderstood Red Cross and/or that the Supreme Court should reverse the earlier Red Cross decision. Helmer Friedman LLP’s appellate team, led by name partners Andrew H. Friedman and Gregory D. Helmer, look forward to persuading the Supreme Court that our reading of the plain language of the statute is correct.

“The Supreme Court’s grant of certiorari in this case is the culmination of several years of work,” said Gregory D. Helmer. “We knew it was a longshot, but decided the issue was important enough to battle the odds. For years, Fannie Mae has argued that individuals do not have the right to proceed against them in state court. But, in our view, the language of Fannie Mae’s corporate charter authorizes an individual to commence a legal action in a state court so long as that court has a legitimate basis for jurisdiction. We look forward to making that argument to the Supreme Court and hope the Court shares our perspective.”

Commenting about the Court’s decision, founding Helmer Friedman LLP partner, Andrew H. Friedman, exclaimed: “We were thrilled a month ago when the U.S. Solicitor General filed a brief with the Court recommending that our petition be granted. This morning, we are beyond ecstatic.”

The case will be briefed over the summer and fall, and will likely be argued in late 2016 or early 2017.

In addition to Andrew H. Friedman and Gregory D. Helmer, the Helmer Friedman LLP team includes co- counsel Josh Rosenkranz, Robert Loeb, Tom Bondy and Matthew Bush of Orrick, Herrington & Sutcliffe LLP.

Copies of Helmer Friedman LLP’s petition for certiorari and all other pertinent documents can be accessed at https://www.helmerfriedman.com/us-supreme-court-grants-petition-certiorari/

Contact:

For more information, please contact us by e-mail: Andrew H. Friedman (email) or Gregory D. Helmer (email) or by telephone at 310-396-7714.

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