United States District Court, District of Columbia
JOSHUA J. ANGEL, Plaintiff,
FEDERAL HOME LOAN MORTGAGE CORPORATION, et al., Defendants.
C. Lamberth United States District Judge
J. Angel, a holder of preferred stock in both the Federal
National Mortgage Association ("Fannie Mae") and
the Federal Home Loan Mortgage Corporation ("Freddie
Mac." and together with Fannie Mae, the
"Companies"), brings the present action as a
pro se litigant. Mr. Angel asserts causes of action for
breach of contract, breach of the implied covenant of good
faith and fair dealing, and tortious interference against the
Companies and their respective individual directors as of
August 17, 2012. along with the Federal Housing Finance
Agency ("FHFA"), as a nominal
defendant. See generally Compl., ECF No. 1.
All defendants moved jointly to dismiss the Complaint in its
entirety. Mot. Dismiss. ECF No. 11. Because Mr. Angel's
claims are time-barred, their motion will be GRANTED.
Additionally, in evaluating defendants' motion, the Court
considered Mr. Angel's arguments in his proposed surreply
attached to his Motion for Leave to File Surreply Brief.
PL's Proposed Surreply, ECF No. 21-1. Accordingly, that
motion [ECF No. 21] will be GRANTED, and the Court directs
the Clerk to place the proposed surreply on the docket.
much in the way of background is required to resolve the
present motion.During the Great Recession of 2008,
Congress passed the Housing and Economic Recovery Act of 2008
("HERA"). creating the FHFA as regulator of the
Companies. Compl. ¶ 36. ECF No. 1. Pursuant to the
authority given under HERA. Fannie Mae and Freddie Mac were
placed into conservatorship with the FHFA taking over control
of the Companies as conservator. Id.
case is one in a multitude of actions brought by shareholders
of the Companies seeking recovery for damages incurred in
connection with an agreement between the FHFA, as conservator
for the Companies, and the Treasury Department on August 17,
2012. Id. ¶ 1: see also Fairholme Funds,
Inc. v. Fed. Hous. Fin. Agency. No. 1:13-cv-1053 (RCL):
ArrowoodIndem. Co.. No. 1:13-cv-1439 (RCL): In
re Fannie Mae/Freddie Mac Senior Preferred Stock Purchase
Agreement Class Action litigs., No. 1:13-mc-1288 (D.D.C.
Feb. 1, 2018). Pursuant to that agreement-the third amendment
of the September 6, 2008 senior preferred stock purchase
agreement (the ''Third Amendment")-each company
would pay Treasury a quarterly dividend equal to 100% of each
company's net worth that exceeded a capital buffer of S3
billion, with that buffer decreasing annually down to zero by
2018. Id. ¶¶ 62-64.
21, 2018, over five and a half years after the Companies
entered into the Third Amendment. Mr. Angel filed suit before
this Court. In Count I of the Complaint, Mr. Angel claims
that by entering into the Third Amendment, "the
Defendants breached the Companies)/]
to Plaintiff to receive dividends on his Junior Preferred
shares." Id., ¶ 108. In Count II, Mr.
Angel claims that by entering into the Third Amendment
"and operating in compliance with its terms[.] the
Defendants effectively deprived Plaintiff of any possibility
of ever again receiving dividends, and thus breached the
implied covenant of good faith and fair dealing inherent in
the Certificates of Designation for the Fannie Mae  and
Freddie Mac Junior Preferred stock." Id. ¶
120, Lastly, Mr. Angel asserts tortious interference by
defendants with the "Government Guarantee" of
"full and timely payment of declared dividends to Junior
Preferred Shareholders." Opp. Mot. Dismiss 32, ECF No.
move to dismiss the Complaint in its entirety because,
inter alia, Mr. Angel's claims are time-barred.
Memo. Supp. Mot. Dismiss 10-12, ECF 11-1. In Mr. Angel's
surreply, he concedes his cause of action for tortious
interference and "seeks to dismiss this claim."
PL's Proposed Surreply 8, ECF No. 21-1. The Court
obliges. That claim will be dismissed, and the Court
considers only the claims for breach of contract and breach
of the implied covenant.
survive a motion to dismiss pursuant to Federal Rule of Civil
Procedure 12(b)(6), "a complaint must contain sufficient
factual matter, accepted as true, to 'state a claim to
relief that is plausible on its face."7 Ashcroft v.
IqbaL 556 U.S. 662, 678 (2009) (quoting Bell All.
Corp. v. Tuvmbly, 550 U.S. 544, 570 (2007)). Defendants
may raise a statute of limitations defense in a motion to
dismiss "when the facts that give rise to the defense
are clear from the face of the complaint." See
Smith-Haynie v. District of Columbia* 155 F.3d 575, 578
(D.C. Cir. 1998).
Mr. Angel failed to file this suit within the limitations
Angel asserts only state law causes of action-breach of
contract and breach of the implied covenant. Although
chartered under federal law, the Companies enacted bylaws in
which they each elected to follow a chosen state's law.
Fairholme Funds. 2018 WL 4680197. at *2. Freddie Mac
chose Virginia law7, while Fannie Mae selected the law of the
State of Delaware. Id. Accordingly, Mr. Angel
alleges his causes of action against Freddie Mac and its
directors under Virginia Law and his causes of action against
Fannie Mae and its directors under Delaware lawr,
See Compl. ¶¶ 101, 116. ECF No. 1. And it
is those states' respective statutes of limitations that
apply. SeeByers v. Burleson. 713 F.2d 856, 859 n.4.
Virginia, the statute of limitations for breach of a contract
"which is in writing and signed by the party to be
charged thereby" is five years. Va. Code § 8.01-246(2).
For claims for breach of the implied covenant, a three-year
statute of limitations applies. Corinthian Morfg. Corp.
v. ChoicePoint Precision Maktg. o. 1:07-cv-832 (JCC),
2008 WL 2776991, *3 (E.D. Va. July 14. 2008); see also
Harbour Gate Owners' Ass'n. Inc. v. Berg, 348
S.E.2d 252, 257 ...