It's a mad, mad, mad, mad world out there, particularly when it comes to mortgage financing GSE Fannie Mae.

Bruce Berkowitz's Fairholme Funds [profile] has filed a suit against the U.S. accusing the government of seizing the profit of Fannie and its sister GSE Freddie Mac due to the terms of its 2008 government bailout, according to Bloomberg reports.

In a complaint filed yesterday in the U.S. Court of Federal Claims in Washington, Fairholme declared it is seeking “just compensation” for its investors because the U.S. Treasury changed the terms of the bailout after taking over the companies in 2008, announcing it would collect all of their current and future profit, according to Bloomberg

Berkowitz and company aren't the only finance folk launching legal warfare over the the GSEs. Hedge fund Perry Capital LLC filed a similar suit in federal court on July 7, according to Bloomberg.

Meanwhile, the Berkowitz case can be found under the title of Fairholme Funds Inc. v. U.S., 1:13-cv-00465, U.S. Court of Federal Claims.

Read the full story at Bloomberg. 

Edited by: Tommy Fernandez


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