But the Court said the plaintiffs could seek remedy on the part of their lawsuit that argues the FHFA's structure was unconstitutional.
At stake is the arrangement under which Fannie Mae and Freddie Mac have transferred their profits to the Treasury Department.
“The brazen attitude exhibited by Wall Street traders toward public institutional buyers of GSE bonds was shocking,” the lead plaintiff says.
A Treasury Department plan would recapitalize Fannie Mae and Freddie Mac and return them to private control.
The companies are in their eleventh year of conservatorship following the financial crisis.
Fannie Mae, Godiva Chololatier, Titan, Legacy Health, Casa Systems, ProAssurance, Century Aluminum, Atkore, Preferred Apartment, Tableau Software
The writedown will require the mortgage giant to seek a $3.7 billion cash infusion from the Treasury, its first draw since 2012.
How Bryan Sullivan, previously a PIMCO portfolio manager, uses that experience as the finance chief of loanDepot.
The FHFA said two-thirds of the mortgage loans underlying securities the banks sold had underwriting defects.
The lawsuit accused Freddie Mac executives of misleading investors about the amount of subprime housing loans on the GSE's books.
Future profitability of the government-sponsored enterprises is far from assured, says an inspector general report.
While housing finance needs fixing, "simply returning [the GSEs] to the way they were before" is neither practical nor realistic, says a Treasury adviser.
