WILLIAMS v. FANNIE MAE — Entry #33: MOTION for Summary Judgment by FANNIE MAE, RICHARD LAWCH, GRACE HUERSCHER

Case 1:05-cv-01483-JDB            Document 33-24        Filed 06/21/2007      Page 1 of 6


                         IN THE UNITED STATES DISTRICT COURT
                             FOR THE DISTRICT OF COLUMBIA

____________________________________
MARIALICE BATHRUS WILLIAMS,          :
                                     :                Civil Action No. 1:05CV01483
      Plaintiff,                     :
                                     :
      vs.                            :                Judge John D. Bates
                                     :
FEDERAL NATIONAL MORTGAGE            :
      ASSOCIATION, et al.            :
                                     :
                                     :
      Defendants.                    :
____________________________________:

            DEFENDANTS FEDERAL NATIONAL MORTGAGE ASSOCIATION,
                  RICHARD LAWCH, AND GRACE HUEBSCHER’S
                 STATEMENT OF UNDISPUTED MATERIAL FACTS

       Defendants’ 1 motion for summary judgment is based on the following undisputed

material facts:

       1.         Plaintiff Marialice Bathrus Williams (“plaintiff”) was employed by Fannie Mae as

a director in its multifamily unit from January 1990 through June 1998, when she voluntarily left

to join CAM Financial Services, Inc. (“CAM”). (Am. Compl. ¶¶ 11; March 28, 2007 Williams

Dep. at 73:19-22.)

       2.         In 1997, Fannie Mae and CAM entered into a memorandum of understanding

concerning multifamily credit risk insurance. (See CAM Amended Complaint ¶ 16.)

       3.         From 1997 through 1999, Fannie Mae used CAM as an insurance broker for the

procurement of non-DUS multifamily credit risk insurance. (See CAM Amended Complaint.)

       4.         After plaintiff resigned from Fannie Mae, she was unable to reach a mutually-

acceptable agreement with CAM. (See March 21, 2003 Williams Dep. at 226:5-10.)


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        5.      In October 1998, plaintiff formed Risk Mitigation Strategists, LLC (“RMS”), a

limited liability company, wholly-owned by plaintiff, to “pursue the business [plaintiff] had been

doing at Fannie Mae prior to [her] departure.” (Amended Compl. ¶¶ 31-32; March 28, 2007

Williams Dep. at 20:17-20; May 7, 2007 Williams Dep. at 300:19-20; District of Columbia

Certificate of Revocation.)

        6.      Although CAM and plaintiff talked about a joint venture, they never actually

entered into an agreement. (See Jones Dep. at 31:2-25.)

        7.      RMS and CAM did not have “any connection with respect to ownership and no

one from CAM or RMS has an interest in the other’s business ventures.” (Jones Dep. Exh. 2, at

FNMA.MBW.008003.)

        8.      CAM’s president Bob Jones could only recall two Fannie Mae-related projects or

presentations that RMS or plaintiff worked on with CAM: The May 2001 Delegated

Underwriting and Servicing (“DUS”) proposal and a presentation on captive insurance. (See

Jones Dep. at 58-59.)

        9.      In May 2001, RMS made a proposal to Fannie Mae to “lay[] off risk associated

with [Fannie Mae’s] [DUS] Program,” (Williams Interrog. Resp. No. 3) and “secure the

insurance and the DUS lenders as clients and bring the deal back to Fannie Mae” (hereinafter,

“May 2001 Proposal”). (Williams Interrog. Resp. No. 4; see also March 28, 2007 Williams Dep.

at 36:13-20; May 7, 2007 Williams Dep. at 154:10-14; Jones Dep. Exh. 2.)

        10.     On May 15, 2001, Jones copied plaintiff on an e-mail to Stephen Noble from

Zurich Insurance concerning RMS’ “Proposal to Provide Insurance Coverage for . . . Fannie

Mae’s Delegated Underwriting Servicing Program.” (March 28, 2007 Williams Dep. Exh. 1.)


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       Collectively, Federal National Mortgage Association (“Fannie Mae”), Richard Lawch (“Lawch”), and
Grace Huebscher (“Huebscher”).


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This e-mail outlined RMS’ May 2001 proposal, and indicated that plaintiff and CAM president

Jones hoped to be able to share performance data “based on your interest in a potential

transaction.” (Id.)

        11.     Fannie Mae’s DUS program involves a small group of multifamily lenders who

have the right to commit Fannie Mae, on a loan-by-loan basis, to purchase multifamily loans.

(See March 25, 2003 Huebscher Dep. at 14:7-15.) In exchange, these DUS lenders share the risk

of loss with Fannie Mae. (See id.; March 28, 2003 Williams Dep. at 27:4-13.)

        12.     On May 31, 2001, Ms. Huebscher forwarded an e-mail from plaintiff indicating

RMS’s interest in pursuing insurance for the DUS program to her supervisor, Mr. Lawch. (See

Jones Dep. Exh. 7, at FNMA.MBW.006230.)

        13.     In May 2001, the Office of Federal Housing Enterprise Oversight (OFHEO) was

in the midst of finalizing a new, risk-based capital rule, and Fannie Mae was concerned about the

regulation’s potential impact on its DUS program. (See March 26, 2003 Huebscher Dep. at

463:7-14.)

        14.     In July 2001, shortly after Fannie Mae received plaintiff’s e-mail, OFHEO issued

its final risk-based capital rule. The final rule contained significant revisions from OFHEO’s

previously proposed rule, including, among other things, cutting in half the capital impact of risk

sharing with DUS lenders. (See Risk-Based Capital, 66 Fed. Reg. 47730 (September 13, 2001)

(codified at 12 C.F.R. part 1750); Risk-Based Capital, 64 Fed. Reg. 18084 (April 13, 1999);

Fannie Mae’s Interrog. Resp. No. 7.)

        15.     The final rule obviated the need for Fannie Mae to obtain insurance for capital

purposes and Fannie Mae did not pursue DUS insurance coverage at the time because it was


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inconsistent with the risk sharing nature of Fannie Mae’s business model. (See March 26, 2003

Huebscher Dep. at 449:12-25; see, e.g., Fannie Mae’s Interrog. Resp. No. 7.)

       16.     Fannie Mae did not pursue the DUS proposal with either RMS or Craig Ott. (See

March 26, 2003 Huebscher Dep. at 449:12-25; see, e.g., Fannie Mae’s Interrog. Resp. No. 7.)

       17.     Plaintiff testified that she recognized in mid-2001 that Fannie Mae was not going

to consummate the proposed DUS transaction with her. (See, e.g., March 17, 2003 Williams

Dep. at 88, 91, 102, 104, 121.)

       18.     CAM stopped working on the May 2001 proposal in August 2001 because it

heard from plaintiff that Fannie Mae was not pursuing the proposal. (See Jones Dep at 54.)

       19.     The captive insurance presentation by Kate Westover, at which plaintiff, Kate

Westover, and Fannie Mae representatives were present, occurred on August 21, 2001. (See

May 6, 2003 Williams Dep. at 128:25-129:13; May 6, 2003 Williams Dep. at 128:25-129:13;

Jones Dep. at 54-55; Affidavit of Kathryn Westover; FNMA.MBW.008057.)

       20.     Plaintiff determined that defendants did not wish to pursue a business relationship

or particular contracts with her after they stopped returning her phone calls and e-mails following

the captive insurance meeting. (See Amended Compl. ¶ 53; May 7, 2007 Williams Dep. at

196:19-21; May 5, 2003 Williams Dep. at 32-33.)

       21.     Fannie Mae and CAM did not enter into any insurance transactions after 1999.

(See CAM Amended Complaint ¶¶ 48, 85, 96.)

       22.     Defendants did not have any business discussions with plaintiff or CAM after

CAM filed suit against Fannie Mae in December 2001. (See CAM Amended Complaint;

Huebscher Decl. ¶¶ 4, 5; Lawch Decl. ¶¶ 3, 4.)


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         23.   Defendants did not promise plaintiff any business or even meet with her after this

date. (See Huebscher Decl. ¶¶ 3, 4; Lawch Decl. ¶¶ 2, 3.)

         24.   Plaintiff described her co-brokerage agreement with CAM as “a simple, common

co-brokerage agreement with CAM Financial that entailed paying them a commission in the

event that they secured the insurance that I needed on any of the proposals that I was working

on.” (See Williams Interrog. Resp. No. 7.)

         25.   Plaintiff further explained that the co-brokerage agreement “indicates that when

CAM locates an insurance company for a project that RMS is working on, RMS agrees to

compensate CAM through some form of split commission.” (Jones Dep. Exh. 2.)

         26.   The District of Columbia Department of Consumer and Regulatory Affairs

revoked RMS’s articles of incorporation after the company “failed and/or refused to file reports

and pay all fees and dues owing prior to June 16, 2002 and 2003.” (See District of Columbia

Certificate of Revocation.)

         27.   Plaintiff’s brokerage license expired in April 2003. (See District of Columbia

Dept. of Insurance, Securities & Banking Licensee Look-up.)

         28.   Mr. Jones indicated that he did not believe that the co-brokerage agreement

formally terminated prior to his departure from the company in 2005. (See Jones Dep. at 35:18-

19.)

         29.   Bob Jones has no recollection of any conversations regarding RMS or plaintiff

with defendant Huebscher or defendant Lawch. (See Jones Dep. at 43, 46.)

         30.   Bob Jones has no recollection of any instance where defendants discouraged

CAM from business relationships with plaintiff, (see Jones Dep. at 43, 62), or made disparaging

remarks about plaintiff. (See Jones Dep. at 44, 62-63.)


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       31.    Plaintiff testified that in early 2001, she heard Mr. Lawch remark about an

“international broker” and that “she knew that that was a discriminatory remark.”. (See Williams

Interrog. Resp. No. 1; May 7, 2007 Williams Dep. at 200; March 17, 2003 Dep. at 107-08.)

       32.    Fannie Mae never hired an “international broker” for the multifamily division’s

securitization and other loan programs. (See Fannie Mae’s Interrog. Resp. at No. 9.)


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