John Carney at the Wall Street Journal is reporting that a federal claims judge has ruled against the federal government, saying that a lawsuit brought by investors over the treatment of Fannie Mae and Freddie Mac can proceed.

Here’s the latest:

A judge in the U.S. Court of Federal Claims denied the government’s motion to stay proceedings in that court, according to two people familiar with the decision. Lawyers for the government had asked the Court of Claims to put the lawsuits on hold pending the appeal of a decision by a judge in the U.S. District Court for the District of Columbia that dismissed a similar group of cases last September.

Shares of Fannie jumped by more than 8% Wednesday morning. Shares of Freddie rose by more than 4%.

Wednesday’s decision means the plaintiffs, who include Fairholme Funds, will be able to continue to collect information from the government in hopes of bolstering their argument that the Court of Claims has jurisdiction over the cases.

Shareholders are suing over the Treasury Department’s sweep of shareholder profits after Fannie and Freddie were put in conservatorship. 

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