Shares of Fannie Mae and Freddie Mac went into free fall on Tuesday after the U.S. Court of Appeals for the District of Columbia Circuit ruled that Fannie and Freddie shareholders cannot pursue many of their claims related to the so-called “Third Amendment sweep.” But despite the drop, both Fannie and Freddie are still trading above where they were prior to the election of President Donald Trump.

Fresh off handing down a significant ruling in the battle over the constitutionality of the Consumer Financial Protection Bureau, the U.S. Court of Appeals for the District of Columbia Circuit just dealt a sizable body blow to the investors who claimed that the government’s decision to sweep all the profits from Fannie Mae and Freddie Mac into the government’s coffers was not only unnecessary, but illegal as well.

In the weeks since Steve Mnuchin sent shockwaves through the housing industry by stating that the Trump administration planned to end the conservatorship of Fannie Mae and Freddie Mac, reactions varied on whether that can actually be done and how expensive it might be. Here's an interesting take from an interested party on how the GSEs might actually exit conservatorship and what that would mean to the GSE stockholders who've waited quite a few years for a resolution.

Over the last year, various groups, including community lenders, affordable housing advocates, civil rights groups, interested observers, and financial analysts, called for a change in governmental policy that would allow Fannie Mae and Freddie Mac to rebuild a capital base. Now, there's a new voice pushing to recapitalize the GSEs, or several, as it were, coming from an interesting source.

Well, it seems we can't go more than a few days without a prominent, national media personality commenting on the stability and standing of Fannie Mae and Freddie Mac, how the GSEs ended up in conservatorship, and what’s next. Last month, Rolling Stone’s Matt Taibbi weighed in. And now, no less than George Will has written about "#FannieGate."

If you listen closely, you can hear the noise surrounding the recapitalization and release of the government-sponsored enterprises from conservatorship getting louder thanks to Freddie Mac reporting a loss of $354 million in the first quarter. Now all those who want to see an end to the GSE conservatorship for whatever their particular motivation is have a new card to play. And they will play it.

If Rolling Stone's Matt Taibbi is to be believed, yes, there absolutely was a government conspiracy behind the Fannie Mae and Freddie Mac bailout. And now, the government is fighting tooth and nail to keep the evidence of that conspiracy a secret, all while plotting something far more insidious. But is he saying something we don't already know?

In the years since the government modified its agreement with Fannie Mae and Freddie Mac to sweep all the profits from the GSEs into the government’s coffers, many observers questioned whether the so-called "Third Amendment sweep" was even necessary. Now, a series of unsealed depositions show that not only were Fannie and Freddie on track to be profitable for at least 10 years, the government allegedly knew that fact, and more, before choosing to sweep away the GSEs' profits.

A ruling late Friday with U.S. District Judge Amy Jackson holding that Fannie Mae shareholders cannot sue the Department of Treasury in a derivative action may not be the blow to the shareholder case against Treasury that HousingWire first cast it as.