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phrase "court of competent jurisdiction" allowed any court with "an existing source of subject-matter jurisdiction" to hear cases against Fannie Mae. Consequently, Justice
Sotomayor held that federal law "permits suit in any state or federal court already endowed with subject-matter jurisdiction over the suit."
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In a unanimous opinion written by
Justice Sonia Sotomayor, the Court reversed the Ninth Circuit's ruling and rejected Fannie Mae's assertion that it could automatically remove any case to a federal court. After reviewing other party-specific sue-and-be-sued clauses, Justice Sotomayor stated that the
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borrowers filed a lawsuit in state court, which alleged deficiencies in the foreclosure and sale of their home. Relying upon a federal law that granted Fannie Mae the right "to sue and to be sued, and to complain and to defend, in any court of competent jurisdiction, State or
Federal" (the
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held that Fannie Mae's sue-and-be-sued clause "confers jurisdiction on the federal courts." District Judge
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