Judge sends Fannie Mae discriminatory firing case to arbitration

A federal judge has granted Fannie Mae’s motion to compel arbitration and dismiss a lawsuit brought by 44 former employees who allege they were fired in a discriminatory manner tied to the company’s charitable giving program.

In a memorandum opinion issued Friday, Judge Randolph D. Moss of the U.S. District Court for the District of Columbia held that the plaintiffs did not present evidence to create a factual dispute over whether they agreed to arbitrate “any employment-related disputes.”

The case stems from a virtual meeting on April 3, 2025, where more than 80 Fannie Mae workers were told they were being terminated for cause, the plaintiffs claim. The alleged reason was fraud related to Fannie Mae’s Charitable Giving program. But the plaintiffs — all of Indian national origin and mostly Telugu speakers, and most over the age of 50 — argue the mass termination was discriminatory.

The plaintiffs sued in August 2025 under Title VII of the Civil Rights Act and the Age Discrimination in Employment Act and also asserted breach-of-contract claims.

The complaint was originally filed on behalf of 66 plaintiffs, but 22 voluntarily dismissed their claims after the initial filing. Related cases against Bill Pulte, director of the Federal Housing Finance Agency (FHFA), and former Fannie Mae CEO Priscilla Almodovar were closed, per court filings.

Fannie Mae moved to dismiss the complaint and compel arbitration under the Federal Arbitration Act, arguing that each plaintiff was bound by a 2015 update to the company’s arbitration agreement.

The government-sponsored enterprise relied on sworn declarations and electronic records to show that on Jan. 21, 2015, it emailed all employees about the updated agreement, which took effect in April of that year. Employees were directed to an internal portal to confirm they had received the agreement and understood that it governed their continued employment.

Fannie Mae also produced records indicating that eight plaintiffs later signed internal transfer offer letters, which expressly reaffirmed they were subject to the arbitration agreement.

The plaintiffs opposed the motion, contending there was no enforceable contract because there had been a “lack of a meeting of the minds” on arbitration. They sought an evidentiary hearing to present live witness testimony on whether they agreed to arbitrate.

Moss rejected that request and sided with Fannie Mae, emphasizing that the plaintiffs did not back up their arguments with evidence.

“Because Plaintiffs have failed to proffer any evidence or to identify any dispute of material fact regarding arbitrability, the Court will grant Defendant’s motion to compel arbitration and to dismiss this action and will deny Plaintiffs’ motion for a hearing,” Moss wrote.

The ruling means the former employees will have to pursue any claims through arbitration proceedings rather than in federal court.

Fannie Mae and an attorney for the plaintiffs did not immediately respond to HousingWire’s requests for comment.

This article was written by Flávia Furlan Nunes and generated with the assistance of HousingWire Automation, then reviewed by a HousingWire editor before publication.