Now, big and powerful investors, led by Perry Capital, a $9 billion hedge fund run by former Goldman Sachs trader Richard Perry, and Fairholme Funds, the big mutual fund firm run by Bruce Berkowitz, are suing the government, alleging it acted illegally by getting Fannie Mae and Freddie Mac to pay the government nearly all of its massive profits in the form of dividends. Perry Capital, Fairholme Funds, other big hedge funds and some retail investors, have bought junior preferred securities and common shares of Fannie Mae and Freddie Mac that still trade over the counter, betting those securities will jump in value if any of that money ever flows to them. Perry Capital has even hired one of the nation's most respected lawyers, former U.S. Solicitor General Theodore Olson, to make its case.