Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_09-cv-05908/USCOURTS-cand-3_09-cv-05908-6/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:1441 Petition for Removal

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1 Unless otherwise indicated, all facts are drawn from

the FDIC’s declarations. Doc. No. 41. Plaintiff did not

submit any competent evidence in his opposition to the motion

for summary judgment. Neither party explained why a joint

1

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

MARTIN ENG,

Plaintiff(s),

v.

UNITED COMMERCIAL BANK, et

al,

Defendant(s).

)

)

)

)

)

)

)

)

)

)

)

)

No. C09-5908 BZ

ORDER GRANTING DEFENDANT’S

MOTION FOR SUMMARY JUDGMENT

Defendant Federal Deposit Insurance Company (“FDIC”)

moved for summary judgment on the complaints of plaintiff

Martin Eng (“Eng”) and its cross-complaint against Eng. For

the following reasons, the motion is GRANTED.

Eng brought two actions, which were consolidated, against

United Commercial Bank (“United”) for among other claims,

fraud, breach of contract, and intentional infliction of

emotional distress.1 Doc. No. 1. Eng alleges that United

Case 3:09-cv-05908-BZ Document 47 Filed 06/04/10 Page 1 of 5
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

statement of undisputed facts as required by the Court’s

pretrial order was not submitted. Doc. No. 42.

2

fraudulently induced him to refinance a piece of property

which ultimately led to foreclosure. United cross-complained

for breach of contract and common counts. Doc. No. 5-51. In

2007, United extended to Eng a written line of unsecured

credit (“EZ line”) for $50,000. Cavestany Decl. ¶ 6. Eng

agreed to repay United for any amounts drawn on the line of

credit pursuant to the terms of the agreement. Eng drew down

the entire balance of the EZ line. Id. at 11-15. In 2008,

United extended Eng another line of credit (“Microline”) for

$50,000, which Eng also drew down. Id. On November 6, 2009

the FDIC was appointed by the California Department of

Financial Institutions as receiver for United. Id. ¶ 3 The

FDIC acquired both the EZ line and the Microline. Id. ¶ 25.

The FDIC moves for summary judgment on Eng’s complaints

for failure to file an administrative claim as required under

the Financial Institution Reform, Recovery, and Enforcement

Act (“FIRREA”) and 12 U.S.C. § 1821. Under § 1821 (d)(13)(D):

(D) Limitation on judicial review

Except as otherwise provided in this subsection, no

court shall have jurisdiction over--

(i) any claim or action for payment from, or

any action seeking a determination of rights

with respect to, the assets of any depository

institution for which the Corporation has been

appointed receiver, including assets which the

Corporation may acquire from itself as such

receiver; or

(ii) any claim relating to any act or omission

of such institution or the Corporation as

receiver. 

Case 3:09-cv-05908-BZ Document 47 Filed 06/04/10 Page 2 of 5
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3

The FDIC established that Eng did not file an

administrative Proof of Claim by February 11, 2010, the

deadline designated by the FDIC. Mallory Decl. ¶ 12. 

Compliance with the FIRREA’s exhaustion requirements is

mandatory for claims filed before and after the receiver is

appointed. Intercontinental Travel Marketing v. FDIC, 45 F.3d

1278, 1283 (9th Cir. 1994). 

In his opposition, Eng raises several arguments that do

not address the failure to file a Proof of Claim. For that

reason alone, summary judgment must be granted on Eng’s

complaint. At oral argument, Eng stated that he did not

believe he had to file a Proof of Claim but did not provide

any authority for that proposition. 

In his papers, Eng first argues that summary judgment is

premature and requests additional discovery under Rule 56(f). 

“A Rule 56(f) motion must show how additional discovery would

preclude summary judgment and why a party cannot immediately

provide ‘specific facts’ demonstrating a genuine issue of

material fact.” Mackey v. Pioneer Nat. Bank, 867 F.2d 520,

524 (9th Cir. 1989)(internal citations omitted). Eng does

not explain how additional discovery would likely have an

effect on the Proof of Claim issue. Nor can the Court

conceive how additional discovery would help Eng defeat the

FDIC’s motion. When asked at oral argument what additional

discovery Eng needed, he was unable to articulate any

discovery that would bear on the issues presented by the

summary judgment motion. 

Eng next argues essentially that it would be unfair to

Case 3:09-cv-05908-BZ Document 47 Filed 06/04/10 Page 3 of 5
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

4

grant the FDIC’s motion on his claims because that would

amount to an unconstitutional taking. Eng misunderstands the

process that the FIRREA has in place. As receiver for a

failed institution such as United, the FDIC must determine

which claims against United will be allowed or disallowed. 

Mallory Decl. Ex. A. The FDIC has a consolidated process

whereby it requires all claimants to file a Proof of Claim

Form along with supporting documentation by a certain date. 

This allows the receiver to make an initial determination on

the claim. If the receiver disallows the claim, the claimant

has either 60 or 180 days to file suit on the claim. Failure

to file a Proof of Claim results in a final disallowance of a

claim.

Here, Eng did not file a Proof of Claim, despite being

notified of this requirement by letter dated January 26, 2010. 

The final dismissal of Eng’s claims is not an unlawful taking. 

Rather, it is the consequence of Eng’s failure to follow a

statutorily proscribed procedure for the efficient

administration of claims against failed institutions. Eng

failed to follow the law and the instructions that the FDIC

provided. Therefore, the FDIC’s motion for summary judgment

on Eng’s complaint is GRANTED.

The FDIC also moves for summary judgment on its

counterclaims under the EZ line and Microline lines credit

agreements. Eng did not address this portion of the motion at

all. The FDIC established that Eng borrowed nearly the full

limit on both lines of credit and is now currently in default

on both. Both loans were fully due on October 1, 2008. 

Case 3:09-cv-05908-BZ Document 47 Filed 06/04/10 Page 4 of 5
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

5

Defendant has not paid the money owed under the lines of

credit. Therefore, the FDIC’s motion for summary judgment on

its counterclaims is GRANTED. 

Dated: June 4, 2010 

 Bernard Zimmerman 

 United States Magistrate Judge

G:\BZALL\-BZCASES\ENG V. UNITED COMMERCIAL\MSJ ORD.wpd

Case 3:09-cv-05908-BZ Document 47 Filed 06/04/10 Page 5 of 5