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Nature of Suit Code: 430
Nature of Suit: Banks and Banking
Cause of Action: 

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United States Court of Appeals 

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 21, 2013 Decided January 31, 2014 

No. 13-5080 

KIM S. WESTBERG, HUSBAND, AND LAVERNE V. WESTBERG,

WIFE, 

APPELLANTS

v. 

FEDERAL DEPOSIT INSURANCE CORPORATION, AS RECEIVER 

FOR AND ON BEHALF OF SILVER STATE BANK, AND MULTIBANK 

2009-1 RES-ADC VENTURE, LLC, 

APPELLEES

Appeal from the United States District Court 

for the District of Columbia 

(No. 1:09-cv-01690) 

Christopher Alan LaVoy argued the cause for the 

appellants. 

Kathleen V. Gunning, Counsel, Federal Deposit Insurance 

Corporation, argued the cause for the appellees. Colleen J. 

Boles, Assistant General Counsel, Kathryn R. Norcross, Senior 

Counsel, John B. Isbister and Jaime W. Luse were on brief. 

Before: HENDERSON, BROWN and GRIFFITH, Circuit 

Judges. 

USCA Case #13-5080 Document #1477729 Filed: 01/31/2014 Page 1 of 15
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KAREN LECRAFT HENDERSON, Circuit Judge: In May 

2008, Kim and Laverne Westberg (Westbergs) obtained a 

residential construction loan from Silver State Bank (Silver 

State), located in Henderson, Nevada. Silver State collapsed 

shortly thereafter and the Federal Deposit Insurance 

Corporation (FDIC) was appointed as receiver. The FDIC 

repudiated the loan agreement but notified the Westbergs that 

they were obligated to continue making payments on the 

portion of the loan that had been disbursed to them before 

Silver State’s failure. The Westbergs brought suit in district 

court seeking, inter alia, a declaratory judgment that the 

FDIC’s repudiation relieved them of any obligation to continue 

making loan payments. The FDIC subsequently assigned its 

interest in the loan to Multibank 2009-1 RES-ADC Venture, 

LLC (Multibank) and the Westbergs amended their complaint 

to add Multibank as a defendant. The district court dismissed 

the Westbergs’ claim for declaratory relief against Multibank 

for lack of subject matter jurisdiction, concluding that their 

claim was subject to the administrative exhaustion requirement 

set forth in the Financial Institutions Reform, Recovery, and 

Enforcement Act of 1989, Pub. L. No. 101-73, 103 Stat. 183 

(FIRREA or Act), and that they did not exhaust that 

administrative remedy. We affirm. 

I. Background 

A 

The Congress enacted FIRREA “in the midst of the 

savings and loan insolvency crisis to enable the FDIC . . . to 

expeditiously wind up the affairs of literally hundreds of failed 

financial institutions throughout the country.” Freeman v. 

FDIC, 56 F.3d 1394, 1398 (D.C. Cir. 1995) (citing H.R. REP.

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NO. 101-54(I), reprinted in 1989 U.S.C.C.A.N. 86, 87, 103). 

FIRREA confers broad powers on the FDIC in its capacity as 

receiver for failed depository institutions. See id. at 1398–99. 

Its powers include the authority to repudiate any contract “(A) 

to which [the failed] institution is a party; (B) the performance 

of which the [FDIC], in [its] discretion, determines to be 

burdensome; and (C) the disaffirmance or repudiation of which 

the [FDIC] determines, in [its] discretion, will promote the 

orderly administration of the institution’s affairs.” 12 U.S.C. 

§ 1821(e)(1); see also Nashville Lodging Co. v. Resolution 

Trust Corp., 59 F.3d 236, 241 (D.C. Cir. 1995). 

FIRREA also authorizes the FDIC to adjudicate creditors’ 

claims against failed depository institutions for which the 

FDIC has been appointed receiver. See 12 U.S.C. 

§ 1821(d)(3)–(13); see also Freeman, 56 F.3d at 1399–1400 

(summarizing administrative claims process). FIRREA 

includes a broadly worded 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 [FDIC] has been appointed receiver, 

including assets which the [FDIC] may acquire 

from itself as such receiver; or 

(ii) any claim relating to any act or omission of 

such institution or the [FDIC] as receiver. 

12 U.S.C. § 1821(d)(13)(D). The “[e]xcept as otherwise 

provided” clause refers back to section 1821(d)(6), “which 

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provides for administrative determination of ‘any claim against 

a depository institution for which the [FDIC] is receiver’ and 

thereafter for adjudication in district court.” Auction Co. of 

Am. v. FDIC, 141 F.3d 1198, 1200 (D.C. Cir. 1998) (quoting 

12 U.S.C. § 1821(d)(6)(A)(i)). We have read sections 

1821(d)(6) & (13)(D) together “as setting forth a ‘standard 

exhaustion requirement’” that “‘routes claims through an 

administrative review process, and . . . withholds judicial 

review unless and until claims are so routed.’” Am. Nat’l Ins. 

Co. v. FDIC, 642 F.3d 1137, 1141 (D.C. Cir. 2011) (quoting 

Auction Co. of Am., 141 F.3d at 1200); accord Freeman, 56 

F.3d at 1400 (“The effect of these provisions, read together, is 

to require anyone bringing a claim against or seeking a 

determination of rights with respect to the assets of a failed 

bank held by the FDIC as receiver to first exhaust 

administrative remedies by filing an administrative claim 

under the FDIC’s administrative claims process.” (quotation 

marks omitted)). This is a jurisdictional exhaustion 

requirement that we cannot excuse. See Avocados Plus Inc. v. 

Veneman, 370 F.3d 1243, 1247 (D.C. Cir. 2004). 

B 

 Pursuant to a loan agreement, a promissory note and a 

deed of trust (collectively, “Loan Documents”), the Westbergs 

obtained a loan in the principal amount of $1,318,000 from 

Silver State to build a house in Gilbert, Arizona. The Loan 

Documents provided for periodic loan amounts as construction 

progressed. On September 5, 2008, the FDIC notified the 

Westbergs that Silver State had been closed and that the FDIC 

had been appointed as receiver. As of that date, Silver State 

had disbursed $171,510.95 to the Westbergs and the 

Westbergs had fully complied with their obligations under the 

terms of the Loan Documents. 

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 On April 21, 2009, the FDIC-as-receiver notified the 

Westbergs that it had elected to repudiate the loan agreement 

pursuant to 12 U.S.C. § 1821(e). The notice letter specified 

that the Westbergs were obligated to continue making 

payments “[w]ith respect to any outstanding balance 

previously funded”—i.e., the balance owing on the 

$171,510.95 the Westbergs had already received. Joint 

Appendix (JA) 57. The notice letter also warned that if they 

failed to file a proof of claim by the specified bar date, their 

failure would result in disallowance of any claim and waiver of 

further rights and remedies. On June 18, 2009, the Westbergs 

submitted a proof of claim on the FDIC’s standard form. The 

claim sought compensation for costs resulting from the 

construction delays caused by the FDIC’s repudiation. 

Notably, however, the Westbergs’ administrative claim did not 

seek to be relieved of their obligation to repay the loan amount 

already disbursed to them. By letter dated July 6, 2009, the 

FDIC notified the Westbergs that their damages claim had 

been disallowed and that they had 60 days to file a lawsuit. 

 On September 3, 2009, the Westbergs filed a complaint 

against the FDIC in the district court for the District of 

Columbia. Count One sought a declaratory judgment that the 

FDIC’s repudiation of the loan agreement released the 

Westbergs from the obligation to repay the loan amount 

already disbursed to them; Count Two sought damages 

resulting from the FDIC’s repudiation, including alleged 

project delay costs. On February 9, 2010, the FDIC assigned 

its rights, title and interest in the Westbergs’ loan to Multibank. 

Multibank maintained the FDIC’s position that the Westbergs 

were obligated to repay the previously disbursed portion of the 

loan. 

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On July 19, 2010, the Westbergs filed an amended 

complaint adding Multibank as a defendant on Count One but 

not Count Two. The district court granted the FDIC’s motion 

to dismiss the Westbergs’ claims against it, Westberg v. FDIC, 

759 F. Supp. 2d 38, 45, 48 (D.D.C. 2011), and the Westbergs 

do not appeal that decision. The district court denied 

Multibank’s motion to dismiss, however, because Multibank 

had submitted only a brief joinder to the FDIC’s motion, 

failing to explain how the FDIC’s arguments applied to the 

Westbergs’ claim against Multibank. Id. at 45–46. After the 

Westbergs and Multibank cross-moved for summary 

judgment, the district court sua sponte raised the issue of 

administrative exhaustion and instructed the parties to file 

supplemental briefs. On February 26, 2013, the district court 

dismissed the Westbergs’ claim against Multibank for lack of 

subject matter jurisdiction, concluding that they were required 

to exhaust their administrative remedies but had not done so. 

Westberg v. FDIC, 926 F. Supp. 2d 61, 64 (D.D.C. 2013). 

The Westbergs timely appealed. 

II. Analysis 

We review de novo the district court’s dismissal for lack 

of subject matter jurisdiction. Benoit v. U.S. Dep’t of Agric., 

608 F.3d 17, 20 (D.C. Cir. 2010). Our review of the district 

court’s statutory interpretation is also de novo. United States 

v. Moore, 703 F.3d 562, 572–73 (D.C. Cir. 2012). We first 

address whether the Westbergs are required to exhaust their 

claim for declaratory relief and then turn to whether they have 

done so. 

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A. Is Exhaustion Required? 

As already noted, 12 U.S.C. § 1821(d)(13)(D) is a broadly 

worded limitation on judicial review of causes of action that 

have not first been pursued in the administrative review 

process. See Am. Nat’l Ins. Co., 642 F.3d at 1141; Auction 

Co. of Am., 141 F.3d at 1200; Freeman, 56 F.3d at 1400. It 

has two subsections. Subsection (i) covers “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 [FDIC] has been appointed receiver, including 

assets which the [FDIC] may acquire from itself as such 

receiver.” 12 U.S.C. § 1821(d)(13)(D)(i). Subsection (ii) 

covers “any claim relating to any act or omission of such 

institution or the [FDIC] as receiver.” Id.

§ 1821(d)(13)(D)(ii). The parties vie over which subsection 

governs our analysis. Although the district court analyzed the 

issue under subsection (i), see Westberg, 926 F. Supp. 2d at 66 

& n.3, we think subsection (ii) governs here. Because 

Multibank now owns all rights to repayment from the 

Westbergs under the Loan Documents, the Westbergs’ request 

for declaratory relief against Multibank is no longer an “action 

seeking a determination of rights with respect to[] the assets of 

any depository institution for which the [FDIC] has been 

appointed receiver.” 12 U.S.C. § 1821(d)(13)(D)(i) 

(emphasis added). It is instead an action seeking a 

determination of rights with respect to the assets of a 

third-party that purchased those assets from the FDIC. The 

Westbergs’ claim does, however, “relat[e] to an[] act or 

omission of . . . the [FDIC] as receiver”—namely, the FDIC’s 

decision to repudiate the loan. Id. § 1821(d)(13)(D)(ii). 

Subsection (i) seems the more relevant provision at first 

blush: It applies to “any claim or action for payment” or “any 

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action seeking a determination of rights” and the latter phrase 

more naturally describes a declaratory judgment action than 

does subsection (ii), which applies to “any claim.” We have 

held, however, that “claim” as used in FIRREA “is a 

term-of-art that encompasses only demands that are resolvable 

through the administrative process set out by FIRREA,” Am. 

Nat’l Ins. Co., 642 F.3d at 1142, and that declaratory relief 

against the FDIC is obtainable through the administrative 

process, see Freeman, 56 F.3d at 1400, 1404; see also Placida 

Prof’l Ctr., LLC v. FDIC, 512 F. App’x 938, 947 n.9 (11th Cir. 

2013); Hudson United Bank v. Chase Manhattan Bank of 

Conn., N.A., 43 F.3d 843, 844, 848–49 (3d Cir. 1994). Thus, 

subsection (ii)’s reference to “any claim” includes a request for 

declaratory relief.1

 The question is whether declaratory relief 

remains obtainable through the administrative process if 

sought against a third-party acquiring bank like Multibank, 

rather than the FDIC. If so, the request would fit within the 

definition of “claim” in subsection (ii) and judicial review 

would be precluded absent administrative exhaustion. See 

Am. Nat’l Ins. Co., 642 F.3d at 1142 (“[D]emands unresolvable 

through the process are not ‘claims,’ as the term is used in the 

Act.”); see also Auction Co. of Am., 141 F.3d at 1200–01 

(section 1821(d)(13)(D) applies to same claims resolvable in 

 1

 The Westbergs argue subsection (ii)’s use of “claim” cannot 

include a claim for declaratory relief because, if that were so, 

subsection (i)’s separation of “claim or action for payment” and 

“action seeking a determination of rights” would give two different 

scopes to “claim.” To wit: the first in subsection (i) would not 

encompass declaratory relief and the second in subsection (ii) would. 

Subsection (i) refers specifically to “any claim or action for 

payment.” Subsection (ii)’s use of “claim,” however, refers broadly 

to “any claim relating to any act or omission” of the failed institution 

or the FDIC. 

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administrative process); Homeland Stores, Inc. v. Resolution 

Trust Corp., 17 F.3d 1269, 1274 (10th Cir. 1994) (same). 

The applicability of the administrative exhaustion 

requirement in subsection (ii) is based not on the entity named 

as defendant but on the actor responsible for the alleged 

wrongdoing: “Where a claim is functionally, albeit not 

formally, against a depository institution for which the FDIC is 

receiver, it is a ‘claim’ within the meaning of FIRREA’s 

administrative claims process.” Am. Nat’l Ins. Co., 642 F.3d 

at 1144; accord Acosta-Ramirez v. Banco Popular de P.R., 712 

F.3d 14, 20–21 (1st Cir. 2013); Farnik v. FDIC, 707 F.3d 717, 

722–23 (7th Cir. 2013); Tellado v. IndyMac Mortg. Servs., 707 

F.3d 275, 280–81 (3d Cir. 2013); Benson v. JPMorgan Chase 

Bank, N.A., 673 F.3d 1207, 1214–15 (9th Cir. 2012); Vill. of 

Oakwood v. State Bank & Trust Co., 539 F.3d 373, 386 (6th 

Cir. 2008). The functional approach ensures “that plaintiffs 

cannot circumvent FIRREA’s jurisdictional bar by drafting 

their complaint strategically,” Am. Nat’l Ins. Co., 642 F.3d at 

1144; see also Farnik, 707 F.3d at 723 (“[S]trategic case 

captioning would allow creditors to completely bypass 

FIRREA’s administrative process . . . .”), and thus undermine 

the Congress’s goal of enabling the FDIC to expeditiously 

wind up the affairs of failed financial institutions, see 

Freeman, 56 F.3d at 1398; see also Vill. of Oakwood, 539 F.3d 

at 386 (contrary approach would “encourage the very litigation 

that FIRREA aimed to avoid” (quotation marks omitted)). 

A few cases illustrate how the functional approach has 

been applied. During the recent financial crisis, Washington 

Mutual Bank was seized by a federal agency, the Office of 

Thrift Supervision, and placed into receivership with the 

FDIC. In American National Insurance Co. v. FDIC, 

Washington Mutual bondholders brought state tort claims 

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against JPMorgan Chase & Co. (JPMC), alleging that it had 

pressured the FDIC to sell Washington Mutual’s most valuable 

assets to JPMC at a drastically undervalued price. 642 F.3d 

1137, 1138–40 (D.C. Cir. 2011). We held that “[b]ecause 

appellants’ suit is against a third-party bank for its own 

wrongdoing, not against the depository institution for which 

the FDIC is receiver (i.e., Washington Mutual), their suit is not 

a claim within the meaning of the Act and thus is not barred by 

subsection (ii).” Id. at 1142. Notwithstanding the FDIC’s 

actions may have “form[ed] one link in the causal chain 

connecting JPMC’s wrongdoing with appellants’ injuries,” we 

concluded that the bondholders’ suit was functionally against 

JPMC for its wrongdoing. Id. at 1144. Accordingly, the 

bondholders were not required to exhaust their claims. Id. at 

1144–45. 

On the other hand, in Village of Oakwood v. State Bank & 

Trust Co., uninsured depositors of a failed bank sued another 

bank (“assuming bank”) that had purchased the failed bank’s 

assets from the FDIC-as-receiver. 539 F.3d 373, 375–76 (6th 

Cir. 2008). The suit alleged that the FDIC had breached its 

fiduciary duty to depositors, but the assuming bank, not the 

FDIC, was the named defendant. Id. Although the plaintiffs 

alleged that the assuming bank had aided and abetted the 

FDIC’s breach, the Sixth Circuit held that plaintiffs’ claim was 

functionally against the FDIC because the FDIC was the 

primary wrongdoer. Id. at 386 (“[A]ll of [plaintiffs’] claims 

against [the assuming bank] are directly related to acts or 

omissions of the FDIC as the receiver of [the failed bank].”). 

Exhaustion was therefore required. Id. at 388. In American 

National Insurance Co., we found the two cases factually 

distinguishable because “in Village of Oakwood the 

wrongdoing alleged was perpetrated by the FDIC-as-receiver, 

which the assuming bank allegedly aided and abetted,” 

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whereas in American National Insurance Co., the alleged 

wrongdoing was perpetrated by JPMC. Am. Nat’l Ins. Co., 

642 F.3d at 1144. 

Similarly, in Tellado v. IndyMac Mortgage Services, the 

plaintiffs had obtained a mortgage loan from IndyMac Bank, 

FSB (IndyMac) before IndyMac’s failure. 707 F.3d 275, 

277–78 (3d Cir. 2013). After IndyMac entered into FDIC 

receivership and the FDIC sold the loan to OneWest Bank, 

FSB (OneWest), the plaintiffs sued OneWest seeking to cancel 

the loan. Id. Their claim, however, was based on IndyMac’s

alleged failure to provide adequate notice (under state law) of 

their right to cancel the loan and ultimately the Third Circuit 

held that the claim was functionally against IndyMac. Id. at 

280. Notably, although OneWest had refused the plaintiffs’ 

pre-suit request to cancel the loan, the court rejected the 

argument that its refusal made the claim functionally against 

OneWest, finding instead that their claim was “wholly 

dependent upon IndyMac’s wrongdoing”—i.e., IndyMac’s 

failure to provide adequate notice. Id. Exhaustion was thus 

required. Id. at 281.2

 2 See also Acosta-Ramirez, 712 F.3d at 15, 21 (exhaustion 

required where former employees of failed bank sued assuming bank 

for severance pay but claim was functionally against 

FDIC-as-receiver for its decisions to terminate employees and to not 

transfer liability for severance pay to assuming bank); Farnik, 707 

F.3d at 719–20, 723–24 (exhaustion required where plaintiffs who 

borrowed from failed bank sued assuming bank but their claims were 

based on failed bank’s alleged deceptive practices and complaint did 

not identify any independent wrongdoing by assuming bank); 

Benson, 673 F.3d at 1208–09, 1215 (exhaustion required where 

investors in Ponzi scheme, which scheme failed bank allegedly aided 

and abetted, brought suit against assuming bank but their claims 

were “based almost exclusively on alleged malfeasance by” failed 

bank). 

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This case is more like Village of Oakwood and Tellado

than it is like American National Insurance Co. The 

Westbergs’ complaint seeks “a declaration that the FDIC’s

repudiation of the [loan agreement] released and discharged 

Plaintiffs from any and all obligations under the [Loan 

Documents].” First Amended Complaint (FAC), Westberg v. 

FDIC, No. 09-cv-1690 ¶ 28 (D.D.C. July 19, 2010) (reprinted 

at JA 24) (emphasis added). The claim is based on the 

FDIC-as-receiver’s act of repudiating the loan because, 

without that act, the Westbergs would not have sought a 

declaration freeing them from having to repay the already 

disbursed portion of the loan. Functionally, the claim 

“relat[es] to an[] act . . . of . . . the [FDIC] as receiver.” 12 

U.S.C. § 1821(d)(13)(D)(ii). 

The Westbergs argue that their claim relates not to the 

FDIC’s repudiation of the loan agreement but rather to 

“Multibank’s discretionary call about how to interpret and 

respond to [the repudiation] after acquiring the loan.” Brief of 

Appellants 24, Westberg v. FDIC, No. 13-5080 (D.C. Cir. July 

15, 2013). Their contention is belied by their pleadings, 

which make no mention of a discretionary call by Multibank 

but simply state: “Because Multibank has no greater rights 

than the FDIC from which it acquired the Loan, Plaintiffs are 

entitled to the same declaration as to Multibank.” FAC ¶ 28 

(reprinted at JA 25) (capitalization altered). Moreover, the 

argument is similar to the plaintiffs’ unavailing contention in 

Tellado that the assuming bank’s failure to cancel the loan 

based on the acts of its predecessor-in-interest constituted an 

independent act that changed the functional analysis. See 

Tellado, 707 F.3d at 280. It might be a different story if the 

FDIC had not repudiated the loan and Multibank had instead 

purchased the loan from the FDIC intact and then itself 

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repudiated or breached the agreement. In that case, the 

Westbergs’ claim would be functionally against Multibank. 

Here, however, the Westbergs’ claim for declaratory relief is 

inextricably related to the FDIC’s act of repudiation. 

Although it is formally brought against Multibank, it is 

functionally against the FDIC. It is therefore a “claim” under 

subsection (ii) that must first be resolved in the administrative 

claims process. See Am. Nat’l Ins. Co., 642 F.3d at 1142.3

 3

 As the Westbergs point out, we have construed the claims 

process broadly only where either the failed depository institution or 

the FDIC “might be held legally responsible to pay or otherwise 

resolve the asserted claim” because, if neither bears any legal 

responsibility, “the claims process offers only a pointless 

bureaucratic exercise” and “we doubt Congress intended to force 

claimants into a process incapable of resolving their claims.” Am. 

Nat’l Ins. Co., 642 F.3d at 1143. But whether the Westbergs 

correctly contend that the FDIC’s declaration would not bind 

Multibank, see Brief of Appellants 21–22, Westberg v. FDIC, No. 

13-5080 (D.C. Cir. July 15, 2013)—an issue we do not reach—the 

administrative claims process is not a pointless bureaucratic exercise 

here. At the time the Westbergs brought their administrative claim, 

the FDIC still held its interest in the loan. The FDIC did not assign 

that interest to Multibank until February 2010—eight months after 

the Westbergs filed their administrative claim, seven months after 

the FDIC resolved that claim and five months after the Westbergs 

filed suit in the district court. Had the Westbergs timely sought 

declaratory relief through the administrative process, the FDIC 

would have resolved that request well before it assigned the loan to 

Multibank. To allow the Westbergs to circumvent FIRREA’s 

exhaustion requirement by declining to pursue the remedies 

available to them and later arguing that such remedies are ineffective 

because of their own delay would amount to permitting the strategic 

pleading we have rejected. See Am. Nat’l Ins. Co., 642 F.3d at 

1144; see also Benson, 673 F.3d at 1213 (“Although plaintiffs assert 

that their claims are not currently susceptible to the claims process, 

plaintiffs give us no reason to believe that FIRREA exhaustion 

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B. Have the Westbergs Exhausted? 

Having concluded that administrative exhaustion is 

required, we have little difficulty concluding that the 

Westbergs have failed to meet the requirement. Although 

they filed a timely proof of claim with the FDIC, their claim 

requested only damages for construction delays. See JA 59–

65. Their claim made no mention of the declaratory relief the 

Westbergs now seek nor could anything in the claim fairly be 

construed to put the FDIC on notice that the Westbergs 

challenged its conclusion that repudiation of the loan 

agreement did not erase the Westbergs’ duty to repay the 

previously disbursed amount. Because the Westbergs failed 

to route their claim for declaratory relief through the 

administrative review process, section 1821(d)(13)(D)(ii) 

withholds judicial review of that claim. See Auction Co. of 

Am., 141 F.3d at 1200; Freeman, 56 F.3d at 1400. Their 

reliance on Sims v. Apfel, 530 U.S. 103 (2000), is misplaced. 

That case deals with the failure to raise specific issues in an 

administrative appeal, see id. at 105–06, whereas the 

Westbergs failed to press an entirely separate claim. See 

McGlothlin v. Resolution Trust Corp., 913 F. Supp. 15, 18–19 

(D.D.C. 1996) (under section 1821(d)(13)(D), plaintiffs’ 

claims based on negligence and breach of contract not 

exhausted where not submitted to administrative process, 

despite fact that separate claim for fraudulent inducement was 

submitted), aff’d, 111 F.3d 963 (D.C. Cir. 1997) (per curiam) 

(mem.); see also BHC Interim Funding II, L.P. v. FDIC, 851 F. 

Supp. 2d 131, 138–39 (D.D.C. 2012) (similar, collecting 

cases). 

 

would have been futile had they submitted them within the 

appropriate time frame.”). 

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Because the Westbergs failed to administratively exhaust 

their claim for declaratory relief, the district court correctly 

dismissed their action for lack of subject matter jurisdiction 

and we affirm.4

 So ordered.

 4

 We reject the Westbergs’ argument that dismissal of their 

claim for failure to exhaust violates due process. We agree that the 

FDIC’s proof-of-claim form—which has subsequently been 

amended, see Appellees’ Rule 28(j) Letter, Westberg v. FDIC, No. 

13-5080 (D.C. Cir. Nov. 25, 2013)—was, in one provision, 

incorrect. See JA 60 (“If the institution does not currently owe you 

any money, it is not necessary for you to complete this form.”). But 

due process requires only that the Westbergs be “afforded notice of 

their exclusive opportunity to present their claims,” which notice 

must be “‘reasonably calculated . . . to apprise interested parties of 

the pendency of the action and afford them an opportunity to present 

their objections.’” Freeman, 56 F.3d at 1403 n.2 (quoting Mullane 

v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950)). 

The FDIC gave the Westbergs adequate notice when it informed 

them of its repudiation of the loan, specified that it expected the 

Westbergs to repay the previously disbursed amount and stated: 

“You may determine that the [FDIC’s] decision to disaffirm the 

Loan Agreement gives you a claim against the receivership estate. 

If so, you must file a Proof of Claim in writing . . . . Under federal 

law, . . . failure to file claims by the Claims Bar Date will result 

in disallowance by the [FDIC], the disallowance will be final, 

and further rights or remedies with regard to claims will be 

barred.” JA 58 (emphases in original). 

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