Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_09-cv-03891/USCOURTS-cand-4_09-cv-03891-0/pdf.json

Parties Involved:
Ramona Esparza
Plaintiff
Federal Deposit Insurance Corporation
Defendant
IndyMac Bank, F.S.B.
Defendant

Document Text:

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Esparza, et al. v. IndyMac Bank, F.S.B., et al. Case No. 3:09-cv-03891-SBA 

[Proposed] Order Granting FDIC’s Motion to Substitute in as Receiver for IndyMac, Bank, F.S.B. 

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UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

RAMONA ESPARZA, 

 Plaintiffs, 

 vs. 

INDYMAC BANK, F.S.B., A 

FEDERALLY CHARTERED SAVINGS 

BANK, and DOES 1 through10, Inclusive, 

 Defendants. 

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Case No. 4:09-cv-03891-SBA 

ORDER GRANTING FEDERAL 

DEPOSIT INSURANCE 

CORPORATION’S REQUEST TO 

SUBSTITUTE IN AS RECEIVER FOR 

INDYMAC BANK, F.S.B. 

Date: 07/27/2010 

Time: 1:00 p.m. 

Location: Courtroom 1, 4th Floor 

Complaint Filed: 08/24/09 

Trial Date: None 

This matter is before the Court on the Federal Deposit Insurance Corporation’s (as 

receiver for IndyMac Bank, F.S.B.) (hereinafter “FDIC”) motion for an order substituting the 

FDIC for defendant IndyMac Bank, F.S.B. (“IndyMac”) pursuant to Fed. R. Civ. P. Rule 25(c). 

Plaintiff Ramona Esparza (“plaintiff”) did not file an opposition to the FDIC’s motion. Having 

read and considered the papers filed in connection with this matter and being fully informed, the 

Court hereby GRANTS the FDIC’s Motion to Substitute. The Court, in its discretion, finds this 

matter suitable for resolution without oral argument. See Fed. R. Civ. P. 78(b). 

I. BACKGROUND 

A. Plaintiff’s Complaint. 

On August 24, 2009, plaintiff filed a Complaint against defendants IndyMac and DOES 1 

through 10, asserting causes of action pursuant to California Civil Code Sections 2923.6, 

1788.17, and 1572 based upon the “unlawful unfair collection practices arising out of the 

financing of their [sic] personal residence” located at 4898 Snowy Egret Way, Oakley, California 

94561 (the “property”). See (Docket Entry No. 1, plaintiff’s Complaint at ¶¶ 1, 15 and 63-92). 

Case 4:09-cv-03891-SBA Document 22 Filed 07/26/10 Page 1 of 6
__________________________________________________________________________________________________________________ 

Esparza, et al. v. IndyMac Bank, F.S.B., et al. Case No. 3:09-cv-03891-SBA 

[Proposed] Order Granting FDIC’s Motion to Substitute in as Receiver for IndyMac, Bank, F.S.B. 

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In addition, plaintiff seeks injunctive and declaratory relief and cancellation of a deed of trust 

previously executed by plaintiff. See id. at ¶¶ 94-108. Plaintiff has asserted diversity 

jurisdiction pursuant to 28 U.S.C. § 1332 and alleges “damages in excess of more than 

$78,000.00.” See id. at ¶¶ 11-14. Plaintiff seeks unspecified damages against defendants, 

declaratory and injunctive relief, and cancellation of a deed of trust, punitive damages, costs and 

attorney’s fees. See id. at pages 15-16, ¶¶ 1-8. 

B. Appointment Of The FDIC As Receiver for IndyMac. 

On July 11, 2008, the Office of Thrift Supervision (“OTS”) closed IndyMac and 

appointed the FDIC as the failed bank’s Receiver pursuant to 12 U.S.C. § 1821(c)(2)(A) of the 

Financial Institutions Reform, Recovery and Enforcement Act of 1989, Pub. L. No. 101-73, 103 

Stat. 183 (1989) (“FIRREA”). On the same day, the OTS authorized the creation of a new 

institution, IndyMac Federal Bank, F.S.B. (“IndyMac Federal”), and appointed the FDIC as 

Conservator (“FDIC-Conservator”) for IndyMac Federal. Following this appointment, the 

majority of IndyMac’s assets and deposit liabilities were transferred to the FDIC-Conservator. 

On March 19, 2009, the OTS closed IndyMac Federal and appointed the FDIC as receiver for 

IndyMac Federal. 

II. DISCUSSION 

A. The FDIC As Receiver Is The True Party In Interest for Defendant IndyMac. 

Title 12 of the United States Code, Section 1821(d)(2)(A)(i) provides that the FDIC, as 

conservator or receiver of an insured depository institution like IndyMac or IndyMac Federal, 

“shall . . . and by operation of law, succeed to all rights, titles, powers, and privileges of the 

insured depository institution . . . with respect to the institution and the assets of the institution . . 

. .” See 12 U.S.C. § 1821(d)(2)(A)(i). An “insured depository institution” is any bank or savings 

association whose deposits are insured by the FDIC. See 12 U.S.C. § 1813(c)(2). When the 

FDIC is appointed as a conservator or receiver of a failed institution, it succeeds to all of the 

rights, title, and interests to the books, records, and assets of the failed institution” and may “take 

over the assets of and operate” the failed institution with all the powers thereof. See 12 U.S.C. 

§§ 1821(d)(2)(A)(ii) and 1821(d)(2)(B)(i); see also In re Community Bank of Northern Virginia, 

Case 4:09-cv-03891-SBA Document 22 Filed 07/26/10 Page 2 of 6
__________________________________________________________________________________________________________________ 

Esparza, et al. v. IndyMac Bank, F.S.B., et al. Case No. 3:09-cv-03891-SBA 

[Proposed] Order Granting FDIC’s Motion to Substitute in as Receiver for IndyMac, Bank, F.S.B. 

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418 F.3d 277, 293 n.6 (3rd Cir. 2005) (noting that “FDC succeeded to all ‘rights, titles, powers, 

and privileges of . . . insured depository institution’” and was ordered substituted “as the true 

party in interest”);

Here, the Court finds that when the OTS appointed the FDIC as receiver for IndyMac on 

July 11, 2008, the FDIC succeeded to all rights, title, interests, and powers and privileges of 

IndyMac, and therefore was entitled to “take over the assets of and operate” IndyMac with all the 

powers thereof. See 12 U.S.C. § 1821(d)(2)(A)(i) and (ii). Thus, the appointment placed the 

FDIC in the shoes of IndyMac in performing all functions previously attributable to the 

institution, including defending against plaintiffs’ action. See id.; see also Tosco Corp. v. 

Federal Deposit Ins. Corp., 723 F.2d 1242, 1247 (6th Cir. 1983) (finding that upon substitution, 

FDIC as receiver for failed Bank “stands in the shoes” of the Bank); Amerifirst Properties, Inc. 

v. FDIC, 880 F.2d 821, 823 n.2 (5th Cir. 1989) (following appointment of FDIC as receiver for 

insolvent bank, FDIC substituted in action for bank “as the real party in interest”). 

B. Substitution Is Appropriate Pursuant To Fed. R. Civ. P. 25(c). 

Rule 25(c) allows a court to substitute a party upon a transfer of interest. Specifically, 

Rule 25(c) provides: “[i]f an interest is transferred, the action may be continued by or against the 

original party unless the court, on motion, orders the transferee to be substituted in the action or 

joined with the original party.” See Fed. R. Civ. P. 25(c); Educational Credit Management 

Corp. v. Bernal (In re Bernal), 207 F.3d 595, 598 (9th Cir. 2000) (stating that Rule 25(c) allows 

an action to continue unabated when an interest in the lawsuit changes hands). The decision to 

grant or deny substitution under Rule 25(c) rests with the sound discretion of the court. See id. 

Here, the Court finds that a transfer of interest within the meaning of Rule 25(c) occurred 

when the OTS declared IndyMac insolvent and appointed the FDIC as receiver for the failed 

bank. As a receiver, the FDIC succeeded to “all rights, titles, powers, and privileges” of 

IndyMac pursuant to 12 U.S.C. § 1821(d)(2)(A). See Sharpe v. FDIC, 126 F.3d 1147, 1152 (9th

Cir. 1997) (stating that “as receiver, the FDIC ‘steps into the shoes’ of the failed financial 

institution”). The Court notes that other courts have granted a receiver’s request for substitution 

pursuant to Rule 25(c) under similar circumstances. See, e.g., FDIC v. Wrapwell Corp., 922 

Case 4:09-cv-03891-SBA Document 22 Filed 07/26/10 Page 3 of 6
__________________________________________________________________________________________________________________ 

Esparza, et al. v. IndyMac Bank, F.S.B., et al. Case No. 3:09-cv-03891-SBA 

[Proposed] Order Granting FDIC’s Motion to Substitute in as Receiver for IndyMac, Bank, F.S.B. 

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F.Supp. 913, 917 (S.D.N.Y. 1996) (concluding that Rule 25(c) allowed FDIC as receiver to 

substitute for plaintiff in underlying case); First American Sav. Bank, F.S.B. v. Westside Federal 

Sav. & Loan Ass’n, 639 F.Supp. 93, 96 (W.D. Wash. 1986) (concluding that receiver’s 

substitution for failed financial institution was proper under Rule 25(c)); see also In re 

Community Bank of Northern Virginia, 418 F.3d 277, 293 n.6 (3rd Cir. 2005) (concluding that 

FDIC was properly substituted “as the true party in interest”); Amerifirst Properties, Inc. v. 

FDIC, 880 F.2d 821, 823 n.2 (5th Cir. 1989) (concluding that trial court properly granted FDIC’s 

motion to substitute as party in interest following its appointment as receiver for insolvent bank). 

Accordingly, the Court finds that the FDIC as receiver for IndyMac is the true party in interest 

and should be substituted for IndyMac as a party in the instant action. 

III. CONCLUSION

For the foregoing reasons, the Court GRANTS the FDIC’s Motion to Substitute in the 

instant action as receiver for IndyMac. 1 The Court further orders that the future caption of all 

subsequent papers filed in this matter shall reflect the substitution as follows: “FEDERAL 

DEPOSIT INSURANCE CORPORATION as Receiver for INDYMAC BANK, F.S.B.” This 

Order terminates Docket No. 14. 

 IT IS SO ORDERED. 

 

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 FDIC has also filed a Request for Judicial Notice of the July 11, 2008 OTS Order appointing 

the FDIC as receiver of IndyMac and of the OTS Order dated March 19, 2009 appointing the 

FDIC as Receiver for IndyMac. (Docket No. 15.) A court may take judicial notice of facts 

not subject to reasonable dispute and either “generally known” in the court's territorial 

jurisdiction, or “capable of accurate and ready determination” by reference to sources whose 

accuracy cannot be reasonably questioned. Fed. R. Evid. 201. The facts described in the 

documents are capable of accurate and ready determination by a source whose accuracy 

cannot be questioned. See Salazar v. Trustee Corps, 2009 WL 690185, at 2 n.2 (S.D. Cal. 

March 12, 2009) (taking judicial notice of an OTS Order appointing the FDIC as Receiver). 

Additionally, a court can take judicial notice of matters of public records. Lee v. City of Los 

Angeles, 250 F.3d 668, 689 (9th Cir. 1982); see also Disabled Rights Action Comm. v. Las 

Vegas Events, Inc., 375 F.3d 861, 866 n.1 (9th Cir.2 004) (taking judicial notice of 

agreements to which the government was a party). Orders entered by the OTS are public 

records and thus proper for judicial notice. See Ibarra v. Loan City, 2010 WL 415284, at 3 

(S.D. Cal. January 27, 2010) (taking judicial notice of an OTS Order). Therefore, FDIC’s 

Request for Judicial Notice is GRANTED. 

Case 4:09-cv-03891-SBA Document 22 Filed 07/26/10 Page 4 of 6
__________________________________________________________________________________________________________________ 

Esparza, et al. v. IndyMac Bank, F.S.B., et al. Case No. 3:09-cv-03891-SBA 

[Proposed] Order Granting FDIC’s Motion to Substitute in as Receiver for IndyMac, Bank, F.S.B. 

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Dated: 7/23/10 

 Honorable Saundra Brown Armstrong 

 UNITED STATES DISTRICT COURT JUDGE 

Case 4:09-cv-03891-SBA Document 22 Filed 07/26/10 Page 5 of 6
__________________________________________________________________________________________________________________ 

Esparza, et al. v. IndyMac Bank, F.S.B., et al. Case No. 3:09-cv-03891-SBA 

[Proposed] Order Granting FDIC’s Motion to Substitute in as Receiver for IndyMac, Bank, F.S.B. 

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UNITED STATES DISTRICT COURT 

FOR THE 

NORTHERN DISTRICT OF CALIFORNIA 

ESPARZA et al, 

 Plaintiff, 

 v. 

INDYMAC BANK, F.S.B. et al, 

 Defendant. 

 / 

Case Number: CV09-03891 SBA 

CERTIFICATE OF SERVICE 

I, the undersigned, hereby certify that I am an employee in the Office of the Clerk, U.S. District 

Court, Northern District of California. 

That on July 26, 2010, I SERVED a true and correct copy(ies) of the attached, by placing said 

copy(ies) in a postage paid envelope addressed to the person(s) hereinafter listed, by depositing 

said envelope in the U.S. Mail, or by placing said copy(ies) into an inter-office delivery 

receptacle located in the Clerk's office. 

Ramona Esparza 

4898 Snowy Egret Way 

Oakley, CA 94561 

Dated: July 26, 2010 Richard W. Wieking, Clerk 

 By: LISA R CLARK, Deputy Clerk 

Case 4:09-cv-03891-SBA Document 22 Filed 07/26/10 Page 6 of 6