2010 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

12-17-2010

Louis A. DeNaples v. Office of the Comptroller of t

Precedential or Non-Precedential: Non-Precedential

Docket No. 10-1568

Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2010

This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova

University School of Law Digital Repository. It has been accepted for inclusion in 2010 Decisions by an authorized administrator of Villanova

University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.

Recommended Citation

"Louis A. DeNaples v. Office of the Comptroller of t" (2010). 2010 Decisions. Paper 60.

http://digitalcommons.law.villanova.edu/thirdcircuit_2010/60
NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

____________

No. 10-1568

____________

LOUIS A. DENAPLES, 

 Appellant

v.

OFFICE OF THE COMPTROLLER OF THE CURRENCY

____________

On Appeal from the United States District Court

for the Middle District of Pennsylvania

(D.C. No. 09-cv-01802)

District Judge: Honorable Thomas I. Vanaskie

____________

Submitted Under Third Circuit LAR 34.1(a)

December 16, 2010

Before: JORDAN, HARDIMAN and VAN ANTWERPEN, Circuit Judges.

(Filed: December 17, 2010)

____________

OPINION OF THE COURT

____________

HARDIMAN, Circuit Judge.

Louis A. DeNaples appeals a District Court order dismissing his claim for lack of 

subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1). We will 

affirm.
2

I

Because we write for the parties, we recount only those facts necessary to our 

decision. DeNaples is a member of the Board of Directors of First National Community 

Bank (FNCB), which operates in various locations in northeastern Pennsylvania. 

DeNaples joined the Board in 1972 and has been its Chairman since 1988. FNCB is a 

federally chartered bank and, as such, is subject to regulation by the Office of the 

Comptroller of Currency (OCC) pursuant to the National Bank Act of 1864. See 12 

U.S.C. § 1 et seq.

In January 2008, the District Attorney for Dauphin County, Pennsylvania brought 

criminal perjury charges against DeNaples, following his testimony before the 

Pennsylvania Gaming Control Board regarding a gaming license for Mount Airy Casino. 

Shortly after he was charged, DeNaples took a leave of absence from FNCB. Thereafter, 

the OCC issued a Notice of Suspension pursuant to 12 U.S.C. § 1818(g)(1), which 

formally prohibited DeNaples from being involved with FNCB or any other FDICinsured bank.

While he and the District Attorney negotiated a resolution to the perjury charges, 

DeNaples maintained that he would not accept a “pretrial diversion,” because such an 

agreement would require him to resign from the Board of FNCB. See 12 U.S.C. § 1829 

(stating that any person who enters into a “pretrial diversion or similar program” in 

connection with a crime involving dishonesty is prohibited from, inter alia, holding a 
3

position as a director of an FDIC insured depository institutions without prior approval 

from the FDIC). In April 2009, DeNaples and the District Attorney signed a Withdrawal 

Agreement, in which the District Attorney agreed to withdraw the perjury charges in 

exchange for various concessions from DeNaples.

Two days after DeNaples executed the Withdrawal Agreement, he received a letter 

from the OCC stating that the agency “ha[d] become aware of [DeNaples‟s] pretrial 

diversion agreement.” App. 72. Because the agreement was “based on a crime that 

involves dishonesty or a breach of trust,” DeNaples was “subject to the prohibitions set 

forth in 12 U.S.C. §[] 1829.” Id. The letter also informed DeNaples that he “would be 

subject” to “fines not exceeding $1,000,000 . . . [per] day . . . and/or a term of 

imprisonment of not more than five years” for a knowing violation of § 1829. Id. The 

OCC posted its determination on its website as a § 1829 enforcement action.1

In June 2009, DeNaples‟s counsel wrote a letter to the OCC challenging the 

agency‟s determination that the Withdrawal Agreement constituted a “pretrial diversion 

or similar agreement.” This letter included an opinion from a Pennsylvania criminal 

defense lawyer stating that the Withdrawal Agreement “was not, in any manner 

whatsoever, . . . [a] pretrial diversion under State Law.” Id. at 76. The OCC responded to 

DeNaples‟s challenge with a second letter reaffirming its conclusion that the Withdrawal 

 

1

Section 1829 is a criminal statute enforceable by the Department of Justice. The 

OCC is, however, authorized by § 1818 to remove an individual it finds to be in violation 
4

Agreement constituted a “pretrial diversion or similar program” under § 1829. The letter 

concluded that “pursuant to 12 U.S.C. § 1829 . . . [DeNaples] is permanently prohibited 

from continuing service at the Bank or any other federally insured depository institution.” 

Id. at 83. The letter instructed DeNaples to “take immediate steps to inform the Board of 

Directors that he may no longer serve in any capacity as [a director] of the Bank, and 

indicate that his absence is permanent, rather than temporary in nature.” Id.

After receiving the OCC‟s second letter, DeNaples filed a complaint in the District 

Court requesting, inter alia, a declaration that the Withdrawal Agreement did not 

constitute a “pretrial diversion or similar program.” DeNaples argued that the letters 

issued by the OCC constituted final agency action and, as such, were subject to review 

under the Administrative Procedure Act (APA). See 5 U.S.C. § 704 (“[F]inal agency 

action for which there is no other adequate remedy in a court [is] subject to judicial 

review.”). But see 5 U.S.C. § 701(a) (stating that APA review is unavailable to the extent 

that “statutes preclude judicial review”).

More than two months after DeNaples filed his complaint, the OCC commenced a 

separate cease-and-desist proceeding against him pursuant to 12 U.S.C. § 1818(b). The 

agency‟s objective in initiating the proceeding was to remove DeNaples from his position 

as Chairman of the Board of FNCB for his violation of § 1829. One day after 

commencing the § 1818(b) proceeding, the OCC filed a Motion to Dismiss DeNaples‟s 

 

of § 1829. In this case, because the OCC was not acting pursuant to its authority under § 
5

complaint, arguing that any resolution of the merits of DeNaples‟s claim by the District 

Court would impermissibly “affect” the OCC‟s cease-and-desist proceeding in violation 

of the jurisdictional bar in § 1818(i). See 12 U.S.C. § 1818(i)(1) (“[E]xcept as otherwise 

provided in this section or under section 1831o or 1831p-1 of this title no court shall have 

jurisdiction to affect by injunction or otherwise the issuance or enforcement of any notice 

or order under any such section, or to review, modify, suspend, terminate, or set aside any 

such notice or order.”). After oral argument, the District Court granted the OCC‟s 

motion. This appeal followed.2

II

We exercise plenary review over a District Court order dismissing a claim for lack 

of subject matter jurisdiction. See Gould Elecs. Inc. v. United States, 220 F.3d 169, 176 

(3d Cir. 2000) (citing Dresser Indus., Inc. v. Underwriters at Lloyds of London, 106 F.3d 

494, 496 (3d Cir. 1997)).

III

DeNaples argues that the OCC was not authorized to issue the letters purporting to 

remove him under § 1829 and that judicial review of the OCC‟s actions does not 

implicate the jurisdictional bar of § 1818(i).

The District Court correctly rejected DeNaples‟s argument. Although DeNaples 

 

1818, its purported enforcement action was not binding.
6

would have us review the enforcement letters in isolation from the OCC‟s pending 

§1818(b) cease-and-desist proceeding, it would be improper to do so. The OCC‟s 

enforcement letters constituted an agency determination that DeNaples‟s Withdrawal 

Agreement was a “pretrial diversion or similar agreement” under § 1829. This question is 

under formal consideration by the OCC in its ongoing § 1818(b) proceeding. The 

congressional framework enacted in § 1818 is intended to allow agencies to conduct 

formal reviews without interference from the federal courts. See 12 U.S.C. 

§1818(i)(1)(“[E]xcept as otherwise provided in this section . . . no court shall have 

jurisdiction to affect by injunction or otherwise the issuance or enforcement of any notice 

or order under this section.”). The broad language of § 1818(i) has led the Supreme Court

to interpret its jurisdictional bar expansively. See Bd. of Governors of Fed. Reserve Sys. 

v. MCorp Fin., Inc., 502 U.S. 32, 44 (1991) (holding that § 1818(i) provides “clear and 

convincing evidence” of congressional intent to strip jurisdiction). Here, the OCC‟s 

§1818(b) proceeding against DeNaples is authorized by the Federal Deposit Insurance 

Act. If we were to adjudicate the validity of the OCC‟s enforcement letters, our decision 

would impermissibly “affect” the OCC‟s pending § 1818(b) proceeding in violation of 

§1818(i)(1).3

 

2

The District Court exercised jurisdiction pursuant to 28 U.S.C. § 1331, 5 U.S.C. 

§§ 701-706, and 28 U.S.C. §§ 2201-2202. We have appellate jurisdiction under 28 

U.S.C. § 1291.

3 DeNaples argues that judicial review of whether the OCC lacked authority to 

remove him pursuant to § 1829 would not “affect” the agency‟s pending cease-and-desist 
7

DeNaples offers several reasons why the jurisdictional bar of § 1818(i) is 

inapplicable. First, he claims that § 1818(i)(1) is only intended to protect agency 

proceedings that are not yet final. Consequently, he insists that § 1818(i)(1) should not 

apply to his purported removal pursuant to § 1829, which he believes constituted final 

agency action. This argument fails to recognize the OCC‟s consistent position that the 

letters purporting to remove DeNaples pursuant to § 1829 have no binding force. 

Although the District Court concluded that the letters “bear the hallmarks of „final agency 

action,‟” the Court also repeatedly noted that the letters lacked any statutory basis of 

authority. DeNaples v. Office of Comptroller of Currency, No. 3:CV-09-1802, 2010 WL 

457134, at *5 (M.D. Pa. Feb. 4, 2010). DeNaples cannot simultaneously argue both that 

the letters were issued without authority, and therefore are not final, and that judicial 

review of their merits is appropriate under § 1818(i)(1).

DeNaples also argues that § 1818(i) is inapplicable because the OCC did not 

 

proceeding within the meaning of § 1818(i). It is unclear how this affects our analysis, 

however. Throughout this litigation, the OCC has maintained that the enforcement letters 

were not binding upon DeNaples. In response to the District Court‟s query whether there 

was any pending agency action that “would preclude Mr. DeNaples . . . from assuming 

his position on the Board of Directors,” the OCC responded: “if he were to assume his 

position, he would not be in violation of the letters, you can‟t violate the letters. If we 

wanted to remove him, we would have to take some other temporary action or simply 

wait until we resolved it through the 1818(b) proceeding.” App. 34-35. Thus, there is no 

agency action prohibiting DeNaples from returning to FNCB, although he may be subject 

to an enforcement action by the Department of Justice should he choose to return. 

DeNaples‟s attempt to have us insulate him from any liability pending the resolution of 

the OCC‟s cease-and-desist proceeding would be tantamount to a determination, contrary 

to § 1818(i), that he is not in violation of § 1829.
8

commence its cease-and-desist proceeding until after he filed a complaint in the District 

Court. The District Court correctly rejected this argument as well. The jurisdictional bar 

set forth in § 1818(i)(1) is not limited to judicial determinations that would “affect” 

agency proceedings outstanding at the time that the action is commenced. Rather, 

§1818(i)(1) imposes an expansive prohibition, stripping federal courts of jurisdiction 

whenever a determination could affect an agency decision. See Hindes v. Fed. Deposit 

Insur. Corp., 137 F.3d 148, 164 (3d Cir. 1998) (holding that § 1818(i), by its own terms, 

“is not restricted to precluding judicial review which would interfere with an ongoing 

administrative proceeding”); see also Groos Nat’l Bank v. Comptroller of Currency, 573 

F.2d 889, 895 (5th Cir. 1978) (“The bank and Manges requested an injunction as well as a 

declaratory judgment in their favor [prior to the initiation of the administrative 

proceeding]; section 1818(i) in terms removes the court‟s jurisdiction to issue an 

injunction affecting the regulatory agency‟s notice or order, except as provided in section 

1818 proceedings and review.”). Consequently, the fact that the OCC‟s cease-and-desist 

proceeding was commenced after DeNaples filed his complaint does not relieve us from 

the jurisdictional bar of § 1818(i).4

IV

For the foregoing reasons, we will affirm the judgment of the District Court.

 

4 We note that DeNaples will have access to judicial review of the OCC‟s order 

under 12 U.S.C. § 1818(h)(2) after the conclusion of the agency‟s cease-and-desist 

proceeding.