FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

KIMBERLY BENSON; KARIMDAD 

BALOCH; and NEERJA JAIN

GURSAHANEY, individually and on

behalf of all others similarly

situated,

No. 10-17402 Plaintiffs-Appellants,  D.C. No. v.

3:09-cv-05272-MEJ

JPMORGAN CHASE BANK, N.A.,

individually and as successor in

interest of Washington Mutual,

Inc.,

Defendant-Appellee. 

JOHN ALEXANDER LOWELL, 

individually and on behalf of all

others similarly situated,

Plaintiff-Appellant, No. 10-17404

v. D.C. No.  3:09-cv-05560-MEJ JPMORGAN CHASE BANK, N.A.,

individually and as successor in OPINION

interest of Washington Mutual,

Inc.,

Defendant-Appellee. 

3237
Appeal from the United States District Court

For the Northern District of California

Maria-Elena James, Chief Magistrate Judge, Presiding

Argued and Submitted

December 6, 2011—San Francisco, California

Filed March 20, 2012

Before: Carlos F. Lucero,* Consuelo M. Callahan, and

N. Randy Smith, Circuit Judges.

Opinion by Judge Lucero

*The Honorable Carlos F. Lucero, United States Circuit Judge for the

Tenth Circuit, sitting by designation. 

3238 BENSON v. JPMORGAN CHASE BANK
COUNSEL

Niall P. McCarthy, Cotchett, Pitre & McCarthy, LLP, Burlingame, California (Anne Marie Murphy and Aron K. Liang,

Cotchett, Pitre & McCarthy, LLP, Burlingame, California,

and Derek G. Howard and Bethany Caracuzzo, Minami

Tamaki LLP, San Francisco, California, with him on the

briefs), for the plaintiffs-appellants.

Robert A. Sacks (Stacey R. Friedman and M. David Possick

with him on the briefs), Sullivan & Cromwell LLP, Los

Angeles, California, for the defendant-appellee.

OPINION

LUCERO, Circuit Judge:

Plaintiffs, a group of investors defrauded by the “Millennium Ponzi scheme,” seek recourse against JPMorgan Chase

Bank N.A. (“JPMorgan”). They allege that Washington

Mutual, Inc. (“WaMu”) aided and abetted the Ponzi scheme

by providing banking services to several companies controlled by the scheme’s principals despite actual knowledge of

the fraud. JPMorgan, they argue, is liable as successor in

interest of WaMu, having purchased most of WaMu’s assets

and liabilities from the Federal Deposit Insurance Corporation

(“FDIC”). The FDIC had taken WaMu into receivership pursuant to the Financial Institutions Reform, Recovery, and

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

(“FIRREA”). Plaintiffs further claim JPMorgan is liable

because it continued WaMu’s problematic practices following

assumption.

The district court dismissed plaintiffs’ complaints for failure to exhaust FIRREA’s administrative remedies. See 12

U.S.C. § 1821(d)(13)(D)(ii) (barring “any claim relating to

BENSON v. JPMORGAN CHASE BANK 3241
any act or omission of [a failed bank] or the [FDIC] as receiver” unless such claim is first presented to the FDIC). Plaintiffs

contend, however, that FIRREA’s jurisdictional bar is limited

to claims against a failed bank or the FDIC and thus has no

application to claims asserted against a purchasing bank with

assets that passed through FDIC receivership. They further

argue that portions of their claims are based on JPMorgan’s

independent, post-purchase conduct, which is not governed by

FIRREA.

We reject plaintiffs’ first contention. Litigants cannot avoid

FIRREA’s administrative requirements through strategic

pleading. Accordingly, we join three other circuits in concluding that a claim asserted against a purchasing bank based on

the conduct of a failed bank must be exhausted under FIRREA. See Am. Nat’l Ins. Co. v. FDIC, 642 F.3d 1137, 1144

(D.C. Cir. 2011); Village of Oakwood v. State Bank & Trust

Co., 539 F.3d 373, 386 (6th Cir. 2008); Am. First Fed., Inc.

v. Lake Forest Park, Inc., 198 F.3d 1259, 1263 n.3 (11th Cir.

1999).

The same is not true, however, with respect to claims based

on a purchasing bank’s post-purchase actions. Such claims are

not governed by FIRREA. They could not, and accordingly

need not, be exhausted before the FDIC. See Henderson v.

Bank of New England, 986 F.2d 319, 321 (9th Cir. 1993)

(FIRREA applies only to claims that are “susceptible of resolution through the claims procedure”). 

Although we agree with plaintiffs’ legal argument on this

score, we conclude it has no application to the case at bar.

Plaintiffs did not adequately plead a claim based on JPMorgan’s independent conduct; they relied instead solely on conclusory allegations. The district court’s dismissal of plaintiffs’

claims, along with its subsequent denial of plaintiffs’ Federal

Rule of Civil Procedure 60(b) motion, was therefore proper.

Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.

3242 BENSON v. JPMORGAN CHASE BANK
I

A

We draw the following facts from plaintiffs’ complaints.1

In 1999, Canadian attorney William J. Wise initiated the Millennium Ponzi scheme. Wise formed the Millennium Bank

and Trust Company, later renamed the Millennium Bank, in

St. Vincent and the Grenadines. He began selling what he

claimed were high-yield Certificates of Deposit (“CDs”)

issued by subsidiaries of the United Trust of Switzerland S.A.

In fact, the CDs sold by Wise and his associates were fraudulent, the Millennium Bank was not affiliated with any Swiss

banking company, and the company was not licensed to sell

securities. The Millennium Bank originally obtained financial

services from several banks in North Carolina, but those institutions closed Wise’s accounts due to suspicious activity. 

In July 2004, Wise and two of his associates, Jacqueline

and Kristi Hoegel, formed three Nevada business entities with

names similar to United Trust of Switzerland: UT of S, LLC;

United T of S, LLC; and Sterling I.S., LLC (collectively, the

“Nevada LLCs”). The Hoegels used these entities to operate

the banking side of the scheme from Napa, California. They

would regularly deposit large checks in bulk at the Napa

WaMu branch and immediately wire large sums to “known

banking and tax havens.” Most checks that the Hoegels

deposited had handwritten notations that indicated they were

tendered in exchange for CDs. However, based on paperwork

submitted at the time the accounts for the Nevada LLCs were

opened, WaMu was aware that the companies were not

licensed to sell securities in the United States. 

Two WaMu employees provided substantial assistance to

1

“In reviewing [a] Rule 12(b)(1) dismissal, we must accept all factual

allegations in the complaint as true.” Carson Harbor Village, Ltd. v. City

of Carson, 353 F.3d 824, 826 (9th Cir. 2004). 

BENSON v. JPMORGAN CHASE BANK 3243
the Hoegels: branch manager Tamara Miller and commercial

banking officer Bianca Greeves. Greeves recommended in

February 2008 that the Nevada LLCs install a “cash management transfer” (“CMT”) system at the Nevada LLCs’ office.

CMT systems, which allow outgoing wire transfers to be sent

without the direct assistance of bank staff, are usually provided to large institutions with multinational operations.

Before providing the CMT system, WaMu was required to

conduct a detailed audit. Jennifer Blevins, a Business Treasury Services Senior Specialist for WaMu, approved the use

of a CMT system for the Nevada LLCs after investigating the

nature of their business, their financial strength, the number

of their employees, and the amount of money coming in and

out of their accounts each month. In September 2008, Greeves

further recommended that the Nevada LLCs obtain a “remote

deposit capture” (“RDC”) system, which allows companies to

scan and deposit checks without presenting them to a bank.

Installing this system required a second and more detailed

audit, which was again conducted by Blevins. 

On September 22, 2008, the Federal Deposit Insurance

Company (“FDIC”) seized WaMu pursuant to its authority

under FIRREA. Three days later, JPMorgan acquired most of

WaMu’s assets and liabilities under a purchase and assumption agreement with the FDIC. 

The Millennium Ponzi scheme came to an end several

months later. On March 25, 2009, the Securities and

Exchange Commission filed an action against Wise. It alleged

that Wise, the Hoegels, and their associates had raised at least

$68 million by selling fraudulent CDs. A receiver took control

of the Nevada LLCs’ assets and those of the Millennium

Ponzi scheme principals. All suits against those individuals

and entities were enjoined.

B

In November 2009, two similar complaints involving the

Millennium Ponzi scheme were filed against JPMorgan. The

3244 BENSON v. JPMORGAN CHASE BANK
first was filed by Kimberly Benson, Karimdad Baloch, and

Neerja Gursahaney, and the second by John Lowell. The first

set of plaintiffs purchased what they believed were CDs from

the Nevada LLCs between May 2006 and August 2008. Lowell did not state when he purchased fraudulent CDs. Both

complaints asserted claims for aiding and abetting fraud, aiding and abetting conversion, and violating California banking

law. The complaint by Benson, Baloch, and Gursahaney also

asserted claims for aiding and abetting breach of fiduciary

duty, and conspiracy to commit fraud and conversion. Both

complaints sought certification of a class of similarly situated

victims of the Millennium Ponzi scheme. The two cases were

consolidated below.

The district court dismissed the conspiracy claims on

JPMorgan’s Federal Rule of Civil Procedure 12(b)(6) motion,

but denied that motion as to plaintiffs’ remaining claims.

JPMorgan then filed a motion to dismiss under Federal Rule

of Civil Procedure 12(b)(1), arguing that the district court

lacked jurisdiction because plaintiffs had not exhausted

administrative remedies under FIRREA. The district court

granted that motion and ordered the clerk of the court to

“close the file” for the case. No separate judgment was

entered. 

Plaintiffs then filed a Rule 60(b) motion seeking reconsideration of the district court’s order and an opportunity to

amend their complaints. They argued that even if their claims

based on WaMu’s conduct could be dismissed, the complaints

alleged independent misconduct on the part of JPMorgan.

Although the complaints do not detail any specific actions

taken by JPMorgan, an introductory paragraph states that

despite actual knowledge of the Millennium Ponzi scheme,

“[WaMu] continued to provide substantial assistance to

Wise’s illegal enterprise and promoted the continued success

of that enterprise for a period in excess of four years” and that

“[t]hese practices continued after JPMorgan acquired [WaMu]

BENSON v. JPMORGAN CHASE BANK 3245
in September of 2008.” The district court denied reconsideration. 

II

We review de novo a district court’s dismissal under Rule

12(b)(1). Rhoades v. Avon Prods., Inc., 504 F.3d 1151, 1156

(9th Cir. 2007). “For the purposes of reviewing such dismissals, and where, as here, no evidentiary hearing has been held,

all facts alleged in the complaint are presumed to be true.” Id.

(quotation and alterations omitted). 

A district court’s denial of a Rule 60(b) motion is reviewed

for abuse of discretion. Latshaw v. Trainer Wortham & Co.,

452 F.3d 1097, 1100 (9th Cir. 2006). “Whether such a denial

rests on an inaccurate view of the law and is therefore an

abuse of discretion requires us to review the underlying legal

determination de novo.” Smith v. Pac. Props. & Dev. Corp.,

358 F.3d 1097, 1100 (9th Cir. 2004) (citation and italicization

omitted).

III

[1] Following the savings and loan crisis of the 1980s,

Congress passed FIRREA “ ‘to give the FDIC power to take

all actions necessary to resolve the problems posed by a financial institution in default.’ ” Sahni v. Am. Diversified Partners, 83 F.3d 1054, 1058 (9th Cir. 1996) (quoting H.R. Rep.

No. 101-54(I), at 330 (1989), reprinted in 1989 U.S.C.C.A.N.

86, 126). The statute grants the FDIC authority to “act as

receiver or conservator of a failed institution for the protection of depositors and creditors.” Sharpe v. FDIC, 126 F.3d

1147, 1154 (9th Cir. 1997). It provides detailed procedures to

allow the FDIC to consider certain claims against the receivership estate, see 12 U.S.C. § 1821(d)(3)-(10), “to ensure that

the assets of a failed institution are distributed fairly and

promptly among those with valid claims against the institution, and to expeditiously wind up the affairs of failed banks,”

3246 BENSON v. JPMORGAN CHASE BANK
McCarthy v. FDIC, 348 F.3d 1075, 1079 (9th Cir. 2003)

(quotation omitted). 

[2] FIRREA requires that a plaintiff exhaust these administrative remedies with the FDIC before filing certain claims.

Henderson v. Bank of New England, 986 F.2d 319, 321 (9th

Cir. 1993). The statute provides:

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.

§ 1821(d)(13)(D). 

The district court dismissed plaintiffs’ claims under

§ 1821(d)(13)(D)(ii), holding that the claims related to acts or

omissions of WaMu and had not been presented to the FDIC.

Plaintiffs argue the district court erred in construing FIRREA

to preclude their claim against JPMorgan as WaMu’s successor in interest. They argue the jurisdictional bar does not

apply to claims asserted against third-party purchasing banks

such as JPMorgan. In the alternative, plaintiffs contend that

portions of their claims were based on JPMorgan’s own, postpurchase misconduct and were thus not related to the acts or

omissions of WaMu. Finally, they argue that the district court

improperly dismissed their complaint without allowing them

leave to amend.

BENSON v. JPMORGAN CHASE BANK 3247
A

[3] Plaintiffs’ assertion that FIRREA’s jurisdictional bar

does not apply to purchasing institutions is undermined by the

plain text of § 1821(d)(13)(D)(ii). That provision distinguishes claims on their factual bases rather than on the identity of the defendant: It asks whether claims “relate to any act

of omission” of a failed institution or the FDIC. Notably, the

provision does not make any distinction based on the identity

of the party from whom relief is sought. 

In their uphill argument against the statutory text, plaintiffs

rely heavily on Henrichs v. Valley View Development, 474

F.3d 609 (9th Cir. 2007), in which this court stated that FIRREA’s “requirement to exhaust administrative remedies

applies only in an action against the FDIC as receiver.” Id. at

614. In context, however, it is clear that Henrichs discussed

only the first prong of FIRREA’s jurisdictional bar contained

in § 1821(d)(13)(D)(i).

The Henrichs case concerned a collateral attack on a statecourt judgment quieting title in a parcel of land that had

passed through FDIC receivership. A plaintiff argued that

FIRREA vests exclusive federal jurisdiction over any dispute

regarding property once held by the FDIC as a receiver. See

Henrichs, 474 F.3d at 613. The Henrichs plaintiff cited to 12

U.S.C. § 1821(j), which bars any court from “restrain[ing] or

affect[ing] the exercise of powers or functions of the [FDIC]

as a conservator or a receiver,” and to § 1821(d)(13)(D). We

rejected reliance on § 1821(j), holding that a state-court quiet

title action brought by the purchasers of property once held in

receivership did not restrain or affect the FDIC, which had

relinquished any interest in the parcel at the time of suit. Henrichs, 474 F.3d at 614. 

As to § 1821(d)(13)(D), we expressed some confusion as to

the nature of the plaintiff ’s argument. “If, by citing this provision, [the plaintiff] means to imply that the statute bars the

3248 BENSON v. JPMORGAN CHASE BANK
state court’s adjudication of the dispute with [the property

owner], he is mistaken.” Henrichs, 474 F.3d at 614. We concluded that § 1821(d)(13)(D) does not “confer exclusive federal jurisdiction.” Henrichs, 474 F.3d at 614. The court

further stated that “the requirement to exhaust administrative

remedies applies only in an action against the FDIC as receiver.” Id.

Although the court cited § 1821(d)(13)(D) without specifying a subsection, context establishes that the above-quoted

statement concerned only subsection (i), which requires

exhaustion of administrative remedies for “any action seeking

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

depository institution for which the [FDIC] has been

appointed receiver.” The court described only the first prong

of § 1821(d)(13)(D), which “states that individuals seeking to

make claims that affect assets acquired by the FDIC in its

capacity as a conservator or receiver must exhaust the FDIC’s

administrative claims process before seeking judicial review.”

Henrichs, 474 F.3d at 614. The quiet title action at issue in

Henrichs arguably qualified under this prong as one “seeking

the determination of rights” as to an asset formerly held by

the FDIC as receiver for a failed bank. In contrast, nothing in

Henrichs suggests that the quiet title action could have been

related to the acts or omissions of a failed bank or the FDIC

—the subjects of subsection (ii).2

Because Henrichs did not consider subsection (ii), the provision at issue in this case, it does not control our analysis.3

2Plaintiff in Henrichs also advanced a breach of contract claim against

the FDIC, but that claim was dismissed as moot. 474 F.3d at 615. The

court did not discuss FIRREA’s application to the contract claim, and the

court did not note any “act or omission” of the failed bank, see

§ 1821(d)(13)(D)(ii), in relation to the attack on the quiet title judgment.

3The same is true of an out-of-circuit case plaintiffs cite along with

Henrichs. In FDIC v. McFarland, 243 F.3d 876 (5th Cir. 2001), the court

held that the “claim procedures articulated in [FIRREA] are predicated on

BENSON v. JPMORGAN CHASE BANK 3249
We are similarly unpersuaded by plaintiffs’ citation to other

Ninth Circuit authority. Plaintiffs focus on a statement in

McCarthy indicating that FIRREA’s jurisdictional bar applies

to claimants “who challenge conduct by the FDIC as receiver.” 348 F.3d at 1081. But the McCarthy court did not hold

that only such claims are covered. To the contrary, McCarthy

recognized that “FIRREA’s exhaustion requirement applies to

any claim or action respecting the assets of a failed institution

for which the FDIC is receiver.” Id. Furthermore, McCarthy

plainly did not deal with the statutory subsection at issue here:

the jurisdictional bar on claims “relating to any act or omission” of a failed bank. § 1821(d)(13)(D)(ii).

By the same token, Henderson, 986 F.2d 319, does not

excuse exhaustion in this case. We explained in Henderson

that FIRREA “bars judicial review of any non-exhausted

claim, monetary or nonmonetary, which is susceptible of resolution through the claims procedure.” Id. at 321 (quotation

omitted). Although plaintiffs assert that their claims are not

currently susceptible to the claims process, plaintiffs give us

no reason to believe that FIRREA exhaustion would have

been futile had they submitted them within the appropriate

time frame. Further, to the extent plaintiffs assert they currently lack a remedy, that result can only be attributed to their

failure to exhaust. Cf. Bueford v. Resolution Trust Corp., 991

the FDIC’s possession of the property in question. When the FDIC relinquishes ownership, the procedures governing its role as a receiver no longer apply to the property.” Id. at 887 n.42. But McFarland did not

consider whether § 1821(d)(13)(D)(ii) extends to claims against parties

other than a failed bank or the FDIC. The court briefly discussed

§ 1821(d)(13)(D), which was raised for the first time during oral argument, in rejecting a contention that FIRREA barred adjudication of a lien

seniority dispute involving an assignee of the FDIC. McFarland, 243 F.3d

at 887 n.42. As in Henrichs, the McFarland court did not distinguish

between the subsections of FIRREA’s jurisdictional bar, but it is clear the

court was referring to subsection (i). The case concerned assets once held

by the FDIC but did not discuss any allegations of wrongdoing by the

failed bank or the FDIC. Id.

3250 BENSON v. JPMORGAN CHASE BANK
F.2d 481, 486 (8th Cir. 1993) (“Since the language of the statute expressly provides for judicial review after exhaustion of

the administrative procedures, [plaintiff] cannot prevail on her

claim that FIRREA’s administrative procedures deny her due

process by making judicial review unavailable.”).

[4] Thus, this court has not decided the precise issue

pressed by plaintiffs in their first claim of error: whether FIRREA’s jurisdictional bar can apply to claims against parties

other than failed banks or the FDIC. Some of our sibling circuits, however, have addressed the question. 

In Village of Oakwood v. State Bank & Trust Co., 539 F.3d

373 (6th Cir. 2008), the court considered an argument that

FIRREA did not apply because plaintiffs “sued only [the bank

that purchased a failed institution], rather than the FDIC” and

thus the “claims fall completely outside of the framework of

FIRREA’s administrative process.” Id. at 386. The court flatly

rejected this line of reasoning:

The problem with this novel argument is that all of

[plaintiffs’] claims against [the purchasing bank] are

directly related to acts or omissions of the FDIC as

the receiver of [the failed bank]. As the district court

explained, accepting the [plaintiffs’] argument and

permitting claimants to avoid the provisions of (d)(6)

and (d)(13) by bringing claims against the assuming

bank would encourage the very litigation that FIRREA aimed to avoid.

Id. (quotation and alterations omitted).

Although its reasoning differs slightly from the Sixth Circuit, the D.C. Circuit also signaled that it would require

exhaustion for claims against third-party purchasing banks in

some cases. The D.C. Circuit held that “[i]n FIRREA, the

word ‘claim’ is a term-of-art that refers only to claims that are

resolvable through the FIRREA administrative process, and

BENSON v. JPMORGAN CHASE BANK 3251
the only claims that are resolvable through the administrative

process are claims against a depository institution for which

the FDIC is receiver.” Am. Nat’l Ins. Co. v. FDIC, 642 F.3d

1137, 1142 (D.C. Cir. 2011). 

However, attempting to harmonize its position with that of

the Sixth Circuit, the court recognized that “plaintiffs cannot

circumvent FIRREA’s jurisdictional bar by drafting their

complaint strategically. 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.” Id. at 1144. Looking to

the facts of Village of Oakwood, the D.C. Circuit noted that

plaintiffs’ complaint in that case “alleged that the FDIC, not

the assuming bank, had breached its fiduciary duty.” Am.

Nat’l Ins. Co., 642 F.3d at 1144. On this basis, the court reasoned, “the Village of Oakwood plaintiffs’ suit was functionally a claim against the FDIC-as-receiver. . . [and] the court

of appeals correctly held the action jurisdictionally barred.”

Id. (citations omitted). The Eleventh Circuit has also concluded that FIRREA requires exhaustion for some claims

against purchasing banks, although it did not rely on the text

of § 1821(d)(13)(D) for its conclusion. See Am. First Fed.,

Inc. v. Lake Forest Park, Inc., 198 F.3d 1259, 1263 n.3 (11th

Cir. 1999). 

[5] We agree with these circuits that FIRREA’s jurisdictional bar applies to claims asserted against a purchasing bank

when the claim is based on the conduct of the failed institution.4

And although we recognize the D.C. Circuit’s holding in

4We are not persuaded by the cases that plaintiffs contend stand for the

proposition that FIRREA’s jurisdictional bar applies only to claims against

a failed bank, Freeman v. FDIC, 56 F.3d 1394 (D.C. Cir. 1995), and

Ambase Corp. v. United States, 61 Fed. Cl. 794 (2004). Although dicta

from those cases state that the bar applies to claims against a failed bank,

they simply do not address the question of whether FIRREA might apply

to a suit against a purchasing bank. See Village of Oakwood, 539 F.3d at

386-87 (holding that Ambase is inapposite). 

3252 BENSON v. JPMORGAN CHASE BANK
American National Insurance has a different formulation than

the approach in Village of Oakwood, we have no need to

resolve any potential tension between the two in this case.

The bulk of plaintiffs’ claims plainly qualify as “functionally,

albeit not formally” against a failed bank. Am. Nat’l Ins. Co.,

642 F.3d at 1144.

[6] Plaintiffs’ complaints are based almost exclusively on

alleged malfeasance by WaMu. They claim that WaMu knowingly provided banking services—including allowing the

Nevada LLCs to utilize CMT and RDC systems—despite its

actual knowledge of the Millennium Ponzi scheme. They

argue that JPMorgan is liable for this conduct because it

assumed WaMu’s liabilities pursuant to a purchase and

assumption agreement with the FDIC. By relying on WaMu’s

alleged wrongdoing, plaintiffs’ claims plainly “relat[e] to any

act or omission” of “a depository institution for which the

[FDIC] has been appointed receiver.” § 1821(d)(13)(D). And

because plaintiffs did not exhaust administrative remedies,

their claims are jurisdictionally barred by FIRREA.

B

Plaintiffs also contend that the district court erred by dismissing the portions of their claims based on JPMorgan’s

independent activity. In denying plaintiffs’ Rule 60(b)

motion, the district court held that “although Plaintiffs alleged

that practices continued after [JPMorgan] acquired WaMu in

September 2008, this assertion fell short of transforming

Plaintiffs’ claims into something other than claims ‘relating’

to WaMu’s alleged misconduct.” Moreover, the court held

that even if the complaints “include stand-alone allegations of

post-receivership misconduct by [JPMorgan], FIRREA still

applies” because the phrase “relating to” as used in

§ 1821(d)(13)(D)(ii) “has a deliberately broad and sweeping

meaning.”

[7] We disagree with the district court’s analysis. Claims

of independent misconduct by an institution that purchases a

BENSON v. JPMORGAN CHASE BANK 3253
failed bank are not covered by FIRREA’s exhaustion requirement. We need look no further than the plain language of the

statute to reach this conclusion. As relevant to this matter,

FIRREA requires exhaustion of claims “relating to any act or

omission of [a failed bank] or the [FDIC] as receiver.”

§ 1821(d)(13)(D)(ii). If a plaintiff alleges that a purchasing

bank aided and abetted a fraudulent scheme following its

assumption of a failed bank, that claim simply does not relate

to any act or omission of the failed bank or the FDIC.

The district court relied on Morales v. Trans World Airlines, Inc., 504 U.S. 374 (1992), in support of its expansive

interpretation of the phrase “relating to.” See id. at 383 (“The

ordinary meaning of these words [‘relating to’] is a broad one

— ‘to stand in some relation; to have bearing or concern; to

pertain; refer; to bring into association with or connection

with . . . .’ ” (quoting Black’s Law Dictionary 1158 (5th ed.

1979))). Because plaintiffs allege that JPMorgan continued

the tortious conduct that WaMu began, the district court ruled

that plaintiffs’ claims relate to the conduct of WaMu.

[8] This analysis misinterprets the operative language.

Although we do not quibble with the district court’s conclusion that the phrase “relating to” has a broad meaning, we

nevertheless hold that a claim alleging liability based only on

post-purchase misconduct of a purchasing bank would not

“relate to” acts or omissions of a failed bank for purposes of

FIRREA. The fact that JPMorgan acted in a manner that was

similar, or even identical, to the manner in which WaMu

acted does not alter our conclusion. The acts of the purchasing bank might be related to the acts of the failed bank, but

FIRREA’s jurisdictional bar applies when a claim relates to

the acts of a failed bank. § 1821(d)(13)(D)(ii). Purchase of a

failed bank does not buy an institution immunity to continue

in its predecessor’s malfeasance.

The D.C. Circuit’s decision in American National Insurance supports our conclusion. In that case, the court rejected

3254 BENSON v. JPMORGAN CHASE BANK
an argument that FIRREA barred a claim against JPMorgan

for allegedly engaging in an “elaborate scheme designed to

improperly and illegally take advantage of the financial difficulties of [WaMu] and strip away valuable assets of [WaMu]

without properly compensating the company or its stakeholders.” 642 F.3d at 1139 (quotation omitted). Such allegations

do not fall within FIRREA’s jurisdictional bar, the court held,

because “appellants allege that [JPMorgan], not the FDIC-asreceiver or [WaMu], itself committed the tortious acts for

which they claim relief.” Id. at 1144. 

[9] Although we reject plaintiffs’ assertion that their

claims based on WaMu’s conduct were not “susceptible of

resolution through the claims procedure,” see Henderson, 986

F.2d at 321, we agree that a claim based on JPMorgan’s own

acts could not be resolved by the FDIC and thus is not barred

by § 1821(d)(13)(D). As the D.C. Circuit explained, if “neither the failed depository institution nor the FDIC-as-receiver

bears any legal responsibility for claimant’s injuries, the

claims process offers only a pointless bureaucratic exercise.”

Am. Nat’l Ins. Co., 642 F.3d at 1143. 

JPMorgan seeks to distinguish American National Insurance on the ground that plaintiffs in this case advanced claims

with allegations of misconduct by both WaMu and JPMorgan.

But a plaintiff ’s decision to include allegations about both the

failed bank and the purchasing bank in a single complaint

does not require a court to treat those allegations in the same

manner. We frequently dismiss those portions of a claim that

are barred while permitting the remaining portion of a claim

to go forward. See, e.g., Guerrero v. Gates, 442 F.3d 697, 708

(9th Cir. 2006) (“We affirm the district court’s grant of the

defendants’ motions to dismiss . . . as to all but one half of

one of Guerrero’s § 1983 claims. We reverse as to that part

of Guerrero’s claim for excessive force resting on the 1997

incident.”). An adequately pled claim based on JPMorgan’s

own misconduct cannot fail merely because it is coupled with

a barred claim against WaMu. 

BENSON v. JPMORGAN CHASE BANK 3255
Although we hold that a plaintiff may sue based on a purchasing bank’s own wrongdoing without attempting to

exhaust FIRREA administrative remedies, we must still determine whether plaintiffs’ complaints adequately state such

claims. Each of plaintiffs’ specific allegations concern prepurchase misconduct by WaMu. The complaints do allege,

however, that the Millennium Ponzi scheme continued until

March 2009, several months after JPMorgan purchased

WaMu. In an introductory paragraph, plaintiffs allege that

WaMu knowingly aided and abetted the Ponzi scheme and

that “[t]hese practices continued after JPMorgan acquired

[WaMu] in September of 2008.” They further allege that

JPMorgan is liable “[f]or its own conduct and as [WaMu’s]

successor in interest.” 

[10] We conclude that plaintiffs’ conclusory allegations

regarding JPMorgan fall short of stating a claim for relief that

is free from FIRREA’s exhaustion requirements. The sole

allegation regarding JPMorgan is that unidentified “practices

continued” after acquisition; plaintiffs fail to allege a single

specific act taken by the purchasing bank. Further, we note

that each of the named plaintiffs who allege specific dates of

their CD purchases transferred funds to the Millennium Ponzi

scheme principals prior to WaMu’s failure. Without any allegations explaining how the amorphous “practices” of JPMorgan might relate to named plaintiffs’ injuries—which had

already occurred by the time WaMu failed—we cannot discern a properly pled claim based on the purchasing bank’s

misconduct. See Sprewell v. Golden State Warriors, 266 F.3d

979, 988 (9th Cir. 2001) (we need not “accept as true allegations that are merely conclusory”); see also Cedars-Sinai

Med. Ctr. v. Nat’l League of Postmasters, 497 F.3d 972, 975

(9th Cir. 2007) (applying rule in reviewing dismissal for failure to exhaust administrative remedies). 

Plaintiffs contend that the district court previously ruled

that their allegations stated valid claims by denying, in part,

JPMorgan’s Rule 12(b)(6) motion. But that order, issued

3256 BENSON v. JPMORGAN CHASE BANK
before any briefing on the impact of FIRREA, did not differentiate between pre- and post-purchase acts. As such, our conclusion that plaintiffs have not adequately pled a complaint

based on JPMorgan’s actions is not in tension with that ruling.

[11] Although we hold that a claim—or a portion of a

claim—based on JPMorgan’s independent, post-purchase

conduct would not be subject to FIRREA’s jurisdictional bar,

we conclude that plaintiffs’ complaints do not include such a

claim. Accordingly, the district court’s order dismissing the

complaints was proper despite our disagreement with its reasoning.

C

In addition to the substantive errors the plaintiffs argued in

their Rule 60(b) motion, they claimed that the district court

erred by dismissing the case without granting them leave to

amend their complaints. In denying that motion, the district

court stated that because final judgment had already been

entered, a motion for leave to amend may only be considered

“if the judgment is first reopened under a motion brought

under Rule 59 or 60.” Lindauer v. Rogers, 91 F.3d 1355, 1357

(9th Cir. 1996).

We question whether the rule of Lindauer applies here. A

separate judgment was not actually entered below.5 JPMorgan

claims that the district court’s order granting its Rule 12(b)(1)

motion was a “judgment” and thus Lindauer applies. JPMorgan’s theory appears inconsistent with this court’s jurispru5The fact that a separate judgment was never entered does not affect our

appellate jurisdiction because the district court’s dispositive order constituted “a full adjudication of the issues” and clearly demonstrated “the

judge’s intention that it be the court’s final act in the matter.” Casey v.

Albertson’s, Inc., 362 F.3d 1254, 1258 (9th Cir. 2004) (quotation omitted).

“[N]either the Supreme Court nor this court views satisfaction of Rule 58

as a prerequisite to appeal.” Kirkland v. Legion Ins. Co., 343 F.3d 1135,

1140 (9th Cir. 2003). 

BENSON v. JPMORGAN CHASE BANK 3257
dence regarding plaintiffs’ ability to amend as of right

following an order dismissing all claims. See Breier v. N. Cal.

Bowling Proprietors’ Ass’n, 316 F.2d 787, 789 (9th Cir.

1963) (“Neither the filing nor granting of such a motion [to

dismiss] before answer terminates the right to amend; an

order of dismissal denying leave to amend at that stage is

improper, and a motion for leave to amend (though unnecessary) must be granted if filed.”); see also Worldwide Church

of God, Inc. v. California, 623 F.2d 613, 616 (9th Cir. 1980)

(per curiam) (judgment, rather than order of dismissal, cuts

off right to amend prior to responsive pleading).

[12] Nevertheless, plaintiffs conceded at oral argument

that a judgment had been entered by the time plaintiffs filed

their Rule 60(b) motion. In light of this concession, we will

assume without holding that Lindauer applies. Because we

conclude that the district court’s dismissal was proper, there

was no basis to reopen the judgment under Rule 60(b).

Accordingly, Lindauer barred post-judgment amendment. To

the extent that plaintiffs argue that the district court’s dismissal without leave to amend was itself the mistake justifying reopening the case, we reject their argument because they

did not seek leave to amend before filing the Rule 60(b)

motion—at which point, they concede, judgment had been

entered. Plaintiffs cannot prevail on an argument that the district court should have sua sponte granted a motion they never

filed. See Alaska v. United States, 201 F.3d 1154, 1163 (9th

Cir. 2000) (“Where a party never asked for permission, its

argument that the ‘district court should have permitted’ is

without force.”). Accordingly, the district court’s denial of

plaintiffs’ Rule 60(b) motion was proper.

IV

For the foregoing reasons, we AFFIRM.

3258 BENSON v. JPMORGAN CHASE BANK