Opinion ID: 691111
Heading Depth: 2
Heading Rank: 2

Heading: Claims for fraudulent and negligent concealment

Text: 41 Brookside argues that its claims for fraudulent and negligent concealment are not barred by D'Oench, Duhme because the common-law doctrine does not bar claims for concealment or omission rather than affirmative misrepresentation. We join all the courts of appeal that have rejected this argument. See RTC v. Ehrenhaus, 34 F.3d 441, 442 (7th Cir.1994); McCullough v. FDIC, 987 F.2d 870, 873 (1st Cir.1993); FDIC v. Bell, 892 F.2d 64, 66 (10th Cir.1989), cert. dismissed, 496 U.S. 913, 110 S.Ct. 2607, 110 L.Ed.2d 286 (1990). Brookside cannot avoid D'Oench, Duhme estoppel by recasting the bank officers' active misrepresentation that the appraisal value was $1.78 million as an omission of the fact that the actual appraisals were lower. That logic would reward artful pleading and thwart the D'Oench, Duhme policy, as nearly every fraudulent misstatement can also be characterized as a deceitful concealment of the true state of affairs. See NBW Commercial Paper, 826 F.Supp. at 1462-63.