Opinion ID: 211711
Heading Depth: 2
Heading Rank: 3

Heading: Proceedings Before the Court of Federal Claims

Text: 14 The Institutional Plaintiffs and the Individual Plaintiffs filed suit in the Court of Federal Claims to recover damages they incurred by the enactment of FIRREA. In SoCal I, the court addressed issues of the government's liability. In response to a summary judgment motion on behalf of all the plaintiffs, the government admitted that it had an express contract with the Institutional Plaintiffs, but argued that the Individual Plaintiffs lacked standing because they did not have privity of contract. SoCal I, 52 Fed.Cl. at 541. The court found that the government's execution of the Assistance Agreement, the RCMA and the FHLBB implementing resolutions all on the same day evidenced its intent to contract with all the plaintiffs. Id. at 542. Interpreting the merger clause of the Assistance Agreement to support this conclusion, the court found that the transactional documents created one overall contract to which the Individual Plaintiffs, as well as the Institutional Plaintiffs, were party. Id. at 543. Accordingly, the court held that the Individual Plaintiffs had standing to sue and granted the plaintiffs' summary judgment motion finding the government liable for breach of the overall contract. Id. at 549. 15 After a two month trial, the Court of Federal Claims issued an opinion awarding damages to the plaintiffs. The court awarded the Institutional Plaintiffs a total of $65,397,821.41 for wounded bank damages and cost of replacement capital damages. SoCal II, 57 Fed.Cl. at 601. Wounded bank damages, which the court classified as a type of reliance damages, compensate for the costs incurred by the thrift because of its status as a troubled or under-capitalized institution. Id. at 624. Such costs include higher costs of funds, higher insurance and regulatory premiums and assessments, and extra attorney and consultant fees to interface with the regulators. Id. Damages for cost of replacement capital, which the court also classified as a form of reliance damages, compensate for the money spent by the thrift to replace the goodwill lost as a result of the government's breach. Id. In regards to the Individual Plaintiffs, the Court of Federal Claims awarded a total of $22,448,293.75 in dilution damages. Id. at 601. Under the dilution theory, which the court classified as a form of restitution damages, id. at 623, the Individual Plaintiffs were awarded either the value of the breached thrift at a given point in time or a dollar amount corresponding with the cost of replacing their equity in the breached thrift, id. at 634. 16 Final judgment in the case was entered on September 10, 2003. The government filed a timely Notice of Appeal and now challenges the holding that the Individual Plaintiffs have standing to sue and the amount of damages awarded to both the Individual Plaintiffs and the Institutional Plaintiffs. This court has jurisdiction pursuant to 28 U.S.C. § 1295(a)(3).