Opinion ID: 1427319
Heading Depth: 3
Heading Rank: 3

Heading: Motions by State Bank and the FDIC for summary judgment

Text: Turning now to the merits of the case, the Uninsured Depositors argue that even if jurisdiction was proper in the district court, the court's grant of summary judgment to State Bank and the FDIC was improper for three reasons. According to the Uninsured Depositors, the district court erred by (1) granting summary judgment before discovery was completed, (2) applying FIRREA's administrative process to the claims against State Bank, and (3) failing to properly apply Ohio state law to the Uninsured Depositors' claims. Each of these arguments will be addressed in turn.
The Uninsured Depositors argue that they were denied discovery and that the district court therefore erred in granting summary judgment to State Bank and the FDIC. In response, State Bank and the FDIC contend that the Uninsured Depositors waived this argument by failing to file a motion in the district court for additional discovery pursuant to Rule 56(f) of the Federal Rules of Civil Procedure. Moreover, the Uninsured Depositors agreedin the report of the parties' planning conferencethat a discovery plan would be premature until the pending dispositive motions have been ruled upon. The Uninsured Depositors' argument on this issue is presented in one sentence, with a citation to only two inapposite Second Circuit cases. One of those cases is Long Island Lighting Co. v. Barbash, 779 F.2d 793 (2d Cir.1985), where the Second Circuit reversed the district court's grant of summary judgment because the district court abused its discretion when it cut off discovery suddenly. Id. at 795. The district court had required the plaintiff to examine a witness under oath at a hearing without notice or an opportunity to review... documents that had just been produced. Id. Moreover, the court improperly circumscribed counsel's questions ... when it denied counsel's requests to question anyone other than [the witness]. Id. On the basis of these actions, the Second Circuit concluded that the plaintiff was denied a meaningful opportunity to establish the elements of its claim. Id. There have been no allegations of any such improper actions on the part of the district court in the present case. The other case cited by the Uninsured Depositors, Landmark Land Co. v. Sprague, 701 F.2d 1065 (2d Cir.1983), is equally inapplicable. In Landmark Land, the Second Circuit noted that [b]ecause summary judgment was granted before any significant discovery took place, we are left in much uncertainty as to the events which gave rise to this litigation. Id. at 1068. Yet the court did not conclude that the district court had erred for that reason. Instead, the Second Circuit reversed the district court because, on the basis of the parties' submissions, the court determined that there was a genuine issue of material fact that made summary judgment improper. Id. Landmark Land, therefore, does not stand for the proposition advocated by the Uninsured Depositorsthat a grant of summary judgment prior to the completion of discovery is improper as a matter of law. More importantly, however, the Uninsured Depositors had agreed that discovery was unnecessary to rule on the motions now on appeal when the parties filed with the district court the report of their planning conference. At no time did the Uninsured Depositors file a Rule 56(f) motion to inform the district court that additional discovery was needed. This court has previously held that such a motion is necessary in order to `preserve the argument that the grant of summary judgment was too hasty and precluded necessary discovery.' Compuware Corp. v. Bahn, 107 Fed.Appx. 528, 530 (6th Cir.2004) (quoting Plott v. Gen. Motors Corp., Packard Elec. Div., 71 F.3d 1190, 1196 (6th Cir.1995)). Accordingly, we conclude that the Uninsured Depositors have waived the argument that they were improperly denied discovery by the district court.
The district court concluded that the Uninsured Depositors' claims were barred by the administrative process outlined in 12 U.S.C. § 1821(d), which sets forth the procedure under FIRREA for making claims against the FDIC. Although the court recognized that the Uninsured Depositors actually brought their claims solely against State Bank rather than against the FDIC, it concluded that the same statutory framework prohibited the Uninsured Depositors from bringing the same claims against State Bank. The district court engaged in a thorough analysis of § 1821(d) and determined that the Uninsured Depositors' failure to comply with the administrative process prevented them from bringing the instant action. We agree with that analysis. FIRREA's administrative-claims process has been succinctly summarized as follows: Upon its appointment as receiver, FDIC is required to publish notice that the failed institution's creditors must file claims with FDIC by a specified date not less than ninety days after the date of publication. 12 U.S.C. § 1821(d)(3)(B). FDIC is also required to mail notice to all known creditors of the failed institution. [12 U.S.C.] § 1821(d)(3)(C). It has 180 days from the date of filing to allow or disallow claims. [12 U.S.C.] § 1821(d)(5)(A)(i). Claimants have sixty days from the date of disallowance, or from the expiration of the 180-day administrative decision deadline, within which to seek judicial review in an appropriate United States district court. [12 U.S.C.] § 1821(d)(6)(A). Simon v. FDIC, 48 F.3d 53, 56 (1st Cir. 1995) (alterations added). Section 1821(d) clearly establishes a process for the administrative review of any claim against a depository institution for which the Corporation is receiver. 12 U.S.C. § 1821(d)(6)(A)(i). Pursuant to § 1821(d)(6)(B)(ii), if a party fails to comply with the statutory time limitations, any claim that a party has shall be deemed to be disallowed (other than any portion of such claim which was allowed by the receiver) as of the end of such period, such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim. Section 1821(d) also contains an explicit subsection titled Limitation of judicial review. The pertinent subsection reads as follows: (D) Limitation of judicial review Except as otherwise provided in [§ 1821(d)], 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 Corporation has been appointed receiver, including assets which the Corporation may acquire from itself as such receiver; or (ii) any claim relating to any act or omission of such institution or the Corporation as receiver. 12 U.S.C. § 1821(d)(13)(D). This court, in the initial appeal of this action, noted its skepticism that the uninsured depositors' claims can survive FIRREA's bar against courts adjudicating `any claim relating to any act or omission of ... the Corporation as receiver.' Village of Oakwood, 481 F.3d at 369. Other courts have recognized a tension between § 1821(d)(6)(A)'s process for reviewing claims that are against a depository institution and the broad prohibition against judicial review of any claim relating to any act or omission of ... the Corporation as receiver found in § 1821(d)(13)(D)(ii). As the D.C. Circuit explained in Auction Co. II, for claims that are not against a depository institution but that do fall within (d)(13)(D), the effect of the two sections, on a plain language approach, would be not to impose an administrative exhaustion requirement but to foreclose judicial jurisdiction altogether, a result troubling from a constitutional perspective and certainly not the goal of FIRREA. Auction Co. II, 141 F.3d at 1200. In order to resolve this ambiguity, every court that has addressed the issue has interpreted § 1821(d)(13)(D) as imposing a statutory exhaustion requirement rather than an absolute bar to jurisdiction. Home Capital Collateral, Inc. v. FDIC, 96 F.3d 760, 763 (5th Cir.1996); see also Freeman v. FDIC, 56 F.3d 1394, 1400 (D.C.Cir. 1995) (The effect of these provisions, read together, is to require anyone bringing a claim against or `seeking a determination of rights with respect to' the assets of a failed bank held by the FDIC as receiver to first exhaust administrative remedies by filing an administrative claim under the FDIC's administrative claims process.); Hudson United Bank v. Chase Manhattan Bank of Conn., 43 F.3d 843, 849-50 (3d Cir.1994) (By deciding the administrative claims procedure and the jurisdictional bar have concurrent scope, we avoid the possibility... that § 1821(d)(13)(D) could become `an independent and outright bar of jurisdiction' rather than a mere exhaustion requirement....); Brady Dev. Co., v. Resolution Trust Corp., 14 F.3d 998, 1003 (4th Cir.1994) (The precise jurisdictional limitations on the Article III courts mandated by FIRREA are determined by reading section 1821(d)(13) in conjunction with the statute's allowance of an action within sixty days of a claim being denied as provided for in section 1821(d)(6)(A).); Bueford v. Resolution Trust Corp., 991 F.2d 481, 484 (8th Cir.1993) (Every court that has considered the issue has found exhaustion of FIRREA's administrative remedies to be a jurisdictional prerequisite to suit in district court.). We now join our sister circuits in adopting this approach, which means that the Uninsured Depositors' failure to file an administrative claim within the period provided by § 1821(d)(6) results in their having no further rights or remedies with respect to such claim[s] pursuant to § 1821(d)(6)(B)(ii). The Uninsured Depositors concede that they failed to comply with the administrative-claims process outlined in FIRREA. But they raise three arguments on appeal regarding the district court's determination that by failing to pursue their claims through the administrative process, they are barred from seeking relief in federal court. These three arguments are presented in a total of two paragraphs from the Uninsured Depositors' brief and are accompanied by only three case citations. First, the Uninsured Depositors contend that their claims against State Bank were not `claim[s] against a depository institution for which the [FDIC was] receiver,' under 12 U.S.C. § 1821(d)(6). This naked assertion appears to be an argument that because the Uninsured Depositors have sued only State Bank, rather than the FDIC, their claims fall completely outside of the framework of FIRREA's administrative process. The problem with this novel argument is that all of their claims against State Bank are directly related to acts or omissions of the FDIC as the receiver of Oakwood. As the district court explained, accepting the Uninsured Depositors argument and permit[ting] 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. See Brady Dev. Co., 14 F.3d at 1002-03 (describing the goal of FIRREA as providing `funds from public and private sources to deal expeditiously' with faltering and failed savings and loans). Moreover, because the claims that the Uninsured Depositors are attempting to assert are disallowed as a result of their failure to comply with the administrative-claims process, they have no further rights or remedies with respect to such claim[s] despite the fact that they purport to bring them against State Bank rather than the FDIC. See 12 U.S.C. § 1821(d)(6)(B)(ii). The Uninsured Depositors' last two arguments relate to what they consider precedents indicating that [o]ther courts agree that the jurisdictional bar in 12 U.S.C. § 1821(d)(13)(D) does not apply. They claim that Ambase Corp. v. United States, 61 Fed.Cl. 794, 798 (Fed.Cl.2004), stands for the proposition that Section 1821(d) of Title 12 U.S.C. would not bar State Bank's or the Uninsured Depositors' claims if they had been asserted in the United States Court of Federal Claims. Ambase, however, involved a putative shareholder derivative suit that was brought directly against the United States, a suit that the FDIC joined as an intervenor-plaintiff. In rejecting the FDIC's argument that § 1821(d)(13)(D) barred review of its management of a receivership, the Ambase court explained that the claim was not against the receivership, but rather against the United States for breach of a goodwill contract. 61 Fed.Cl. at 799 (emphasis in original). The Uninsured Depositors' claims here, however, are not against the United States, but instead arise directly out of the acts and omissions of the FDIC as receiver for Oakwood. This distinction renders Ambase inapposite to the present case. The Uninsured Depositors' final argument, based on decisions from the Tenth Circuit and the Eastern District of Michigan, is that § 1821(d)(13)(D) does not preclude the review of claims arising out of actions taken by the FDIC after it has taken over a depository institution. In Homeland Stores, Inc. v. Resolution Trust Corp., 17 F.3d 1269 (10th Cir.1994), the Tenth Circuit held that the administrative-claims process applied only to creditor and related claims arising before an institution enters receivership. Id. at 1274. The court explained that claims such as [the plaintiff's] arising after receivership and in the indeterminate future due to management actions of the [receiver] cannot have been contemplated when [the] deadlines for filing administrative claims were set. Relying on Homeland Stores, the United States District Court for the Eastern District of Michigan concluded that the administrative process of § 1821 does not cover claims that arise after receivership from the independent acts of the governmental agency. Lopez-Flores v. Resolution Trust Corp., 93 F.Supp.2d 834, 849 (E.D.Mich.2000). But the court in Lopez-Flores relied on the fact that by the time Lopez-Flores's claim had accrued, the ninety day period had expired. Id. at 845. No such problem exists in the present case, where the Uninsured Depositors' claims accrued upon the consummation of the P & A Agreement. Moreover, the above two cases appear to be the only ones to reach this particular conclusion. The overwhelming majority of courts to address the issue have concluded that the administrative process applies to post-receivership claims. In fact, this court has explained that § 1821(d)(13)(D) precludes a court from acquiring jurisdiction after the receiver is appointed, but that § 1821(d)(6) provides an exception to that rule for claim[s] disallowed by the receiver through the administrative claim process. In re Lewis, 398 F.3d 735, 744 (6th Cir.2005) (emphasis in original); see also McCarthy v. FDIC, 348 F.3d 1075, 1081 (9th Cir.2003) (joining the majority of courts in holding that claimants ... who challenge conduct by the FDIC as receiver, must exhaust administrative remedies before seeking judicial review); Stamm v. Paul, 121 F.3d 635, 639-42 (11th Cir.1997) (interpreting § 1821(d)(6) as providing an administrative basis to review post-receivership claims based on the receiver's actions); Home Capital Collateral, Inc., 96 F.3d at 763-64 (holding that FIRREA's exhaustion requirement applies to claims arising post-receivership based on actions of the receiver); Rosa v. Resolution Trust Corp., 938 F.2d 383, 393-94 (3d Cir.1991) (concluding that claims against the receiver fall within the language of § 1821(d)(13)(D)(i)); Ladd v. Second Nat. Bank of Warren, 941 F.Supp. 87, 91 (N.D.Ohio 1996) (dismissing post-receivership claims for failure to initiate the administrative process); Holmes Fin. Assocs. v. Resolution Trust Corp., 33 F.3d 561, 563 n. 1 (6th Cir.1994) (citing Rosa 's post-receivership claim in observing that courts have unanimously inferred the existence of an exhaustion requirement under FIRREA). Ultimately, the Uninsured Depositors failed to comply with the clearly delineated procedure for seeking review of their claims arising out of the collapse of Oakwood. We thus have no need to address the substance of these disallowed claims for successor liability, aiding and abetting a breach of fiduciary duty, constructive trust, and breach of contract.