Opinion ID: 6315
Heading Depth: 2
Heading Rank: 1

Heading: claims for monetary damages

Text: 12 Initially, Carney and Fisher allege that the district court erred in determining that it did not have subject matter jurisdiction over their claims for monetary damages. Subject matter jurisdiction is determined at the time that the complaint is filed. Rosa v. Resolution Trust Co., 938 F.2d 383, 392 n. 12 (3d Cir.), cert. denied, --- U.S. ----, 112 S.Ct. 582, 116 L.Ed.2d 608 (1991); F. Alderete Gen. Contractors v. United States, 715 F.2d 1476, 1480 (Fed.Cir.1983). The district court determined that at the time Carney and Fisher filed their second amended complaint the RTC had been named as receiver for New MeraBank and that, therefore, the jurisdictional bar of FIRREA required Carney and Fisher to exhaust their administrative remedies before it could obtain jurisdiction over their claims for monetary damages against the RTC. Carney and Fisher argue, however, that their second amended complaint relates back to the time that they filed their first amended complaint and that FIRREA's jurisdictional bar would not therefore apply to their claims for monetary damages because they filed their first amended complaint before the RTC was named as receiver. 13 In Sessions v. Rusk State Hosp., we stated that 14 [a] complaint that is defective because it does not allege a claim within the subject matter jurisdiction of a federal court may be amended to state a different claim over which the federal court has jurisdiction. If the claim asserted in the amendment arises out of the conduct or occurrence set forth in the original complaint, the amendment is given retroactive effect to the date the original complaint was filed. 15 648 F.2d 1066, 1070 (5th Cir.1981) (citations omitted). Relation back to the date of the original filing applies even when the amendment states a new basis for subject matter jurisdiction. Berkshire Fashions, Inc. v. M.V. Hakusan II, 954 F.2d 874, 887 (3d Cir.1992) (determining that when the plaintiffs amended their complaint to establish diversity jurisdiction the amendment related back to the date of the filing of the original complaint so that the statutory requirement of $10,000 to establish diversity jurisdiction applied instead of the new $50,000 requirement); 3 JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE p 15.15[3.-2], at 15-154 (2d ed. 1993) (noting that an amendment which changes the jurisdictional basis of an action will relate back to the date of the filing of the original complaint, if the factual situation alleged otherwise remains unaltered); 6A CHARLES ALAN WRIGHT ET AL., FEDERAL PRACTICE & PROCEDURE Sec. 1497, at 80 (2d ed. 1990) (Amendments curing a defective statement of subject matter jurisdiction ... will relate back.). In this case, the district court should have determined whether Carney and Fisher's second amended complaint related back to the time that they filed their original complaint or their first amended complaint. For purposes of this appeal, however, we need not determine whether Carney and Fisher's second amended complaint should be characterized as relating back to the time of the filing of the original complaint or the first amended complaint. Under either scenario, Carney and Fisher would have filed their claims for monetary damages before the RTC was appointed receiver for New MeraBank. 16 We now address Carney and Fisher's argument that because they filed their claims for monetary damages before the RTC was appointed receiver for New MeraBank, FIRREA's jurisdictional bar does not apply to those claims. Section 1821(d)(13)(D) of FIRREA provides that: 17 Except as otherwise provided in this subsection, no court shall have jurisdiction over-- 18 (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 19 (ii) any claim relating to any act or omission of such institution or the Corporation as receiver. 20 12 U.S.C. Sec. 1821(d)(13)(D) (Supp. IV 1992). In Meliezer v. Resolution Trust Co., we determined that Sec. 1821(d)(13)(D) of FIRREA deprived a district court of subject matter jurisdiction over claims brought against the RTC after the RTC was appointed receiver of a depository institution. 952 F.2d 879, 881-82 (5th Cir.1992). In this case, however, the claims asserted by Carney and Fisher against the RTC relate back to a date before the RTC was appointed receiver of New MeraBank. The question presented here is whether claims filed, under a relation back theory, before the RTC is appointed receiver are also subject to FIRREA's jurisdictional bar. 21 We note initially that FIRREA makes participation in the administrative claim review process mandatory, regardless of whether the claims were filed before or after the RTC was appointed receiver of the failed institution. Bueford v. Resolution Trust Corp., 991 F.2d 481, 485 (8th Cir.1993); Marquis v. FDIC, 965 F.2d 1148, 1151 (1st Cir.1992); Resolution Trust Corp. v. Mustang Partners, 946 F.2d 103, 106 (10th Cir.1991); see Meliezer v. Resolution Trust Co., 952 F.2d 879, 882 (5th Cir.1992) (holding that FIRREA establishes a statutory exhaustion requirement). Naturally, the RTC argues that FIRREA's jurisdictional bar applies to both pre- and post- receivership claims. However, we agree with other circuits that have addressed this issue and conclude that when claims for monetary damages are brought before the RTC is appointed receiver, a court continues to have subject matter jurisdiction over those claims. Brady Dev. Co. v. Resolution Trust Corp., 14 F.3d 998, 1003 (4th Cir.1994); Marquis, 965 F.2d at 1152-53; Rosa v. Resolution Trust Corp., 938 F.2d 383, 392 (3d Cir.), cert. denied, --- U.S. ----, 112 S.Ct. 582, 116 L.Ed.2d 608 (1991). Several sections of FIRREA support this conclusion. For example, Sec. 1821(d)(6)(A) permits a claimant to continue an action commenced before the appointment of the receiver after the RTC has denied the claim. Additionally, Sec. 1821(d)(5)(F)(ii) provides that the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action which was filed before the appointment of the receiver. It appears clear to us that a claimant could not continue an action that should have been dismissed. Marquis, 965 F.2d at 1152-53 (noting that because Sec. 1821(d)(5)(F)(ii) refers to a claimant's right to continue an action, Congress did not intend for the action to be dismissed); Guidry v. Resolution Trust Corp., 790 F.Supp. 651, 653 (E.D.La.1992) (noting that the word continue in Secs. 1821(d)(5)(F)(ii), (d)(6)(A) strongly infers that the court retains jurisdiction over a case that is filed before a receiver is appointed); Coston v. Gold Coast Graphics, Inc., 782 F.Supp. 1532, 1535 (S.D.Fla.1992) (stating that the term 'continue' in both Sec. 1821(d)(5)(F)(ii) and Sec. 1821(d)(6)(A) indicates that the Court is not deprived of jurisdiction over the action). Therefore, we conclude that because Carney and Fisher filed their claims against the RTC before the RTC was appointed receiver of New MeraBank, the district court had subject matter jurisdiction over their claims. 22 However, our conclusion that the district court had subject matter jurisdiction over Carney and Fisher's claims for monetary damages against the RTC does not necessarily mean that Carney and Fisher can assert their administrative and judicial remedies concurrently. Congress enacted FIRREA to create an efficient method for processing claims against failed banks. Meliezer v. Resolution Trust Co., 952 F.2d 879, 881 (5th Cir.1992). It appears clear to us that allowing a claimant simultaneously to pursue administrative and judicial remedies would thwart Congress' purpose in enacting FIRREA. We conclude, as other courts have done, that FIRREA creates a scheme under which courts will retain jurisdiction over pending lawsuits--suspending, rather than dismissing, the suits--subject to a stay of proceedings as may be appropriate to permit exhaustion of the administrative review process as it pertains to the underlying claims. Marquis, 965 F.2d at 1154; see also Guidry, 790 F.Supp. at 654-55; In re FDIC, 762 F.Supp. 1002, 1004 (D.Mass.1991). 1 23 In summary, the district court erred in dismissing Carney and Fisher's claims for monetary damages against the RTC for lack of subject matter jurisdiction. 24