Opinion ID: 628691
Heading Depth: 2
Heading Rank: 2

Heading: Imputation to FDIC

Text: 13 FDIC claims that even if Sunrise is responsible for the misrepresentations contained in the loan documents, these false statements cannot be imputed to FDIC under established federal common law. Specifically, FDIC clings to the doctrine announced in D'Oench, Duhme & Co. v. FDIC, 315 U.S. 447, 62 S.Ct. 676, 86 L.Ed. 956 (1942) to support its assertion that the wrongful conduct committed by a failed federally insured financial institution cannot be imputed to FDIC when it is liquidating the assets of that institution. FDIC cites numerous cases interpreting D'Oench, Duhme to mean that the FDIC does not merely stand in the shoes of the failed institution, but instead can take greater rights to an asset of that institution. Among these cases is FDIC v. O'Melveny & Meyers, 969 F.2d 744 (9th Cir.1992), in which the Ninth Circuit explained that the equitable defense of imputation of knowledge does not apply to the FDIC acting as receiver. 14 FDIC's assertion of D'Oench, Duhme is fatally flawed, however, by FDIC's failure to raise this issue in the district court. By well settled convention, appellate courts generally will not consider an issue or theory that was not raised in the district court. Ford v. U.S., 989 F.2d 450, 453 (11th Cir.1993); see also United States v. Allegheny-Ludlum Industries, Inc., 517 F.2d 826, 840 n. 13 (5th Cir.1975); Brickner v. Voinovich, 977 F.2d 235, 238 (6th Cir.1992). FDIC seeks to avoid this rule by calling upon this Court's opinion in In re Daikin Miami Overseas, Inc., 868 F.2d 1201 (11th Cir.1989), which enumerated five exceptions to this general rule. According to Daikin, an appellate court may consider an issue presented for the first time when: the refusal to consider the pure question of law would result in a miscarriage of justice; the appellant had no opportunity to raise it below; there is at stake a substantial interest of justice; the proper resolution is beyond any doubt; or the issue presents significant questions of great public concern. Daikin, 868 F.2d at 1207. 15 FDIC urges this Court to entertain its D'Oench, Duhme argument because a pure question of law is at issue, the issue arose sua sponte from the district court's opinion, and the litigation is of national concern because it involves the mission of the FDIC. While FDIC correctly asserts that a pure question of law is involved and the issue is one of general impact, this issue did not arise sua sponte from the district court's opinion. FDIC quotes a portion of the district court's opinion that characterizes the resolution of this dispute as trying to determine who should bear the risk of loss between two innocent parties, and argues that neither party addressed their rights under the district court's balancing test. After stipulating that neither Sunrise nor Verex knew about the borrowers' misrepresentations, FDIC cannot seriously contend that only after the district court's opinion did it realize that the case involved who must bear the loss between two innocent parties. Indeed, this entire case is predicated on the question of who should prevail after the unknown wrongdoing of the third party borrowers. The parties argued in their briefs before the district court that the borrowers' misrepresentations should not be imputed to Sunrise, and FDIC had ample opportunity to raise this same issue with regard to itself. Further, no substantial interest of justice is at stake, as these interests are generally equated with the vindication of fundamental constitutional rights. Daikin, 868 F.2d at 107. Therefore, we decline to consider FDIC's late-breaking D'Oench, Duhme argument.