Opinion ID: 564786
Heading Depth: 3
Heading Rank: 3

Heading: Exceptions to Exhaustion

Text: 53 Given that some of plaintiffs' claims are subject to the jurisdictional bar, we must address plaintiffs' and PBGC's arguments that exhaustion should be excused and plaintiffs' arguments that the claims procedure is unconstitutional. Because we have determined that plaintiffs' claims for nonmonetary relief do not fall within the bar, we need only address these arguments as they relate to claims for monetary relief. 54 Plaintiffs and PBGC assert that exhaustion of the claims procedure should be excused in this case on a variety of grounds. RTC maintains that judicial exceptions to exhaustion do not apply where exhaustion is a statutory jurisdictional requirement, and that, in any event, plaintiffs and PBGC have not established the applicability of any exception. 55 Initially we note that we are not confronted with a judicially created exhaustion requirement, but with one that is mandated by statute. Further, Congress made this statutory exhaustion requirement explicitly jurisdictional. We are thus mindful of our responsibility to apply this requirement with a regard for the particular administrative scheme at issue. See Weinberger v. Salfi, 422 U.S. 749, 765, 95 S.Ct. 2457, 2466, 45 L.Ed.2d 522 (1975). 56 In this case we need not decide whether an exception can ever apply to the statutory exhaustion requirement embodied in Sec. 1821(d)(13)(D), because the theories advanced by plaintiffs and PBGC do not warrant recognition of an exception here. 57 Plaintiffs contend that requiring exhaustion would be futile in this case because RTC has already stated its position on the merits of their claims. PBGC makes the related argument that RTC has already made a final determination on the controlling legal question. 58 We do not believe that requiring exhaustion of the monetary claims in this case would be futile. RTC's legal position in this litigation is not necessarily conclusive of the receiver's determination of plaintiffs' claims. If RTC as receiver were to allow and satisfy plaintiffs' claims in whole or in part, the dispute now before this court would be moot to that extent. 59 Plaintiffs also insist that the receiver is not able to grant the relief they request. First, they state that, even if the receiver were to allow their claims, at most they will be granted a 'Receiver's Certificate' against an assetless entity, and without recoupment of their substantial attorneys' fees and costs. Second, they argue that they will be unable to obtain the type of preliminary, equitable or remedial relief they seek. Third, they argue that there was no ability to cure the irreparable harm in failing to have the Plan properly funded.... 60 The thrust of plaintiffs' argument is that the receiver is unable to provide them with monetary relief. We are unable at this stage to say that the receiver could not compensate plaintiffs through the claims procedure. The assets available for these and other creditors, as well as plaintiffs' priority status, are neither part of the record before us nor determinable by this court at this juncture but are properly determinable by the receiver. Nor does the possible six-month period for exhaustion of the claims procedure 16 in and of itself render the claims procedure inadequate, in contrast to the limitless delay that could be imposed by FSLIC in Coit Independence Joint Venture v. Federal Sav. & Loan Ins. Corp., 489 U.S. 561, 587, 109 S.Ct. 1361, 1376, 103 L.Ed.2d 602 (1989). 61 To the extent plaintiffs argue that the receiver is unauthorized or unable to provide the nonmonetary relief they request, we agree, and for that reason have already determined that such claims are not subject to the bar. 62 We turn now to plaintiffs' argument that because they cannot obtain allowance of attorneys' fees and costs in the claims procedure, the remedy afforded by that procedure is inadequate and, therefore, they should not be required to exhaust. We assume that in speaking of attorneys' fees and costs plaintiffs refer to expenses incurred in this litigation. Plaintiffs' argument presupposes that the district court could grant such fees and costs. We think this presupposition is invalid because, as to claims over which the district court lacked jurisdiction, even the district court could not grant such fees. Thus, the receiver's alleged inability to award attorneys' fees incurred in this litigation does not speak to the adequacy of the claims procedure. 63 PBGC argues that the purposes underlying exhaustion are not served by requiring plaintiffs to comply with the claims procedure, and thus exhaustion should be excused. In particular, PBGC contends that the purposes of exhaustion are not served when only legal issues are involved, i.e., whether appellants violated ERISA, and where RTC has no expertise as to those legal issues. See, e.g., Flying Tiger Line v. Teamsters Pension Trust Fund, 830 F.2d 1241, 1252-53 (3d Cir.1987); Bethlehem Steel Corp. v. Environmental Protection Agency, 669 F.2d 903, 907 (3d Cir.1982). We again stress that we must examine this question in light of the particular scheme envisioned under FIRREA. See Salfi, 422 U.S. at 765, 95 S.Ct. at 2466. The primary purpose underlying FIRREA's exhaustion scheme is to allow RTC to perform its statutory function of promptly determining claims so as to quickly and efficiently resolve claims against a failed institution without resorting to litigation. See H.R.Rep. No. 101-54(I), 101st Cong., 1st Sess. 418-19, reprinted in 1989 U.S.Code Cong. & Admin.News 86, 214-15. Thus, the purpose underlying exhaustion in this context is more limited than under other schemes. This is reasonable given the brevity of the exhaustion procedure and the de novo judicial review of claims once the procedure is exhausted. Because exhaustion in this case will fulfill this narrow purpose, no exception is warranted.