Opinion ID: 2773213
Heading Depth: 2
Heading Rank: 2

Heading: Principal/Agent Relationship

Text: The Bankruptcy Court determined, and we agree, that the TSA cannot be read as creating a principal/agent relationship under California law because Downey Bank did not exercise control over DFC’s activities under the agreement. FDIC v. Siegel (In re IndyMac Bancorp, Inc.), 554 F. App’x 668, 670 (9th Cir. 2014).4 The TSA did not create for any subsidiary, including Downey Bank, an ability to control DFC’s activities with respect to tax filing and refund allocation. Additionally, DFC had sole power to decide whether to seek a refund rather than a credit against the Affiliated Group’s future liability. TSA § 2.4(a) Contrary to Appellant’s argument, the so-called “Bob Richards default rule” (which would assume an agency relationship in the consolidated tax filing context) is not Declaration was inadmissible because contract interpretation is a legal question for which the court does not require expert opinion. Id. 4 Appellant argues that IndyMac is distinguishable because in that case the parties agreed that the TSA was unambiguous. While the bankruptcy court opinion in IndyMac stated that both parties argued that the TSA was unambiguous in multiple briefs, the parties in IndyMac put forth contrary readings of the TSA — even while calling it “unambiguous” — thereby necessitating the court to engage in the same analysis as is required here. Siegel v. FDIC (In re IndyMac Bancorp Inc.), No. 2:08-bk-21752, 2012 Bankr. LEXIS 1462, at  (Bankr. C.D. Ca. March 29, 2012). (“Thus, after considering all the materials before it, the Court has concluded that the TSA is not ambiguous, either on its face . . . or following a preliminary reference to the pertinent extrinsic evidence.”). 4 applicable here because the parties have agreed to a TSA. In re IndyMac Bancorp, Inc., 554 F. App’x at 670; Sharp v. FDIC (In re Vineyard Nat’l Bancorp), 508 B.R. 437, 443 (Bankr. C.D. Cal. 2014).