Court Opinion

ID: 2962374
Source: CourtListenerOpinion
Date Created: 2015-09-21 20:56:59.623946+00
Date Added: 2024-06-11T15:02:01.461999
License: Public Domain

USCA1 Opinion

	

          February 8, 1994      [NOT FOR PUBLICATION]                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ___________________          No. 93-1445                                             WILLIAM BART LLOYD,                                Plaintiff, Appellant,                                          v.                        FEDERAL DEPOSIT INSURANCE CORPORATION,                                 Defendant, Appellee.                                  __________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF RHODE ISLAND                    [Hon. Ronald R. Lagueux, U.S. District Judge]                                             ___________________                                 ___________________                                        Before                                 Breyer, Chief Judge,                                         ___________                          Selya and Boudin, Circuit Judges.                                            ______________                                 ___________________               William Bart Lloyd on brief pro se.               __________________          ___ __               Ann  S.  Duross,  Assistant   General  Counsel,  Richard  J.               _______________                                  ___________          Osterman, Jr., Senior Counsel, and Daniel H. Kurtenbach, Counsel,          _____________                      ____________________          on brief for appellee.                                  __________________                                  __________________                 SELYA, Circuit Judge.   William Bart Lloyd  appeals from                        _____________            an order of the United States District Court for the District            of  Rhode  Island  dismissing his  suit  against  the Federal            Deposit  Insurance Corporation  (FDIC),  as receiver  for the            failed   Capitol   Bank  and   Trust   Company,  of   Boston,            Massachusetts (the Bank), for want of jurisdiction.                                      Background                                      Background                                      __________                 In  November  1990,  appellant  purchased  an  apartment            building in Providence,  Rhode Island from  the Bank.   Under            the  sales agreement, the Bank undertook to provide financing            for both the  acquisition and the renovation  of the complex.            At the closing,  appellant signed a promissory  note, secured            by a mortgage on  the property.  In  December 1990, the  Bank            failed.  The FDIC was appointed receiver.   In June 1991, the            FDIC,  as receiver,  disaffirmed  the  original agreement  to            finance renovations.                 In due course, appellant filed a proof of claim with the            FDIC.   The proof was not acted upon within the required 180-            day  period, see 12 U.S.C.   1821(d)(5)(A)(i).  Nevertheless,                         ___            the  FDIC  notified  appellant  on March  4,  1992,  that  it            intended to  foreclose.  On March 17,  appellant responded by            filing this action in a Rhode Island  state court.  He sought            to enjoin the FDIC from proceeding with the foreclosure, and,            moreover, to reform  or cancel the sales agreement, note, and            mortgage (based on an asserted mutual mistake).                                         -2-                 On  March 30,  1992, the  FDIC removed  the case  to the            United  States District Court  for the District  of Columbia.            See  12  U.S.C.    1819(b)(2)(B)  (giving  FDIC  authority to            ___            remove  action "to  the  appropriate United  States  district            court")  & 12  U.S.C.    1821(d)(6)(A)  (giving "district  or            territorial  court  of  the United  States  for  the district            within which the depository  institution's principal place of            business is located or  the United States District Court  for            the  District  of  Columbia"  jurisdiction   over  any  claim            disallowed by  the FDIC).   On  April 2,  the  FDIC moved  to            transfer the case to the United States District Court for the            District  of Rhode Island  "[f]or the convenience  of parties            and witnesses."   28  U.S.C.   1404(a).   The  district court            transferred   the  case  on  April  23,  1992.    Appellant's            administrative claim was finally denied on June 9, 1992.                 Once the  case  had returned  north, the  FDIC moved  to            dismiss  for  lack  of subject  matter  jurisdiction  and for            failure to state a claim  upon which relief could be granted.            At the same time, the FDIC also argued that appellant's claim            for injunctive  relief was  barred by  12 U.S.C.    1821(j).1                                            ____________________            1.  Subsection 1821(j) provides, in part:                      Except  as provided  in this  section, no                      court may take any  action, except at the                      request of  the  Board  of  Directors  by                      regulation  or  order,   to  restrain  or                                               ________________                      affect   the   exercise  of   powers   or                      _________________________________________                      functions   of  the   Corporation  as   a                      _________                          ______                      conservator or a receiver.                      _________________________                                         -3-            The  district   court  dismissed   the  case   for  want   of            jurisdiction.  This appeal followed.2                                       Discussion                                      Discussion                                      __________                 A  "district court lacks jurisdiction to enjoin the FDIC            when the FDIC  is acting pursuant to its  statutory powers as            receiver."   Telematics Int'l,  Inc. v. NEMLC  Leasing Corp.,                         ______________________     ___________________            967  F.2d 703,  707 (1st  Cir. 1992);  see  also 12  U.S.C.                                                     ___  ____            1821(j).  The FDIC has the  power as receiver to foreclose on            the property  of a  debtor.  See  12 U.S.C.    1821(d)(B)(ii)                                         ___            (giving  FDIC power to "collect all obligations and money due            the [failed]  institution").   Thus, the  district court  was            without jurisdiction to grant the injunctive relief appellant            seeks.   See 281-300 Joint Venture v.  Onion, 938 F.2d 35, 39                     ___ _____________________     _____            (5th Cir. 1991) (injunction against receiver's foreclosure of            appellants'  property barred by   1821(j)), cert. denied, 112                                                        ____  ______            S.Ct. 933 (1992).                                            ____________________            12 U.S.C.    1821(j) (emphasis  supplied).  According  to the            FDIC, none  of the statutory exceptions  authorize injunctive            relief of the kind sought by appellant.            2.  The  district judge determined  that the suit  was barred            both because  the court  lacked jurisdiction  pursuant to  12            U.S.C.    1821(d)(6)(A) and  because it  had no  jurisdiction            over  a case removed from a state  court which itself did not            have jurisdiction over the original  case.  While it was once            settled law that  a federal court's removal  jurisdiction was            derived  from the state  court's jurisdiction, this  rule has            been abolished by statute.   See 28 U.S.C.    1441(e).  Thus,                                         ___            we address  only the effect  of 12 U.S.C.    1821(d)(6)(A) on            the district court's jurisdiction.                                         -4-                 Appellant's  claims  for  equitable  reformation  and/or            cancellation of  the contract fare  no better.   These claims            lie  in  the  maw  of  the statute,  for,  in  the  statutory            parlance, the plaintiff's complaint "seeks a determination of            rights with  respect  to  []  the assets  of  a[]  depository            institution  for  which  the Corporation  has  been appointed            receiver."   12 U.S.C.    1821(d)(13)(D).  By its  terms, the            statute limits federal court jurisdiction over such claims to            those  instances  "otherwise  provided"  in section  1821(d).            Id.; see also Marquis v. Federal Deposit Ins. Corp., 965 F.2d            __   ___ ____ _______    _________________________            1148, 1153 (1st Cir. 1992).  We  understand this to mean that            the federal  courts are  barred  from asserting  jurisdiction            over  claims   against  the   assets  of  failed   depository            institutions except as expressly  or impliedly permitted, see                                                                      ___            Marquis, 965 F.2d  at 1153 (suggesting  that, in addition  to            _______            its  express  grants of  jurisdiction,  section  1821(d) also            implies   the    existence   of    jurisdiction   in    other            circumstances),  by  virtue  of  the  various  subsections of            section 1821(d).  See Resolution Trust Corp. v. J.F. Assocs.,                              ___ _____________________     ___________            813 F. Supp. 951, 954 (N.D.N.Y.  1993); see also Landmark Land                                                   ___ ____ _____________            Co.  v. Office  of Thrift Supervision,  948 F.2d  910, 912-13            __      _____________________________            (5th Cir.  1991) (interpreting similarly worded  provision in            12 U.S.C.   1818(i)(1) as limiting jurisdiction).  We further            understand the specific  jurisdictional provision of  section            1821(d)(13)(D)   to    control   over   the    more   general                                         -5-            jurisdictional  grant found  in 12  U.S.C.    1819(b)(2)(A).3            See Gozlon-Peretz v. United States,  498 U.S. 395, 407 (1991)            ___ _____________    _____________            ("[a]  specific provision controls  over one of  more general            application") (citing  Crawford Fitting Co.  v. J.T. Gibbons,                                   ___________________      _____________            Inc., 482 U.S. 437, 445 (1987)).              ___                 Appellant  seeks to  find  safe  haven  in  the  statute            itself:  after all,  section 1821(d)(6)(A)  expressly confers            jurisdiction  upon federal  courts to  entertain suits  based            upon disallowed claims.  The district court did not buy these            wares.  Rather,  Judge Lagueux, adopting a position  urged by            the  FDIC  below,  ruled  that  the  only  courts  which  had            jurisdiction  over  appellant's   claims  were  the   federal            district  court  for  the  district  where  the  failed  bank            maintained   its   principal   place   of   business   (here,            Massachusetts)  and  the  federal   district  court  for  the            District  of  Columbia,  see  12   U.S.C.     1821(d)(6)(A).4                                     ___                                            ____________________            3.  Subsection 1819(b)(2)(A) provides, in part, that:                 all  suits .  . . to  which the  [FDIC] is  a party                 shall  be deemed  to  arise under  the laws  of the                 United States.            12 U.S.C.   1819(b)(2)(A).            4.  The statute provides,  in relevant part, that  a claimant            may:                 file  suit on  such claim  (or  continue an  action                 commenced before  the appointment of  the receiver)                 in the district  court or territorial court  of the                 United  States for  the district  within  which the                 depository   institution's   principal   place   of                 business is  located or the United  States District                                         -6-            Lloyd's  appeal attacks  this  ruling.    And  appellant  has            acquired a rather surprising ally:   reversing its field, the            FDIC  now  contends  that  section  1821(d)(6)(A)  is  not  a            jurisdictional limitation,  but is instead  a venue provision            that can  be waived (and  which the  FDIC has waived  in this            instance).   We  think  the  FDIC was  right  the first  time            around.                 For   one  thing,   the   plain   language  of   section            1821(d)(6)(A)  indicates  that it  is a  jurisdictional grant            limited  to the federal district court for the district where            the institution has  its principal place of  business and the            United  States District Court  for the District  of Columbia.            See  id.  (providing  that  either  such  court  "shall  have            ___  __            jurisdiction to hear such claim").  Accord J.F.  Assocs., 813                                                ______ ____________            F.Supp. at  958.  For  another thing, while the  reasoning of            the only  court  that, to  our knowledge,  has found  section            1821(d)(6)(A) to be a venue provision supports the FDIC's new            position, the reasoning is not persuasive--and the holding is            not  inconsistent, simpliciter, with reading the section as a                               ___________            jurisdictional  provision.    In Vinton  v.  Trustbank, Sav.,                                             ______      ________________            F.S.B., 798  F. Supp. 1055 (D.Del. 1992), the  court held that            _____            section  1821(d)(6)(A)   was  not   a  grant   of  "exclusive                                            ____________________                 Court  for the District of Columbia (and such court                 shall have jurisdiction to hear such claim).            12 U.S.C.   1821(d)(6)(A).                                         -7-            jurisdiction" to the two listed  courts and did not deprive a            third  court  of   jurisdiction  which   it  had   previously            obtained.5   Id.  at 1065. But  section 1821(d)(6)(A)  can be                         __            read  as a  grant of  jurisdiction to  two designated  courts            without  being read as a completely  exclusive grant.  Accord                                                                   ______            J.F.  Assocs., 813  F. Supp.  at  955.   As  we interpret  it,            ____________            section 1821(d)(6)(A) does not extend jurisdiction beyond the            two  specified courts--but,  by the  same token, it  does not            deprive a court  of jurisdiction  where, as  in Vinton,  that                                                            ______            jurisdiction   has   a    source   independent   of   section            1821(d)(6)(A).  See Marquis, 965 F.2d at 1152-54 (determining                            ___ _______            that  subsections  of  section  1821(d)  other  than  section            1821(d)(6)(A) permit federal courts to retain jurisdiction in            circumstances  where   a   bank's   failure   postdates   the            institution of the action).                   In the instant  case, section 1821(d)(6)(A) provides  no            basis  for jurisdiction in  the United States  District Court            for the District of Rhode  Island.  Nor has appellant  or the            FDIC  indicated any source of federal jurisdiction in section            1821(d) other than section 1821(d)(6)(A).  Consequently, even            though,  viewed simply  from the  perspective  of policy,  it            might seem sensible  to allow for  suits of  this sort to  be                                            ____________________            5.  In  Vinton,  the  United States  District  Court  for the                    ______            District  of Delaware had obtained jurisdiction over the case            before   the  Resolution  Trust   Corporation  took  over  as            receiver.                                         -8-            tried in  the district  where the  transactions occurred  and            where  the court  is  likely  to be  most  familiar with  any            applicable local law, the statutory language, especially that            of    1821(d)(13)(D), compels  us, absent  a more  persuasive            argument to  the contrary, to  find that  the district  court            appropriately  determined  that  it   lacked  subject  matter            jurisdiction over Lloyd's suit.   See Massachusetts Financial                                              ___ _______________________            Services, Inc. v. Securities  Investor Protection, Corp., 545            _____________     _____________________________________            F.2d 754, 756 (1st  Cir. 1976), ("a statute's  plain language            is  the primary indicator of its meaning"), cert. denied, 431                                                        ____  ______            U.S. 904 (1977).6                 The  normal remedy in  these circumstances would  be for            the  district court to dismiss this case  (as it did).  Here,            however,  a dismissal  seems unfair  since  it would  deprive            Lloyd,  who  is in  effect  a  victim  of  the  FDIC-inspired            transfer to  the  District Court  for the  District of  Rhode            Island,  of  any   means  of  redress.    See   12  U.S.C.                                                         ___            1819(d)(6)(B)   (unless    claimant   requests    review   of            disallowance  of  claim  within  60  days  of  determination,            "disallowance shall be final, and  the claimant shall have no                                            ____________________            6.  We note that, liberally  construed, appellant's complaint            also invokes  12 U.S.C.    1821(e), a statute  which provides            that the FDIC may repudiate contracts entered into before its            appointment as receiver, but affords an injured party a right            to compensatory relief.  See, e.g., Howell v. Federal Deposit                                     ___  ___   ______    _______________            Ins.  Corp., 986 F.2d  569, 571 (1st  Cir. 1993).   We do not            __________            decide  whether the  district court  would  have jurisdiction            under this section because appellant has explicitly disavowed            any intention of pursuing a breach of contract claim.                                         -9-            further  rights or  remedies with  respect  to such  claim").            Since the  transferor court  was not  empowered to  order the            transfer  of  this action  to  a court  which  lacked subject            matter   jurisdiction  over  it,  see  28  U.S.C.     1404(a)                                              ___            (transfer may only  be to a district where  the action "might            have been  brought"),  we  think it  more  prudent  that  the            district  court retransfer this  action to the  United States            District  Court for  the District  of Columbia on  the ground            that the transfer was  improvidently granted.  See  Turner v.                                                           ___  ______            Kelley,  411 F. Supp. 1331 (D. Kan. 1976) (retransferring case            ______            to   transferor  court   because   transferee  court   lacked            jurisdiction under  5 U.S.C.   552(a)); Majewski  v. New York                                                    ________     ________            C. R. Co., 227 F. Supp.  950 (W.D. Mich. 1964) (retransferring            ________            case  to transferor  court  because  transferee court  lacked            jurisdiction).                 The  dismissal is therefore  vacated for the  purpose of                                              _______            allowing  the district  court to  enter  such an  order.   No            costs.                                         -10-