410 F. Supp. 2d 670

VILLAGE OF OAKWOOD, et al., Plaintiffs v. The STATE BANK AND TRUST COMPANY, Defendant.

No. 3:05CV7173.

United States District Court, N.D. Ohio, Western Division.

Jan. 18, 2006.

*671John C. Deal, Kisor & Winkler LLC, Columbus, OH, for Plaintiffs.

James H. O’Doherty, Stephen A. Rothschild, Shumaker, Loop & Kendrick, Toledo, OH, for Defendant.

ORDER

CARR, Chief Judge.

This is a suit by former depositors of the Oakwood Deposit Bank Company (Oak-wood Bank), which was placed into receivership by the Federal Deposit Insurance Corporation (FDIC). The FDIC transferred the assets of the Oakwood Bank to the defendant State Bank and Trust Company (State Bank). The plaintiffs’ deposits with Oakwood Bank were not fully insured.

Plaintiffs claim that State Bank is liable for the amount of the uninsured deposits. They allege State bank is liable: 1) as a successor to the FDIC for alleged breaches by the FDIC of a fiduciary relationship; 2) for aiding and abetting the FDIC’s alleged breaches of fiduciary duty; 3) as a constructive trustee; and 4) for a breach of contract.

Plaintiffs filed suit in state court. The FDIC intervened and removed to this court. Plaintiffs’ motion to remand, though initially granted, was, on reconsideration, overruled.

Pending is the FDIC’s motion for summary judgment. For the following reasons, the motion for summary judgment will be granted.

Background

As receiver, the FDIC entered into a purchase and assumption agreement with State Bank to assume certain insured deposits and liabilities of the failed Oakwood Bank.

The FDIC classified plaintiffs as uninsured depositors of Oakwood Bank. Plaintiffs are unhappy with the FDIC’s claim distributions to uninsured claimants. In short, plaintiffs allege the FDIC wrongfully treated unrecorded funds as insured deposits, thereby decreasing the payment plaintiffs received for their uninsured deposits.

Plaintiffs did not sue the FDIC. Instead, plaintiffs brought suit against State Bank.

*672Discussion

The FDIC argues plaintiffs’ claims fail because: 1) § 1821(d)(13)(D)(ii) of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), 12 U.S.C. § 1821(d), limits judicial review of plaintiffs’ claims; and 2) plaintiffs fail to state a claim for which relief can be granted. In particular, the FDIC argues plaintiffs failed to comply with FIRREA’s mandated judicial review timeline in § 1821(d)(6) and this failure bars its ability to seek judicial review in this court.

Plaintiffs contend § 1821 (d) (13) (D) (ii) does not bar their state law claims against State Bank. Plaintiffs do not argue that they complied with the § 1821(d)(6) provisions for judicial review; rather they contend this section does not apply to this action.1

Congress enacted FIRREA to enable the FDIC to act as a receiver “to efficiently and expeditiously wind up the affairs” of failed financial institutions. In re Lewis, 398 F.3d 735, 740 (6th Cir.2005). FIRREA governs the FDIC’s powers and duties as a receiver. 12 U.S.C. § 1821(d).

Pursuant to FIRREA, the FDIC may serve as receiver for failed banks and accept or reject claims made against the assets of the institution, paying the accepted claims. 12 U.S.C. § 1821(d). Section 1821(d)(6) of FIRREA governs appeals of the FDIC’s actions as receiver. It sets a time period, either sixty days after the 180 day claim determination period or sixty days after a claim is disallowed, and determines the venue, and prescribes when a claimant may request agency or judicial review.2 12 U.S.C. § 1821(d)(6). Section 1821(d)(13)(D) bars a court’s jurisdiction over most claims unless a claimant follows these venue and time provisions. 12 U.S.C. § 1821(d)(13)(D).

At issue in this case is whether § 1821(d)(13)(D)(ii) governs plaintiffs’ causes of action. That statute provides “[ejxcept as otherwise provided in this subsection, no court shall have jurisdiction over ... (ii) any claim relating to any act or omission of such institution or the Cor*673poration [the FDIC] as receiver.” 12 U.S.C. § 1821(d)(13)(D)(ii) (emphasis added).

Plaintiffs contend this section 'does not include their claims. In support of their argument, plaintiffs cite cases that address the interplay between § 1821(d)(13)(D) and § 1821(d)(6). The language of § 1821(d)(6)' has raised debate as to whether it only applies to claims against the FDIC for actions “against a depository institution for which the Corporation is receiver” or applies generally to all claims referred to in § 1821(d)(13)(D). Auction Co. v. FDIC, 141 F.3d 1198, 1201 (D.C.Cir.1998).

The Sixth Circuit, however, has recognized that all claims referred to in § 1821(d)(13)(D) are subject to § 1821(d)’s exhaustion requirements. In re Lewis, 398 F.3d at 741 (quoting Freeman v. FDIC, 56 F.3d 1394, 1400-01 (D.C.Cir.1995)).3 Thus, a plaintiff bringing a suit relating to the FDIC’s actions as receiver for a failed bank must comply with the time and venue requirements set forth in § 1821(d)(6). • Id.; 12 U.S.C. § 1821(d)(13)(D)(ii). Otherwise FIRREA bars jurisdiction.

Plaintiffs did not bring this action within the timeline provided for in § 1821(d)(6).4 Thus, § 1821(d)(13)(D)(ii) bars any of plaintiffs’ claims against State Bank that relate to the acts of the FDIC as receiver for Oakwood Bank.

A review of the plaintiffs’ complaint shows that all of plaintiffs’ claims relate to the FDIC’s actions as receiver for Oak-wood Bank. Plaintiffs’ first three causes of action stem from an alleged breach of a fiduciary duty by the FDIC while acting as receiver for Oakwood Bank. Plaintiffs’ final cause of action for breach of contract arises from the FDIC’s actions as receiver in transferring insured deposit accounts to State Bank. Thus, § 1821(d)(13)(D)(ii) bars this court’s jurisdiction over the action..

Accordingly, the FDIC’s motion for summary judgment is granted.

Conclusion

For the foregoing reasons, it is therefore,

ORDERED that the FDIC’s motion .for summary judgment be, and the same hereby is, granted.

So ordered.

Village of Oakwood v. State Bank & Trust Co.
410 F. Supp. 2d 670

Case Details

Name
Village of Oakwood v. State Bank & Trust Co.
Decision Date
Jan 18, 2006
Citations

410 F. Supp. 2d 670

Jurisdiction
United States

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