Addair, et al. v. Federal Deposit Insurance Corporation
Filing
17
MEMORANDUM OPINION AND ORDER granting defendant FDIC's 13 MOTION to Dismiss. Signed by Senior Judge David A. Faber on 7/14/2011. (cc: counsel of record) (arb)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
AT BLUEFIELD
PERRY ADDAIR and
SANDRA ADDAIR,
Plaintiffs,
v.
CIVIL ACTION NO. 1:08-1428
FEDERAL DEPOSIT INSURANCE
CORPORATION, as Receiver for
Ameribank, Inc.,
Defendant.
MEMORANDUM OPINION AND ORDER
Pending before the court is the motion to dismiss filed by
defendant Federal Deposit Insurance Corporation ("FDIC"), as
Receiver for Ameribank, Inc.
(Doc. # 13).
For reasons discussed
more fully below, that motion is GRANTED.
Background
This civil action arises out of Ameribank's handling of
plaintiffs' application for a debt consolidation loan from
Ameribank.
See Complaint generally.
or about September 25, 2003,
According to plaintiffs, on
Ameribank told them their loan
application was approved in the amount of $12,000.00 and that
they would have "immediate access" to the loan proceeds.
¶¶ 7-8.
Id. at
Relying on the assurances of Ameribank regarding the
approval of their loan, plaintiffs began writing checks on their
account believing that the loan had been disbursed.
Id. at ¶ 9.
Thereafter, on or about October 11, 2003, Ameribank informed
plaintiffs that their application had actually been denied.
Id.
at ¶ 10.
The checks that plaintiffs had written in reliance on
the loan proceeds were returned for insufficient funds.
¶¶ 11-12.
Id. at
Because the checks were not honored, plaintiffs
"incurred substantial fees from Ameribank and payees on multiple
checks, as well as criminal prosecution for worthless check
criminal charges."
Id. at ¶ 12.
Thereafter, on July 20, 2007, plaintiffs filed the instant
complaint in the Circuit Court of McDowell County.
The Complaint
alleges causes of action against Ameribank for breach of
contract, violation of the West Virginia Consumer Protection Act,
and fraud.
Id. at ¶¶ 14-25.
On September 19, 2008, the Office of Thrift Supervision
closed Ameribank and appointed the FDIC as Receiver.
Pursuant to
12 U.S.C. § 1821(d)(3)(B)(i) and (ii), the FDIC published notice
of its appointment to all creditors of Ameribank in various
publications, including The Welch News, a newspaper in McDowell
County, West Virginia, on September 26, 2008; October 27, 2008;
and November 26, 2008.
Dismiss.
See Exhibit A to FDIC's Motion to
These notices also advise creditors of Ameribank to
submit all claims to the Receiver by the Claims Bar Date of
December 26, 2008.
Id.
On December 17, 2008, the FDIC filed a Motion to Substitute,
in the McDowell County Circuit Court, seeking to substitute the
FDIC as Receiver for Ameribank.
On that same day, the FDIC
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removed the case to federal court.
On January 20, 2009, the FDIC
moved to stay this action for a period of 90 days, pursuant to
the statutory stay provisions of 12 U.S.C. § 1821(d)(12)(A)(ii).
That motion was granted on May 7, 2009, and the case was stayed
until June 3, 2009.
During this stay, on May 14, 2009, the FDIC mailed a Notice
to Discovered Creditor and Proof of Claim Form to plaintiffs,
care of their attorney.
Dismiss.
See Exhibit B to FDIC's Motion to
In the Notice to Discovered Creditor, the FDIC states
that it published notice in The Welch News and The Times Leader
that any claims against Ameribank must be filed with the FDIC by
the Claims Bar Date of December 26, 2008.
The Notice further
stated, however, that if a Claimant could satisfy certain
statutory exceptions contained in 12 U.S.C. § 1821(d)(5)(C), the
Receiver would consider a late-filed claim.
Id.
Plaintiffs were
directed to "[p]rovide supporting documentation both regarding
your claim and your lack of knowledge of the appointment of the
Receiver. . . ."
Id.
The notice gave plaintiffs a deadline of
August 17, 2009, to file a claim.
Id.
On or about August 17,
2009, plaintiffs returned the Proof of Claim form to the
Receiver.
See Exhibit C to FDIC's Motion to Dismiss.
The Proof
of Claim submitted by plaintiffs provided no supporting
documentation for their claim other than providing a copy of the
Complaint filed in this case.
Id.
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It also did not indicate, by
evidence or otherwise, that plaintiffs failed to receive notice
of the appointment of the Receiver.
Id.
In its motion to dismiss, the FDIC argues that the court
lacks subject matter jurisdiction over plaintiffs' complaint
based on plaintiffs' failure to pursue its administrative
remedies.
Plaintiffs did not file a response to the motion to
dismiss.
Analysis
"[The Financial Institutions Reform, Recovery and
Enforcement Act ("FIRREA")] was enacted in 1989 as an emergency
measure to enable the RTC and the Federal Deposit Insurance
Corporation ("FDIC") to resolve and liquidate expeditiously the
hundreds of failed financial institutions throughout the
country."
Tillman v. Resolution Trust Corp., 37 F.3d 1032, 1035
(4th Cir. 1994).
Section 1821(d) of FIRREA sets forth an
administrative process for the receiver of a failed financial
institution to settle claims against the institution and
liquidate its assets."
12 U.S.C. § 1821(d); Elmco Properties,
Inc. v. Second National Federal Savings Assoc., 94 F.3d 914, 919
(4th Cir. 1996); see also
Brady Development Co., Inc. v.
Resolution Trust Corp., 14 F.3d 998, 1002 (4th Cir. 1994) (FIRREA
"sets forth a detailed series of rules under which all claims
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involving an insolvent institution are received and handled.")
(citing 12 U.S.C. § 1821(d)).
Upon becoming receiver, the RTC [or FDIC] must promptly
publish notice to the institution's creditors that they
must present their claims before a certain date - - the
"bar date" - - which is to be at least ninety days
after publication of the notice. § 1821(d)(3)(B)(i).
Furthermore, the RTC must mail a similar notice to (1)
creditors appearing on the institution's books, and (2)
claimants not appearing on the books but whose names
and addresses the RTC later discovers.
Elmco Properties, 94 F.3d at 919.
"Congress required persons
making claims against a failed financial institution or seeking
to adjudicate rights against them to present their claims first
to the receiver for resolution.
More specifically, under 12
U.S.C. § 1821(d), a claimant must present his claim to the
receiver for an initial determination of whether the claim should
be allowed within 90 days of the publication of notice by the
receiver."
Tillman v. Resolution Trust Corp., 37 F.3d 1032, 1035
(4th Cir. 1994).
After a claim is submitted, the receiver has 180 days from
the date of filing to allow or disallow the claim.
§ 1821(d)(5)(A)(i).
21 U.S.C.
If the FDIC disallows the claim or fails to
make a determination within 180 days, the claimant may seek
judicial review.
Elmco Properties, 94 F.3d at 919.
But, unless a claim is first presented to the RTC for
resolution, no court has jurisdiction over it. These
provisions combine to create an exhaustion requirement
that, [the Fourth Circuit has] concluded, is "absolute
and unwaivable." Importantly, FIRREA does not allow
waiver of the exhaustion requirement even for claimants
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to whom the [FDIC] failed to mail the required notice
of the claims process and bar date.
Id.
The Fourth Circuit has "held that a plaintiff's failure to
exhaust the administrative process deprives the courts of subject
matter jurisdiction."
Tillman v. Resolution Trust Corp., 37 F.3d
1032, 1035 (4th Cir. 1994).
As noted above, claims filed after the claims bar date
"shall be disallowed and such disallowance shall be final."
There is, however, one exception.
A claim filed after the claims
bar date "may be considered by the receiver if -- (I) the
claimant did not receive notice of the appointment of receiver in
time to file such claim before such date; and (II) such claim is
filed in time to permit payment of such claim."
12 U.S.C. §
1821(d)(5)(C)(ii).
One exception exists to the rule presented in 12 U.S.C.
§ 1821(d)(5)(C)(i). Section 1821(d)(5)(C)(ii) provides
that if a claimant establishes that she did not receive
notice of the appointment of the receiver in time to
file her claim before the bar date, a receiver may
consider her late-filed claim. [Claimants] have never
alleged that they were not aware of the appointment of
a receiver; they alleged in their filing of claim with
the FDIC only that they had no notice of a time bar to
their filing a claim . . . .
This contention does not
suffice:
By its terms . . . the exception [in §
1821(d)(5)(C)(ii) ] only applies to claimants
who do not receive notice of the fact of the
appointment of a receiver. The exception
makes no reference to claimants who are aware
of the appointment of a receiver but who do
not receive notice of the filing deadline.
Therefore, a claimant's assertion that he or
she was not made aware of the filing
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deadline, as distinct from an assertion that
the claimant was not aware of the fact of
receivership, does not bring the claimant
within the exception.
FDIC v. Atchison & Keller, 913 F. Supp. 19, 25 (D.D.C. 1996)
(quoting McLaughlin v. FDIC, 796 F. Supp. 47, 49 (D. Mass. 1992)
(internal citations omitted)).
Furthermore, "[t]he discretion
conferred by § 1821(d)(5)(C)(ii) is narrowly drawn, and the FDIC
loses this discretion after the claimant has notice of its status
as receiver."
Paul v. FDIC, 91 F.3d 110, 112 (11th Cir. 1996).
The claim submitted by plaintiffs herein was filed after the
claims bar date.
Therefore, the FDIC may consider the claim only
if plaintiffs did not receive notice of the appointment of the
FDIC as receiver before the claims before date.
Plaintiffs do
not contend that they did not receive such notice nor is there
any evidence in the record to suggest they did not.
Accordingly,
the FDIC's motion to dismiss must be GRANTED.
Conclusion
Because the plaintiffs had notice of the FDIC's appointment
as Receiver of Ameribank prior to the Claims Bar Date and failed
to file a claim before expiration of that date, this court is
without jurisdiction to consider plaintiffs' claims against the
FDIC as Receiver for Ameribank.
For this reason, the motion to
dismiss is GRANTED.
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The Clerk is requested to send a copy of this Memorandum
Opinion and Order to counsel of record.
IT IS SO ORDERED this 14th day of July, 2011.
ENTER:
David A. Faber
Senior United States District Judge
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