['ALKASABI v. WASHINGTON MUTUAL BANK, F.A.']
31 F. Supp. 3d 101
D.D.C.2014Background
- Plaintiffs Osama A. Alkasabi and Nadia Haddada bought two La Jolla condominiums financed by Washington Mutual (WAMU) in 2005 and 2006 and claim they were induced to close by representations that Certificates of Occupancy (COs) existed when they did not.
- WAMU failed and the FDIC was appointed receiver on September 25, 2008; the FDIC set a statutory Claims Bar Date of December 30, 2008 and published notice.
- Plaintiffs filed an administrative claim with the FDIC on August 22, 2012 (almost four years after the Claims Bar Date); the FDIC disallowed it as untimely on October 16, 2012.
- Plaintiffs filed this suit in federal court within 60 days of disallowance, alleging negligent misrepresentation/fraud and seeking declaratory relief that the FDIC (and Chase) assumed WAMU’s liabilities.
- The FDIC moved to dismiss for lack of subject-matter jurisdiction (FIRREA administrative-exhaustion/Claims Bar Date rules) and failure to state a claim; the court considered FIRREA’s jurisdictional exhaustion requirements dispositive.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FIRREA’s administrative-claims process is jurisdictional | Plaintiffs accept they must file administratively but say they satisfied the late-filed exception | FDIC: FIRREA makes administrative filing jurisdictional and late claims are disallowed absent the narrow statutory exception | Court: FIRREA exhaustion is jurisdictional; plaintiffs failed to meet exception, so court lacks jurisdiction |
| Whether plaintiffs qualify for FIRREA’s late-filed-claim exception (lack of notice of receiver appointment) | Plaintiffs: they did not receive actual/mailed notice and thus qualify for the statutory exception | FDIC: publication and inquiry notice sufficed; plaintiffs have not shown they lacked notice of FDIC appointment | Court: plaintiffs failed to show lack of notice; publication/inquiry notice adequate; exception does not apply |
| Whether plaintiffs’ claim accrued after the Claims Bar Date under the discovery rule | Plaintiffs: injury did not accrue until related state-court rulings in 2012, so claim arose after the Bar Date | FDIC: alleged injury (absence of COs) was ascertainable at closing; plaintiffs did not exercise due diligence | Court: discovery rule inapplicable—plaintiffs could have discovered the absence of COs earlier with minimal diligence |
| Whether equitable tolling saves the late administrative filing | Plaintiffs: assert equitable tolling should apply | FDIC: no extraordinary diligence shown to warrant tolling | Court: even if tolling were available, plaintiffs did not show the due diligence required; tolling denied |
Key Cases Cited
- Westberg v. Federal Deposit Ins. Corp., 741 F.3d 1301 (D.C. Cir. 2014) (FIRREA administrative filing is a jurisdictional exhaustion requirement)
- Freeman v. Federal Deposit Ins. Corp., 56 F.3d 1394 (D.C. Cir. 1995) (interpreting the late-filed-claim statutory exception narrowly)
- American Nat'l Ins. Co. v. Federal Deposit Ins. Corp., 642 F.3d 1137 (D.C. Cir. 2011) (describing FIRREA’s administrative-claims procedure and judicial-review framework)
- Heno v. Federal Deposit Ins. Corp., 20 F.3d 1204 (1st Cir. 1994) (discussing accrual and late-filed-claim exception in receiver context)
- Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306 (U.S. 1950) (publication notice suffices for unknown beneficiaries under due process)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (U.S. 1992) (plaintiff bears burden to establish jurisdictional facts)