919 F.3d 916
5th Cir.2019Background
- The FDIC brought two administrative enforcement actions (Oct–Nov 2013) against Bank of Louisiana and three directors alleging Regulation O violations, unsafe/unsound practices, and multiple federal statute violations; ALJ recommended penalties and the FDIC Board issued final orders.
- After the Board’s final orders (2014 and 2016), the Bank and its directors petitioned the Fifth Circuit for review of those agency orders; the Bank also filed a separate suit in federal district court (Aug 2016) asserting constitutional claims (age discrimination, due‑process, Appointments Clause) arising from the same enforcement proceedings.
- The Bank abandoned requests for injunctive relief and damages after the Board’s second final order, leaving only a declaratory‑judgment claim in district court.
- The FDIC moved to dismiss for lack of subject‑matter jurisdiction, relying on 12 U.S.C. § 1818’s exclusive appellate review scheme and the § 1818(i) jurisdictional bar; the district court dismissed without prejudice, and the Bank appealed.
- The Fifth Circuit reviewed de novo and focused on whether Congress implicitly or explicitly precluded district court jurisdiction under § 1818, applying the Thunder Basin/Elgin framework for implicit preclusion.
- The Fifth Circuit affirmed dismissal: it found § 1818(i)’s text and the statutory review scheme demonstrate congressional intent to channel review to the courts of appeals and concluded the Thunder Basin factors favor preclusion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether district court has jurisdiction over Bank’s constitutional claims arising from FDIC enforcement proceedings | Bank: §1818 does not bar district court because Thunder Basin factors show Congress did not intend to preclude district jurisdiction | FDIC: §1818(h) vests exclusive review in courts of appeals and §1818(i) expressly bars district‑court relief | Held: District court lacked jurisdiction; exclusive review under §1818 governs (affirmed) |
| Meaningful judicial review (Thunder Basin factor 1) — would preclusion foreclose meaningful review? | Bank: Agency limited discovery and ALJ curtailed fact development, so circuit review would not be meaningful | FDIC: Circuit review of final order is meaningful; ALJ/Board addressed constitutional claims; remand/remedies available | Held: Meaningful review exists via agency process and courts of appeals; factor favors preclusion |
| Wholly collateral (Thunder Basin factor 2) — are Bank’s claims collateral to §1818 scheme? | Bank: Claims target unconstitutional motives and process, not merits of FDIC order, so they are collateral | FDIC: Claims arise from and were litigated within the enforcement proceedings, so they are intertwined with the scheme | Held: Claims are inextricably tied to the enforcement proceedings; not wholly collateral; factor favors preclusion |
| Agency expertise (Thunder Basin factor 3) — are claims outside FDIC expertise? | Bank: Constitutional questions (Appointments Clause, discrimination) lie beyond FDIC expertise | FDIC: FDIC has expertise to resolve threshold/statutory issues and facts; could moot or inform constitutional issues; ALJ/Board applied expertise here | Held: FDIC expertise was relevant and applied; factor favors preclusion |
Key Cases Cited
- Bd. of Governors v. MCorp Fin., 502 U.S. 32 (1991) (discussing limits on district court intervention in banking agency enforcement)
- Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (1994) (framework for when Congress channels review to courts of appeals)
- Elgin v. Dep’t of Treasury, 567 U.S. 1 (2012) (applying Thunder Basin factors; agencies can address threshold issues and provide meaningful review)
- Free Enter. Fund v. PCAOB, 561 U.S. 477 (2010) (analysis of exclusive review and when preclusion is inappropriate)
- Groos Nat. Bank v. Comptroller of Currency, 573 F.2d 889 (5th Cir. 1978) (section 1818 declaratory relief is encompassed by injunction prohibition)
- Rhoades v. Casey, 196 F.3d 592 (5th Cir. 1999) (describing § 1818 as a comprehensive system for judicial review)
- Jarkesy v. SEC, 803 F.3d 9 (D.C. Cir. 2015) (applying Thunder Basin/Elgin framework to SEC enforcement scheme)