Benson v. JPMorgan Chase Bank, N.A.
673 F.3d 1207
| 9th Cir. | 2012Background
- Plaintiffs allege WaMu aided and abetted the Millennium Ponzi scheme and JPMorgan, as WaMu's successor, is liable after acquiring WaMu’s assets post-FDIC receivership under FIRREA.
- WaMu allegedly provided banking services (including CMT and RDC) to Nevada LLCs linked to the Millennium Bank, despite knowledge of the fraud.
- FDIC seized WaMu in September 2008; JPMorgan purchased WaMu’s assets and liabilities shortly after, under a purchase and assumption agreement.
- Plaintiffs asserted claims for aiding and abetting fraud, aiding and abetting conversion, banking-law violations, and related conspiracy theories, seeking class certification.
- The district court dismissed the FIRREA-related claims for lack of exhaustion, and denied leave to amend via a Rule 60(b) motion.
- Ninth Circuit affirmed dismissal, holding FIRREA’s exhaustion applies to claims against purchasing banks where the claim relates to acts of the failed bank; post-purchase independent claims are not automatically barred but must be adequately pled.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does FIRREA require exhaustion for claims against a purchasing bank based on the failed bank’s acts? | FIRREA bar targets acts of the failed bank or FDIC as receiver, not third-party purchasers. | FIRREA § 1821(d)(13)(D)(ii) bars claims relating to acts of the failed bank or FDIC even against purchasing banks. | Yes; the bar applies to claims functionally tied to the failed bank’s acts. |
| Do post-purchase independent acts by the purchasing bank fall outside FIRREA’s bar? | Purchasing bank’s independent conduct can support claims not barred by FIRREA. | All claims relate to WaMu’s acts; FIRREA bars them regardless of purchaser. | Post-purchase independent claims not automatically barred, but plaintiffs failed adequately to plead such claims here. |
| Should the district court have granted leave to amend after Rule 60(b) denial? | Amendment should be allowed to plead JPMorgan-specific theories. | Rule 60(b) arguments were properly denied; Lindauer bars post-judgment amendment. | Amendment not warranted; Lindauer applies; district court denial affirmed. |
Key Cases Cited
- American National Ins. Co. v. FDIC, 642 F.3d 1137 (D.C. Cir. 2011) (claims against purchasing bank can be barred when tied to FDIC as receiver)
- Village of Oakwood v. State Bank & Trust Co., 539 F.3d 373 (6th Cir. 2008) (purchasing bank claims tied to FDIC acts trigger FIRREA exhaustion)
- Am. First Fed., Inc. v. Lake Forest Park, Inc., 198 F.3d 1259 (11th Cir. 1999) (exhaustion appropriate where claims relate to FDIC as receiver)
- Henderson v. Bank of New England, 986 F.2d 319 (9th Cir. 1993) (FIRREA applies to claims susceptible of resolution through the claims procedure)
- Am. Nat'l Ins. Co. v. FDIC, 642 F.3d 1137 (D.C. Cir. 2011) (post-purchase misconduct claims can proceed if not tied to FDIC acts as receiver)