Bhc Interim Funding II, L.P. v. Federal Deposit Insurance Corporation
851 F. Supp. 2d 131
D.D.C.2012Background
- BHC loaned Affinity Financial and Waterfield Financial guaranteed by Waterfield, with a first-priority lien on assets.
- Waterfield Financial’s earnings from pooled accounts funded Affinity’s loan payments to BHC through February 2010.
- OTS directed Waterfield Bank to assign the Agency Relationships and Agency Deposits to Waterfield Bank due to Waterfield Bank’s undercapitalization, resulting in an Assignment Agreement in March 2010.
- FDIC became receiver of Waterfield Bank after the assignment and cancelled the pooled deposit accounts, returning funds to customers.
- BHC filed two proofs of claim with FDIC; FDIC denied, and BHC sued in this court.
- BHC asserted five claims; only the third claim (guaranty rights under the Assignment) was submitted to the FDIC; the others were not.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FIRREA exhaustion applies to FDIC as receiver claims | BHC exhausted for the third claim; other claims were not presented. | Some claims alleged against the FDIC as receiver require exhaustion before jurisdiction. | Exhaustion required; only the third claim properly presented is within jurisdiction. |
| Whether the assignment transferred Waterfield Financial’s guaranty obligations | Guaranties arose from Agency Relationships and were transferred. | Assignment transferred only Agency Relationships and Agency Deposits, not independent guaranties. | Assignment did not transfer Waterfield Financial’s guaranty obligations; third claim fails. |
| Whether the third claim should be dismissed under Rule 12(b)(6) | Waterfield Bank assumed obligations via assignment; FDIC liable. | Text of assignment does not support transfer of guaranties. | Third claim fails because assignment did not transfer guaranty obligations. |
| Whether the court has subject matter jurisdiction over the non-submitted claims | Claims arise from FDIC’s actions as receiver; jurisdiction exists. | Non-submitted claims are barred for lack of exhaustion and jurisdiction. | The court lacks jurisdiction over the non-submitted claims. |
Key Cases Cited
- Am. Nat. Ins. Co. v. FDIC, 642 F.3d 1137 (D.C. Cir. 2011) (FIRREA provides administrator determination then district court review)
- Freeman v. FDIC, 56 F.3d 1394 (D.C. Cir. 1995) (exhaustion rules for claims against FDIC receiver examined)
- Nashville Lodging Co. v. Resolution Trust Corp., 59 F.3d 236 (D.C. Cir. 1995) (broad view of administrative claims process in FIRREA)
- Office & Prof’l Emps. Int’l Union v. FDIC, 962 F.2d 63 (D.C. Cir. 1992) (administrative exhaustion principle for claims against FDIC as receiver)
- Auction Co. of Am. v. FDIC, 141 F.3d 1198 (D.C. Cir. 1998) (exhaustion and administrative process for receiver claims outlined)