George Dernis v. Amos Financial
701 F. App'x 449
| 6th Cir. | 2017Background
- George and Maria Dernis sued various parties in Michigan state court over attempted foreclosures; they later amended to add the FDIC as a defendant after FDIC had acted as receiver for Premier Bank and assigned loans to a third party.
- The FDIC was personally served through its Chicago regional counsel on July 17, 2015; the FDIC did not appear and default was entered against it in state court.
- On January 25, 2016 (after the state-court default but before a scheduled hearing), the FDIC removed the case to federal court under 12 U.S.C. § 1819(b)(2)(B) and 28 U.S.C. § 1442(a); the Dernises moved to remand as untimely.
- The FDIC moved to dismiss the Dernises’ claims for lack of jurisdiction, arguing the plaintiffs failed to exhaust administrative remedies required by FIRREA (12 U.S.C. § 1821(d)(13)(D)).
- The district court found FDIC’s removal timely (because it concluded service did not comply with Fed. R. Civ. P. 4(i)), dismissed the FDIC claims for lack of jurisdiction under FIRREA, and remanded claims against non-FDIC defendants to state court. The Sixth Circuit affirmed dismissal of FDIC claims and remand of the rest.
Issues
| Issue | Dernis' Argument | FDIC's Argument | Held |
|---|---|---|---|
| Was service on the FDIC’s regional counsel in state court sufficient to start the 30-day removal clock under 28 U.S.C. § 1446? | Service on regional counsel satisfied Michigan rule MCR 2.105(H)(1); 30-day clock began July 17, 2015. | FDIC argued federal regulation and Rule 4(i) required additional service (U.S. Attorney and AG), so service was ineffective and § 1446 never started. | Court held Michigan service on FDIC’s designated regional agent was sufficient; removal was untimely under § 1446. |
| Could FDIC’s internal regulation (12 C.F.R. § 309.7) and Rule 4(i) control service requirements in state-court proceedings? | Dernis: state service rules govern pre-removal; FDIC regulation cannot impose extra state-court procedure. | FDIC: its organic statute and regulation required service as in Rule 4(i), making state service inadequate. | Court followed Wilson: absent explicit statutory authority, agency regs cannot alter state service rules; FDIC reg/Rule 4(i) did not control. |
| Does § 1819(b)(2)(B) 90‑day removal period start on filing or upon formal service? | Dernis: textual reading—90 days starts when FDIC is named/substituted (filing). | FDIC: argues 90-day clock should start upon formal service to avoid gamesmanship and to afford FDIC a federal forum. | Court avoided deciding the statutory-start question because removal was untimely under § 1446 if state service was effective. |
| Did the district court have jurisdiction over Dernises’ claims against FDIC given FIRREA exhaustion requirements (12 U.S.C. § 1821(d)(13)(D))? | Dernis: did not exhaust but argued claims were not subject to § 1821(d)(13)(D) because they did not seek determination of rights to failed-bank assets. | FDIC: claims fall squarely within § 1821(d)(13)(D)(ii) as they relate to acts/omissions of the institution or FDIC as receiver; exhaustion required. | Court held Dernises’ claims were within § 1821(d)(13)(D)(ii); failure to exhaust deprived both state and federal courts of jurisdiction, so dismissal was proper (remand would be futile). |
Key Cases Cited
- Murphy Bros. v. Michetti Pipe Stringing, Inc., 526 U.S. 344 (U.S. 1999) (formal service of process triggers certain statutory time limits)
- Wilson v. United States Dep’t of Agric., 584 F.2d 137 (6th Cir. 1978) (agency regulations cannot alter state service rules for state-court proceedings absent statutory authority)
- Village of Oakwood v. State Bank & Trust Co., 539 F.3d 373 (6th Cir. 2008) (summary of FIRREA administrative-claims process and exhaustion requirements)
- Molosky v. Washington Mut., Inc., 664 F.3d 109 (6th Cir. 2011) (failure to comply with FIRREA claims process removes jurisdiction)
- Tryc v. Michigan Veterans’ Facility, 545 N.W.2d 642 (Mich. 1996) (Michigan statutory interpretation—plain language controls)
- Henderson v. United States, 517 U.S. 654 (U.S. 1996) (service of process is procedural and governed by rules)