983 F.3d 258
6th Cir.2020Background
- James Perna was Health One Credit Union’s long-time general manager under a written employment contract that included an arbitration clause.
- In May 2014 Michigan’s regulator found Health One unsafe and the National Credit Union Administration Board (the Board) was appointed conservator; the Board repudiated Perna’s contract and terminated him.
- In December 2014 a state court appointed the Board as receiver (liquidating agent) and the Board sold Health One’s assets; Perna filed a claims submission with the Board, which denied it as untimely.
- In 2018 Perna pursued arbitration and obtained a $315,645.02 award against Health One only; the arbitrator declined to bind the Board/NCUA.
- Perna then sued in state court to confirm/modify the award to bind the Board; the case was removed to federal court, which granted summary judgment to the defendants on jurisdictional and merits grounds.
- The Sixth Circuit held that 12 U.S.C. § 1787(b)(13)(D) strips courts of jurisdiction over claims like Perna’s and affirmed, but modified the judgment to dismiss for lack of subject-matter jurisdiction (rather than grant of summary judgment).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 1787(b)(13)(D) bars courts from entertaining Perna’s suit for payment from a liquidated credit union’s assets | Perna contends the statutory framework does not preclude his suit | The Board contends § 1787(b)(13)(D) deprives courts of jurisdiction over such claims | Held: § 1787(b)(13)(D) applies and deprives courts of jurisdiction over Perna’s claim |
| Whether § 1787(b) applies to state-chartered but federally insured credit unions like Health One | Perna: § 1787(b) does not govern insured state-chartered credit unions in this context | Board: § 1787(b) applies to any credit union for which the Board is liquidating agent | Held: § 1787(b) applies to federally insured state-chartered credit unions and governs this dispute |
| Whether the arbitration award could be modified to bind the Board/NCUA | Perna: arbitrator erred and award should be modified to make NCUA liable | Defendants: arbitrator correctly limited award to Health One; in any event suit is barred by § 1787(b) | Held: Court did not reach the merits because it lacked subject-matter jurisdiction |
| Whether the removed case should be remanded to state court or dismissed, and whether district court’s grant of summary judgment was proper | Perna did not press remand; sought relief on merits | Board argued dismissal appropriate because no court (state or federal) has jurisdiction | Held: Dismissed for lack of subject-matter jurisdiction; district court’s summary-judgment disposition was modified to dismissal as jurisdictional challenge requires dismissal, not summary judgment |
Key Cases Cited
- Fort Bend Cnty. v. Davis, 139 S. Ct. 1843 (Supreme Court 2019) (clarifies when statutory limitations are jurisdictional vs. claims-processing rules)
- Arbaugh v. Y & H Corp., 546 U.S. 500 (Supreme Court 2006) (labels or clear statutory language can make a provision jurisdictional)
- Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83 (Supreme Court 1998) (courts must resolve jurisdiction before reaching merits)
- Vaden v. Discover Bank, 556 U.S. 49 (Supreme Court 2009) (well-pleaded complaint rule for federal-question jurisdiction)
- In re DePuy Orthopaedics, Inc. ASR Hip Implant Prods. Liab. Litig., 953 F.3d 890 (6th Cir. 2020) (appellate duty to assure subject-matter jurisdiction)
- Village of Oakwood v. State Bank & Trust Co., 539 F.3d 373 (6th Cir. 2008) (FDIC analog: § 1821(d)(13)(D) construed as jurisdictional)
- Dernis v. Amos Fin., [citation="701 F. App'x 449"] (6th Cir. 2017) (applying FDIC analog to find no court jurisdiction over certain claims)
- Miller v. FDIC, 738 F.3d 836 (7th Cir. 2013) (FDIC claims-processing framework treated as jurisdictional)