The year-end vacation days are over, the holiday decorations have been taken down, and last year’s wall calendars have been replaced. We are now into the Narnia season (at least here in Cleveland), where it is always winter but never Christmas. The New Year has entered with a bang, and that means more than
FDIC’s Bid to Intervene in Bank Investors’ Suit Denied
The FDIC as receiver of the failed Haven Trust Bank may not intervene in a securities lawsuit brought by the aggrieved investors of the Bank’s holding company, according to Northern District of Georgia Judge Charles A. Pannell, Jr.’s December 29, 2010 order in the case. Judge Pannell’s ruling, a copy of which can be found
FDIC Lawsuits: Coming Soon to Failed Banks Near You?
The FDIC has authorized more than 50 lawsuits against former directors and officers of failed banks, according to an October 8, 2010 Bloomberg article. But merely because the lawsuits have been authorized does not necessarily mean we will see 50 lawsuits, as it appears that the FDIC approval was calculated in part to encourage
Is the FDIC Staking Out Its Territory or Extending Its Borders?
With one lone exception, the FDIC has not yet itself pursued litigation against the directors and officers of a failed financial institution. However, the FDIC has already made it clear that it intends to assert its rights under FIRREA as the receiver of failed banks to take control of shareholders’ derivative lawsuits.
More
NERA Releases Failed Bank Litigation Report
In recent months, I have documented on this blog the rising tide of failed banks as well as the ensuing failed bank related litigation. An August 16, 2010 report by Paul Hinton of NERA Economic Consulting entitled "Failed Bank Litigation" (here) takes a comprehensive view of the economics and causes of recent bank
Dismissal Motions Denied in Failed and Troubled Bank Securities Cases
Though we are in the midst of the dog days of summer (at least in the northern hemisphere), the federal courts, at least, have been busy. In the last several days alone, several courts have issued dismissal motion rulings in lawsuits arising out of the subprime meltdown and the credit crisis.
As noted below, several
A Failed Bank, A Lawsuit, and Some Interesting Questions
Though 268 banks have failed since January 1, 2008, there has been relatively little litigation related to the failed banks, as least so far. For example, the FDIC only recently filed its first action against former directors and officers of a failed bank (as discussed here). There have also been relatively few suits brought
FDIC Files First D&O Suit of Current Failed Bank Wave
On July 2, 2010, in what is as far as I am aware the first suit by the FDIC against former directors and officers of a failed bank as part of the current wave of bank failures, the FDIC as receiver of IndyMac filed a lawsuit in the Central District of California against four former
FDIC’s Receivership Rights Don’t Bar Fidelity Bond Rescission
The FDIC in its status as receiver of a failed bank may not avoid rescission of a fidelity bond procured by material misrepresentation, notwithstanding the FDIC’s statutory receiver rights, according to a June 7, 2010 Second Circuit decision. This decision represents an important interpretation of the FDIC’s statutory rights as receiver, and could prove to
Icelandic Failed Bank Ash Cloud Hits New York Courts
In prior posts (most recently here), I have noted the growing numbers of lawsuits brought against the former directors and officers of failed or troubled banks. If the complaint recently filed in New York state court is any indication, the "dead bank" lawsuits apparently will also include claims against the directors and offices of