and Submitted October 24, 2019 Pasadena, California
from the United States District Court for the Southern
District of California Dana M. Sabraw, District Judge,
Presiding No. 3:12-cv-01207-DMS-BLM.
Shaw (argued), Solana Beach, California, pro se; Chris Ford,
Ford Law AZ, Phoenix, Arizona; for Plaintiff-Appellant.
E. Schoenfeld (argued), Wilmer Cutler Pickering Hale and Dorr
LLP, New York, New York; Albinas J. Prizgintas and Arpit K.
Garg, Wilmer Cutler Pickering Hale and Dorr LLP, Washington,
D.C.; Bryant S. Delgadillo and Mariel Gerlt-Ferraro, Parker
Ibrahim & Berg LLP, Costa Mesa, California; for
Before: Andrew J. Kleinfeld, Consuelo M. Callahan, and Ryan
D. Nelson, Circuit Judges.
in Lending Act
panel affirmed the district court's dismissal of a Truth
in Lending Act claim for lack of subject matter jurisdiction
based on the jurisdiction-stripping provisions of the
Financial Institutions Reform, Recovery, and Enforcement Act.
sought rescission of a mortgage loan on the ground that the
lender violated TILA by providing him with defective notice
of the right to cancel when the loan was signed. The panel
held that FIRREA's administrative exhaustion requirement
applied because there was (1) a "claim" that (2)
related to "any act or omission" of (3) an
institution for which the Federal Deposit Insurance Corp. had
been appointed receiver. First, the panel held that plaintiff
had a "claim" because his cause of action gave
right to the equitable remedy of rescission and was
susceptible of resolution via FIRREA's claims process.
Agreeing with the Fourth Circuit, the panel concluded that
there was no requirement that the loan have passed through an
FDIC receivership. Second, the panel held that
plaintiff's claim related to an act or omission, that is,
the lender's alleged failure to comply with TILA's
disclosure requirements. Finally, the third element was met
because the lender had failed and the FDIC had been appointed
as receiver. The panel further held that FIRREA's
statutory exhaustion requirement does not contain a futility
exception, allowing a claim to proceed when filing with the
FDIC would be futile.
panel held that plaintiff did not exhaust his remedies with
the FDIC before filing suit, and his later communications
with the FDIC did not prevent dismissal of his TILA claim for
lack of subject matter jurisdiction. In addition, the
district court did not abuse its discretion in denying
plaintiff's request for further discovery.
Nelson, Circuit Judge.
Norman Shaw appeals from the district court's dismissal
of his Truth in Lending Act ("TILA") claim for lack
of subject matter jurisdiction based on the
jurisdiction-stripping provisions of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989
("FIRREA"). Because we agree that the district
court lacked subject matter jurisdiction, we affirm the
district court's dismissal.
Norman Shaw owns a home in Solana Beach, California. In 2006,
he refinanced his home loan, borrowing $1.26 million from
Washington Mutual Bank ("WaMu"). One month later,
LaSalle Bank, N.A. allegedly became the trustee of his loan,
although WaMu continued to service it. WaMu was later closed
and placed into the receivership of the Federal Deposit
Insurance Corporation ("FDIC"). At that time,
JPMorgan Chase Bank acquired WaMu's assets via a Purchase
and Assumption Agreement with the FDIC.
2009, Mr. Shaw defaulted on his home loan and a foreclosure
date was set. A month before foreclosure, Mr. Shaw sent
notices of loan rescission to WaMu, JP Morgan Chase, and Bank
of America pursuant to instructions in his loan documents.
Mr. Shaw sought rescission, claiming that WaMu violated TILA
by providing him with defective notice of the right to cancel
when the loan was signed. None of the institutions contacted
by Mr. Shaw rescinded the loan.
"short on options to save [his] home," Mr. Shaw
declared bankruptcy, which halted foreclosure proceedings. He
then filed a TILA lawsuit as an adversary proceeding in
bankruptcy court. By that point, the trustee of the loan was
U.S. Bank, a successor in interest to Bank of America. U.S.
Bank moved to dismiss Mr. Shaw's adversarial action for
lack of jurisdiction. The bankruptcy court agreed.
Shaw then brought this action in May 2012, seeking rescission
of the loan under TILA. After several years of litigation,
including an appeal to this court, U.S. Bank moved to dismiss
Mr. Shaw's claim for lack of jurisdiction, arguing he
failed to exhaust administrative remedies through the FDIC as
required by FIRREA. Mr. Shaw responded that FIRREA did not
apply and further discovery was needed to make that showing.
The district court rejected these arguments, granted U.S.
Bank's motion, and entered judgment. This appeal
this appeal was pending, Mr. Shaw sent the FDIC a letter
explaining the alleged TILA violations and requesting
assistance in rescinding the loan. Mr. Shaw told the FDIC
that his loan was owned by "either LaSalle Bank, Bank of
America, or both." The FDIC responded a week later,
explaining it was "unable to process" his request
because "[t]he financial ...