On June 16, the U.S. Supreme Court denied a bank holding company’s petition for certiorari after the Tenth Circuit upheld summary judgment in a bank receivership matter that was granted by a lower court in favor of the State of Utah. In 2009, the Utah Department of Financial Institutions seized a bank’s assets of $300 million, obtained an ex parte order of possession from a state court for allegedly being undercapitalized, and immediately transferred receivership of the bank to the FDIC before notifying the bank’s owners.
In the writ of cert, the bank presented two questions: (i) whether a court is “obligated to afford relief under Federal Rule of Civil Procedure 54(c), rather than be deemed waived, because it holds the relief — not the underlying facts — was not sufficiently requested” and (ii) whether the bank’s due-process rights “were violated by a process that insulated state officials from accountability by permitting immediate assignment to the FDIC as the receiver of a bank before even notifying the bank’s owners so that the state officials faced no accountability and the FDIC as receiver succeeded to any due-process claims that the bank’s owners could have asserted.”
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