interest in the property, in the event the building owners defaulted on the deed of trust. Id. The building owners did indeed default on the debt and filed for bankruptcy shortly thereafter. Plaintiff filed suit attacking the deed of trust, claiming, inter alia, that the Bank had misrepresented to the plaintiff its ability to administer the loan and the concomitant Deed of Trust and that the Bank had imperfectly performed its obligations under the terms of the construction loan. Id. at 544. When the plaintiff filed suit, the RTC had stepped in as receiver for the failed Bank. Id. at 543.
The district court in Washington Properties relied squarely on the Supreme Court's recent opinion in Langley v. FDIC, 484 U.S. 86, 98 L. Ed. 2d 340, 108 S. Ct. 396 (1987), in holding that a claim of fraudulent inducement is barred by § 1823(e). In Langley, a unanimous Supreme Court held that, in an action for payment of a note brought by the FDIC in its corporate capacity, § 1823(e) barred a defense that the note was procured by fraud in the inducement. 484 U.S. at 403 (holding that "[a] condition to payment of a note . . . is part of the "agreement" to which the writing, approval, and filing requirements of 12 U.S.C. § 1823(e) attach"). The court in Washington Properties followed suit, holding that "the fact that a party claims that a representation was fraudulent and fraudulently induced them to secure a bank loan does not defeat the application of§ 1823(e)." 796 F. Supp. at 545.
This case presents exactly the same scenario as that in Washington Properties; plaintiffs aver that Vista, through its attorneys, orally represented to them that their signatures on the $ 2.5 million promissory note were legally required, when in fact they were not, and that this oral representation caused them to sign the promissory note. Section 1823(e), Langley, and Washington Properties stand squarely against plaintiff's claim. Defendant RTC is entitled to summary judgment as to Count I of plaintiffs' complaint.
II. Counts II and III and the RTC Claims Process
Plaintiffs assert in Counts II and III of their complaint claims of negligence and breach of contract against the RTC and the individual defendants. Plaintiffs did not submit these claims to the RTC administrative claims process, as they are required to do before this Court may exercise jurisdiction over them. 12 U.S.C. § 1821(d)(5) sets out procedures for RTC determination of claims; § 1821(d)(6) allows for judicial review of disallowed claims; and § 1821(d)(13)(D) restricts judicial review of claims against the RTC to those claims which have previously been submitted to the RTC administrative review process. See also Coleman v. FDIC, 826 F. Supp. 31 (D.Mass. 1993) (no court may exercise jurisdiction over any claim against the FDIC as receiver unless the claimant has first submitted its claim to the FDIC administrative claims process). Plaintiffs submitted a claim to the RTC in June 1992 for damages of $ 250,000, claiming fraudulent inducement;
plaintiffs have not submitted any claims to the RTC based on negligence or breach of contract, nor have they submitted claims for the amount of damages they seek in this Court.
Plaintiffs state in their opposition to defendant RTC's summary judgment motion that other parties associated with the failed Berrywood Estates project have filed claims against the RTC for negligence and breach of contract, and that it was a mere oversight that plaintiffs were not included as claimants in the parties' submission to the RTC claims process under those claims. Plaintiffs' Opp. at 4. Whether this is or is not the case, the fact remains that plaintiffs were never joined as claimants on the other parties' negligence and breach of contract claims submitted to the RTC, and this Court cannot treat plaintiffs as if their claims were somehow grafted onto the third-party submissions to the RTC claims process. Plaintiffs themselves should have submitted their claims of negligence and breach of contract, and their considerably enhanced damages claims, to the RTC prior to filing suit in this Court. Since the deadline for filing with the RTC proof of claims against Vista has long since passed,
RTC's motion for summary judgment as to Counts II and III must be granted as well.
Defendant Lenser's Motion To Dismiss
Defendant Mary Lenser has moved to dismiss plaintiffs' complaint on two grounds: first, that she was never served with a summons as required by Fed R. Civ. P. 4(c)(1), and second, that this Court lacks personal jurisdiction over her. Plaintiffs have failed to respond to defendant Lenser's motion to dismiss. Therefore, the Court treats defendant Lenser's motion as conceded and grants her motion to dismiss.
Remaining is defendant Gerald Chapman. Chapman was named as a defendant in plaintiffs' complaint, but no evidence exists that Chapman was ever served with a copy of the summons and complaint within the 120 days of the filing of plaintiffs' complaint, as required by Fed. R. Civ. P. 4(m). Accordingly, unless plaintiffs provide the Court with proof of timely service within 21 days of the date of this Opinion, the Court will dismiss plaintiffs' action against defendant Chapman.
Plaintiffs' Motion for Alternative Dispute Resolution
Plaintiffs filed a motion requesting the Court to assign this action to the court's alternative dispute resolution process. Because this Opinion resolves most, if not all, of this case, plaintiffs' motion is denied as moot. An appropriate Order accompanies this Opinion.
Stanley S. Harris
United States District Judge
For the reasons stated in the accompanying Opinion, it hereby is
ORDERED, that defendant RTC's motion for summary judgment is granted. It hereby further is
ORDERED, that defendant Lenser's motion to dismiss is granted. It hereby further is
ORDERED, that plaintiffs shall provide proof of timely service on defendant Chapman within 21 days of the date of this Order, or the Court shall dismiss defendant Chapman from this action pursuant to Fed. R. Civ. P. 4(m). It hereby further is
ORDERED, that plaintiffs' motion for alternative dispute resolution is denied.
Stanley S. Harris
United States District Judge