The opinion of the court was delivered by: FRIEDMAN
MEMORANDUM OPINION AND ORDER
This matter is before the Court on defendants' motion to dismiss plaintiff's complaint for failure to state a claim upon which relief can be granted under Rule 12(b)(6) of the Federal Rules of Civil Procedure. Plaintiff opposes the motion. The matter was argued before the Court on September 9, 1997. Upon consideration of the parties' briefs and arguments, the Court concludes that the District of Columbia version of the Uniform Commercial Code prevents enforcement of the note against defendant Robinson Broadcasting Corporation, but all other defendants have waived the defense. The motion to dismiss of Robinson Broadcasting Corporation therefore is granted. The motion of all other defendants must be denied.
This is a case about an unpaid note. Plaintiff, the current holder of the note, claims that defendants owe a principal sum of $ 558,938.07, interest of $ 489,474.66 through May 1, 1997 (with interest accruing at $ 156.96 a day), and attorneys' fees and court costs. Subtracted from that amount is $ 39,050.10 in payments that plaintiff concedes having received.
In 1985, defendant Robinson Broadcasting Corporation executed the note in exchange for a loan by the Madison National Bank. At the same time, the remaining defendants ("Guarantor Defendants") executed an unconditional loan guarantee of payment for the note to Madison. The Federal Deposit Insurance Corporation acquired the note when it became receiver for Madison in 1991. The FDIC subsequently sold the note to 4M Communications. In March 1997, FDIC issued an affidavit of lost note to 4M Communications indicating that it had lost the original note. Approximately two months later, 4M Communications sold its interest in the note, via an assignment of promissory note, to the Joslin Company. The Joslin Company is now suing to recover the money owed on the note.
Defendants argue that plaintiff is precluded by statute from suing on this note because the note has been lost and because the note was not in plaintiff's possession at the time the note was lost. See D.C. Code § 28:3-309 (1996). In response, plaintiff argues: (1) that 12 U.S.C. § 1821(j) prevents this Court from reaching the merits of this defense; (2) that the Guarantor Defendants have waived the statutory UCC defense by signing the Loan Guarantee agreement; and (3) that even if there were no waiver, the UCC defense is unavailable to the Guarantor Defendants.
A. Preemption of Defense by 12 U.S.C. § 1821(j)
The Court first addresses plaintiff's contention, raised at oral argument, that 12 U.S.C. § 1821(j) prevents defendants from invoking a defense based on the District of Columbia version of the Uniform Commercial Code, D.C. Code § 28:3-309. The bar imposed by 12 U.S.C. § 1821(j) is jurisdictional and it therefore must be considered prior to a consideration of the statutory defense. See National Trust for Historic Preservation v. FDIC, 305 U.S. App. D.C. 375, 21 F.3d 469, 471 (D.C. Cir.), cert. denied, 513 U.S. 1065, 130 L. Ed. 2d 615, 115 S. Ct. 683 (1994).
Congress has decreed that no court may "take any action, except at the request of the Board of Directors [of the FDIC] by regulation or order, to restrain or affect the exercise of powers or functions of the [Federal Deposit Insurance] Corporation as a conservator or a receiver." 12 U.S.C. § 1821(j) (1989). Our Court of Appeals has held that this provision, in conjunction with 12 U.S.C. § 1821(d)(13)(D), prevents the Court from exercising jurisdiction over actions for injunctive relief brought against the FDIC in its capacity as receiver or conservator; i.e. it is intended to protect the functions of the FDIC from judicial interference.
See Freeman v. FDIC, 312 U.S. App. D.C. 324, 56 F.3d 1394, 1398-99 (D.C. Cir. 1995); National Trust for Historic Preservation v. FDIC, 301 U.S. App. D.C. 338, 995 F.2d 238, 240 (D.C. Cir. 1993), vacated, 303 U.S. App. D.C. 315, 5 F.3d 567 (1993), reinstated, 305 U.S. App. D.C. 375, 21 F.3d 469 (1994), cert. denied, 513 U.S. 1065, 130 L. Ed. 2d 615, 115 S. Ct. 683 (1994). Plaintiff argues that the jurisdictional bar imposed by 12 U.S.C. § 1821(j) also precludes this Court from recognizing defenses to enforcement of a note such as those raised by the defendants, because recognizing such defenses would impair the FDIC's ability to sell notes that it holds as receiver of failed banks.
The Court finds that 12 U.S.C. § 1821(j) is inapplicable to this case. First, while Section 1821(j) has been read broadly, and some courts have recognized that a suit against an entity other than the FDIC as conservator or receiver may nonetheless impair the FDIC's functions, see Pyramid Construction Co., Inc. v. Wind River Petroleum, Inc., 866 F. Supp. 513, 518 (D.Utah 1994), the limitation imposed by 12 U.S.C. § 1821(j) is intended to protect the FDIC's powers and functions as conservator or receiver. It does not follow that these protections attach for all time to a note once held by the FDIC. Plaintiff in this case has not shown that the FDIC's functions will be impaired in any way if this Court recognizes a defense to the note. Section 1821(j) therefore does not deprive this Court of jurisdiction to consider the UCC defense.
Second, while 12 U.S.C. § 1821(j) precludes other individuals or entities from bringing suit against the FDIC as conservator or receiver, it is not at all clear that the provision was intended to prevent defendants from raising affirmative defenses to suits brought by the FDIC or those purporting to stand in its shoes. See Tri-State Hotels, Inc. v. F.D.I.C., 79 F.3d 707, 715 (8th Cir. 1996) (fact that court does not have jurisdiction to order declaratory and rescissory relief against FDIC does not leave plaintiff defenseless if FDIC brings action against plaintiff to enforce loan agreement, because court would have jurisdiction to hear affirmative defenses); cf. Resolution Trust Corp. v. Midwest Federal Savings Bank, 36 F.3d 785, 793 (9th Cir. 1993) (12 U.S.C. § 1821(d)(13(D), a similar jurisdiction-stripping provision, "does not ...