uwbkq 4-30-2013 notice of appeal

APPEAL,CLOSED,TYPE−C

U.S. District CourtDistrict of Columbia (Washington, DC)

CIVIL DOCKET FOR CASE #: 1:11−cv−00408−ABJ

UNITED WESTERN BANK v. OFFICE OF THECOMPTROLLER OF THE CURRENCY, et alAssigned to: Judge Amy Berman JacksonCause: 05:551 Administrative Procedure Act

Date Filed: 02/18/2011Date Terminated: 03/06/2013Jury Demand: NoneNature of Suit: 890 Other StatutoryActionsJurisdiction: U.S. Government Defendant

Plaintiff

UNITED WESTERN BANK represented byAndrew L. SandlerBUCKLEYSANDLER LLP1250 24th Street, NWSuite 700Washington, DC 20037(202) 349−8001Fax: (202) 349−8080Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Kirby D. BehrePAUL HASTINGS LLP875 15th Street, NWWashington, DC 20005(202) 551−1719Fax: (202) 551−1705Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Lawrence KaplanPAUL HASTINGS LLP875 15th Street, NWWashington, DC 20005(202) 551−1829Fax: (202) 551−0229Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Michael R. WilliamsBUCKLEYSANDLER LLP1250 24th Street, NWSuite 700Washington, DC 20037(202) 349−8065

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Case 1:11-cv-00408-ABJ Document 116 Filed 04/29/13 of 76

USCA Case #13-5126 Document #1433411 Filed: 04/30/2013 Page 1 of 76

https://ecf.dcd.uscourts.gov/cgi-bin/DktRpt.pl?146751

mailto:[email protected]



Fax: (202) 349−8080Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Samuel John BuffoneBUCKLEYSANDLER LLP1250 24th Street, NWSuite 700Washington, DC 20037(202) 349−7940Fax: (202) 349−8080Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Liana R. PrietoBUCKLEYSANDLER LLP1250 24th Street, NWSuite 700Washington, DC 20037(202) 461−2948Fax: (202) 349−8080Email: [email protected] HAC VICEATTORNEY TO BE NOTICED

Theodore J. AbariotesUNITED WESTERN BANCORP, INC.700 17th StreetSuite 750Denver, CO 80202(720) 932−4216Fax: (720) 946−1218Email: [email protected] HAC VICEATTORNEY TO BE NOTICED

Plaintiff

UNITED WESTERN BANCORP,INC.Individually and on behalf of UnitedWestern Bank as sole shareholder ofUnited Western BankTERMINATED: 06/24/2011

represented byAndrew L. Sandler(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Theodore J. Abariotes(See above for address)PRO HAC VICEATTORNEY TO BE NOTICED

Plaintiff

GUY A. GIBSON represented byAndrew L. Sandler

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Individually and on behalf of UnitedWestern Bank and United WesternBankcorp, Inc.TERMINATED: 06/24/2011

(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Samuel John Buffone(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Liana R. Prieto(See above for address)PRO HAC VICEATTORNEY TO BE NOTICED

Plaintiff

MICHAEL J. MCCLOSKEYIndividually and on behalf of UnitedWestern Bancorp, Inc.TERMINATED: 06/24/2011


Samuel John Buffone(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Liana R. Prieto(See above for address)PRO HAC VICEATTORNEY TO BE NOTICED

Plaintiff

JAMES H. BULLOCKIndividually and on behalf of UnitedWestern Bank and United WesternBankcorp, Inc.TERMINATED: 06/24/2011


Kirby D. Behre(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Lawrence Kaplan(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Plaintiff

CHARLES J. BERLINGIndividually and on behalf of UnitedWestern BankTERMINATED: 06/24/2011


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Plaintiff

ROBERT T. SLEZAKIndividually and on behalf of UnitedWestern Bankcorp, Inc.TERMINATED: 06/24/2011




V.

Defendant

OFFICE OF THRIFT SUPERVISIONTERMINATED: 07/25/2011

represented byDirk S. RobertsOFFICE OF THE COMPTROLLER OFTHE CURRENCY250 E Street, SWWashington, DC 20219(202) 874−6051Fax: (202) 874−5279Email: [email protected]: 12/28/2011

Sarah J. AuchterlonieOFFICE OF THRIFT SUPERVISION1700 G Street, N.W.Washington, DC 20552(202) 906−6482Fax: (202) 906−6353Email: [email protected]: 07/07/2011

Defendant

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JOHN E. BOWMANin his capacity as Acting Director of theOffice of Thrift SupervisionTERMINATED: 07/25/2011

represented byDirk S. Roberts(See above for address)TERMINATED: 12/28/2011

Sarah J. Auchterlonie(See above for address)TERMINATED: 07/07/2011

Defendant

FEDERAL DEPOSIT INSURANCECORPORATIONin its Corporate Capacity and in itscapacity as Receiver for United WesternBankTERMINATED: 06/24/2011

represented byDuncan Norman StevensFEDERAL DEPOSIT INSURANCECORPORATIONLegal Division, Professional Liability Unit3501 Fairfax DriveArlington, VA 22226−3500(703) 562−2402Fax: (703) 562−2477Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Merritt Albert PardiniFEDERAL DEPOSIT INSURANCECORPORATIONLegal Division, Professional Liability Unit3501 Fairfax DriveArlington, VA 22226−3500(703) 562−6079Fax: (703) 562−2475Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Defendant

OFFICE OF THE COMPTROLLEROF THE CURRENCY

represented byChristopher A. SterbenzOFFICE OF THE COMPTROLLER OFTHE CURRENCY250 E Street, SWWashington, DC 20219(202) 927−9124Fax: (202) 874−5279Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Gregory F. TaylorOFFICE OF THE COMPTROLLER OFTHE CURRENCYCHIEF COUNSEL'S OFFICE400 7th Street, SWWashington, DC 20219

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(202) 649−6306Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Dirk S. Roberts(See above for address)TERMINATED: 12/28/2011

Defendant

JOHN G. WALSHActing Comptroller of the CurrencyTERMINATED: 04/18/2012

represented byChristopher A. Sterbenz(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Gregory F. Taylor(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Dirk S. Roberts(See above for address)TERMINATED: 12/28/2011

Defendant

THOMAS J. CURRYComptroller of the Currency

represented byChristopher A. Sterbenz(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Gregory F. Taylor(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

V.

Intervenor Defendant

FEDERAL DEPOSIT INSURANCECORPORATIONin it's corporate capacity

represented byDuncan Norman Stevens(See above for address)LEAD ATTORNEYATTORNEY TO BE NOTICED

Intervenor

LEGENT CLEARING, LLC represented byStephen A. MetzSHULMAN, ROGERS, GANDAL,PORDY &ECKER, P.A.12505 Park Potomac AvenueSixth FloorPotomac, MD 20854−6803

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(301) 230−6564Fax: (301) 230−2891Email: [email protected] ATTORNEYATTORNEY TO BE NOTICED

Jeffrey Carter AndersenBUSH ROSS, P.A.1801 North Highland AvenueTampa, FL 33602(813) 204−6405Fax: (813) 223−9620Email: [email protected] HAC VICEATTORNEY TO BE NOTICED

Traci L KosterBUSH ROSS, P.A.1801 North Highland AvenueTampa, FL 33602(813) 204−6496Fax: (813) 223−9620Email: [email protected] HAC VICEATTORNEY TO BE NOTICED

Date Filed # Page Docket Text

02/18/2011 1 COMPLAINT against JOHN E. BOWMAN,FEDERAL DEPOSIT INSURANCECORPORATION, OFFICE OF THRIFTSUPERVISION ( Filing fee $ 350, receipt number4616036632) filed by MICHAEL J.MCCLOSKEY, JAMES H. BULLOCK, ROBERTT. SLEZAK, CHARLES J. BERLING, UNITEDWESTERN BANCORP, INC., UNITEDWESTERN BANK, GUY A. GIBSON.(Attachments: # 1 Civil Cover Sheet)(jf, ) (Entered:02/18/2011)

02/18/2011 SUMMONS (6) Issued as to (1) JOHN E.BOWMAN, (2) FEDERAL DEPOSITINSURANCE CORPORATION, (1) OFFICE OFTHRIFT SUPERVISION, U.S. Attorney and U.S.Attorney General. (jf, ) (Entered: 02/18/2011)

02/18/2011 2 LCvR 7.1 CERTIFICATE OF DISCLOSURE ofCorporate Affiliations and Financial InterestsNONE by UNITED WESTERN BANCORP, INC.,UNITED WESTERN BANK. (jf, ) (Entered:02/18/2011)

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https://ecf.dcd.uscourts.gov/doc1/04503302221?caseid=146751&de_seq_num=14&hdr=1&pdf_header=1&pdf_toggle_possible=1



02/23/2011 3 RETURN OF SERVICE/AFFIDAVIT ofSummons and Complaint Executed on AttorneyGeneral. Date of Service Upon Attorney General02/18/2011., RETURN OFSERVICE/AFFIDAVIT of Summons andComplaint Executed. All Defendants served on2/18/2011, RETURN OF SERVICE/AFFIDAVITof Summons and Complaint Executed as to the USAttorney. Date of Service Upon U.S. Attorney2/18/2011. ( Answer due for ALL FEDERALDEFENDANTS by 4/19/2011.) (Sandler, Andrew)Modified on 2/24/2011 to add served date (jf, ).(Entered: 02/23/2011)

02/23/2011 4 MOTION for Leave to Appear Pro Hac Vice:Attorney Name− Liana R. Prieto, :Firm−BuckleySandler LLP, :Address− 1250 24th StreetNW, Suite 700. Phone No. − 202 461 2948. FaxNo. − 202 349 8080 by UNITED WESTERNBANK (Attachments: # 1 Text of ProposedOrder)(Sandler, Andrew) (Entered: 02/23/2011)

02/23/2011 5 MOTION for Leave to Appear Pro Hac Vice:Attorney Name− Theodore J. Abariotes, :Firm−United Western Bancorp, Inc., :Address− 700 17thStreet, Suite 750; Denver Colorado 80202. PhoneNo. − 720 932 4216. Fax No. − 720 946 1218 byUNITED WESTERN BANK (Attachments: # 1Text of Proposed Order)(Sandler, Andrew)(Entered: 02/23/2011)

02/24/2011 MINUTE ORDER granting 5 Motion for Leave toAppear Pro Hac Vice: Upon consideration of theMotion for Pro Hac Vice Admission, and therecord inthis case, it is hereby ORDERED that theCourt grants permission for Theodore J. Abariotesto appear pro hac vice in this action. Signed byJudge Ellen S. Huvelle on February 24, 2011. (AG)(Entered: 02/24/2011)

02/24/2011 MINUTE ORDER granting 4 Motion for Leave toAppear Pro Hac Vice: Upon consideration of theMotion for Pro Hac Vice Admission, and therecord inthis case, it is hereby ORDERED, that theCourt grants permission for Liana R. Prieto toappear pro hac vice in this action pending heradmission to the bar of this Court. Signed by JudgeEllen S. Huvelle on February 24, 2011. (AG)(Entered: 02/24/2011)

02/28/2011 6 NOTICE of Appearance by Christopher A.Sterbenz on behalf of JOHN E. BOWMAN,OFFICE OF THRIFT SUPERVISION (Sterbenz,

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Christopher) (Entered: 02/28/2011)

02/28/2011 7 NOTICE Appearance of Dirk S. Roberts on behalfof John E. Bowman and Office of ThriftSupervision by JOHN E. BOWMAN, OFFICE OFTHRIFT SUPERVISION (Sterbenz, Christopher)(Entered: 02/28/2011)

02/28/2011 8 NOTICE of Appearance by Duncan NormanStevens on behalf of FEDERAL DEPOSITINSURANCE CORPORATION (Stevens,Duncan) (Entered: 02/28/2011)

02/28/2011 9 NOTICE of Appearance by Sarah J. Auchterlonieon behalf of OFFICE OF THRIFTSUPERVISION, JOHN E. BOWMAN.(Auchterlonie, Sarah) Modified filer on 3/1/2011(znmw, ). (Entered: 02/28/2011)

03/01/2011 10 MOTION to Compel Production of theAdministrative Record by CHARLES J.BERLING, JAMES H. BULLOCK, GUY A.GIBSON, MICHAEL J. MCCLOSKEY, ROBERTT. SLEZAK, UNITED WESTERN BANCORP,INC., UNITED WESTERN BANK (Attachments:# 1 Memorandum in Support, # 2 Text of ProposedOrder)(Sandler, Andrew) (Entered: 03/01/2011)

03/02/2011 11 NOTICE of Appearance by Samuel John Buffoneon behalf of GUY A. GIBSON, MICHAEL J.MCCLOSKEY, UNITED WESTERN BANK(Buffone, Samuel) (Entered: 03/02/2011)

03/04/2011 12 Memorandum in opposition to re 10 MOTION toCompel Production of the Administrative Recordfiled by JOHN E. BOWMAN, OFFICE OFTHRIFT SUPERVISION. (Attachments: # 1 Textof Proposed Order)(Sterbenz, Christopher)(Entered: 03/04/2011)

03/04/2011 13 MOTION to Dismiss by JOHN E. BOWMAN,OFFICE OF THRIFT SUPERVISION(Attachments: # 1 Memorandum in Support, # 2Declaration, # 3 Exhibit Exhibit 1, # 4 ExhibitExhibit 2, # 5 Exhibit Exhibit 3, # 6 ExhibitExhibit 4, # 7 Exhibit Exhibit 5, # 8 ExhibitExhibit 6, # 9 Text of Proposed Order)(Sterbenz,Christopher) (Entered: 03/04/2011)

03/07/2011 14 NOTICE of Appearance by Merritt Albert Pardinion behalf of FEDERAL DEPOSIT INSURANCECORPORATION (Pardini, Merritt) (Entered:03/07/2011)

03/11/2011 15

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REPLY to opposition to motion re 10 MOTION toCompel Production of the Administrative Recordfiled by CHARLES J. BERLING, JAMES H.BULLOCK, GUY A. GIBSON, MICHAEL J.MCCLOSKEY, ROBERT T. SLEZAK, UNITEDWESTERN BANCORP, INC., UNITEDWESTERN BANK. (Sandler, Andrew) (Entered:03/11/2011)

03/18/2011 16 Memorandum in opposition to re 13 MOTION toDismiss filed by CHARLES J. BERLING, JAMESH. BULLOCK, GUY A. GIBSON, MICHAEL J.MCCLOSKEY, ROBERT T. SLEZAK, UNITEDWESTERN BANCORP, INC., UNITEDWESTERN BANK. (Attachments: # 1 ExhibitDeclaration of Theodore J. Abariotes, # 2 Text ofProposed Order)(Sandler, Andrew) (Entered:03/18/2011)

03/25/2011 17 REPLY to opposition to motion re 13 MOTION toDismiss filed by JOHN E. BOWMAN, OFFICEOF THRIFT SUPERVISION. (Sterbenz,Christopher) (Entered: 03/25/2011)

03/30/2011 18 NOTICE of Filing of Declarations in Opposition toDefendants' Motion to Dismiss by CHARLES J.BERLING, JAMES H. BULLOCK, GUY A.GIBSON, MICHAEL J. MCCLOSKEY, ROBERTT. SLEZAK, UNITED WESTERN BANCORP,INC., UNITED WESTERN BANK (Attachments:# 1 Declaration of C. Berling, # 2 Declaration of J.Bullock, # 3 Declaration of B. Darre, # 4Declaration of G. Gibson, # 5 Declaration of B.Hirsh, # 6 Declaration of J. Peoples)(Sandler,Andrew) (Entered: 03/30/2011)

03/30/2011 Case randomly reassigned to U.S. District JudgeAmy Berman Jackson. Judge Ellen S. Huvelle nolonger assigned to the case. (gt, ) (Entered:03/30/2011)

04/19/2011 19 MOTION to Expedite Consideration of PendingMotions by CHARLES J. BERLING, JAMES H.BULLOCK, GUY A. GIBSON, MICHAEL J.MCCLOSKEY, ROBERT T. SLEZAK, UNITEDWESTERN BANCORP, INC., UNITEDWESTERN BANK (Attachments: # 1 Text ofProposed Order)(Sandler, Andrew) (Entered:04/19/2011)

04/19/2011 20 Consent MOTION to Amend/Correct Docket andCaption by FEDERAL DEPOSIT INSURANCECORPORATION (Attachments: # 1 Text ofProposed Order)(Stevens, Duncan) (Entered:

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04/19/2011)

04/19/2011 21 Joint MOTION to Dismiss for Lack of SubjectMatter Jurisdiction Or, in the Alternative, forFailure to State a Claim by FEDERAL DEPOSITINSURANCE CORPORATION (Attachments: # 1Memorandum in Support, # 2 Exhibit A: January21, 2011 OTS Order, # 3 Text of ProposedOrder)(Stevens, Duncan) (Entered: 04/19/2011)

05/02/2011 22 Memorandum in opposition to re 21 JointMOTION to Dismiss for Lack of Subject MatterJurisdiction Or, in the Alternative, for Failure toState a Claim filed by CHARLES J. BERLING,JAMES H. BULLOCK, GUY A. GIBSON,MICHAEL J. MCCLOSKEY, ROBERT T.SLEZAK, UNITED WESTERN BANCORP,INC., UNITED WESTERN BANK. (Attachments:# 1 Memorandum in Support, # 2 Certificate ofService)(Sandler, Andrew) (Entered: 05/02/2011)

05/02/2011 23 ENTERED IN ERROR.....NOTICE of Appearanceby Dirk S. Roberts on behalf of JOHN E.BOWMAN, OFFICE OF THRIFT SUPERVISION(znmw, ) Modified on 5/2/2011 (znmw, ).(Entered: 05/02/2011)

05/02/2011 24 ENTERED IN ERROR.....NOTICE of Appearanceby Martin Jefferson Davis on behalf of JOHN E.BOWMAN, OFFICE OF THRIFT SUPERVISION(znmw, ) Modified on 5/5/2011 (znmw, ).(Entered: 05/02/2011)

05/02/2011 NOTICE OF CORRECTED DOCKET ENTRY:Docket Entries 23 Notice of Appearance, and 24Notice of Appearance were entered in error andwill not be refiled. (znmw, ) (Entered: 05/02/2011)

05/03/2011 25 Memorandum in opposition to re 19 MOTION toExpedite Consideration of Pending Motions filedby OFFICE OF THRIFT SUPERVISION, JOHNE. BOWMAN. (Auchterlonie, Sarah) Modified toadd filer on 5/4/2011 (znmw, ). (Entered:05/03/2011)

05/03/2011 26 Memorandum in opposition to re 19 MOTION toExpedite Consideration of Pending Motions filedby FEDERAL DEPOSIT INSURANCECORPORATION. (Pardini, Merritt) (Entered:05/03/2011)

05/09/2011 27 REPLY to opposition to motion re 21 JointMOTION to Dismiss for Lack of Subject MatterJurisdiction Or, in the Alternative, for Failure toState a Claim filed by FEDERAL DEPOSIT

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INSURANCE CORPORATION. (Stevens,Duncan) (Entered: 05/09/2011)

05/16/2011 NOTICE of Hearing: Status Conference/MotionsHearing is set for 5/20/2011 at 10:00 AM inCourtroom 2 before Judge Amy Berman Jackson.(jth) (Entered: 05/16/2011)

05/17/2011 28 NOTICE of Appearance by Lawrence Kaplan onbehalf of CHARLES J. BERLING, JAMES H.BULLOCK, ROBERT T. SLEZAK, UNITEDWESTERN BANK (Kaplan, Lawrence) (Entered:05/17/2011)

05/20/2011 Minute Entry for proceedings held before JudgeAmy Berman Jackson: Motions Hearing held on5/20/2011: re 10 MOTION to Compel Productionof the Administrative Record, and 19 MOTION toExpedite Consideration of Pending Motions filedby Plaintiffs UNITED WESTERN BANK, et al.;motions heard and taken under advisement. (CourtReporter Lisa Schwam) (jth) (Entered: 05/20/2011)

05/20/2011 29 NOTICE of Filing of Supplemental Exhibits inSupport of Motion to Dismiss by JOHN E.BOWMAN, OFFICE OF THRIFT SUPERVISIONre 13 MOTION to Dismiss (Attachments: # 1Exhibit Supplemental Exhibit 1 in Support of OTSMotion to Dismiss, # 2 Exhibit SupplementalExhibit 2 in Support of OTS Motion toDismiss)(Sterbenz, Christopher) (Entered:05/20/2011)

05/25/2011 30 TRANSCRIPT OF PROCEEDINGS before JudgeAmy Berman Jackson held on 05/20/2011; PageNumbers: 1−45. Court Reporter/Transcriber LisaSchwam, Telephone number 202−354−3238, CourtReporter Email Address : [email protected].

For the first 90 days after this filing date, thetranscript may be viewed at the courthouse at apublic terminal or purchased from the courtreporter referenced above. After 90 days, thetranscript may be accessed via PACER. Othertranscript formats, (multi−page, condensed, CD orASCII) may be purchased from the court reporter.

NOTICE RE REDACTION OFTRANSCRIPTS: The parties have twenty−onedays to file with the court and the court reporterany request to redact personal identifiers from thistranscript. If no such requests are filed, thetranscript will be made available to the public via

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PACER without redaction after 90 days. Thepolicy, which includes the five personal identifiersspecifically covered, is located on our website atww.dcd.uscourts.gov.

Redaction Request due 6/15/2011. RedactedTranscript Deadline set for 6/25/2011. Release ofTranscript Restriction set for 8/23/2011.(Schwam,Lisa) (Entered: 05/25/2011)

06/08/2011 MINUTE ORDER granting 10 Motion to Compel.The Court has preliminarily determined forpurposes of this motion that there are likely to be atleast one proper plaintiff and one proper defendantin this action, and therefore, discovery mayproceed pending the issuance of the Court'smemorandum opinion and order on the motions todismiss (Dkt. #'s 13 and 21). Defendant is directedto produce the administrative record −− which itadvised the Court at the status hearing on May 25,2011 is already ready −− on or before June 17,2011. Counsel for Plaintiff United Western Bankand for defendant John E. Bowman and the Officeof Thrift Supervision are hereby directed to meetand confer − and assume for purposes of the meetand confer that they will be parties to the action −−and submit an agreed scheduling order to the Courton or before July 5, 2011. If agreement cannot beachieved, and initial Scheduling Conference willbe held on July 13, 2011 at 10:00 a.m. Signed byJudge Amy Berman Jackson on 6/8/2011. (jth)(Entered: 06/08/2011)

06/23/2011 31 TRANSCRIPT OF PROCEEDINGS before JudgeAmy Berman Jackson held on 05−20−2011; PageNumbers: 1−45. Court Reporter/Transcriber LisaSchwam, Telephone number 202−354−3238, CourtReporter Email Address : [email protected].


NOTICE RE REDACTION OFTRANSCRIPTS: The parties have twenty−onedays to file with the court and the court reporterany request to redact personal identifiers from thistranscript. If no such requests are filed, the

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transcript will be made available to the public viaPACER without redaction after 90 days. Thepolicy, which includes the five personal identifiersspecifically covered, is located on our website atww.dcd.uscourts.gov.


06/24/2011 32 ORDER granting 21 Defendant FDIC's Motion toDismiss and granting in part and denying in part 13Defendants John E. Bowman and the Office ofThrift Supervision's Motion to Dismiss. Signed byJudge Amy Berman Jackson on 6/24/2011. (lcabj2,) (Entered: 06/24/2011)

06/24/2011 33 MEMORANDUM OPINION. Signed by JudgeAmy Berman Jackson on 6/24/2011. (lcabj2, )(Entered: 06/24/2011)

06/24/2011 MINUTE ORDER dismissing 19 Motion toExpedite as moot. Signed by Judge Amy BermanJackson on 6/24/2011. (lcabj2, ) (Entered:06/24/2011)

06/24/2011 MINUTE ORDER dismissing 20 Motion toAmend/Correct as moot. Signed by Judge AmyBerman Jackson on 6/24/2011. (lcabj2, ) (Entered:06/24/2011)

07/05/2011 34 MEET AND CONFER STATEMENT.(Attachments: # 1 Text of Proposed Order JointProposed Scheduling Order)(Sandler, Andrew)(Entered: 07/05/2011)

07/06/2011 MINUTE ORDER: The Initial SchedulingConference set for 7/13/2011 at 10:00 a.m. hasbeen taken off the Court's calendar. Signed byJudge Amy Berman Jackson on 7/6/2011. (MT)(Entered: 07/06/2011)

07/06/2011 35 SCHEDULING ORDER: Plaintiff's motion tocompel supplementation of the administrativerecord will be due 7/11/2011, the opposition willbe due 8/1/2011, and the reply will be due8/8/2011. Signed by Judge Amy Berman Jacksonon 7/6/2011. (MT) (Entered: 07/06/2011)

07/06/2011 Set/Reset Deadlines: Motion to Compel due by7/11/2011. Response due by 8/1/2011 Replys dueby 8/8/2011. (tb, ) (Entered: 07/06/2011)

07/07/2011 36

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NOTICE OF WITHDRAWAL OFAPPEARANCE as to JOHN E. BOWMAN,OFFICE OF THRIFT SUPERVISION. AttorneySarah J. Auchterlonie terminated. (Auchterlonie,Sarah) (Entered: 07/07/2011)

07/07/2011 40 MOTION to Intervene by LEGENT CLEARING,LLC (Attachments: # 1 Text of Proposed Order forMotion to Intervene, # 2 Exhibit Motion forProtective Order, # 3 Memorandum in Support, # 4Exhibit A, # 5 Exhibit B, # 6 Text of ProposedOrder for Motion for Protective Order)(jf, )(Entered: 07/15/2011)

07/08/2011 37 ANSWER to 1 Complaint, by JOHN E.BOWMAN, OFFICE OF THRIFTSUPERVISION.(Sterbenz, Christopher) (Entered:07/08/2011)

07/11/2011 38 ENTERED IN ERROR PER COUNSEL. . . ..Second MOTION to Compel Production of theComplete Administrative Record by UNITEDWESTERN BANK (Sandler, Andrew) Modifiedon 7/12/2011 (td, ). (Entered: 07/11/2011)

07/11/2011 39 Second MOTION to Compel Production of theComplete Administrative Record by UNITEDWESTERN BANK (Attachments: # 1Memorandum in Support of Second Motion toCompel Production of Administrative Record, # 2Exhibit, # 3 Text of Proposed Order)(Sandler,Andrew) (Entered: 07/11/2011)

07/12/2011 NOTICE of Hearing on Motion: 39 SecondMOTION to Compel Production of the CompleteAdministrative Record: Motion Hearing set for8/11/2011 10:00 AM in Courtroom 3 before JudgeAmy Berman Jackson. (jth) (Entered: 07/12/2011)

07/18/2011 41 Consent MOTION Consent Motion for Entry of aScheduling Order re 40 MOTION to Intervene byJOHN E. BOWMAN, OFFICE OF THRIFTSUPERVISION (Attachments: # 1 Text ofProposed Order)(Sterbenz, Christopher) (Entered:07/18/2011)

07/18/2011 42 MOTION for Leave to Appear Pro Hac Vice:Attorney Name− J. Carter Anderson, :Firm− BushRoss, P.A., :Address− 1801 N. Highland Avenue,Tampa, FL 33602. Phone No. − 813−224−9255.Fax No. − 813−223−9620 by LEGENTCLEARING, LLC (Attachments: # 1 Declaration,# 2 Text of Proposed Order)(Metz, Stephen)(Entered: 07/18/2011)

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07/18/2011 43 MOTION for Leave to Appear Pro Hac Vice:Attorney Name− Traci L. Koster, :Firm− BushRoss, P.A., :Address− 1801 N. Highland Avenue,Tampa, FL 33602. Phone No. − 813−224−9255.Fax No. − 813−223−9620 by LEGENTCLEARING, LLC (Attachments: # 1 Declaration,# 2 Text of Proposed Order)(Metz, Stephen)(Entered: 07/18/2011)

07/21/2011 MINUTE ORDER. Telephone Conferencescheduled for 7/25/2011 at 10:30 AM inCourtroom 3 before Judge Amy Berman Jackson.Signed by Judge Amy Berman Jackson on7/21/2011. (jth) (Entered: 07/21/2011)

07/25/2011 Minute Order. Telephone Conference held on7/25/2011 before Judge Amy Berman Jackson.Granting 40 Motion of Legent Clearing, LLC toIntervene for the limited purpose of the motion forprotective order. The Clerk is directed to file themotion for protective order that was attached as anexhibit to the motion to intervene. The parties aredirected to file a Joint Status Report by 8/26/2011regarding material to be redacted in the protectiveorder. (Court Reporter Wendy Ricard) (jth)(Entered: 07/25/2011)

07/25/2011 44 Consent MOTION to Substitute Party Office of theComptroller of the Currency and ActingComptroller John G. Walsh, vice Office of ThriftSupervision and Acting Director John E. Bowmanby JOHN E. BOWMAN, OFFICE OF THRIFTSUPERVISION (Attachments: # 1 Text ofProposed Order)(Sterbenz, Christopher) (Entered:07/25/2011)

07/25/2011 45 NOTICE of Change of Address by Christopher A.Sterbenz (Sterbenz, Christopher) (Entered:07/25/2011)

07/25/2011 MINUTE ORDER granting 42 Motion for Leaveto Appear Pro Hac Vice. Signed by Judge AmyBerman Jackson on 7/25/2011. (lcabj2) (Entered:07/25/2011)

07/25/2011 MINUTE ORDER granting 43 Motion for Leaveto Appear Pro Hac Vice. Signed by Judge AmyBerman Jackson on 7/25/2011. (lcabj2) (Entered:07/25/2011)

07/25/2011 46 NOTICE of Change of Address by Dirk S. Roberts(Roberts, Dirk) (Entered: 07/25/2011)

07/25/2011 MINUTE ORDER granting 44 Consent Motion toSubstitute Parties. The Office of the Comptroller of

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the Currency and Acting Comptroller of theCurrency, John G. Walsh are substituted for formerdefendants Office of Thrift Supervision and itsActing Director, John E. Bowman. Signed byJudge Amy Berman Jackson on 7/25/2011. (MT)(Entered: 07/25/2011)

07/25/2011 47 MOTION for Protective Order by LEGENTCLEARING, LLC (Attachments: # 1Memorandum in Support, # 2 Exhibit A, # 3Exhibit B, # 4 Text of Proposed Order)(jf, )(Entered: 07/26/2011)

08/01/2011 48 Memorandum in opposition to re 39 SecondMOTION to Compel Production of the CompleteAdministrative Record filed by OFFICE OF THECOMPTROLLER OF THE CURRENCY, JOHNG. WALSH. (Attachments: # 1 Declaration, # 2Text of Proposed Order)(Sterbenz, Christopher)(Entered: 08/01/2011)

08/08/2011 49 NOTICE of Firm Name Change by UNITEDWESTERN BANK (Behre, Kirby) (Entered:08/08/2011)

08/08/2011 50 REPLY to opposition to motion re 39 SecondMOTION to Compel Production of the CompleteAdministrative Record filed by UNITEDWESTERN BANK. (Sandler, Andrew) (Entered:08/08/2011)

08/09/2011 51 STRICKEN PURSUANT TO MINUTE ORDERFILED 08/10/2011.....Memorandum in oppositionto re 47 MOTION for Protective Order filed byFEDERAL DEPOSIT INSURANCECORPORATION. (Pardini, Merritt) Modified on8/10/2011 (jth). (Entered: 08/09/2011)

08/10/2011 MINUTE ORDER striking 51 Memorandum inopposition to re 47 MOTION for Protective Orderfiled by FEDERAL DEPOSIT INSURANCECORPORATION because it was filed by entitiesthat are no longer parties to the litigation, see Dkt.#32 &33. Further, in light of the Court's order onJuly 25, 2011, directing the parties to confer andprovide the Court with a more narrowly tailoredprotective order, it is moot. Signed by Judge AmyBerman Jackson on 8/10/2011. (lcabj2) (Entered:08/10/2011)

08/11/2011 Minute Entry for Proceedings that were held beforeJudge Amy Berman Jackson. Motions Hearingheld on 8/11/2011 re: 39 Second MOTION toCompel Production of the Complete Administrative

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Record filed by UNITED WESTERN BANK.Motion was Heard and Taken Under Advisement.(Court Reporter Lisa Schwam) (jth) (Entered:08/11/2011)

08/11/2011 MINUTE ORDER In connection with the Court'sconsideration of Plaintiff's Second Motion toCompel Production of the CompleteAdministrative Record, taken under advisementafter the hearing on the motion on August 11,2011, it is hereby ORDERED that on or beforeAugust 31, 2011: 1) The defendant John G. Walsh,Acting Comptroller of the Currency, shall certifythat the administrative record produced to theplaintiff, or the record as supplemented by anyadditional materials produced on or before the dateof the certification, is the accurate and completerecord of all of the information which the thenActing Director of the Office of Thrift Supervisionconsidered, directly or indirectly, or upon which herelied, in making the January 21, 2011 decision toappoint a receiver for United Western Bankpursuant to 12 USC 1464 (d)(2)(A); and 2)Plaintiff United Western Bank shall submit to theCourt a proposal detailing the scope of the limiteddiscovery it seeks to conduct to enable it touncover evidence relevant to the Court'sdetermination of whether grounds exist for anorder that the record be supplemented in this case,ie, whether documents that are properly part of theadministrative record have been withheld. Anyproposed discovery must be limited to requests forproduction of documents and interrogatories andshould be narrowly tailored to serve the rare andlimited circumstances under which discovery maybe granted in an Administrative Procedure Act casein this Circuit. Signed by Judge Amy BermanJackson on 8/11/2011. (lcabj2) (Entered:08/11/2011)

08/12/2011 Set/Reset Deadline: On or before 8/31/2011: 1)The defendant John G. Walsh, Acting Comptrollerof the Currency, shall certify that theadministrative record produced to the plaintiff, orthe record as supplemented by any additionalmaterials produced on or before the date of thecertification, is the accurate and complete record ofall of the information which the then ActingDirector of the Office of Thrift Supervisionconsidered, directly or indirectly, or upon which herelied, in making the January 21, 2011 decision toappoint a receiver for United Western Bank

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pursuant to 12 USC 1464 (d)(2)(A); and 2)Plaintiff United Western Bank shall submit to theCourt a proposal detailing the scope of the limiteddiscovery it seeks to conduct to enable it touncover evidence relevant to the Court'sdetermination of whether grounds exist for anorder that the record be supplemented in this case,ie, whether documents that are properly part of theadministrative record have been withheld. Anyproposed discovery must be limited to requests forproduction of documents and interrogatories andshould be narrowly tailored to serve the rare andlimited circumstances under which discovery maybe granted in an Administrative Procedure Act casein this Circuit. (jth) (Entered: 08/12/2011)

08/26/2011 52 STATUS REPORT by LEGENT CLEARING,LLC, OFFICE OF THE COMPTROLLER OFTHE CURRENCY, JOHN G. WALSH. (Sterbenz,Christopher) (Entered: 08/26/2011)

08/26/2011 MINUTE ORDER The parties are directed to fileanother joint status report regarding the motion forprotective order on or before September 12, 2011.Signed by Judge Amy Berman Jackson on8/26/2011. (lcabj2) (Entered: 08/26/2011)

08/26/2011 Set/Reset Deadlines: The parties are directed to fileanother joint status report regarding the motion forprotective order on or before 9/12/2011. (jth)(Entered: 08/31/2011)

08/30/2011 53 Consent MOTION for Extension of Time to Fileby OFFICE OF THE COMPTROLLER OF THECURRENCY, JOHN G. WALSH (Attachments: #1 Text of Proposed Order)(Sterbenz, Christopher)(Entered: 08/30/2011)

08/31/2011 MINUTE ORDER granting 53 Consent Motion forExtension of Time to 9/6/2011 to make thesubmissions required by the Court's order of8/11/2011. Signed by Judge Amy Berman Jacksonon 8/31/11. (MT) (Entered: 08/31/2011)

09/01/2011 54 RESPONSE TO ORDER OF THE COURT reOrder,,,,,, filed by OFFICE OF THECOMPTROLLER OF THE CURRENCY, JOHNG. WALSH. (Attachments: # 1 DeclarationDeclaration of John E. Bowman, # 2 DeclarationDeclaration of John G. Walsh)(Sterbenz,Christopher) (Entered: 09/01/2011)

09/01/2011 55 NOTICE of Filing of Plaintiff's DiscoveryProposal by UNITED WESTERN BANK re

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Order,,,,,, (Attachments: # 1 AppendixInterrogatories and Requests for Production ofDocuments)(Sandler, Andrew) (Entered:09/01/2011)

09/09/2011 56 ORDER on proposed discovery. Signed by JudgeAmy Berman Jackson on 9/9/2011. (lcabj2)(Entered: 09/09/2011)

09/12/2011 57 STATUS REPORT by LEGENT CLEARING,LLC, OFFICE OF THE COMPTROLLER OFTHE CURRENCY. (Sterbenz, Christopher)(Entered: 09/12/2011)

09/13/2011 MINUTE ORDER re 57 Status Report. In light ofthe joint status report, Legent shall notify the Courton or before 9/21/2011 whether its motion forprotective order should be denied as moot. Signedby Judge Amy Berman Jackson on 9/13/2011.(MT) (Entered: 09/13/2011)

09/13/2011 Set/Reset Deadlines: Legent shall notify the Courton or before 9/21/2011 whether its motion forprotective order should be denied as moot. (jth)(Entered: 09/13/2011)

09/21/2011 58 STATUS REPORT Regarding Legent Clearing,LLC's 47 Motion for Protective Order by LEGENTCLEARING, LLC. (Metz, Stephen) (Entered:09/21/2011)

09/21/2011 MINUTE ORDER denying 47 Motion forProtective Order as moot in light of the matterspresented by the parties in the status report dated9/21/2011. Defendant Office of Thrift Supervisionis directed to file the public version of theadministrative record on or before 10/5/2011.Signed by Judge Amy Berman Jackson on9/21/2011. (lcabj2) (Entered: 09/21/2011)

09/21/2011 Set/Reset Deadlines: Defendant is directed to filethe public version of the administrative record by10/5/2011. (jth) (Entered: 09/21/2011)

10/05/2011 59 ADMINISTRATIVE RECORD Notice of Filingby OFFICE OF THE COMPTROLLER OF THECURRENCY, JOHN G. WALSH. (Sterbenz,Christopher) (Entered: 10/05/2011)

10/11/2011 MINUTE ORDER Plaintiff is directed tosupplement its second motion to compelproduction of the complete administrative record[Dkt. #39] on or before November 11, 2011, byidentifying any particular material uncovered inaccordance with the Court's order on September 9,

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2011, regarding proposed discovery [Dkt. #56] thatshould be included in the administrative record butcurrently is not. If no supplementation is required,the Court will deem the motion to compel to bemoot. Signed by Judge Amy Berman Jackson on10/11/2011. (lcabj2) (Entered: 10/11/2011)

10/11/2011 Set/Reset Deadlines: Plaintiff is directed tosupplement its second motion to compelproduction of the complete administrative record[Docket #39], by identifying any particularmaterial uncovered in accordance with the Court'sorder on September 9, 2011, regarding proposeddiscovery [Docket #56] that should be included inthe administrative record but currently is not. If nosupplementation is required, the Court will deemthe motion to compel to be moot. Supplement dueby 11/11/2011. (jth) (Entered: 10/11/2011)

11/02/2011 60 Second MOTION to Compel Production of theComplete Administrative Record − Renewed byUNITED WESTERN BANK (Attachments: # 1Memorandum in Support, # 2 Exhibit1−5)(Sandler, Andrew) (Entered: 11/02/2011)

11/02/2011 61 SUPPLEMENTAL MEMORANDUM to re 60Second MOTION to Compel Production of theComplete Administrative Record − Renewed filedby UNITED WESTERN BANK. (Sandler,Andrew) Modified on 11/3/2011 to correct dockettext (jf, ). (Entered: 11/02/2011)

11/02/2011 62 LARGE ADDITIONAL ATTACHMENT(S) byUNITED WESTERN BANK 61 SupplementalMemorandum filed by UNITED WESTERNBANK. (Attachments: # 1 Exhibit)(Sandler,Andrew) (Entered: 11/02/2011)



11/03/2011 MINUTE ORDER granting 39 Motion to Compelin part and denying in part as moot since it hasbeen superseded by [Dkt. #60]. Signed by JudgeAmy Berman Jackson on 11/3/2011. (lcabj2)

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(Entered: 11/03/2011)

11/16/2011 65 Memorandum in opposition to re 60 SecondMOTION to Compel Production of the CompleteAdministrative Record − Renewed filed byOFFICE OF THE COMPTROLLER OF THECURRENCY, JOHN G. WALSH. (Sterbenz,Christopher) (Entered: 11/16/2011)

11/23/2011 66 REPLY to opposition to motion re 60 SecondMOTION to Compel Production of the CompleteAdministrative Record − Renewed filed byUNITED WESTERN BANK. (Sandler, Andrew)(Entered: 11/23/2011)

12/27/2011 67 TRANSCRIPT OF PROCEEDINGS before JudgeAmy Berman Jackson held on 8−11−2011; PageNumbers: 1−66. Court Reporter/Transcriber LisaSchwam, Telephone number 202−354−3238, CourtReporter Email Address : [email protected].


NOTICE RE REDACTION OFTRANSCRIPTS: The parties have twenty−onedays to file with the court and the court reporterany request to redact personal identifiers from thistranscript. If no such requests are filed, thetranscript will be made available to the public viaPACER without redaction after 90 days. Thepolicy, which includes the five personal identifiersspecifically covered, is located on our website atww.dcd.uscourts.gov.


12/28/2011 68 NOTICE OF WITHDRAWAL OFAPPEARANCE as to OFFICE OF THECOMPTROLLER OF THE CURRENCY, JOHNG. WALSH. Attorney Dirk S. Roberts terminated.(Roberts, Dirk) (Entered: 12/28/2011)

01/17/2012 69 NOTICE of Appearance by Gregory F. Taylor onbehalf of OFFICE OF THE COMPTROLLER OF

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THE CURRENCY, JOHN G. WALSH (Taylor,Gregory) (Entered: 01/17/2012)

01/19/2012 70 MOTION to Expedite Consideration of PendingMotion to Compel by UNITED WESTERN BANK(Attachments: # 1 Memorandum inSupport)(Sandler, Andrew) (Entered: 01/19/2012)

01/25/2012 71 ENTERED IN ERROR.....NOTICE Response byOFFICE OF THE COMPTROLLER OF THECURRENCY, JOHN G. WALSH re 70 MOTIONto Expedite Consideration of Pending Motion toCompel (Sterbenz, Christopher) Modified on1/25/2012 (jf, ). (Entered: 01/25/2012)

01/25/2012 NOTICE OF CORRECTED DOCKET ENTRY:Document No. re 71 Notice (Other) was entered inerror and counsel was instructed to refile saidpleading under the correct event. (jf, ) (Entered:01/25/2012)

01/25/2012 72 RESPONSE re 70 MOTION to ExpediteConsideration of Pending Motion to Compel filedby OFFICE OF THE COMPTROLLER OF THECURRENCY, JOHN G. WALSH. (Sterbenz,Christopher) (Entered: 01/25/2012)

02/01/2012 NOTICE of Hearing: Telephone Conferencescheduled for 2/7/2012 at 10:00 AM in Courtroom3 before Judge Amy Berman Jackson. (jth)(Entered: 02/01/2012)

02/07/2012 Minute Entry for proceedings held before JudgeAmy Berman Jackson: Telephone Conference heldon 2/7/2012. For the reasons stated on the record60 Motion to Compel is granted in part and deniedin part. Document production period to concludeby 3/7/2012; Joint Proposed briefing schedule dueby 3/9/2012. (Court Reporter PatKaneshiro−Miller) (jth) (Entered: 02/07/2012)

02/07/2012 MINUTE ORDER denying 70 Motion to Expediteas moot in light of the Court's ruling on Dkt. #60on February 7, 2012. Signed by Judge AmyBerman Jackson on 2/7/2012. (lcabj2) (Entered:02/07/2012)

02/09/2012 73 NOTICE of Proposed Order by UNITEDWESTERN BANK (Sandler, Andrew) (Entered:02/09/2012)

02/09/2012 74 ORDER re 60 Second MOTION to CompelProduction of the Complete Administrative Record− Renewed. The motion is granted in part anddenied in part. Counsel for the parties shall meet

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and confer and submit an agreed scheduling orderfor dispositive motions to the Court on or before3/9/2012. SEE ORDER FOR COMPLETEDETAILS. Signed by Judge Amy Berman Jacksonon 2/9/2012. (MT) (Entered: 02/09/2012)

02/10/2012 75 MOTION to Intervene on a Limited Basis toAddress Production of FDIC Documents byFEDERAL DEPOSIT INSURANCECORPORATION (Attachments: # 1 Exhibit A, # 2Exhibit B, # 3 Text of Proposed Order)(Stevens,Duncan) (Entered: 02/10/2012)

02/10/2012 MINUTE ORDER granting 75 the motion tointervene for the limited purpose of addressingproduction of FDIC documents. The Court deemsplaintiff's motion to compel as a request for awaiver pursuant to the regulations and orders FDICto either authorize defendant OCC to produce thedocuments to plaintiff or submit them in cameraitself to the Court by February 15, 2012. The Courtsuspends defendant OCC's obligation to producethose documents pursuant to the order issued onFebruary 7, 2012, until the Court has ruled on theFDIC's assertion of privilege. Signed by JudgeAmy Berman Jackson on 2/10/2012. (lcabj2)(Entered: 02/10/2012)

02/10/2012 Set/Reset Deadlines: FDIC is ordered to eitherauthorize defendant OCC to produce thedocuments to plaintiff or itself to submit them incamera to the Court by 2/15/2012. (jth) (Entered:02/10/2012)

02/15/2012 76 NOTICE of In Camera Production by FEDERALDEPOSIT INSURANCE CORPORATION reOrder on Motion to Intervene,, (Stevens, Duncan)(Entered: 02/15/2012)

02/15/2012 77 MOTION for Protective Order by FEDERALDEPOSIT INSURANCE CORPORATION(Attachments: # 1 Text of ProposedOrder)(Stevens, Duncan) (Entered: 02/15/2012)

02/15/2012 MINUTE ORDER While the Court is preparedotherwise to approve the proposed order to [Dkt. #77] MOTION for Protective Order, it will not signan order that provides, as in paragraphs 3 and 5,that any matters "shall" be filed under seal. Anyprotective order must be in accordance with thepresumption against sealed proceedings thatapplies in this Circuit and with LCvR 5.1(j). Theparties may submit another proposed order thatcomplies with these rules for the Court's approval.

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Signed by Judge Amy Berman Jackson on2/15/2012. (lcabj2) Modified on 2/15/2012 toreflect that the motion for proctective order was nota consent motion (jth). (Entered: 02/15/2012)

02/16/2012 78 RESPONSE re 76 Notice (Other) of in CameraProduction by Intervenor FDIC filed by UNITEDWESTERN BANK. (Sandler, Andrew) (Entered:02/16/2012)

02/17/2012 79 REPLY re 78 Response to Document Regarding InCamera Production of Documents filed byFEDERAL DEPOSIT INSURANCECORPORATION. (Attachments: # 1 Exhibit A:2−15−12 Letter to Court, # 2 Exhibit B:Defendants' Responses to Interrogatories)(Stevens,Duncan) (Entered: 02/17/2012)

02/24/2012 80 NOTICE Regarding Redacted Documents byFEDERAL DEPOSIT INSURANCECORPORATION (Stevens, Duncan) (Entered:02/24/2012)

02/24/2012 81 MEMORANDUM OPINION &ORDER regardingproduction of documents by defendant OCC. FDICis directed to submit a revised protective order forthe Court's signature on or before March 2, 2012.OCC is directed to notify the Court by March 2,2012 regarding whether it "directly or indirectlyconsidered, or relied upon" on the October 25,2010 Case Memorandum or whether it was simply"provided" to the Acting Director. See Order forcomplete details, including the Court's rulings onthe other documents at issue. Signed by JudgeAmy Berman Jackson on 2/24/2012. (lcabj2)Modified on 2/27/2012 to reflect the correct date ofOctober 25, 2010 (jth). (Entered: 02/24/2012)

02/27/2012 Set/Reset Deadlines: FDIC's Revised ProtectiveOrder and OCC's answer/response to the Court'sMemorandum Opinion and Order of 2/24/2012 aredue by 3/2/2012. (jth) (Entered: 02/27/2012)

03/01/2012 82 RESPONSE TO ORDER OF THE COURT re 81Memorandum &Opinion,, filed by OFFICE OFTHE COMPTROLLER OF THE CURRENCY,JOHN G. WALSH. (Sterbenz, Christopher)(Entered: 03/01/2012)

03/02/2012 83 Amended MOTION for Protective Order andMotion for Clarification by FEDERAL DEPOSITINSURANCE CORPORATION (Attachments: # 1Appendix Proposed Protective Order)(Stevens,Duncan). Added MOTION to Clarify on 3/5/2012

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(znmw, ). (Entered: 03/02/2012)

03/05/2012 84 RESPONSE re 82 Response to Order of the Courtfiled by UNITED WESTERN BANK. (Sandler,Andrew) (Entered: 03/05/2012)

03/06/2012 85 ENTERED IN ERROR.....MOTION forReconsideration re 81 Memorandum &Opinion,,by FEDERAL DEPOSIT INSURANCECORPORATION (Attachments: # 1 Text ofProposed Order)(Stevens, Duncan) Modified on3/7/2012 (jf, ). (Entered: 03/06/2012)

03/06/2012 86 Amended MOTION for Reconsideration re 81Memorandum &Opinion,, by FEDERALDEPOSIT INSURANCE CORPORATION(Attachments: # 1 Text of ProposedOrder)(Stevens, Duncan) (Entered: 03/06/2012)

03/06/2012 87 Memorandum in opposition to re 83 AmendedMOTION for Protective Order and Motion forClarification MOTION to Clarify filed byUNITED WESTERN BANK. (Attachments: # 1Text of Proposed Order)(Sandler, Andrew)(Entered: 03/06/2012)

03/07/2012 88 REPLY to opposition to motion re 83 AmendedMOTION for Protective Order and Motion forClarification MOTION to Clarify filed byFEDERAL DEPOSIT INSURANCECORPORATION. (Stevens, Duncan) (Entered:03/07/2012)

03/07/2012 NOTICE OF CORRECTED DOCKET ENTRY:Document No. re 85 MOTION for Reconsiderationre 81 Memorandum &Opinion,, was entered inerror and refiled by counsel. (See Docket Entry 86to view document)(jf, ) (Entered: 03/07/2012)

03/07/2012 89 PROTECTIVE ORDER (SEE ORDER FORCOMPLETE DETAILS). Signed by Judge AmyBerman Jackson on 3/6/2012. (jth) (Entered:03/07/2012)

03/09/2012 90 RESPONSE TO ORDER OF THE COURT re 74Order, Regarding Scheduling of DispositiveMotions filed by OFFICE OF THECOMPTROLLER OF THE CURRENCY, JOHNG. WALSH. (Attachments: # 1 Text of ProposedOrder)(Sterbenz, Christopher) (Entered:03/09/2012)

03/09/2012 91 RESPONSE TO ORDER OF THE COURT re 74Order, Regarding Scheduling of DispositiveMotions filed by UNITED WESTERN BANK.

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(Sandler, Andrew) (Entered: 03/09/2012)

03/09/2012 92 RESPONSE re 91 Response to Order of the Courtfiled by OFFICE OF THE COMPTROLLER OFTHE CURRENCY, JOHN G. WALSH. (Sterbenz,Christopher) (Entered: 03/09/2012)

03/13/2012 93 Memorandum in opposition to re 86 AmendedMOTION for Reconsideration re 81 Memorandum&Opinion,, filed by UNITED WESTERN BANK.(Sandler, Andrew) (Entered: 03/13/2012)

03/14/2012 94 REPLY to opposition to motion re 86 AmendedMOTION for Reconsideration re 81 Memorandum&Opinion,, filed by FEDERAL DEPOSITINSURANCE CORPORATION. (Stevens,Duncan) (Entered: 03/14/2012)

03/14/2012 95 AMENDED SCHEDULING ORDER: Plaintiff'smotion for summary judgment will be due4/20/2012. Defendants' opposition and crossmotion for summary judgment will be due5/18/2012. Plaintiff's combined reply andopposition to the cross motion for summaryjudgment will be due 6/8/2012. Defendants' replyto the opposition to the cross motion for summaryjudgment will be due 6/15/2012. SEE ORDERFOR COMPLETE DETAILS. Signed by JudgeAmy Berman Jackson on 3/14/2012. (MT)(Entered: 03/14/2012)

04/04/2012 96 MEMORANDUM OPINION AND ORDERgranting 86 Motion for Reconsideration. It isordered that defendant need not produce the CostTest Summary. It is further ordered that defendantneed not produce the Case Memorandum to theFDIC Board dated October 25, 2010. See order fordetails. Signed by Judge Amy Berman Jackson on4/4/2012. (lcabj2) (Entered: 04/04/2012)

04/05/2012 97 NOTICE of Appearance by Michael Ray Williamson behalf of UNITED WESTERN BANK(Williams, Michael) (Entered: 04/05/2012)

04/17/2012 98 Consent MOTION to Substitute Party by OFFICEOF THE COMPTROLLER OF THECURRENCY, JOHN G. WALSH (Attachments: #1 Text of Proposed Order)(Sterbenz, Christopher)(Entered: 04/17/2012)

04/18/2012 MINUTE ORDER granting 98 Consent Motion toSubstitute Parties. THOMAS J. CURRY,Comptroller of the Currency, is substituted as aparty defendant for JOHN G. WALSH the formerActing Comptroller of the Currency. Signed by

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Judge Amy Berman Jackson on 4/18/2012. (jth)(Entered: 04/18/2012)

04/20/2012 99 MOTION for Summary Judgment by UNITEDWESTERN BANK (Attachments: # 1 Text ofProposed Order)(Sandler, Andrew) (MainDocument 99 replaced on 12/6/2012) (zjth, ).(Entered: 04/20/2012)

05/18/2012 100 MOTION for Summary Judgment andMemorandum of Points and Authorities inOpposition to Plaintiff's Motion for SummaryJudgment by THOMAS J. CURRY, OFFICE OFTHE COMPTROLLER OF THE CURRENCY(Attachments: # 1 Memorandum in Support, # 2Statement of Facts)(Sterbenz, Christopher)(Entered: 05/18/2012)

05/21/2012 101 Memorandum in opposition to re 99 MOTION forSummary Judgment in duplicate of that filed insupport of Defendant's May 18, 2012 motion forsummary judgment filed by THOMAS J. CURRY,OFFICE OF THE COMPTROLLER OF THECURRENCY. (Sterbenz, Christopher) (Entered:05/21/2012)

05/22/2012 102 MOTION to Strike 100 MOTION for SummaryJudgment and Memorandum of Points andAuthorities in Opposition to Plaintiff's Motion forSummary Judgment (Particularly [100−2]Separate Statement of Facts) by UNITEDWESTERN BANK (Attachments: # 1 Text ofProposed Order)(Sandler, Andrew) (Entered:05/22/2012)

05/29/2012 103 Memorandum in opposition to re 102 MOTION toStrike 100 MOTION for Summary Judgment andMemorandum of Points and Authorities inOpposition to Plaintiff's Motion for SummaryJudgment (Particularly [100−2] SeparateStatement of Facts) MOTION to Strike 100MOTION for Summary Judgment andMemorandum of Points and Authorities inOpposition to Plaintiff's Motion for SummaryJudgment (Particularly [100−2] SeparateStatement of Facts) filed by THOMAS J. CURRY,OFFICE OF THE COMPTROLLER OF THECURRENCY. (Sterbenz, Christopher) (Entered:05/29/2012)

05/30/2012 104 REPLY to opposition to motion re 102 MOTIONto Strike 100 MOTION for Summary Judgmentand Memorandum of Points and Authorities inOpposition to Plaintiff's Motion for Summary

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Judgment (Particularly [100−2] SeparateStatement of Facts filed by UNITED WESTERNBANK. (Williams, Michael) . (Entered:05/30/2012)

06/08/2012 105 Memorandum in opposition to re 100 MOTION forSummary Judgment and Memorandum of Pointsand Authorities in Opposition to Plaintiff's Motionfor Summary Judgment filed by UNITEDWESTERN BANK. (Sandler, Andrew) (MainDocument 105 replaced on 12/6/2012) (zjth, ).(Entered: 06/08/2012)

06/08/2012 106 REPLY to opposition to motion re 99 MOTIONfor Summary Judgment filed by UNITEDWESTERN BANK. (Sandler, Andrew) (MainDocument 106 replaced on 12/6/2012) (zjth, ).(Entered: 06/08/2012)

06/15/2012 107 REPLY to opposition to re 100 MOTION forSummary Judgment filed by THOMAS J. CURRY,OFFICE OF THE COMPTROLLER OF THECURRENCY. (Sterbenz, Christopher) . (Entered:06/15/2012)

06/19/2012 108 MOTION for Oral Argument in resolving pendingmotions by UNITED WESTERN BANK (Sandler,Andrew) Modified on 6/20/2012 (jf, ). (Entered:06/19/2012)

06/20/2012 109 RESPONSE re 108 Notice (Other) filed byTHOMAS J. CURRY, OFFICE OF THECOMPTROLLER OF THE CURRENCY.(Sterbenz, Christopher) (Entered: 06/20/2012)

06/20/2012 MINUTE ORDER denying as moot 108 Motionfor Oral Argument. The Court is aware of thependency of these motions as well as the manyother motions on its docket, and it will scheduleargument if and when it determines that it will benecessary to the resolution of the issues. The Courthopes that plaintiff's counsel will enjoy a completerecovery, and it wishes to assure him that anyhearing will be set on a date that accommodates hisschedule. Signed by Judge Amy Berman Jacksonon 6/20/2012. (MT) (Entered: 06/20/2012)

06/20/2012 NOTICE OF ERROR re 108 Motion forMiscellaneous Relief; emailed [email protected], cc'd 18 associatedattorneys −− The PDF file you docketed containederrors: 1. FYI − Counsel should refrain from usingAll Caps to e−file (jf, ) (Entered: 06/20/2012)

06/29/2012 110

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NOTICE of Filing of Appendix by UNITEDWESTERN BANK re 59 Administrative Record(Attachments: # 1 Appendix 1, # 2 Appendix 2, # 3Appendix 3, # 4 Appendix 4, # 5 Appendix 5, # 6Appendix 6, # 7 Appendix 7, # 8 Appendix 8, # 9Appendix 9, # 10 Appendix 10, # 11 Appendix 11,# 12 Appendix 12, # 13 Appendix 13, # 14Appendix 14, # 15 Appendix 15, # 16 Appendix16, # 17 Appendix 17, # 18 Appendix 18, # 19Appendix 19, # 20 Appendix 20, # 21 Appendix21, # 22 Appendix 22, # 23 Appendix 23, # 24Appendix 24, # 25 Appendix 25, # 26 Appendix26, # 27 Appendix 27, # 28 Appendix 28, # 29Appendix 29, # 30 Appendix 30, # 31 Appendix31, # 32 Appendix 32, # 33 Appendix 33, # 34Appendix 34, # 35 Appendix 35, # 36 Appendix36, # 37 Appendix 37, # 38 Appendix 38, # 39Appendix 39, # 40 Appendix 40, # 41 Appendix41, # 42 Appendix 42, # 43 Appendix 43, # 44Appendix 44, # 45 Appendix 45, # 46 Appendix46, # 47 Appendix 47, # 48 Appendix 48, # 49Appendix 49, # 50 Appendix 50, # 51 Appendix51, # 52 Appendix 52, # 53 Appendix 53, # 54Appendix 54, # 55 Appendix 55, # 56 Appendix56, # 57 Appendix 57, # 58 Appendix 58, # 59Appendix 59, # 60 Appendix 60, # 61 Appendix61, # 62 Appendix 62, # 63 Appendix 63, # 64Appendix 64, # 65 Appendix 65, # 66 Appendix66, # 67 Appendix 67, # 68 Appendix 68, # 69Appendix 69)(Williams, Michael) (Entered:06/29/2012)

09/28/2012 NOTICE of Hearing on Motions: 100 Defendants'MOTION for Summary Judgment; 99 Plaintiff'sMOTION for Summary Judgment; and 102Plaintiff's MOTION to Strike Defendants'Statement of Facts with References to theAdministrative Record. Motions Hearing isscheduled for 11/14/2012 at 10:00 AM inCourtroom 3 before Judge Amy Berman Jackson.(jth) (Entered: 09/28/2012)

11/08/2012 MINUTE ORDER. In its opposition to plaintiff'smotion for summary judgment, defendantrepeatedly cites to its statement of facts ("OCCSOF") rather than to the relevant pages in theadministrative record. So, before it can review anycited materials of interest, the Court must firstundertake the exercise of locating the citedparagraph in the OCC SOF before it can then trackdown the reference in the record. To facilitate itsconsideration of this matter, and without

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expressing any opinion on the ultimate outcome ofthe motion to strike, the Court hereby ORDERSdefendant to file, by 5:00 p.m. on Friday,November 9, a revised version of its oppositionsubstituting record citations for the citations to theOCC SOF. Signed by Judge Amy Berman Jacksonon 11/8/2012. (lcabj2) (Entered: 11/08/2012)

11/08/2012 MINUTE ORDER. Plaintiff has made the stylisticchoice of placing all legal citations in footnotes,rather than in the body of its memoranda. Puttingaside the question of whether the Court actuallyfinds this to be helpful, for the Court'sconvenience, it would greatly appreciate receivinga PDF version of plaintiff's two summary judgmentmemoranda with the footnotes in 12 point font.Plaintiff should send the revised memoranda to theCourt's ECF email inbox([email protected]) by 5:00 p.m. onThursday, November 8. Signed by Judge AmyBerman Jackson on 11/8/2012. (lcabj2) (Entered:11/08/2012)

11/08/2012 Set/Reset Hearings: The Motions Hearing that ispresently scheduled for 11/14/2012 at 10:00 AM isrescheduled for 11/20/2012 at 10:00 AM inCourtroom 3 before Judge Amy Berman Jackson.(jth) (Entered: 11/08/2012)

11/08/2012 Set/Reset Deadlines: Plaintiff to file revisedmemoranda in 12 point font by 5:00 PM onThursday, 11/8/2012. Defendant to file by 5:00 PMon Friday, 11/9/2012, a revised version of itsopposition substituting record citations for thecitations to the OCC SOF. (jth) (Entered:11/08/2012)

11/09/2012 111 NOTICE of Filing of Memorandum of Points andAuthorities with References to AdministrativeRecord by OFFICE OF THE COMPTROLLER OFTHE CURRENCY re Order,,, (Sterbenz,Christopher) (Entered: 11/09/2012)

11/20/2012 Minute Entry for proceedings held before JudgeAmy Berman Jackson: Motion Hearing held on11/20/2012 re 99 MOTION for SummaryJudgment filed by UNITED WESTERN BANK,100 MOTION for Summary Judgment andMemorandum of Points and Authorities inOpposition to Plaintiff's Motion for SummaryJudgment filed by THOMAS J. CURRY, OFFICEOF THE COMPTROLLER OF THECURRENCY. Motions heard and taken under

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advisement. (Court Reporter Kellie M. Humiston.)(ldc, ) (Entered: 11/20/2012)

01/30/2013 112 TRANSCRIPT OF PROCEEDINGS before JudgeAmy Berman Jackson held on 11−20−12; PageNumbers: 1 − 86. Court Reporter/TranscriberKellie Humiston, Telephone number202−354−3187, Court Reporter Email Address :[email protected].For the first90 days after this filing date, the transcript may beviewed at the courthouse at a public terminal orpurchased from the court reporter referencedabove. After 90 days, the transcript may beaccessed via PACER. Other transcript formats,(multi−page, condensed, CD or ASCII) may bepurchased from the court reporter.NOTICERE REDACTION OF TRANSCRIPTS: Theparties have twenty−one days to file with the courtand the court reporter any request to redactpersonal identifiers from this transcript. If no suchrequests are filed, the transcript will be madeavailable to the public via PACER withoutredaction after 90 days. The policy, which includesthe five personal identifiers specifically covered, islocated on our website atww.dcd.uscourts.gov. Redaction Requestdue 2/20/2013. Redacted Transcript Deadline setfor 3/2/2013. Release of Transcript Restriction setfor 4/30/2013.(Humiston, Kellie) (Entered:01/30/2013)

03/05/2013 113 36 ORDER denying 99 Motion for SummaryJudgment; granting 100 Motion for SummaryJudgment. See order for details. Signed by JudgeAmy Berman Jackson on 3/5/2013. (lcabj2)(Entered: 03/05/2013)

03/05/2013 114 37 MEMORANDUM OPINION. Signed by JudgeAmy Berman Jackson on 3/5/2013. (lcabj2)(Entered: 03/05/2013)

03/05/2013 MINUTE ORDER denying as moot 102 Motion toStrike. In light of the Memorandum Opinion issuedon this date, which relies solely on theadministrative record, and the Court's November 8,2012 minute order directing defendants to submit arevised version of their opposition substitutingrecord citations for the citations to their statementof facts, the Court will deny plaintiff's motion tostrike as moot. Signed by Judge Amy BermanJackson on 3/5/2013. (lcabj2) (Entered:03/05/2013)

32

04/26/2013 115 34 NOTICE OF APPEAL TO DC CIRCUIT COURTas to 113 Order on Motion for Summary Judgment,by UNITED WESTERN BANK. Filing fee $ 455,receipt number 0090−3298444. Fee Status: FeePaid. Parties have been notified. (Williams,Michael) (Entered: 04/26/2013)

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1

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

_______________________________________ ) UNITED WESTERN BANK, ) ) Plaintiff, ) )

v. ) ) OFFICE OF THE COMPTROLLER )OF THE CURRENCY, et al., ) ) Defendants. ) _______________________________________)

1:11-cv-00408 The Honorable Amy Berman Jackson

NOTICE OF APPEAL

Notice is hereby given that Plaintiff United Western Bank appeals to the U.S. Court of

Appeals for the District of Columbia from this Court’s judgment—entered March 5, 2013—

denying Plaintiff’s motion for summary judgment and granting Defendants’ motion for summary

judgment.

Respectfully submitted,

/s/ Andrew L. Sandler . Andrew L. Sandler (DC Bar No. 387825) Samuel J. Buffone (DC Bar No. 161828) Liana R. Prieto (DC Bar No. 987287) Michael R. Williams (DC Bar No. 994953) BUCKLEYSANDLER LLP 1250 24th St., NW, Suite 700 Washington, DC 20037 (202) 349-8001 (Telephone) (202) 349-8080 (Facsimile) Attorneys for Plaintiff United Western Bank

Dated: April 26, 2013

Case 1:11-cv-00408-ABJ Document 115 Filed 04/26/13 Page 1 of 2

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2

CERTIFICATE OF SERVICE

I hereby certify that on this 26th day of April 2013 a true copy of the foregoing was filed

electronically. Notice of this filing will be sent by email to all parties by operation of the Court’s

electronic filing system. Parties may also access this filing through the Court’s electronic filing

system.

/s/ Michael R. Williams

Michael R. Williams


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____________________________________ )

UNITED WESTERN BANK, ) )

Plaintiff, ) )

v. ) Civil Action No. 11-0408 (ABJ) )

OFFICE OF THE COMPTROLLER OF ) THE CURRENCY, et al., ) )

) Defendants. )

____________________________________)

ORDER

Pursuant to Fed. R. Civ. P. 58 and for the reasons stated in the accompanying

Memorandum Opinion, it is hereby ORDERED that plaintiff’s motion for summary judgment

[Dkt. # 99] is DENIED and defendants’ motion for summary judgment [Dkt. #100] is

GRANTED. This is a final appealable order.

AMY BERMAN JACKSON United States District Judge

DATE: March 5, 2013


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____________________________________ )

UNITED WESTERN BANK, ) )

Plaintiff, ) )

v. ) Civil Action No. 11-0408 (ABJ) )

OFFICE OF THE COMPTROLLER OF ) THE CURRENCY, et al., ) )

) Defendants. )

____________________________________)

MEMORANDUM OPINION

The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”)

grants the Director of the Office of Thrift Supervision (“OTS” or “the agency”) “exclusive power

and jurisdiction” to appoint a receiver or conservator for a savings association “if the Director

determines, in the Director’s discretion, that 1 or more of the grounds specified in section

1821(c)(5) of this title exists.” 12 U.S.C. § 1464(d)(2)(A)–(B) (2006) (amended July 21, 2011).

Although the agency’s decision to appoint a receiver is highly discretionary, it is not immune

from judicial review. In the event of the appointment of a receiver, “the association may, within

30 days thereafter, bring an action . . . in the United States District Court for the District of

Columbia, for an order requiring the Director to remove such conservator or receiver.” Id. §

1464(d)(2)(B).

In this case, plaintiff United Western Bank (“the Bank” or “the association”) asks the

Court to set aside the January 21, 2011 decision by the Acting Director of OTS to appoint the

Federal Deposit Insurance Corporation (“FDIC”) as receiver for the Bank. Compl. [Dkt. # 1] ¶

1; see also United Western Bank’s Mot. for Summ. J. (“Pl.’s Mot.”) [Dkt. # 99] at 1. The Bank


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2

has moved for summary judgment contending that OTS’s appointment decision should be

overturned because it “was arbitrary, capricious, an abuse of discretion, and not in accordance

with FIRREA’s requirements.” See Mem. in Supp. of Pl.’s Mot. for Summ. J. (“Pl.’s Mem.”)

[Dkt. # 99] at 2.

Defendants – the Office of the Comptroller of the Currency (“OCC”) and Thomas Curry,

Comptroller of the Currency – oppose the motion, and they have filed their own cross-motion for

summary judgment. They assert that placing the Bank into receivership was a proper exercise of

discretion under the FIRREA because the Acting Director’s decision was based on three

independent statutory grounds and supported by the administrative record. Defs.’ Mem. in Supp.

of their Mot. for Summ. J. and in Opp. to Pl.’s Mot. for Summ. J. (“Defs.’ Mem.”) [Dkt. # 111]

at 1, 9. Because the Court finds that the Bank has failed to show that OTS’s decision was

arbitrary or capricious, the Court will deny the Bank’s motion and grant defendants’ cross-

motion.

The Bank contends that it was not “necessary” for the agency to take the drastic step of

placing the Bank into receivership on the date that the Acting Director issued his decision. Tr.

[Dkt. # 112] 26:8–12. But that is not the proper inquiry. The law does not invite the Court to

make its own judgment about whether it would have been feasible, appropriate, or even

preferable, for the agency to wait; the sole question presented by this case is whether the agency

action was unreasonable.

In forcefully worded pleadings, the Bank passionately insists that the agency’s attitude

took a “sudden” and inexplicable turn in December of 2011, and that the regulators surprised the

bank with unrealistic deadlines and unnecessary requirements. Pl.’s Mem. at 36–37; Reply in

Supp. of Pl.’s Mot. for Summ. J. (“Pl.’s Reply”) [Dkt. # 106] at 5. But any change in the


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3

regulators’ approach was prompted by the seismic changes in the nation’s economy, and more

particularly, by the ongoing and significant deterioration of the Bank’s financial condition. The

review of the administrative record in its entirety reveals that the agency’s decision was the

culmination of a steady progression and not, as the Bank would have the Court conclude, a

sudden wrenching of gears. In early to mid-2009, the Bank had begun to suffer substantial

losses, and the agency began voicing concerns about the adequacy of the Bank’s capitalization,

its reliance on institutional investors, its liquidity, and its investment in mortgage-backed

securities. The same concerns that led to the receivership were the focus of a 2009 Report of

Examination, a Memorandum of Understanding between the Bank and the agency entered into in

December of 2009, a January 2010 examination, and even a cease and desist order agreed to by

the Bank in June of 2010. The Bank emphasizes that the record is devoid of evidence of

criminal activity or malfeasance on the part of the Bank’s managers, and the Court has little

doubt that they sincerely believed in their ability to save the institution until the moment the door

was closed. But the absence of those factors cannot alter the result compelled by the review of

the record under the deferential standard the Court is required to apply.

BACKGROUND

United Western Bank is a federally chartered savings association under 12 U.S.C. §

1464(a)(2) that was wholly owned by United Western Bancorp, Inc. (“the holding company”) at

all times relevant to this case. Administrative Record (“AR”) 11. With primary operations in

Colorado, the Bank originated construction, land, commercial real estate, and non-mortgage

commercial loans, maintained a large portfolio of non-agency mortgage-backed securities, and


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4

relied on institutional custodial deposits as its primary source of funding.1 AR 11, 23. The

Bank’s largest institutional depositors were: Equity Trust Company (“ETC”), Matrix Settlement

and Clearing Services, LLC (“MSCS”), Legent Clearing, and Lincoln Trust Company (“LTC”).

AR 32.

During the relevant period, the Office of Thrift Supervision was the primary regulator

for savings associations, and as such, was responsible for their “examination, safe and sound

operation, and regulation.” 12 U.S.C. § 1463(a)(1) (2006) (amended July 21, 2011);2 see also 12

C.F.R. § 563.170(a) (requiring OTS to periodically examine savings associations). During its

examinations, OTS evaluated the financial health of savings associations using a variety of

metrics. The agency rated the associations’ Capital, Asset Quality, Management, Earnings,

Liquidity, and Sensitivity to Market Risk (“CAMELS”) on a scale of one to five with one being

the best rating. See AR 22 n.1, 100. Banks received a separate rating for each of the CAMELS

categories as well as a composite CAMELS rating reflecting the bank’s overall condition. See,

e.g., United Western Bank 2007 Report of Examination, AR 55. In addition to the CAMELS

rating, OTS also classified the adequacy of a bank’s capital according to the Federal Deposit

Insurance Corporation Improvement Act of 1991 (the “FDICIA”), a portion of which was later

codified at 12 U.S.C. § 1831o, and is commonly known as the Prompt Corrective Action

(“PCA”) statute. The PCA divides bank capital levels into five different categories, ranging

1 According to the Bank, these institutional depositors “are trust companies and settlement companies that provide significant and regulated trust or brokerage services to millions of customers. As a byproduct of their primary business activities, the Institutional Depositors regularly handle idle customer funds that are in transit to or from external investments or are awaiting distribution. The Institutional Depositors place these funds on deposit at omnibus deposit accounts at the Bank during these transitory periods.” United Western Bank Request for Review of Material Supervisory Determination, AR 1760. 2 On July 21, 2011, OTS became part of OCC. OCC currently regulates both national banks and federal savings associations. 12 U.S.C. § 5412.


40



5

from “well capitalized” to “critically undercapitalized.” 12 U.S.C. § 1831o(b)(1). Negative

ratings under these metrics can expose a bank to certain statutorily mandated regulatory

responses.

The administrative record in this case confirms that prior to early 2009, the Bank enjoyed

“an unbroken 16 years of profitability” and correspondingly high CAMELS and PCA capital

ratings. AR 1474. As a result of the global financial crisis, the Bank’s earnings, asset quality,

and capital ratios deteriorated, and one of its largest sources of liquidity began withdrawing its

funds. AR 11–12, 2475. The Bank based its hope for survival on the consummation of a highly

contingent private sector recapitalization plan. AR 972–1091. The plan depended upon the

agency’s agreement to lift certain requirements it had previously imposed, AR 1185–90, but the

agency declined to do so, AR 4. Ultimately, the agency determined that there were three

statutory grounds supporting placing the Bank into receivership. AR 5–7; see also

Recommendation for Appointment of the Federal Deposit Insurance Corporation (FDIC) as

Receiver for United Western Bank, (“S-Memo”), AR 21–44. Based on this recommendation, on

January 21, 2011, the Acting Director of OTS appointed the FDIC as a receiver for the Bank

pursuant to 12 U.S.C. § 1464(d)(2)(A). AR 2–8.

The chronology of the events that led to the imposition of the receivership is as follows:

I. October 2007 OTS Examination

Between October 2007 and January 2008, OTS conducted a comprehensive risk-focused

examination of the Bank’s operations during the fifteen-month period ending on June 30, 2007.

AR 51–52, 55. The 2007 Report of Examination (“2007 ROE”) was overall positive. In the

report, the OTS examiners concluded that the Bank’s asset quality, earnings, and liquidity

sources were satisfactory, and they gave the Bank a CAMELS composite rating of 2, which


41



6

meant that the Bank was “fundamentally sound[,] . . . stable and . . . capable of withstanding

business fluctuations.” AR 56–57, 60, 100. The report also noted that as of June 30, 2007,

approximately 73% of the Bank’s total deposits were attributable to four institutional depositors.

AR 81. Although the agency cautioned that the Bank “continue[d] to face risk from its

concentration in institutional deposits,” it tempered this statement by concluding that the Bank’s

continued efforts to increase its retail deposits and its “contractual agreements with some of the

largest of these depositors help[ed] protect the institution’s liquidity position.” AR 57.

Additionally, the OTS examiners stated that although the Bank was “well capitalized” under

PCA standards, it had to “remain cognizant” of its concentration in institutional deposits and

“continue to maintain a prudent level of capital above the ‘well capitalized’ standards.”3 AR 56.

II. March 2009 OTS Examination

OTS’s next examination of the Bank occurred during the financial crisis; it began on

March 30, 2009, and covered the twenty-six month period ending in mid-September 2009. AR

130–31, 134. As the 2009 Report of Examination explained, “the review period saw

unprecedented declines in real estate markets, a changing economic environment, and dislocation

in capital markets.” AR 135. These poor and uncertain market conditions adversely impacted

certain aspects of the Bank’s operations. AR 135. The report specified that the Bank’s “asset

quality ha[d] deteriorated” due, in part, to losses on its mortgage-backed securities, and its

earnings had declined due to a $4.1 million write-down on two mortgage-backed securities. AR

3 On June 30, 2007, the Bank had a 14.38% Total Risk-Based capital ratio and a 13.69% Tier 1 (Core) Risk-Based capital ratio. AR 60. Under the PCA, an institution is “well capitalized” if it has a total risk-based capital ratio of 10.0% or higher, has a Tier 1 risk-based capital ratio of 6.0% or higher, a leverage ratio of 5.0% or higher, and is not subject to an OTS directive to meet and maintain a specific capital level. 12 C.F.R. § 565.4(b).


42



7

135–36. The OTS examiners added that any further deterioration of the Bank’s mortgage-

backed securities portfolio presented additional risks to its earnings. AR 136.

The examiners also noted that their concerns about the Bank’s liquidity sources and

capital levels had escalated due to the Bank’s deteriorating condition.

Capital: The report concluded that the Bank’s capital – which had declined to just above the “well capitalized” PCA level – was “less than satisfactory” because it did not fully support the Bank’s risk profile. AR 141. Specifically, the OTS examiners warned that “capital levels remain a concern due to risks posed by the bank’s remaining non-agency MBS portfolio and negative asset quality trends.” AR 142–43. According to the report, the Bank’s management was aware of the need to bolster the capital position and was pursuing various options to maintain a prudent level of capital above the PCA “well capitalized” standard. AR 135, 143.

Liquidity: The report also stated that the agency’s “[l]iquidity risk concerns ha[d] been elevated” due to the Bank’s continued overreliance on institutional deposits. AR 136. As of March 31, 2009, institutional deposits represented 86.9% of the Bank’s total deposits. AR 160. A third of these depositors could withdraw their deposits at any time because they had no contractual agreements with the Bank. AR 161. The remaining two-thirds had contractual agreements with the Bank that allowed them to withdraw their funds in a variety of circumstances, including a decline of the Bank’s capital to below “well capitalized” levels. AR 161. OTS then concluded that the “termination of one or more of the larger institutional deposit relationships could place UWB in a precarious liquidity position, as it may not be able to find replacement funding on reasonable terms.” AR 161.

In light of the problems and risks uncovered in the examination, OTS downgraded the Bank to a

CAMELS composite rating of 3, which meant that the Bank had “a combination of weaknesses

that may range from moderate to severe” and required “more than normal supervision.” AR 100,

134.

As part of the 2009 ROE, the agency also required the Bank to take remedial actions: (1)

to increase core and total risk-based capital ratios from 9.07% and 10.17% to at least 8.0 and

12.0% by December 31, 2009; (2) to “[d]evelop a revised comprehensive concentration policy

that sets limits . . . for the bank’s funding sources, including exposures to institutional

depositors”; and (3) to “[p]rovide a Liquidity Contingency Plan that contains specific board


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8

strategies for ensuring that the Bank maintains adequate short-term and long-term liquidity to

withstand any anticipated or extraordinary demand against its funding base.” AR 139–40.

After the issuance of the March 2009 ROE, the Bank’s financial condition worsened; it

lost a total of over $69 million during the year, and its capital ratios continued to decline. AR

865–66, 2475–76. As a result of the Bank’s losses and declining capital, on December 10, 2009,

OTS and the Bank signed a Memorandum of Understanding (“MOU”) in which the Bank again

pledged to fulfill the remedial measures set forth in the 2009 ROE. AR 220–34. Specifically,

the Bank agreed to raise its capital ratio levels to 12% and 8% by June 30, 2010, AR 220, and to

develop a liquidity contingency plan that “specifically address[ed] deposit concentrations and

plans to reduce or manage such concentrations,” AR 223–24.

III. January 2010 OTS Examination

As the financial crisis raged on, the Bank reported a loss of $21.02 million for the quarter

ending on March 31, 2010. AR 865–66. In April of 2010, OTS sent a letter to the Bank

summarizing the results of the agency’s January 2010 limited examination of the Bank. AR

267–69. In the letter, the agency expressed serious concerns about the Bank’s capital levels and

its continued concentration in institutional deposits. AR 267–69.4

Capital: In the letter, the agency explained that the Bank’s capital rating had “been downgraded given current risks to capital posed by the bank’s worsening asset quality trends, the potential impact of future [write-downs] from the bank’s remaining relatively large portfolio of below investment grade MBS, and deteriorating earnings.” AR 267. Additionally, the agency explained that revised calculations performed by the Bank during the January 2010 field visit required the Bank to take an $18 million write-down for the 2009 year-end, which reduced the Bank’s total risk-based and core capital ratios to 10.07% and 7.68% respectively. AR 267–68. Although these capital levels were still above the “well capitalized” PCA standard,

4 The Court will refrain from summarizing or quoting language from the January 2010 Report of Examination because OTS has been unable to confirm whether the report was mailed to the Bank. Defs.’ Opp. to Pl.’s Mot. to Supplement the Admin. R. at 7 [Dkt. # 48]. However, the Bank does not dispute that it received the April 2010 letter. Id.


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9

they were below the levels required by the MOU and the agency expressed concern that the Bank may not be able to meet and maintain the capital levels required by the MOU by the June 30, 2010 deadline. AR 268.

Liquidity: The agency also stated that “liquidity risk at UWB ha[d] increased and [was] of heightened concern” because of the “Bank’s significant concentration in institutional deposits.” AR 267. The letter explained that this concentration was particularly problematic because the FDIC was reviewing whether these deposits were “brokered.”5 If the FDIC concluded that the institutional deposits were all brokered, the Bank would not be able to accept or renew any such brokered deposits without a waiver from the FDIC once the Bank was officially deemed “Adequately Capitalized.” AR 267. The letter then noted that the agency had already informed the Bank that it would be deemed “adequately capitalized” in the near term,6 and directed the Bank to “consider all strategic alternatives available, including the possible sale, merger, or self-liquidation of United Western, to prevent the potential failure of the institution due to insufficient liquidity.” AR 267, 269.

OTS’s concerns about the “brokered” status of the institutional deposits materialized on

May 24, 2010. On that day, the FDIC notified the Bank that it had concluded that seven of the

Bank’s institutional depositors, including ETC – the Bank’s largest depositor – were “deposit

brokers” and that the Bank’s “adequately capitalized” status precluded it from accepting,

renewing, or rolling over any brokered deposits without a waiver from the FDIC. AR 369–80.

In response, the Bank filed a request for a waiver from the FDIC on June 10, 2010, AR 690, and

it modified its depositor contracts in an attempt to place them within an exception to the

“brokered deposit” designation, AR 1558. On June 22, 2010, OTS sent a letter to the Bank

stating that in light of the uncertainty as to whether the FDIC would grant a waiver and the

Bank’s failure to demonstrate its ability to replace the institutional deposits in the near future, the

Bank could “face a severe liquidity crisis in the near future that would threaten the viability of

5 A brokered deposit is “any deposit that is obtained, directly or indirectly, from or through the mediation or assistance of a deposit broker.” 12 C.F.R. § 337.6(a)(2). 6 In a February 11, 2010 meeting, the agency told Bank management that the Bank would be deemed “Adequately Capitalized” and its CAMELS composite rating would be downgraded to a 4. AR 269. This downgrade meant that the Bank was “in troubled condition” pursuant to 12 C.F.R. § 563.555 and would be subject to various operating restrictions. AR 269.


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the institution.” AR 549. Based on this determination, the agency informed the Bank that its

liquidity rating had been downgraded to 5, the lowest possible rating. AR 549.

IV. June 2010 Cease and Desist Order

Three days later on June 25, 2010, the Bank and its holding company consented to the

issuance of a formal Cease and Desist Order from OTS. AR 553–94. The order set forth OTS’s

determination that the Bank had “engaged in unsafe or unsound banking practices that resulted in

deteriorating asset quality, ineffective risk management practices, inadequate oversight and

supervision of the lending function, and inadequate liquidity planning at the [Bank].” AR 569.

The Bank did not admit or deny OTS’s findings, but it agreed to comply with a number of

legally binding requirements: to “meet and maintain” total risk-based and core capital ratios of

12% and 8% by June 30, 2010; and to refrain from increasing its total assets beyond a certain

level without prior approval from the OTS Regional Director. AR 554, 562, 569. Although the

capital ratio requirements had been in place since the March 2009 OTS Report of Examination,

the Bank made several requests for an extension of time to meet the requirements. OTS denied

all of these requests. AR 671.

V. The Bank Attempts to Recapitalize

A. Legent Purchase and Recapitalization Transaction

In mid- to late 2010, the Bank and its holding company proposed two transactions in an

attempt to alleviate OTS’s concerns about the stability of the Bank’s institutional deposits and its

capital ratios. First, on July 27, 2010, the Bank formally notified OTS of its intent to acquire

Legent, one of its institutional depositors. AR 2551. By absorbing Legent as an operating

subsidiary, the Bank hoped to obviate any concerns regarding the stability or status of Legent’s

deposits. AR 2552. After determining that the proposed transaction raised “significant issues of


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11

policy,” OTS transferred the acquisition application to its office in D.C. for additional review on

November 4, 2010. AR 3008.

Second, the Bank’s holding company developed a plan to raise approximately $200

million from private investors, $102.5 million of which would be contributed as capital to the

Bank (“Recapitalization Transaction”). AR 972–1091, 1111. On October 28, 2010, the holding

company entered into an investment agreement (“Investment Agreement”) with Oak Hill Anchor

Investor, Lovell Minnick Anchor Investor, and Legent/Duques Anchor Investor (together

“Anchor Investors”). AR 980. Pursuant to the Investment Agreement, the Anchor Investors

agreed to contribute $103 million to the Recapitalization Transaction if, prior to or

contemporaneous with the closing of the proposed investment transaction: (1) the holding

company raised an additional $97 to $102 million from other private investors; (2) OTS waived

certain conditions of the Bank’s June 2010 Cease and Desist Order including the “meet and

maintain” requirement; (3) OTS approved the Bank’s application to acquire Legent; and (4) OTS

approved the Bank’s business plan. AR 980–85. In a November 29, 2010 letter, the Bank

informed OTS that the Anchor Investors were willing to waive a number of the closing

conditions but that they still insisted on these four requirements. AR 1185–90.

The first nail in the Recapitalization Transaction’s coffin came on December 3, 2010,

when OTS notified the Bank of its refusal to remove the “meet and maintain” requirement. AR

1192–93. To make matters worse, in another letter on the same day, OTS also directed the Bank

to take an additional write-down on certain mortgage-backed securities for the quarter ending

September 30, 2010. AR 2092–93. This additional loss reduced the Bank’s total risk-based

capital ratio to 7.8%, which meant that the Bank had become “undercapitalized.” AR 1441.

Things continued to worsen for the Bank on December 13, 2010 when OTS explained that since


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12

the Bank was “undercapitalized,” it was no longer permitted to accept brokered deposits or

employee benefit plan deposits, including any such funds from its institutional depositors. AR

1451. In yet another letter on the same day, the agency directed the Bank to submit a capital

restoration plan (“CRP”) by December 20 and to restore its capital position to “adequately

capitalized” no later than December 31, 2010. AR 1441–42.

B. Capital Restoration Plan

On December 20, 2010, the Bank submitted its CRP, which largely recapitulated the

Recapitalization Transaction and projected an infusion of approximately $102.5 million of new

capital into the Bank following the consummation of the transaction. AR 1473–79. The Bank

recognized that OTS’s refusal to waive the “meet and maintain” requirement – one of the closing

conditions of the Investment Agreement – affected the viability of its recapitalization plan. AR

1476–77. Nonetheless, the Bank continued to argue in favor of the waiver and asserted that

OTS’s unwillingness to waive the requirement was “not a proper exercise of the agency’s

fiduciary duties to the Deposit Insurance Fund.” AR 1476–77. The Revised Business Plan that

the Bank submitted as part of the CRP was also premised on the assumption that OTS would

approve the Legent transaction. AR 1485.

In late December 2010 and early January 2011, the Bank told OTS that a variety of

investors had expressed interest in investing a total of up to $130 million in the Recapitalization

Transaction. AR 1748, 2468–69. According to the Bank, some of these investors had confirmed

their intent to invest and were in the process of reviewing proposed investment agreements,

while others had offered “strong expression[s] of interest” but had not confirmed their intent to

invest. AR 1800. All the potential additional investments were subject to the same conditions

precedent included in the October 2010 Anchor Investment Agreement. AR 1748, 2470.


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13

C. OTS Rejection of the Legent Application and Capital Restoration Plan

On January 18, 2011, OTS rejected the Bank’s proposal to acquire Legent on the grounds

that: (1) Legent had an unsatisfactory enforcement record due to its multiple, serious, and recent

FINRA disciplinary violations; (2) Legent was an unprofitable business that had been losing

money for three consecutive years and had lost 68% of its accounts in spring 2010; and (3) the

purchase of Legent and placement of its institutional deposits in the Bank would exacerbate,

rather than alleviate, the already high concentration of institutional deposits that was posing

severe liquidity risks. AR 4190; see also AR 2540–41 (discussing Legent’s FINRA violations).

On the same day, OTS also rejected the Bank’s CRP on the grounds that it was premised

upon a series of assumptions that the agency found to be unrealistic. OTS noted that the CRP

assumed that:

1. The Bank would be able to secure the additional $100 million in funding necessary to complete the Recapitalization Transaction. AR 4124. The rejection letter explained that although the Bank had identified several potential additional investors, none of these investors had signed a letter of intent or executed an investment agreement. AR 4124.

2. OTS would remove the growth restriction provision of the Cease and Desist Order. The agency explained the asset growth projected in the CRP was unacceptable in light of the Bank’s financial condition. AR 4124.

3. OTS would approve an increase in institutional deposits from $1.2 billion to $1.8 billion, a growth that the agency considered to be an unacceptable increase in risk for the Bank. AR 4124.

4. OTS would approve the Bank’s revised business plan, which according to the agency relied on “excessive concentration in institutional deposits” and an “excessive level of asset growth.” AR 4124–25, 4127.

5. OTS would approve the Bank’s purchase of Legent, which the agency had rejected earlier that day. AR 4125.

6. The Anchor Investors would amend or waive several unsatisfied closing conditions although the Bank had failed to explicitly state in the CRP that the Anchor Investors had agreed to amend or waive any closing conditions, and had failed to provide a draft or executed amendments to the Investment Agreement or communication from the Anchor Investors of their intent to waive the conditions. AR 4125.


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OTS also faulted the Bank for submitting a guarantee that was different from the agency’s

standard-form guarantee. AR 4125.

VI. Liquidity and Institutional Investors

While the Bank was attempting to restore its capital, it was simultaneously addressing

some liquidity issues. Under the Federal Deposit Insurance Act, 12 U.S.C. § 1821(a)(1)(D)((ii),

the Bank could no longer accept employee benefit plan (ERISA) deposits because of its

“undercapitalized” status. Therefore, on December 20, 2010, MSCS, and its client CPI, began

withdrawing their ERISA deposits from the Bank. AR 2242–43. MSCS withdrew its deposits

on demand without adhering to the 60 day notice requirement contained in its depositor

agreement. AR 2242–43. In a letter to OTS, the Bank explained that it did not expect MSCS

and CPI’s withdrawals to impact the Bank’s operations because it had “sufficient liquidity to

address these withdrawals,” and the Bank’s business plan did not assume that any material

portion of the MSCS or CPI deposits would remain on deposit beyond 2011. AR 2243.

The day after MSCS began withdrawing its funds, OTS directed the Bank to submit a

revised liquidity contingency plan that “address[ed] the current acute liquidity risks” at the Bank.

AR 1534. Specifically, OTS was concerned that the Bank’s “interpretation of its contractual

agreements with Institutional Depositors . . . underestimate[d] the risk that certain Institutional

Depositors [would] seek to terminate or withdraw deposits pursuant to their respective Depositor

Agreement.” AR 1536. For example, two of the remaining institutional depositors, ETC and

LTC, had the right to withdraw their deposits since the Bank’s capital had fallen below the PCA

“well capitalized” level. AR 1945, 1952. So the agency asked the Bank to explain what steps it

would take in a worst case scenario if other large institutional depositors, such as LTC and ETC,

either voluntarily withdrew their funds or were required to withdraw their deposits in the event


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the FDIC determined that the funds were “brokered deposits,” despite modifications to the

depositor agreements aimed at avoiding that designation. AR 1536.

On December 28, 2010, the Bank submitted its revised liquidity contingency plan. Like

everything else the Bank had submitted to OTS, this plan was dependent on the consummation of

the Investment Agreement with the Anchor Investors. With respect to the first scenario –

voluntary withdrawal – the Bank noted that unlike MSCS, which was statutorily required to

withdraw its ERISA deposits, the other institutional investors had few if any ERISA deposits.

AR 1555–57. The Bank added that the depositors had remained loyal to the Bank during

“significant and material challenges,” so it was “confident that in contemplation of the pending

private-sector Recapitalization Transaction, none of the remaining Institutional Depositors

[would] seek to withdraw their funds.” AR 1554 (footnote omitted).

Specifically, the Bank stated that LTC had indicated that it would not terminate its

deposit relationship “while the Recapitalization Transaction [was] still a viable transaction for

the Bank’s parent company.” AR 1556. This assertion was supported by a December 22, 2010

letter, in which LTC pledged to refrain from withdrawing its funds until January 31, 2011,

subject to the condition that the Bank return to “well capitalized” status by then. AR 1947.

Additionally, on December 29, 2010, ETC pledged to refrain from withdrawing its funds until

February 15, 2011 but added that February 15 was an “absolute outside date” for recapitalization.

AR 1944–45. Both ETC and LTC reserved their rights to withdraw their funds before the end of

the forbearance period if the Bank’s capital position worsened. AR 1944, 1947.

With respect to the second scenario – a determination from the FDIC that the institutional

deposits were brokered despite modifications to the deposit agreements – the Bank explained

that if the Recapitalization Transaction was not completed, and the FDIC maintained its position


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that the institutional deposits were “brokered,” the Bank would be required to gradually

eliminate the deposits in a safe and sound manner. AR 1559. It added that a “prompt reduction

of 76% of the Bank’s deposits [all of its institutional deposits] would constitute a ‘worst case’

scenario, likely requiring an unsustainable fire-sale of unencumbered assets of the Bank, which

likely could not be accomplished without significant adverse changes to the Bank’s capital

ratios.” AR 1559.

In a December 29, 2010 letter to the Bank, the agency explained that after an off-site

review of the Bank, the OTS examiners had concluded that the Bank’s undercapitalized status:

greatly increased the risk that institutional depositors would withdraw their funds; precluded the

Bank from continuing to accept ERISA deposits; and prevented the FDIC from considering a

waiver of its brokered deposit regulations. AR 1729. Based on this conclusion and the Bank’s

decline in earnings, OTS downgraded the Bank to a CAMEL composite rating of 5, the lowest

possible rating. AR 1727, 1729–30. This rating meant that the institution had an extremely high

probability of failure and an immediate infusion of capital was required. AR 1729.

VII. OTS Appoints FDIC as Receiver for the Bank

On January 19, 2011, OTS field staff submitted a memorandum (“S-Memo”) to the

agency’s Deputy Director, recommending that the Bank be placed into receivership. AR 21–49.

The following day, the Bank informed OTS during a conference call that it was successfully

recruiting investors for its Recapitalization Plan, but it still did not provide any legally binding

investment agreement or letters of intent from any of them. AR 4192, 4229. On the same day,

the OTS Deputy Director endorsed the S-Memo, AR 21, and the OTS Acting Chief Counsel

signed a legal memorandum recommending that the Acting Director appoint FDIC as receiver

for the Bank (“L-Memo”). AR 10–19.


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On January 21, 2011, the OTS Acting Director appointed FDIC as a receiver for United

Western Bank pursuant to 12 U.S.C. § 1464(d)(2)(A) (“Appointment Order”). AR 2–8. The S-

Memo, L-Memo, and Appointment Order all identified the same three statutory grounds for the

decision: (1) the association was in an unsafe and unsound condition to transact business, see 12

U.S.C. § 1821(c)(5)(C); (2) the association was “likely to be unable to pay its obligations or meet

its depositors’ demands in the normal course of business,” see 12 U.S.C. § 1821(c)(5)(F); and (3)

the association was undercapitalized, as defined by 12 U.S.C. § 1831o(b), and had “fail[ed] to

submit a capital restoration plan acceptable” to OTS within the appropriate amount of time, see

12 U.S.C. § 1821(c)(5)(K)(iii). AR 2, 10–11, 21.

On February 18, 2011, the Bank brought this action under 12 U.S.C. § 1464(d)(2)(B)

seeking the removal of the FDIC as its receiver and the restoration of the Bank to its prior owner.

Compl. ¶ 1. The original defendants of that action included OTS, its Acting Director, and the

FDIC. Compl. ¶¶ 26–28. On March 4, 2011, defendants OTS and its Acting Director moved

under Fed. R. Civ. Proc. 12(b)(1) to dismiss the complaint for lack of subject matter jurisdiction.

Defs. Bowman and OTS Mot. to Dismiss [Dkt. # 13]. On April 19, 2011, the FDIC also moved

to dismiss the claims brought against it in its corporate capacity and in its capacity as receiver for

the bank. Def. FDIC Mot. to Dismiss [Dkt. # 21].

On June 24, 2011, the Court dismissed the FDIC as a defendant in this action, but it

allowed the Bank’s claims to proceed against OTS and its Acting Director. Order [Dkt. # 32];

see also Mem. Op. [Dkt. # 33]. On July 21, 2011, OTS became part of OCC and on July 25,

2011, the Court granted OCC’s motion to substitute itself and the Acting Comptroller of the

Currency for defendants OTS and its Acting Director. Minute Order (July 25, 2011). On

February 9, 2012, the Court also granted the Bank’s motion to compel production of the


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complete administrative record and permitted it to obtain information beyond what defendants

had designated as the administrative record. Order [Dkt. # 74].

On April 20, 2012, the Bank moved for summary judgment arguing that OTS’s decision

to place the Bank into receivership was “arbitrary, capricious, an abuse of discretion, and

otherwise not in accordance with the law” because the three statutory grounds the agency relied

on were “unsupported and conclusory.” Pl.’s Mot. at 1; Pl.’s Mem. at 27. Defendants dispute

these assertions in their cross-motion for summary judgment and contend that OTS’s decision

was proper and reasonable and should be upheld. Defs.’ Mem. at 1–2, 26.

STANDARD OF REVIEW

Summary judgment is appropriate “if the movant shows that there is no genuine dispute

as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.

56(a). The party seeking summary judgment bears the “initial responsibility of informing the

district court of the basis for its motion, and identifying those portions of the pleadings,

depositions, answers to interrogatories, and admissions on file, together with the affidavits, if

any, which it believes demonstrate the absence of a genuine issue of material fact.” Celotex

Corp. v. Catrett, 477 U.S. 317, 323 (1986) (internal quotation marks omitted). To defeat

summary judgment, the non-moving party must “designate specific facts showing that there is a

genuine issue for trial.” Id. at 324 (internal quotation marks omitted). The existence of a factual

dispute is insufficient to preclude summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S.

242, 247–48 (1986). A dispute is “genuine” only if a reasonable fact-finder could find for the

non-moving party; a fact is only “material” if it is capable of affecting the outcome of the

litigation. Id. at 248; see Laningham v. U.S. Navy, 813 F.2d 1236, 1241 (D.C. Cir. 1987).


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“‘The rule governing cross-motions for summary judgment . . . is that neither party

waives the right to a full trial on the merits by filing its own motion; each side concedes that no

material facts are at issue only for the purposes of its own motion.’” Sherwood v. Washington

Post, 871 F.2d 1144, 1147 n.4 (D.C. Cir. 1989), quoting McKenzie v. Sawyer, 684 F.2d 62, 68

n.3 (D.C. Cir. 1982). In assessing a party’s motion, “[a]ll underlying facts and inferences are

analyzed in the light most favorable to the non-moving party.” N.S. ex rel. Stein v. District of

Columbia, 709 F. Supp. 2d 57, 65 (D.D.C. 2010), citing Anderson, 477 U.S. at 247.

ANALYSIS

In the January 21, 2011 order, the Acting Director of OTS identified three statutory

grounds for appointing the FDIC as receiver for United Western Bank. In its motion, the Bank

asserts that OTS’s appointment order should be set aside because the Acting Director’s

determination that these three statutory grounds existed was conclusory and unsupported by the

administrative record and the decision was therefore “arbitrary, capricious, an abuse of

discretion, and not in accordance with FIRREA’s requirements.”7 Pl.’s Mot. at 2.

Arbitrary and capricious review “focuses on the reasonableness of the agency’s

decisionmaking processes.” Rural Cellular Ass’n v. FCC, 588 F.3d 1095, 1105 (D.C. Cir. 2009).

The standard is highly deferential. Nat’l Ass’n of Clean Air Agencies v. EPA, 489 F.3d 1221,

1228 (D.C. Cir. 2007). “An agency need only articulate a rational connection between the facts

found and the choice made, and the court will not intervene unless the [agency] failed to consider

7 The weight of authority indicates – and both parties agree – that the judicial review provision of the FIRREA allows a federal court to set aside an appointment decision if it was “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law.” James Madison Ltd. by Hecht v. Ludwig, 82 F.3d 1085, 1093 (D.C. Cir. 1996); Franklin Sav. Ass’n v. Dir. Office of Thrift Supervision, 934 F.2d 1127, 1142 (10th Cir. 1991); Woods v. Fed. Home Loan Bank Bd., 826 F.2d 1400, 1406 n.3 (5th Cir. 1987); see also Pl.’s Mem. at 26 & n.46; Defs.’ Mem. at 8.


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relevant factors or made a manifest error in judgment.” Am. Radio Relay League, Inc. v. FCC,

524 F.3d 227, 233 (D.C. Cir. 2008), citing Motor Vehicle Mfrs. Ass’n of the U.S., Inc. v. State

Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). “Where a highly technical question is

involved, courts necessarily must show considerable deference to an agency’s expertise.” Id.

(internal quotation marks omitted). Although the court must conduct “a thorough, probing, in-

depth review” of the agency’s decision, it may not “substitute its judgment for that of the

agency.” Citizens to Pres. Overton Park, Inc. v. Volpe, 401 U.S. 402, 415–16 (1971), overruled

on other grounds by Califano v. Sanders, 430 U.S. 99, 105 (1977). The party challenging the

agency action as arbitrary and capricious bears the burden of proof. San Luis Obispo Mothers

for Peace v. U.S. Nuclear Regulatory Comm’n, 789 F.2d 26, 37 (D.C. Cir. 1986). Judicial

review of OTS’s appointment decision must be based upon the administrative record. See

Franklin Sav. Ass’n v. Dir. Office of Thrift Supervision, 934 F.2d 1127, 1137 (10th Cir. 1991);

Guar. Sav. & Loan Ass’n v. Fed. Home Loan Bank Bd., 794 F.2d 1339, 1342 (8th Cir. 1986).

Since the Bank fails to overcome this high threshold, the Court will deny its motion for

summary judgment and grant defendants’ cross-motion.


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I. The Administrative Record Supports OTS’s Conclusion That The Bank Failed To Submit An Acceptable Capital Restoration Plan

One of the statutory grounds for the agency’s decision to appoint a receiver for the Bank

was that the Bank was undercapitalized and had failed to submit an acceptable capital restoration

plan to OTS within the time prescribed by 12 U.S.C. § 1831o(e)(2)(D). AR 7. In its motion, the

Bank argues that the Court should overturn the agency’s rejection of the CRP because: (1) the

agency imposed a deadline for the submission of the plan that was shorter than the statutorily

prescribed time period, and (2) “there was no basis for the OTS to reject the Bank’s CRP.” Pl.’s

Mem. at 28–36. These arguments are unpersuasive.

A. The Bank Had Reasonable Time To Submit Its CRP

The Bank’s first challenge is procedural: it contends that OTS failed to give the Bank a

reasonable time to file its CRP as required by statute. Pursuant to 12 U.S.C. § 1831o(e)(2)(D)(i),

OTS is required to “establish deadlines that . . . provide insured depository institutions with

reasonable time to submit capital restoration plans, and generally require an institution to submit

a plan not later than 45 days after the institution becomes undercapitalized.” Contrary to the

Bank’s pleadings, this statutory language does not “entitle[]” it to forty-five days to file its CRP.

Pl.’s Mem. at 28. Rather, the word “generally” means that under normal circumstances, OTS

should give an undercapitalized bank a period of up to forty-five days to submit a CRP. But the

“not later than” wording also gives the agency discretion to impose a shorter deadline as long as

that deadline is “reasonable.”8 According to the Bank, “[w]hat constitutes a reasonable time is a

question of law for this Court [to review de novo] and an issue for which the agency receives no

8 OTS’s regulations also allow the agency to impose a deadline shorter than forty-five days if it “notifies the savings association in writing that the plan is to be filed within a different period.” See 12 C.F.R. § 565.5(a)(1).


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deference.” Pl.’s Mem. 28–29. Even if the Court accepts that legal proposition, it concludes that

the date for the submission of the CRP was reasonable under the circumstances in this case.

On December 13, 2010, OTS directed the Bank to submit a CRP by December 20.9 AR

1441. The Bank asserts that developing a CRP is a significant task and “seven short days . . . did

not give the Bank ‘reasonable time’” to conduct the necessary preliminary financial analysis and

projections, and create a plan that was acceptable to customers, shareholders, and regulators.

Pl.’s Mem. at 28–30. But December 13 was not the first time OTS asked the Bank to restore its

capital. OTS directed the Bank to increase its capital levels more than a year earlier in the March

2009 Report of Examination, and the Bank agreed to do so in the December 2009 Memorandum

of Understanding and June 2010 Cease and Desist Order. AR 139, 220, 554. In carrying out

these obligations, the Bank conducted the necessary analysis and negotiations and developed a

plan for a private sector recapitalization, which was formalized in the October 2010 Investment

Agreement. AR 972–1091. Since the basis for the Bank’s CRP was already in place in October

2010, the seven-day deadline gave the Bank reasonable time to transform its recapitalization plan

into a CRP. And in fact, the Bank met this deadline and submitted a CRP that largely

recapitulated the October 2010 Investment Agreement.

As the Bank admits in its own pleadings, OTS accepted additional submissions from the

Bank concerning the Recapitalization Transaction “right up until its final hours of existence” –

about thirty more days after the submission of the CRP. See Pl.’s Reply at 17. So while a seven

day deadline could be viewed as unduly harsh when viewed in isolation, it is not as if OTS

9 The Bank became undercapitalized on December 8, 2010 and was required to submit its CRP twelve days later on December 20, 2010. See AR 1441. Under 12 U.S.C. § 1831o(e)(2)(D)(i), the forty-five day statutory maximum starts running from the date the institution becomes undercapitalized, not from the date the institution is required to submit a CRP. But since the pleadings of both parties focus on the seven day deadline imposed by the December 13 letter, the Court will evaluate whether this deadline was reasonable.


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suddenly gave the Bank only seven days to restore its capital position. The seven days came

after months of waiting for the promised investors to materialize, and in any event, the deadline

did not operate as a bar to later supplementation while the plan was under consideration.

The Bank’s argument that the deadline was not “reasonable” under the circumstances

because OTS “failed to provide a reasoned explanation” for its imposition also fails. Pl.’s Mem.

at 30. In the December 13 letter, OTS explained that the imposition of the shorter deadline was

based on the Bank’s “unsafe and unsound condition.” AR 1441. This explanation is supported

by the administrative record because at the time, the Bank was undercapitalized, its capital was

continuing to decline, its asset quality and earnings were deteriorating, and the agency had been

expressing serious concerns about the Bank’s liquidity for years. AR 865–66. The “unsafe and

unsound” designation in December should not have come as a surprise to the Bank because it

echoed the finding in the June 2010 Cease and Desist Order, which stated that the Bank had

“engaged in unsafe or unsound banking practices,” AR 569, and OTS’s March 4, 2010 letter

designating the Bank as being “in troubled condition,” AR 275–77. Thus, the CRP submission

deadline was “reasonable.”

B. OTS’s Rejection of the CRP Was Not Arbitrary and Capricious

Recognizing that OTS rejected the CRP on its merits and not because the Bank failed to

meet the submission deadline, the Bank next argues that “there was no basis for the OTS to reject

the Bank’s CRP.” Pl.’s Mem. at 36. According to the Bank, the CRP projected an infusion of

capital into the Bank in excess of the levels required by the agency. AR 1476. The Bank

acknowledges, though, that OTS cannot accept a CRP unless: (1) it is based on “realistic

assumptions,” and is likely to succeed in restoring the institution’s capital; and (2) it would not

“appreciably increase” the risk (including credit risk, interest-rate risk, and other types of risk) to

which the institution is exposed. Pl.’s Mem. at 28, citing 12 U.S.C. § 1831o(e)(2)(C).


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In its January 2011 letter rejecting the CRP, the agency presented six grounds for its

determination that the CRP failed to meet both statutory requirements. AR 4123–26. The Bank

contends that none of these grounds “passes muster.” Pl.’s Mem. at 30. The Court disagrees.

1. Additional Investors

OTS’s first ground for rejecting the CRP was that it unreasonably assumed that the Bank

would obtain the additional $100 million necessary to consummate the Investment Agreement.

AR 4124. The agency noted that although the Bank had identified several potential additional

investors, it had not executed letters of intent or investment agreements with any of them. Id. In

challenging this determination, the Bank asserts that it had identified “serious and substantial”

investors, and OTS’s desire for signed agreements was unreasonable because that “level of

proof” is not required by statute or OTS’s regulations. Pl.’s Mem. at 31–32.

This argument misses the mark. As the Bank notes in its own pleadings, the “statute only

requires that a CRP be built on ‘realistic assumptions’”; it does not define what level of proof is

required. Pl.’s Reply at 21. So the question before the Court is not whether the evidentiary

standard that OTS employed was statutorily mandated but whether OTS’s determination that the

CRP was based on unrealistic assumption was unreasonable or unsupported by the administrative

record. In a January 10, 2011 letter, the Bank informed the agency that three potential investors

had started reviewing proposed investment agreements and three others had expressed strong

interest in the deal. AR 1801. However, none of these investors had legally committed to

investing in the deal, and the Bank provided no timeline as to when it expected to obtain such

commitments. AR 1800–02. In the absence of such commitments or a timeline, it was not

unreasonable for the agency to conclude that the Bank had “fail[ed] to provide sufficient support

for its optimistic assumption that Additional Investors will invest an additional $100 million into


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UWBK in a timely manner or by January 31, 2011, the Association’s proposed date of

recapitalization in the CRP.” AR 4124.10

2. Increase of the Bank’s Risks

The second, third, and fourth grounds for OTS’s rejection of the CRP were all related to

the agency’s determination that the asset growth projected in the CRP unreasonably increased

the Bank’s level of risk. AR 4124–25. OTS explained that the projected asset growth was

unacceptable for two reasons. First, the growth “rel[ied] upon an increase to the already

excessive concentration of institutional deposits at the Association.” AR 4124. Since the agency

had been voicing concern about the liquidity risks associated with the Bank’s concentration in

institutional deposits since at least March 2009, it is not surprising or unreasonable for OTS to

determine that a plan that relied on an increase in that concentration was unacceptable. Second,

the agency explained that the “asset growth described in the CRP [was] also unacceptable in

light of the Association’s poor ratings, troubled condition, high level of existing problem assets,

and poor earnings.” Id. Again, this explanation was not novel or irrational; rather OTS relied on

very similar reasons when it imposed the asset growth restriction in the Cease and Desist Order.

In light of this reasoned explanation, the Court cannot agree with the Bank’s contention that the

agency’s “concern over the Bank’s anticipated growth in total assets” was based on its

“unfounded” assumption that “asset growth is per se destructive,” Pl.’s Mem. at 33; the agency

was concerned about a particular type of asset growth.

10 By the date of the appointment order, the Bank had still failed to submit any binding letters of intent or investment agreements with additional investors. AR 4192–4225. Although, the Bank submitted non-binding letters of intent from several investors, each expressly stated that the letter of intent “d[id] not constitute a legally binding offer or commitment on the part of the Investor or its affiliates to consummate any transaction with the Company or any of its members.” AR 4198–4201, 4207–10, 4221.


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Moreover, as defendants point out in their motion, the success of the CRP was dependent

upon an agreement by OTS to waive the “meet and maintain” requirement contained in the

Cease and Desist Order. AR 1476–77. But OTS had already informed the Bank that it would

not waive this requirement seventeen days before the CRP was submitted. AR 1192–93.

Nonetheless, in the CRP and its pleadings the Bank argued that OTS’s unwillingness to waive

the requirement was “not a proper exercise of the agency’s fiduciary duties to the Deposit

Insurance Fund.” AR 1476–77; see also Pl.’s Reply at 23. In open court, the Bank added that it

was unreasonable for the agency to insist on the requirement because after the consummation of

the Recapitalization Transaction, the Bank would have been well capitalized, and the

requirement would have been unnecessary. Tr. 30:9–18. Based on the administrative record, the

Court cannot conclude that it was unreasonable for the agency to insist on a requirement that it

had imposed since March of 2009 and that the Bank had specifically agreed to fulfill in a

memorandum of understanding and a consent decree. Even if the Bank is correct in its assertion

that the Recapitalization Transaction would have allowed it to meet or exceed the agency’s

demands, it was not irrational for OTS to decide wait until the Bank met the requirement before

removing it.

3. Legent Acquisition

OTS’s fifth ground for rejecting the CRP was that “[t]he CRP’s assumption that the OTS

will approve [the Legent] application is unreasonable.” AR 4125. The Bank argues that this

determination was unfair because it was “forced to speculate about the prospects for the Legent

application’s success” since the application was still pending when it submitted the CRP. Pl.’s

Mem. at 34. But the Bank was not speculating in a vacuum. On November 4, 2010 – more than

a month before the submission of the CRP – OTS informed the Bank that it had determined that

the Legent application “raise[d] significant issues of policy.” AR 3008. This letter notified the


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Bank of the very real possibility that the Legent application could be denied. Therefore, it was

not irrational for OTS to conclude that the Bank’s assumption that the Legent acquisition would

be approved was unreasonable.

The Bank also submits that it was unfair to deny the Legent application and the CRP on

the same day because “[h]ad the OTS issued its decision regarding Legent even one day before

the CRP denial, then the Bank could have revised its CRP to reflect new assumptions following

the rejection.” Pl.’s Mem. at 34. This argument also fails. Since the Legent acquisition was a

condition precedent of the Recapitalization Transaction, the onus was on the Bank to submit a

CRP that addressed the viability of the Recapitalization Transaction and the CRP if the Legent

application was denied. In open court, the Bank argued that OTS’s short deadline prevented it

from developing and including this kind of information in the CRP. Tr. 35:17–23. But as the

Court has already noted, the November 2010 letter gave the Bank more than a month to plan for

the possibility of the denial of the Legent application and include a back-up plan in its CRP.11

4. Other Closing Conditions

Lastly, the agency explained that the CRP was unacceptable because it “unreasonably

and without support or explanation, assume[d] that the Anchor Investors [would] waive or

amend [several] express closing conditions.” AR 4125. In its pleadings, the Bank contends that

this determination was arbitrary and capricious because the agency ignored “the Bank’s

representations [in a November 29, 2010 letter] that the Anchor Investors would waive [certain]

11 In its pleadings, the Bank also argues that the denial of the Bank’s application to acquire Legent did not doom the Recapitalization Transaction because the Bank was prepared to restructure the deal to have the holding company purchase Legent. Pl.’s Reply at 24. However, since the CRP did not present this alternative, the Court cannot conclude that OTS acted irrationally when it concluded that the denial of the Legent application – one of the conditions precedent of the Investment Agreement – doomed the Recapitalization Transaction and the CRP. Moreover, in the three days between the rejection of the CRP and the appointment of the receiver, the Bank did not propose an alternative plan that did not depend on the Legent acquisition.


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conditions.” Pl.’s Mem. at 32–33. But the agency expressly took the representations in the letter

into consideration, saying: “the Association previously suggested that the Anchor Investors

might be willing to provide new capital without satisfaction of some [of] these closing

conditions.” AR 4125 n.2. The problem is that the November 29 letter was merely a list of

“Proposed Revisions to Conditions to Closing,” AR 1185–90, and, as OTS pointed out in the

CRP rejection letter, the Bank never provided the agency with any document stating “that the

Anchor Investors ha[d] agreed to any of the proposed changes.” AR 4125. Without such

documentation, OTS rationally concluded that the CRP’s assumption that investors who had

protected themselves with conditions would waive or amend those conditions was unrealistic.

AR 4125.

In sum, the CRP was dependent upon a series of unlikely events, including predictions

that the agency would be inclined to relax its position on the “meet and maintain” requirements

even though it had just stated that it wouldn’t, and that the agency would bless the Legent

transaction that it had just described as troubling. It was not unreasonable for the agency to find

that the Bank’s assumptions – particularly its assumptions about what the agency itself was

likely to do – were unduly optimistic, and it was not unreasonable for it to require confirmation

beyond the Bank’s own say-so about what the investors were or were not willing to do. Since

OTS has presented a reasoned explanation for its determination that the CRP was statutorily

unacceptable, and the Bank has failed to demonstrate that these reasons were arbitrary or

capricious, the Court will uphold the appointment decision based on this statutory ground.12

12 OTS also rejected the CRP because the Bank submitted a guarantee that was different from the agency’s standard-form guarantee. AR 4125. The Court will not address this ground because it finds that the agency provided sufficient grounds for upholding the rejection based its determination that the CRP did not meet the statutory requirements that it be realistic and not appreciably increase the Bank’s risks.


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II. OTS Reasonably Determined That The Bank Was Facing A Liquidity Crisis

Another statutory basis for the appointment decision was that the Bank was “likely to be

unable to . . . meet its depositors’ demands in the normal course of business” under 12 U.S.C. §

1821(c)(5)(F). AR 2. The Bank challenges this determination, asserting that OTS “wrongfully

concluded that the Bank faced a liquidity crisis because of its relationships with the Institutional

Depositors.” Pl.’s Mem. at 36. To support this assertion, the Bank argues that OTS: (1)

arbitrarily reversed its prior policy concerning the institutional depositors; (2) wrongfully

concluded that the institutional depositors were likely to withdraw their funds; and (3) erred in its

determination that the Bank did not have sufficient funds to cover permissible withdrawals. Pl.’s

Mem. at 36–44; Pl.’s Reply at 4–14. The Court will address these arguments in turn.

A. OTS Did Not Unreasonably Reverse Its Prior Policy Concerning Institutional Deposits

First, the Bank contends that the statement in the appointment order that “there [was] an

unacceptable risk that institutional depositors may withdraw their deposits in the near term” was

arbitrary and capricious because it constituted an unexplained and unsubstantiated reversal of the

agency’s policy concerning the institutional depositors. Pl.’s Mem. at 36–37. The Bank points

to the legal principle that an agency “may change its policy only if provides a reasoned analysis

indicating that prior policies and standards are deliberately changed, not casually ignored.”

Honeywell Int’l Inc. v. Nuclear Regulatory Comm’n, 628 F.3d 568, 579 (D.C. Cir. 2010),

quoting Mich. Pub. Power Agency v. FERC, 405 F.3d 8, 12 (D.C. Cir. 2005) (internal quotation

marks omitted). But that case has little bearing on the situation at hand.

In Honeywell, a company requested exemptions from the Nuclear Regulatory

Commission’s regulations in three consecutive years. 628 F.3d at 571. The Commission granted

the company’s first two requests but denied the third. Id. In its pleadings, the Commission

attempt to justify its actions by arguing that the denial was warranted because of the company’s


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declining financial condition. Id. at 581. The Court of Appeals rejected this explanation and

stated that the company’s financial condition did not justify the Commission’s denial of the third

exemption request because the company was already in decline when the Commission granted

the two other exemptions. Id. The court then overturned the Commission’s denial of the third

exemption request because the decision was “inconsistent with its precedent addressing [the

company’s] exemption requests” and the Commission failed to provide a reasoned decision for

changing its policy. Id. at 580–81.

Here, the administrative record reflects a fundamental change in circumstances

warranting a different approach to institutional deposits. Prior to the financial crisis, the agency

did not object to the Bank’s concentration in institutional depositors. AR 6 n.9. But contrary to

the Bank’s assertion, the agency did not suddenly express concern about this concentration just

before the seizure, and there is no inconsistent precedent as in the Honeywell case. After the

economy collapsed and the Bank’s fortunes declined along with it, the agency regularly voiced

its concerns on this subject, and it provided a reasoned explanation for its worry.13

13 The Bank incorrectly argues that “the Court should look only to the Seizure Order to supply [the agency’s] reasoning” for concluding that the institutional depositors “presented a sudden liquidity danger.” Pl.’s Mem. at 37. In support of this argument, the Bank relies on the well-established rule that “[w]hen there is a contemporaneous explanation of the agency decision, the validity of that action must stand or fall on the propriety of that finding.” Id., citing Sierra Club v. Costle, 657 F.2d 298, 392 (D.C. Cir. 1981). The Bank takes that quotation out of context. When the Supreme Court announced this rule in Camp v. Pitts, 411 U.S. 138, 142–43 (1973), it was explaining that “the focal point for judicial review [under the arbitrary and capricious standard] should be the administrative record already in existence, not some new record made initially in the reviewing court.” Thus, this rule requires the Court to confine its review of the agency’s decision to the administrative record to the exclusion of any evidence outside of that record. It does not restrict the Court to specific parts of that record. Therefore, the Court will look at the entire administrative record to supply OTS’s reasons for developing concern regarding the institutional depositors during the financial crisis.


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OTS’s first clear warning about the Bank’s concentration in institutional deposits came

during the global financial crisis.14 In the March 2009 Report of Examination, the agency

cautioned that “termination of one or more of the larger institutional deposit relationships could

place UWB in a precarious liquidity position.” AR 161. The Bank contends that “the [March

2009] ROE . . . lacked any useful analysis explaining the agency’s new hostility toward the

historically-stable, long-standing Institutional Depositors.” Pl.’s Reply at 7. Contrary to this

contention, the March 2009 ROE provided an adequate explanation for OTS’s determination that

the Bank’s concentration in institutional deposits had become risky. The report explained that as

a result of the financial crisis, the Bank’s asset quality had deteriorated, its earnings had

decreased, and its capital had declined to levels that were barely above the threshold necessary

for the Bank to qualify as “well capitalized.” AR 135–36. The report added that the contractual

agreements with some of the institutional depositors allowed them to withdraw their funds if the

Bank’s capital fell below the PCA “well capitalized” level, and a continued decline of capital

could place the Bank into a precarious liquidity position. AR 161, 164. Notably, the agency did

not immediately take action against the Bank in light of these concerns. Rather, it worked with

the Bank to develop a Memorandum of Understanding, pursuant to which the Bank pledged to

develop a concentration policy that “specifically address[ed] deposit concentrations and plans to

reduce or manage such concentrations.” AR 223–24.

14 OTS argues that it first warned the Bank about this risk in the October 2007 ROE when it stated that the Bank “continue[d] to face risk from its concentration in institutional deposits.” AR 57; see also Defs.’ Mem. at 35. However, in the 2007 ROE, OTS tempered this warning by ultimately concluding that the Bank’s liquidity sources were “satisfactory” and that the Bank’s business strategy and contractual agreements with the institutional depositors “help[ed] protect the institution’s liquidity position.” AR 57. As the Bank notes, this muddled message “could hardly be said to have sounded the alarm” about the institutional deposits. Pl.’s Reply at 6.


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As the Bank’s condition worsened, the agency’s concerns about the risks associated with

its concentration in institutional deposits escalated. In an April 2010 letter, the agency stated that

the Bank’s “significant concentration in institutional deposits . . . pose[d] a threat to the viability

of the Bank” and directed the Bank to consider a “possible sale, merger, or self-liquidation . . . to

prevent the potential failure of the institution due to insufficient liquidity.” AR 267. Again, the

agency provided a reasoned explanation for these alarming statements. It explained that the

concentration in institutional deposits was problematic because the FDIC was reviewing whether

the deposits were “brokered.” AR 267. If the FDIC concluded that the institutional deposits

were brokered, the Bank would not be able to accept or renew the brokered deposits without a

waiver from the FDIC because it would have become only adequately capitalized. AR 267; see

also AR 317, 1110 (the Bank became “adequately capitalized” as of March 31, 2010). Again,

the agency did not immediately seize the Bank; rather it worked with the Bank and developed the

Consent Cease and Desist Order in which the Bank again agreed to create a liquidity contingency

plan that “specifically address[ed] deposit concentrations and plans to reduce or manage such

concentrations.” AR 560.

The change in the Bank’s financial condition during the financial crisis justifies OTS’s

concern about the concentration in institutional investors. Unlike in Honeywell, where the

Commission granted the two prior exemptions while the company’s financial condition was

already in decline, here OTS made it clear that it did not approve of the Bank’s reliance on

institutional depositors as soon as the Bank’s condition began to decline, and it never wavered.

It alerted the Bank to its concerns in the March 2009 ROE, the December 2009 MOU, the April

2010 letter, and the June 2010 Cease and Desist Order. In light of the changing economic

environment, and the agency’s reasoned explanations for its concerns, the Court cannot agree


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with the Bank’s contention that OTS “suddenly” and arbitrarily reversed its policy concerning

institutional depositors shortly before the seizure.

B. OTS’s Conclusion That There Was An Unacceptable Risk That Institutional Depositors May Withdraw Their Deposits In The Near Term Was Reasonable

Second, the Bank’s contention that the agency “imagined” a liquidity crisis because

“there was no likelihood whatsoever that the institutional depositors would withdraw,” Pl.’s

Mem. at 39, is contradicted by the record. Approximately a month before the appointment

decision, MSCS, the Bank’s second largest institutional depositor, began withdrawing its ERISA

deposits because the Bank’s undercapitalized status prevented it from accepting such deposits.15

AR 1457–58.

Further, the Bank’s undercapitalized status triggered the termination clauses in the

deposit agreements with ETC and LTC, the association’s largest and fourth largest institutional

depositors. AR 1945, 1952; see also Defs.’ Mem. at 30. The Bank correctly points out that

these depositors had a “long and loyal history,” with the Bank and had consistently worked with

the Bank during the financial crisis. Pl.’s Reply at 13. As the Bank noted at the hearing, the

depositors removed their ERISA deposits from the Bank so that they would not be subject to the

same rule that required MSCS to withdraw its funds, they modified their deposit agreements with

15 The Bank claims that MSCS and its client CPI were forced by OTS to withdraw their deposits because the agency “in its quest to set the Bank up for failure” forced “the Bank into undercapitalized status via an unnecessary” write-down on its mortgage portfolio. Pl.’s Reply at 8–9 & n.7. But “when reviewing an agency’s decision concerning matters lying within the agency’s field of expertise, a reviewing court should begin by acknowledging that a presumption of procedural and substantive regularity attaches.” James Madison, 868 F. Supp. at 8, citing Franklin Savs. Ass’n v. Dir. Office of Thrift Supervision, 934 F.2d 1127, 1147 (10th Cir. 1991). In its letter directing the Bank to take the write-down, the agency explained that it had “carefully reviewed” the Bank’s objections to the write-down and had found that the Bank’s “modeling approach and assumptions do not conform to regulatory reporting requirements.” AR 2092. Since the Bank provides no basis for its claim that the write-down was unnecessary or that the agency wanted the Bank to fail, the Court concludes that it has not met its burden to overcome the presumption of validity accorded to the agency’s decision.


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the Bank to avoid the “brokered deposit” designation, and they signed written agreements to

refrain from withdrawing their funds from the Bank albeit with certain caveats. Tr. 40:1–13;

41:7–23; 42:2–13. But even if the Court agrees that the depositors might have been willing to

weather the storm with the Bank, the arbitrary and capricious standard does not allow it to

substitute its judgment for that of the agency. Overton Park, 401 U.S. at 415–16. The sole

question before the Court is whether OTS’s conclusion that there was an “unacceptable risk that

the institutional depositors may withdraw their deposits in the near term” was reasonable based

on the administrative record. Pl.’s Mem. at 37.

As the Bank has acknowledged, the institutional depositors were willing to maintain their

deposits “so long as the recapitalization remained a viable option.” Tr. 41:15. Both ETC and

LTC expressly conditioned their agreements to refrain from withdrawing their funds on the Bank

restoring its capital by a set deadline: LTC specifically “reserve[d] its right to terminate the

[deposit] Agreement” if the Bank did not achieve “well capitalized” status by January 31, 2011,

AR 1947, and ETC agreed to refrain from exercising its right to withdraw its deposits until

February 15, 2011 based on its understanding that the Bank was close to securing capital to

remedy its situation. AR 1945, 1947. Since OTS had already refused to implement several

conditions precedent of the Recapitalization Transaction, it was not unreasonable for it to

determine that the plan was no longer viable, and that there was an unacceptable risk that the

institutional depositors would withdraw their funds when it became “clear that the [Bank’s]

present attempts to raise capital [would] be unsuccessful.” AR 34.16

16 The depositors ultimately agreed to extend their forbearance agreements to match the scheduled closing date of the Recapitalization Transaction. Pl.’s Reply at 11–12. But this fact does not alter the Court’s analysis because the agreements were still conditioned on the Bank consummating the Recapitalization Transaction, which OTS had reasonably determined was no longer viable.


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Indeed, the Bank’s holding company made public statements about the Bank’s liquidity

position at the time that were consistent with OTS’s conclusions. In a December 2, 2010 letter to

the Bank, the NASDAQ stock exchange explained that the holding company had informed it

that:

Due to its weakened financial status, the Bank has experienced a decline in deposits, and it believes that unless it resolves its difficulties in the near-term, additional depositors may move their funds elsewhere, further weakening the financial condition of both the Company and the Bank. . . . Consequently, pursuant to Cease and Desist Orders (the “Orders”), the banking regulators have imposed stringent enforcement actions requiring the Company and the Bank to raise additional capital in the near term or face additional regulatory actions. Thus far the Company has been unable to raise the amount of capital required under the Orders. . . . The Company also expects that at the end of the current year, the Bank will fall below the level required to be adequately capitalized. . . . As a result, the Bank would be unable to hold certain deposits (that currently account for over 75% of its total deposits) and would face a liquidity crisis that it believes would lead to the regulator recommending the seizure of the Bank, resulting in the liquidation of the Company.

AR 2457–58 (emphasis added). The letter also stated that the holding company had informed the

exchange that the Recapitalization Transaction was “the only viable option” for restoring its

capital and eliminating “the prospect of the Bank being seized or the Company being liquidated.”

AR 2458. Again, since OTS had already rationally concluded that the Recapitalization

Transaction was not viable, it was not unreasonable for it to agree with the holding company’s

conclusion that without such recapitalization, the Bank “would face a liquidity crisis.”

C. OTS’s Determination That the Bank Had Insufficient Liquidity To Sustain Institutional Deposit Withdrawals Was Not Arbitrary Or Made In Bad Faith

Third, the Bank argues that OTS erroneously concluded that the Bank had insufficient

liquidity to cover mass institutional deposit withdrawals. Pl.’s Reply at 13. OTS’s appraisal of

assets leading to an insolvency determination “is a matter of judgment and discretion,” and the

Court will not substitute its judgment for that of the agency “unless it appears by convincing


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proof that the Comptroller’s action is plainly arbitrary, and made in bad faith.” United States

Savs. Bank v. Morgenthau, 85 F.2d 811, 814 (D.C. Cir. 1936).17 The “presumption of the

correctness of an agency’s determination is even stronger where Congress has charged an agency

with complex analytical responsibilities and the duty to make predictive judgments.” James

Madison, 868 F. Supp. at 8, quoting Franklin Savs. Ass’n v. Dir., Office of Thrift Supervision,

934 F.2d 1127, 1147–48 (10th Cir. 1991).

In its memorandum recommending placing the Bank into receivership, the OTS field

staff provided a detailed analysis of the Bank’s liquidity situation. The memorandum explained

that according to the Bank’s own liquidity analysis, as of January 13, 2011, the Bank had:

$398.5 million in total cash, $17.8 million in unused borrowing capacity from FHLB-Topeka,

and an additional $137 to $350 million that it could have obtained from Legent. AR 38–39; see

also AR 39 n.30. This added up to a total of $553.3 to $766.3 million, which would have been

insufficient to cover the potential withdrawal of a total of $848 million in deposits from ETC,

LTC, and MSCS’s remaining funds. AR 39–40 n.30–31.

The Bank disputes this conclusion by asserting that its on-hand liquidity increased to

$426 million on January 20 and that it could have taken advances from the FHLB and accepted

Qwikrate deposits to shore up its cash position. Pl.’s Reply at 13. However, as defendants point

out, OTS’s calculations already accounted for the FHLB and Qwikrate funds, and the $27.5

million increase in liquidity would have increased the Bank’s total available liquidity to a

maximum of $793.8 million, which still would have been insufficient to cover the withdrawal of

institutional deposits. Defs.’ Reply at 13 n.14. Even if the institutional depositors withdrew

their funds incrementally over several months, instead of all at once, the Bank has not explained

17 Although OTS did not actually declare the Bank to be insolvent, as the Bank points out, its “emphasis on liquidity and . . . capitalization was a close cousin.” Tr. 22:5.


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how it would have obtained additional resources to cover the withdrawals. The Bank has thus

failed to overcome the presumption of correctness accorded to the agency’s detailed analysis of

the Bank’s liquidity position because it has not submitted any facts to show that the agency’s

determination was arbitrary or made in bad faith.

Since the Bank has failed to show that OTS’s conclusion that the Bank was likely to be

unable to pay its obligations or meet its depositors’ demands in the normal course of business

was irrational, manifestly erroneous, or made without consideration of the relevant factors, the

Court will also uphold the appointment order on that ground.

III. OTS’s Determination That the Bank Was Unsafe And Unsound Was Not Irrational

The third statutory ground for the appointment order was that the Bank was operating in

an unsafe and unsound condition under 12 U.S.C. § 1821(c)(5)(C). AR 2. In challenging this

ground, the Bank asserts that OTS “erred in applying the wrong standard for ‘an unsafe or

unsound practice’ . . . [and that] even if the agency had applied the correct standard, the

agency’s position would still be refuted by the facts before it.” Pl.’s Mem. at 42.

The Bank’s argument that the agency should have used the “unsafe and unsound”

standard of the D.C. Circuit instead of the “more permissive standard” of the Tenth Circuit, Pl.’s

Reply at 26, fails on its face. An agency must follow the law of the circuit having jurisdiction

over the action, see Johnson v. U.S. R.R. Ret. Bd., 969 F.2d 1082, 1090–91 (D.C. Cir. 1992), and

as the Bank admits in its pleadings, both the Tenth and the D.C. Circuit could have exercised

jurisdiction over this lawsuit. Pl.’s Mem. at 42 & n.97. Since the Bank’s home office is in

Colorado, and at the time of the appointment decision, there was no lawsuit pending in either

circuit, the agency’s decision to apply the Tenth Circuit standard was reasonable. The cases

cited by the Bank to support its position are inapposite because none of them require an agency

to anticipate that the Bank will ultimately file a case in the jurisdiction with the more stringent


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standard and apply the law of that circuit. See Pl.’s Mem. 42 n.97. Finally, the Bank’s argument

that OTS routinely applies Tenth Circuit law even when there is no nexus with the Tenth Circuit

is irrelevant because in this case, there was a strong nexus to the Tenth Circuit and the agency

was legally allowed to apply its case law.

More importantly, the factors that the agency considered in its appointment order support

a conclusion that the Bank was unsafe and unsound even under the D.C. Circuit standard. In this

circuit, a Bank operates in an unsafe and unsound condition if it is in a condition or engaged in

practice that presents a reasonably foreseeable undue risk to the institution. See Kaplan v. OTS,

104 F.3d 417, 421 (D.C. Cir. 1997).

The appointment order articulated several events that presented a reasonably foreseeable

undue risk to the Bank. The order cited the Bank’s:

“[C]ontinuing significant operating losses.” AR 6. The Bank had in fact lost at least $152 million between 2009 and the date of the receivership. AR 30, 1492.

“[W]eak capital position.” AR 6. From 2009 to 2010, the Bank’s capital levels deteriorated significantly. AR 142, AR 25; see also Bank CRP, AR 1491 (projecting that capital ratios would continue to decline).

“[S]ignificant asset problems.” AR 6. The Bank’s assets had been deteriorating since 2008. AR 135–36.

“[R]eliance on a small number of institutional depositors” for the vast majority of its liquidity. AR 6. One of these depositors had already withdrawn most of its deposits and two others might have withdrawn their funds once they realized that the Bank’s recapitalization efforts were not viable. AR 5–6.

The Bank argues that the agency’s “unsafe and unsound”’ determination does not meet

this circuit’s standard because it was based on the “faulty premise that the Institutional

Depositors posed a liquidity risk to the Bank” and the erroneous conclusion that the Bank had


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“insufficient capital” and “no realistic prospects for raising capital in the short term.”18 Pl.’s

Mem. at 45. However, as the Court has already decided, the agency had a reasonable basis for

concluding that the Bank’s concentration in institutional deposits posed a liquidity risk to the

Bank, and that the Bank had no viable plan for restoring its capital.

Since the factors relied on by OTS in the appointment order also support a determination

that the Bank was unsafe and unsound under the D.C. Circuit standard, the Court will uphold the

appointment order on that ground.

CONCLUSION

At bottom, after one strips away all of the hyperbole about the agency’s “sudden” change

of heart, the Bank’s fundamental grievance is that if only the agency had just given it a little

more time, it would have been able to come up with the necessary capital to save the day.

Maybe. There are reasons to be skeptical: the Bank’s plans were dependent upon regulatory

changes that were unlikely to materialize, and the potential investors had carefully buffered their

commitments with numerous contingencies. On the other hand, this was a Bank with a long

history of profitability, it had longstanding institutional relationships, and there were at least

some investors willing to take a closer look. There is no doubt that the officers and directors

18 The Bank takes issue with OTS’s conclusion that the Bank had “no realistic prospects for raising capital in the short term” contending that Congress did not demand immediate recapitalization and that OTS’s belief that the Bank’s recapitalization efforts “would necessarily rise and fall with the Recapitalization Transaction” was an “unduly narrow view of the Bank’s capital prospects.” Pl.’s Mem. at 45–46. But the agency did not demand immediate capitalization. It had been asking the Bank to recapitalize for more than one and a half years. See e.g., 2009 MOU, AR 220 (asking the Bank to “submit a written Capital Plan”). In that time period, the Bank presented only one recapitalization plan and the holding company stated that this plan was the Bank’s “only viable option” for restoring its capital. AR 2458. Further, the 2010 Investment Agreement prohibited the Bank from “enter[ing] into any agreement to raise capital other than in connection with the transaction contemplated under the Investment Agreement.” AR 1189 (November 2010 letter to OTS stating that the investors were unwilling to waive this provision). Therefore, the agency reasonably concluded that the since the Recapitalization Transaction was not viable, the Bank had no realistic prospects for restoring capital.


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were seriously committed to the task, and one cannot simply dismiss their efforts, or their sincere

belief that they would ultimately succeed, as frivolous. But in the end, whether the Court accepts

the Bank’s assessment of its prospects wholeheartedly or with reservations is beside the point.

Given the standard that must be applied in this proceeding, the Court cannot find that the

agency’s decision was unreasonable under all of the circumstances at the time it was made, or

that it was not supported by the administrative record. The Court will uphold OTS’s decision to

appoint the FDIC as receiver for the Bank because the Bank has failed to demonstrate that the

Acting Director failed to articulate a rational basis, failed to consider the relevant factors, or

made a manifest error in judgment when he concluded that there were three statutory grounds

that independently supported the decision.19 Accordingly, the Court will deny the Bank’s motion

for summary judgment and grant the defendants’ cross-motion. A separate order will issue.

AMY BERMAN JACKSON United States District Judge

DATE: March 5, 2013

19 “When an agency relies on multiple grounds for its decision, some of which are invalid, [courts] may only sustain the decision where one is valid and the agency would clearly have acted on that ground even if the other were unavailable.” Williams Gas Processing-Gulf Coast, Co., L.P. v. FERC, 475 F.3d 319, 321 (D.C. Cir. 2006). Since the Court has concluded that all three statutory grounds are valid, it need not address the Bank’s argument that “even if the Court determines that one ground of the seizure order was valid, none of the alleged grounds is sufficient – standing alone – to sustain the decision.” Pl.’s Reply at 29.


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