2010 plus international conference back to the future: a new wave of fdic litigation

2010 PLUS International Conference

Back to the Future:A New Wave of FDIC Litigation


The Round-Up…

Moderator:• Diane Parker Esq., Assistant Vice President, Professional Liability Claims,

Allied World Assurance Company

Panelists:• Gary V. Dixon, Esq., Partner, Troutman Sanders LLC

• Susan N.K. Gummow, Esq., Partner, Butler Pappas Weihmuller KatzCraig LLP

• Jennifer Nierenberg Metzger, Esq., Complex Claims Director, CNA Corporate and Financial Claims

• Floyd “Rob” Robinson, Esq., Senior Counsel, Professional Liability and Financial Crimes Unit, Federal Deposit Insurance Corporation


“Temporal displacement has occurred…”

• Destination Time: The Banking Crisis of the 1980s

• Present Time: The Financial Crisis of 2008 - ?

• “Not That There’s Any Danger”:

Litigating with the FDIC

• “Who’s Gonna Pay for THIS?”

D&O Coverage, Then & Now


“I gave you explicit instructions

not to come here,

but to go directly back to 1985!”


The Banking Crisis of the 1980s

• Profile of Bank and S&L Failures

• Causes of Bank and S&L Failures

• RTC and FDIC Professional Liability Claims

• Observations About the 1980s Crisis


“I had to wait 30 years

to catch up to you.”


The Financial Crisis of 2008 - ?

• Profile of Bank Failures

• Causes of Bank Failures

• FDIC Professional Liability Claims

• Observations About the Current Crisis


Bank and Thrift Failures, 2007 to Date

Year Number of Institutions

2007 3

2008 25

2009 140

2010 (as ofOct. 22) 139


Bank and Thrift Failures, 2008 – 2010

YearsNumber of

Failed Institutions

AssetsAssets - Inflation Adjusted

1982 - 1994 2,341 $657.1 B $1.12 T

Jul. 2004 – Jan. 2007

0 0 0

2008 – Oct. 22, 2010

304 $630.1 B $638.2 B


Bank and Thrift Failures, 2007 – 2010, by State

StateNumber of

FailuresAssets

Georgia 47 $25.6 B

Florida 43 $32.4 B

Illinois 38 $30.5 B

California 32 $102.4 B


Bank and Thrift Failures, 2007 – 2010, by Assets

StateNumber of

FailuresAssets

Nevada 10 $315.4 B

California 32 $102.4 B

Florida 43 $32.4 B

Illinois 38 $30.5 B


“Not that there’s any danger . . . but it never hurts to take precautions.”


Litigating with the FDIC

• Pre-Suit Investigations and Demands

• Dual Role of FDIC (conservator/receiver)

• Special Statutory Powers of the FDIC

• FDIC as Intervener: Impact on Third Parties


“Can I assume that your insurance will pay for this?”


D&O Insurance Issues

Common coverage issues in FDIC D&O litigation

(then and now)• Definition of Claim• Notice of Claim / Circumstance• Exclusions

Regulatory Insured v. Insured Specific Claim / Litigation / Event Prior Notice / Interrelated Wrongful Acts Prior or Pending / Prior Act


“Where you’re going,

there are no roads.”


Questions&

Answers


Many Thanks To…

• Diane Parker

• Gary Dixon

• Susan Gummow

• Jennifer Nierenberg Metzger

• Floyd “Rob” Robinson

2010 plus international conference back to the future: a new wave of fdic litigation

Documents

international conference

b slide

fdic fdic

thrift failures

prior act slide

profile of bank failures

b florida43

b california32