Federal Deposit Insurance Corp. v. Abraham

The FDIC, as statutory successor to the RTC, appeals the district court's grant of summary judgment dismissing the suit filed by the RTC in June 1993 against fifteen (15) former officers and directors (collectively, Appellees) of Capital-Union Savings, F.A. The gravamen of the district court's judgment was its determination that the claims asserted against Appellees for breach of their fiduciary duties sounded in unintentional tort, i.e., negligence (or gross negligence), and were thus time barred by Louisiana's one-year prescriptive period; that none of the claims against Appellees -- including the claim arising from the repurchase of another thrift's participation in the so-called Esplanade Mall Loan 1 -- rose to the level of fraud, self-dealing, bad faith, or any other kind of misdeed that would constitute a breach of Appellees' fiduciary duty of ""good faith"" under the applicable state statute. 2 The district court concluded that its decision was mandated by our holding in FDIC v. Barton, 3 in the opinion of which we state that ""ross negligence is a violation of the duty of care, but unless it is coupled with fraud, a breach of trust or other ill acts, it does not constitute a breach of fiduciary duty."" 4 The Barton opinion goes on to say that ""o set out a claim for the breach of fiduciary duty, the FDIC would have to have alleged the failure of good faith and loyalty by the Directors."" 5