2010 plus international conference back to the future: a new wave of fdic litigation
TRANSCRIPT
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2010 PLUS International Conference
Back to the Future:A New Wave of FDIC Litigation
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2010 PLUS International Conference
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
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2010 PLUS International Conference
“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
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2010 PLUS International Conference
“I gave you explicit instructions
not to come here,
but to go directly back to 1985!”
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2010 PLUS International Conference
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
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2010 PLUS International Conference
“I had to wait 30 years
to catch up to you.”
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2010 PLUS International Conference
The Financial Crisis of 2008 - ?
• Profile of Bank Failures
• Causes of Bank Failures
• FDIC Professional Liability Claims
• Observations About the Current Crisis
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2010 PLUS International Conference
Bank and Thrift Failures, 2007 to Date
Year Number of Institutions
2007 3
2008 25
2009 140
2010 (as ofOct. 22) 139
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2010 PLUS International Conference
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
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2010 PLUS International Conference
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
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2010 PLUS International Conference
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
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2010 PLUS International Conference
“Not that there’s any danger . . . but it never hurts to take precautions.”
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2010 PLUS International Conference
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
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2010 PLUS International Conference
“Can I assume that your insurance will pay for this?”
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2010 PLUS International Conference
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
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2010 PLUS International Conference
“Where you’re going,
there are no roads.”
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2010 PLUS International Conference
Questions&
Answers
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2010 PLUS International Conference
Many Thanks To…
• Diane Parker
• Gary Dixon
• Susan Gummow
• Jennifer Nierenberg Metzger
• Floyd “Rob” Robinson