Metz v. Unizan Bank

• Decision Date: 24 February 2006
• Docket Number: No. 5:05CV1510.,5:05CV1510.
• Citation: 416 F.Supp.2d 568
• Parties: METZ, et al., Plaintiffs, v. UNIZAN BANK, et al., Defendant,
• Court: U.S. District Court — Northern District of Ohio

Page 568

416 F.Supp.2d 568

METZ, et al., Plaintiffs, v. UNIZAN BANK, et al., Defendant,

No. 5:05CV1510.

United States District Court, N.D. Ohio, Eastern Division.

February 24, 2006.

James B. Kenney, Keller & Kehoe, Robert D. Kehoe, Gretchen T. Seymour, Kehoe & Associates, LLC, Daniel G. Morris, Cleveland, OH, for Plaintiffs.

Frances F. Goins, Thomas L. Anastos, Joseph A. Castrodale, Ulmer & Berne, Patrick M. Mclaughlin, McLaughlin & McCaffrey, Jocelyn N. Prewitt-Stanley, Anthony J. O'Malley, Marcel C. Duhamel, Jocelyn N. Prewitt-Stanley, Vorys, Sater, Seymour & Pease, Brett K. Bacon, Frantz Ward, Kathleen A. Nitschke, Giffen & Kaminski, Martha S. Sullivan, Stephen P. Anway, Stephen M. Fazio, Squire, Sanders & Dempsey, Brett A. Wall, John D. Parker, Michael E. Mumford, Baker & Hostetler, David M. Dvorin, Steven L. Wasserman, Victor D. Radel, Chernett, Wasserman, Yarger & Pasternak, Colleen R. Del Balso, Jay C. Rice, Timothy T. Brick, Gallagher, Sharp, Fulton & Norman, Roy E. Lachman, Ohio Savings Bank, Mark I. Wallach, Zoe K. Carlisle, Calfee, Halter & Griswold, Rosemary Taft Milby, Weltman, Weinberg & Reis, Stuart L. Larsen, Kahn Kleinman, Cleveland, OH, Dana C. Lumsden, T. Thomas Cottingham, III, Hunton & Williams, Charlotte, NC, John W. Solomon, F. Daniel Balmert, Vorys, Sater, Seymour And Pease LLP, Akron, OH, John Allen Holmes, Weldon, Huston & Keyser, Mansfield, OH, Steven J. Shrock, Critchfield, Critchfield & Johnston, Thomas D. Gindlesberger, Millersburg, OH, James S. Wertheim, McGlinchey Stafford, Edward

H. Chyun, Levy & Dubyak, Beachwood, OH, Dana M. Farthing, Sky Financial, Bowling Green, OH, Frank J. Rose, Steven A. Anderson, Eugene H. Nemitz, Jr., Fitzpatrick, Zimmerman & Rose, New Philadelphia, OH, Charles C. Butler, Bish, Butler & Thompson, Bryan, OH, Maureen P. Haney, Frost Brown Todd, Cincinnati, OH, Stephen D. Miles, Vincent A. Lewis, Law Office of Stephen D. Miles, Dayton, OH, for Defendants.

MEMORANDUM OPINION AND ORDER

NUGENT, District Judge.

This case is before the Court on the Defendants' Motions to Dismiss Plaintiffs' Second Amended Complaint. The Defendants have filed numerous Motions to Dismiss, some filed jointly by multiple defendants and some filed on behalf of individual defendants. The Defendants raise various issues that they claim should result in the dismissal of the Plaintiffs' claims in a myriad of different motions and briefs. The Court conducted an oral hearing on the statute of limitations issues, and accepted supplemental briefings addressing questions raised during that hearing. Having read all of the relevant filings, reviewed the Second Amended Complaint, and analyzed the applicable law, this Court comes to the following conclusions.

PROCEDURAL HISTORY

Plaintiffs filed a class action complaint against the Defendants in this Federal Court on May 27, 2005. (ECF # 1). They obtained leave to file an Amended Complaint on August 26, 2005 (ECF # 275), and again to file a Second Amended Complaint on November 3, 2005.¹ On November 4, 2005, the Court also granted a motion by JoAnn Floyd, Richard Floyd, Billy Blair and Marlene Blair to intervene as party plaintiffs. A motion for reconsideration or clarification filed by the original plaintiffs is still pending. For purposes of this opinion, the briefing submitted by the intervening party plaintiffs has been reviewed and considered on the statute of limitations issue. The Defendants have filed a myriad of briefs requesting dismissal of Plaintiffs claims. Common to all of the motions to dismiss is the question of whether Plaintiffs' claims under the Uniform Commercial Code ("UCC") are barred by the applicable statutes of limitation.

Motions to dismiss the Plaintiffs' Complaint remain pending under the following ECF numbers: # 168 (Belmont National Bank, Huntington National Bank, Sky Bank, Andover Bank, Farmers National Bank, Republic Savings Bank, Covington Savings & Loan Assn., First Central National Bank, Killbuck Savings Bank Co., Americom Bank, Monroe County Bank, U.S. Bancorp, Hambuco Credit Union, now known as AurGroup Financial Credit Union (via Notice of Joinder, ECF # 318), First Indiana Bank (via Notice of Joinder, ECF # 308)), # 169 (United Fidelity Bank), # 170 (Old National Bank), # 177 (Wilson & Muir Bank & Trust Co.), # 179 (Dollar Bank), # 189, 190 (Springs Valley Bank & Trust, Crane Federal Credit Union), # 212 (Ohio Valley National Bank), # 228 (Tuscarawas School Credit Union), # 241 (Richland Bank, First-Knox Bank, Park National Bank, United Bank, N.A., Security National Bank), # 273 (Mechanics Savings Bank), # 299 (Unizan Bank), # 300 (JP Morgan Chase Bank, N.A. (successor in interest to BankOne Corp.), Mid-Ohio Securities Corp., Citigroup, Inc., Charles Schwab Co., PNC Bank National, Dover-Philadelphia Federal Credit Union), # 307 (WachOvia Bank, N.A., Suntrust Bank, N.A.), # 309 (Fifth Third Bank), # 312 (First Federal Community Bank), # 313 (Third Federal Bank), # 343 (Wright-Patt Credit Union, L.C.E. Federal Credit Union), # 346 (Keybank), # 350 (First Merit, National, City Bank, N.A.), # 352 (Charter One), # 354 (Terre Haute Savings Bank), and # 373 (Matrix Capital Bank).² Most of these motions were filed or re-filed after leave to file the Second Amended Complaint was granted by the Court. However, some were submitted in response to the original Complaint or the First Amended Complaint. In so far as those motions address the statute of limitations issue, however, nothing in the Second Amended Complaint altered the question at issue, and they shall be considered as if they had been re-filed following the filing of the Second Amended Complaint. In addition, there have been two motions filed specifically to dismiss the Intervenors' Complaint. ECF # 361 (National City Bank, N.A.); ECF # 363 (Hambuco Credit Union). These motions also incorporate the same arguments and issues raised in the motions to dismiss the Plaintiffs' Second Amended Complaint.

Plaintiffs, in response to the motions to dismiss on statute of limitations grounds, filed a Motion to Certify the Question of the Statute of Limitations for ORC §§ 1303.16 & 1304.09 to the Ohio Supreme Court. (ECF # 266). This motion also incorporated the Plaintiffs arguments against dismissal on statute of limitations grounds. A hearing was held before the Court on September 14, 2005, following which the parties were given the opportunity to file supplemental briefs. The pending motions to dismiss have now been fully briefed and are ready for consideration.

PARTIES

The Plaintiffs are individuals who, between 1998 and 1999 purchased promissory notes in either Serengeti Diamonds U.S.A., Inc. ("Serengeti") and/or in Lomas De La Barra Development Corporation, Inc., ("Lomas") and who claim to have been injured when their checks were improperly paid into depositary bank accounts opened, operated, and/or maintained by individuals without authority to open, operate, and/or maintain said accounts on behalf of Serengeti or Lomas.

There are three main categories of Defendants in this action. The first are the Ohio Drawee Banks. They include: Unizan Bank (individually and as corporate successor by merger of First National Bank of Zanesville and County Savings Bank), Fifth Third Bank (individually and as corporate successor to Citizens Bank and The Strongsville Savings Bank), National City Bank (individually and as corporate successor of Provident Bank), Charter One Bank, Key Bank (individually and as corporate successor of Society Bank), Huntington National Bank, J.P. Morgan Chase Bank (as successor by way of merger with Bank One), FirstMerit Bank, Andover Bank, Mid-Ohio Securities Corporation, Third Federal Bank, Dollar Bank, Mechanics Savings Bank, Farmers National Bank (as parent of Farmers National Bank of Canfield), U.S. Bancorp (as corporate successor by merger of Star Bank & Firstar), Covington Savings and Loan Association, Park National Bank (individually and as corporate successor to First-Knox Bank and United Bank, N.A.), First Central National Bank, Security National Bank, Republic Savings Bank, Wright-Patt Credit Union, Belmont National Bank, Citigroup, Inc., Smith Barney (division of Citigroup Global), Charles Schwab & Co, Inc., Killbuck Savings Bank Co., PNC Bank National, Richland Bank, Tuscarawas Schools Credit Union, Inc., Sky Bank (as corporate successor by merger of Metropolitan Bank and Trust Co., and Americom Bank and the Citizens Banking Company), First Federal Savings Bank of Dover (otherwise known as First Federal Community Bank), Dover-Phila Federal Credit Union, L.C.E. Federal Credit Union, and AurGroup Financial Credit Union (formerly known as Hambuco Credit Union). Only Count One of the Second Amended Complaint applies to the Ohio Drawee Banks.

The second category includes Non-Ohio Drawee Banks. The Non-Ohio Drawee Banks include: Wachovia National Bank (individually and as corporate successor by merger of First United Bank and/or First United Bancorp and First Union)(Florida), Matrix Capital Bank (New Mexico), United Fidelity Bank (Indiana), Ohio Valley National Bank of Henderson (Kentucky), Wilson & Muir Bank & Trust Co. (Kentucky), Old National Bank (individually and as the parent of Dubois County Bank) (Indiana), Springs Valley Bank & Trust (Indiana), Federal Credit Union (Indiana), First Indiana Bank (individually and as corporate successor to Mid-West Federal Credit Union)(Indiana), Monroe County Bank (Indiana), State Street Bank (Massachusetts), and Terre Haute Savings (Indiana).³ The Non-Ohio Drawee Banks are not located in Ohio and have not all consented to the jurisdiction of this court. Nonetheless, some of these banks have appeared and have addressed the statute of limitations issue under the UCC 4-111, as codified in Ohio and by the individual states in which they are located. Of these, Matrix Capital Bank, Federal Credit Union, Ohio Valley National Bank, Springs Valley Bank & Trust, United Fidelity Bank, and Wilson &...