State of Idaho, Dept. of Finance v. Clarke, Civ. No. 92-0080-S-HLR.

Citation786 F. Supp. 885
Decision Date13 March 1992
Docket NumberCiv. No. 92-0080-S-HLR.
PartiesSTATE OF IDAHO, DEPARTMENT OF FINANCE, Plaintiff, v. Robert C. CLARKE, in his capacity as the Comptroller of the Currency, U.S. Bancorp, an Oregon corporation, First National Bank in Spokane, a/k/a U.S. Bank of Idaho, N.A., Defendants.
CourtUnited States District Courts. 9th Circuit. District of Idaho

Larry Echohawk, Atty. Gen., State of Idaho, Fred C. Goodenough, Deputy Atty. Gen., Dept. of Finance, State of Idaho, Boise, Idaho, for plaintiff.

Stuart M. Gerson, Asst. U.S. Atty. Gen., Maurice O. Ellsworth, U.S. Atty., Dist. of Idaho, Anne L. Weismann, Eric D. Goulian, U.S. Dept. of Justice, Civil Div., Washington, D.C., for defendant Robert C. Clarke.

Clifford N. Carlsen, Jr., Miller, Nash, Wiener, Hager & Carlsen, Portland, Or., Bruce C. Jones, Evans, Keane, Koontz, Boyd, Simko & Ripley, Boise, Idaho, for defendants U.S. Bancorp and U.S. Bank of Idaho, N.A.

ORDER OF DISMISSAL FOR LACK OF SUBJECT MATTER JURISDICTION

RYAN, Chief Judge.

Currently before the court are the following motions: (1) plaintiff's Motion for Preliminary Injunction, filed on February 27, 1992; (2) Defendants U.S. Bancorp and U.S. Bank of Idaho, N.A.'s Motion for Summary Judgment, filed on March 2, 1992; (3) and Defendant Comptroller of the Currency's Motion to Dismiss or in the Alternative for Summary Judgment, filed on March 10, 1992. The court, in addition to reviewing the written responses and replies to these motions, heard oral arguments on these motions on Friday March 13, 1992. Therefore, the motions are now ripe for review.

I. FACTS AND PROCEDURE

On February 21, 1992, the State of Idaho, Department of Finance (Department), filed a Complaint for Declaratory and Injunctive Relief against the named defendants. In this complaint, the Department has requested that this court enter a declaratory judgment regarding the rights and obligations of the named parties in respect to the alleged failure of the defendants to comply with state and federal banking law. Complaint for Declaratory and Injunctive Relief, filed Feb. 21, 1992, at 4-5. In addition, the Department has requested that this court issue a preliminary and permanent injunction restraining and enjoining the defendants U.S. Bancorp, First National Bank in Spokane, a/k/a U.S. Bank of Idaho, N.A., from relocating their offices in the state unless previously approved or authorized by the state. Id. at 6-7. The plaintiff asserted in its complaint that this court has jurisdiction to address these issues under 28 U.S.C. § 2201 and 28 U.S.C. § 1331.1Id. at 2.

The facts that underlie the Department claims are rather straightforward and are not in dispute. The court finds that an accurate summary of the relevant facts is found in the statement of material facts submitted by the Comptroller in support of its motion for summary judgment. As stated by the Comptroller, the material facts are as follows:

1. Defendant U.S. Bancorp ("Bancorp") is an Oregon corporation and a multi-bank holding company.
2. Defendant First National Bank in Spokane ("FNBS") is a wholly-owned subsidiary of Bancorp chartered under the National Bank Act.
3. On March 16, 1990, FNBS applied to the Comptroller for approval under the National Bank Act, 12 U.S.C. § 30, to relocate its main office from Spokane, Washington, to Coeur d'Alene, Idaho.
4. On March 16, 1990, Bancorp applied to the Federal Reserve Board ("the Board") ... for approval under the Bank Holding Company Act, 12 U.S.C. § 1842, to relocate FNBS's main office from Spokane, Washington, to Coeur d'Alene, Idaho.
5. Spokane, Washington, is less than thirty miles away from Coeur d'Alene, Idaho.
6. On May 1, 1991, the Comptroller by letter approved the FNBS's proposed relocation.
7. On February 18, 1992, the Board issued a letter in response to Bancorp's application stating that "no application is required in this case."
8. On February 19, 1992, FNBS moved its main office to Coeur d'Alene, Idaho, and commenced operations there under the name U.S. Bank of Idaho, N.A.
9. On February 21, 1992, the plaintiff State of Idaho filed a petition in the Ninth Circuit Court of Appeals for review of the Board's decision.

Comptroller of the Currency's Statement of Material Facts Not in Dispute, filed March 10, 1992, at 1-2.

As stated above, the Department, in the complaint filed in this action, is challenging the decision of the Comptroller which allowed FNBS to move its main office to Coeur d'Alene and begin operations. The Department asserts that this decision was in conflict with both federal and state law which deal with the expansion of banks within the state.

II. THE COURT'S JURISDICTION

A. Summary of Arguments

Because this court is a court of limited jurisdiction, it is axiomatic that before this court can address the merits of plaintiff's claims and before it can issue a preliminary injunction, the threshold issue that must be decided is whether this court has subject matter jurisdiction over the claims being asserted. In support of their motions for summary judgment and motion to dismiss, the defendants have asserted that this court lacks jurisdiction to review the issues that are before it. The burden, therefore, is on the Department to establish subject matter jurisdiction. Stock West, Inc. v. Confederate Tribes of Colville Reservation, 873 F.2d 1221, 1225 (9th Cir.1989). The court will initially address this issue.

Defendants U.S. Bancorp and First National Bank in Spokane, a/k/a U.S. Bank of Idaho, N.A., (hereinafter the Bank defendants), argue in support of their motion for summary judgment that this court lacks subject matter jurisdiction to hear the Department's claims. Even though the Bank defendants have asserted this claim as support for a summary judgment, the court finds it more appropriate to review this assertion by the Bank defendants as a motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1) of the Federal Rules of Civil Procedure. The Bank defendants argue that this court lacks jurisdiction because the Department's sole complaint with the Comptroller's decision is that it is in conflict with the federal and state laws in that the decision to approve the relocation allowed "the expansion of Bancorp into the State of Idaho without the express statutory authorization for such expansion into this state, as required by the Douglas Amendment to the Bank Holding Company Act, 12 U.S.C. § 1842(d)." Complaint for Declaratory and Injunctive Relief, filed Feb. 21, 1992, at 5 (emphasis added). Bank defendants assert that under 12 U.S.C. § 1848, the proper forum for judicial relief from a decision involving the Douglas Amendment2 is the court of appeals. Memorandum in Support of U.S. Bancorp and U.S. Bank of Idaho, N.A.'s Motion for Summary Judgment, filed March 2, 1992, at 4-6. They further argue that the Department's attempt to collaterally attack the decision of the Board by challenging the Comptroller's decision which approved the FNBS relocation, is only an attempt to get this court to tangentially review an issue statutorily reserved for the court of appeals. In addition, the defendants argue that it would be a waste of judicial resources for this court to address the same issue that is already pending before the Ninth Circuit Court of Appeals, as the Department has already requested judicial review of the Board's decision in that forum as well.3

The court notes that the Comptroller has also made this same jurisdiction argument in support of its motion to dismiss. The Comptroller argued that the precise legal question in this case"whether the Douglas Amendment applies to FNBS's relocation" — has already been decided by the Board and a review of that decision is currently pending before the Ninth Circuit Court of Appeals. Memorandum in Support of the Comptroller of the Currency's Motion to Dismiss or in the Alternative for Summary Judgment, filed March 10, 1992, at 6-7 (footnote omitted). The Comptroller, like the Bank defendants, argues that the Board has exclusive jurisdiction to make these decisions under the Bank Holding Company Act, and that judicial review of these decisions is the exclusive jurisdiction of the court of appeals. Id. at 7 (citing Whitney Nat'l Bank v. Bank and Trust Co., 379 U.S. 411, 419-23, 85 S.Ct. 551, 557-59, 13 L.Ed.2d 386 (1965); BankAmerica Corp. v. Board of Governors, 596 F.2d 1368, 1374 (9th Cir.1979); Memphis Trust Co. v. Board of Governors, 584 F.2d 921, 926 (6th Cir.1978).

The Comptroller also notes that even though the Department cites the National Bank Act for jurisdictional purposes, its claim for relief arises solely under the Douglas Amendment in that the Department has not alleged that the Comptroller violated any specific provision of the National Bank Act. Id. at 7, n. 9. The Comptroller argues that the Department cannot now try to circumvent the court of appeal's jurisdiction by attempting to assert a claim against the Comptroller, when the substance of the claim is the same; that is, whether or not the Board's decision regarding the requirements of the Douglas Amendment was a correct interpretation of the law. Id. at 8-9.

The Department, in response to the Bank defendants' motion, argues that this court does have jurisdiction in that the principal issue in the case is whether Section 30(b) of the National Bank Act, 12 U.S.C. § 30(b), is in conflict with the Idaho Financial Institution Acquisition Act (FIAA), Chapter 26, Title 26, Idaho Code. Brief in Opposition to Defendants' U.S. Bancorp and First National Bank in Spokane Motion for Summary Judgment, filed March 9, 1992, at 2. The Department asserts that it is this issue which presents a federal question that this court has jurisdiction to review. The Department then attempts to distinguish the cases cited by the Bank defendants as authority for their position. The Department cites the court to McEnteer v. Clarke, 638 F.Supp. 911, 912 (E.D.Pa.1986), for the proposition that the...

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