Charles Dubee v. j.p.morgan Chase & Co.

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
FILED
________________________
U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 11-13773 JAN 19, 2012
Non-Argument Calendar JOHN LEY
________________________ CLERK
D.C. Docket No. 4:10-cv-00112-WTM-GRS
GARY C. ARMS,
lllllllllllllllllllllllllllllllllllllllPlaintiff,
CHARLES DUBEE,
ANTHONY GIROUX,
GERRY GIROUX,
NATHAN GRAY,
JANENE RENEE GRAY,
DAVID SODERLINE,
WALTER SODERLINE,
FRAIN SIMPLIS,
STEPHANIE MILLER,
CHARLES MILLER,
llllllllllllllllllllllllllllllllllllllllPlaintiffs - Appellants,
versus
J.P. MORGAN CHASE & CO.,
llllllllllllllllllllllllllllllllllllllllDefendant - Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Georgia
________________________
(January 19, 2012)
Before CARNES, WILSON and MARTIN, Circuit Judges.
PER CURIAM:
This is an appeal of the district court’s grant of J.P. Morgan Chase & Co.’s
Federal Rule of Civil Procedure 12(b)(6) motion to dismiss. After thorough
review, we affirm the district court.
In 2007, Appellants got construction loans from Transland Financial
Services to finance housing developments in Savannah, Georgia. Appellants
allege that Transland concealed liquidity problems from them at the time they
entered into the contract, and dissolved very soon afterward without fully funding
the projects. Washington Mutual Bank (“WaMu”) acquired the loan contracts
from Transland, but itself declared bankruptcy in 2008 and was taken into
receivership by the FDIC. Later that year, the FDIC sold WaMu’s assets,
including the loan contracts at issue, to J.P. Morgan Chase & Co. (“Chase”) in a
Purchase and Assumption Agreement.
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Appellants filed suit in state court against Chase, seeking declaratory relief
and to quiet title. They claim that Chase is not entitled to collect the amounts due
on the loan contracts, because of fraudulent inducement on the part of Transland
as well as the failure of Transland and WaMu to disburse the loan proceeds.
Chase removed the case to federal court and filed a motion to dismiss for failure to
state a claim. The district court granted the motion, and this appeal followed.
We review de novo a district court’s dismissal of a complaint for failure to
state a claim. Rosenberg v. Gould, 554 F.3d 962, 965 (11th Cir. 2009). In so
doing, “we accept all well-pleaded facts as true, and we make all reasonable
inferences in favor of the plaintiff.” Thompson v. RelationServe Media, Inc., 610
F.3d 628, 631 n.5 (11th Cir. 2010). In ruling upon a motion to dismiss, a district
court may consider materials attached to pleadings if the materials are “(1) central
to the plaintiff’s claim, and (2) [their] authenticity is not challenged.” SFM
Holdings, Ltd. v. Banc of America Sec., LLC, 600 F.3d 1334, 1337 (11th Cir.
2010). Chase attached the Purchase and Assumption Agreement to its motion to
dismiss. Appellants do not challenge the district court's reliance on this document
in granting the motion, and in fact, they rely upon the Agreement in their own
brief.
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On appeal, Appellants raise a number of issues, including a challenge to the
district court’s conclusions regarding Chase’s status as a holder in due course
under 12 U.S.C. § 1823(e) and D’Oench, Duhme & Co. v. FDIC, 315 U.S. 447, 62
S. Ct. 676 (1942). However, we need not address this issue in order to affirm the
district court’s decision to dismiss the complaint. Section 2.5 of the Purchase and
Assumption Agreement between Chase and the FDIC makes clear:
[A]ny liability associated with borrower claims for payment of or
liability to any borrower for monetary relief, or that provide for any
other form of relief to any borrower, whether or not such liability is
. . . legal or equitable . . . whether asserted affirmatively or
defensively, related in any way to any loan or commitment to lend
made by the Failed Bank prior to failure . . . are specifically not
assumed by the Assuming Bank.
The district court ruled consistent with the Agreement that when Chase purchased
the loan contracts, it did not acquire any liabilities associated with those
contracts.1
Appellants argue that Section 2.5 of the Agreement does not bar their claim,
because by bringing a declaratory action to determine the “validity of the assets
that Chase acquired from the FDIC,” they have not sought to impose a liability on
Chase. This argument fails. The Agreement expressly includes within its
1
In making this statement, we express no opinion as to whether those liabilities remained
with the FDIC at the time of purchase, or whether the FDIC acquired a quasi-holder in due
course status under 12 U.S.C. § 1823(e).
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definition of liability, “any . . . form of relief to any borrower,” whether that relief
is “legal or equitable,” or “asserted affirmatively or defensively.” Thus,
Appellants’ action to secure relief from their contractual obligation to repay the
loans falls squarely within the terms of Section 2.5 of the Agreement.
Appellants also turn our attention to Section 3.3 of the Agreement, which
states, “THE CONVEYANCE OF ALL ASSETS . . . SHALL BE MADE . . . ‘AS IS’ [AND]
WITHOUT RECOURSE AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN THIS
AGREEMENT, WITHOUT ANY WARRANTIES . . . WITH RESPECT TO . . .
ENFORCEABILITY, [OR] COLLECTIBILITY.” Appellants argue that this provision
denies Chase all warranties as to the enforceability of the loan contracts. Be that
as it may, this language does not negate Section 2.5 of the Agreement, by which
Chase expressly did not assume any liabilities associated with the loan contracts.
Instead, it disclaims certain rights that Chase might otherwise have against the
FDIC. Thus, the disclaimer in Section 3.3 of the Agreement does nothing to alter
Appellants’ rights under the loan contracts acquired by Chase.
For the aforementioned reasons, we AFFIRM the district court’s order.
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