Last week, the U.S. District Court for the Eastern District of Missouri denied a plaintiff’s attempt to enjoin an FDIC enforcement proceeding against him. The plaintiff claimed that the FDIC proceedings violated his Seventh Amendment right to a jury trial, and that the structure of the FDIC board of directors is unconstitutional. The court held that it lacked subject matter jurisdiction over the claim, because the Financial Institutions Supervisory Act (FISA) explicitly prohibits federal courts from exercising jurisdiction to grant injunctive relief to stop or otherwise affect an ongoing FDIC enforcement action.
The Eastern District of Missouri found that FISA’s preclusion provision, which divests courts of jurisdiction to grant equitable relief, prevented it from hearing the case. The court reasoned that FISA permits district court judicial review of FDIC enforcement actions in three circumstances: (1) in cases where the FDIC petitions district courts for enforcement of an effective and outstanding notice or order; (2) challenges to “the FDIC’s temporary suspension of deposit insurance, an agency’s issuance of an emergency temporary cease and desist order, or a temporary suspension of an institution-affiliated party while a proceeding is pending”; and (3) review of final agency enforcement orders.
The court found that because the plaintiff’s case challenged the investigatory demand rather than the result of the enforcement proceeding, it did not fall into the third category. Thus, the district court concluded that those “who wish to raise constitutional challenges must raise them with the Court of Appeals, either to the D.C. Circuit or to the circuit where the bank’s home office is located, at the conclusion of the proceeding.”
Because the Court determined it did not have subject matter jurisdiction over the plaintiff’s claim, it dismissed the case without addressing the plaintiff’s constitutional questions.