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Shea v. Office of Thrift Supervision

argued: March 8, 1991.


On Petition to Modify, Terminate, and Set Aside an Order of the Office of Thrift Supervision Entered on August 4, 1990.

Becker, Nygaard, Circuit Judges, and Clifford Scott Green, District Judge.*fn*

Author: Green


GREEN, District Judge

This case presents the petitioner's appeal of the August 24, 1990 order issued by the Office of Thrift Supervision (OTS) denying the petitioner's request to quash or modify the subpoenas duces tecum served in connection with a fraud investigation. The primary question is whether, without a final decision of the district court, this court has jurisdiction over this appeal pursuant to 12 U.S.C. § 1467a(j) of the Federal Home Loan Bank Act (FHLA), effective as of August 1989, or under the Administrative Procedures Act (APA) (5 U.S.C. § 704). The question of jurisdiction under 12 U.S.C. § 1467a(j) is an issue of first impression in this court. We conclude that this court does not have jurisdiction over the instant appeal under either provision.


The petitioner, Michael Shea, was a director of Colonial Savings Bank ("Colonial Savings"), of Roselle Park, New Jersey, from 1986 to 1989. Colonial Savings was subject to the regulations of the OTS. As the OTS states, it is authorized to "exercise certain of the investigative and enforcement powers set forth in the Federal Deposit Insurance Act ("FDIA"), as amended by the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 ("FIRREA")." In October of 1989, the OTS served an investigative subpoena*fn1 upon the petitioner which required him to testify and to produce certain personal and corporate records in connection with an investigation of his activities while he was employed by Colonial Savings. After Shea refused to answer the subpoena, OTS filed an action in the district court on May 1, 1990 seeking enforcement of the subpoena. Shea filed a cross motion to quash the subpoena. The district court expressed concern that the subpoena was too broad, and suggested that the OTS withdraw the subpoena, redraft, and issue a new subpoena. After the parties agreed to this plan,*fn2 the district court dismissed the enforcement proceeding without prejudice.

Instead of issuing one revised subpoena, on July 26, 1990, the OTS issued six separate investigative subpoenas duces tecum calling for the production of records in six different categories.*fn3 Shea and his counsel did not consider these subpoenas narrower than the first. In an attempt to exhaust his administrative remedies, Shea filed an application to quash or modify the six subpoenas with the OTS. The OTS denied Shea's application. App. at 178a. Shea then filed this petition to modify, terminate, or set aside the subpoenas duces tecum in the court of appeals pursuant to 12 U.S.C. § 1467a(j). At this point, OTS has not filed an action to enforce the subpoenas in the district court. The primary question before this court is whether, without a final decision by the district court, we have jurisdiction to consider this petition pursuant to the August 1989 revisions to 12 U.S.C. § 1467a(j) or under the Administrative Procedure Act, 5 U.S.C. § 704. Only if we determine that jurisdiction exists, can we consider the merits of this petition.


12 U.S.C. § 1467a(j) deals with the regulation of bank holding companies, and generally provides for the registration, examination, and if necessary, investigation of these organizations. In pertinent part 12 U.S.C. § 1467a(j) provides for judicial review of administrative orders in the following manner:

Any party aggrieved by an order of the Director under this section may obtain a review of such order by filing in the court of appeals of the United States for the circuit in which the principal office of such party is located, . . ., within 30 days after the date of service of such order, a written petition praying that the order of the Director be modified, terminated or set aside . . . Upon filing of such petition, such court shall have jurisdiction, which upon the filing of the record shall be exclusive, to affirm, modify, terminate, or set aside, in whole or in part, the order of the Director.

12 U.S.C. § 1467a(j) (Supp. 1991).

Since no court has specifically considered whether the term "order" in 12 U.S.C. § 1467a(j) is limited to a "final order," this court must closely examine the statutory language, and the arguments made and authorities cited by each party.

On its face, the statutory language suggests that any order issued by the director is reviewable. The respondent contends that the OTS's declination to quash or modify the subpoenas does not constitute an "order" as that term is defined in the Administrative Procedure Act, 5 U.S.C. § 551(6).*fn4 "Orders" are generally issued as a result of an adjudicatory proceeding, and not as a result of an investigative proceeding such as the one which was held in the case at bar. International Telephone & Telegraph Corp. v. Local 134, International Brotherhood of Electrical Workers, 419 U.S. 428, 443-44, 95 S. Ct. 600, 610, 42 L. Ed. 2d 558 (1975) (hereinafter ITT v. Local 134) (holding that the result of a hearing under § 10(k) of the National Labor Relations Act was not a final disposition with determinate consequences that fell within the definition of "order" under the APA, 5 U.S.C. § 551(6)). Further, the respondent notes that "the OTS's declination to quash the subpoenas lacks the requisite 'finality' to be an 'order,'" in part, because the decision did not have "determinate consequences" since the OTS would still have to bring an enforcement action in district court in order to act upon the subpoenas. See Respondent's Brief, at 21. Since ...

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