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RESOLUTION TRUST CORP. v. LUTZ

February 12, 1996

RESOLUTION TRUST CORPORATION
v.
ALFRED J. LUTZ, JR.



The opinion of the court was delivered by: JOYNER

 JOYNER, J.

 FEBRUARY 12, 1996

 Before this Court is Plaintiff Resolution Trust Corporation's ("RTC") Motion for Summary Judgment. *fn1" The RTC's claim is for $ 127 million from the Defendant, Alfred J. Lutz, Jr., a director and officer of Hill Financial Savings Association ("Hill"). It alleges that in that capacity, Lutz was grossly negligent under 12 U.S.C. § 1821(k) (1989 & Supp. 1995) and breached his fiduciary duties under 15 Pa. Cons. Stat. Ann. §§ 511-518 (1995).

 While Lutz was director and president of Hill, he was instrumental in making over $ 300 million in bad loans to several entities. In 1992, he pleaded guilty to criminal charges of willful misapplication of bank funds in three loans amounting to $ 222 million and admits that Hill's losses on those loans total at least $ 80 million. The RTC seeks a recovery of that $ 80 million. In addition, the RTC seeks recovery of an alleged $ 47 million in losses incurred on $ 82 million worth of loans known as the Emerald Coast loans.

 The RTC originally filed its Motion for Summary Judgment on September 28, 1995. When no response was received, this Court granted Lutz, a pro se defendant, an additional thirty days to respond. On the day this extension expired, Lutz faxed a letter to this Court stating that his response had been delayed due to difficulties associated with being in prison, such as mail delays, and that he had been unable to obtain paperwork from his former attorney. Over a month has passed since that letter and Lutz has not communicated with this Court again.

 While we are sympathetic to any difficulties Lutz has experienced in responding to this Motion, at this point we conclude that he does not contest the Motion. He has presented no opposition or evidence to this Court, not even his own affidavit, he has made no attempt to communicate with this Court, nor has he requested this Court's assistance in obtaining files from his former attorney. We turn now to the Motion.

 Standard of Review

 In considering a motion for summary judgment, a court must consider whether the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, show there is no genuine issue of material fact, and whether the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). The court must determine whether the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).

 In making this determination, all of the facts must be viewed in the light most favorable to the non-moving party and all reasonable inferences must be drawn in favor of the non-moving party. Id. at 256. Once the moving party has met the initial burden of demonstrating the absence of a genuine issue of material fact, the non-moving party must establish the existence of each element of its case. J.F. Feeser, Inc. v. Serv-A-Portion, Inc., 909 F.2d 1524, 1531 (3d Cir. 1990), cert. denied, 499 U.S. 921, 113 L. Ed. 2d 246, 111 S. Ct. 1313 (1991) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986)).

 Because Lutz has not responded to this Motion we only have the RTC's evidence before us. We will construe this evidence in the light most favorable to Lutz and determine from it whether there is a genuine issue of material fact.

 12 U.S.C. § 1821(k)

 Section 1821(k) provides that a "director or officer of an insured depository institution may be held personally liable for monetary damages . . . for gross negligence, including any similar conduct that demonstrates a greater disregard of a duty of care." It also provides for recovery of damages, including principal losses and appropriate interest. Id. In Pennsylvania, gross negligence is "substantially more than carelessness, inadvertence, laxity, or indifference. The behavior of the defendant must be flagrant, grossly deviating from the ordinary standard of care." Resolution Trust Corp. v. Gross, 1994 Westlaw 570153 at *3 (E.D. Pa. Oct. 13, 1994).

 First, the RTC's evidence is that Lutz pleaded guilty to three counts of willful misapplication of bank funds for loans totalling $ 222 million. Lutz admitted these loans resulted in a loss of $ 80 million to Hill. Even construing all the evidence in favor of Lutz, there is no genuine issue of material fact that his actions were ...


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