Bryant v. Plains National Bank of Lubbock

Full title: DONALD S. BRYANT, JR., a Married Person, as Trustee of the Bryant Family…

Court: United States District Court, N.D. Texas, Lubbock Division

Date published: Jan 7, 2005

CIVIL ACTION CAUSE NUMBER 5:04-CV-048-J (N.D. Tex. Jan. 7, 2005)

Opinion

CIVIL ACTION CAUSE NUMBER 5:04-CV-048-J.

January 7, 2005

MEMORANDUM OPINION AND ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

MARY ROBINSON, District Judge

Before the Court are Defendants' motion, filed October 25, 2004, for summary judgment on all claims asserted herein against all Defendants, and the responses and replies thereto. For the following reasons, Defendants' summary judgment motion is granted.

Background

Plaintiff Trustees Donald Bryant and Linda Bryant had two bank accounts in the name of the "Bryant Family Trust" at Plains National Bank. Approximately $360,000.00 in these accounts was seized by the FBI pursuant to the 1986 Monetary Control Act. Plaintiffs allege that Plains National Bank through its officers and directors engaged in conspiracies to defraud the Bryants and their family trust. Plaintiffs allege that bank officers accused Mr. Bryant to federal agents of being a suspected launderer of drug money and/or being involved in other suspected criminal activities. Plaintiffs allege these conspiracies were effectuated by one or more employees of Plains National Bank contacting the FBI on or about May 9, 2002, to report possible illegal activities related to Plaintiffs' bank accounts.

Plaintiffs sue the spouses of the bank's officers and directors because of the community property laws of the State of Texas. Plaintiffs do not allege that these spouses actively engaged in any conspiracy or fraud.

Legal Standards

The Court may terminate litigation by rendering a summary judgment where no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986) (initial burden is on movant to show entitlement to summary judgment with competent evidence). A material fact issue is one that might affect the outcome of the suit under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The party opposing judgment must point the Court to "specific facts with sufficient particularity to meet all the elements necessary to lay a foundation for recovery, including those necessary to negate the defense" offered by movant. Brown v. Texas AM University, 804 F.2d 327, 333 (5th Cir. 1986)./¹

1 Accord Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986); Celotex Corp., 477 U.S. at 323-25, 106 S.Ct. at 2553; Liberty Lobby, Inc., 477 U.S. at 247-48, 106 S.Ct. at 2510. The nonmoving party must designate specific facts showing there exists a genuine issue of material fact on those elements sought to be negated by the movant. Ibid.

Discussion and Analysis

All of the Defendants move for summary judgment on all of the Plaintiffs' claims. Defendants first argue that Plaintiffs' claims are barred by the statutory immunity granted to banks, bank officers, bank directors and bank employees when they voluntary report possible violations of law or banking regulations to a government agency./² Defendants also move for judgment because Plaintiffs have failed to come forward with any evidence on any of the essential elements of their claims for fraud, breach of fiduciary duty, conspiracy, collusion, obstruction of justice, and alleged RICO violations.

In response to the Defendants' motion, Plaintiffs have brought forth no competent summary judgment evidence supporting any of their claims for fraud, breach of fiduciary duty, conspiracy, collusion, obstruction of justice, and/or any alleged violations of RICO./³ Plaintiffs have not even responded with detailed allegations of fact in support of their claims. For this reason summary judgment may be entered on these claims.

3 Plaintiff Donald Bryant stated in his unsworn deposition that he had no evidence to support his claims and that he could not remember the details of what evidence he at one time had, because all of his evidence had been voluntarily turned over to the Federal Bureau of Investigation.

In addition, Defendants are correct that they are entitled to limited statutory immunity when voluntarily reporting possible violations of federal law and/or banking regulations to a government agency. The Annunzio-Wylie Anti-Money Laundering Act of 1992, 31 U.S.C. § 5318(g), provides in relevant part:

(g) Reporting of suspicious transactions. —

(1) In general. — The [Treasury] Secretary may require any financial institution, and any director, officer, employee, or agent of any financial institution, to report any suspicious transaction relevant to a possible violation of law or regulation.

(2) Notification prohibited. — A financial institution, and a director, officer, employee, or agent of any financial institution, who voluntarily reports a suspicious transaction, or that reports a suspicious transaction pursuant to this section or any other authority, may not notify any person involved in the transaction that the transaction has been reported.

(3) Liability for disclosures. — Any financial institution that makes [i] a disclosure of any possible violation of law or regulation or [ii] a disclosure pursuant to this subsection or [iii] any other authority, and any director, officer, employee, or agent of such institution, shall not be liable to any person under any law or regulation of the United States or any constitution, law, or regulation of any State or political subdivision thereof, for such disclosure or for any failure to notify the person involved in the transaction or any other person of such disclosure.

The three safe harbor provisions of § 5318(g) (3) supply an affirmative defense to claims against a financial institution and its employees, officers and/or directors for disclosing an individual's financial records or account-related activity. Financial institutions are granted by this statute immunity from liability for three different types of disclosures:

(1) A disclosure of any suspected or possible violation(s) of and State or federal law or regulation,

(2) A disclosure pursuant to any of the anti-money laundering or other regulatory provisions of § 5318 itself, or

(3) A disclosure pursuant to any other legal authority.

See 31 U.S.C. § 5318(g) (3).

The safe harbor provisions of § 5318(g), supplying an affirmative defense to claims against a financial institution for disclosing any individual's financial records or account-related activity, are not limited to currency transactions. Those provisions protect the disclosure of a suspected violation of law regardless of whether it involves a cash transaction, electronic transfers, or any other type of transaction. Lopez v. First Union Nat. Bank of Florida, 129 F.3d 1186, 1191-92 (11^th Cir. 1997). To the extent that Plaintiffs claim a breach of fiduciary duty, conspiracy or fraud based upon some alleged affirmative representation or misrepresentation by a bank officer that funds transferred into their trust accounts by "federal wire" or electronic transfers fall outside these safe harbor provisions, such claims are not exempt from the statutory grant of immunity from liability to the Plaintiffs.

Additionally, Plaintiffs have not shown the existence of any fiduciary relationship between themselves and the bank under the facts alleged in this case. See Crutcher v. Continental Nat'l Bank, 884 S.W.2d 884, 886 (Tex.App.-El Paso 1994, writ denied); Manufacturers Hanover Trust Co. v. Kingston Invertors Corp., 819 S.W.2d 607, 610 (Tex.App.-Houston [1^st Dist.] 1991, no writ) (as a general rule banks and their account customers do not have such a special or confidential relationship rising to the level of imposing fiduciary duties upon the bank). Such a showing is required to prevail an their breach of fiduciary duty claim.Dearing, Inc. v. Spiller, 824 S.W.2d 728, 733-34 (Tex.App. — Fort Worth 1992, writ denied) (showing of a fiduciary relationship is required before alleged breach can be actionable). For this additional reason summary judgment is granted to all Defendants on this claim.

Finally, Plaintiffs' claims against the Defendant Spouses are not independent causes of action brought against the spouses. Because Plaintiffs have brought forth no evidence to support their claims against the spouses and because Plaintiffs can not prevail against the Bank or its officers, directors or employees for the reasons set forth above, summary judgment is granted to all of the Defendant Spouses on all claims asserted herein.

Conclusions

For all of the foregoing reasons, summary judgment is entered in favor of all of the Defendants on all of the Plaintiffs' claims.

Final judgment will be entered in accordance with this opinion and order.

It is SO ORDERED.