Wright, Bork and Scalia, Circuit Judges. Dissenting opinion filed by Circuit Judge Wright.
The Federal Deposit Insurance Corporation appeals from a district court order -- in the form of a discovery order -- compelling it to enjoin a third party's allegedly illegal conduct and to consider, then rule upon the merits of, a petition filed by the Investment Company Institute which seeks to have that third party's conduct declared unlawful. We find the district court's order an injunction appealable under 28 U.S.C. § 1292(a) (1) (1976). We also hold that the substance of the court order exceeded that court's power and authority under the federal banking laws. I.
In the spring of 1982, the Boston Five Cents Savings Bank ("Bank") devised a plan to sell mutual fund shares through wholly owned subsidiaries. On April 13, appellee, the Investment Company Institute , petitioned the Federal Deposit Insurance Corporation to declare this plan unlawful and to prevent the Bank from implementing it. FDIC held a public meeting of its Board of Directors on May 17 and declined to decide the merits of ICI's petition. It informed appellee of this action by letter of May 20, pointing out that the Bank had not yet submitted any application for approval of mutual fund activities.
Upon receiving FDIC's letter, ICI filed the present suit claiming (1) an abuse of discretion by FDIC in violation of the Administrative Procedure Act, 5 U.S.C. § 706(2) (1982), and (2) a violation of the Sunshine Act, 5 U.S.C. § 552b (1982), based upon the allegation that the public meeting was merely pro forma and validated action that had been agreed upon in private beforehand. On May 23, appellee moved the court to shorten the discovery period, to require the production of certain documents by May 27, and to allow the scheduling of three depositions for May 28. The district court denied FDIC's ensuing request for a protective order, and granted all ICI's requests for expedited discovery. In early June, ICI moved to compel FDIC to produce several documents and answers to deposition questions, at the same time moving to shorten FDIC's time for response to the motion to four days. The district court granted the motion to shorten without an opportunity for reply by appellants.
FDIC did respond within the four-day limit, however, and requested a hearing on the motion. The district court denied the requested hearing, and on June 22, issued a discovery order requiring compliance with all ICI's discovery demands within three days. Appellant moved to dismiss or
ORDERED, that defendants' motion to dismiss this action or, in the alternative, for reconsideration of this Court's Order of June 22, 1982, be and hereby is, DENIED, and it is
FURTHER ORDERED, that defendant Federal Deposit Insurance Corporation shall convene a meeting open to public observation, as required by the Government in the Sunshine Act, to consider the Petition of the Investment Company Institute with respect to the Boston Five Cents Savings Bank (the "Bank") and shall (1) rule upon the merits of each violation of law alleged in the plaintiff's April 13, 1982 Petition; (2) afford all interested persons, including the plaintiff, an opportunity to be heard in connection with the plaintiff's Petition; (3) issue a written opinion on the merits of the plaintiff's Petition, which shall be subject to review by this Court; and (4) require the Bank, its subsidiaries, agents, representatives and all persons or entities acting in concert with the Bank, not to proceed to implement its plan to sell shares of any mutual fund to the public until the FDIC has ruled on the plaintiff's Petition, and it is
FURTHER ORDERED, that further proceedings on the plaintiff's complaint, and the effectiveness of this Court's June 22, 1982, Order, are stayed pending the filing with the Court of defendants' ruling on the plaintiff's Petition, in accordance with this Order, and it is
FURTHER ORDERED, that defendants shall produce forthwith to the Court under seal for safekeeping all documents covered by the Court's May 27, 1982 and June 22, 1982 Orders, and it is
FURTHER ORDERED, that defendants shall preserve all records relating to the Bank or the Institute's Petition until further order of this Court, and it is
FURTHER ORDERED, that this Court be and hereby retains jurisdiction over this action, pending further order of this Court.
Investment Company Institute v. Federal Deposit Insurance Corp., No. 82-1408 (D.D.C. June 25, 1982). FDIC immediately appealed this Order, filing a notice of appeal on ...