against the former officers and directors to FDIC in its
corporate capacity. FDIC in its corporate capacity then
brought suit against the former officers and directors.
The defendants attempted to assert the affirmative defense
of contributory negligence claiming that the FDIC as receiver
had failed to maximize the recovery available on a number of
bad loans after the bank's failure. The court cited
Roy with approval and found that FDIC as receiver owed no duty
to the officers and directors to collect bad loans without
negligence. In addition, the court cited a long line of cases
holding that FDIC has no duty to warn banks of improprieties
its examinations reveal in order to protect the bank from
losses. See, e.g., First State Bank of Hudson County v. United
States, 599 F.2d 558 (3d Cir. 1979); Harmsen v. Smith,
586 F.2d 156 (9th Cir. 1978); Federal Deposit Insurance Corp. v.
Butcher, 660 F. Supp. 1274 (E.D.Tenn. 1987); Federal Savings and
Loan Insurance Corp. v. Williams, 599 F. Supp. 1184 (D.Md.
Evidence purporting to diminish the FDIC's right of recovery
by virtue of decisions made by it in connection with the
collection of the assets of the Coffeen National Bank is
immaterial to the issues in the case at bar. Thus, Plaintiff's
motion in limine will be allowed.
II — Propriety of Expert Testimony
Also before the Court is a matter styled "Memorandum of
Defendants on Propriety of Expert Testimony." Defendants seek
to limit the use of expert testimony by Plaintiff for several
reasons. First, Defendants allege that the loan transactions
in issue are not complicated, that the average juror would
have no difficulty understanding the issues, and that expert
testimony will be unduly prejudicial.
"If scientific, technical, or other specialized knowledge
will assist the trier of fact to understand the evidence or to
determine a fact in issue, a witness qualified as an expert by
knowledge, skill, experience, training, or education, may
testify thereto in the form of an opinion or otherwise."
Fed.R.Evid. 702. The Court finds that expert testimony will
assist the trier of fact to understand the evidence or
determine facts in issue. Thus, expert testimony is proper.
Second, Defendants cite Panter v. Marshall Field & Co.,
646 F.2d 271 (7th Cir. 1981), cert. denied, 454 U.S. 1092, 102
S.Ct. 658, 70 L.Ed.2d 631 (1981), for the proposition that the
Seventh Circuit has indicated that expert testimony on the
standard of conduct expected of directors should not be
permitted. The Court, however, does not agree with Defendants'
characterization of Panter. The Panter court simply stated that
an expert may not usurp the court's function of determining the
appropriate legal standard to apply in judging a defendant's
conduct. The parties may be assured that no one will be allowed
to usurp the Court's function.
Finally, Defendants assert that Plaintiff's proposed expert
witness is not qualified to testify as an expert and that the
evidence does not support the Plaintiff's proposed
hypothetical questions to its expert. Obviously, it would be
premature for the Court to rule on these issues.
Ergo, for the reasons discussed above, the motion in limine
filed on behalf of Plaintiff, Federal Deposit Insurance
Corporation, is ALLOWED. Treating Defendants' memorandum of law
on the propriety of expert testimony as a motion in limine, the
motion is DENIED.
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