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Pantano v. Federal Deposit Insurance Corporation

United States District Court, N.D. Illinois, Eastern Division

February 7, 2014

DENNIS PANTANO, as Independent Administrator of the Estate of Marie Sasso, Deceased, as of Co-Trustee of the Marie M. Sasso Trust dated August 15, 2001, AS Restated on October 21, 2005, and MICHAEL MANNO, as Co-Trustee of the Marie M. Sasso Trusted dated August 15, 2001, and Restated on October 21, 2005, Plaintiffs,
v.
FEDERAL DEPOSIT INSURANCE CORPORATION, in its corporate capacity as deposit insurer of First Chicago Bank & Trust, f/k/a LABE BANK, Defendant.

MEMORANDUM OPINION AND ORDER

ROBERT W. GETTLEMAN, District Judge.

In a Second Amended Complaint, plaintiffs Dennis Pantano, as Independent Administrator of the Estate of Marie M. Sasso, deceased, and as Co-Trustee of Marie M. Sasso Trust (the "Trust"), and Michael Manno as Co-Trustee of the Trust, seek review of the denial by defendant Federal Deposit Insurance Corporation in its corporate capacity ("FDIC-C") of plaintiffs' claim for deposit insurance on accounts maintained in a failed financial institution. The parties agree that the operative material facts are not in dispute and have filed a joint statement of facts and cross-motions for summary judgment. Because the FDIC-C's decision was not arbitrary or capricious, the court grants its motion for summary judgment and denies plaintiffs' motion for summary judgment.

BACKGROUND

On August 15, 2001, Marie M. Sasso executed the Trust, which was restated on October 21, 2005. Marie was the sole trustee until her death on September 10, 2008. As trustee Marie maintained certain bank accounts including Account No. 1889 at First Chicago Bank and Trust (the "Account"). The Account was designated in the name of Marie M. Sasso as Trustee of the Marie M. Sasso Trust.

On September 19, 2008, nine days after Marie's death, a transfer from another trust account was made in the amount of $16, 246 into the Account. On October 6, 2008, a second deposit for in the amount of $59, 590.32 from another trust account was made into the Account.

After Marie's death on September 10, 2008, checks totaling $89, 524.04 were made payable to Gary Sasso or for his benefit bearing the signature of Marie M. Sasso and drawn on an account at First Chicago in the name of the Trust. Gary Sasso is Marie's son and beneficiary of the Trust. The checks were all presented for payment after Marie's death and honored by First Chicago.

On September 24, 2008, the balance of the account was $21, 556.47. On October 24, 2008, the balance of the Account was $901.36, and on November 25, 2008, the balance on the Account was $823.36.

On January 5, 2009, Gary Sasso filed a petition for probate of Marie's estate in the Circuit Court of Cook County, Illinois (the "probate proceedings"). Letters of Office were issued to Gary eleven days later.

Gary was removed as the Independent Representative of the Estate on August 31, 2009, because he had obtained the Letters of Office under false pretenses due to a previous conviction for felony forgery. Plaintiff Pantano was appointed the Independent Representative.

On July 23, 2010, plaintiffs initiated supplemental proceedings in the probate court to recover from First Chicago the amount of $89, 524.04 for allegedly unauthorized and improper withdrawals, check payments, and charges made against the Trust Accounts after Marie's death. One year later, on July 8, 2011, the Illinois Department of Financial and Professional Regulation closed First Chicago and appointed the FDIC as Receiver. As a result of the closure, the supplemental proceedings in the probate court were dismissed.

After the closure, plaintiffs submitted a claim for deposit insurance to FDIC-C, seeking the $89, 524.04 representing the withdrawals from the Trust Accounts after Marie's death. To support their claim, plaintiffs submitted bank statements for the Account for the periods of September 25, 2008, through November 25, 2008. Plaintiffs also submitted copies of a number of checks written on the Account that were dated and paid after Marie's death:

(1) Check No. 336 in the amount of $14, 300 dated July 22, 2008, payable to Gary Sasso, presented and paid on September 29, 2008;
(2) Check No. 338 in the amount of $9, 174.35 dated July 22, 2008, payable to Illinois State Disbursement Unit, presented and paid on September 23, 2008;
(3) Check No. 361 in the amount of $78 dated October 7, 2008, payable to the Illinois Secretary of State, presented ...

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