Meritage Homes of Nevada V. FDIC

The Federal Deposit Insurance Corporation may satisfy judgments against it with receiver's certificates as opposed to cash.

Appellant Meritage Homes of Nevada, Inc. (“Meritage”) filed suit against the Federal Deposit Insurance Corporation (“FDIC”) claiming that the FDIC has been unjustly enriched as a result of the non-payment of a debt that FDIC was liable to Meritage for. The district court ruled in favor of Meritage and ordered the FDIC to pay Meritage $436, 357.12. The FDIC complied by sending a receiver’s certificate in the appropriate amount of the judgment to Meritage, and also filed a Satisfaction of Judgment with the district court. Meritage responded by filing a motion to strike the Satisfaction of Judgment to impose payment in cash for FDIC’s liability. The district court found that the receiver’s certificate satisfied the judgment and denied the motion to Strike. On appeal, the Ninth Circuit observed that the legal basis for Meritage’s motion to strike is unclear and appears to be an attempt to amend the judgment. The standard of review for amending a judgment is abuse of discretion, which is the standard that the panel employs. In determining whether the district court abused its discretion, in finding that the receiver’s certificate satisfied the judgment against FDIC, the panel used a two-part test. The first prong of the test requires a determination of whether the lower court identified the correct legal rule to apply to the relief requested. The panel concluded that the trial court in concluding that a party with a money judgment against the FDIC may be paid with receivers certificates instead of cash, employed the correct rule. The Second prong of the test requires an examination of the lower court’s application of legal standards to determine if they acted illogically, or without support of proper inferences from the record. The Court held that the lower court did not act illogically or without support and therefore did not abuse its discretion. AFFIRMED.