WASHINGTON (CN) - The Federal Circuit affirmed a $76.5 million damage award granted to Fifth Third Bancorp for its role in bailing out failing thrifts during the savings-and-loan crisis of the 1980s.
Fifth Third claims the government broke several promises made to Citizens Federal Bank when it and other banks, at the urging of government regulators, stepped up to buy one or more failing thrifts during the S&L debacle.
Regulators promised that the banks could offset the risk with a "supervisory goodwill" that would count toward the minimum regulatory capital requirement. But the government withdrew that promise with the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, which banned supervisor goodwill and caused once-healthy banks to suffer serious losses trying to meet the new requirements. The banks' lawyers and accountants "were most creative in finding multiple losses based on damages theories," the ruling states.
The government "doggedly fought" the bank's lawyers "every step of the way," resulting in eight published opinions in a trial court and an earlier federal appeals court decision.
The circuit upheld the damages award, noting that $76.5 million is a "relatively modest sum" in the context of the S&L litigation.
Plager added that the appellate judges "appreciate the trial court's patient, thorough and exhaustive work in this long-running case."
Read the Top 8
Sign up for the Top 8, a roundup of the day's top stories delivered directly to your inbox Monday through Friday.
Additional Reads
-
Legacy of America’s last slave ship explored in new film October 20, 2022 -
-
7th Circuit Nixes $44.7M Award to Man Shot by Off-Duty Cop February 23, 2021 -
