Earlier this month, a federal judge ruled against the Federal Deposit Insurance Corporation (FDIC), applied the business judgment rule and granted summary judgment in favor of nine former directors and officers of a North Carolina community bank seized by the FDIC in 2009. The court applied North Carolina’s business judgment rule and found that documentary and testimonial evidence demonstrated that the defendants acted in good faith, exercised due diligence, and employed a rational process in approving dozens of loans challenged by the FDIC.
The decision confirms the long standing principle that directors and officers who exercise their business judgment in making decisions, even if those decisions later turn out to be problematic, will not be held personally liable. The court dismissed the FDIC’s claims in their entirety and granted judgment in favor of the directors and officers.
News of the victory was featured in American Banker on September 16, 2014.
The bank was represented by a team of Venable attorneys including Tom Gilbertsen, David Goewey, who passed away in December 2013, Ron Glancz, Meredith Boylan, Michael Bracken, and Andrew Hernacki.
The decision confirms the long standing principle that directors and officers who exercise their business judgment in making decisions, even if those decisions later turn out to be problematic, will not be held personally liable. The court dismissed the FDIC’s claims in their entirety and granted judgment in favor of the directors and officers.
News of the victory was featured in American Banker on September 16, 2014.
The bank was represented by a team of Venable attorneys including Tom Gilbertsen, David Goewey, who passed away in December 2013, Ron Glancz, Meredith Boylan, Michael Bracken, and Andrew Hernacki.