Federal Deposit Insurance Corp. v. State Bank of Virden

893 F.2d 139 (1990) | Cited 23 times | Seventh Circuit | March 5, 1990

Before Hon. FRANK H. EASTERBROOK, Circuit Judge, Hon. KENNETH F. RIPPLE, Circuit Judge, Hon. JESSE E. ESCHBACH, Senior Circuit Judge


Virden seeks rehearing on the ground that we overlooked a written promise that Farmersville breached, which would not require it to look behind the documents of the failed bank. Farmersville promised to pay Virden pro rata from Atwater Grain receipts. Farmersville also promised State Bank of Girard, owner of another participation in the Atwater Grain loan, that it would be "on a first out basis"-that is, would be paid ahead of other participants.

For two reasons we think this argument insufficient to justify rehearing. First, Virden did not mention this written representation in its opening brief, pointing to it only in passing at page 6 of the reply brief. This is not enough. Second, Farmersville's promise to pay Girard ahead of Virden is not a reason to rescind the whole Atwater Grain participation, as Virden attempted to do, but is a reason to recover as damages (or setoff) the amount that Virden would have received had it been treated pro rata according to the terms of its participation. Virden elected to litigate this appeal on an all-or-nothing basis and will be held to its choice.

The petition for rehearing is denied.

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