Alltel Information Services, Inc. v. Federal Deposit Insurance Corp.

This case involved cross-motions for summary judgment. I agree that ALLTEL may not recover its expectation under the contract as compensation for the substantial costs that it claims to have incurred in preparation for performance, and would affirm the denial of its motion for summary judgment.

I do not believe, however, that the FDIC is entitled to summary judgment as there is a triable issue of fact concerning the damages to which ALLTEL is entitled for reimbursement of its costs in preparation for performance of the contract.

I realize that ALLTEL limited its argument to the contention that it was entitled to the full amount it expected to receive for performance of the five-year contract, but that argument necessarily subsumed that it was entitled to the lesser amount of its actual expenditures in preparation for performance.

I disagree with the majority’s apparent conclusion that the waiver rule bars consideration of whether these preparation expenses are compensable under another theory of damages. See Maj. Op. at 1043 n. 9. This court has considered issues raised for the first time on appeal in “those cases in which the courts below were not presented with and did not…

Opinion by Judge TASHIMA; Dissent by Judge BOOCHEVER.

ALLTEL Information Services, Inc., and its wholly owned subsidiary, ALLTEL Financial Information Services, Inc., (collectively “ALLTEL”) appeal the district court’s grant of summary judgment in favor of the Federal Deposit Insurance Corporation (“FDIC”). ALLTEL entered into two contracts with Pacific Heritage Bank (“Pacific Heritage”) to provide certain services. Soon thereafter, Pacific Heritage was declared insolvent, and the *1038 FDIC became its receiver. The FDIC repudiated Pacific Heritage’s contracts with ALLTEL, pursuant to its authority under the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (“FIRREA”) and allowed only a portion of the damages ALLTEL claimed. The district court concluded that ALLTEL’s claim for the disallowed portion was barred by 12 U.S.C. § 1821 (e) (1999), which limits the FDIC’s liability to “actual direct compensatory damages.” See ALLTEL Info. Servs., Inc. v. FDIC, 970 F.Supp. 775 (C.D.Cal.1997). We have jurisdiction pursuant to 28 U.S.C. § 1291 , and we affirm.

I. Background

On February 5, 1995, ALLTEL 1 entered into a five-year contract with Pacific Heritage under which…