Salinas Valley Community Federal Credit Union v. National Credit Union Administration

MEMORANDUM AND ORDER

I. INTRODUCTION

In this action, plaintiff seeks a preliminary injunction to prevent the National Credit Union Administration from liquidating plaintiff Salinas Valley Federal Credit Union without first affording plaintiff an adequate opportunity to present grounds and reasons why its charter should be restored and why it should not be placed in involuntary liquidation. On April 22, this court issued an order temporarily restraining defendant from making payment on insured accounts or payments to any other claimants against the assets of the credit union and from taking any other action that would render impracticable the restoration of plaintiff’s charter and the resump *703 tion of plaintiff’s operations. Plaintiff contends that the due process clause of the fifth amendment requires that the NCUA provide the credit union with a hearing prior to the irreparable revocation of its charter and its involuntary liquidation. Although the constraints of due process generally require, at the minimum, that some form of notice and opportunity for informal response be made available prior to the extinguishment of a person’s property interest, we hold that, in order to…