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Ragle v. Monticello Banking Co.

United States District Court, W.D. Kentucky, Bowling Green Division

June 12, 2014

ROBERT RAGLE, ET AL., Plaintiffs,


JOSEPH H. McKINLEY, Jr., Chief District Judge.

This matter is before the Court on Defendants Richard Owens and Sons Construction Company, Inc. ("Owens Construction") and Richard Owens' (in his individual capacity) Motion for Partial Summary Judgment [DN 60]. Plaintiffs responded to Owens (in his individual capacity) and Owens Construction's motion but Defendants failed to file a reply.


This action arises out of the alleged mishandling of Plaintiffs' account held by Monticello Banking Company, a party now dismissed from this case. [Mem. Op. and Order, DN 43]. Plaintiffs, Robert Ragle and Laura Ragle, initially filed this action in Russell Circuit Court on July 23, 2007. [Complaint, DN 1-1, at 1]. In 2011, Plaintiffs amended their Complaint in state court and added Richard Owens, in his individual capacity and official capacity as Director and President of Monticello Banking, and Owens Construction alleging violations of several federal banking regulations. [Complaint, DN 1-1, at 7]. These added allegations arose out of a construction loan Plaintiffs obtained from Monticello. Plaintiffs believe that Owens received "certain benefits that he was not due" because of his position at both Monticello Banking and president of the construction company the Plaintiffs hired. [Resp. to Mot. for Summ. J., DN 41, at 1].

On September 5, 2013, the Court issued a Memorandum Opinion and Order dismissing all claims under Regulation O, the Unfair and Deceptive Acts and Practices Act, Regulation AA, Real Estate Settlement Practices Act, and for wrongful dishonor of checks against Monticello and Owens (in his official capacity). [Mem. Op. and Order, DN 43]. In reliance on that Opinion, Owens (in his official capacity) and Owens Construction now move to dismiss the remaining federal banking claims.


Before the Court may grant a motion for summary judgment, it must find that there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The moving party bears the initial burden of specifying the basis for its motion and identifying that portion of the record that demonstrates the absence of a genuine issue of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 322 (1986). Once the moving party satisfies this burden, the non-moving party thereafter must produce specific facts demonstrating a genuine issue of fact for trial. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 247-48 (1986).

Although the Court must review the evidence in the light most favorable to the nonmoving party, the non-moving party must do more than merely show that there is some "metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp. , 475 U.S. 574, 586 (1986). Instead, the Federal Rules of Civil Procedure require the nonmoving party to present specific facts showing that a genuine factual issue exists by "citing to particular parts of materials in the record" or by "showing that the materials cited do not establish the absence... of a genuine dispute[.]" Fed.R.Civ.P. 56(c)(1). "The mere existence of a scintilla of evidence in support of the [non-moving party's] position will be insufficient; there must be evidence on which the jury could reasonably find for the [non-moving party]." Anderson , 477 U.S. at 252. It is against this standard the Court reviews the following facts.


A. Regulation O

Plaintiffs claim Defendants violated Regulation O, 12 C.F.R. § 215 (2013), which deals with the extension of credit by a regulated bank to an individual officer, director, principal or shareholder, or to a business owned by one of those insiders. 12 C.F.R. § 215.1. In moving for summary judgment on Regulation O, Defendants simply state that the Court previously determined that the regulation does not provide a private right of action. As noted in the Court's prior Opinion, the FDIC alones appears to be the enforcement arm of Regulation O, not individuals. [Mem. Op., DN 43, at 3]. Plaintiffs do not cite to any change in existing law that would suggest that a private party has a cause of action under Regulation O, and therefore, the Plaintiffs' claim under Regulation O is dismissed as to Owens (in his individual capacity) and Owens Construction.

B. Unfair and Deceptive Act and Practices Act and Regulation AA

Plaintiffs assert that Defendants violated the Unfair and Deceptive Act and Practices ("UDAP") under 15 U.S.C. § 45(a) (2012) and Federal Reserve Regulation AA under 12 C.F.R. 227 (2013). Plaintiffs separately identify these claims, but Regulation AA simply implements the provisions of UDAP. 12 C.F.R. 227.1 ("The purpose of [12 C.F.R. 227] is to prohibit unfair or deceptive acts or practices in violation of section 5(a)(1) of the Federal Trade Commission Act, 15 U.S.C. 45(a)(1)."). The Court previously dismissed this cause of action based on the holding in Holloway v. Bristol-Meyers Corp. , 485 F.2d 986 (D.C. Cir. 1971). ...

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