First Republic ex-employees' lawsuit against US FDIC is dismissed
A federal judge in California dismissed a lawsuit accusing the Federal Deposit Insurance Corp (FDIC) of improperly blocking nearly 170 former employees of the failed First Republic Bank from accessing at least $150 million of retirement funds.
U.S. District Judge Haywood Gilliam ruled on Friday that a federal law enacted after the 1980s savings and loan crisis gave the FDIC broad authority to act as receiver for failed banks, and prevented him from getting involved.
Lawyers for the former employees did not immediately respond to requests for comment. An FDIC spokesman declined to comment.
First Republic failed on May 1, 2023, after a series of Federal Reserve interest rate increases caused large losses in its investment portfolio and led many depositors to move their money elsewhere.