Petition for Writ of Certiorari — Donohoo v. United States

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NOFFICE OF Tis OLERK

In The

Supreme Court of the United States

October Term, 2001

RICHARD D. DONOHOO,

Petitioner,

vs.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATE COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

RICHARD D. DONOHOO

2116 Second Avenue South

Minneapolis, Minnesota 55404

(612) 874-7071

Attorney for Petitioner

2001 - Executeam +» 2573 N. Hamline Ave. * St Paul MN 55113 + 800-747-8793 + 651-633-1443

ves

A. Questions for Review

1. Does the statute of limitations as specified in

28 United States Code §2642 commence with the date of

the claimed violation?

2. Under the provisions of 28 United States

Code §2642, is the date of the violation the date when the

claim first accrued?

3. Does the decision of the Eighth Circuit

conflict with the decision of this Court in Unexcelled

Chemical Corp v. United States, 345 U.S. 59, 73 S.Ct.580,

97 L.Ed.821 (1953), a parallel case interpreting a similar

statute?

4. Does the decision of the Eighth Circuit

conflict with the decision of the Fifth Circuit in United

States v. Core Labs Inc.,_759 F.2d 480 (5" Cir. 1985)?

S Does the decision of the Eighth Circuit

holding that the limitations period that begins to run only

after the government concludes its administrative

proceedings effectively eliminates the provisions and

purposes of 28 United States Code §2642?

B. List of all Parties

The petitioner is Richard D. Donohoo.

The federal agency involved is the Federal Deposit

Insurance Corporation.

C. Tables of Contents and Cited Authorities

Table of Contents

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Table of Cited Authorities

Statutes

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die vin.owk su cicduiaicgs acs sha baeanieokeeaeteane 2

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IG EE BOPOD chavs chsdasn baniva dios keeenabUsdes codnchousaduncs 4

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Cases

3M Company v. Browner, 17 F.3d 1453,

305 U.S.App.D.C. 100, (1993)... 0.0... 6

Lindquist & Vennum v. Federal Deposit Insurance

Corporation, 103 F.3d 1409 (8th Cir. 1997)........ 4

Unexcelled Chemical Corp v. United States,

345 U.S. 59, 73 S.Ct.580, 97 L.Ed.821 (1953)...i, 5

United States v. Core Labs inc., 759 F.2d 480

NN PE Sancti ie ncibadesunsocns i, 7, 8,9

United States v. Meyer, 808 F.2d 912

RE ee nee aria leer 9

Rules

United States Supreme Court Rule 13...........00.00000...... 1

D. Citation of the Opinion

United States of America v. Godbout-Bandal, 232 F.3d 637,

(8" Cir. 2000), a copy of which is incorporated in the

Appendix.

E. Basis for Jurisdiction

In November 1998, the United States on behalf of

the Federal Deposit Insurance Corporation (“FDIC”)

commenced an action in the District Court of Minnesota to

enforce civil money penalties against Richard Donohoo and

others arising out of a Order of the FDIC Board of

Governors and subsequently affirmed by the Eighth Circuit

Court of Appeals. The District Court ordered judgment in

favor of the United States.

That decision was appealed by Donohoo to the

Eighth Circuit Court of Appeals. Its Opinion affirming the

District Court was filed on November 15, 2000. A Petition

for Rehearing by Panel and Petition for Rehearing En Banc

was timely filed on December 28, 2000. The Order

Denying Petition for Rehearing by Panel and Petition for

Rehearing En Banc was dated January 29, 2001.

This Petition is filed within 90 days after entry of

the Order denying Petition for Rehearing by Panel and for

Rehearing En Banc as required by Rule 13 of the United

States Supreme Court Rules.

The statutory provision conferring on the Court

jurisdiction to review by a writ of certiorari the opinion of

]

the Eighth Circuit and resulting judgment is 28 U.S.C.

§1254, which provides:

Cases in the courts of appeal may be reviewed by

the Supreme Court by the following methods:

(1) By writ of certiorari granted upon the

petition of any party to any civil or

criminal case, before or after

rendition of judgment or decree; _ .

F. Statutes Involved

The statutes include the following:

28 U.S.C. § 2462, which provides:

Except as otherwise provided by Act of Congress,

an action, suit or proceeding for the enforcement of any

civil fine, penalty, or forfeiture, pecuniary or otherwise,

shall not be entertained unless commenced within five

years from the date when the claim first accrued if, within

the same period, the offender or the property is found

within the United States in order that proper service may be

made thereon.

G. Statement of the Case

The facts are not in dispute and are based on the

chronology of the events in this matter. The basic dispute

2

wy

concerns whether Defendant and other investors were

required to file under the Change in Bank Control Act of

1978 (12 U.S.C. § 1817 (j)) when they inserted $1,000,000

in cash in Capital Bank, a federally insured financial

institution, in July 1990, a time in which the banks in the

United States were in a banking crisis. The cash was

inserted as capital to meet the capital requirements imposed

by the FDIC and without question this capital insertion

enabled Capital Bank to survive even to this day without

expense to the taxpayers. The FDIC’s position was that

filing was required. The history of the FDIC enforcement

efforts is as follows:

July 1990 Insertion of $1,000,000 as capital in

Capital Bank by Donohoo and others

with knowledge of the FDIC

August 1992 Donohoo and other shareholders

contract for sale of their stock in

Capital Bank

September 1992 Assessment of civil money penalties

by FDIC; Donohoo and others

request an administrative hearing

December 1992 Donohoo and the other investors sell

their interest in Capital Bank

April, May 1993 Administrative hearing

September 1994 Administrative Law Judge issues a

Recommended Decision

July 1995 FDIC Board of Governors issues

Decision and Order modifying

3

Recommended Decision and

ordering Donohoo to pay $1,000,554

September 1995 Donohoo and others appeals to Court

of Appeals for the Eighth Circuit

without posting bond or seeking stay

of Decision and Order except for one

defendant who does post bond

January 8, 1997 Court of Appeals issues decision,

Lindquist & Vennum v. Federal

Deposit Insurance Corporation, 103

F.3d 1409 (8th Cir. 1997)

November 1998 FDIC commences this action to

recover civil money penalties

For the purposes of this action, Donohoo is not

denying that the violations occurred or that the penalties

were assessed, but denies that he owes any money on the

grounds that the statute of limitations has run.

The basis for federal jurisdiction in the District

Court of Minnesota is 12 U.S.C. §§ 1817G)(16) (E) and

1818(i) and 28 U.S.C. §§ 1345 and 1355.

H. Argument

By holding that the statute of limitations under 28

United States Code §2642 does not start running until the

administrative process results in a final determination, the

decision of the Eighth Circuit conflicts with the holdings of

4

the United States Supreme Court, a well reasoned decision

of the Fifth Circuit, and the plain meaning of the statute.

The United States Supreme Court case interpreting

a similar statute is Unexcelled Chemical Corp. v. United

States, 345 U.S. 59, 73 S. Ct. 580, 97 L. Ed. 821, (1953).

In that case, the statute was the Portal-to-Portal Act of

1947, 61 Stat. 84,87, 29 U.S.C. § 255, which provided in

Section 6 a two-year statute of limitations for any action to

enforce any cause of action under the Fair Labor Standards

Act of 1938; that section also provides that “every such

action shall be forever barred unless commenced within

two years after the cause of action accrued.” At 345 U.S.

61. In that case, an action to recover from a contractor

liquidated damages was commenced within two years from

the time when a formal complaint in administrative

proceedings was issued, but more than two years from the

time when the contractor violated the act. Judge Douglas

wrote the unanimous opinion that the cause of action

accrued when the violation occurred and stated: “It was

from that date that the period of limitations began to run.”

At 345 U.S. 66.

Judge Douglas then stated:

This construction, it is said, will prejudice

the power of the United States to safeguard the

public interest. But if there is prejudice it is the

result of the Portal-to-Portal Act which Congress,

having made, can refashion.

The instant case is similar. The FDIC cannot

complain about the consequences of the statute of

limitations and cannot seek to avoid it against Donohoo.

Its complaints about the hardships of the statute should be

addressed to the Congress, not to this court. After all, the

5

FDIC had considerable input to Congress when the banking

laws in the late 1980’s and early 1990’s were dramatically

revised and extended during the banking crisis. At that

time, the duties and responsibilities of bankers and the

corresponding penalties were considerably broaden and

increased. Congress could have provided for a different

period of limitations for the FDIC but it did not do so.

Thus, the FDIC was subject to 28 U.S.C. § 2462.

An early decision of the United States Supreme

Court supports the clear language of 28 United States Code

§2642. As stated with approval in 3M Company v.

Browner, 17 F.3d 1453 at 1457, 305 U.S.App.D.C. 100 at

104, (1993):

“In a country where not even treason can be

prosecuted, after a lapse of three years, it could

scarcely be -supposed, that an individual would

remain for ever liable to a pecuniary forfeiture.”

Adams v. Woods, 6 U.S. (2 Cranch) 336, 341, 2

L.Ed. 297 (1805) (Marshall, C.J.). Justice Story,

sitting as a circuit justice in a civil penalty case,

made the same point as Chief Justice Marshall: “it

would be utterly repugnant to the genius of our

laws, to allow such prosecutions a perpetuity of

Certainly the holding of the Eighth Circuit allows

prosecutions by the FDIC a “perpetuity of existence”. The

capital was contributed to the bank in July 1990 with the

knowledge of the FDIC. It did not commence its

enforcement proceeding until September 1992 after

Donohoo and others had executed contracts for the sale of

Capital Bank. Over two years had elapsed. In that period

of time, the FDIC claimed that it was entitled to a

6

Sonera nee ome,

maximum daily penalty of $1,000,000 for each alleged

violation. The total amount sought against Donohoo was

over two billion dollars. If the FDIC has waited for two

more years, as it claims that it has the right and power to

do, the amount would exceed four billion dollars.

Obviously, if the FDIC’s position is that the time

limitations start after the decision of the final reviewing

court, the longer it waits, the higher the penalty. There

would be no limits and it would render any statute of

limitations virtually meaningless.

The Eighth Circuit’s decision is in direct conflict

with the decision of the Fifth Circuit, United States of

America v. Core Laboratories, Inc., 759 F.2d 480, (Fifth

Circuit 1985), which had the same issue: “The issue for

decision is when a particular statute of limitations begins to

tun, that of 28 U.S.C. § 2462.” Id. at 481. After citing the

statute, the Core court stated: The issue for decision is the

meaning of ‘the date when the claim first accrued.’ ” Jd. at

481. The Core court stated:

Under that section, the time is reckoned from the

commission of the act giving rise to the liability, and not

from the time of imposition of the penalty, and it is

applicable to administrative as well as judicial proceedings.

Id. at 482.

After citing the Senate Report and the House

Report, it stated at 482, 483:

It is thus abundantly clear that both the courts and

Congress have construed the “first accrual”

language of § 2462 to mean the date of the

violation.

Va

Practical considerations support this

construction. The progress of administrative

proceedings is largely within the control of the

Government. Northern Metal Co. v. United States,

350 F.2d 833, 839 (3d Cir. 1965). The government

is exempt from the consequences of its laches (quod

nullum tempus occurrit regi). Guaranty Trust Co.

v. United States, 304 U.S. 126, 132, 58 S.Ct. 785,

788, 82 L.Ed. 1224 (1938); United States v. Hughes

House Nursing Home, Inc., 710 F.2d 891, 895 (1*

Cir. 1983) (private defendant cannot assert laches

against government). A limitations period that

began to run only after the government concluded

its administrative proceedings would thus amount in

practice to little or none. As one court has

explained,

If the penalty does not accrue [under § 2462]

until the United States makes an administrative

determination that it is due, the United States has

within its power to prolong the period of limitations

and the producer of rice “would remain indefinitely

under the hazard of having penalties imposed upon

him . . .” United States v. Lynn, supra, 132 F.

Supp. [605] at 607. The Court is of the view that

such is not the case.

Appling, 239 F. Supp. at 194.

We take the same view. The interpretation

of § 2462 advanced by the government is in

derogation of the right to be free of stale claims,

which comes in time to prevail over the right to

prosecute them.

The Eighth Circuit has disagreed with the holding

of Core by relying on United States v. Meyer, 808 F.2d 912

(First Cir. 1987). The argument made in Meyer of the

difficulty of adhering to the statute of limitations by an

agency should be made to Congress. As is readily apparent

from an examination of Title 12 of the United States Code

and as a result of the then existing banking crisis, the

banking laws were substantially amended in the late 1980’s

and early 1990’s to impose greater control over the nation’s

banks and substantially increase the penalties and

enforcement tools available to the FDIC. The FDIC could

have requested Congress and Congress could have adopted

a different statute of limitations so that 28 U.S.C. § 2462

would be inapplicable. [That section commences with the

phrase: “Except as otherwise provided by Act of

Congress.”] In fact, Core was decided in 1985. Both the

FDIC and Congress have had plenty of time to reverse that

decision by adopting a different statute of limitations for

the banking laws or amending 28 U.S.C. § 2462. But such

was not done and the FDIC must follow the law. The five

years has elapsed.

The Eighth Circuit also noted that the Fifth Circuit’s

interpretation could encourage violator abuses of the

administrative system. However, as Core pointed out, the

“progress of administrative proceedings is largely within

the control of the Government.” Jd. at 482.

The FDIC certainly controlled the progress in this

case. Over two years elapsed before the FDIC commenced

its case. The hearing was six months later. From that point

forward, the time is that utilized by the Administrative Law

Judge and the FDIC Board of Governors.

The Eighth Circuit has dismantled the meaning of

28 United States Code §2642 by holding “that where an

Act which authorizes the assessment of a civil penalty also

provides for an administrative procedure for assessing that

penalty, the statute of limitations period set out in § 2462

will not begin to run until that administrative process has

resulted in a final determination.” 28 U.S.C. § 2462 does

not contain that exception or modification. Thus, the

Eighth Circuit has simply created new law. This is not its

province; it is the province of Congress.

Furthermore, 28 U.S.C. § 2462 does not state that

the five years commences from the date of the decision of

the final reviewing court. It does not state that the

limitation period for enforcement of any civil fine

commences after determination of the civil fine by the

agency, such as the FDIC Board of Governors. (The statute

does not apply to equitable remedies.) What it states in

plain and convincing language is that enforcement of a civil

penalty must be commenced within five years from the date

when the claim first accrued.

The statute is clear. The enforcement of a civil fine,

such as in the instant case, must be commenced within 5

years from the date when the claim first accrued.

Certainly, the rationale for the statute makes sense.

The Congress has determined that federal agencies, such as

the FDIC, should not be able to keep people at bay for

years and years. The FDIC has control of the situation. It

determines if and when to assess penalties and the

administrative process.

In the instant case, the claim first accrued in July

1990 when the capital was inserted. The FDIC had

10

knowledge at that time as to the insertion of capital. In any

event, it is rather obvious that the claim of the FDIC

accrued no later that September 1992 when the FDIC first

assessed civil money penalties. Thus, the five-year

limitation expired no later than September 1997. The

government did not commence its enforcement of the civil

fine until November 1998 and thus its enforcement action

is simply too late.

Conclusion

Our country was founded on the principle that we

are a “government of laws.” This decision by the Eighth

Circuit abuses that principle and substitutes the idea that we

are a “government of governments.”

Against alleged banking violators, the laws are

interpreted technically, narrowly and precisely. The FDIC

imposes daily fines up to $1,000,000 calculated from the

date of the alleged violation to the date of the assessment

by the FDIC. Indeed, the longer the period the FDIC waits

for assessing the fines, the higher the amount of the fines.

Good faith and intent are not at issue when assessing the

fines.

But when it comes to laws that are not favorable to

the FDIC, the laws are to be interpreted widely and loosely

and subject to exceptions not contained in the law.

The decision of the Eighth Circuit should be

reversed.

11

Respectfully submitted,

Richard D. Donohoo

2116 Second Avenue South

Minneapolis, Minnesota 55404

(612) 874-7071

12

INDEX TO APPENDIX

Opinion of Eighth Circuit Court of Appeals................ 1

Order of Eighth Circuit Court of Appeals Denying

Petition for Rehearing by Panel and Petition

for Rehearing Ea Bane.....................c0-c0eseeee 8

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

No. 00-1601

United States of America, *

Plaintiff-Appellee, * Appeal from the United

v. ° States District Court for

Cheryl C. Godbout-Bandal; * the District of

Bruce A. Rasmussen; Wayne * Minnesota

Field; ad

Defendants, a [Published]

Richard D. Donohoo, .

Defendant-Appellant. *

Submitted: October 20, 2000

Filed: November 15, 2000

Before HANSEN, MURPHY, and BYE, Circuit Judges.

BYE, Circuit Judge.

A-1

The district court' granted summary judgment to the

federal government on its claim for enforcement of an award

of civil penalties against defendants for violation of the

Change in Bank Control Act, 12 US.C. § 1817().

Defendant Richard D. Donohoo (Donohoo) appeals on the

single issue of whether the applicable five-year statute of

limitations bars the government’s claim. We affirm.

L.

In July, 1990, Donohoo and the other defendants,

officers of Capital Bank, inserted $1,000,000 in cash into

that institution during the banking crisis, in order to meet the

bank’s capital requirements. The investment allowed Capital

Bank to weather the crisis; but, as it turned out, Donohoo and

his cohorts violated the Change in Bank Control Act when

they made their investment without first obtaining approval

from the Federal Deposit Insurance Corporation (FDIC).

See Lindquist & Vennum ederal Deposit Ins. Corp., 103

F.3d 1409, 1413-14 (8™ Cir. 1997).

The exact details of Donohoo’s transgressions are

unimportant for purposes of this appeal; however, the

following chronology is relevant. In September 1992, the

' The Honorable Richard H. Kyle, United State District Judge for the

District of Minnesota.

A-2

FDIC assessed civil penalties against Donohoo in the amount

of $1,000,554.00 for his July, 1990, violation. Donohoo

appealed the assessment, and an administrative hearing was

held before an administrative law judge (ALJ) in April-May,

1993. In September, 1994, the ALJ issued his

Recommended Decision. The FDIC Board of Governors

modified the ALJ’s decision, and in September, 1995, issued

its own decision ordering Donohoo to pay $1,000,554.00.

Donohoo appealed the administrative decision to this court;

we affirmed the penalty assessment on January 8, 1997. See

id. Donohoo then sought a writ of certiorari from the

Supreme Court, which was denied on October 6, 1997. See

Donohoo v. Federal Deposit Ins. Corp., 522 U.S. 821 (1997).

In November, 1998, more than eight years after the

commission of the act for which the penalty was assessed,

the FDIC commenced this action to enforce the penalty

pursuant to 12 U.S.C. § 1818(i). The district court granted

the government’s motion for summary judgment on

December 20, 1999, rejecting without discussion Donohoo’s

argument that the government could not collect on the debt

because the statute of limitations set forth in 28 U.S.C. §

2462 had run.

Il.

Donohoo seeks review of only one issue: whether the

district court erred in implicitly finding that the

government’s claim against him is not barred by the statute

of limitations. We review the district court’s grant of

summary judgment de novo. See Lynn v. Deaconess Med.

Ctr.-West Campus, 160 F.3d 484, 486 (8" Cir. 1998).

The government proceeds against Donohoo pursuant

to § 1818(1)(1) which allows the “appropriate Federal

banking agency” to seek “enforcement of any effective and

outstanding notice or order issued under this section” in

district court. This statutory provision is not equipped with

its own statute of limitations; thus, the general statute of -

limitations for collection of civil penalties, 28 U.S.C. § 2462,

applies. Section 2462 states as follows:

Except as otherwise provided by Act of Congress, an

action, suit or proceeding for the enforcement of any

civil fine, penalty, or forfeiture, pecuniary or

otherwise, shall not be entertained unless commenced

within five years from the date when the claim first

accrued if, within the same period, the offender or the

property is found within the United States in order

that proper service may be made thereon.

28 U.S.C. § 2462.

A-4

Donohoo argues that the government’s claim’ for

enforcement of the penalties assessed against him by the

FDIC is barred by this statute. He asks us to interpret the

phrase “claim first accrued” to mean the date of the original

violation for which the penalty was assessed, i.e., July, 1990.

The government, in contrast, argues that the claim does not

accrue until the administrative proceedings assessing the

penalties are completed.

This question appears to be a matter of first

impression in our circuit. The circuits are spli: on when a

claim accrues under this statute of limitations. The Fifth

Circuit favors Donohoo’s approach. See United States v.

Core Labs, Inc., 759F.2d 480 (5" Cir. 1985). The Core court

analyzed caselaw arising under the various predecessors to §

2462 and found that “[a] review of these cases clearly

demonstrates that the date of the underlying violation has

been accepted without question as the date when the claim

first accrued, and, therefore, as the date on which the statute

began to run.” Id. at 482. The court also found support for

its position in the legislative history of the Export

Administration Act, 50 U.S.C. App. § 2401, the Act pursuant

to which the underlying lawsuit was brought. See id.

Finally, the court noted that “[p]ractical considerations

A-5

support this construction. The progress of administrative

proceedings is largely within the control of the Government.

A limitations period that began to run only after the

government concluded its administrative proceedings would

thus amount in practice to little or none.” Id. at 482-83.

The First Circuit takes the opposite position. See

United States v. Meyers, 808 F.2d 912 (1* Cir. 1987). In

Meyers, another proceeding under the Export Administration

Act, the First Circuit rejected Core’s reasoning (“the core of

Core” id. at 913). Instead, the court held that where the Act

which authorizes the assessment of a penalty provides for an

administrative procedure for assessing that penalty, the

statute of limitations at § 2462 does not begin to run until

“the penalty has first been assessed administratively.” Id. at

914. The Meyers court noted the “obvious proposition that a

claim for ‘enforcement’ of an administrative penalty cannot

possibly ‘accrue’ until there is a penalty to be enforced.” Id.

Because the court found the language of the relevant statutes

to be unambiguous, it rejected any resort to statutory

construction to aid in interpretation. Id. at 915. Further, the

court noted that rather than preventing government abuses,

the Fifth Cuircuit’s interpretation could encourage violator

abuses of the administrative system. If the government has

A-6

only five years from the date of the violation to assess a

penalty and begin collection proceedings, the violator would

have great incentive to delay the process as much as

possible, hoping that the government’s clock would run out

before the enforcement proceedings began. See id. at 919.

The court additionally noted that,

[oJutside of the Fifth Circuit, no court has ever held

that, in a case where an antecedent administrative

judgment is a_ statutory prerequisite to the

maintenance of a civil enforcement action, the

limitations period on a recovery suit runs from the

date of the underlying violation as opposed to the

date on which the penalty was administratively

imposed.

Id. at 916.

The parties direct us to only one case that has

examined the question of when a claim accrues under §

1818. In that case, the court followed the First Circuit’s lead

and held that “[t]he government could not bring an action in

this court to enforce the penalty until the final decision was

issued, ...and the assessment was not further appealed.”

United States v. McIntyre, 779 F. Supp. 119, 122 (S.D. Iowa

1991).

? One other court has considered this question, ironically, in reference to

Donohoo himself. During the course of the enforcement proceedings,

Donohoo filed for bankruptcy in Florida, pursuant to Chapter 13 of the

A-7

The issue has significant consequences. In this case,

under the Fifth Circuit’s reasonings, the government would

have had to commence its collection proceedings by July,

1995; thus, it would now be time-barred from attempting to

enforce the penalty against Donohoo. Under the First

Circuit’s reasoning, however, the action instituted by the

government in 1998 would be timely.

We find the First Circuit’s reasoning to be more

persuasive. We therefore hold that where an Act which

authorizes the assessment of a civil penalty also provides for

an administrative procedure for assessing that penalty, the

statute of limitations period set out in § 2462 will not begin

to run until that administrative process has resulted in a final

determination.’

Bankruptcy Code. The government protested that the assessment of its

fine against Donohoo raised Donohoo’s debt beyond the cap for

eligibility under Chapter 13. Donohoo countered by alleging that the

government could not collect the penalty, because of the running of the

statute of limitations period. The United States Bankruptcy Court for the

Middle District of Florida, following the First Circuit’s interpretation,

held that “the assessment did not become final until the Supreme Court

denied the Debtor’s petition for certiorari on October 6, 1997.” In Re

Donohoo, 243, B.R. 139, 142 (Bankr. M.D. Fla. 1999).

> We need not decide whether an appeal of an administrative decision tot

the federal courts would be considered part of the administrative penalty-

assessment process, for purposes of determining when the limitations

period begins to run. Both the date that the final administrative order

A-8

Our conviction that this is the correct rule is

reinforced by our observation that § 1818(i) does not allow

the government to begin a collection proceeding until the

defendant “fails to pay an assessment after any penalty

imposed under this paragraph had become final.” 12 U.S.C. |

§ 18180)(2)DG). In other words, the government is

precluded from bringing an enforcement action until the

penalty has been ffinalized through administrative

proceedings. Under the Fifth Circuit’s rule, the government

could find itself unable to collect on a penalty simply

because those proceedings have taken too long. A violator

should not be able to escape paying a penalty by dragging his

feet through the administrative penalty-assessment process.

Thus, we hold that the government’s enforcement action is

timely.

Affirmed.

A true copy.

Attest:

CLERK, U.S. COURT OF APPEALS,

EIGHTH CIRCUIT

was entered, and the date the Supreme Court denied review are within

five years of the date the government initiated this suit.

A-9

UNITED STATE COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

No. 00-1601

United States of America, *

Appellee, ° Order Denying Petition

v. ” for Rehearing and for

Richard D. Donohoo, . Rehearing En Banc

Appellant.

The petition for rehearing en band is denied. The

petition for rehearing by the panel is also denied.

Judge Loken did not participate in this decision.

(5128-010199)

January 29, 2001

Order Entered at the Direction of the Court:

/s/

Clerk, U.S. Court of Appeals, Eighth Circuit

A-10