IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

DORAL BANK,

Plaintiffs,

v.

FEDERAL DEPOSIT INSURANCE
CORPORATION, TRIBUNAL de PRIMERA
INSTANCIA, SALA de FAJ ARDO,
ENVIRONMENTAL QUALITY BOARD OF
THE COMMONWEALTH OF PUERTO RICO
and SOCIAL INTEREST GROWTH
ASSOCIATES CORPORATION,

Defendants.

CIVIL NO.:



RE: DECLARATORY J UDGMENT AND
INJ UNCTIVE RELIEF




COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF

COMES NOW, Plaintiff, DORAL BANK (hereinafter "DORAL"), by and
through its undersigned counsel to file this, its Complaint for Declaratory J udgment and
Injunctive Relief against Defendants, FEDERAL DEPOSIT INSURANCE
CORPORATION (hereinafter FDIC), TRIBUNAL de PRIMERA INSTANCIA, SALA
de FAJ ARDO (hereinafter COURT OF FIRST INSTANCE), ENVIRONMENTAL
QUALITY BOARD OF THE COMMONWEALTH OF PUERTO RICO (hereinafter
EQB) and SOCIAL INTEREST GROWTH ASSOCIATES CORPORATION
(hereinafter SIGA), and alleges as follows:
PARTIES
1. DORAL is a federally insured banking institution duly organized and
authorized to do business in the Commonwealth of Puerto Rico. DORALs principal
place of business is in San J uan, Puerto Rico.
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2. The FDIC is an independent agency of the United States created by the
Federal Deposit Insurance Act (hereinafter FDIC ACT), 12 U.S.C. 1811 et seq., and
related laws and regulations. The FDIC insures the deposits of all banking and savings
associations which are entitled to the benefits of insurance under Chapter 16 of Title 12
of the United States Code. The FDIC insures the deposits of DORAL.
3. The COURT OF FIRST INSTANCE is the lower level court within the
J udicial Branch of the Commonwealth of Puerto Rico, created by Act No. 201 of August
22, 2003, as amended, which is composed of two hundred and fifty three (253) superior
judges and eighty five (85) municipal judges with courthouses located in various regions
within the Commonwealth of Puerto Rico, including in the Municipality of Fajardo. The
Honorable Isabel Lpez, Superior J udge, in the Court of First Instance of Fajardo, issued
an order, without jurisdiction and in violation of 12 U.S.C.A. 1818(i), which affects the
enforcement of a prior FDIC Consent Order which is at issue in this action.
4. The EQB is an agency of the government of the Commonwealth of Puerto
Rico. It is charged with the obligation and authority to protect and conserve the
environment of Puerto Rico. The EQB has petitioned the COURT OF FIRST
INSTANCE to sanction DORAL for its failure to comply with the order of J udge Lpez
which compels DORAL to violate the terms of the prior FDIC Consent Order which is at
issue in this action.
5. SIGA is a corporation duly organized and authorized to conduct business
under the laws of the Commonwealth of Puerto Rico. SIGAs principal place of business
is San J uan, Puerto Rico. SIGA is the owner of real property on which an abandoned
wastewater treatment facility, serving only adjacent land owners, is located. DORAL is
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the owner and holder of a mortgage on the real property. SIGA contends that it is the
responsibility of DORAL, as mortgagee, to rehabilitate and operate the wastewater
treatment facility owned by SIGA for the benefit of SIGA. The COURT OF FIRST
INSTANCE has entered a permanent mandatory injunction compelling DORAL to do so.
JURISDICTION AND VENUE
6. J urisdiction is proper in this Court pursuant to 12 U.S.C. 1819 (b)(2),
1331 and 28 U.S.C. 1345 because this action arises under the FDIC Act 12 U.S.C.
1811, et seq. In addition, pursuant to 12 U.S.C. 1819(b)(2), with certain exceptions not
applicable to the instant case, all civil lawsuits in which the FDIC, in any capacity, is a
party are deemed to arise under the laws of the United States.
7. Venue is proper in this Court pursuant to 28 U.S.C. 1391(e) because a
substantial part of the events, acts or omissions giving rise to the need for a declaration of
rights and permanent injunction occurred in this District and a defendant is an agency of
the United States.
STATEMENT OF CLAIM FOR DECLARATORY RELIEF
8. This is an action brought by DORAL for declaratory relief pursuant to 28
U.S.C.A. 2201 to declare the rights, obligations, status and legal relations of DORAL,
the FDIC, the COURT OF FIRST INSTANCE, the EQB and SIGA under an FDIC
Consent Order; the J udgment of the COURT OF FIRST INSTANCE; Law No. 9 of J une
18, 1970, as amended in 2004; and, the mortgage provided to DORAL by SIGA.
9. In 2005, Doral granted certain credit facilities to SIGA collateralized by,
among other things, mortgages on certain real estate owned by SIGA. SIGA defaulted
under its obligations under the credit facilities and DORAL filed suit for collection of the
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monies owed and to foreclose on the mortgages that served as collateral in Civil Case No.
NCSI2008-00976, Commonwealth of Puerto Ricos Court of First Instance, Fajardo Part.
DORAL obtained a J udgment in its favor against SIGA. One of the mortgages which
served as collateral for the credit facilities is located on real estate where SIGA operated
a wastewater treatment plant (hereinafter PROPERTY). The PROPERTY was
undeveloped except for the wastewater treatment plant, which SIGA had previously
constructed to service homes located on an adjacent property. A true and correct copy of
DORALS mortgage on the PROPERTY is attached hereto and fully incorporated herein
as DORALS Exhibit A.
10. DORAL did not foreclose its mortgage on the PROPERTY and SIGA has
failed to pay DORAL the monies owed pursuant to the local courts J udgment.
11. As a result of the default, the SIGA loan, is more than ninety days delinquent
and is uncollected.
12. Upon or immediately after SIGAs default, SIGA abandoned the
PROPERTY and failed to maintain or continue operation of the wastewater treatment
plant. The unattended plant began to release untreated sewage water onto the
PROPERTY which then flowed onto adjacent land, where SIGA had previously
developed a housing project whose units were sold to third parties.
13. In February 2011, in order to protect and preserve its mortgage interest in
the PROPERTY, DORAL commenced an action in the COURT OF FIRST INSTANCE
to require SIGA to return the wastewater treatment plant to an operational condition and
to halt any further spillage of sewage water or other contaminants onto the PROPERTY
in Civil Case No. NSCI2011-00115, before the Commonwealth of Puerto Ricos Court of
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First Instance, Fajardo Part. A true and correct copy of the aforementioned Complaint is
attached hereto and is fully incorporated herein as DORALs Exhibit B.
14. As a result of DORALs action to compel SIGA to remedy the
environmental damage being caused by the abandoned wastewater treatment plant, the
COURT OF FIRST INSTANCE entered a J udgment on April 19, 2012, ordering SIGA to
rehabilitate and commence operation of the wastewater treatment plant.
15. However, the courts J udgment also contained an alternate provision to the
effect that if SIGA failed to comply, the court could order DORAL to advance funds to
satisfy SIGAs financial responsibility to repair and operate the plant. The courts order
provided that the advancing of such funds would be considered an additional
indebtedness from SIGA to DORAL. A true and correct copy of the aforementioned
J udgment issued by the COURT OF FIRST INSTANCE on April 2012 is attached hereto
and fully incorporated herein as DORALs Exhibit C.
16. On or about August 8, 2012, following DORALs vigorous objections to
FDIC allegations concerning DORALS financial condition, the FDIC issued a Consent
Order more particularly described as: In the Matter of Doral Bank San J uan, Puerto Rico,
(Insured State Non-Member Bank); FDIC 12-134b (hereinafter CONSENT
ORDER)., which, inter alia, required that:
(e) The Bank shall not extend, directly or indirectly, any additional credit to, or
for the benefit of, any borrower whose loan or other credit is more than 90 days
delinquent or has been classified as Substandard, Doubtful, or listed for
Special Mention in the current Report of Examination or any future report of
examination, and is uncollected, unless the Board, or designated committee
thereof, provides, in writing, a detailed explanation of why the extension is in the
best interest of the Bank. Prior to extending additional credit pursuant to this
subparagraph, whether in the form of a renewal, extension, or further advance of
funds, such additional credit shall be approved by the Board, who shall determine
that:
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(i) the failure of the Bank to extend such credit would be detrimental to the
best interests of the Bank, with a written explanation of why the failure to extend
such credit would be detrimental;

(ii) the extension of such credit would improve the Banks position, with a
written explanatory statement of how and why the Banks position would
improve; and

(iii) an appropriate workout plan has been developed and will be
implemented in conjunction with the additional credit to be extended.

A true and correct copy of the CONSENT ORDER is attached hereto and is fully
incorporated herein as DORALs Exhibit D.
17. The CONSENT ORDER prohibited DORAL from directly or
indirectly extending any further credit to or for the benefit of SIGA.
18. Soon after the entry of the J udgment of the COURT OF FIRST
INSTANCE, SIGA claimed to be without funds to place the wastewater treatment plant
back into service for operation. Instead, SIGA urged and the court ordered DORAL to
employ a receiver, rehabilitate and operate the plant for SIGAs benefit for an indefinite
amount of time. A true and correct copy of the courts Order of December 2012 requiring
DORAL to assume the financial responsibility to repair and operate SIGAs wastewater
treatment plant is attached hereto and fully incorporated herein as DORALs Exhibit E.
19. Due to SIGAs neglect and abandonment of its wastewater treatment
plant, the facility has fallen into such a state of disrepair that hundreds of thousands or
millions of dollars will now be required to restore the plant to a fully functional condition
and, thereafter, operate the plant in compliance with the applicable Puerto Rico
environmental regulations.
20. DORAL objected but was unsuccessful in its efforts to obtain relief from
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the J udgment and subsequent Order of the COURT OF FIRST INSTANCE imposing the
substantial financial burden of the repair and indefinite operation of the wastewater plant
for the benefit of SIGA.
21. In March, 2014, the EQB sought to intervene in the action pending before
the COURT OF FIRST INSTANCE for the purpose of obtaining court sanctions against
DORAL for DORALs failure to assume financial responsibility for the operation of the
wastewater treatment plant.
22. The EQB undertook its actions in a wrongful attempt to avoid and place
upon DORAL the EQBs obligations under Law No. 9 of J une 18, 1970, as amended in
2004, to collect and properly dispose of the waste from the adjacent landowners which
was being directed to the non-operational wastewater treatment plant located on the
PROPERTY.
23. At the EQBs request, in May 2014, the COURT OF FIRST INSTANCE
entered an order that DORAL would be subject to a daily penalty of $1,000.00, for each
day DORAL was found to be in noncompliance of the order to assume the financial
obligation to rebuild and operate SIGAs wastewater treatment plant.
24. As a result of the foregoing, an immediate, real, substantial and continuing
controversy of a justiciable nature exists between DORAL, the FDIC, the COURT OF
FIRST INSTANCE, the EQB and SIGA concerning DORALs ability to advance
substantial funds on behalf of SIGA; the statutory environmental protection duties and
responsibilities of the EQB; and the mortgagor/mortgagee relationship between SIGA
and DORAL.
25. The controversy is of sufficient immediacy and reality to justify the
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issuance of a declaratory judgment.
26. The issuance of declaratory relief by this Court will terminate most or all
of the existing controversy between the parties as it pertains to the CONSENT ORDER;
the J udgment and further orders of the COURT OF FIRST INSTANCE; the statutory
obligations of the EQB to ensure that the waste of the adjacent property owners is
properly processed and not discharged untreated on the PROPERTY and adjacent land;
and, DORALs obligations, if any, as mortgagee.
27. The declaratory relief sought herein will serve an immediate and useful
purpose in settling the legal relations of the parties to this action who have adverse legal
interests.
28. Each Defendant is a party necessary or proper for obtaining complete
adjudication of this controversy concerning the respective rights and duties of the parties
hereto.
29. A practical need exists for resolution of the dispute concerning the status,
rights and obligations of the parties hereto.
30. The declaratory judgment sought herein will afford the parties relief from the
uncertainty, insecurity and controversy giving rise to this proceeding.

PRAYER FOR RELIEF

WHEREFORE, DORAL seeks a Declaratory J udgment and any appropriate
ancillary relief against the FEDERAL DEPOSIT INSURANCE CORPORATION, the
TRIBUNAL de PRIMERA INSTANCIA, SALA de FAJ ARDO, the
ENVIRONMENTAL QUALITY BOARD OF THE COMMONWEALTH OF PUERTO
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RICO and SOCIAL INTEREST GROWTH ASSOCIATES CORPORATION:
a. Declaring and adjudicating the respective rights and obligations, if any,
between DORAL, the FDIC, the COURT OF FIRST INSTANCE, the EQB and SIGA
under the CONSENT ORDER;
b. Declaring and adjudicating the respective rights and obligations, if any,
between DORAL, the FDIC, the COURT OF FIRST INSTANCE, the EQB and SIGA
under the J udgment and further orders of the COURT OF FIRST INSTANCE which
required DORAL to advance funds for the benefit of SIGA;
c. Declaring and adjudicating the respective rights and obligations, if any,
between DORAL, the FDIC, the COURT OF FIRST INSTANCE, the EQB and SIGA
under Law No. 9 of J une 18, 1970, as amended in 2004, for the EQB to undertake the
collection and processing of the waste of the residents living adjacent to the PROPERTY
whose sewage is spilling onto the PROPERTY on account of SIGAs abandonment of its
wastewater treatment plant;
d. Declaring and adjudicating the respective rights and obligations, if any,
between DORAL, the FDIC, the COURT OF FIRST INSTANCE, the EQB and SIGA as
a consequence of the mortgagor/mortgagee relationship between SIGA and DORAL;
and,
e. Awarding DORAL its reasonable attorneys fees, as appropriate, as well
as its taxable costs and such other and further relief as this Court may deem just and
proper.
STATEMENT OF CLAIM FOR PERMANENT INJUNCTION
31. DORAL realleges, reavers and incorporates herein as if fully set forth, its
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prior allegations found and contained in paragraphs one through twenty-three above.
32. DORAL seeks a permanent injunction forever staying the enforcement of
the J udgment and further related orders of the COURT OF FIRST INSTANCE.
33. If permanent injunctive relief is not granted, DORAL will suffer irreparable
injury.
34. If DORAL fails to comply with the Judgment and related further orders of
the COURT OF FIRST INSTANCE, it will suffer steep monetary sanctions and the
possibility of being found in contempt of the court.
35. Alternatively, if DORAL complies with the J udgment and orders of the
COURT OF FIRST INSTANCE, it will be required to pay a continuing civil money
penalty levied by the FDIC for breaching the CONSENT ORDER.
36. The FDIC ACT provides tiered penalties that range from $5,000 up to
$1,000,000.00 per day for each day a bank violates a provision of a Consent Order and,
further the FDIC has authority to revoke a non-compliant banks status as an insured
depository institution. Here, such a penalty would be fatal to DORALs operation as a
financial institution.
37. The FDIC's authority to impose civil monetary penalties on institution-
affiliated parties of up to $1,000,000 per day arises from three statutory provisions.
38. The provisions differentiate the FDIC's ability to impose sanctions based
on the level of culpability properly attributed to the offending party. Unquestionably,
under 12 U.S.C. 1818(i), the FDIC is empowered to impose monetary penalties
generally.
39. Regardless of which course of action it follows, DORAL will either face
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severe monetary penalties and possible contempt of court or fines of a crippling
magnitude and the devastating loss of its status as an insured depository institution.
40. DORAL has been placed between the proverbial rock and a hard place as
no matter which order it complies with, it will necessarily breach the other and be
sanctioned.
41. On the other hand, there would be no harm done if this Court stays the
order of the COURT OF FIRST INSTANCE as the status quo that has been in effect for
at least two years would remain.
42. DORAL does not question that there exists a strong public policy to avoid
environmental hazards and contamination in Puerto Rico; nor does DORAL question the
legitimate interest of the COURT OF FIRST INSTANCE in solving an emergency
situation that is creating an environmental hazard on the PROPERTY.
43. However, DORAL does question the basis cited by the COURT OF FIRST
INSTANCE for identifying DORAL, as a purported deep pocket, and ordering it to take
measures and spend substantial resources in the operation of another partys wastewater
treatment plant simply because it occupies the status of a mortgage holder.
44. There exists a strong public interest in allowing financial institutions to
comply with regulatory requirements and FDIC orders entered to ensure that they adhere
to sound banking practices, avoid violations of the law and maintain adequate asset
quality, capital, earnings and liquidity.
45. Under 12 U.S.C. 1818 (2000), if, in the FDIC's opinion, an insured
depository institution or any of its directors has engaged in unsafe or unsound business
practices or has violated ... a law, rule, or regulation, or any condition imposed ... by the
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[FDIC] ..., the [FDIC] may ... issue and serve upon ... such party a notice of charges ...
constituting the alleged violation. 12 U.S.C. 1818(b)(1).
46. The FDIC is authorized to issue a temporary cease and desist (asset
freeze) order pending completion of the hearing if the alleged violation is likely to
cause insolvency or significant dissipation of assets ... or to weaken the condition of the
... institution or otherwise prejudice the interests of its depositors .... 12 U.S.C.
1818(c)(1).
47. DORAL submits that an advancement of the public interest clearly favors
compliance with the CONSENT ORDER. The publics interest in promoting and
safeguarding sound banking practices is even stronger where, as here, a governmental
agency, the EQB, has been created and expressly provided with the resources to assume
control and operation of neglected and abandoned wastewater treatment facilities such as
that owned by SIGA.
48. It was the EQB who granted the original permit for SIGAs operation of the
wastewater treatment plant and allowed SIGA to continue in possession and control of
the plant while it slowly fell into disrepair in clear violation of the applicable legal and
regulatory requirements.
49. Moreover, the EQB has a statutory mandate to implement Puerto Ricos
environmental public policy. It is the government entity responsible to oversee
compliance with the islands environmental laws and regulations. 12 L.P.R.A. 1120.
Addressing with its resources environmental liabilities such as that created by SIGA is
the very reason for the existence of the EQB.

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PRAYER FOR RELIEF
WHEREFORE, DORAL seeks a permanent injunction ordering the permanent
stay of the J udgment and further related orders of the TRIBUNAL de PRIMERA
INSTANCIA, SALA de FAJ ARDO which affect the enforcement of the CONSENT
ORDER or in any way, directly or indirectly, increase the indebtedness of the SOCIAL
INTEREST GROWTH ASSOCIATES CORPORATION to DORAL BANK.
In San J uan, Puerto Rico this 22
nd
day of J uly, 2014.

GURLEY VITALE
Attorneys for Doral Bank
P.O. Box 8387, San J uan, PR 00910-0387
Phone (941) 365-4501/(787) 522-0525
Fax (941) 365-2916/(787) 522-0524

/s/ Alfredo Fernndez-Martnez
Alfredo Fernndez-Martnez, Of Counsel
USDC Bar. No. 210511
Primary: afernandez@GurleyVitale.com

/s/ David E. Gurley
David E. Gurley
USDC Bar No. 221202
Primary: dgurley@GurleyVitale.com
Secondary: eservice@GurleyVitale.com















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