Page:United States Reports 502 OCT. TERM 1991.pdf/192

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BOARD OF GOVERNORS, FRS v. MCORP FINANCIAL, INC. Opinion of the Court

Hawke, Jr., Jerome I. Chapman, Howard N. Cayne, and David F. Freeman, Jr. Justice Stevens delivered the opinion of the Court. MCorp, a bank holding company, filed voluntary bankruptcy petitions in March 1989. It then initiated an adversary proceeding against the Board of Governors of the Federal Reserve System (Board) seeking to enjoin the prosecution of two administrative proceedings, one charging MCorp with a violation of the Board’s “source of strength” regulation 1 and the other alleging a violation of § 23A of the Federal Reserve Act, as added, 48 Stat. 183, and amended.2 The District Court enjoined both proceedings, and the Board appealed. The Court of Appeals held that the District Court had no jurisdiction to enjoin the § 23A proceeding, but that, under the doctrine set forth in Leedom v. Kyne, 358 U. S. 184 (1958), the District Court had jurisdiction to review the validity of the “source of strength” regulation. The Court of Appeals then ruled that the Board had exceeded its statutory authority in promulgating that regulation. 900 F. 2d 852 (CA5 1990). We granted certiorari, 499 U. S. 904 (1991), to review the entire action but, because we conclude that the District Court lacked jurisdiction to enjoin either regulatory proceeding, we do not reach the merits of MCorp’s challenge to the regulation. I In 1984, the Board promulgated a regulation requiring every bank holding company to “serve as a source of financial 1

The “source of strength” regulation provides in relevant part: “A bank holding company shall serve as a source of financial and managerial strength to its subsidiary banks and shall not con[d]uct its operations in an unsafe or unsound manner.” 12 CFR § 225.4(a)(1) (1991). 2 Section 23A sets forth restrictions on bank holding companies’ corporate practices, including restrictions on transactions between subsidiary banks and nonbank affiliates. See 12 U. S. C. § 371c.