                             PUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT


                            No. 12-1588


FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver for The
Bank of Asheville,

                Plaintiff - Appellee,

           v.

AVERY T. CASHION, III,

                Defendant - Appellant.



Appeal from the United States District Court for the Western
District of North Carolina, at Asheville. Martin K. Reidinger,
District Judge. (1:11-cv-00072-MR-DLH)


Argued:   March 19, 2013                  Decided:   June 19, 2013


Before MOTZ, KING, and AGEE, Circuit Judges.


Affirmed by published opinion.     Judge Agee wrote the majority
opinion, in which Judge Motz      joined.    Judge King wrote a
dissenting opinion.


ARGUED: Edward Louis Bleynat, Jr., FERIKES & BLEYNAT, PLLC,
Asheville, North Carolina, for Appellant.     Esther Elizabeth
Manheimer, VAN WINKLE, BUCK, WALL, STARNES & DAVIS, PA,
Asheville, North Carolina, for Appellee.    ON BRIEF: Lynn D.
Moffa, VAN WINKLE, BUCK, WALL, STARNES & DAVIS, PA, Asheville,
North Carolina, for Appellee.
AGEE, Circuit Judge:

        Avery T. Cashion, III, appeals from the district court’s

judgment in favor of the Federal Deposit Insurance Corporation

(“FDIC”), acting as receiver for The Bank of Asheville (“the

Bank”), in this action by the FDIC to recover the deficiency

owed on a promissory note executed by Cashion and payable to the

Bank.      Cashion       contends     that       the    district       court    erred   in

granting summary judgment to the FDIC because genuine issues of

material fact exist as to whether the FDIC was the holder of the

note and whether the note had been cancelled or assigned.                               He

also     asserts    the     district    court          abused    its    discretion      in

striking his surreply brief opposing summary judgment and an

affidavit attached to it.             For the reasons set forth below, we

affirm the judgment of the district court.



                                         I.

        In August 2006, Cashion signed a promissory note (“Note”)

payable     to     the    Bank   in    the       original       principal      amount   of

$2,000,000.00.       Through March 2010, the Bank and Cashion entered

into a number of modifications and renewals of the Note.                                The

Note was originally secured by three other promissory notes, and

a fourth promissory note was added as additional collateral in

2010.



                                             2
      In   September     2010,    the    Bank    filed    an   action   in     North

Carolina state court alleging that it was the holder of the

Note, that Cashion had defaulted by failing to make the payments

due on the Note, and that it was entitled to full payment plus

interest    pursuant     to     the   Note’s     terms.        Cashion’s      Answer

admitted “a copy of a document, which speaks for itself, is

attached to [the Bank’s] Complaint,” and that the signature on

that document “appears to be the signature of Mr. Cashion,” but

“demand[ed] that the [Bank] produce the original document that

is described as [the Note].”            (J.A. 17-19.)

      Before the case proceeded further, the Bank closed and the

FDIC was named receiver and liquidating agent.                   After the FDIC

was   substituted   as    the    real    party   in   interest    in    the    state

court, it removed the case to the United States District Court

for the Western District of North Carolina. 1              The FDIC then moved

for summary judgment, asserting that it had set forth a prima

facie case to recover proceeds on the Note and that no genuine

issues of material fact precluded judgment as a matter of law.

It attached to the motion an affidavit from Sherry M. Martin, a

“Resolutions and Receiverships Specialist” for the FDIC who was


      1
       Federal courts have jurisdiction over all civil suits “to
which the [FDIC], in any capacity, is a party,” and the FDIC is
authorized to remove actions pending in state court to “the
appropriate United States district court” if the FDIC is
substituted as a party. 12 U.S.C. § 1819(b)(2)(A)-(B).


                                          3
“familiar with the books and records of” the FDIC and the Bank.

Martin stated in the affidavit that the information alleged in

the Complaint came from records and employees of the Bank, and

was correct and true.      (J.A. 31.)

     Cashion     opposed   the    motion,   asserting   that    two   genuine

issues    of    material   fact   existed:    first,    whether     the   FDIC

satisfied its burden of proving that it was the holder of the

Note in light of its failure to produce the original Note, and

second, whether the Note had been cancelled or assigned.                    To

support   the    latter    argument,    Cashion   included     an   affidavit

asserting the Note had been cancelled and attaching a copy of

the Internal Revenue Service (“IRS”) Form 1099-C that he alleged

he received from the Bank in early 2010 (“the 1099-C Form”) as

the sole basis for his affidavit. 2            The 1099-C Form, labeled

“Cancellation of Debt” in pre-printed text, had been filled out

by hand and lists the Bank of Asheville as the creditor and

Cashion as the debtor, references the Note’s account number,

reflects the “Date canceled” as “6/23/2010” and the “Amount of




     2
       Cashion attached copies of two different Form 1099-Cs he
claimed he received from the Bank, but only one of them lists
the same account number as the Note. While Cashion continues to
refer to both forms on appeal, our analysis considers only the
Form 1099-C bearing the Note’s account number. On its face, the
other form does not appear to relate to the Note, and Cashion
did not introduce any evidence suggesting that it in fact does.


                                       4
debt canceled” as $1,993,222.20.                   The “Debt description” box

states: “Assignment of Promissory Notes.”                 (J.A. 42.)

       The FDIC attached a supplemental affidavit from Martin to

its    response    in   support    of     summary        judgment    in   which    she

reiterated her

       familiar[ity] with the books and records acquired by
       the [FDIC] when it was appointed Receiver for [the
       Bank]. . . . The books and records in question were
       made at or near the time of the matters therein
       recorded and were kept in the course of [the Bank’s]
       regularly conducted business activity, the regular
       practice of which was to keep such books and records.

(J.A. 81.)      Martin’s supplemental affidavit also stated that the

FDIC had possession of the original Note, that the copy attached

to the Complaint was “true and correct,” that the Note had not

been transferred or assigned to a third party, that the Note had

not been paid by Cashion or a third party, and that the Note had

not been cancelled or Cashion “otherwise absolved” of liability.

Martin   also     stated   that   based       on   the   Bank’s     records   in   the

FDIC’s possession, the 1099-C Form “appear[ed] to have been sent

to Mr. Cashion by [the Bank] prior to the” receivership.                          (J.A.

82.)   Martin also indicated that

       [t]he    most   likely   explanation   for   the   debt
       cancellation referred to in hand-writing on the IRS
       1099-C Form . . . is that “Assignment of Promissory
       Notes” refers to the collateral securing the Note . .
       . .   The fact that [the Bank] may have issued an IRS
       1099-C Form concerning the collateral that secured the
       Note   does   not  mean   that  [the  Bank]   cancelled
       [Cashion’s] debt to [the Bank] reflected by the Note.


                                          5
(J.A. 82.)        Based on Martin’s supplemental affidavit, the FDIC

argued that it was the holder of the Note and was not required

to produce the original Note in order to prove that status under

North    Carolina      law     because         a    true    copy       was    sufficient.         In

addition,      the      FDIC       contended            that      the        1099-C     Form     was

inadmissible         hearsay        and    that         Cashion         had     not       “properly

authenticated” the form for admission into evidence under any of

the   exceptions       to    the    rule       against         hearsay.         The     FDIC     also

posited that the 1099-C Form did not refer to the Note, but to

the collateral for the Note.                        Alternatively, the FDIC asserted

that “at most,” the 1099-C Form indicated the Bank’s intent that

the Note be cancelled, but was not competent evidence of actual

cancellation.

        Cashion    did      not     move       to       strike     Martin’s           supplemental

affidavit, but instead filed an additional notice of filing in

opposition        to     summary          judgment            (hereinafter            “surreply”)

countering the FDIC’s arguments regarding the admissibility and

import of the 1099-C Form.                 Cashion attached to the surreply an

affidavit     from     his     business            partner,      Raymond       M.     Chapman,    in

which    Chapman       described         the       1099-C       Form    and     then      gave   his

viewpoint as to what Cashion’s receipt of the 1099-C Form from

the Bank likely meant (cancellation of the Note).

        The   FDIC     moved        to     strike          the     surreply         and     Chapman

affidavit,     noting        that    “[n]othing            in    the     [c]ourt’s         Pretrial

                                                    6
Order      and    Case     Management   Plan     authorize[d]      the     filing    of   a

surreply,”        and      Cashion    had   not    sought     leave      of    court      to

authorize such a filing.              (J.A. 127.)      It further asserted that

a surreply was not appropriate under the circumstances given

that its reply had not raised any new issues.                       In addition, the

FDIC       argued     that    the     Chapman     affidavit     contained        opinion

testimony from a person who was not an expert witness rather

than information based on Chapman’s personal knowledge.                                For

that reason, the FDIC urged the district court to strike or

disregard the affidavit. 3

        For reasons summarized in context below, the district court

granted the FDIC’s motion to strike the surreply and Chapman

affidavit,        denied     Cashion’s      motion   for    leave     to      file   those

items,      and     then    awarded   summary     judgment    to    the    FDIC.       The

district court entered final judgment in favor of the FDIC in

the amount of “$2,111,427.12, together with interest at the rate

of $373.73 per day from and after September 2, 2010.”                                (J.A.

290.)

       Cashion noted a timely appeal, and we have jurisdiction

pursuant to 28 U.S.C. § 1291.

       3
       After the FDIC’s motion to strike was filed, Cashion filed
a motion requesting the district court grant him leave to file
the surreply. Cashion asserted that his filing of the surreply
was appropriate given the “new” issues surrounding the 1099-C
Form that he contended were raised for the first time in the
FDIC’s reply brief.


                                             7
                                         II.

       Cashion    raises   three       issues   on   appeal:     (1)   whether    the

district court erred in granting summary judgment to the FDIC

because a genuine issue of material fact exists as to whether

the FDIC is the holder of the Note; (2) whether the district

court abused its discretion in granting the FDIC’s motion to

strike the surreply and Chapman’s affidavit; and (3) whether the

district court erred in granting summary judgment to the FDIC

because a genuine issue of material fact exists as to whether

the Note has been cancelled or assigned.

       We review an award of summary judgment de novo.                      Adams v.

Trs. of the Univ. of N.C.-Wilmington, 640 F.3d 550, 556 (4th

Cir. 2011).       Summary judgment is appropriate if “there is no

genuine   dispute    as    to    any    material     fact   and    the   movant   is

entitled to judgment as a matter of law.”                       Fed. R. Civ. Pro.

56(a).    In considering the matter, we construe the evidence in

the light most favorable to the non-moving party—here, Cashion—

and draw all reasonable inferences in his favor.                   See Adams, 640

F.3d at 556.

       We review the district court’s evidentiary and scheduling

decisions for abuse of discretion.               See Noel v. Artson, 641 F.3d

580,   591   (4th   Cir.     2011)      (stating     that   a    district    court’s

evidentiary      decisions      are   reviewed     for   abuse    of   discretion);

Cray Commc’ns, Inc. v. Novatel Computer Sys., Inc., 33 F.3d 390,

                                          8
396    (4th   Cir.     1994)     (stating         the   district      court’s      decisions

regarding briefing and hearing on summary judgment motions are

reviewed for abuse of discretion).



                                                 A.

       Consistent with the Note’s governing law provision, we look

to North Carolina law to determine whether the FDIC established

that    it    is    the   “holder”         of    the    Note.       The     “holder”      of    a

negotiable         instrument       is   entitled       to    enforce      it.    N.C.    Gen.

Stat. § 25-3-301.          A “holder” is the “individual, corporation, .

. . or any other legal or commercial entity,” N.C. Gen. Stat. §

25-1-201(b)(27), “in possession of a negotiable instrument that

is payable either to bearer or to an identified person that is

the person in possession.”                  N.C. Gen. Stat. § 25-1-201(b)(21).

“When signatures are admitted or established, production of the

instrument         entitles     a       holder    to    recover      on     it   unless      the

defendant      establishes          a    defense.”           L.   Harvey    &    Son   Co.     v.

Jarman, 333 S.E.2d 47, 52 (N.C. Ct. App. 1985) (quoting former

N.C. Gen. Stat. § 25-3-307(2), recodified using similar language

at N.C. Gen. Stat. § 25-3-308).

       The district court rejected Cashion’s contention that the

FDIC had not shown that it is the holder of the Note because it

failed to produce the original Note despite Cashion’s “demand”

in his Answer that it do so.                      Relying on Dobson v. Substitute

                                                 9
Tr. Servs., Inc., 711 S.E.2d 728 (N.C. Ct. App. 2011), and Liles

v. Myers, 248 S.E.2d 385 (N.C. Ct. App. 1978), the district

court concluded that “production of the original Note is not the

only manner in which holder status can be proved” under North

Carolina law.       (J.A. 277.)         The district court observed that the

FDIC had proffered evidence that the Bank was the holder, that

the   FDIC      succeeded    to   all    rights     of    the   Bank     when    it   was

appointed as the Bank’s receiver, and that a true and accurate

copy of the Note was in the record.                  In addition, the district

court observed that Cashion did not dispute the accuracy of the

copy but instead simply “made a ‘strict demand’ for production

of the original Note in his Answer.” 4               (J.A. 277.)

      On     appeal,    Cashion     contends        the   district       court     erred

because the FDIC had not satisfied its burden of proving, under

North Carolina law, that it was the holder of the Note due to

the   failure      to   produce      the    original      Note     in    response      to

Cashion’s demand for “strict proof.”                 (Opening Br. 8.)            Cashion

points     to   Liles   as   establishing       a   party’s      right   under     North

Carolina law to demand such strict proof, and points to the

Bank’s     entering     into      receivership       as    sufficient      to     create

uncertainty as to the content of the Bank’s records.                             Cashion


      4
       The district court also accurately noted that Cashion
“never made a formal discovery request for the production of the
[Note].” (J.A. 277 n.2.)


                                           10
asserts      that    Martin’s        “[c]arefully          crafted     affidavit[]”            is

insufficient         to     prove     holder         status        because       it     was    a

“perfunctory        and     conclusory         verification”          in     the      face    of

Cashion’s demand.          (Opening Br. 18, 22.)

      We   readily        conclude    that      Cashion’s        argument     misconstrues

the relevant North Carolina case law.                         In Liles, the Court of

Appeals of      North      Carolina       held      that   the     plaintiff       failed     to

introduce the promissory “note itself or any other competent

evidence” showing that the plaintiff was the current holder of

the   note.         248    S.E.2d    at    388      (emphasis       added).           Cashion’s

argument ignores the court’s inclusion of the category “or any

other   competent         evidence”       in   asserting       that    Liles       permits      a

debtor to demand strict proof in the form of the original Note

as a mandatory condition precedent before a court can determine

status as a holder.            Any uncertainty remaining after Liles was

eliminated     in     Dobson,       wherein         the    North    Carolina          Court   of

Appeals flatly rejected the same argument now made by Cashion:

that a holder of a note cannot prove his status by producing a

copy of a promissory note as opposed to the original.                                         711

S.E.2d at 730.            In Dobson, the plaintiff introduced a true and

correct copy of the promissory note as well as affidavits from

two   bank    officials      stating       that      the    bank    was    the     owner      and

holder of the note.            Id.        The debtor disputed the accuracy of

the copy, but offered no evidence that the photocopy was not a

                                               11
true and correct copy.             The North Carolina Court of Appeals

noted that “[u]nder similar circumstances” it had

      held that where there is no evidence that photocopies
      of a note or deed of trust are not exact reproductions
      of the original instruments, a party need not present
      the original note or deed of trust and may establish
      that it is the holder of the instruments by presenting
      photocopies of the note or deed of trust.

Id.   The debtor’s “bare statement” denying the authenticity of

the   copy     and     demanding       production              of     the    original      was

“insufficient to cast doubt on [the bank’s] evidence that [it]

is the holder of the note and does not serve as evidence that

the copies are not exact reproductions.”                       Id. at 731.

      So,     too,    Cashion’s     demand          of        “strict       proof”   through

production     of     the     original       Note        is     not     sufficient      under

applicable     North    Carolina       law    to    defeat          summary    judgment     by

creating a genuine issue of material fact.                            Like the debtor in

Dobson, Cashion produced no evidence to suggest that the copy of

the Note in the record was somehow inaccurate, or anything but a

true and correct copy.            Nor did he produce any evidence other

than bald speculation and his “bare statement” that the FDIC did

not possess the original Note.                Cashion also failed to introduce

any   facts    that    question    the       veracity          of   Sherry     M.    Martin’s

affidavit,     which    was    based    on    her    personal           knowledge     of   the

Bank’s records.         See In re Foreclosure by David A. Simpson,

P.C., 711 S.E.2d 165, 174-75 (N.C. Ct. App. 2011) (discussing


                                             12
why an affiant’s factual statements, so long as they are based

on   personal    knowledge,       are    competent        evidence).        In    short,

Cashion came forward with no facts that call into question the

FDIC’s evidence establishing that it is the holder of the Note.

See Econo-Travel Motor Hotel Corp. v. Taylor, 271 S.E.2d 54, 57

(N.C.   1980)        (stating    that     to     create     a    question    of     fact

challenging      this     evidence,      the     debtor    would    have    to     “come

forward with facts, not mere allegations, which controvert the

fact set forth in [the plaintiff’s] case”).                        The copy of the

Note,   coupled       with    Martin’s    affidavit,        is   sufficient       “other

competent evidence” to prove the FDIC’s status as holder of the

Note under North Carolina law.                 The district court thus did not

err in concluding that no genuine issue of material fact existed

as to the FDIC’s status as holder of the Note.



                                          B.

      The district court granted the FDIC’s motion to strike the

surreply and Chapman’s affidavit.                 It characterized the FDIC’s

arguments     regarding         the     1099-C     Form     as     “responses”       and

“rebuttal[s]”        to      issues   raised      in      Cashion’s    response       in

opposition      to    summary     judgment,       rather    than    “‘new’       matters

raised for the first time in the Reply.”                    (J.A. 274.)      As such,

it concluded Cashion “had ample opportunity to present all of

his arguments and evidence regarding the [1099-C Form] in his

                                          13
Responses to the FDIC’s Motion for Summary Judgment,” and could

have    done    so    at    that    time.            (J.A.    275.)        The   court    also

concluded that Chapman’s affidavit provided interpretations of

the 1099-C Form, but because Chapman was not put forward as an

expert witness, such testimony was not admissible as it went

beyond his personal knowledge.

       Cashion       contends      these       decisions       constituted        reversible

error    given       that   both        the    surreply       and    Chapman’s     affidavit

address the important matter of showing why the 1099-C Form was

competent evidence.             He explains that because the surreply and

Chapman affidavit “were offered to aid, rather than hamper, the

decision making process,” Opening Br. 46, and were offered in

response to an argument made for the first time in the reply

brief (that the 1099-C Form was inadmissible and referred to the

collateral for the Note), the district court should not have

stricken them.

       On   this     record,       we    cannot       say    that    the   district      court

abused its discretion in granting the motion to strike Cashion’s

surreply.        Surreplies        are        generally      not     permitted    under    the

local rules of the Western District of North Carolina, Local

Rule    7.1(E),       and    the        parties’        briefing      schedule     did    not

authorize filing one.                   Cashion relied on the 1099-C Form in

opposing       summary      judgment.             The       FDIC’s    reply      brief    then

challenged both the admissibility and weight of this evidence in

                                                14
considering summary judgment.          The reply brief therefore did not

raise a new legal theory or new evidence, but instead responded

to Cashion’s own argument and evidence.              That Cashion failed to

anticipate how the FDIC would respond to his reliance on the

1099-C   Form    does   not    automatically     entitle      him   to    file    a

surreply.   Nor can we discern any other reason that would make

the district court’s decision inequitable.

     As to the decision to strike Chapman’s affidavit, Federal

Rule of Civil Procedure 56(c)(4) requires that “[a]n affidavit

or declaration used to support or oppose a motion [for summary

judgment] must be made on personal knowledge, set out facts that

would be admissible in evidence, and show that the affiant or

declarant   is    competent     to    testify   on   the    matters      stated.”

Chapman’s affidavit gives his lay opinion about the meaning of

the 1099-C Form and challenges Martin’s interpretation of it.

Cashion has failed to show how that testimony reflects Chapman’s

“personal   knowledge”    of    the   1099-C    Form,   nor   can   he;    it    is

speculative and expresses Chapman’s opinion. 5             For these reasons,

the district court did not abuse its discretion in striking the

surreply and Chapman’s affidavit.

     5
       To the extent Cashion argues that Martin’s affidavit
should have been stricken because it, too, went beyond the scope
of Rule 56(c), we note that Cashion failed to move to strike her
affidavit. The district court thus had no occasion to consider
that argument or rule upon it; as such, the matter is not
properly before this Court on appeal.


                                       15
                                                C.

       The district court provided three different bases for its

conclusion         that   the     1099-C   Form       did   not    create    an   issue   of

material         fact   as   to   whether       the    Note    had   been    cancelled    or

assigned.         We need only address one of those grounds in light of

our    conclusion         that     it   was      a    proper      basis     for   rejecting

Cashion’s position. 6             The district court held that “a Form 1099-C

does       not    itself     operate       to    legally       discharge      a   debtor’s

liability,” and thus “does not, standing alone, raise a genuine

issue of material fact regarding [Cashion’s] liability on the

Note.”       (J.A. 283-84.)             The district court held that summary

judgment in favor of the FDIC was therefore appropriate because

the Note was not “sufficient evidence for a jury to return a

verdict in [Cashion’s] favor on the issue of whether the Note .

. . had been cancelled and/or assigned by [the Bank] prior to

the institution of this action.”                     (J.A. 285.)


       6
       At the outset, the district court noted Cashion had not
established a proper foundation for admitting the Form into
evidence, given that it was hearsay and had not been
authenticated pursuant to Rule 803(6) or 902(11) of the Federal
Rules of Evidence.     It then concluded that the 1099-C Form
“appear[ed] to relate not to the assignment or cancellation of
the . . . Note but rather to the assignment or cancellation of
the Note’s collateral” given that the 1099-C Form refers to
“Assignment of Promissory Notes.”    (J.A. 283).   Only then did
the court turn to the basis on which we affirm.       Although we
note some uncertainty as to the validity of these first two
grounds, we need not examine them further given our agreement
with the district court on its third basis of decision.


                                                16
       Cashion contends here, as he did below, that the 1099-C

Form is prima facie evidence that the Note was discharged given

that actual discharge is one of the identifiable events that can

trigger the requirement to send the IRS and debtor copies of the

form.      Cashion points to a handful of state and federal lower

court    decisions          that       support    his    position          that   the   district

court erred in holding that the 1099-C Form does not constitute

sufficient          evidence       of    discharge       to    withstand          a   motion   for

summary judgment.               Under Cashion’s theory of the case, the 1099-

C   Form      is    prima       facie    evidence       of     a    discharge,        and   having

proffered this prima facie evidence, the burden of persuasion

shifted       to    the    FDIC    to     rebut    a    presumption         of    cancellation.

And,     he    contends,          the     FDIC     cannot          successfully       rebut    the

presumption in this case because it has disavowed knowledge of

actions prior to when the Bank entered into receivership.

        The FDIC responds that the 1099-C Form did not create a

genuine       issue       of    material     fact       that       would    preclude        summary

judgment       in    its       favor    because    it    is        not   sufficient     evidence

alone upon which a jury could find in favor of Cashion.                                     Citing

to the relevant IRS regulations, IRS statements regarding 1099-C

Forms, various state and federal lower court opinions, and an

unpublished opinion from the Fifth Circuit (some of which the

district court relied on as well), the FDIC contends that the

1099-C Form did not effectuate a discharge, did not preclude it

                                                  17
from    seeking   to     collect    the    amount        owed    on    the    Note,    and

evidenced   at    most    proof    of   an      intent     to   cancel       rather    than

actual cancellation.        Accordingly, the FDIC asserts the district

court did not err in concluding that the 1099-C Form did not

create a genuine issue of material fact as to whether the Note

had been cancelled or assigned.

       The question before us is relatively straightforward: did

the    introduction      into   evidence        of   the   1099-C      Form    create     a

genuine issue of material fact as to whether the Note had been

cancelled or assigned.             This specific issue is one of first

impression not only before this Court, but apparently before any

federal    appellate     court     through      a    published        opinion.        While

approximately     two    dozen     state     and     federal     cases       discuss   the

legal significance of a creditor filing a Form 1099-C with the

IRS in any analogous context, there is only one relevant federal

appellate court opinion, and it is unpublished.                          See Owens v.

Commissioner, No. 02-61057, 2003 U.S. App. LEXIS 12481 (5th Cir.

May 15, 2003) (per curiam) (unpublished).                       The other opinions,

both published and unpublished, are from the United States Tax

Court,    bankruptcy     courts,    United       States     District         Courts,    and

various state trial and appellate courts.                       As discussed in the

parties’ briefs and observed above, there is no uniformity in

how these courts have resolved the central inquiry.



                                           18
     A small minority of the lower courts have held, as Cashion

urges us to do here, that filing a Form 1099-C with the IRS

constitutes prima facie evidence of an intent to discharge a

loan, at which point the burden of persuasion shifts to the

creditor to proffer evidence that it was filed by mistake or

pursuant to another triggering event in the regulations.                See,

e.g., In re Welsh, No. 06-10831ELF, 2006 WL 3859233 (Bankr. E.D.

Pa. Oct. 27, 2006) (unpublished); Amtrust Bank v. Fossett, 224

P.3d 935, 936-38 (Ariz. Ct. App. 2009); Franklin Credit Mgmt.

Corp. v. Nicholas, 812 A.2d 51, 58-60 (Conn. App. 2002).                These

courts have generally noted that because filing a Form 1099-C

has legal significance to the debtor’s income tax liability, and

because   the     debtor   faces   penalties   or   fines   for   failing   to

comply with the obligations imposed, it would be inequitable to

permit a creditor to collect the debt after having received the

benefit of the “charge-off” of the debt from filing the Form

1099-C.     Lastly, some—but not all—of the courts holding that a

filed Form 1099-C alone is prima facie evidence of discharge

have also recognized that the form can satisfy the applicable

UCC provisions for when a writing constitutes an “intentional

voluntary act” of discharge, and thus itself effectuates the

discharge    of   the   relevant   debt.   See,     e.g.,   Franklin   Credit

Mgmt. Corp., 812 A.2d at 60-61.



                                      19
     While      we    cannot     say   that        the   analysis   summarized     above

lacks    any    support,    we    find    a    different        approach   taken    by   a

majority of the courts to consider the matter ultimately more

persuasive.       That analysis relies principally on the language of

the IRS regulations and the purpose of a Form 1099-C.                              E.g.,

Capital One, N.A. v. Massey, Case No. 4:10-CV-01707, 2011 WL

3299934, *3-*4 (S.D. Tex. Aug. 1, 2011) (unpublished); In re

Zilka, 407 B.R. 684, 687-92 (Bankr. W.D. Pa. 2009); Lifestyles

of Jasper, Inc. v. Gremore, 299 S.W.3d 275, 276-77 (Ky. Ct. App.

2009).

     The       Internal    Revenue       Code       (“IRC”)     sets   forth    certain

reporting requirements to the IRS, 26 U.S.C. § 6050P, which the

IRS regulations have implemented through the Form 1099-C filing

requirement:

     any applicable entity . . . that discharges an
     indebtedness of any person . . . must file an
     information return on Form 1099-C with the Internal
     Revenue Service. Solely for purposes of the reporting
     requirements of [the applicable statute and this
     regulation], a discharge of indebtedness is deemed to
     have occurred . . . if and only if there has occurred
     an identifiable event described in paragraph (b)(2) of
     this section, whether or not an actual discharge of
     indebtedness has occurred on or before the date on
     which the identifiable event has occurred.

26 C.F.R. § 1.6070P-1(a) (emphasis added).                      Subsection (b)(2) of

26 C.F.R. § 1.6070P-1 lists eight “identifiable events” that

trigger    the       reporting    obligation.             The    identifiable      events

include discharge through the debtor’s filing for bankruptcy,

                                              20
the expiration of the statute of limitations for collection,

discharge by agreement of the parties, a creditor’s decision “to

discontinue          collection     activity        and     discharge         debt,”     and

“expiration      of     the   non-payment      testing       period.”         §     1.6070P-

1(b)(2)(i).

       Tracking the plain language of the regulation, a creditor

may be obligated to file a Form 1099-C even though an actual

discharge       of    indebtedness     has     not    yet     occurred        or    is   not

contemplated.          Cf. Subsection (a).            Moreover, the identifiable

event    triggering         the   obligation     may       not    involve      an    actual

discharge       of    the   debt;   rather,     the       event   may    be    deemed     to

constitute a “discharge” “[s]olely for purposes of” determining

the Form 1099-C reporting obligation.                      Cf. id. and subsection

(b).

       The plain language of the regulation leads us to conclude

that filing a Form 1099-C is a creditor’s required means of

satisfying a reporting obligation to the IRS; it is not a means

of accomplishing an actual discharge of debt, nor is it required

only    where    an    actual     discharge    has        already    occurred.           This

understanding of the creditor’s obligation to file a Form 1099-C

is also clearly expressed in the IRS’s own interpretation of the

regulations.         Two IRS Information Letters issued in October 2005

addressed       concerns      regarding       the     impact        of   a     creditor’s

compliance with the Form 1099-C reporting obligation and the

                                          21
continuing liability of a debtor on the subject debt.                          I.R.S.

Info. 2005-0207, 2005 WL 3561135 (Dec. 30, 2005); I.R.S. Info.

2005-0208, 2005 WL 3561136 (Dec. 30, 2005).                      In the first, the

IRS addressed a creditor’s concern that filing the Form 1099-C

would constitute a written admission that it had discharged the

debt and would therefore make debtors unwilling to pay on their

obligations.       Citing subsection (a) of the regulations discussed

above, the IRS responded that it “does not view a Form 1099-C as

an admission by the creditor that it has discharged the debt and

can no longer pursue collection.”                I.R.S.        Info. 2005-0207.      In

the second letter, the IRS assured a concerned creditor that

filing a Form 1099-C satisfies the reporting requirements of

statute and implementing regulations, neither of which “prohibit

collection activity after a creditor reports by filing a Form

1099-C.”       I.R.S. Info. 2005-0208.

         The   IRS,   the   administrative            agency    charged    with     the

obligation of implementing IRC § 6050P through its regulations,

thus     treats    the   Form     1099-C    as    a    means     for   satisfying     a

reporting obligation and not as an instrument effectuating a

discharge of debt or preventing a creditor from seeking payment

on   a    debt.       Moreover,    as   the      IRS    correctly      noted   in   the

foregoing Information Letters, nothing in the relevant statute

or regulations prohibits collection following the filing of a



                                           22
Form 1099-C. 7           Although the IRS’ interpretation is expressed in

an information letter rather than a regulation or ruling, and

thus       is     not    subject        to     Chevron 8-style       deference,         it    is

nonetheless “entitled to respect . . . to the extent that [its]

interpretations have the power to persuade.”                                Christensen v.

Harris      County,      529     U.S.    576,     587    (2000)      (internal        quotation

marks omitted); see Dominion Res., Inc. v. United States, 219

F.3d       359,    366    (4th    Cir.        2000).      We    find    the    IRS’s         view

persuasive because it fully encompasses the purpose of a Form

1099-C      as     an    IRS   reporting        document       and   follows      the     plain

language of the relevant regulation.

       As       noted,     several           courts     have    expressed         a    similar

interpretation of the filing of a Form 1099-C, and although none

of   their        opinions     are   binding      on    us,    we    note   the       reasoning

expressed in some of them.                     In Owens v. Commissioner, No. 02-

61057, 2003 U.S. App. LEXIS 12481 (5th Cir. May 15, 2003) (per

curiam) (unpublished), the Fifth Circuit observed that a Form

1099-C was not evidence that the creditor had actually cancelled

a debt, but rather reflected at most an intention to cancel the

debt in the future.              Id. at *11-*12.          It thus criticized the IRS

       7
       While some of the circumstances triggering the obligation
to file a Form 1099-C may bar collection, it is that separate
circumstance and not the fact of filing a Form 1099-C that acts
as the bar.
     8
       Chevron U.S.A. Inc. v. Natural Res. Defense Council, Inc.,
467 U.S. 837 (1984).


                                                23
for not “bother[ing] to follow up on the intention . . . to

verify actual cancellation” and instead relying solely on the

issuance of a Form 1099-C when it charged the taxpayers with

being deficient on their income taxes.              Id. at *12.

     In   a   case    more     similar    in    setting   to    that    at     bar,   in

Capital One, N.A. v. Massey, No. 4:10-CV-01707, 2011 WL 3299934

(S.D.   Texas    Aug.    1,    2011)     (unpublished),        the    United    States

District Court for the Southern District of Texas “adopt[ed] the

view that a 1099-C does not discharge debtors from liability”

because   the     form    is    “issued    to    comply     with      IRS    reporting

requirements” and the IRS does not view it “as a legal admission

that a debtor is absolved from liability for a debt.”                          2011 WL

3299934, at *3.          Accordingly, the Capital One court held that

“the fact that [a creditor] issued a 1099-C in relation to the

Borrowers’      indebtedness     is    irrelevant     and      does    not    raise   a

genuine issue of material fact” as to whether the debt had been

cancelled.      Id.

     Here, Cashion claims that the 1099-C Form is prima facie

evidence, in and of itself, that the Note has been cancelled.

We disagree.      As noted earlier, the IRS did not create the form

as a means of effectuating the discharge of a debt.                             It is,

instead, a reporting mechanism to the IRS.                  Moreover, because a

creditor can be required to file a Form 1099-C even where a debt

has not been cancelled, the mere fact that a Form 1099-C is

                                          24
filed does not constitute sufficient evidence, standing alone,

that a debt has been cancelled.            Without more, it is impossible

for a court to know what the existence of a filed Form 1099-C

means.    It may mean the debt has been discharged; it may mean

the creditor intended to discharge the debt in the future; or it

may   mean   that   another   of   the     “identifiable   events”   in   the

regulation     occurred       apart      from    an   actual    discharge.

Furthermore, it may also have simply been filed by mistake.               The

bare Form 1099-C alone, which is Cashion’s sole evidence of debt

discharge in this case, does not provide any of the contextual

clues needed to decide between these alternatives.

      Summary judgment is appropriate if the record shows that

“there is no genuine issue as to any material fact and that the

movant is entitled to judgment as a matter of law.”                  Fed. R.

Civ. P. 56(a).       A “genuine issue” of fact exists “when the

evidence would allow a reasonable jury to return a verdict for

the nonmoving party.”         News & Observer Publ’g Co. v. Raleigh-

Durham Airport Auth., 597 F.3d 570, 576 (4th Cir. 2010) (citing

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)).               The

nonmoving party “‘may not rely merely on allegations or denials

in [his] own pleading’ but must ‘set out specific facts showing

a genuine issue for trial.’”          Id. (quoting Fed. R. Civil Pro.

56(e)).



                                      25
      Cashion’s claim of cancellation or assignment of the Note

is based solely on the 1099-C Form.                He never proffered a reason

for   cancellation      or   any    evidence    beside      the    1099-C    Form    he

received to prove cancellation.                Cashion admitted he had not

paid the Note.9      Only Cashion’s bald speculation ties his receipt

of the 1099-C Form to a specific reason as to why the Bank would

have issued it.         As a matter of law, a jury could not have

rendered    a   verdict      in    Cashion’s       favor    that    the     Note    was

cancelled or assigned when the sole evidence put forth was the

1099-C Form.       As such, there is no genuine issue of material

fact in this case.           See Matsushita Elec. Indus. Co. v. Zenith

Radio Corp., 475 U.S. 574, 586-87 (1986) (In the context of

whether an issue of fact is “genuine,” an opponent of summary

judgment   “must   do    more      than   simply    show    that    there    is    some

metaphysical doubt as to the material facts.”                       He “must come

forward with ‘specific facts showing that there is a genuine

issue for trial.’        Where the record taken as a whole could not

lead a rational trier of fact to find for the nonmoving party,

there is no ‘genuine issue for trial.’”).

      In   so   holding,      we    are    careful     to    note    the     specific

circumstances of this case and the narrowness of our holding.

      9
       Significantly, Cashion never sought discovery related to
the issuance of the 1099-C Form or attempted to develop the
record beyond the mere existence of the form as support for his
argument.


                                          26
The case at bar is likely an oddity, where the 1099-C Form is

the only evidence of debt discharge before the Court. 10                           This is

not a situation where the evidentiary value of a Form 1099-C is

considered     in        conjunction          with     other        competent      evidence

regarding the circumstances surrounding its filing.                             In another

case, where a properly authenticated Form 1099-C is introduced

into    evidence     along        with       other    circumstantial         evidence      of

cancellation    of       the    debt,    the    Form    1099-C       could    be   properly

considered    by    the        trier    of    fact    under    the     totality     of    the

circumstances       on    the    ultimate       issue    of    whether       the   debt    in

question was, in fact, cancelled.                    But here, because Cashion has

not come forward with evidence that creates a genuine issue of

material    fact    as    to     whether      the    Note     has    been    cancelled     or

assigned, the district court did not err in granting the FDIC’s

motion for summary judgment. 11



       10
        As the dissent observes, the affidavit Cashion submitted
attested that the Bank had cancelled the Note.      The affidavit
plainly represents that Cashion’s only basis for this belief is
the 1099-C Form he received from the Bank.    He offers no basis
in the affidavit as proof of cancellation except the 1099-C Form
itself.    As such, Cashion’s affidavit does not change the
relevant evidence that was before the district court when
considering whether a genuine issue of material fact existed as
to the Note’s cancellation.
     11
        Cashion repeatedly refers to the 1099-C Form as being
evidence of cancellation and/or assignment.     However, he does
not raise any separate argument as to why the district court
erred in concluding the 1099-C Form did not raise a genuine
issue of material fact as to the Note’s assignment than he does
(Continued)
                                              27
                                  III.

     For   the   reasons   set   forth   above,   the   judgment   of   the

district court in favor of the FDIC is

                                                               AFFIRMED.




as to its being evidence of cancellation.         As such, our analysis
need not extend further.


                                   28
KING, Circuit Judge, dissenting:

      With all respect for my distinguished colleagues, I would

vacate the judgment below and remand for trial.                       In ruling on

the   summary     judgment      motion,     the    district     court   improperly

disregarded admissible evidence which, viewed in the light most

favorable to Cashion, creates a genuine dispute of material fact

as to whether Cashion’s $2 million debt to the Bank of Asheville

has been discharged.

      As my friends emphasize, a Form 1099-C does not necessarily

prove the discharge of a debt.              It is of little moment, however,

that IRS regulations specify that a Form 1099-C may be created

“whether     or   not    an     actual      discharge      of   indebtedness    has

occurred.”        See   26    C.F.R.   § 1.6070P-1(a).          In    the   district

court,     Cashion       presented         the    handwritten        Form    1099-C,

referencing the sum of more than $1.9 million, in opposition to

the   FDIC’s       summary      judgment         motion.        Contemporaneously

therewith,     Cashion       filed   his    own   affidavit     asserting,     inter

alia, that “the Bank cancelled the alleged debt,” and that “the

Bank . . . has acknowledged that the debt which is a subject of

this lawsuit has been cancelled and assigned.”                    (J.A. 32, 38.)

Significantly, it was not Cashion’s burden to establish on the

FDIC’s summary judgment motion that his debt to the Bank was

discharged as a matter of law.               Rather, Cashion was obliged to

show merely that there is a genuine dispute of material fact.
      In its reply memorandum, the FDIC asserted that:               (1) the

Form 1099-C constitutes inadmissible hearsay; (2) the Form 1099-

C relates only to the collateral secured by the Note; and (3)

the Form 1099-C is insufficient, on its own, to create a genuine

dispute of material fact as to whether the underlying debt has

been discharged.       As the majority observes, the district court

adopted all three of the FDIC’s arguments.

      First, however, the Form 1099-C is admissible as a business

record,     pursuant   to   Rule   803(6)   of    the   Federal   Rules    of

Evidence.     With its reply in support of summary judgment, the

FDIC filed the affidavit of Sherry Martin, a Resolutions and

Receiverships Specialist familiar with the books and records of

the   Bank.    That    affidavit   establishes    the   provenance   of   the

Bank’s records, relating that

      [t]he books and records in question were made at or
      near the time of the matters therein recorded and were
      kept in the course of [the Bank’s] regularly conducted
      business activity, the regular practice of which was
      to keep such books and records.

J.A. 81.      Martin’s affidavit specifically discusses the Form

1099-C, reciting that “[b]ased on the books and records of [the

Bank], the[] [Form 1099-C] appear[s] to have been sent to Mr.

Cashion by [the Bank.]”        Id. at 82.        These statements are all




                                     30
that is required by Rule 803(6) to render admissible the Form

1099-C. 1

       Second, in concluding that the Form 1099-C relates only to

the collateral secured by the Note, the district court relied on

the Form’s description of the debt as “Assignment of Promissory

Notes.”          J.A. 42.      However, the Form 1099-C lists its relevant

account number as 4436, the Bank’s account number for the loan

and    the       Note.      Thus,     there    are       competing   inferences       to   be

resolved by a jury, not by a court on summary judgment.

       Finally, contrary to the majority’s assertion, this case

does       not    present     the     question      of    whether    the    Form     1099-C,

standing alone, constitutes “sufficient evidence [on] which a

jury could find in favor of Cashion.”                       Ante at 17.       Put simply,

the Form 1099-C cannot be considered in a vacuum.                            It was filed

in    the        district     court    along     with      Cashion’s    own       affidavit,

wherein he verifies that the Bank has cancelled his debt.

       According to the majority, Cashion’s affidavit should be

discounted because it “plainly represents” that the Form 1099-C

provides         the   only    basis    for    Cashion’s       belief      that    the   Bank

discharged his debt.                Ante at 27 n.10.            Though the affidavit

refers to the Form 1099-C, Cashion does not contend that his


       1
       If the proper foundation is established, the Form 1099-C
would likely also be admissible as the statement of an opposing
party, pursuant to Federal Rule of Evidence 801(d)(2).


                                               31
belief is based solely on the Form.                           Indeed, the Form provides

no   explanation           (except      its    references        to     collateral     and    the

account    number          associated         with    the     Note)     for    why   the     Bank

created    and       sent     it   to    Cashion.           In   these    circumstances,        a

reasonable jury would be entitled to infer that the Form 1099-C

reflects        an     intent      on   the     part     of      the    Bank   to    discharge

Cashion’s debt.             Such an inference is supported by the origin of

the Form 1099-C, i.e., the Bank itself, and the FDIC’s failure

to show that the circumstances of the Form’s existence “indicate

[any] lack of trustworthiness.”                      Fed. R. Evid. 803(6)(E). 2

      The majority’s discussion of the divergent legal principles

concerning the evidentiary weight properly accorded a Form 1099-

C    is,   in     my       view,   unnecessary,          and      the    discussion     simply

reinforces           the     proposition        that        “‘reasonable        minds      could

differ’”        on     this    central        point.         Bouchat      v.   Balt.    Ravens

Football Club, Inc., 346 F.3d 514, 522 (4th Cir. 2003) (quoting

      2
       In assessing the meaning of the Form’s reference to
“Cancellation of Debt,” the jury would be entitled to view the
cancellation in several ways, such as, by way of example, a
discharge, a charge-off, a refinancing, a corrupt action by a
Bank officer, or, perhaps, a gift by the Bank.     Any of these
plausible views of the record would give rise to an inference
sufficient to defeat the FDIC’s summary judgment motion, because
it bears the burden on summary judgment of showing the absence
of a genuine dispute of material fact.     See Matsushita Elec.
Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (“[O]n
summary judgment the inferences to be drawn from the underlying
facts . . . must be viewed in the light most favorable to the
party opposing the motion.” (alterations and internal quotation
marks omitted)).


                                                32
Anderson     v.    Liberty     Lobby,    Inc.,    47   U.S.   242,    250    (1986)

(explaining       that,   on   summary    judgment,     court   must     determine

whether “there are any genuine factual issues that properly can

be resolved . . . in favor of either party”)).                       As a result,

summary judgment should not be awarded.

     Finally, I acknowledge that the handwritten Form 1099-C,

viewed in the context of the substantial nature of the loan and

the careful manner in which banks normally do business, could

lead a reasonable factfinder to view this particular Form with

suspicion.        Indeed, if I were the factfinder, I would seriously

question the legitimacy of a handwritten Form 1099-C purporting

to cancel nearly $2 million of debt.               But, as an appeals court,

we do not sit in a factfinding capacity, and neither does a

district     court     when    resolving      a   summary     judgment      motion.

Instead, the question of how the Form 1099-C should influence

the outcome of this case is for a jury.                  Our proper course is

simply to vacate and remand for trial.

     I respectfully dissent.




                                         33
