Global Fin Corp v. United States , 67 F. App'x 740 ( 2003 )

Opinions of the United
2003 Decisions States Court of Appeals
for the Third Circuit
6-26-2003
Global Fin Corp v. USA
Precedential or Non-Precedential: Non-Precedential
Docket No. 02-1993
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
____________
No: 02-1993
_______________
GLOBAL FINANCIAL CORPORATION,
Appellant
v.
UNITED STATES OF AMERICA
Appeal from the United States District Court
for the District of New Jersey
(D.C. Civil Action No.00-cv-05577)
District Judge: Honorable Garrett E. Brown, Jr.
___________________
Submitted Under Third Circuit LAR 34.1(a)
on January 13, 2003
Before: ROTH, FUENTES and ALDISERT, Circuit Judges
(Opinion filed June 26, 2003)
OPINION
ROTH, Circuit Judge.
The Federal Government moved to dismiss two claims brought by appellant
Global Financial Corporation in the United States District Court for the District of New
Jersey. Global brought claims against the United States for (1) negligence concerning the
assignment of claims and (2) violation of the Assignment of Claims Act (the “Assignment
Act”) under which Global contended it had a private right of action. The District Court
dismissed the claim for negligence because it failed to state a claim upon which relief
could be granted.1 F ED. R. C IV. P. 12(c). The District Court dismissed the claim for a
private right of action because it lacked subject matter jurisdiction. F ED. R. C IV. P.
12(b)(1). Global Financial appealed both decisions.
We have appellate jurisdiction pursuant to 28 U.S.C. § 1291. The standard of
review for both dismissals is plenary. Gould Electronics, Inc. v. United States, 220 F.3d
169, 176 (3d Cir. 2000) (stating that standard of review for Rule 12(b)(1) motion to
dismiss is plenary); Rose v. Bartle, 871 F.2d 331, 342 (3d Cir. 1989) (stating that standard
of review for Rule 12(c) motion to dismiss is plenary).
Both grounds for appeal involve sovereign immunity. The United States is
immune from liability in tort actions, unless clear statutory consent exists to the contrary.
See United States v. Mitchell, 445 U.S. 535, 538 (1980), remanded to 664 F.2d 265 (Ct.
1
The United States originally filed a Rule 12(b)(6) motion under the Federal Rules of
Civil Procedure. The District Court correctly noted that procedurally the United States
should have filed a Rule 12(c) motion for a judgment on the pleadings because it had
already filed an answer. The District Court treated the motion as if the correct Rule 12(c)
motion had been filed.
Cl. 1981), cert. granted, 457 U.S. 1104 (1982), aff’d by 463 U.S. 206 (1983). Plaintiff
“bears the burden of showing an unequivocal waiver of immunity.” Baker v. United
States, 817 F.2d 560, 562 (9th Cir. 1988), cert. denied, 487 U.S. 1204 (1988) (citations
omitted). The waiver cannot be implied, see United States v. Nordic Village, Inc., 503
U.S. 30, 37 (1987) (insisting upon clarity in statutory text of an “unequivocal expression”
of intent to eliminate sovereign immunity); FMC Corp. v. United States Dept. Of
Commerce, 29 F.3d 833, 839 (3d Cir. 1994) (en banc) (citing United States v. Testan, 424
U.S. 392, 399 (1976)), and must be strictly construed in favor of the Government. See
Nordic Village, 503 U.S. at 34; Ardestani v. INS, 502 U.S. 129, 137 (1991).
Global Financial claims that the District Court erred when it (1) did not find that
the Federal Government had a duty not to accept competing assignments under the
Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 1346 and (2) failed to recognize a waiver
of sovereign immunity on the part of the Federal Government through the context of the
Assignment Act, 31 U.S.C. § 3727, in conjunction with the Tucker Act, 28 U.S.C. §
1491. It is not clear whether Global Financial’s negligence claim was based on a duty not
to accept competing assignments or a duty to inform Global Financial of a competing
assignment. The misrepresentation exception 2 to the FTCA only applies to the latter. See
28 U.S.C.A. § 2680(h). Viewing the facts in the light most favorable to the nonmoving
party, the District Court correctly dismissed the latter basis for the claim and addressed
2
The misrepresentation exception to the FTCA states that the FTCA is not applicable
to claims that arise out of “misrepresentation.” 28 U.S.C. § 2680(h).
the former.
The FTCA waives the Government’s sovereign immunity from tort actions. See
Rayonier, Inc. v. United States, 352 U.S. 315, 319 (1957). This waiver of immunity is,
however, only for recognized causes of action. See Feres v. United States, 340 U.S. 135,
142 (1950). The District Court determined that New Jersey tort law governed this case.3
Therefore, the FTCA would only be applicable against the Government if non-
compliance with the Assignment Act requirements provided a cause of action against a
private individual under New Jersey tort law. See Rayonier, 352 U.S. at 319, Indian
Towing Co. v. United States, 350 U.S. 61, 68 (1955).
A waiver of sovereign immunity may not be implicitly enlarged or extended to
include causes of action not within the terms of the statute. See Klamath and Moadac
Tribes v. United States, 296 U.S. 244, 250 (1935). Global Financial’s claim is based on
the “tort of another” doctrine, an element of which is the commission of a tort by the
defendant. See R ESTATEMENT (S ECOND) T ORTS § 914(2). Under New Jersey tort law, no
3
Under the FTCA, the applicable law is “the law of the place where the act or omission
occurred.” 28 U.S.C. § 1346(b); see also United States v. Muniz, 374 U.S. 150, 152
(1963) (citing 28 U.S.C. § 1346(b)). The District Court conducted a thorough choice of
law analysis because the parties were in dispute over whether Texas or New Jersey law
applied to Global Financial’s claim. The District Court concluded that the tort law
standard that applied to this case was the tort law of New Jersey. Although the tortious
act was committed in Texas, the District Court determined that Texas choice-of-law rules
employ the“significant relationship” test. R ESTATEMENT (S ECOND) OF C ONFLICTS §§ 6,
145. Under this test, the New Jersey tort laws would be applicable because the injury
suffered and the payment of litigation costs took place in New Jersey. Neither party
disputed this conclusion on appeal.
cause of action for negligence has been established against private individuals for
accepting and acknowledging competing assignments. The breach of contract cases 4
Global Financial cites in its brief are not sufficient to satisfy the FTCA requirements for
Government waiver of sovereign immunity. The FTCA concerns waiver of sovereign
immunity for tortious acts committed by the Government and not for breach of
contractual duties committed by the Government. See Petersburg Borough v. United
States, 839 F.2d 161, 162 (3d Cir. 1988) (distinguishing between tort and contract duties).
Because New Jersey case law does not provide an unequivocal cause of action in tort law
against private individuals for violation of the Assignment Act requirements, the United
States did not owe a duty of care to Global Financial. We will affirm the District Court’s
conclusion that the complaint failed to state a claim on which relief could be granted.
As to the Assignment Act claim, a district court lacks subject matter jurisdiction
for claims against the United States where sovereign immunity has not been waived. The
Assignment Act provides for an assignee to make a claim against the United States “to
recover payment for work performed by the contractor.” Thomas Funding Corp. v.
United States, 15 Cl. Ct. 495, 502 (1988). It does not, however, provide for recovery of
damages caused by the Government’s violations of the Assignment Act’s provisions.
Neither does the Assignment Act contain an unequivocal waiver of the Government’s
sovereign immunity for failure to comply with its provisions.
4
Spilka v. South America Managers, Inc., 255 A.2d 755 (N.J. 1969); Tirgan v. Mega
Life & Health Ins., 700 A.2d 1239 (N.J. Super. Ct. Law Div. 1997)). These cases
concerned liability of private individuals for breach of contractual duties.
Global invokes the Tucker Act, 28 U.S.C. § 1491, to create waiver of sovereign
immunity. The Tucker Act is, however, a jurisdictional statute. It does not provide for
any substantive right of recovery. See 28 U.S.C. § 1491(a)(1). Any claim made under the
Tucker Act must be founded in “the Constitution, or any Act of Congress or any
regulation of an executive department, or upon any express or implied contract with the
United States, or for liquidated or unliquidated damages in cases not sounding in tort.”
Id.; see also United States v. Mitchell, 463 U.S. 206, 216 (1983) (citing 28 U.S.C. §
1491(a)(1)). To be cognizable under the Tucker Act, the source of law relied upon must
establish a claim for money damages against the United States. See M itchell, 463 U.S. at
216. Further, a fair interpretation of the law must show that it mandates compensation
from the United States for the damages incurred. See id.The Assignment Act does not, however, mandate compensatory damages for non-
compliance with its provisions. The Assignment Act’s waiver of sovereign immunity for
claims of wrongful payment of funds under the assignment does not invoke the Tucker
Act’s waiver for damages claims for violations of the Assignment Act. Therefore, the
Tucker Act is not applicable to Assignment Act violations.5 We will affirm the District
Court’s order, dismissing the claim for lack of subject matter jurisdiction, because neither
the Assignment Act nor the Tucker Act in conjunction with the Assignment Act provide
5
Moreover, if the Tucker Act were applicable to the current case, the District Court
would have lacked subject matter jurisdiction over the issue because jurisdiction under
the Tucker Act claims belongs to the Untied States Court of Federal Claims. See 28
U.S.C. §§ 1346(a)(2), 1491(a)(1).
for waiver of the Government’s sovereign immunity.
For the foregoing reasons, we will affirm the judgment of the District Court.
_______________________
TO THE CLERK:
Please file the foregoing Opinion.
By the Court,
/s/ Jane R. Roth
Circuit Judge