Romano v. United States Army Core of Engineer (USACE) et al

Filing 40

ORDER re 31 Motion to Dismiss. Amended pleadings due by 1/19/2018. Signed by Judge James Donato on 12/18/17. (jdlc3S, COURT STAFF) (Filed on 12/18/2017)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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THOMAS JAMES ROMANO,
Plaintiff,

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United States District Court
Northern District of California

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Case No. 3:17-cv-00930-JD
ORDER RE MOTION TO DISMISS

v.

Re: Dkt. No. 31
UNITED STATES ARMY CORE OF
ENGINEERS (USACE), et al.,
Defendants.

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Pro se plaintiff Thomas Romano entered into two contracts for the purchase of federal

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personal property. See generally Dkt. No. 1. The first contract concerns a pile of scrap material at

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Grand Coulee Dam in Washington, sold in 2012 by the United States Army Core of Engineers

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(“USACE”) through a Government Services Administration (“GSA”) auction. The second

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contract concerns hydraulic cylinders at Little Goose Dam in Washington, sold in 2015 by

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USACE through a GSA auction. For both sales, Romano was responsible for removing the

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property. Romano’s core factual allegations are that USACE misrepresented the property in both

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sales, did not allow Romano to recover his equipment after failed efforts to remove the scrap

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material at Grand Coulee Dam, and failed to maintain safe conditions or to warn Romano about

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unsafe conditions at Little Goose Dam. Dkt. No. 1 at 2-9.

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Romano requests money damages on various theories of liability sounding in contract, tort,

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and the Constitution. With respect to the scrap sale, Romano appears to allege an unconstitutional

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taking and breach of contract. Id. at 12-13. With respect to the hydraulic cylinder sale, Romano

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alleges false advertising and breach of contract, violations of the government’s duty of good faith

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and fair dealing, violation of implied fiduciary duties, and intentional or negligent infliction of

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emotional distress. Id. at 9-13.

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Defendants USACE and GSA move to dismiss for lack of jurisdiction under Rule 12(b)(1),

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improper venue under Rule 12(b)(3), and for failure to state a claim under Rule 12(b)(6). Dkt. No.

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31. Dismissal in this case turns on whether the Court has subject matter jurisdiction over

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Romano’s claims. Federal subject matter jurisdiction is limited by the doctrine of sovereign

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immunity. “The United States, as sovereign, can only be sued to the extent it has waived its

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sovereign immunity.” Vacek v. U.S. Postal Serv., 447 F.3d 1248, 1250 (9th Cir. 2006). This

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applies to “federal agencies and to federal employees acting within their official capacities.”

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Hodge v. Dalton, 107 F.3d 705, 707 (9th Cir. 1997).
The plaintiff bears the burden of showing that the government has waived its immunity to

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suit. Prescott v. United States, 973 F.2d 696, 701 (9th Cir. 1992). “A waiver of the Federal

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United States District Court
Northern District of California

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Government’s sovereign immunity must be unequivocally expressed in statutory text . . . .

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Moreover, a waiver of the Government’s sovereign immunity will be strictly construed, in terms

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of its scope, in favor of the sovereign.” Lane v. Pena, 518 U.S. 187, 192 (1996) (citations

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omitted). Allegations of jurisdictional facts “are not afforded presumptive truthfulness; on a

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motion to dismiss for lack of subject matter jurisdiction, the court may hear evidence of those facts

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and resolve factual disputes where necessary.” Young v. United States, 769 F.3d 1047, 1052 (9th

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Cir. 2014) (quotations and citation omitted).
The Court recognizes its “obligation where the petitioner is pro se . . . to construe the

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pleadings liberally and to afford the petitioner the benefit of any doubt.” Bretz v. Kelman, 773

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F.2d 1026, 1027 (9th Cir. 1985). This liberal approach to pro se pleadings, however, does not

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“supply essential elements of the claim that were not initially pled,” Ivey v. Bd. of Regents of Univ.

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of Alaska, 673 F.2d 266, 268 (9th Cir. 1982), nor can it create subject matter jurisdiction where

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none exists.

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I.

Contract claims
Romano’s contract claims are governed by the framework of the Little Tucker Act and the

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Contract Disputes Act. The Little Tucker Act vests the federal courts with jurisdiction over civil

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actions against the United States seeking less than $10,000. 28 U.S.C. § 1346(a)(2). But

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expressly excluded from this grant of jurisdiction is “any civil action or claim against the United
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States founded upon any express or implied contract with the United States . . . . subject to

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sections 7104(b)(1) and 7107(a)(1) of title 41 [the Contract Disputes Act (‘CDA’)].” The CDA,

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41 U.S.C. §§ 7101, et seq, governs claims “relating to” “any express or implied contract . . . made

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by an executive agency for . . . the disposal of personal property.” 41 U.S.C. §§ 7103, 7102(a)(4).

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Such claims “shall be submitted to the contracting officer for a decision” pursuant to the

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procedures described in Section 7103. 41 U.S.C. § 7103. “The contracting officer’s decision on a

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claim is final and conclusive and is not subject to review by any forum, tribunal, or Federal

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Government agency, unless an appeal or action is timely commenced as authorized by this

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chapter.” 41 U.S.C. § 7103(g). Section 7104(b)(1) allows an action to be brought in the Court of

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United States District Court
Northern District of California

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Federal Claims, but not in the United States district courts. 41 U.S.C. § 7104(b)(1).
The two sales raised in Romano’s complaint are contracts made by an executive agency for

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the disposal of personal property. Consequently, they are governed by the CDA and any claims

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relating to those contracts may not be brought in federal district court. That includes, for the

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hydraulic cylinder sale, Romano’s claims of false advertising, breach of contract, breach of the

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implied covenant of good faith and fair dealing, and breach of implied fiduciary duty. For the

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scrap sale, to the extent that Romano seeks damages on a contractual theory, that claim must also

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be dismissed for lack of jurisdiction. Because amendment would be futile, these contract claims

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are dismissed with prejudice.

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The Court declines to transfer Romano’s claims to the Court of Federal Claims under 28

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U.S.C. Section 1631. This provision authorizes the transfer of a civil action to the Court of

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Federal Claims if a transfer would be in the interest of justice and if the action “could have been

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brought at the time it was filed or noticed.” 28 U.S.C. § 1631. Transfer in this case is

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inappropriate because on the record before the Court, Romano could not have brought this action

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before the Court of Federal Claims in the first instance.

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First, for contract claims arising out of the hydraulic cylinder sale, Romano has not shown

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that he first submitted a claim as required by Section 7103. “While a claim need not use particular

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language to satisfy CDA requirements, the contractor must submit in writing to the contracting

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officer a clear and unequivocal statement that gives the contracting officer adequate notice of the
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basis and amount of the claim.” SITCO Gen. Trading & Contracting Co. v. United States, 87 Fed.

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Cl. 506, 508 (2009) (quotations and citation omitted). The government has submitted extensive

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documentation of Romano’s communications with the officer in charge of the hydraulic cylinder

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contract. See generally Dkt. No. 11. Those submissions show that Romano did not raise any

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allegations of contractual liability. Indeed, Romano was refunded the purchase price. Dkt. No.

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11-7. Although Romano told the contracting officer that he had been injured while working on-

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site, that did not amount to a “clear and unequivocal statement” giving GSA “adequate notice of

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the basis and amount” of any claim. Dkt. No. 11-6.
Next, for contract claims arising out of the scrap sale, assuming for discussion purposes

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only that Romano did submit a claim pursuant to Section 7103, he failed to appeal the contracting

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United States District Court
Northern District of California

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officer’s decision on that claim within twelve months. In 2012, Romano and a GSA contracting

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officer exchanged multiple emails about his dissatisfactions with the sale. See, e.g., Dkt. No. 10-8.

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In October 2012, Romano rejected GSA’s offer of a partial refund. Dkt. No. 10-13. In October

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and November 2012, the GSA contracting officer informed Romano that because Romano had

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rejected the offer of a partial refund, had not specified what he sought in damages, and in GSA’s

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view, failed to submit a claim as required by the CDA, the matter was closed. Dkt. Nos. 10-14,

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10-15. Assuming that that constituted a contracting officer’s decision under Section 7103,

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Romano was required to file in the Court of Federal Claims within 12 months. 41 U.S.C. §

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7104(b)(3). Because Romano filed the instant complaint in February 2017, even if he had filed in

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the proper court, his claims would be barred.

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II.

Tort claims

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Romano’s tort claims are governed by the Federal Torts Claim Act (“FTCA”). The FTCA

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states that no action shall be instituted “for money damages for injury or loss of personal property

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or personal injury . . . unless the claimant shall have first presented the claim to the appropriate

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Federal agency and his claim shall have been finally denied by the agency.” 28 U.S.C. § 2675(a).

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This exhaustion requirement presents a jurisdictional bar and may not be waived. Spawr v. United

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States, 796 F.2d 279, 280 (9th Cir. 1986). Section 2675(a) requires that the claimant “file (1) a

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written statement sufficiently describing the injury to enable the agency to begin its own
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investigation, and (2) a sum certain damages claim.” Warren v. U.S. Dep't of Interior Bureau of

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Land Mgmt., 724 F.2d 776, 780 (9th Cir. 1984).
Romano has not shown that he presented his claims to the relevant federal agencies as

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required. Although Romano states in his opposition that he “has tried some administrative

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remedies in the past,” Dkt. No. 27 at 3, he offers no details or documentation about his attempts to

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resolve those claims. Further, the government has submitted declarations as of April 2017

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indicating that no formal administrative claims have been filed with any of the involved agencies.

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Dkt. No. 7 (USACE claims officer testifying that he could locate no claims involving the

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hydraulic cylinder sale); Dkt. No. 8 (Bureau of Reclamation claims officer testifying that she
could locate no claims referencing the scrap sale); Dkt. No. 9 (GSA paralegal specialist testifying

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United States District Court
Northern District of California

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that she could locate no claims involving Romano).

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Consequently, the Court lacks jurisdiction over all of Romano’s tort claims. That includes

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his claims for intentional and negligent infliction of emotional distress arising out of the hydraulic

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cylinder sale. To the extent that Romano seeks damages arising out of the failed scrap sale on a

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conversion theory, that claim must also be dismissed for lack of jurisdiction. These claims are all

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dismissed without prejudice. Romano may be able to address his tort claims’ jurisdictional defects

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by showing that he complied with the FTCA’s exhaustion requirement. Because Romano is pro

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se, the Court also reminds him that he must additionally show his compliance with the FTCA’s

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timeliness requirements. 28 U.S.C. § 2401(b).

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III.

Takings claim
Reading Romano’s complaint generously, one more potential claim remains. Romano

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alleges that the government did not return his payment for the scrap metal sale, did not allow him

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to timely recover his forklift from Grand Coulee, and did not return Romano’s metal container

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bins. Dkt. No. 1 at 12-13. Romano argues that this violates the Fifth Amendment’s takings

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clause, which allows a property owner “to secure compensation in the event of otherwise proper

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interference amounting to a taking.” Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 537 (2005).

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Assuming for discussion purposes only that Romano has stated a valid takings claim under
the Fifth Amendment, the Court must nevertheless dismiss. If Romano seeks more than $10,000,
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then the Court lacks jurisdiction because the Tucker Act gives the Federal Court of Claims

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exclusive jurisdiction over “any claim against the United States . . . founded upon the

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Constitution” that seeks more than $10,000. 28 U.S.C. §§ 1491(a), 1346(a)(2).

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If Romano seeks less than $10,000, then venue is improper. The Little Tucker Act allows

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Romano to seek money damages for constitutional claims in federal district court only “in the

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judicial district where the plaintiff resides.” 28 U.S.C. § 1402(a)(1). Romano is not a resident of

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this judicial district. Romano instead represents that “he is a resident of China where he lives with

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his wife and three kids” and denies that he is a resident of New Jersey, though his complaint lists a

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New Jersey return address. Dkt. No. 27 at 2.

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United States District Court
Northern District of California

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Because amendment would fix neither the jurisdictional obstacle nor the venue obstacle,
Romano’s takings claim is dismissed with prejudice.
CONCLUSION

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Romano’s contract and takings claims are dismissed with prejudice. Romano’s tort claims

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are dismissed without prejudice. Romano may amend his complaint by January 19, 2017. The

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Court cautions Romano that if he wishes to amend his tort claims, he must show compliance with

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the timeliness and exhaustion requirements of the FTCA. Romano is also advised that failure to

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amend by the Court’s deadline may result in dismissal with prejudice under FRCP Rule 41(b).

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IT IS SO ORDERED.
Dated: December 18, 2017

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JAMES DONATO
United States District Judge

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