MORGAN v. VETERANS CANTEEN SERVICES

Filing 36

ORDER granting Defendant's 19 Motion to Dismiss for Failure to State a Claim and this action is dismissed with prejudice. Final judgment will issue under separate order. (See Order). Copy to Plaintiff via U.S. Mail. Signed by Judge Tanya Walton Pratt on 10/26/2018. (MAC)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
JOHN MORGAN,
Plaintiff,
v.
VETERANS CANTEEN SERVICE,
Defendant.

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Case No. 1:18-cv-00463-TWP-DLP

ORDER GRANTING DEFENDANT’S MOTION TO DISMISS
This matter is before the Court on a Motion to Dismiss for Failure to State a Claim filed
pursuant to Federal Rule of Civil Procedure 12(b)(6) by Defendant Veterans Canteen Service
(“VCS”) (Filing No. 19). Pro se Plaintiff John Morgan (“Morgan”) initiated this action, seeking
reimbursement for expenses he incurred on behalf of VCS and relocation expenses. For the
following reasons, the Court grants VCS’s Motion to Dismiss.
I.

BACKGROUND

The following facts are not necessarily objectively true, but as required when reviewing a
motion to dismiss, the Court accepts as true all factual allegations in the complaint and draws all
inferences in favor of Morgan as the non-moving party. See Bielanski v. County of Kane, 550 F.3d
632, 633 (7th Cir. 2008).
VCS is part of the Department of Veteran Affairs and “is an instrumentality of the United
States, created for the primary purpose of making available to veterans of the Armed Forces who
are hospitalized or domiciled in hospitals and homes of the Department, at reasonable prices,
articles of merchandise and services essential to their comfort and well-being.” 38 U.S.C. § 7801.

Congress has authorized the appropriation of federal funds “from time to time,” “[t]o finance the
establishment, maintenance, and operation of [VCS].” 38 U.S.C. § 7804.
Morgan worked for VCS. He was asked to travel to Texas for training and was told that
he would be reimbursed for travel expenses. He traveled for this training but was never reimbursed
for his expenses. He parked his car and it was left in storage for the month her was gone. Morgan
was told VCS would reimburse the storage fee, but they did not. On another occasion, Morgan
incurred work expenses on behalf of VCS when he purchased a freezer and other products for use
at a VCS canteen. However, Morgan was not reimbursed by VCS for purchasing these items.
Finally, Morgan moved to Las Vegas, Nevada to work at a different VCS location. He incurred
expenses for this relocation, but VCS did not reimburse Morgan for his relocation expenses (Filing
No. 1 at 2–4).
On February 16, 2018, Morgan initiated this lawsuit against VCS and asserted a claim for
money damages, requesting payment of $5,458.00 plus 21% interest for the work expenses he
incurred and for travel and relocation reimbursement. Id. at 4. On June 29, 2018, VCS filed its
Motion to Dismiss, asserting sovereign immunity and a lack of subject matter jurisdiction (Filing
No. 19).
II.

LEGAL STANDARD

Federal Rule of Civil Procedure 12(b)(6) allows a defendant to move to dismiss a complaint
that has failed to “state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). When
deciding a motion to dismiss under Rule 12(b)(6), the Court accepts as true all factual allegations
in the complaint and draws all inferences in favor of the plaintiff. Bielanski, 550 F.3d at 633.
However, courts “are not obliged to accept as true legal conclusions or unsupported conclusions
of fact.” Hickey v. O’Bannon, 287 F.3d 656, 658 (7th Cir. 2002).

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The complaint must contain a “short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). In Bell Atlantic Corp. v. Twombly, the U.S.
Supreme Court explained that the complaint must allege facts that are “enough to raise a right to
relief above the speculative level.” 550 U.S. 544, 555 (2007). Although “detailed factual
allegations” are not required, mere “labels,” “conclusions,” or “formulaic recitation[s] of the
elements of a cause of action” are insufficient. Id.; see also Bissessur v. Ind. Univ. Bd. of Trs., 581
F.3d 599, 603 (7th Cir. 2009) (“it is not enough to give a threadbare recitation of the elements of
a claim without factual support”). The allegations must “give the defendant fair notice of what the
. . . claim is and the grounds upon which it rests.” Twombly, 550 U.S. at 555. Stated differently,
the complaint must include “enough facts to state a claim to relief that is plausible on its face.”
Hecker v. Deere & Co., 556 F.3d 575, 580 (7th Cir. 2009) (citation and quotation marks omitted).
To be facially plausible, the complaint must allow “the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(citing Twombly, 550 U.S. at 556).
Additionally, “[a] document filed pro se is to be liberally construed, and a pro se complaint,
however inartfully pleaded, must be held to less stringent standards than formal pleadings drafted
by lawyers.” Erickson v. Pardus, 551 U.S. 89, 94 (2007). However, the Court notes that:
[I]t is also well established that pro se litigants are not excused from compliance
with procedural rules. [T]he Supreme Court has never suggested that procedural
rules in ordinary civil litigation should be interpreted so as to excuse mistakes by
those who proceed without counsel[.] Further, as the Supreme Court has noted, in
the long run, experience teaches that strict adherence to the procedural requirements
specified by the legislature is the best guarantee of evenhanded administration of
the law.
Loubser v. United States, 606 F. Supp. 2d 897, 909 (N.D. Ind. 2009) (citations and quotation marks
omitted).

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III. DISCUSSION
Morgan contends that VCS should pay money damages to him for VCS’s failure to
reimburse travel, relocation, and other work-related expenses. In response, VCS argues that
Morgan’s claim for money damages is barred because “[a]bsent a waiver of sovereign immunity,
the Court lacks subject matter jurisdiction over claims for money damages against the United
States and its agencies.” FDIC v. Meyer, 510 U.S. 471, 475 (1994). “It is axiomatic that the
United States may not be sued without its consent and that the existence of consent is a prerequisite
for jurisdiction.” United States v. Mitchell, 463 U.S. 206, 212 (1983).
Absent a waiver of sovereign immunity, the Court lacks subject matter jurisdiction over
claims for money damages against the United States and its agencies. FDIC v. Meyer, 510 U.S.
471, 475 (1994). Any waiver of sovereign immunity “must be unequivocally expressed in
statutory text” and cannot be implied. Lane v. Pena, 518 U.S. 187, 192 (1996). The plaintiff bears
the burden of establishing that any waiver of sovereign immunity encompasses his claim. See
Lundeen v. Mineta, 291 F.3d 300, 304 (5th Cir. 2002). To maintain a viable claim against the
United States or its agencies in federal court, a plaintiff must identify both a statute that confers
subject matter jurisdiction on the district court and a federal law that waives the sovereign
immunity of the United States to the cause of action. Macklin v. United States, 300 F.3d 814, 819
(7th Cir. 2002). The plaintiff’s failure to satisfy either of these requirements mandates the
dismissal of his claim. Id.
VCS notes that is has not waived its sovereign immunity and argues that, on its face,
Morgan’s Complaint fails to identify a plausible basis, statutory or otherwise, for subject matter
jurisdiction or a federal law that waives the sovereign immunity of the United States and its

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agencies to be subjected to a suit for money damages. VCS asserts that these failures are fatal to
Morgan’s claims and justify the dismissal of his Complaint.
In response to the Motion to Dismiss, Morgan reasserts the allegations of his Complaint,
explaining that he indeed was an employee of VCS and incurred expenses on behalf of VCS—
purchasing products, traveling to an employee training, and relocating to a different work location.
(Filing No. 30 at 2.) He alleges he was never reimbursed for these expenses, and he asserts that
he has a “rightful claim” and a “righteous claim.” (Filing No. 22 at 3, 4.)
Morgan argues this Court has subject matter jurisdiction because he is suing a federal
agency and “his claim is less than [$]10,000.” (Filing No. 30 at 1.) He additionally argues that
his claim is for “breach of contract.” (Id. at 2.) Morgan states, “I may be wrong but I also believe
[the] contract disputes act is [an] act that governs all procurement contract[] disputes regarding
government asking that you do something then not paying you for it.” Id. Although Morgan’s
fill-in-the-blank complaint form had the box checked for jurisdiction based on a state law claim
between citizens of different states (Filing No. 1 at 4), it appears that Morgan is asserting
jurisdiction under 28 U.S.C. § 1346 and claiming a waiver of sovereign immunity pursuant to the
Contract Disputes Act of 1978 (Filing No. 30 at 1–2).
Congress has provided in 28 U.S.C. § 1346 that the federal “district courts shall have
original jurisdiction, concurrent with the United States Court of Federal Claims, of . . . [a]ny other
civil action or claim against the United States, not exceeding $10,000 in amount, founded . . . upon
any express or implied contract with the United States.” 28 U.S.C. § 1346(a)(2). However, this
subsection further states, “the district courts shall not have jurisdiction of any civil action or claim
against the United States founded upon any express or implied contract with the United States . . .
which are subject to sections 7104(b)(1) and 7107(a)(1) of title 41.” Id.

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Claims brought pursuant to “sections 7104(b)(1) and 7107(a)(1) of title 41,” for which the
federal district courts do not have jurisdiction, fall under the Contract Disputes Act of 1978
(“CDA”), which is codified at 41 U.S.C. §§ 7101–7109. Thus, while it appears that Morgan is
bringing his “breach of contract” claim under the CDA and asserting a waiver of sovereign
immunity pursuant to the CDA, it is clear that “the district courts shall not have jurisdiction” for
such a claim. 28 U.S.C. § 1346(a)(2).
The CDA, which concerns public contracts, applies to any express or implied contract
made by an executive agency for the procurement of property or the procurement of services. 41
U.S.C. § 7102. Under the CDA, a claim asserted by a “contractor” against the federal government
relating to a contract dispute must first be submitted in writing to a “contracting officer” for an
administrative decision. 41 U.S.C. § 7103. If the contractor does not agree with the contracting
officer’s decision, the contractor may appeal the decision to the agency board, 41 U.S.C. § 7104(a),
or the “contractor may bring an action directly on the claim in the United States Court of Federal
Claims.” 41 U.S.C. § 7104(b). Under the CDA, when an agency board considers an appeal and
issues a decision, the contractor may appeal the agency board’s decision to the United States Court
of Appeals for the Federal Circuit. 41 U.S.C. § 7107(a)(1)(A). There are no allegations that
Morgan followed these procedures for pursuing a CDA claim, and in any event, such a claim is
properly brought before the United States Court of Federal Claims or the United States Court of
Appeals for the Federal Circuit, rather than before a District Court.
If Morgan simply is pursuing a claim for money damages against a federal agency, and not
bringing a CDA claim, he has failed to show a waiver of sovereign immunity. Under either theory,
Morgan has failed to plead a claim upon which relief can be granted. Thus, dismissal of this action
is appropriate.

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IV. CONCLUSION
A motion to dismiss pursuant to Rule 12(b)(6) does not test whether the plaintiff will
prevail on the merits but instead whether the claimant has properly stated a claim. See Scheuer v.
Rhodes, 416 U.S. 232, 236 (1974). Although Morgan may be entitled to reimbursement for his
work-related expenditures, for the reasons stated above, the district court is unable to grant the
relief sought. VCA has not waived its sovereign immunity and Morgan’s CDA claim is not
properly brought in this court. Accordingly, Veterans Canteen Service’s Motion to Dismiss for
Failure to State a Claim (Filing No. 19), is GRANTED and this action is dismissed with
prejudice. Final judgment will issue under separate order.

SO ORDERED.
Date: 10/26/2018

DISTRIBUTION:
John Morgan
117 Fountain Lake Drive
Greenfield, Indiana 46140
Gina M. Shields
UNITED STATES ATTORNEY’S OFFICE
[e-mail]

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