Hernandez v. State Farm Mutual Automobile Insurance Company et al

Filing 17

ORDER AND REASONS granting 10 Motion to Dismiss for Failure to State a Claim; denying 13 Motion to Stay. Signed by Judge Helen G. Berrigan on 10/18/2013. (kac, )

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
CAROL HERNANDEZ

CIVIL ACTION

VERSUS

NO. 13-544

STATE FARM MUTUAL AUTOMOBILE
INSURANCE CO., ET AL.

SECTION “C” (2)

ORDER AND REASONS1
Before this Court is a motion to dismiss brought by defendant, the United States of
America. Rec. Doc. 10. Plaintiff, Carol Hernandez, opposes the motion. Rec. Doc. 13. Before
this Court, also, is plaintiff’s motion to stay. Rec. Doc. 13. Defendant, the United States of
America, opposes this motion. Rec. Doc. 15. Having considered the record, the memoranda of
counsel and the law, the Court has determined that the motion to dismiss is GRANTED and the
motion to stay is DENIED for the following reasons.

I. BACKGROUND
This case arises out of an automobile accident between the plaintiff and Mitch Brown, an
employee of the Federal Deposit Insurance Company (“FDIC”), that occurred on August 16,
2011. Rec. Doc. 1-1 at 5. The plaintiff filed suit for damages in the Civil District Court for the
Parish of Louisiana on June 12, 2012. Rec. Doc. 1 at 1. The case was removed to this Court by
the United States on behalf of Mitch Brown because of his status as a federal employee and
because he was acting within the course and scope of his employment at the time of the accident,
as determined by the Assistant United States Attorney. Rec. Doc. 1 at 1-2. Brown’s status as a
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Jennifer Watkins, a third-year student at Tulane University Law School, assisted in the preparation of this Order
and Reasons.

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federal employee invokes the Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 2671 et seq., and
the FTCA substitutes the United States as the party defendant. Rec. Doc. 1 at 2-3, citing 28
U.S.C. § 2679(d)(2). Defendant, the United States, has moved to dismiss pursuant to Fed. R.
Civ. P. 12(b)(1) for lack of subject matter jurisdiction. Rec. Doc. 10 at 1. In this case, after
removal and the subsequent invocation of the FTCA, the plaintiff filed a claim with the FDIC
pursuant to the requirements of the FTCA, with the FDIC confirming submission of this claim
on May 14, 2013. Rec. Doc. 13-1 at 2. Because the FDIC has six months to respond to the
claim and has not yet responded, the plaintiff has moved for a stay until November 15, 2013.
Rec. Doc. 13 at 1.
II. LAW AND ANALYSIS
A. Standard of Review
Federal courts are courts of limited jurisdiction; without jurisdiction authorized by the
Constitution or statute, they lack the power to adjudicate claims. Kokkonen v. Guardian Life Ins.
Co. of Am., 511 U.S. 375, 377 (1994); In re FEMA Trailer Formaldehyde Prod. Liab. Litig.
(Miss. Plaintiffs), 668 F.3d 281, 286 (5th Cir. 2012). A court that lacks the statutory or
constitutional power to adjudicate a case must dismiss the case for lack of subject matter
jurisdiction. Home Builders Ass’n of Miss. v. City of Madison, Miss., 143 F.3d 1006, 1010 (5th
Cir. 1981). When a defendant moves to dismiss for lack of subject matter jurisdiction, the
plaintiff has the burden to establish subject matter jurisdiction. Castro v. United States, 560 F.3d
381, 386 (5th Cir. 2009), vacated on other grounds, 608 F.3d 266 (5th Cir. 2010). As the United
States has moved to dismiss under Rule 12(b)(1), the burden is on the plaintiff to establish that
this Court has subject matter jurisdiction.

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B. The Federal Torts Claim Act
The FTCA provides for damages for injury or loss that result as a consequence of the
negligent actions of a federal employee acting within the course and scope of his or her
employment, by holding the United States liable for such actions. 28 U.S.C. §§ 2672, 2674.
When a federal employee is sued for negligence, the Attorney General has the power to certify
that the employee “was acting within the scope of his office or employment at the time of the
incident out of which the claim arose.” 28 U.S.C. § 2679(d)(1). Upon this certification, the
United States is substituted as the defendant in the action, which is subsequently governed
pursuant to the FTCA. Id. If the case was commenced in state court, it is to be removed to
federal district court with the “Attorney General’s certification ‘conclusiv[e]. . . for purposes of
removal.’” Osborn v. Haley, 549 U.S. 225, 230 (2007) (quoting 28 U.S.C. § 2679(d)(2)).
Defendant argues that the FTCA requires that a potential plaintiff must file a claim with
the appropriate federal agency for damages resulting from the actions of a federal employee that
occur within the course and scope of the federal employee’s employment. Rec. Doc. 10-1 at 4-5
citing 28 U.S.C. § 2675(a). If the claim is denied or if the agency does not respond to the
claimant within six months, at that point, then the claimant may file suit against the United States
for damages, and the defendant argues that this requirement must be strictly construed. Id.
The government is correct that U.S.C. § 2675 requires that the administrative remedies be
exhausted before a suit may be filed against the government under this statute. Failure to do so
leaves “the district court. . . without subject matter jurisdiction.” Price v. United States, 81 F.3d
520, 521 (5th Cir. 1996). Further, courts “must strictly construe the statute; any ambiguities will
be resolved in favor of the sovereign.” McLaurin v. United States, 392 F.3d 774, 780 (5th Cir.

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2004). The text of the statute that “command[s] that an ‘action shall not be instituted. . . unless
the claimant shall have first presented the claim to the appropriate Federal agency and his claim
shall have been finally denied by the agency in writing and sent by certified or registered mail’ is
unambiguous. We are not free to rewrite the statutory text.” McNeil v. United States, 508 U.S.
106, 111 (1993). As noted by the Fifth Circuit, “[S]uits filed [under the FTCA] must be filed in
exact compliance with the terms of consent. . .” Gregory v. Mitchell, 634 F.2d 199, n.1 (5th
Cir.1981). This is because “[a]bsent a waiver of immunity the United States is immune from suit
in tort. Partial waiver, as found in the FTCA, exists wholly by virtue of congressional consent
which fixes the terms and conditions on which suit may be instituted.” Id. at 203.
In regards to plaintiff’s motion to stay the proceedings, when a court lacks subject matter
jurisdiction, it must immediately dismiss the action. Id. at n.2. It cannot hold the matter pending
the outcome from the FDIC “because where the Court does not have jurisdiction, it cannot retain
jurisdiction.” Id. (quoting Fuller v. Daniel, 438 F. Supp. 928, 930 (N.D. Ala. 1977). Being
allowed to stay the claim would be in contradiction with the congressional intent of 28 U.S.C. §
2675. Id. at 204.
After this case was removed pursuant to the FTCA, the plaintiff filed an administrative
claim with the FDIC on May 14, 2013. Because the FTCA must be strictly construed, the
plaintiff must wait until either her claim is denied by the FDIC or until after six months have
lapsed from the date she filed her claim, neither of which has presently occurred. Upon the
occurrence of either of these events, the plaintiff would then be entitled to bring a suit against the
United States in federal district court. The plaintiff has offered no proof that this Court has the
statutory authority to adjudicate this case at this present time because the FCPA requires strict

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adherence to administrative exhaustion prior to the commencement of a suit in federal district
court. Consequently the Court concludes that it lacks subject matter jurisdiction. The plaintiff’s
motion to stay the proceedings cannot be granted because the court presently lacks the necessary
subject matter jurisdiction over the FTCA claim to stay the proceedings.
Accordingly,
IT IS ORDERED that the motion to dismiss filed by the defendant is GRANTED. (Rec.
Doc. 10). The motion to stay filed by the plaintiff is DENIED without prejudice (Rec. Doc. 13).
New Orleans, Louisiana this 18th day of October, 2013.

_________________________________
HELEN G. BERRIGAN
UNITED STATES DISTRICT JUDGE

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