Maxwell et al v. McKay et al

Filing 19

ORDERED that the Motion to Dismiss (ECF No. 6 ) is GRANTED. IT IS FURTHER ORDERED that the Clerk shall enter judgment and close the case. Signed by Judge Robert C. Jones on 6/29/2016. (Copies have been distributed pursuant to the NEF - DRM)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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______________________________________
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ALEXANDRIA C. MAXWELL et al.,
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Plaintiffs,
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vs.
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THERESA MCKAY et al.,
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Defendants.
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3:15-cv-00584-RCJ-WGC
ORDER

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This case arises out of a dispute over survivor benefits payable to the child of a soldier

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killed in action in Afghanistan. Defendants have moved to dismiss for lack of jurisdiction and

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failure to state a claim.

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I.

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FACTS AND PROCEDURAL HISTORY
Plaintiffs Alexandria Maxwell and Roberta Maxwell-Stewart are the surviving child and

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spouse, respectively, of a U.S. Army sergeant killed in Afghanistan. They have sued three

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employees of the Defense Financing and Accounting Service (“DFAS”) for alleged

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miscalculations of (or refusals to approve) benefits under the Survivor Benefit Plan (“SBP”).

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The claims are based on DFAS’s recognition of another child of the decedent (apparently from

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another mother) who is entitled to a share of the available SBP benefits, as well as DFAS’s

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denial of Alexandria’s claim of incapacity for self-support after the age of 22. Defendants have

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moved to dismiss.

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II.

DISCUSSION
The Complaint invokes the Court’s jurisdiction under 42 U.S.C. § 1983 and the

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Administrative Procedures Act (“APA”). The Court must dismiss because no claim is stated

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under § 1983 (or Bivens v. Six Unknown Named Agents of Fed. Bureau of Narcotics, 403 U.S.

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388 (1971)), and there is yet no jurisdiction under the APA.

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First, Plaintiffs have not made out a claim under § 1983, and amendment would be futile.

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Plaintiffs allege action by federal officials acting under color of federal law, and no § 1983 claim

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lies under those circumstances. See 42 U.S.C. § 1983 (“Every person who, under color of any

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statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of

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Columbia, subjects, or causes to be subjected, any citizen of the United States or other person

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within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured

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by the Constitution and laws, shall be liable to the party injured . . . .” (emphases added)). Nor is

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a Bivens action viable. Bivens actions do not lie where there is an alternative, existing process

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whereby a plaintiff may protect his interests, and the availability of judicial review of an agency

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decision is such a process. W. Radio Servs. Co. v. U.S. Forest Serv., 578 F.3d 1116, 1120–21

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(9th Cir. 2009) (citing Wilkie v. Robbins, 551 U.S. 537, 550 (2007)). The Supreme Court has

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explicitly declined to extend Bivens in most contexts. Mirmehdi v. United States, 689 F.3d 975,

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980–81 (9th Cir. 2011) (collecting cases and citing, inter alia, Schweiker v. Chilicky, 487 U.S.

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412 (1988) (holding that denials of social security benefits do not give rise to Bivens claims)).

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Second, although the availability of review under the APA prevents a Bivens claim, there

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is yet no jurisdiction under the APA, because there has been no final agency action. See 5 U.S.C.

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§ 704 (“Agency action made reviewable by statute and final agency action for which there is no

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other adequate remedy in a court are subject to judicial review.”). Defendants note that DFAS

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has issued a decision on the pending claim for unpaid SBP benefits, but that Plaintiffs may still

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appeal to the Defense Office of Hearings and Appeals (“DOHA”). (See Edwards Decl. ¶¶ 8–9,

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ECF No. 9). Congress has authorized the Secretary of Defense to settle the claims at issue here.

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See 31 U.S.C. § 3702(a)(1)(A) (“The Secretary of Defense shall settle . . . claims involving

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uniformed service members’ pay, allowances, . . . and survivor benefits . . . .”). Department of

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Defense Instruction No. 1340.21, which has been codified as an appendix to the CFR, provides

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that appeals of claims made to components such as DFAS must be made within 30 days, upon

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which the component will prepare a report and recommendation for submission to DOHA for a

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final decision after considering any rebuttal by the claimant. (See DODI 1340.21 E7, ECF No. 9-

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1; 32 C.F.R. Pt. 282, App. E(k)). DODI 1340.21 is signed by general counsel for the Department

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of Defense, not the Secretary of Defense, but the Secretary of Defense has via Department of

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Defense Directive 1340.20 vested general counsel with the authority to develop claim settlement

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policies. See DODD 1340.20. As there has yet been no final agency action, the Court has no

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jurisdiction to review DFAS’s rulings. There will presumably be jurisdiction for a court to hear

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an APA claim if Plaintiffs are unsatisfied with DOHA’s eventual decision.

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The Court need not address the qualified immunity issue.
CONCLUSION

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IT IS HEREBY ORDERED that the Motion to Dismiss (ECF No. 6) is GRANTED.

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IT IS FURTHER ORDERED that the Clerk shall enter judgment and close the case.

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Dated this 29th day of June, 2016.
Dated this 23rd day of June, 2016.

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_____________________________________
ROBERT C. JONES
United States District Judge

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