Whitaker v. Gates
Filing
227
MEMORANDUM OPINION OF THE COURT. Signed by District Judge Aleta A. Trauger on 11/26/2018. (DOCKET TEXT SUMMARY ONLY-ATTORNEYS MUST OPEN THE PDF AND READ THE ORDER.)(am)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF TENNESSEE
NASHVILLE DIVISION
NANCY WHITAKER,
Plaintiff,
v.
JAMES N. MATTIS, SECRETARY OF
DEFENSE,
Defendant.
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Case No. 3:11-cv-00522
Judge Aleta A. Trauger
MEMORANDUM
Before the court is plaintiff Nancy Whitaker’s Motion to Enforce Settlement Agreement,
Impose Sanctions, and Award Attorneys’ Fees (“Motion to Enforce”). (Doc. No. 220.) Because
the court lacks subject matter jurisdiction to consider it, the motion will be denied.
I.
Factual and Procedural Background
Plaintiff Nancy Whitaker filed suit on June 2, 2011 against the Secretary of the
Department of Defense, in his official capacity, alleging violations of her rights under Title VII
of the Civil Rights Act of 1964 in connection with her employment by the Department of
Defense. On April 10, 2018, the parties reached an agreement to settle all claims involved in the
lawsuit as well as two claims the plaintiff was pursuing separately before the EEOC. (See April
10, 2018 Hr’g Tr., Doc. No. 218, at 5–6.)
The written Settlement Agreement, which the court reviewed at the time the parties
submitted their Agreed Order of Dismissal, required the defendant to pay $30,000 directly to the
plaintiff and an additional $40,000 in attorneys’ fees, for a total settlement amount of $70,000.
(Doc. No. 222, at 14–15.) The Settlement Agreement contemplated that the entire $70,000
payment would be made to the plaintiff’s lead attorney’s trust account and that the lead attorney
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would then make disbursements to the plaintiff and the other attorneys. (See Doc. No. 216, at 6–
7; Doc. No. 222, at 14–16.)
Following the parties’ execution of the Settlement Agreement, the court entered the
parties’ Agreed Order of Dismissal as submitted, adding only a provision requiring each party to
pay its own costs. This Order states, in substantive part: “The parties . . . have informed the court
that all matters between these parties have been settled and compromised. Accordingly, this
action is hereby DISMISSED with prejudice, each party to bear their own costs.” (Doc. No.
217.)
Now pending is the plaintiff’s Motion to Enforce (Doc. No. 220), filed on August 17,
2018. The motion was filed on behalf of the plaintiff by attorneys Daniel L. Graves, II, who
entered an appearance in this case on August 8, 2018, and Amos N. Jones, who has never
formally entered an appearance or sought admission to practice in this court pro hac vice.
Neither Mr. Graves nor Mr. Jones represented the plaintiff in the underlying proceedings. Mr.
Jones was the attorney representing the plaintiff in the EEOC proceedings.
In the Motion to Enforce, the plaintiff argues that the defendant breached the Settlement
Agreement by issuing payment to the plaintiff but then retaining the entirety of that payment.
Besides retaining the $30,000 payment that was to go directly to the plaintiff, the government
retained the $40,000 that was to cover attorneys’ fees. The plaintiff argues that the Settlement
Agreement specifically contemplated that the portion of the settlement payment specifically
designated for payment of attorneys’ fees was supposed to be paid directly to the plaintiff’s lead
attorney’s trust account and not to the plaintiff herself. The plaintiff, through counsel, insists that
the government breached the Settlement Agreement by failing to ensure payment of the
attorneys’ fee directly to counsel for the plaintiff.
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On August 31, 2018, the Secretary filed his Response in Opposition to the Motion to
Enforce. (Doc. No. 226.) The Secretary asserts that he requested payment and that payment in
the amount of $70,000 was issued to the plaintiff from the Judgment Fund in accordance with the
terms of the Settlement Agreement. (Doc. No. 226, at 1.) However, pursuant to 31 U.S.C. §
3716(c)(1)(A), that payment was retained by the Department of Treasury and credited toward a
previously incurred non-tax debt owed by the plaintiff to a different federal agency. (Id. at 1–2.)
Documentation submitted by the plaintiff in support of the Motion to Enforce shows that
counsel for the defendant made a request for payment from the Judgment Fund in accordance
with the Settlement Agreement by mailing to the Department of the Treasury, Bureau of Fiscal
Service, on April 12, 2018, a copy of the Agreed Order of Dismissal, Settlement Agreement and
Release, Judgment Fund Transmittal, Judgment Fund Award Data Sheet, and Judgment Fund
Voucher for Payment in the amount of $70,000. (Doc. No. 222, at 12–22.)
Documentation submitted by the government further shows that the plaintiff was notified
by letter dated February 28, 2017 that she owed the United States government $219,079.43,
because, “on 02/27/2017 the Louisville Fiduciary Hub (LFH) determined that while appointed as
the VA fiduciary for [REDACTED] [the plaintiff] misused $219,079.43 of his VA benefits.”
(Doc. No. 226-2.) The letter explained what steps the plaintiff should take to pay the full amount
owed, to try to settle the debt for a lesser amount, or to set up a payment plan to pay off the debt
over time. (Id.)
In addition, according to the government, the plaintiff was notified by letter dated May
18, 2018 that, although payment of the settlement amount had been approved and released, the
Department of Treasury had retained the payment and applied it to the plaintiff’s pre-existing
non-tax debt to the United States. The letter explained exactly what happened to the payment and
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why. It also described what steps the plaintiff needed to take if she contested the debt or believed
the payment had been applied in error. (Id.)
The plaintiff did not file a reply brief and has not contested, or objected to, any of the
documentation submitted by the government regarding the pre-existing debt to which the
$70,000 settlement amount was applied.
II.
Analysis
A.
The Court’s Power to Enforce Settlement Agreements
Although the district courts have the inherent power to enforce agreements entered into in
settlement of litigation pending before them, Therma-Scan, Inc. v. Thermoscan, Inc., 217 F.3d
414, 419 (6th Cir. 2000), a district court may exercise this power and summarily enforce a
settlement agreement only if it has subject matter jurisdiction over the separate breach-ofcontract controversy surrounding the settlement agreement, Kokkonen v. Guardian Life Ins. Co.
of Am., 511 U.S. 375, 378 (1994), Limbright v. Hofmeister, 566 F.3d 672, 674–75 (6th Cir.
2009).
B.
Lack of Subject Matter Jurisdiction
Although the parties do not address this issue, the first matter to be resolved is whether
the court has subject matter jurisdiction over this controversy. The federal district courts are
courts of limited jurisdiction, constrained to exercise only the authority conferred by Article III
of the United States Constitution and affirmatively granted by federal statute. Kokkonen, 511
U.S. at 377. The court has a duty to consider its subject matter jurisdiction in regard to every
case and may raise the issue sua sponte. Answers in Genesis of Ky., Inc. v. Creation Ministries
Int’l, Ltd., 556 F.3d 459, 465 (6th Cir. 2009); Fed. R. Civ. P. 12(h)(3).
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The Supreme Court’s decision in Kokkonen “provides the analytical framework for
deciding whether a federal court has properly retained jurisdiction over a settlement agreement
and, consequently, over any enforcement issues associated with that agreement.” Moore v. U.S.
Postal Serv., 369 F. App’x 712, 716 (6th Cir. 2010). In Kokkonen, the Court unanimously
recognized that “[e]nforcement of the settlement agreement . . . is more than just a continuation
or renewal of the dismissed suit, and hence requires its own basis for jurisdiction.” 511 U.S. at
378. Thus, the existence of a simple order of dismissal premised upon a settlement agreement,
standing alone, is insufficient to invoke federal supplemental jurisdiction over a contract dispute
over the enforceability of the settlement agreement. See id. (“The suit involves a claim for breach
of a contract, part of the consideration for which was dismissal of an earlier federal suit. No
federal statute makes that connection (if it constitutionally could) the basis for federal-court
jurisdiction over the contract dispute.”). Some other independent basis for jurisdiction must exist,
regardless of whether the enforcement action is before the court as a new, separately filed lawsuit
or a motion to enforce the settlement agreement entered in a previously dismissed case. See id.
(addressing the district court’s jurisdiction over a motion to enforce settlement agreement filed in
the previously dismissed case); see also Limbright, 566 F.3d at 673 (addressing new suit alleging
breach of settlement agreement reached in a previously dismissed lawsuit).
Where, as here, the gravamen of the dispute is breach of contract, state contract law
generally governs the claim, and federal question jurisdiction does not exist under 28 U.S.C. §
1331. See Toledo v. Jackson, 485 F.3d 836, 838 (6th Cir. 2007) (finding that the court did not
have federal question jurisdiction over breach of contract action against the Secretary of the
Department of Housing and Urban Development Diversity). Jurisdiction under § 1332 is another
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possible avenue, Limbright, 566 F.3d at 676, but the amount in controversy here is $70,000, less
than the jurisdictional requirement. Diversity jurisdiction is therefore lacking.
The Supreme Court has also recognized that the district court may retain jurisdiction to
enforce a settlement agreement “if the parties’ obligation to comply with the terms of the
settlement agreement has been made part of the order of dismissal—either by separate provision
(such as a provision ‘retaining jurisdiction’ over the settlement agreement) or by incorporating
the terms of the settlement agreement in the order.” Kokkonen, 511 U.S. at 381; see also Moore
v. U.S. Postal Serv., 369 F. App’x 712, 717 (6th Cir. 2010) (holding that the district court
properly exercised jurisdiction over motion to enforce settlement, because the order of dismissal
expressly included a provision retaining jurisdiction over the settlement agreement). In this case,
however, the Agreed Order of Dismissal submitted by the parties did not incorporate a
requirement that the parties comply with the terms of the Settlement Agreement, nor did it
include language expressly providing for the court’s retention of jurisdiction for the purpose of
enforcing the settlement.
Another statutory provision, 28 U.S.C. § 1361, grants the federal district courts original
jurisdiction over any action “in the nature of mandamus to compel an officer or employee of the
United States or any agency thereof to perform a duty owed to the plaintiff.” However, the
Supreme Court has recognized that “[t]he common-law writ of mandamus, as codified in 28
U.S.C. § 1361, is intended to provide a remedy for a plaintiff only if he has exhausted all other
avenues of relief and only if the defendant owes him a clear nondiscretionary duty.” Heckler v.
Ringer, 466 U.S. 602, 616 (1984). The writ of mandamus is an “extraordinary remedy,” Leisure
v. FBI of Columbus, Ohio, 2 F. App’x 488, 490 (6th Cir. 2001), and the party seeking the writ
has the “the burden of showing that [her] right to issuance of the writ is clear and indisputable.”
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Cheney v. U.S. Dist. Court for D.C., 542 U.S. 367, 381 (2004) (internal quotation marks and
citations omitted).
Section 1361 does not apply here, for several reasons. First, the plaintiff has not invoked
§ 1361 and makes no effort to establish a clear and undisputable right to the issuance of a writ.
And second, an action under § 1361 must be brought against a federal official in his individual
capacity and not against the office. Blaney v. U.S., 34 F.3d 509, 513–14 (7th Cir. 1994) (citing
Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 687–88 (1949)). If, as is the case
here, “a plaintiff seeks to compel an officer to perform a contractual duty not dictated by the
terms of his authority under either the Constitution or a federal statute or regulation, it is not a
suit against the officer in his personal capacity to perform his duties under the law, but rather a
suit against his office.” Id. at 514. An attempt to enforce a settlement agreement via the
mandamus statute would, therefore, “amount[] to a suit for specific performance against the
United States,” to which § 1361 mandamus jurisdiction does not extend. Id. (citation omitted);
see also Bobula v. U.S. Dep’t of Justice, 970 F.2d 854, 860 (Fed. Cir. 1992) (holding that
Ҥ 1361 cannot provide jurisdiction where the duty alleged is merely a contractual duty
unsupported by the Constitution, a statute, or a regulation”).
Moreover, although Congress has waived sovereign immunity in Title VII cases in which
the federal government is the employer, 42 U.S.C. § 2000e–16(d), this statutory waiver does not
expressly extend to monetary claims against the federal government for breach of a settlement
agreement that resolves a Title VII dispute. Frahm v. United States, 492 F.3d 258, 262 (4th Cir.
2007). Although the defendant in this case may have waived the defense of sovereign immunity
by failing to raise it in response to the plaintiff’s Motion to Enforce, an additional basis for
concluding that § 1361 would not apply in this situation is that a claim against Secretary Mattis
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in his official capacity as Secretary of Defense is a suit against the sovereign, and § 1361 does
not expressly waive sovereign immunity. See, e.g., Coggeshall Dev. Corp. v. Diamond, 884 F.2d
1, 3 (1st Cir. 1989) (“The provisions of 28 U.S.C. § 1361 creating the federal mandamus action
do not constitute a waiver of sovereign immunity by the United States.” (collecting cases)).
Finally, while the Sixth Circuit does not appear to have addressed the matter specifically,
a majority of circuits considering the question have held that violation of a settlement agreement
sounds in contract and, when the claim is against a federal agency and the amount in controversy
exceeds $10,000, the Court of Federal Claims possesses exclusive jurisdiction over such a claim.
See, e.g., Westover v. United States, 71 Fed. Cl. 635 (Fed.Cl.2006) (“Title VII itself does not
provide a remedy for a breach of contract that occurs incident to settlement of a Title VII claim”
and holding that the Court of Federal Claims possessed jurisdiction); Rochon v. Gonzales, 438
F.3d 1211 (D.C. Cir. 2007) (“[A] claim for breach of a Title VII settlement agreement is a
contract claim within the meaning of the Tucker Act and, therefore, for claims exceeding
$10,000 jurisdiction belongs with the Court of Federal Claims.” (citations and internal quotation
marks omitted)); see also Lindstrom v. United States, 510 F.3d 1191 (10th Cir. 2007) (holding
that the district court lacked subject matter jurisdiction over employee’s actions to enforce
settlement agreement with federal employer); Kielczynski v. Does 1–2, 56 Fed. Appx. 540 (2d
Cir. 2003) (jurisdiction over the plaintiff’s claim against a federal official in his official capacity,
asserting that a federal agency had breached an employment contract, resided exclusively in the
Court of Federal Claims since the amount in controversy exceeded $10,000); Griswold v. Potter,
No. 1:03-CV-429, 2003 WL 23941714, at *6 (W.D. Mich. Oct. 15, 2003) (holding that the
district court lacked jurisdiction over the plaintiffs’ action to enforce settlement agreements
entered in Title VII cases against the Postmaster General in his official capacity and that the
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Court of Federal Claims, instead, had exclusive jurisdiction). In other words, even if § 1361 did
accord jurisdiction, the plaintiff cannot establish that no other avenue of relief is available to her.
III.
Conclusion
In short, the court lacks subject matter jurisdiction to enforce the Settlement Agreement
that resulted in the dismissal of this case. For that reason, the court will deny plaintiff’s Motion
to Enforce. An appropriate Order is filed herewith.
ENTER this 26th day of November 2018.
ALETA A. TRAUGER
United States District Judge
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