Clark v. Us On Behalf Of USDA
Clark v. Us On Behalf Of USDA
Opinion of the Court
This case is before the Court on Defendant United States of America, on behalf of the United States Department of Agriculture, Rural Housing Service ("USDA")'s Motion to Dismiss, [Doc. No. 45], Defendant John Robinson's Motion to Dismiss or in the Alternative, Motion to Stay the Proceedings, [Doc. No. 68], and Defendant Ann L. Mell's Motion to Dismiss, [Doc. No. 81].
Facts and Background
On March 1, 2018, plaintiff Vance Clark ("Plaintiff"), acting pro se, filed this lawsuit in the St. Francois County, Missouri, Circuit Court against the United States of America (the "United States") concerning a property Plaintiff purchased in 2009 using a loan from the United States Department of Agriculture, ("USDA"). The United States, on behalf of the USDA ("Defendant") subsequently removed this case to federal court pursuant to
In November 2009, Plaintiff purchased property located at 3416 Hildebrecht Road, Doe Run, Missouri 63637 (the "Hildebrecht Property"). To finance the purchase, Plaintiff sought and obtained a $ 122,000 loan from the USDA. Plaintiff executed a Deed of Trust in favor of the USDA, which the USDA recorded with the St. Francois County Recorder of Deeds at Document No. 2009R-10926, and re-recorded at Document 2010R-00327.
As a condition of the loan, Plaintiff was required to obtain property insurance. Plaintiff applied for and received a homeowner's insurance policy from Farm Bureau Town and Country Company of Missouri (hereinafter, "Farm Bureau"). In September 2010, the Hildebrecht Property suffered damage from fire. Plaintiff submitted a claim to Farm Bureau, which denied coverage.
On December 28, 2010, Farm Bureau filed a lawsuit in Missouri state court naming Plaintiff and the USDA. See Mo. Case No. 10SF-CC00289 (St. Francois County) (the "Farm Bureau Lawsuit"). Farm Bureau alleged that on the application for insurance, Plaintiff concealed the fact that he had prior felony convictions. Farm Bureau alleged that the USDA, as the mortgagee on the Hildebrecht Property, was "subject to the same terms, exclusions, and conditions that apply to the named insured." The United States counter-claimed, alleging Farm Bureau owed the United States for the property loss under the homeowner's policy because the United States was the mortgagee on the property.
Farm Bureau and the USDA settled the claims between them, whereby Farm Bureau agreed to pay the USDA an undisclosed amount of money. On February 21, *10872014, the USDA and Farm Bureau agreed to a voluntary dismiss the USDA from the Farm Bureau Lawsuit.
The USDA applied the settlement proceeds to the outstanding balance of Plaintiff's loan, although the settlement was insufficient to satisfy the outstanding principal balance. Farm Bureau is still prosecuting the Farm Bureau Lawsuit against Plaintiff in the state court.
Plaintiff stopped making payments to the USDA on the remaining balance of the $ 122,000 loan. On February 21, 2012, the USDA sent via certified mail an acceleration letter pursuant to the promissory note signed by Plaintiff, demanding full payment of the outstanding loan balance and accrued interest. When Plaintiff failed to comply, the USDA contacted the caretaker of Plaintiff's property, notifying him that the USDA intended to foreclose on Plaintiff's property.
On April 30, 2018, the Substitute Trustee under the Deed of Trust conducted a foreclosure sale of the Hildebrecht Property. The foreclosure sale netted a total of eleven thousand dollars ($ 11,000.00) in proceeds. Because the foreclosure sale did not satisfy the outstanding principal balance on the loan, there were no excess proceeds to remit to Plaintiff.
On August 22, 2018, Plaintiff filed a motion for leave to file a fourth amended petition. Plaintiff filed his fourth amended petition on August 27, 2018. In the fourth amended petition, Plaintiff names Defendants United States, John Robinson, and Ann L. Mell.
Plaintiff raises five counts in his fourth amended petition. In Counts I and II, Plaintiff requests a declaratory judgment interpreting provisions of the homeowner's contract between Plaintiff and the Farm Bureau, and alleges the USDA breached the terms of that contract. Count III alleges the USDA wrongfully seized $ 1,240.00 of Plaintiff's tax refund, and alleges that Plaintiff sustained injury when the United States removed his state court litigation to this Court. Plaintiff demands the United States pay him damages because the United States removed this case to federal court.
In Count IV, Plaintiff once again alleges that the United States breached the terms of his homeowner's insurance policy. He further alleges that the defendants "had a meeting of minds in circumventing Plaintiff's rights," when it removed this case to federal court prior to him having a hearing before the state-court judge. Plaintiff further alleges that the foreclosure of his property was wrongful and fraudulent. In Count V, Plaintiff alleges that the United States and the individual defendants engaged in a "conspiracy" causing Plaintiff damages.
Defendant USDA moves to dismiss for lack of subject matter jurisdiction. Defendant Mell moves to dismiss for lack of subject matter jurisdiction and for failure to state a claim. Defendant Robinson moves to dismiss or alternatively stay this proceeding pursuant to the Colorado River Doctrine.
Legal Standards
Subject Matter Jurisdiction
"In order to properly dismiss for lack of subject matter jurisdiction under Rule 12(b)(1), the complaint must be successfully challenged on its face or on the factual truthfulness of its averments." Titus v. Sullivan ,
"Jurisdictional issues, whether they involve questions of law or of fact, are for the court to decide."
In "a factual attack on the jurisdictional allegations of the complaint, the court may receive competent evidence such as affidavits, deposition testimony, and the like in order to determine the factual dispute."
Sovereign Immunity
"Absent a waiver, sovereign immunity shields the Federal Government and its agencies from suit." FDIC v. Meyer ,
"A waiver of the Federal Government's sovereign immunity must be unequivocally expressed in statutory text and will not be implied." Lane v. Pena ,
Failure to State a Claim- Fed. R. Civ. P. 12(b)(6)
A 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). To satisfy this requirement, a plaintiff must plead "enough facts to state a claim to relief that is plausible on its face." Corrado v. Life Inv'rs Ins. Co. of Am. ,
On a motion to dismiss, courts must rule "on the assumption that all the allegations in the complaint are true," and "a well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and 'that a recovery is very remote and unlikely.' " Twombly ,
To survive a Rule 12(b)(6) motion to dismiss, a complaint must set forth a short and plain statement of the claim showing that the pleader is entitled to relief. Fed. R. Civ. P. 8(a)(2). This standard does not require detailed factual allegations, but it demands more than an unadorned accusation. Iqbal ,
Colorado River Doctrine
Federal courts ordinarily have a "virtually unflagging obligation" to exercise their jurisdiction. Colo. River Water Cons. Dist. v. United States ,
*1090The Eighth Circuit has instructed that the "key consideration for the district court is 'to ascertain whether the issues in controversy between the parties to the federal action ... can be better settled by the state court' in light of the 'scope and nature of the pending state court proceeding.' " Evanston Ins. Co. v. Johns ,
The Colorado River abstention doctrine permits federal district courts to decline to exercise jurisdiction only "when [1] parallel state and federal actions exist and [2] exceptional circumstances warrant abstention." Fru-Con Constr. Corp. v. Controlled Air, Inc. ,
Because federal courts have a "virtually unflagging obligation ... to exercise the jurisdiction given them," the Colorado River abstention is appropriate only in "exceptional circumstances" where the surrender of federal jurisdiction is supported by "the clearest of justifications." Moses H. Cone Mem'l Hosp. v. Mercury Const. Corp. ,
Where parallel state and federal proceedings exist, the court examines the following six, non-exhaustive factors to determine whether exceptional circumstances are present that warrant abstention:
(1) whether there is a res over which one court has established jurisdiction; (2) the inconvenience of the federal forum; (3) whether maintaining separate actions may result in piecemeal litigation, unless the relevant law would require piecemeal litigation and the federal court issue is easily severed; (4) which case has priority-not necessarily which case was filed first but a greater emphasis on the relative progress made in the cases; (5) whether state or federal law controls, especially favoring the exercise of jurisdiction where federal law controls; and (6) the adequacy of the state forum to protect the federal plaintiff's rights.
Federated Rural Elec. Ins. Corp. v. Ark. Elec. Coops, Inc. ,
Discussion
Discussion Defendant USDA and Defendant Mell in her Official Capacity
Defendants USDA and Mell in her official capacity are protected by sovereign immunity. Plaintiff has failed to identify any applicable statute in which the USDA has waived sovereign immunity for the USDA and Defendant Mell in her official capacity. See, e.g., *1091Kriegel v. U.S. Dept. of Agric. , No. 2:17-CV-00216-D-BP,
Defendant USDA and the claims against Defendant Mell in her official capacity, are dismissed from this action.
Defendant Mell in her Individual Capacity
In Bivens , the Supreme Court created an implied cause of action based on a Fourth Amendment violation. Bivens v. Six Unknown Named Agents of Fed. Bureau of Narcotics ,
In Ziglar , the Court was faced with claims from detainees held on immigration violations after the September 11, 2001 terrorist attacks. Plaintiffs' suit challenged the official policies resulting in their detention and the conditions of confinement they endured while detained.
It held that federal courts should exercise caution before extending the remedy to claims that are meaningfully different than "the three Bivens claims the Court has approved in the past: a claim against FBI agents for handcuffing a man in his own home without a warrant [ Bivens ]; a claim against a Congressman for firing his female secretary [ Davis ]; and a claim against prison officials for failure to treat an inmate's asthma [ Carlson ]."
The recognition of a cause of action is context-specific, and the Court has established a rigorous inquiry that courts must use before implying a Bivens cause of action in a new context. See Wilkie v. Robbins ,
A case might differ in a meaningful way because of the rank of the officers involved; the constitutional right at issue; the generality or specificity of the official action; the extent of judicial guidance as to how an officer should respond to the problem or emergency to be confronted;
*1092the statutory or other legal mandate under which the officer was operating; the risk of disruptive intrusion by the Judiciary into the functioning of other branches; or the presence of potential factors that previous Bivens cases did not consider.
Defendant Robinson
Defendant Robinson moves to dismiss this action against him based on the Colorado River Doctrine. Based on the factors delineated by the Eighth Circuit Court of Appeals, the Court agrees. The Circuit Court of St. Francois County, Missouri has established jurisdiction over the issues raised herein in the case filed by Farm Bureau against Plaintiff and the USDA, Plaintiff has answered in that matter and has filed counterclaims, and has brought a claim against Defendant Robinson in that action. Factor one favors abstention.
The property is located in St. Francois County, the foreclosure occurred in St. Francois County, and the insurance policy was applied for and issued in St. Francois County. This federal forum is clearly less convenient that the State Forum. Factor two favors abstention.
Abstention is favored under Factor three. All of the parties are present in the State action, whereas Farm Bureau is not present in this Court, and its presence may be necessary for a full determination of the issues raised. Likewise, having both actions proceed may result in inconsistent judgments. The resulting piecemeal litigation can be avoided by proceeding solely in the State Court.
The State Court case has priority over this action. It has been pending since 2010, with Plaintiff filing his counterclaims in September, 2015. This action was filed in March, 2018, thus pending a far shorter time than the State action; the State action has advanced significantly further that the case has in this forum. Factor four favors abstention.
State law controls the issues in this case completely. There are no federal law issues before either court. Factor five favors abstention.
Likewise, Plaintiff's federal rights are not at issue. All of Plaintiff's claims against *1093Defendant Robinson arise under Missouri law. Factor six favors abstention.
All factors to be considered under the Colorado River Doctrine favor abstention. The most appropriate forum for Plaintiff's claims is the parallel action currently pending in St. Francois County, Missouri. As such, the Court will abstain from exercising jurisdiction over Plaintiff's declaratory judgment action.
Conclusion
Based upon the foregoing analysis, the Motions to Dismiss are well taken. This action will be dismissed.
Accordingly,
IT IS HEREBY ORDERED that Defendant United States of America, on behalf of the United States Department of Agriculture, Rural Housing Service ("USDA")'s Motion to Dismiss, [Doc. No. 45], is GRANTED .
IT IS FURTHER ORDERED that Defendant John Robinson's Motion to Dismiss or in the Alternative, Motion to Stay the Proceedings, [Doc. No. 68], is GRANTED .
IT IS FURTHER ORDERED that Defendant Ann L. Mell's Motion to Dismiss, [Doc. No. 81], is GRANTED .
IT IS FURTHER ORDERED that this matter is DISMISSED .
Plaintiff has filed a number of Motions. In that all Defendants are dismissed from this action, Plaintiff's Motions are rendered moot.
Defendant Mell claims that service on her is ineffective because Plaintiff failed to serve the Attorney General or the United States Attorney for the Eastern District of Missouri as required by Rule 4(i)(3) of the Federal Rules of Civil Procedure. In that Defendant Mell has substantively challenged the adequacy of Plaintiff's claims against her, the Court will not address the service of process issues.
Reference
- Full Case Name
- Vance CLARK v. UNITED STATES of America, ON BEHALF OF the UNITED STATES DEPARTMENT OF AGRICULTURE
- Status
- Published