24-2666-cv Tanjutco v. NYLife Sec. LLC

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 9th day of December, two thousand twenty-five.

PRESENT: BETH ROBINSON, SARAH A. L. MERRIAM, MARIA ARAÚJO KAHN, Circuit Judges. _____________________________________

Carolina P. Tanjutco,

Petitioner-Appellant,

v. 24-2666

NYLife Securities LLC, Financial Industry Regulatory Authority, New York Life Insurance Company, United States Securities & Exchange Commission,

Respondents-Appellees, Carol Maria Luttati, acting as Chair of Financial Industry Regulatory Authority,

Respondent. _____________________________________

FOR PETITIONER-APPELLANT: Carolina P. Tanjutco, pro se, New York, NY.

FOR RESPONDENTS-APPELLEES Christopher J. Murdoch, NYLIFE SECURITIES LLC AND NEW Emry Murdoch LLC, YORK LIFE INSURANCE COMPANY: Chicago, IL.

FOR RESPONDENT-APPELLEE FINANCIAL William A. Wright, INDUSTRY REGULATORY AUTHORITY: Faegre Drinker Biddle & Reath LLP, Princeton, NJ.

FOR RESPONDENT-APPELLEE UNITED Michael S. Bailey, Trial STATES SECURITIES AND EXCHANGE Attorney, Melinda COMMISSION: Hardy, Assistant General Counsel, Securities and Exchange Commission, Washington, DC.

Appeal from a judgment of the United States District Court for the Southern

District of New York (Moses, M.J.).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED, AND DECREED that the judgment of the district court is

AFFIRMED. 2 Carolina P. Tanjutco, representing herself (pro se), appeals the district court’s

September 11, 2024 judgment dismissing her petition to confirm in part and vacate

in part an arbitral award. Tanjutco filed her original petition against NYLife

Securities LLC, New York Life Insurance Company (together, “New York Life”),

and Carol Maria Luttati, “acting as Chair of Financial Industry Regulatory

Authority.” New York Life App’x at 1. On its own initiative, the district court

dismissed the petition for lack of subject matter jurisdiction but granted leave to

amend. Tanjutco v. NYLife Sec. LLC, No. 23-cv-4889,

, at *3–5

(S.D.N.Y. Jul. 27, 2023). Tanjutco then filed an amended petition against New

York Life, the Financial Industry Regulatory Authority (“FINRA”), and the

Securities and Exchange Commission (“SEC”). The respondents moved to

dismiss or otherwise opposed the petition. The district court dismissed the

petition, concluding that it lacked subject matter jurisdiction over Tanjutco’s

claims against the SEC and New York Life, and that Tanjutco failed to state a claim

against FINRA. Tanjutco v. NYLife Sec. LLC, No. 23-cv-4889,

, at

*9–15 (S.D.N.Y. Sept. 10, 2024).

Where a district court grants a defendant’s Rule 12(b)(1) motion to dismiss,

an appellate court will review the district court’s factual findings for clear error

3 and its legal conclusions without deference. Aurecchione v. Schoolman Transp. Sys.

Inc.,

(2d Cir. 2005). We review a dismissal for failure to state a

claim without deference to the district court. Sharikov v. Philips Med. Sys. MR, Inc.,

(2d Cir. 2024). “A complaint survives a Rule 12(b)(6) motion to

dismiss if the facts, taken as true and with all reasonable inferences drawn in the

plaintiff’s favor, state a plausible claim to relief.”

1 Because Tanjutco “has

been pro se throughout, [her] pleadings and other filings are interpreted to raise

the strongest claims they suggest.”

First, the district court properly dismissed Tanjutco’s claims against the SEC

due to sovereign immunity. It is “ ‘axiomatic’ under the principle of sovereign

immunity ‘that the United States may not be sued without its consent and that the

existence of consent is a prerequisite for jurisdiction.’ ” Adeleke v. United States,

(2d Cir. 2004) (quoting United States v. Mitchell,

(1983)). Because “waivers of sovereign immunity must be unequivocally

expressed in statutory text, and cannot simply be implied,” there must be some

statutory basis from which to conclude that there has been a waiver of sovereign

1In quotations from caselaw and the parties’ briefing, this summary order omits all internal quotation marks, footnotes, and citations, and accepts all alterations, unless otherwise noted. 4 immunity for a court to have jurisdiction. Binder & Binder, P.C. v. Colvin,

(2d Cir. 2016).

Here, Tanjutco asserted that her “right to federal due process [was] violated

when the [SEC] authorized [FINRA] to enter disclosure reports in associated

person’s Central Records Depositary (or CRD) submitted by financial institutions,

available to public disclosure through FINRA/Brokercheck.” FINRA App’x at

298. Tanjutco generally sought damages, and to the extent that Tanjutco sought

those damages from the SEC based on alleged constitutional due process

violations, the SEC was entitled to sovereign immunity. Tanjutco did not identify

any provision waiving sovereign immunity and empowering the district court to

hear her due process claim against the SEC, and none is apparent. See Adeleke,

355 F.3d at 151–52. And Tanjutco has not otherwise alleged that the SEC was

involved in the underlying arbitration and provides no other basis for a claim

against the SEC. As a result, the district court lacked subject matter jurisdiction

to entertain Tanjutco’s claims against the SEC.

Second, the district court properly dismissed Tanjutco’s claims against

FINRA. “[A]rbitrators in contractually agreed upon arbitration proceedings are

absolutely immune from liability in damages for all acts within the scope of the

5 arbitral process,” and this immunity extends to the “sponsoring organization.”

Austern v. Chicago Bd. Options Exchange, Inc.,

(2d Cir. 1990). To

the extent that Tanjutco’s claims against FINRA were related to the underlying

arbitration, the claims were therefore barred by arbitral immunity. And to the

extent that Tanjutco sought damages from FINRA for its operation of the

BrokerCheck disclosure system and the alleged “defamatory disclosures placed

on her record,” FINRA App’x at 298, “[t]here is no question that [a self-regulatory

organization] and its officers are entitled to absolute immunity from private

damages suits in connection with the discharge of their regulatory

responsibilities,” Standard Inv. Chartered, Inc. v. Nat’l Ass’n of Sec. Dealers, Inc.,

(2d Cir. 2011); see also Cohen v. UBS Fin. Servs., Inc.,

(2d Cir. 2015) (“FINRA is a self-regulatory organization.”).

Finally, the district court properly dismissed Tanjutco’s claims against New

York Life for lack of subject matter jurisdiction. “[U]nder Sections 9 and 10 [of

the FAA], a party may apply to the court to confirm, or alternatively to vacate, an

arbitral award.” Badgerow v. Walters,

(2022). However, the FAA’s

“authorization of a petition does not itself create jurisdiction,” and a federal court

must have “an independent jurisdictional basis to resolve the matter.”

6 In considering whether a Section 9 or 10 petition presents an independent

jurisdictional basis, the court cannot “look through” the application to the

underlying substantive dispute.

. “Rather, a jurisdictional basis

independent of the FAA must appear on the face of the application itself.”

Trustees of N.Y. State Nurses Ass’n Pension Plan v. White Oak Glob. Advisors, LLC,

, 584 (2d Cir. 2024). As a result, Tanjutco cannot rely solely on the

Federal Arbitration Act to establish federal jurisdiction and must demonstrate an

independent basis for jurisdiction: either diversity or a federal question.

No jurisdictional basis independent of the FAA was apparent on the face of

Tanjutco’s petition. Tanjutco invoked constitutional rights and asserted that the

action concerned interstate commerce, but Tanjutco did not allege that New York

Life, a private entity, was “acting under color of state law,” a requirement to bring

a constitutional claim. See McGugan v. Aldana-Bernier,

(2d Cir.

2014). There is thus no basis for federal question jurisdiction because there is no

cognizable federal claim. See City of New York v. Exxon Mobil Corp.,

,

41 (2d Cir. 2025) (“[F]ederal question jurisdiction generally exists only when a

federal question is presented on the face of the plaintiff’s properly pleaded

complaint”).

7 Nor did Tanjutco establish diversity jurisdiction. Diversity jurisdiction

requires the suit to be between “citizens of different States” or “citizens of a State

and citizens or subjects of a foreign state.”

. “For diversity

purposes, a corporation is considered a citizen of the state in which it is

incorporated and the state of its principal place of business,” and a limited liability

company “takes the citizenship of each of its members.” Bayerische Landesbank,

N.Y. Branch v. Aladdin Cap. Mgm’t LLC,

, 48–49 (2d Cir. 2012). Here,

New York Life was a citizen of New York. And Tanjutco claimed that she was

either a resident of New York or a dual American citizen living abroad in the

Philippines.

In either event, diversity jurisdiction was not established. “United States

citizens domiciled abroad are neither citizens of any state of the United States nor

citizens or subjects of a foreign state,” with the consequence that “§ 1332(a) does

not provide that the courts have jurisdiction over a suit to which such persons are

parties.” Herrick Co. v. SCS Communications, Inc.,

, 322 (2d Cir. 2001).

So if Tanjutco was a dual citizen living abroad, there is no diversity. But if she

was a New York resident, then there was not complete diversity given New York

8 Life’s own New York citizenship. Either way, there is no basis for diversity

jurisdiction.

Accordingly, we AFFIRM the judgment of the district court.

FOR THE COURT: Catherine O’Hagan Wolfe, Clerk of Court

9