Casa De Cambio Comdiv S.A., De C.V. v. U.S.

• Decision Date: 29 May 2002
• Docket Number: No. 01-5042.,01-5042.
• Citation: 291 F.3d 1356
• Parties: CASA DE CAMBIO COMDIV S.A., DE C.V., Plaintiff-Appellant, v. UNITED STATES, Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1356

291 F.3d 1356

CASA DE CAMBIO COMDIV S.A., DE C.V., Plaintiff-Appellant, v. UNITED STATES, Defendant-Appellee.

No. 01-5042.

United States Court of Appeals, Federal Circuit.

May 29, 2002.

Robert Ehrenbard Kelley Drye & Warren LLP, of Washington, DC, argued for plaintiff-appellant. On the brief was Thomas C. Jackson.

Doris S. Finnerman, Attorney, Commercial Litigation Branch, Civil Division, Department of Justice, of Washington, DC, argued for defendant-appellee. With her in the brief were Stuart E. Schiffer, Acting Assistant Attorney General; David M. Cohen, Director; and Mark A. Melnick, Assistant Director. Of counsel on the brief were Rhonda Kent, and Tricia Long, Attorneys, Office of Chief Counsel, Financial Management Service, Department of the Treasury, of Washington, DC.

Before CLEVENGER, Circuit Judge, ARCHER, Senior Circuit Judge, and DYK, Circuit Judge.

DYK, Circuit Judge.

Casa de Cambio Comdiv S.A. de C.V. ("Casa") appeals from an order of the Court of Federal Claims dismissing Casa's complaint. Casa de Cambio Comdiv S.A. de C.V. v. United States, 48 Fed. Cl. 137 (2000). Casa cashed a stolen United States Treasury check and deposited the check in its account with non-party Norwest Bank Minnesota, N.A. ("Norwest"), which, in turn, presented the check for payment by the Treasury. The Treasury, after discovering that the check was stolen, recouped the amount by debiting Norwest's account, after which Norwest debited Casa's account with Norwest. Casa's complaint alleged that the government illegally exacted money from Casa in violation of federal regulations. Casa's complaint also alleged the government's action amounted to a taking and violation of the Due Process clause of the Fifth Amendment. Because the Court of Federal Claims properly dismissed the complaint, we affirm.

BACKGROUND

Casa's complaint is based on the following factual allegations.

Casa is engaged in the business of international currency exchange, has its principal place of business in Mexico City, and is incorporated in Mexico. On October 29, 1993, Genaro Alvarez ("Alvarez") presented to Casa a check drawn on the United States Treasury in the amount of $1,165,000. The check was made out to Alvarez as the payee. Unbeknownst to Casa the check had been stolen. Apparently the check listed no payee at the time it was stolen, and Alvarez's name was later filled in. Casa gave value for the check and forwarded it to Norwest, Casa's banker in the United States, for deposit and collection. On November 1, 1993, Norwest forwarded the check to the Federal Reserve Bank of Minnesota for collection. On November 4, 1993, the Federal Reserve Bank debited the Treasury account and gave immediate credit for the check to Norwest. There is no allegation that the drawer's signature was forged.

On November 17, 1993, the Treasury was informed that a number of checks had been stolen from the United States Postal Data Service Center in St. Louis, Missouri, including a check bearing the same serial number as the check cashed by Alvarez. However, it was not until February 1, 1994, that the Treasury directed the Federal Reserve Bank to credit the full amount of the check to its account, acting pursuant to 31 C.F.R. 240.3(c), which provides: "The Treasury shall have the usual right of a drawee to examine checks presented for payment and refuse payment of any checks. The Treasury shall have a reasonable time to make such examination." 31 C.F.R. § 240.3(c) (2001). The Federal Reserve Bank did so on that same day and debited Norwest's account with the Federal Reserve Bank for the full amount of the check. Norwest then debited the full amount of the check from Casa's account with Norwest. Norwest's debiting of Casa's account caused Casa's account to be overdrawn by $659,665.63 on February 2, 1994.

On October 29, 1999, Casa filed suit against the United States in the Court of Federal Claims. Casa sought to recover on three separate theories. Count I alleged that the government did not reject payment on the check within a "reasonable time," in violation of 31 C.F.R. § 240.3(c), (d). Count II alleged an illegal exaction without due process in violation of the Fifth Amendment. Count III alleged the government had taken Casa's property without just compensation as guaranteed by the Fifth Amendment. Casa sought to recover damages for the value of the check, the loss of use of funds, expenses incurred due to the overdraft in Casa's account with Norwest, legal fees and expenses, and the diminished value of its business due to a decline in Casa's reputation as a result of its overdrawn account with Norwest.

In a well-reasoned opinion the Court of Federal Claims dismissed count I for lack of jurisdiction holding that, even if the government had violated 31 C.F.R. Part 240, those regulations were "directed only at protecting the Treasury's rights, rather than those of third parties.... [and] nothing in the language of the regulation[s] unequivocally grants a depositor in [Casa's] position a right to recover damages either `expressly or by implication.'" Casa, 48 Fed. Cl. at 141 (internal citations omitted). The court dismissed count II (the Due Process claim) for failure to state a claim because the government had not required Casa to pay any money either to the government or to a third party. "Rather, [the funds] were recouped by a third party, Norwest, pursuant to its deposit contract with [Casa]." Id. at 144. The Court of Federal Claims similarly dismissed count III (the Takings claim) for lack of jurisdiction because "[i]t was Norwest and not the United States that took the action that resulted in the diminishment of [Casa's] funds and the involvement of the United States in that transaction was not `sufficiently direct and substantial' to make the United States liable for a taking of those funds." Id. at 142-43 (quoting Nat'l Bd. of YMCA v. United States, 395 U.S. 85, 93, 89 S.Ct. 1511, 23 L.Ed.2d 117 (1969) ("YMCA")).

Casa filed this timely appeal. We have jurisdiction pursuant to 28 U.S.C § 1295(a)(3).

DISCUSSION

I

This court reviews decisions of the Court of Federal Claims involving questions of jurisdiction and the failure to state a claim upon which relief can be granted without deference. Kanemoto v. Reno, 41 F.3d 641, 643 (Fed.Cir.1994); Shelden v. United States, 7 F.3d 1022, 1026 (Fed.Cir. 1993). We review the Court of Federal Claims's interpretation of the constitution, statutes, and regulations without deference. City of Tacoma v. Richardson, 163 F.3d 1337, 1339 (Fed.Cir.1998).

II

Initially, it is useful to place the appellant's claims in context. Disputes concerning the legal rules governing the present fact situation or similar situations are not uncommon. Indeed, though one would not know it from the briefs, a similar factual situation led to the leading Supreme Court decision on federal common law Clearfield Trust Co. v. United States, 318 U.S. 363, 63 S.Ct. 573, 87 L.Ed. 838 (1943). Typically, where a check has been stolen and the payee's endorsement has been added or forged, the dispute is between the Treasury and the bank that presented the check for payment. In Clearfield Trust, a Treasury check with a forged payee endorsement was tendered to the J.C. Penney Co. ("J.C.Penney") by someone who was not the payee of the check. 310 U.S. at 364, 60 S.Ct. 968. J.C. Penney cashed the check and endorsed it over to Clearfield Trust, which paid J.C. Penney. Id. at 365, 60 S.Ct. 968. Clearfield Trust then presented the check to the Federal Reserve Bank of Philadelphia, which paid Clearfield Trust. Id. Twelve days later the payee told the United States that he had never received the check. Id. The United States then informed Clearfield Trust and J.C. Penney of the forgery and, sixteen months after the check was cashed, informed Clearfield Trust that it sought reimbursement for the amount of the check. Id. The United States subsequently brought suit against Clearfield Trust to reclaim the amount of the check. Id. Clearfield defended on the ground that the United States had unreasonably delayed in seeking to recoup the amount of the check. Id. at 366, 60 S.Ct. 968. The Supreme Court held that the rights and obligations between Clearfield and the United States were to be determined under federal common law because they related to commercial paper issued by the United States. Id.

On the merits in Clearfield Trust, the Supreme Court held that the government was not liable to Clearfield Trust because Clearfield Trust could "shift that loss to the drawee [the Treasury] only on a clear showing that the drawee's delay in notifying [it] of the forgery caused [it] damage." Id. at 370, 63 S.Ct. 573. The Supreme Court concluded that such damage had not been shown by Clearfield Trust, "who so far as appears can still recover from J.C. Penney Co." Id. The Court distinguished Price v. Neal, 3 Burr. 1354, 97 Eng. Rep. 871 (1762) as involving the situation of a forgery of the drawer's signature, in which the drawee is charged with immediate knowledge of the forgery, while Clearfield Trust involved the situation of a forgery of the payee's signature, knowledge of which the drawee could not be immediately charged. Id. at 369, 63 S.Ct. 573. Thirteen years later, when addressing a related factual situation involving a dispute between private parties, the Supreme Court clarified that the rights and obligations between the private parties (e.g., J.C. Penney and Clearfield Trust, or Casa and Norwest) are generally determined under state law because they do "not touch the rights and duties of the United States." Bank of Am. Nat'l Trust & Sav. Ass'n v. Parnell, 352 U.S. 29, 33, 77 S.Ct. 119, 1 L.Ed.2d 93 (1956).

Although Clearfield Trust was a case in which the United States brought suit against the presenting bank, it is indeed difficult to believe that, where a debit has occurred, making affirmative legal action by the United States unnecessary, the presenting bank...