Lacey v. U.S., 98-1760(PLF).

• Decision Date: 12 November 1999
• Docket Number: No. 98-1760(PLF).,98-1760(PLF).
• Citation: 74 F.Supp.2d 13
• Court: U.S. District Court — District of Columbia
• Parties: Maureen Foley LACEY, et al., Plaintiffs, v. UNITED STATES of America, et al., Defendants.

74 F.Supp.2d 13

Maureen Foley LACEY, et al., Plaintiffs, v. UNITED STATES of America, et al., Defendants.

No. 98-1760(PLF).

United States District Court, District of Columbia.

November 12, 1999.

Neil I. Levy, Emmett H. Miller, III, Kilpatrick Stockton, Washington, DC, for plaintiffs.

Michael C. Johnson, Assistant United States Attorney, Washington, DC, for defendants.

OPINION

PAUL L. FRIEDMAN, District Judge.

This case is before the Court on defendants' motion to dismiss Counts I, II and IV of plaintiffs' amended complaint under Rule 12(b)(1) of the Federal Rules of Civil Procedure for lack of subject matter jurisdiction. The defendants argue that the Court lacks jurisdiction over plaintiffs' Privacy Act claims (Counts I and II) because the statute of limitations has run. See 5 U.S.C. § 552a(g)(5). They also maintain that plaintiffs have not satisfied the statutory exhaustion requirements that are a condition precedent to the filing of a Federal Tort Claims Act complaint in federal court (Count IV). See 28 U.S.C. § 2671 et seq. For the reasons set forth below, defendants' motion will be granted in part and denied in part.

I. FACTS

The plaintiffs, Maureen Foley-Lacey and her husband Stephen C. Lacey, lived in Warren County, New York until 1994. In 1994, the Laceys moved to Clinton County, New York, where Mrs. Lacey applied for Medicaid benefits. Sometime after Clinton County received her application, the County Department of Social Services ("DSS") began an investigation into the Laceys for possible welfare fraud. See Amended Complaint ¶ 8.

Plaintiffs allege that Henry Yelle of the DSS used contacts within the United States Customs Service, namely his wife, to seek the assistance of the Immigration and Naturalization Service in his investigation of the Laceys.¹ Mr. Yelle allegedly requested "private and personal information concerning [the Laceys]" from an INS agent. See Amended Complaint ¶ 8. The INS agent, with the assistance of a supervisor, then began gathering information and documents on the Laceys from INS records and from contacts within the Royal Canadian Mounted Police ("RCMP"). Id. After conducting their search, the INS officials allegedly disclosed the information and documents to Mr. Yelle and provided the information to the RCMP. See Amended Complaint ¶¶ 11, 12.

The Laceys were unaware of the passing of information between the INS, RCMP and the Clinton County DSS. The Laceys allege that as a result of the DSS investigation and the information generated by it, they were indicted for welfare fraud and arrested. See Amended Complaint ¶ 14. They were released pending trial and, for reasons that are not entirely clear from the record, they moved to Canada in October 1995. The Laceys did, however, make their whereabouts known to prosecuting officials in December 1995. See Amended Complaint ¶ 16. The current status of the criminal case is unclear from the record.

On May 3, 1996, the Laceys filed a complaint with the Office of the Privacy Commissioner of Canada ("OPCC") questioning whether any Canadian government institutions had disclosed personal information to the Clinton County DSS. On the same day, the Laceys filed a written complaint with the INS Office of Internal Audit regarding conduct by officials of the United States government. See Amended Complaint ¶ 18.² On May 6, 1996, the Laceys wrote another letter to the INS supplementing the complaint of May 3, 1996. This letter was followed up by a telephone conversation with Special Agent Kay Kramer in which the Laceys told Agent Kramer that they might file a lawsuit against the United States for monetary damages and injunctive relief in the event the government could not retrieve the wrongfully disclosed records.³ On two separate occasions, Agent Kramer advised the Laceys not to sue because they lacked evidence; she allegedly also told them that waiting would allow the INS to investigate the claim. See Pls' Opp., Att. 1 (Declaration of Maureen Foley-Lacey ¶¶ 12, 13). The Laceys maintain that they relied on Agent Kramer's advice and awaited the INS report. See Pls' Opp. at 8.

On June 11, 1996, the Laceys had a conversation with an officer of the OPCC who "informed plaintiffs that Mr. Yelle had admitted using his connection in the INS ... to get any and all information to use against the plaintiffs." Amended Complaint ¶ 17. The Laceys informed Agent Kramer of this conversation and had several other conversations with her over the course of the following year, including a February 1997 conversation in which Agent Kramer informed plaintiffs that United States Customs "had completed its investigation and would soon be forwarding its findings to Ms. Kramer." Pls' Opp. at 6 and Att. 1 (Declaration of Maureen Foley-Lacey ¶ 14).

During a telephone conversation in late April 1997, Agent Kramer informed the Laceys that INS agents in fact had committed some of the illegal actions that the Laceys alleged. See Pls' Opp., Att. 1 (Declaration of Maureen Foley-Lacey ¶ 14). This conversation was followed by a letter dated May 5, 1997 from Stephen W. Schenk, Assistant Director of the Internal Investigation Branch of the INS. See Pls' Opp., Exh. C (letter from Stephen Schenk). The letter confirmed that the Laceys' claim had been substantiated and that corrective actions would be taken, but the letter did not specify what actions would be taken or who would take those actions. See id.

On June 9, 1997, plaintiffs filed a Freedom of Information Act request with the INS, and the INS released some information in response. On July 15, 1998, plaintiffs filed their complaint in this case pro se. The Court subsequently appointed counsel for plaintiffs, and on March 15, 1999, plaintiffs filed an amended complaint naming the United States, the INS, and two John Does as defendants.

II. DISCUSSION

As in any dispute, the facts as presented by the parties differ in some respects, but for the purposes of this motion to dismiss, plaintiffs' allegations must be accepted as true and all reasonable inferences must be drawn in their favor. See, e.g., Stokes v. United States Postal Service, 937 F.Supp. 11, 13-14 (D.D.C.1996). The Court has considered material outside the pleadings because this is a motion to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. See Haase v. Sessions, 835 F.2d 902, 906 (D.C.Cir.1987); Cobell v. Babbitt, 30 F.Supp.2d 24, 47 n. 28 (D.D.C. 1998).

A. Privacy Act Claims

The defendants moved to dismiss plaintiffs' Privacy Act claims on the ground that the two year statute of limitations governing such claims expired before plaintiffs filed suit. See 5 U.S.C. § 552a(g)(5). If plaintiffs have failed to satisfy the statute of limitations provision of the Privacy Act, the Court lacks subject matter jurisdiction over these claims. See Szymanski v. United States Parole Comm'n, 870 F.Supp. 377 (D.D.C.1994) (citing Diliberti v. United States, 817 F.2d 1259 (7th Cir. 1987)).

The Privacy Act provides, in relevant part:

An action to enforce any liability created under this section may be brought ... within two years from the date on which the cause of action arises, except that where an agency has materially and willfully misrepresented any information required under this section to be disclosed to an individual and the information so misrepresented is material to [sic] establishment of the liability of the agency ... the action may be brought at any time within two years after discovery by the individual of the misrepresentation.

5 U.S.C. § 552a(g)(5). Because of this statutory provision, plaintiffs were required either to bring this action within two years of the date on which they knew or should have known of the alleged violation, or to establish that they filed suit within two years of discovering a material and willful misrepresentation by defendants. See Tijerina v. Walters, 821 F.2d 789, 798 (D.C.Cir.1987); Marin v. United States Dep't of Defense, Civil Action No. 95-2175, 1998 WL 779101 (D.D.C.); Pope v. Bond, 641 F.Supp. 489, 500 (D.D.C. 1986). The plaintiffs filed this action on July 15, 1998.

In their amended complaint, plaintiffs state that "on or about June 11, 1996, an officer of the OP[C]C orally informed plaintiffs that Mr. Yelle had admitted using his connection in the INS to get in touch with the Canadians to use the CPIC system to get any and all information to use against the plaintiffs." Amended Complaint ¶ 17. The conversation with the officer at the OPCC on June 11, 1996, normally would constitute sufficient notice to plaintiffs that the INS may have committed a violation of their privacy rights, thereby triggering the two-year statute of limitations provision of the Privacy Act. See Diliberti v. United States, 817 F.2d at 1263 (unsubstantiated hearsay and rumors sufficient to trigger the statute of limitations). Without more, the Court would find that the statute of limitations ran on June 11, 1998, 34 days before plaintiffs filed their original complaint.

In their opposition to defendants' motion, however, plaintiffs allege that over the course of the period of time during which plaintiffs and Agent Kramer were in contact — from June 11, 1996, when plaintiffs spoke with the OPCC, through May 5, 1997, when they finally received confirmation that their claim had been substantiated — Agent Kramer repeatedly advised plaintiffs not to sue. Agent Kramer told them that they lacked evidence to bring a suit, and that they should wait for the INS to finish its own investigation before bringing suit. See Pls' Opp., Att. 1 (Declaration of Maureen Foley-Lacey ¶¶ 10-13). It was not until the end of April 1997 that Agent Kramer informed plaintiffs that their claim had been substantiated and that a letter to that effect would be coming soon from the INS. Approximately a week later, on May 5, 1997, the INS sent plaintiffs a letter stating that the investigation had substantiated pl...