McMasters v. Tennessee Valley Auth.
| Decision Date | 15 February 2012 |
| Docket Number | No.: 3:11-CV-454,: 3:11-CV-454 |
| Parties | GREG McMASTERS, Plaintiff, v. TENNESSEE VALLEY AUTHORITY, Defendant. |
| Court | U.S. District Court — Eastern District of Tennessee |
(VARLAN/SHIRLEY)
This civil action is before the Court on the Motion to Dismiss [Doc. 5], submitted by defendant, the Tennessee Valley Authority ("TVA"), in which TVA moves, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, for dismissal of all claims asserted by plaintiff. Plaintiff, Greg McMasters, has submitted a response in opposition [Doc. 8]. TVA has submitted a reply [Doc. 9]. The motion is ripe for determination. For the reasons set forth herein, TVA's motion to dismiss [Doc. 5] will be GRANTED, plaintiff's claims in this case will be DISMISSED, and this case will be CLOSED.
Plaintiff applied for a position at TVA's Sequoyah Nuclear Plant as an Instrumentation and Controls Systems Engineer, Senior Level (the "position") [Doc. 1, ¶¶ 9, 10, 17, 20]. TVA offered plaintiff the position via a letter dated June 2, 2010 [Id. ¶ 10]. Plaintiff accepted TVA's offer and submitted a notice of resignation to his employer at the time [Id., ¶ 20]. Plaintiff alleges that he was told by a TVA employee that his anticipatedstart date for the TVA position would be November 15, 2010 [Id., ¶ 23]. Plaintiff alleges that beginning at the end of October 2010, and continuing thereafter, he attempted to contact TVA to confirm this start date, but received no response [Id., ¶¶ 24, 25]. On November 22, 2010, TVA sent plaintiff an email rescinding its offer of a position because plaintiff's educational degree did not satisfy the minimal educational requirement for the position [Id., ¶¶ 26, 27; Doc. 1-4].
Plaintiff then filed the instant complaint against TVA, alleging that by rescinding the offer, TVA's actions constituted a breach of contract under Tennessee law [Doc. 1, ¶ 35]. Plaintiff also alleges that he is entitled to damages under a theory of promissory estoppel because he relied, to his detriment, on TVA's promise or representation that it would hire plaintiff to the position [Id., ¶ 44].
TVA brought the instant motion to dismiss.
A party may move to dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure Rule 12(b)(6). In order to survive a Rule 12(b)(6) motion to dismiss for failure to state a claim, a complaint must contain allegations supporting all material elements of the claims. Bishop v. Lucent Techs., Inc., 520 F.3d 516, 519 (6th Cir. 2008). In determining whether to grant a motion to dismiss, all well-pleaded allegations must be taken as true and must be construed most favorably toward the non-movant. Trzebuckowski v. City of Cleveland, 319 F.3d 853, 855 (6th Cir. 2003). Detailed factual allegations are not required, but a party's "obligation to provide the 'grounds' of his 'entitle[ment] to reliefrequires more than labels and conclusions and a formulaic recitation of a cause of action's elements will not do." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). Nor will an "unadorned, the-defendant-unlawfully harmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937 (2009). Rather, a pleading must "contain either direct or inferential allegations respecting all the material elements to sustain a recovery under some viable legal theory." Scheid v. Fanny Farmer Candy Shops, Inc., 859 F.2d 434, 436-37 (6th Cir. 1988) (quoting Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1106 (7th Cir. 1984)).
In support of its motion to dismiss, TVA argues that no breach of contract action can lie against TVA for rescission of an offer of employment because employment at TVA is prescribed by statute and is "by appointment." TVA also argues that an action to recover damages under a theory of promissory estoppel cannot be brought against TVA because employment appointments are made to carry out the business of TVA and are authorized by the TVA Act. In response, plaintiff contends that TVA is not entitled to sovereign immunity by virtue of the "sue and be sued" clause in the TVA Act and because TVA's ability to hire and discharge employees is a commercial function. Plaintiff asserts, therefore, that TVA cannot claim immunity from plaintiff's claims because there is no grave interference with a governmental function in the hiring and discharging of employees.
As noted by both parties, the TVA Act designates TVA "an instrumentality and agency of the Government of the United States[.]" 16 U.S.C. § 831r. The United StatesSupreme Court has recognized TVA's status as a federal agency, see Ashwander v. TVA, 297 U.S. 288, 315 (1936) (), as has the United States Court of Appeals for the Sixth Circuit. See Matheny v. TVA, 557 F.3d 311, 320 (6th Cir. 2009) () (quoting Edwards v. TVA, 255 F.3d 318, 322-23 (6th Cir. 2001) (quoting Hill v. United States, 65 F.3d 1331, 1333 (6th Cir. 1995))). The Sixth Circuit has also recognized that those who work for TVA are employees of the federal government. See Jones v. TVA, 948 F.2d 258, 262 (6th Cir. 1991); see also McNabb v. TVA, 754 F. Supp. 118, 120 (E.D. Tenn. 1990).
This Court recognizes that the "sue and be sued" clause in the TVA Act constitutes a "broad waiver of sovereign immunity" because "in certain limited situations the TVA is exempt from liability arising out of the exercise of wholly governmental functions, where the TVA acts solely as the Government's agent and where the United States itself would not be liable." Edwards, 255 F.3d at 322 (quoting Queen v. TVA, 689 F.2d 80, 86 (6th Cir. 1982), cert. denied, 460 U.S. 1082 (1983)). The Sixth Circuit has also stated that TVA's nonliability is "not an incident of immunity but the result of the entitlement of the TVA, when it acts solely as a governmental entity, to assert as well established substantive principle of nonliability which the Government itself would be entitled to assert and which the Government has not otherwise waved." Queen, 689 F.2d at 86. This exemption from liability for certain "wholly governmental functions" has been analyzed pursuant to the same analysis as that applied to the immunity resulting from the discretionary function doctrine ofthe Federal Tort Claims Act. See, e.g., Edwards, 255 F.3d at 322 (); Sligh v. TVA, 532 F. Supp. 168 (D.C. Tenn. 1980) (same).
The motion to dismiss, however, is not based on principles of federal immunity. Rather, TVA's motion is premised on the statutory basis for the employment of TVA employees and the nature and implication of their status as federal employees.
It is "presumed that 'absent specific legislation, federal employees derive the benefits and emoluments of their positions from appointment rather than from any contractual or quasi-contractual relationship with the government." Piper v. United States, 90 Fed. Cl. 498, 503 (Fed. Cl. 2009) (quoting Chu v. United States, 773 F.2d 1226, 1229 (Fed. Cir. 1985)). Consequently, if an individual's "employment was by 'appointment,' a breach of contract action against the government would be precluded." Hamlet v. United States, 873 F.2d 1414, 1417 n.5 (Fed. Cir. 1989). In other words, a federal employee's "relationship with the Government cannot be simultaneously governed by both an appointment and a contract." Collier v. United States, 56 Fed. Cl. 354, 356 (Fed. Cl. 2003), aff'd, 379 F.3d 1330 (Fed. Cir. 2004). To determine how an individual is employed by the federal government, a court must analyze the relevant statutes and regulations in light of the other evidence presented. Piper, 90 Fed. Cl. at 504.
The TVA Act provides that "[t]he chief executive officer shall appoint, with the advice and consent of the Board, and without regard to the provisions of the civil service laws applicable to officers and employees of the United States, such . . . employees . . . as are necessary for the transaction of the business of the Corporation." 16 U.S.C. § 831b(a).Plaintiff has not alleged that his employment was not by appointment. Thus, absent any other evidence and given the express language of § 831b(a), the Court concludes that TVA's offer of employment to plaintiff arose as an appointment.
In a similar situation, in Piper v. United States, the United States Court of Federal Claims considered a claim for breach of contract made by a plaintiff who was hired by the Transportation Security Administration (the "TSA") and who, after he was hired, claimed that his retirement annuity as a former army officer should not be deducted from his pay. Id., 90 Fed. Cl. at 500. The Court of Federal Claims dismissed the plaintiff's breach of contract claim, holding that the plaintiff's employment was by appointment under the relevant statute and the other evidence, and therefore the plaintiff had no valid contract with the TSA under which he could bring a claim for a breach. Id. at 505-05.1
Similar to Piper, because employment with TVA is by appointment and TVA's relationship with its employees is not governed by contract, plaintiff did not have a contract with TVA from which he can now bring a claim for breach of contract. See, e.g., Chapman v. TVA, No. 2:95-CV-250, slip op. at 3-4 (E. D. Tenn. Oct. 24, 1995) (J. Hull) ( TVA's argument that its employees have no contractual right to employment to be "well-taken"). Accordingly, the Court finds that because plaintiff's offer of a position with TVA was prescribed by statute and was by "appointment" rather than by contract, plaintiff cannot establish one of the essential elements of a breach of contract claim. That is, that a valid contract existed between the parties. See Pryor v. United States, 85 Fed. Cl. 97, 104 (Fed. Cl. 2008) (...
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