Morgan v. United States Department of Education
| Decision Date | 31 March 2022 |
| Docket Number | Case No. 1:20-cv-709 |
| Citation | 596 F.Supp.3d 1023 |
| Parties | Devin MORGAN, Plaintiff, v. UNITED STATES DEPARTMENT OF EDUCATION, Defendant. |
| Court | U.S. District Court — Southern District of Ohio |
Richard P. Gabelman, Cincinnati, OH, for Plaintiff.
William Bryan King, II, Cincinnati, OH, for Defendant.
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION
This civil case is before the Court on a motion to dismiss (Doc. 15) filed by Defendant United States Department of Education ("the Department"), and the parties’ responsive memoranda (Docs. 17, 18). The motion seeks to dismiss the remaining counts of Plaintiff Devin Morgan's ("Plaintiff's") complaint (Doc. 1) on grounds that the Court lack subject matter jurisdiction or, in the alternative, that the complaint fails to state a claim on which relief can be granted.
Plaintiff is federal student loan borrower who successfully repaid his loans. On February 6, 2020, however, Plaintiff noticed that his Equifax credit report still showed the Department of Education was reporting a monthly payment of $226.00. Plaintiff refers to this as the "Errant Tradeline." He wrote a letter to Equifax disputing the Errant Tradeline on April 16, 2020. Equifax, in turn, forwarded it to the Department. By June 1, 2020, the Errant Tradeline had not been corrected and still appeared on his credit report. Plaintiff alleges damages based on the emotional toll of this error and the effect the error had on his credit worthiness. He brings claims for (I) negligent violation of the fair credit reporting act under 15 U.S.C. § 1681o against the Department for failing to conduct a proper investigation under 15 U.S.C. § 1681s-2(b), and (II) willful violation of the fair credit reporting act against the Department under § 1681n on the same facts as Count I. Plaintiff brought two identical claims against Equifax which he has now settled; Equifax has been dismissed from this case. (Doc. 20).
The Department now seeks to dismiss the remaining claims by motion under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction, or 12(b)(6) for failure to state a claim. Because the Court grants the Department's 12(b)(1) motion, it need not address the 12(b)(6) motion to dismiss for failure to state a claim.
On a 12(b)(1) motion, the plaintiff has the burden of proving jurisdiction. Moir v. Greater Cleveland Regional Transit Auth. , 895 F.2d 266, 269 (6th Cir. 1990). "A court lacking jurisdiction cannot render judgment but must dismiss the cause at any stage of the proceedings in which it becomes apparent that jurisdiction is lacking." Basso v. Utah Power & Light Co. , 495 F.2d 906, 909 (10th Cir. 1974). Motions to dismiss for lack of subject-matter jurisdiction fall into two general categories: facial attacks and factual attacks. United States v. Ritchie , 15 F.3d 592, 598 (6th Cir. 1994). In a factual attack, the Court must weigh the "evidence [before it] to arrive at the factual predicate that subject matter jurisdiction exists or does not exist." Ohio Nat'l Life Ins. Co. v. United States , 922 F.2d 320, 325 (6th Cir. 1990). A facial attack goes to whether the plaintiff has properly alleged a basis for jurisdiction, and the trial court takes the allegations of the complaint as true. Id. The Department here does not contest the facts in the complaint and therefore brings a facial attack. Ball by Burba v. Kasich , 244 F. Supp. 3d 662, 672 (S.D. Ohio 2017). In deciding the merits of a facial attack under 12(b)(1), "the court must take the material allegations of the petition as true and construed in the light most favorable to the nonmoving party." United States v. Ritchie , 15 F.3d 592, 598 (6th Cir. 1994). Thus, a facial attack on the pleading under Rule 12(b)(1) mirrors the standard of review on a motion brought under Rule 12(b)(6). Ball by Burba , 244 F. Supp. 3d at 672.
Absent a waiver, sovereign immunity shields the federal government, its agencies, and employees from suit. F.D.I.C. v. Meyer , 510 U.S. 471, 475, 114 S.Ct. 996, 127 L.Ed.2d 308 (1994) (citing Loeffler v. Frank , 486 U.S. 549, 554, 108 S.Ct. 1965, 100 L.Ed.2d 549 (1988) ; Federal Housing Administration v. Burr , 309 U.S. 242, 244, 60 S.Ct. 488, 84 L.Ed. 724 (1940) ); see also United States v. Mitchell , 463 U.S. 206, 212, 103 S.Ct. 2961, 77 L.Ed.2d 580 (1983) (). "Federal courts are courts of limited jurisdiction" that "possess only that power authorized by Constitution and statute." Kokkonen v. Guardian Life Ins. Co. of Am. , 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). Thus, "[a] waiver of the Federal Government's sovereign immunity must be unequivocally expressed in statutory text, and will not be implied." Lane v. Pena , 518 U.S. 187, 192, 116 S.Ct. 2092, 135 L.Ed.2d 486 (1996). "To sustain a claim that the Government is liable for awards of monetary damages, the waiver of sovereign immunity must extend unambiguously to such monetary claims." Id. "Moreover, a waiver of the Government's sovereign immunity will be strictly construed, in terms of its scope, in favor of the sovereign." Id.
Where a statute is unclear, courts must "construe ambiguities in favor of immunity." Id. The burden of establishing a waiver of sovereign immunity "rests upon the party asserting jurisdiction." Kokkonen , 511 U.S. at 377, 114 S.Ct. 1673.
In this case, Plaintiff has not met his burden of establishing that the Fair Credit Reporting Act ("FCRA") waives sovereign immunity against an action for damages under the remedial provisions of §§ 1681n and 1681o.
When FCRA was enacted, it defined "person" to include "government or governmental subdivision or agency." See Pub.L. 90-321, Title VI, § 602, Oct. 26, 1970; 15 U.S.C. § 1681a(b). This meant the federal government was subject to the same restrictions on permissible uses of credit reports as any other person. At that time, enforcement provisions were only available to address violations by consumer reporting agencies. Id. Thus, at the FCRA's inception, there was no argument that it waived sovereign immunity for monetary damages against the federal government.
In 1996, Congress passed the Consumer Credit Reporting Reform Act. The Act broadened FCRA's enforcement provisions to address violations by "any person" not just consumer reporting agencies. See 15 U.S.C. §§ 1681n and 1681o. The definition of "person" in 15 U.S.C. § 1681a(b), however, continued to include the word "government." Courts have long grappled with whether this was merely inartful drafting or leaving "government" in the definition of "person" was Congress unequivocally waiving sovereign immunity for monetary damages against the federal government.1
Neither the Supreme Court nor the Sixth Circuit have yet addressed this question. The four circuit courts that have addressed it are evenly split. Compare Robinson v. U.S. Dep't of Educ. , 917 F.3d 799 (4th Cir. 2019) () and Daniel v. Nat'l Park Serv. , 891 F.3d 762 (9th Cir. 2018) (same) with Bormes v. United States , 759 F.3d 793 (7th Cir. 2014) ( it has) and Mowrer v. United States Dep't of Transportation , 14 F.4th 723 (D.C. Cir. 2021) (same).2
Having reviewed these cases, the statute, its legislative history, relevant Sixth Circuit case law, and the parties’ arguments, this Court agrees with the Department (and the Fourth and Ninth Circuits). Congress did not unambiguously and unequivocally waive the federal government's sovereign immunity when it expanded FCRA enforcement "any person" without changing the statute's existing definition of "person."
In arriving at this conclusion, the Court views the FCRA in its entirety. See Richards v. United States , 369 U.S. 1, 11, 82 S.Ct. 585, 7 L.Ed.2d 492 (1962) (). Though courts normally assume that identical words used in different parts of the same act are intended to have the same meaning, "this is merely a general assumption, and is not always valid or applicable." Greenbaum v. Environ. Prot. Agency , 370 F.3d 527, 537 (6th Cir. 2004). "[I]n common usage, the term ‘person’ does not include the sovereign, and statutes employing the word are ordinarily construed to exclude it." Int'l Primate Prot. League v. Administrators of Tulane Educ. Fund , 500 U.S. 72, 82–83, 111 S.Ct. 1700, 114 L.Ed.2d 134 (1991). Indeed, the Supreme Court is "especially reluctant to read ‘person’ to mean the sovereign where ... such a reading is ‘decidedly awkward.’ " Id. at 83, 111 S.Ct. 1700.
Often, the "meaning—or ambiguity—of certain words or phrases may only become evident when placed in context." Food & Drug Admin. v. Brown & Williamson Tobacco Corp. , 529 U.S. 120, 132, 120 S.Ct. 1291, 146 L.Ed.2d 121 (2000). Thus, "[t]he court must look beyond the language of the statute ... when the text is ambiguous or when, although the statute is facially clear, a literal interpretation would lead to internal inconsistencies, an absurd result, or an interpretation inconsistent with the intent of Congress ." Vergos v. Gregg's Enterprises, Inc. , 159 F.3d 989, 990 (6th Cir. 1998) ; see also Appleton v. First Nat. Bank of Ohio , 62 F.3d 791, 801 (6th Cir. 1995) (...
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