Reed v. United States

• Decision Date: 28 February 2022
• Docket Number: 3:18-CV-308,3:19-CV-470,3:20-CV-149,3:19-CV-469,3:19-CV-296,3:19-CV-472,3:18-CV-201,3:18-CV-310,3:19-CV-474,3:19-CV-283,3:19-CV-478
• Parties: MICHAEL B. REED, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. BRITTANY N. HYRE ANCULLE, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. BRITTANY ADKINS, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. JAMES CARL VANCE, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. JACKIE SUE BARNES, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. AMERICAN RELIABLE INSURANCE COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. STATE FARM FIRE AND CASUALTY COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. UNITED SERVICES AUTOMOBILE ASSOCIATION, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. AUTO-OWNERS INSURANCE COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. PAUL W. ABBOTT, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.
• Court: U.S. District Court — Eastern District of Tennessee

MICHAEL B. REED, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

BRITTANY N. HYRE ANCULLE, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

BRITTANY ADKINS, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

JAMES CARL VANCE, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

JACKIE SUE BARNES, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

AMERICAN RELIABLE INSURANCE COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

STATE FARM FIRE AND CASUALTY COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

UNITED SERVICES AUTOMOBILE ASSOCIATION, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

AUTO-OWNERS INSURANCE COMPANY, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

PAUL W. ABBOTT, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

Nos. 3:18-CV-201, 3:18-CV-308, 3:18-CV-310, 3:19-CV-283, 3:19-CV-296, 3:19-CV-469, 3:19-CV-470, 3:19-CV-472, 3:19-CV-474, 3:19-CV-478, 3:20-CV-149

United States District Court, E.D. Tennessee, Knoxville

February 28, 2022

MEMORANDUM OPINION AND ORDER

J RONNIE GREER UNITED STATES DISTRICT JUDGE

In 2016, the Chimney Tops 2 Fire ("Fire") left the boundaries of the Great Smoky Mountains National Park. [Doc 1, PagelD 8-9].^[1] The Fire burned surrounding areas and led to loss of life and property damage. After the Fire, numerous individuals ("Individual Plaintiffs") and several insurance companies ("Insurance Plaintiffs" and collectively with Individual Plaintiffs, "Plaintiffs") filed administrative claims with the United States for compensation for damages arising from the Fire. [See, e.g., Doc. 1-3-1-4; Ex. to Notice, Am. Reliable Ins. v. United States, 3:19-CV-469 (E.D. Tenn. Nov. 19, 2019), Doc. 19-1; Ex. to Complaint, Adkins v. United States, 3:18-CV-310 (E.D. Tenn. July 25, 2018), Doc. 1-1]. The Individual Plaintiffs' administrative claims differ from Insurance Plaintiffs' claims. The Insurance Plaintiffs listed, among other claims, "negligently failing to provide timely and accurate notice and warning to Park neighbors, local government officials, local fire departments, local residents and visitors about the status of and imminent danger presented by The Chimney Top 2 Fire." [See, e.g., Ex. to Notice, Am. Reliable Ins., 3:19-CV-469, Doc. 19-1, PagelD 52]. The Individual Plaintiffs did not list a failure to warn in their administrative claims. [See, e.g., Doc. 1-3, PagelD 153].

Eventually, the Individual Plaintiffs and Insurance Plaintiffs sued the United States. [Doc. 1; Doc. 112 (order consolidating cases)]. In their allegations, Plaintiffs allege that the National Park Service ("NPS") failed to monitor the fire, failed to comply with command structure requirements, failed to follow fire management requirements, and failed to warn others about the Fire. [Doc. 1, PagelD 114, 119, 123, 138].^[2] In total, groups of Plaintiffs filed eleven separate lawsuits. [See Doc. 112]. Previously, the United States filed Motions to Dismiss for Lack of Subject Matter Jurisdiction in all of them. [Docs. 23, 49]. After the resolution of those Motions to Dismiss, one claim remains for each of the consolidated cases, the negligent failure-to-warn claim.

Now, the United States has filed two more motions to dismiss. The first motion challenges the Court's jurisdiction for all Plaintiffs. [Doc. 109]. That motion argues that Plaintiffs' failure-to-warn claim falls into the misrepresentation exception to the Federal Tort Claim Act ("FTCA"). [Doc. 109-1, PagelD 3854]. The second motion is only against the Individual Plaintiffs. [Doc. 110]. In it, the United States argues that the individual Plaintiffs failed to satisfy the presentment requirements of the FTC A by failing to include facts and allegations regarding the failure-to-warn claim in their administrative claims. [Doc. 110-1, PagelD 3880].

After the United States filed the motions to dismiss, Plaintiffs filed responses to the Motions. [Docs. 128, 129]. Then, the United States filed replies, [Docs. 141, 142], and the Court heard oral argument, [Doc. 148]. For the reasons stated below, the Court DENIES the Motion to Dismiss regarding the misrepresentation exception and GRANTS the Motion to Dismiss regarding the presentment requirement.

I. FTCA Background and Standard

The FTCA allows lawsuits against the United States:

for injury or loss of property, or personal injury or death caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

28 U.S.C. § 1346(b); Berkovitz by Berkovitz v. United States, 486 U.S. 531, 535 (1988). However, there are "exceptions to this broad waiver of sovereign immunity," Berkovitz, 486 U.S. at 535; see 28 U.S.C. § 2680(h), and a procedural process that plaintiffs must follow when bringing a lawsuit, 28 U.S.C. § 2675(a).

Here, the United States claims that Plaintiffs' failure-to-warn claim falls into one of the exceptions to the United States' waiver of immunity, the misrepresentation exception. [Doc. 110- 1, PagelD 3854]. Title 28 United States Code § 2680(h) makes exceptions for the waiver of immunity, including for "[a]ny claim arising out of. . . misrepresentation . . . ." The United States posits that the Plaintiffs' remaining claim falls into this exception.

Additionally, the United States argues that the Individual Plaintiffs failed to meet all procedural requirements of the FTC A by failing to present and give notice of their failure-to-warn claim. The FTCA requires plaintiffs to "present" any claim to a federal agency before filing a lawsuit against the United States. 28 U.S.C. § 2675(a). While the Individual Plaintiffs filed administrative claims for their losses, the United States argues that the administrative claims did not contain any information regarding the Individual Plaintiffs' failure-to-warn claims and did not give notice to the United States of those claims.

The United States can file a motion to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure to assert its immunity. See A.O. Smith Corp. v. United States, 114 F.3d 359, 361-62 (6th Cir. 2014). A Rule 12(b)(1) motion comes in two forms, a facial or a factual challenge. United States v. Ritchie, 15 F.3d 592, 598 (6th Cir. 1994). The United States brought a facial challenge, which "is a challenge to the sufficiency of the pleading itself." Id. When a challenge is based on the sufficiency of the pleadings, a court accepts the material allegations in the pleadings as true and construes them "in the light most favorable to the nonmoving party." Id. With a facial attack to subject matter jurisdiction, "the plaintiff has the burden of proving jurisdiction in order to survive the motion." RMI Titanium Co. v. Westinghouse Elec. Corp., 78 F.3d 1125, 1134 (6th Cir. 1996) (quoting Rogers v. Stratton Indus., 798 F.2d 913, 915 (6th Cir. 1986)).

II. The misrepresentation exception to the FTCA does not apply in this case because the underlying claim is negligence, not misrepresentation.

As already mentioned, the United States is immune to suits arising from misrepresentation. The misrepresentation exception to the FTCA applies to "claims arising out of negligent, as well as willful, misrepresentation." United States v. Neustadt, 366 U.S. 696, 702 (1961); see Block v. Neal, 460 U.S. 289, 295-96 (1983). The Supreme Court accepted the "legal definition" of misrepresentation as a "duty to use due care in obtaining and communicating information upon which [the plaintiff] may reasonably be expected to rely in the conduct of his economic affairs" Block, 460 U.S. at 295-96; Neustadt, 366 U.S. at 706-07. Congress understood "misrepresentation" to carry this definition when enacting the FTCA. Block, 460 U.S. at 295-96.

The Supreme Court gave guidance for applying this exception. It acknowledged that the United States is immune from "liability for pecuniary injuries which are wholly attributable to reliance on the Government's negligent misstatements." Id. at 297. In a footnote, the Supreme Court adds that some negligence claims involve a misrepresentation, in the dictionary definition sense of the word, and the misrepresentation exception doesn't apply to them. Neustadt, 366 U.S. at 711 n.26. For example, a claim may be "based upon a motor vehicle operator's negligence in giving a misleading turn signal." Id. (quoting William Prosser, Remedies for Misrepresentation Handbook of the Law of Torts 702-03, § 85 (1941)). These claims are really negligence claims, not misrepresentation claims. Id. Further, in the same footnote, the Supreme Court noted that misrepresentation "has been confined 'very largely to the invasion of interests of a financial or commercial character, in the course of business dealings.'" Id. (quoting Prosser, supra, at 702-03, § 85). Similarly, the Supreme Court even reproduced the American Law Institute's Restatement of Torts for the cause of action for negligent misrepresentation, which will be copied later in this opinion. Id. at 706 n.16 (quoting Restatement of Torts § 552 (Am. Law Inst. 1938)).

This language indicates that the misrepresentation exception tends to apply only in the commercial setting involving pecuniary damages. But other statements made by the Supreme Court make the exception less straightforward. The Supreme Court also said, "[T]he essence of an action for misrepresentation whether...