Timmy Jones v. United States , 727 F.3d 844 ( 2013 )

United States Court of Appeals
For the Eighth Circuit
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No. 12-3275
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Timmy Jones
lllllllllllllllllllll Plaintiff - Appellant
v.
United States of America
lllllllllllllllllllll Defendant - Appellee
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Appeal from United States District Court
for the Eastern District of Missouri - St. Louis
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Submitted: May 24, 2013
Filed: August 16, 2013
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Before RILEY, Chief Judge, GRUENDER and BENTON, Circuit Judges.
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BENTON, Circuit Judge.
The Department of Veterans Affairs improperly withheld Timmy Jones’s
benefits beginning in 2006. It believed he had an outstanding warrant. Over the next
three years, he tried to get the VA to restore his benefits. In 2012, he sued under the
Federal Tort Claims Act, alleging negligent withholding of benefits. The district
court1 dismissed Jones’s case for lack of subject-matter jurisdiction. Having
jurisdiction under 28 U.S.C. § 1291, this court affirms.
I.
The district court decided this case on a motion for “lack of subject-matter
jurisdiction.” Fed. R. Civ. P. 12(b)(1). Thus, the facts from Jones’s complaint are
accepted as true, viewed most favorably to him. A.J. ex rel. Dixon v. UNUM, 696
F.3d 788, 789 (8th Cir. 2012). The facts are stated according to this standard.
Jones, a disabled veteran, receives compensation benefits from the VA. In
March 2006, it believed Jones had an outstanding felony warrant and was fleeing from
it. See 38 U.S.C. § 5313B; 38 C.F.R. § 3.665(n). In June 2006, the St. Louis VA
office informed Jones he could again receive benefits by supplying evidence that he
was not a fleeing felon. Jones submitted evidence that the warrant was for a
misdemeanor, and had been cleared. In June 2007, the VA regional office ordered
payment of his previously withheld benefits.
After not receiving payments for a few months, Jones returned to the office. He
was told that the compensation would be paid “as soon as some calculations were
made.” Late in 2007, the regional office determined – despite the evidence Jones
already provided – that he owed $35,000 to the VA for overpayment of compensation
and medical care. The VA hired a collection agency to recover these funds, while
withholding his compensation payments until he presented (again) evidence to a
Minnesota office – the office in charge of collecting medical payments.
Jones repeatedly contacted and met with the St. Louis office from June 2007
through August 2008, without success. In March 2008, Jones’s attorney faxed a
1
The Honorable Richard E. Webber, United States District Judge for the Eastern
District of Missouri.
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memorandum to the St. Louis office, detailing the events and demanding payment.2
The VA did not respond to this memorandum. In September 2008, Jones petitioned
the United States Court of Appeals for Veterans Claims for a writ of mandamus. The
court ordered the VA to respond. The VA did so in February 2009, explaining its
determination that Jones was not a fleeing felon and would be refunded the entire
amount of compensation withheld. The VA finally paid Jones five months later.
Even then, it was $16,000 less than he is owed.
Jones filed an administrative claim under the Federal Tort Claims Act, which
VA denied in July 2011. He then sued in district court. Jones does not seek recovery
of any unpaid funds. Rather, he brings a negligence claim under the FTCA alleging
significant damages from the VA’s improper withholding of benefits. The
government moved to dismiss for a lack of subject-matter jurisdiction. The district
court granted its motion. Jones v. United States, 2012 WL 3095544, at *5 (E.D. Mo.
July 30, 2012). Jones appeals.
The government moves this court to dismiss the appeal for lack of subject-
matter jurisdiction, but federal appellate courts have the obligation to satisfy
themselves of their own jurisdiction as well as that of the lower federal court in the
case. Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541 (1986). Because
this court has jurisdiction to determine whether the district court properly dismissed
the case for lack of subject-matter jurisdiction, the government’s motion is denied.
See 28 U.S.C. § 1291.
II.
“The existence of subject-matter jurisdiction is a question of law that this court
reviews de novo.” ABF Freight Sys., Inc. v. Int’l Bhd. of Teamsters, 645 F.3d 954,
2
The date on the fax cover sheet reads “March 20, 2007,” but its text shows it
was actually sent on March 20, 2008.
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958 (8th Cir. 2011). The party seeking to invoke federal jurisdiction – here, Jones –
carries the burden, which may not be shifted to another party. Great Rivers Habitat
Alliance v. FEMA, 615 F.3d 985, 988 (8th Cir. 2010). Because the government limits
its jurisdictional attack to Jones’s complaint, this is a facial challenge to subject-matter
jurisdiction. BP Chems. Ltd. v. Jiangsu Sopo Corp., 285 F.3d 677, 680 (8th Cir.
2002). Therefore, “the court restricts itself to the face of the pleadings, and the
non-moving party receives the same protections as it would defending against a
motion brought under Rule 12(b)(6).” Osborn v. United States, 918 F.2d 724, 729 n.6
(8th Cir. 1990) (citations omitted).
The FTCA provides:
Subject to the provisions of chapter 171 of this title, the district
courts . . . shall have exclusive jurisdiction of civil actions on claims
against the United States, for money damages, accruing on and after
January 1, 1945, 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)(1). This jurisdiction is augmented by the Veterans’ Judicial
Review Act of 1988, which provides:
The Secretary [of VA] shall decide all questions of law and fact
necessary to a decision by the Secretary under a law that affects the
provision of benefits by the Secretary to veterans or the dependents or
survivors of veterans. Subject to subsection (b), the decision of the
Secretary as to any such question shall be final and conclusive and may
not be reviewed by any other official or by any court, whether by an
action in the nature of mandamus or otherwise.
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38 U.S.C. § 511(a).3 Thus, the district court does not have jurisdiction over a benefits
claim once the Secretary decides under a law affecting benefits. See Broudy v.
Mather, 460 F.3d 106, 112-15 (D.C. Cir. 2006) (explaining that § 511(a) does not
provide exclusive jurisdiction to the VA on laws affecting the provision of veterans
benefits, but does prevent district courts from reviewing the VA’s decision once
made). The issue here is whether this case involves a benefits claim that deprives the
district court of jurisdiction.
This court has relied on § 511(a) to refuse jurisdiction of a First Amendment
challenge to the denial of benefits. Hicks v. Veterans Admin., 961 F.2d 1367, 1370
(8th Cir. 1992). The veteran argued that in retaliation for complaining about the VA
care he received, his doctor wrote a letter that resulted in a review of his case, and
eventually, a reduction in benefits. Id. at 1368. The veteran sued in federal district
court, arguing that the retaliation violated his First Amendment rights. Id. This court
found that the district court lacked subject-matter jurisdiction because “Hicks’ claim
that unconstitutional retaliatory conduct was the cause of the reduction of his
disability rating and benefits is essentially a challenge to the reduction of benefits on
a constitutional basis.” Id. at 1370. This court’s analysis thus comports with the
Tenth Circuit’s process to “examine the substance of the[] allegations, rather than the
plaintiff’s labels, to determine their true nature.” Weaver v. United States, 98 F.3d
518, 520 (10th Cir. 1996). This court has also invoked § 511(a) to decline jurisdiction
over a Bivens action, finding an elaborate remedial scheme. Mehrkens v. Blank, 556
F.3d 865, 869-70 (8th Cir. 2009).
The District of Columbia Circuit has evaluated § 511(a) in the FTCA context.
In Price v. United States, 228 F.3d 420 (D.C. Cir. 2000), it held that the district court
3
The claimant then has the right to seek review by the Board of Veterans’
Appeals, 38 U.S.C. § 7104, the Court of Appeals for Veterans Claims, § 7252(a), the
United States Court of Appeals for the Federal Circuit, § 7292, and, ultimately, the
Supreme Court of the United States, § 7291.
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lacked jurisdiction over a veteran’s claim for medical reimbursement “because
underlying the claim is an allegation that the VA unjustifiably denied [the claimant]
a veterans’ benefit.” Price, 228 F.3d at 421. There, the district court liberally
construed the complaint to allege an FTCA tort claim for intentional or negligent
failure to pay medical bills – a tort under Florida law. The D.C. Circuit rejected that
attempt as well:
Nevertheless, assuming Price’s damages claim is cognizable under [the
Florida Statute], a necessary predicate of such a claim is a determination
that the insurer acted in bad faith. Here, the propriety of the VA’s
purported refusal to reimburse Price has not yet been established.
Because a determination whether the VA acted in bad faith or with
negligence would require the district court to determine first whether the
VA acted properly in handling Price’s request for reimbursement,
judicial review is foreclosed by 38 U.S.C. § 511(a).
Id. at 422 (citation omitted).
Similarly here, Jones sued the VA for negligently failing to pay him benefits.
Resolving that would require the district court to determine whether the VA acted
negligently in the benefits determinations. Thus, the district court lacks jurisdiction.
Jones argues that his claim is completely independent of the benefits decision because
he is suing for other damages – not for the benefits themselves. Not so. The
dichotomy between related and independent claims is discussed in Thomas v. Principi,
394 F.3d 970 (D.C. Cir. 2005). There, the D.C. Circuit evaluated claims arising from
the VA’s delay in disclosing a veteran’s diagnosis of schizophrenia. Thomas, 394
F.3d at 972. Three claims were allowed to proceed – intentional infliction of
emotional distress and two medical-malpractice claims – because they arose from the
failure to disclose the diagnosis, and not from the failure to pay benefits:
Because none of these claims alleges that the VA failed to pay for
treatment (or even to provide for treatment), they raise no “questions of
law [or] fact necessary to a decision by the Secretary under a law that
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affects the provision of benefits.” 38 U.S.C. § 511. The raised
“questions of law and fact” relate to whether the alleged withholding of
the diagnosis states a tort claim, and resolution of those questions is not
“necessary” to the benefits determination. See id. Putting the issue in
Price’s terms, no denial of benefits “underl[ies]” Thomas’s
failure-to-inform allegations. See 228 F.3d at 421.
Id. at 974-75 (alteration in original). Conversely, the court concluded that the district
court lacked jurisdiction over other claims that the VA “failed to render the
appropriate medical care services” and that the VA’s “continuous and persistent
deprivation and denial of known needed and necessary medical care treatment . . .
caused Plaintiff severe emotional distress.” Id. at 975 (alteration in original). The
court rejected these claims “[b]ecause adjudicating these allegations . . . would require
the district court ‘to determine first whether the VA acted properly’ in providing
Thomas benefits.” Id., quoting Price, 228 F.3d at 422; see also Veterans for
Common Sense v. Shinseki, 678 F.3d 1013, 1025 (9th Cir. 2012) (“[Section] 511
precludes jurisdiction over a claim if it requires the district court to review ‘VA
decisions that relate to benefits decisions,’ Beamon v. Brown, 125 F.3d 965, 971 (6th
Cir. 1997), including ‘any decision made by the Secretary in the course of making
benefits determinations,’ Broudy, 460 F.3d at 115.”).
Jones’s claims are like the claims rejected in Thomas. Specifically, the
allegation there that the denial of treatment caused severe emotional distress mirrors
the claims here – that the denial of benefits caused Jones’s damages. Jones argues
that Thomas (and Weaver) is distinguishable because it challenges a discretionary
benefits decision as opposed to Jones’s characterization of his case as challenging a
“mandatory pay obligation.” The discretionary–mandatory distinction is not relevant
for the § 511(a) analysis; all that matters is “whether adjudicating [Jones’s] claims
would require the district court ‘to determine first whether the VA acted properly in
handling’ [Jones’s] benefits request.” Thomas, 394 F.3d at 974, quoting Price, 228
F.3d at 422. Jones claims he is not challenging the benefits decision, but only the
failure to pay. Looking through his label of the allegation, however, this court finds
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that the substance of Jones’s allegation is the VA’s “handling . . . [of the] benefits
request.” Id.Jones emphasizes that his case does not involve a benefits determination,
relying primarily on Roman Cancel v. United States, 598 F. Supp. 2d 227 (D.P.R.
2008). There, the claimants brought a FTCA claim alleging that the VA’s negligent
reduction of benefits caused mental suffering and property loss. The court ruled that
it would not have to evaluate whether the VA acted properly in reducing the benefits:
“Indeed, the VA has already decided that it acted improperly in handling Cortes’s
benefits; it held that the benefits reduction contained a [clear and unmistakable error
(CUE)] and, accordingly, that the VA did not properly handle Cortes’s benefits.”
Roman Cancel, 598 F. Supp. 2d at 232.4
This court need not address the Roman Cancel court’s holding that a CUE
finding means that the VA’s benefits decision will not have to be evaluated in an
FTCA negligence claim. A CUE determination is specific to the VA and defined by
regulation. See 38 C.F.R. § 20.1403; see also 38 U.S.C. § 5109A. Its interaction with
a common-law negligence claim is a question for another case. Jones specifically
states in his complaint that he “has not yet filed for the balance due based on Clear and
4
In his brief, Jones extensively discusses the discretionary-function exception
to FTCA suits. See 28 U.S.C. § 2680(a). This discussion is misplaced because the
government need not rely on the discretionary-function exception to avoid suit.
Rather, the key is that § 511(a) strips the district court of subject-matter jurisdiction.
Jones also argues that language from Thomas actually supports his position. He
misreads Thomas. It does not discuss the discretionary-function exception.
Finally, Jones asserts that in Roman Cancel “there is an inference this
[discretionary-function] analysis is required in FTCA cases.” Not so. There, the court
discussed it because the government “argue[d] that the FTCA’s discretionary function
exception deprive[d] th[e] court of subject matter jurisdiction.” Roman Cancel, 598
F. Supp. 2d at 229. Section 511(a) is an independent jurisdictional argument, which
resolves this case.
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Unmistakable error in the determination of the amount actually due Plaintiff . . . .”
There has been no CUE determination for any of the VA’s acts. Jones argues a CUE
finding is not necessary because the VA has admitted that it wrongly denied him
benefits. That admission, however, is far from a finding that the VA was negligent
(legally speaking) in doing so. The district court would have to determine whether,
based on the information it had at the time, the VA was negligent in not paying
benefits. This court need not address the merits of that question, but because the
district court would have to answer it, § 511(a) precludes jurisdiction.5 Finally, Jones
contends that there were no decisions in this case to challenge, only “mistakes.” That
is wrong. The VA made the decision not to pay Jones – resolving this case requires
the district court to evaluate that decision.
*******
The judgment of the district court is affirmed.
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5
Also of note is the Roman Cancel court’s statement that the “Defendant’s
motion quotes § 511(a) but fails apply [sic] the section to the facts of this particular
case. Defendant makes no effort to explain how adjudicating plaintiffs’ FTCA
damages claims would require the court to answer a question of law or fact related to
Cortes’s benefits determination.” Roman Cancel, 598 F. Supp. 2d at 232. Here, the
government articulates the need for the district court to evaluate the VA’s decision –
specifically, for a finding of negligence.
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