Michael Sammons v. United States , 860 F.3d 296 ( 2017 )

Case: 17-50201 Document: 00514039218 Page: 1 Date Filed: 06/19/2017
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
No. 17-50201 FILED
Summary Calendar June 19, 2017
Lyle W. Cayce
Clerk
MICHAEL SAMMONS,
Plaintiff–Appellant,
versus
UNITED STATES OF AMERICA,
Defendant–Appellee.
Appeal from the United States District Court
for the Western District of Texas
Before JOLLY, SMITH, and GRAVES, Circuit Judges.
JERRY E. SMITH, Circuit Judge:
Michael Sammons, proceeding pro se, brought a takings claim against
the United States. The district court concluded that, under the Tucker Act,
Sammons must pursue his claim in the Court of Federal Claims (“CFC”), so it
dismissed for want of subject-matter jurisdiction. Sammons contends that the
Tucker Act is unconstitutional because it requires him to litigate his claim in
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No. 17-50201
an Article I court. We affirm.
I.
Congress created the Federal National Mortgage Association (“Fannie
Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) to
provide, among other things, liquidity to the residential mortgage market.
During the financial crisis of 2008, the two entities faced a sharp reduction in
the value of their assets and a loss of investor confidence. In response, Con-
gress passed the Housing and Economic Recovery Act of 2008, which created
the Federal Housing Finance Agency (“FHFA”) and empowered it to act as
conservator of Fannie Mae and Freddie Mac. Shortly after the FHFA placed
the enterprises into conservatorship, the Treasury Department purchased
$1 billion of preferred stock in each entity. That “Senior Preferred Stock”
enjoyed preference as to all other preferred stock and was entitled to an annual
cumulative dividend equal to ten percent of the money given to the enterprises
from the Treasury. In 2012, the FHFA and the Treasury amended the stock-
purchase agreement to change the dividend to one hundred percent of the
current and future profits of the enterprises.
Sammons holds $1 million in noncumulative preferred shares in Fannie
Mae and Freddie Mac, and he contends that the 2012 amendment permanently
deprived him of the economic value of his preferred shares. He thus asserts
that the amendment amounted to a regulatory taking and that he is entitled
to $900,000 in just compensation.
The government moved to dismiss for lack of subject-matter jurisdiction
under Federal Rule of Civil Procedure 12(b)(1) because the Tucker Act vests
exclusive jurisdiction for takings claims over $10,000 in the CFC. 28 U.S.C.
§ 1491(a)(1). Sammons moved for a declaratory judgment that the Tucker Act
is unconstitutional as applied to his claim. The court rejected Sammons’s
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constitutional challenge and dismissed for lack of jurisdiction. We review
de novo a Rule 12(b)(1) dismissal for lack of jurisdiction. 1
II.
The Tucker Act provides that “[t]he United States Court of Federal
Claims shall have jurisdiction to render judgment upon any claim against the
United States founded either upon the Constitution, or any Act of Congress or
any regulation of an executive department, or upon any express or implied
contract with the United States, or for liquidated or unliquidated damages in
cases not sounding in tort.” 28 U.S.C. § 1491(a)(1). It does not “create sub-
stantive rights, but [is] simply [a] jurisdictional provision[] that operate[s] to
waive sovereign immunity for claims premised on other sources of law”. 2
Under the Tucker Act, the CFC has exclusive jurisdiction over claims
against the United States for more than $10,000. 3 Sammons concedes that,
because he seeks more than that, the district court had no statutory juris-
diction. He attempts to get around that by attacking the Tucker Act, theorizing
that it violates Article III by vesting the power to hear constitutional takings
claims in the CFC, an Article I court.
There are several classes of cases that Congress can permissibly assign
to non-Article III courts. 4 One includes cases involving “public rights, which
1 JTB Tools & Oilfield Servs., L.L.C. v. United States, 831 F.3d 597, 599 (5th
Cir. 2016).
2United States v. Bormes, 133 S. Ct. 12, 17 (2012) (quotation marks omitted and alter-
ation adopted).
3Chichakli v. Szubin, 546 F.3d 315, 317 (5th Cir. 2008); 28 U.S.C. § 1491(a)(1). If the
claim is for $10,000 or less, the Little Tucker Act vests the CFC and district courts with
concurrent jurisdiction. Bd. of Governors of Fed. Reserve Sys. v. DLG Fin. Corp., 29 F.3d 993,
999 n.18 (5th Cir. 1994); 28 U.S.C. § 1346(a)(2).
4 See N. Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U.S. 50, 64–70 (1982)
(plurality opinion) (describing the categories of cases).
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may be presented in such form that the judicial power is capable of acting on
them, and which are susceptible of judicial determination, but which congress
may or may not bring within the cognizance of the courts of the United States,
as it may deem proper.” 5 One way a right can be “public” is if it is asserted
against the United States in its sovereign capacity, such that the government
has immunity. 6 In such circumstances, “Congress may set the terms of adjudi-
cating a suit when the suit could not otherwise proceed at all.” Stern, 564 U.S.
at 489.
The dispute thus reduces to whether the United States, in the absence
of the Tucker Act, has sovereign immunity over takings claims. If it does, then
Congress can attach conditions to its Tucker-Act waiver, such as requiring
claimants to litigate in the CFC. The government maintains that before Con-
gress passed the Tucker Act in 1887, it had not waived sovereign immunity
over takings claims. The government observes that, before then, citizens had
to request individual waivers of sovereign immunity through private bills in
Congress. 7 Sammons counters that the Fifth Amendment automatically
waives sovereign immunity. He principally relies on Supreme Court precedent
describing the “self-executing” nature of the takings clause. 8
But whatever the merits of the parties’ positions, the issue is foreclosed.
Stern v. Marshall, 564 U.S. 462, 489–90 (2011) (quoting Murray’s Lessee v. Hoboken
5
Land & Imp. Co., 59 U.S. 272, 284 (1855)).
6Id. at 489; N. Pipeline, 458 U.S. at 67 (plurality opinion); Ex parte Bakelite Corp.,
279 U.S. 438, 452 (1929).
7 See Library of Cong. v. Shaw, 478 U.S. 310 n.3 (1986); Langford v. United States,
101 U.S. 341, 343 (1879) (“It is to be regretted that Congress has made no provision by any
general law for ascertaining and paying . . . just compensation.”).
8 See, e.g., First English Evangelical Lutheran Church of Glendale v. Los Angeles Cty.,
482 U.S. 304, 314–16 (1987) (“We have recognized that a landowner is entitled to bring an
action in inverse condemnation as a result of the self-executing character of the constitutional
provision with respect to compensation . . . ”) (quotation marks omitted).
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“It is well-established in this circuit that one panel of this Court may not over-
rule another.” United States v. Segura, 747 F.3d 323, 328 (5th Cir. 2014).
Moreover, “[t]he binding force of a prior-panel decision applies not only to the
result but also to those portions of the opinion necessary to that result.” Id.
(quotation marks omitted and alteration adopted).
We have decided, in a way that was necessary to the holding, that the
Fifth Amendment does not automatically waive sovereign immunity. In Ware
v. United States, 626 F.2d 1278, 1279–80 (5th Cir. 1980), the plaintiff brought
a claim against the United States in district court under the Federal Tort
Claims Act and asserted a pendent claim under the Tucker Act. We charac-
terized the Tucker Act claim as a takings claim under the Fifth Amendment.
The plaintiff sought $331,607.89 but contended that the Tucker Act’s $10,000
limitation on district-court jurisdiction applied only to original jurisdiction and
not to pendent claims. Id. at 1286.
We rejected the plaintiff’s position, explaining that “[t]he United States,
as sovereign, is immune from suit except as it waives its immunity, and the
terms of its waiver, as set forth expressly and specifically by Congress, define
the parameters of a federal court’s subject matter jurisdiction to entertain suits
brought against it.” Id. We stated that “[a]ssuming that [the plaintiff] pre-
sent[ed] a valid Fifth Amendment taking claim, the only express waiver of sov-
ereign immunity which vests the district court with jurisdiction over taking
claims against the United States [was the Little Tucker Act] and it limits the
district court jurisdiction to claims involving $10,000 in damages or less.” Id.
(emphasis added). We said that “this court cannot, by using the judge-made
doctrine of pendent jurisdiction waive the immunity of the United States where
Congress, constitutional guardian of this immunity, has declined to do so.” Id.
at 1287 (citation omitted and alteration adopted). “[S]ince the government
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[had] not specifically consented to such a claim,” the district court was
“powerless to entertain the claim.” Id. That holding necessarily assumes that
the Fifth Amendment does not provide a self-executing waiver of sovereign
immunity. We have reached a similar result in other cases. 9
Because, under our binding precedent, the United States’s sovereign
immunity can bar cases against it based on the Takings Clause, those cases
fall into the “public rights” category. See Stern, 564 U.S. at 489. Thus, Con-
gress can constitutionally require such cases to be heard in an Article I court,
as it did in the Tucker Act. Id. So Sammons’s constitutional challenge to the
Tucker Act fails, and the court properly dismissed for want of jurisdiction.
The judgment of dismissal is AFFIRMED.
9 E.g., Wilkerson v. United States, 67 F.3d 112, 119 & n.13 (5th Cir. 1995) (holding
that a district court had no jurisdiction to hear a takings claim because “there [was] no waiver
[of sovereign immunity] except to have the claims heard in the Court of Claims”); United
States v. Land, 213 F.3d 830, 837 (5th Cir. 2000) (holding that landowners could not challenge
certain aspects of a condemnation damages award because, among other reasons, Congress
had not waived sovereign immunity).
6