Court Opinion

ID: 2673422
Source: CourtListenerOpinion
Date Created: 2014-05-10 03:14:49.927764+00
Date Added: 2024-06-11T09:19:59.869712
License: Public Domain

In the United States Court of Federal Claims
                                         No. 13-762C
                                  (Filed: February 20, 2014)

                                            )
ROBERT A. GREEN,                            )
                                            )
                     Plaintiff,             )      Motion to Dismiss; Change of Legacy
                                            )      Treasury Direct Account Registration;
v.                                          )      31 C.F.R. § 357.21; 31 C.F.R. §
                                            )      357.42
THE UNITED STATES,                          )
                                            )
                     Defendant.             )
                                            )

       Steven H. Jesser, Skokie, IL, for plaintiff.
       Daniel B. Volk, Commercial Litigation Branch, United States Department of
Justice, Washington, DC, with whom were Lisa Martin, Bureau of the Fiscal Service,
Office of the Chief Counsel, United States Department of the Treasury, Parkersburg,
WV, and Stuart F. Delery, Assistant Attorney General, for defendant.

           ORDER GRANTING DEFENDANT’S MOTION TO DISMISS

       Pending before the court is the motion of defendant, the United States (“the

government”), to dismiss, pursuant to Rule 12(b)(1) or, in the alternative, 12(b)(6) of the

Rules of the United States Court of Federal Claims (“RCFC”), the complaint filed by

plaintiff, Robert A. Green (“Mr. Green”). In his complaint, Mr. Green “claims

entitlement to damages from defendant United States of [America] for funds erroneously,

mistakenly, and negligently paid to another,” by the government from a Legacy Treasury
Direct 1 account (“Legacy Account”) in the United States Treasury (“Treasury”). Comp.

at 1, ECF No. 1. The United States argues that the complaint does not state a plausible

claim against the United States within the Court’s jurisdiction and thus the complaint

should be dismissed. In the alternative, the government argues that, even if this court has

jurisdiction over the claim, the plaintiff cannot state a claim for which relief can be

granted. For the reasons that follow, the court finds that this court does not have

jurisdiction over plaintiff’s claims; thus, the case must be dismissed under RCFC

12(b)(1) because the subject regulations do not provide a right to damages.

I.     BACKGROUND

       According to the complaint, Mr. Green was once named as the sole beneficiary of

the Legacy Account 2 established by his aunt, Ann C. Spiegel. Compl. at ¶ 4.

Apparently, when she first established the account, it was payable on death (“POD”) to

Mr. Green. Id. On August 13, 2008, Ms. Spiegel executed a durable power of attorney

appointing Mark Samuels, who was also her nephew, as her attorney-in-fact. 3 App. to

1
 “The Legacy Treasury Direct system is a non-Internet-based book-entry system maintained by
Treasury for purchasing and holding marketable Treasury securities as book-entry products.” 31
C.F.R. § 357.0(a)(2); see generally TreasuryDirect.gov, Legacy Treasury Direct,
http://www.treasurydirect.gov/indiv/myaccount/myaccount_legacytd.htm (last visited Feb. 20,
2014)
2
 As noted above, Legacy Accounts are maintained by the United States Treasury for purchasing
and holding marketable Treasury securities as book-entry products. 31 C.F.R. § 357.0(a)(2).
3
 The government has provided the court with an appendix containing four documents: (1) Ms.
Spiegel’s power of attorney; (2) the transaction request to change the registration of Ms.
Spiegel’s account; (3) a computer print-out from the Bureau of the Fiscal Service in Parkersburg,
West Virginia at 2:17 p.m. Eastern Time on October 14, 2008; and (4) Ms. Spiegel’s death
certificate.

                                                2
Mot. to Dismiss at 22, ECF No. 5; see Compl. at ¶ 7, 9. Thereafter, on September 25,

2008, an attorney, Howard S. Bornstein, electronically submitted a “Legacy Treasury

Direct Transaction Request” to the Treasury Retail Securities Site on behalf of Ms.

Spiegel requesting a registration change from “Ann C. Spiegel POD Robert Green to Ann

C. Spiegel, Trustee for the Ann C. Spiegel Revocable Trust [“Spiegel Trust”] dated

August 13, 2008.” App. to Mot. to Dismiss at 25-27; see Compl. at ¶ 9. The request was

signed for Ms. Spiegel by Mr. Samuels, her attorney-in-fact. Id. According to the

records from the Bureau of the Fiscal Service in Parkersburg, West Virginia, the Treasury

processed the request and changed the registration on October 14, 2008 at 2:14 p.m.

Eastern Time. App. to Mot. to Dismiss at 28; see Compl. at ¶ 10. Ms. Spiegel died in

Los Angeles County, California on that same date, October 14, 2008, at 3:30 p.m. Eastern

Time. App. to Mot. to Dismiss at 29; see Compl. at ¶ 2.

      According to Mr. Green, Mr. Samuels violated California state law when he

signed and had submitted the forms used to change the registration on Ms. Spiegel’s

Legacy Account. Mr. Green claims that by virtue of the government making the

registration change he was forced to share his inheritance with Mr. Samuels and Barbara

Bautista, who was Ms. Spiegel’s niece and Mr. Samuel’s sister. These two individuals,

along with Mr. Green, were the three beneficiaries of the Spiegel Trust.

      Mr. Green sued Mr. Samuels for tortious inference with an expected inheritance

when he learned in 2010 that the Legacy Account had been originally established on

March 3, 2008 and registered “Ann C. Spiegel POD Robert A. Green.” That lawsuit was

                                            3
settled before this case was filed. The plaintiff claims, however, that he remains

“damaged by more than $375,000.00.”

       In this suit against the United States, Mr. Green alleges that the government

violated his rights to Ms. Spiegel’s Legacy Account by processing the registration change

without confirming that the request complied with California state law and seeks

monetary damages on this basis. The plaintiff also contends that the government’s

actions were negligent because the government failed to investigate Mr. Samuel’s

authority before changing Ms. Spiegel’s account. He further contends that Treasury’s

actions in changing the account upon receiving September 25, 2008 request and without

notice to plaintiff amounted to a violation of his due process rights under the Fifth

Amendment.

II.    DISCUSSION

       It is well-settled that the burden is on the plaintiff to prove jurisdiction by a

preponderance of the evidence. See Reynolds v. Army & Air Force Exch. Serv., 846

F.2d 746, 748 (Fed. Cir. 1988). Ordinarily, undisputed factual allegations contained in

the complaint must be treated as true. See Henke v. United States, 60 F.3d 795, 797

(Fed. Cir. 1995). However, in resolving disputes regarding jurisdictional facts, the court

may look beyond the pleadings. See Rocovich v. United States, 933 F.2d 991, 993 (Fed.

Cir. 1991). If the Court finds that it lacks subject-matter jurisdiction, it must dismiss the

complaint. See Arbaugh v. Y & H Corp., 546 U.S. 500, 514 (2006).

       Under the Tucker Act, this court has “jurisdiction to render judgment upon any

claim against the United States founded either upon the Constitution, or any Act of

                                               4
Congress or any regulation of an executive department, or upon any express or implied

contract with the United States.” 28 U.S.C. § 1491(a) (2012). Mr. Green does not allege

that he had a contract with the United States. Rather, he bases his claim on Treasury

regulations set forth at 31 C.F.R. §§ 357.20 to 357.32, 4 which he alleges were violated in

contravention of California state law when he was removed as the POD beneficiary on

Ms. Spiegel’s Legacy Account. The government argues that this court does not have

jurisdiction over this claim because Mr. Green does not have any right to direct payment

as the sole beneficiary under the above-cited regulations after the transfer of registration

to the Spiegel Trust. Further, the government argues that the United States is immune

from liability, and thus damages, for actions that it takes in making changes to Legacy

Accounts in accordance with transfer requests.

       When a complaint is filed, the court must determine if the regulations which serve

as the basis for the claim are money-mandating. Fisher v. United States, 402 F.3d 1167,

1173 (Fed. Cir. 2005). If the court determines that the source identified is not money-

mandating, the court must dismiss the case. Id. Here, the government argues that Mr.

Green’s complaint must be dismissed because, under the applicable regulations, POD

beneficiaries like Mr. Green do not have any rights “[d]uring an owner’s lifetime [and

that] a transaction request may be executed by the owner without the consent of the

beneficiary.” 31 C.F.R. § 357.21(b)(2)(iii). As such, the government continues, Mr.

Green had no ownership rights as the designated sole beneficiary to Ms. Spiegel’s Legacy

4
 The plaintiff mistakenly identified a different set of regulations in his complaint. He now
agrees that the above-cited regulations are the correct regulations to be applied. See Resp. to
Mot. to Dismiss at ¶ 19.
                                                 5
Account before Ms. Spiegel’s death. Further, the government argues, after the

registration for Ms. Spiegel’s Legacy Account was changed, he no longer had a right to

direct payment as the POD beneficiary. Rather, Mr. Green was only entitled to monies

through the Spiegel Trust.

      The court agrees with the government. The death certificate submitted by the

government establishes that Ms. Spiegel died on October 14, 2008 at 12:30 p.m. Pacific

Time, after the Legacy Account change was made and Mr. Green was removed as the

POD beneficiary. Mr. Green therefore had no right to direct payment by the government

as the POD beneficiary upon Ms. Spiegel’s death. After the registration was changed,

Mr. Green’s right to payment was only from the Spiegel Trust. Indeed, Mr. Green is not

seeking to compel a payment as the POD beneficiary of Ms. Spiegel’s Legacy Account.

Rather, as discussed below, he is challenging the government’s actions in changing Ms.

Spiegel’s Legacy Account registration to the Spiegel Trust.

      With regard to the registration change, the government argues that the case must

be dismissed because there is no right to damages under Treasury regulations for actions

taken by the United States in making changes pursuant to transfer requests. Thus, the

government argues, the United States cannot be sued for allegedly “disregarding

[California] state law in allowing the change of beneficiary,” as Mr. Green contends in

his complaint. Treasury regulations expressly provide that the United States

      may rely on the information provided in a tender, transaction request form,
      or Transfer Message, and [is] not required to verify the information. The
      Department . . . shall not be liable for any action taken in accordance with
      the information set out in a tender, transaction request form, or Transfer
      Message, or evidence submitted in support thereof.

                                            6
31 C.F.R. § 357.42. Because the regulations clearly state that the government cannot be

liable for “any action” taken in accordance with the information it receives in the

transaction request form, the government correctly argues that Mr. Green has not

identified a money mandating source for his claim. Contrary to Mr. Green’s contentions,

there is no exception to the government’s immunity from liability under the regulation

where violations of state law or negligence by Treasury are alleged. The United States

cannot be liable for “any action” it took in accordance with the information it received on

the change form submitted and signed by Mr. Samuels on Ms. Spiegel’s behalf. Because

the government has immunity from liability for actions taken by the Treasury under the

regulations at issue here, Mr. Green has failed to identify a money-mandating source for

his claims. 5

III.   CONCLUSION

       For the foregoing reasons, the Court must dismiss the complaint under RCFC

12(b)(1). The government’s motion to dismiss is therefore GRANTED. The clerk is

directed to enter judgment accordingly. Each party to bear its own costs.

5
  The court notes that Mr. Green also alleges that his “claim is also governed by the Fifth
Amendment to the United States Constitution, which provides in pertinent part that “no person
shall . . . be deprived of life, liberty, or property, without due process of law.” U.S. Const.
amend. V. The portion of the Fifth Amendment that Mr. Green relies upon—the Due Process
Clause—does not give rise to a money-mandating claim. Acadia Tech., Inc. v. United States,
458 F.3d 1327, 1334 (Fed. Cir. 2006) (“A violation of due process rights, however, does not give
rise to a claim for money damages against the United States in the Court of Federal Claims.”).
Similarly, this court does not have jurisdiction over Mr. Green’s claims sounding in tort,
including his claims for “financial negligence.” The Tucker Act excludes from this court’s
jurisdiction claims sounding in tort. 28 U.S.C. § 1491(a); e.g. Sounders v. South Carolina Pub.
Serv. Auth., 497 F.3d 1303, 1307 (Fed. Cir. 2007).

                                               7
IT IS SO ORDERED.

                        s/Nancy B. Firestone
                        NANCY B. FIRESTONE
                        Judge

                    8