WASHINGTON, D.C. - (Mealey's) The Little Tucker Act doesn't waive the U.S. government's sovereign immunity when it comes to damages actions filed under the Fair Credit Reporting Act (FCRA), a unanimous U.S. Supreme Court ruled Nov. 13 (United States of America v. James X. Bormes, No. 11-192, U.S. Sup.).
(Opinion available. Document #43-121116-007Z.)
However, the high court, in vacating and remanding a ruling by the Federal Circuit U.S. Court of Appeals, left the matter of any immunity contained in the FCRA up to the lower court. "Since FCRA is a detailed remedial scheme, only its own text can determine whether the damages liability Congress crafted extends to the Federal Government. To hold otherwise-to permit plaintiffs to remedy the absence of a waiver of sovereign immunity in specific, detailed statutes by pleading general Tucker Act jurisdiction - would transform the sovereign-immunity landscape," Justice Antonin Scalia wrote for the court.
Attorney James Bormes filed a complaint on behalf of one of his clients in the U.S. District Court for the Northern District of Illinois in August 2008. He paid the $350 filing fee using his American Express credit card. The transaction was processed through the federal government's pay.gov system, which dozens of federal agencies use to process online credit card and debit card payment transactions. Bormes claims that both the confirmation on his computer screen and the email confirmation contained the expiration date of his credit card in violation of the FCRA.
Bormes then filed a putative class complaint against the United States in the U.S. District Court for the Northern District of Illinois. The District Court dismissed the suit, explaining that the doctrine of sovereign immunity protects the United States from suit except when Congress has "unequivocally expressed" a waiver of immunity. Bormes appealed to the Federal Circuit U.S. Court of Appeals. His asserted justification for appealing to the Federal Circuit, rather than the regional Seventh Circuit U.S. Court of Appeals, was 28 U.S. Code Section 1295(a)(2).
The Federal Circuit denied the government's motion to transfer. A merits panel of the Federal Circuit subsequently vacated the District Court's decision and reinstated Bormes' FCRA claim. It opined that even if the FCRA did not itself expressly waive the United States' sovereign immunity, the Little Tucker Act and the general Tucker Act could independently supply such a waiver. The United States filed a petition for writ of certiorari on Aug. 12, 2011. The petition was granted Jan. 13.
High Court Briefs
In its April 13 petitioner brief, the United States argued that the Little Tucker Act plays no role in determining whether the United States is liable for damages under the FCRA's general civil remedies provisions.
Bormes argued in his brief that the FCRA falls within the scope of the Little Tucker Act's sovereign immunity waiver.
Vacating the Federal Circuit's decision, the court opined that "[t]he Federal Circuit was . . . wrong to conclude that the Tucker Act justified applying a 'less stringent' sovereign-immunity analysis to FCR than our cases require. . . . It distorted our case law in applying to FCRA the immunity-waiver standard we expressed in [United States v.] White Mountain Apache Tribe, [537 U.S. 465, 472 (2003)] 537 U.S. at 472 [enhanced version available to lexis.com subscribers]; whether the statute '"can fairly be interpreted as mandating compensation by the Federal Government for the damage sustained."' 626 F.3d at 578. That is the test for determining whether a statute that imposes an obligation but does not provide the elements of a cause of action qualifies for suit under the Tucker Act - more specifically, whether the failure to perform an obligation undoubtedly imposed on the Federal Government creates a right to monetary relief. See White Mountain Apache Tribe, supra; Mitchell II [United States v. Mitchell (463 U.S. 206, 216 )], 463 U.S. 206 [enhanced version]. That test is not relevant when a 'mandate of compensation' is contained in a statute that provides a detailed judicial remedy against those who are subject to its requirements. FCRA is such a statute. By using the 'fair interpretation' test to determine whether FCRA's civil liability provisions apply to the United States, the Federal Circuit directed the test to a purpose for which it was not designed and leapfrogged the threshold concern that the Tucker Act cannot be superimposed on an existing remedial scheme."
Solicitor General Donald B. Verrilli Jr. in Washington represents the United States. Gregory A. Beck of Public Citizen Litigation Group in Washington and John G. Jacobs of Chicago represent Bormes.
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