PHILIP A. SEVERSON,
UNITED STATES OF AMERICA,
acting through the Bureau of Indian Affairs; and
Crow Creek Reservation High School,
[2001 DSD 6]
District of South Dakota-Central Division
MEMORANDUM OPINION AND ORDER
Timothy M. Engel,
May, Adam, Gerdes & Thompson, Pierre, SD
Attorney for Plaintiff.
Dupris, U.S. Attorney's Office, Pierre, SD
Attorney for the United States.
Mark F. Marshall,
Mark William Haigh, Melissa Carol Hinton
Davenport, Evans, Hurwitz & Smith, Sioux Falls, SD
Attorneys for Crow Creek.
Filed Feb 26, 2001
Richard H. Battey, U. S. District Judge
[¶1] On August 14, 2000, plaintiff Philip A. Severson (Severson) filed a complaint alleging that the United States of America (the United States), acting through the Bureau of Indian Affairs (BIA), and Crow Creek Reservation High School (Crow Creek High), wrongfully terminated his employment with Crow Creek Tribal Schools in violation of the whistleblower provision of the False Claims Act (FCA), 31 USC § 3730(h), and the Federal Tort Claims Act (FTCA), 28 USC §§ 2671-2680. The complaint was amended on December 29, 2000. Following the amended complaint, the United States filed a renewed motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). On February 22, 2001, Crow Creek High filed a renewed motion for summary judgment under Fed. R. Civ. P. 56.
[¶2] Prior to his termination on August 21, 1998, Severson was employed as the Superintendent of Crow Creek High, located within the boundaries of the Crow Creek Sioux Reservation in South Dakota. Crow Creek Tribal Schools is a nonprofit corporation chartered by the Crow Creek Sioux Tribe (the tribe) and funded by the BIA pursuant to the Tribally Controlled Schools Act of 1988, 25 USC §§ 2501-2511.
[¶3] Severson claims he was terminated by Crow Creek Tribal Schools because he refused to condone and attempted to deter the unlawful and fraudulent acts of his fellow employees, Craig Kirkie, Calie Kirkie, and Butch Kirkie. Specifically, Severson alleges "the funds that Craig Kirkie, Calie (Veo) Kirkie, and Butch Kirkie took or attempted to take unlawfully were grant funds paid to [Crow Creek High] by the United States ... ." Amended Complaint at ¶ 8.
[¶4] After reviewing the United States' motion to dismiss, as well as Crow Creek High's motion for summary judgment, this Court concludes it is without jurisdiction over the matters presented in this case.
[¶5] The United States' Motion to Dismiss
[¶6] Severson's amended complaint alleges that the United States, acting through the BIA, subjected him to intentional infliction of emotional distress (Count III), and wrongfully terminated his employment (Count IV). (1) The United States' motion to dismiss primarily challenges this Court's subject matter jurisdiction.
[¶7] Subject matter jurisdiction is a threshold issue which must be assured in every federal action. Kronholm v. Federal Deposit Ins. Corp., 915 F2d 1171, 1174 (8th Cir. 1990) (citing Barclay Square Properties v. Midwest Fed. Sav. & Loan, 893 F2d 968, 969 (8th Cir. 1990)). Because the motion to dismiss is brought pursuant to Fed. R. Civ. P. 12(b)(1), this Court has the authority to move beyond the bare pleadings in determining its jurisdiction. See Drevlow v. Lutheran Church, Missouri Synod, 991 F2d 468, 470 (8th Cir. 1993). Further, this Court's election to do so does not convert the 12(b)(1) motion to dismiss into a motion for summary judgment and no presumptive truthfulness attaches to the plaintiff's allegations. See Osborn v. United States, 918 F2d 724, 729-30 (8th Cir. 1990).
[¶8] Severson brings his suit against the United States under the FTCA, 28 USC §§ 2671-2680. It is well settled that the United States cannot be sued absent a waiver of its sovereign immunity. See, e.g., United States v. Orleans, 425 US 807, 96 SCt 1971, 48 LEd2d 390 (1976); Dykstra v. United States Bureau of Prisons, 140 F3d 791 (8th Cir. 1998). The FTCA waives sovereign immunity for those injuries occasioned by governmental employees acting within the scope of their employment. See 28 USC § 1346(b)(1). This broad waiver is limited, however, by the discretionary function exception which provides that the United States shall not be liable for "[a]ny claim ... based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused." 28 USC § 2680(a). The discretionary function exception is said to mark "the boundary between Congress' willingness to impose tort liability upon the United States and its desire to protect certain governmental activities from exposure to suit by private individuals." United States v. S.A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines), 467 US 797, 808, 104 SCt 2755, 2761-62, 81 LEd2d 660 (1984).
[¶9] Where an alleged act is found to fall within the discretionary function exception, courts are without subject matter jurisdiction over the case. See Jurzec v. American Motors Corp.,
856 F2d 1116, 1118 (8th Cir. 1988). To determine whether the discretionary function exception applies, the Supreme Court has developed a two-part test. See Berkovitz v. United States,
486 US 531, 108 SCt 1954, 100 LEd2d 531 (1988); see also United States v. Gaubert,
499 US 315, 111 SCt 1267, 1273, 113 LEd2d 335 (1991). First, the Court must consider whether the actions taken by the government employees (2) were discretionary, that is, the product of "judgment or choice." See Gaubert, 499 US at 322, 111 SCt 1273. The second step requires that the judgment or choice at issue be grounded in "social, economic, or political policy." Dykstra, 140 F3d at 795; see also Gaubert, 499 US at 323, 111 SCt 1274. When so grounded, the discretionary function exception applies and subject matter jurisdiction is absent. Id.
[¶10] In this case, Severson's claims stem wholly from the decision of Crow Creek Tribal Schools to terminate his employment. Having considered the two-part test described above, this Court concludes that the decision to terminate Severson's employment is the type of determination grounded in judgment or choice that the discretionary exception is designed to shield. See Tonelli v. United States, 60 F3d 492, 496 (8th Cir. 1995) ("Issues of employee supervision and retention generally involve the permissible exercise of policy judgment and fall within the discretionary function exception."); Big Owl v. United States, 961 FSupp 1304, 1309 (DSD 1997) (holding decision to not renew an employee's contract within the discretionary function exception); Daly v. Department of Energy, 741 FSupp 202, 206 (D. Colo. 1990) (holding that employment decisions are discretionary within the meaning of the discretionary function exception). Since the decision to terminate Severson's employment falls within the discretionary function exception, there has been no waiver of the United States' sovereign immunity and this Court is without jurisdiction over Severson's claims.
[¶11] Even assuming this Court was vested with jurisdiction over Severson's FTCA suit, he nonetheless fails to state a claim upon which relief can be granted. See Fed. R. Civ. P. 12(b)(6). In order to state a claim of intentional infliction of emotional distress, Severson must allege conduct on the part of the United States which can be said to have been so extreme and outrageous as to have "exceed[ed] all bounds usually tolerated by decent society and which is of a nature especially calculated to cause, and does cause, mental distress of a very serious kind." Tibke v. McDougall, 479 NW2d 898, 907 (SD 1992) (quoting Groseth Intern., Inc. v. Tenneco, Inc., 410 NW2d 159, 169 (SD 1987)). Severson's amended complaint, construed in a light most favorable to him, simply fails to allege sufficiently outrageous conduct on the part of the government to give rise to a claim of intentional infliction of emotional distress.
[¶12] Similarly, Severson's wrongful termination claim also fails. The FTCA provides a cause of action only for an "injury or loss of property ... caused by the negligent or wrongful act or omission of any employee of the Government ... 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 USC § 1346(b). In short, the FTCA provides a cause of action based solely in tort. In this case, Severson alleges that he was wrongfully terminated for his refusal to condone, and his attempts to stop, the fraudulent activities of his fellow employees. In South Dakota, however, an action for wrongful termination sounds in contract, not in tort. See, e.g., Bass v. Happy Rest, Inc., 507 NW2d 317, 320 (SD 1993); Peterson v. Glory House of Sioux Falls, 443 NW2d 653 (SD 1989); Johnson v. Kreiser's, Inc., 433 NW2d 225, 227 (SD 1988). Accordingly, Severson's wrongful termination claim is not cognizable under the FTCA. See 28 USC §§ 1346(b), 2674; see also Selland v. United States, 966 F2d 346, 347 (8th Cir. 1992) (observing plaintiff must point to a recognized state tort action in order to state a claim under the FTCA).
[¶13] Crow Creek High's Motion for Summary Judgment
[¶14] Turning to the claims against Crow Creek High, Severson alleges (Count I) that the school, "acting by and through its governing board," violated the whistleblower provision of the FCA (fn3) when it terminated him "because of lawful acts done ... in furtherance of the investigation of possible false claims against the United States." Amended Complaint at ¶¶ 10-11. In requesting summary judgment, Crow Creek High challenges this Court's jurisdiction on the grounds of tribal sovereign immunity. (fn4)
[¶15] A movant is entitled to summary judgment if the movant can "show that there is no genuine issue as to any material fact and that [the movant] is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). In determining whether summary judgment should issue, the facts and inferences from those facts are viewed in the light most favorable to the nonmoving party, and the burden is placed on the moving party to establish both the absence of a genuine issue of material fact and that such party is entitled to judgment as a matter of law. See id.; see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 US 574, 106 SCt 1348, 1356-57, 89 LEd2d 538 (1986). After review of the pleadings, affidavits, and exhibits, the Court concludes that it is without jurisdiction over Severson's claims against Crow Creek High.
[¶16] As a threshold matter, the Court notes that Crow Creek Tribal Schools is chartered, funded, and controlled by the Crow Creek Sioux Tribe with its purpose to provide education to tribal children on Indian land. As a member of Crow Creek Tribal Schools, Crow Creek High serves as an "arm of the tribe" and is therefore entitled to be treated like a tribal agency for purposes of this Court's analysis. See Hagen v. Sissteon-Wahpeton Community College, 205 F3d 1040, 1043 (8th Cir. 2000); Dillon v. Yankton Sioux Tribe Housing Auth., 144 F3d 581, 583 (8th Cir. 1998); EEOC v. Fond du Lac Heavy Equip. & Constr. Co., 986 F2d 246, 248 (8th Cir. 1993).
[¶17] In the Eighth Circuit, an assertion of tribal sovereign immunity is a jurisdictional question. See Rupp v. Omaha Indian Tribe, 45 F3d 1241, 1244 (8th Cir. 1995); see also Brown v. United States, 151 F3d 800, 804 (8th Cir. 1998). Indian tribes have long been treated as "domestic dependent nations" that exercise inherent sovereign authority over their members and territories. See Cherokee Nation v. Georgia, 30 US 1, 5 Pet. 1, 17, 8 L. Ed. 25 (1831). Consequently, suits against Indian tribes are barred by the doctrine of tribal sovereign immunity absent a clear waiver by the tribe or Congressional abrogation. See Santa Clara Pueblo v. Martinez, 436 US 49, 58, 98 SCt 1670, 1677, 56 LEd2d 106 (1978). Further, it is well-settled that a tribe's sovereign immunity may extend to tribally created entities such as Crow Creek High. See Dillon, 144 F3d at 583.
[¶18] In this case, Severson has filed suit pursuant to the whistleblower provision of the FCA, 31 USC § 3730(h). While it is true that tribal sovereignty is subject to the superior and plenary control of Congress, see Santa Clara, 436 US at 58, 98 SCt at 1677, Congressional waivers of tribal sovereign immunity "cannot be implied but must be unequivocally expressed." Id. In this regard, the Eighth Circuit has cautioned that courts should "'tread lightly in the absence of clear indications of legislative intent.'" Northern States Power Co. v. Prairie Island Mdewakanton Sioux Indian Community, 991 F2d 458, 462 (8th Cir. 1993) (quoting Santa Clara, 436 US at 60, 98 SCt at 1678).
[¶19] Furthermore, the Court's examination of the FCA is not governed by normal rules of statutory construction. Rather, this Court must construe the statute where at all possible in favor of tribal sovereignty. See Montana v. Blackfeet Tribe, 471 US 759, 766, 105 SCt 2399, 2403, 85 LEd2d 753 (1985) ( "[S]tatutes are to be construed liberally in favor of the Indians, with ambiguous provisions interpreted to their benefit."); County of Oneida v. Oneida Indian Nation, 470 US 226, 247, 105 SCt 1245, 1258, 84 LEd2d 169 (1985) ("[T]he canons of construction applicable in Indian law are rooted in the unique trust relationship between the United States and the Indians. Thus, it is well established that treaties should be construed liberally in favor of the Indians, with ambiguous provisions interpreted to their benefit ... . The Court has applied similar canons of construction in nontreaty matters."); Merrion v. Jicarilla Apache Tribe, 455 US 130, 152, 102 SCt 894, 909, 71 LEd2d 21 (1982) ("[I]f there [is] ambiguity ... the doubt would benefit the tribe, for 'ambiguities in federal law have been construed generously in order to comport with ... traditional notions of sovereignty and with the federal policy of encouraging tribal independence.'") (quoting White Mountain Apache Tribe v. Bracker, 448 US 136, 143-44, 100 SCt 2578, 2583-84, 65 LEd2d 665 (1980)).
[¶20] With the foregoing in mind, this Court has scrutinized the language and legislative history of the FCA's whistleblower provision, and concludes that it is devoid of any language which would abrogate the tribe's sovereignty rights. Crow Creek High's motion for summary judgment shall therefore be granted.
[¶21] After reviewing the amended complaint, as well as the pleadings and affidavits presented, the Court concludes that it is without jurisdiction over the matters presented in this case. Insofar as Severson alleges that the United States subjected him to intentional infliction of emotional distress and wrongful termination, the decision to terminate Severson is within the discretionary function exception of the FTCA, 28 USC § 2680(a). Alternatively, Severson's claims against the United States also fail on the merits. Finally, because the whistleblower provision of the FCA does not contain an unequivocal expression of Congressional abrogation, Severson's claims against Crow Creek High are shielded by the doctrine of tribal sovereign immunity. Accordingly, it is hereby
[¶22] ORDERED that the United States' renewed motion to dismiss (Docket #11, #34) is granted. Severson's claims against the United States are dismissed with prejudice.
[¶23] IT IS FURTHER ORDERED that Crow Creek Reservation High School's renewed motion for summary judgment (Docket #39) is granted. Judgment shall issue in favor of Crow Creek High and against Severson.
1. While Severson also alleges that the United States slandered his professional reputation (Count II), he now concedes that an action for slander is excluded from the FTCA's limited waiver of sovereign immunity. See Severson's Brief in Response to Motion to Dismiss at 2. Accordingly, this claim shall be dismissed without discussion.
2. Although employees of schools operated by Indian tribes under the authority of the Tribally Controlled Schools Act are technically not federal employees, they are deemed to be employees of the BIA for purposes of the FTCA while acting within the scope of their employment and in furtherance of the contract. See 28 USC §§ 2671-80.
3. The whistleblower provision of § 3730(h) states in pertinent part:
Any employee who is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment by his or her employer because of lawful acts done by the employee on behalf of the employee or others in furtherance of an action under this section, including investigation for, initiation of, testimony for, or assistance in an action filed or to be filed under this section, shall be entitled to all relief necessary to make the employee whole.
4. Crow Creek High also argues that the recent case of Vermont Agency of Natural Resources v. United States, 529 US 765, 120 SCt 1858, 146 LEd2d 836 (2000), establishes that as a tribal organization, Crow Creek High cannot be considered a "person" within the meaning of the FCA. In Vermont Agency, the Supreme Court invoked its "longstanding interpretative presumption that [the term] 'person' does not include the sovereign." See 120 SCt at 1866. Upon review, this Court concludes that Crow Creek High's application of Vermont Agency to the facts of this case is misplaced. In the instant suit, Severson's claim is founded upon the whistleblower provision of the FCA, 31 USC § 3730(h), which does not use the term "person" but rather provides that employees who suffer retaliation for pursuing claims under the FCA shall be "made whole." In contrast, Vermont Agency was analyzed under the provision of the FCA which provides that a relator may bring suit against "[a]ny person" who "knowingly presents, or causes to be presented, to an officer or employee of the United States ... a false or fraudulent claim for payment or approval" or who "knowingly makes, uses, or causes to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the Government." 31 USC § 3729(a)(1)-(2) (emphasis added). Because Vermont Agency was analyzed under a specific statute not at issue in this case, that is, § 3729(a)(1)-(2), its rationale has no bearing upon the application of the whistleblower provision, § 3730(h), to defendant, Crow Creek High.