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Stanley A. Ferguson v. Gregory T. Long

August 16, 2012

STANLEY A. FERGUSON, PLAINTIFF,
v.
GREGORY T. LONG, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Richard W. Roberts United States District Judge

MEMORANDUM OPINION

This case stemmed from a perfect storm of missteps on both sides, with most of them occurring in the bureaucracy responsible for the Thrift Savings Plan ("TSP"). The result is that the undisputed last wishes of a federal employee who relied upon the repeated assurances of the bureaucracy that her husband would be her beneficiary for a $287,000 TSP account will be wholly dishonored. It is a sad result for the surviving spouse of 12 years and a blot on the record of the TSP program.

Plaintiff Stanley Ferguson filed this complaint seeking an order directing the Federal Retirement Thrift Investment Board ("the Board") to provide him with the proceeds of a Thrift Savings Plan ("TSP") account belonging to Ferguson's deceased wife, Tanya Ferguson. Gregory Long, the executive director of the Board, has moved under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) to dismiss, or alternatively for summary judgment, arguing that Stanley*fn1 is not a legal beneficiary with standing to bring a claim for TSP benefits.*fn2 Because the facts are not in dispute and Stanley is not entitled to bring a claim for his deceased wife's TSP benefits, the complaint will be dismissed for lack of subject matter jurisdiction.

BACKGROUND

In October 1993, Tanya, an employee of the U.S. Department of the Treasury, participated in the TSP and properly filed with her employer a valid designation of beneficiary form ("TSP-3 form") designating as her beneficiaries her father, defendant Harold Koch, and defendant Marissa Shunn.*fn3 (Def. Long's Mem. in Supp. of Mot. to Dismiss ("Def.'s Mem."), Ex. A.)*fn4 The Board later changed its regulations to require that TSP-3 forms be filed directly with the Board rather than with the participants' employers. Thus, in 1998, the Board directed Treasury and other participating agencies to forward to the Board all TSP-3 forms employees had previously filed. Treasury did not do so with Tanya's form for over 12 years. (Def.'s Mem. at 3 & n.2.) As a consequence, the TSP annual statement that the Board sent to Tanya erroneously declared in January of each calendar year from and before 2007 through 2010: "You have not designated a beneficiary. Upon your death, your TSP account will be paid[] to your surviving spouse[.]" (Compl. ¶¶ 9-10, 12, 14.) Each annual statement also asked: "Please review this statement for accuracy, as the information in it is considered correct unless you notify us." (Id.; Pl.'s Mem. of P. & A. in Opp. to Mots. to Dis. ("Pl.'s Mem."), Exs. 1, 2.) Tanya apparently reported no errors.

Stanley and Tanya were married in January 1998, over four years after she filed the TSP-3 form. (Compl. ¶ 7.) Treasury, twelve years late, mailed a copy of Tanya's 1993 TSP-3 form to the Board in May 2010. (Def.'s Mem. at 3.) That triggered a string of events. The TSP-3 form reflected Tanya's last name in 1993 (Koch). The last name reflected on her TSP account in 2010, though, was her married name (Ferguson). Thus, the Board sent Tanya a letter dated May 26, 2010 stating it had received her TSP-3 Designation of Beneficiary form, but it could not process the form. It explained that "[t]he participant's name on [the form did] not match the name on the TSP account[.]" (Pl.'s Mem., Ex. 3.) The letter further stated that "if you do not have a form TSP-3 on file, death benefits will be paid according to the statutory order of precedence[,]" which, according to the previous TSP annual statements, would be her surviving spouse. (Compl. ¶¶ 12-14.)

Tanya, of course, had not sent the Board any designation of beneficiary form. She feared that someone had stolen her identity and was trying to steal her TSP funds by sending in a change of beneficiary form. (Pl.'s Mem., Ex. 4 at 3:11-15, 6:7-13.) Tanya promptly telephoned a participant services representative ("PSR") of the Board on June 2, 2010. The PSR explained that the Board had just received Tanya's October 1993 TSP-3 form and was notifying her why it was being rejected and would not be processed. Tanya asked who her current beneficiary was. The PSR erroneously declared that Tanya did not have a beneficiary listed for her account, and confirmed that the proceeds of her account would be paid to Stanley as her surviving spouse if she died. In discussing the question of the most current designation of beneficiary form, Tanya said "I did one that just said 'Cancel all,' so that that would just make it be my spouse."*fn5 The PSR told Tanya, erroneously, that since the form the Board had just received would not be processed, "you don't need to worry about that." (Id. at 3:16-19; 4:2-13; 5:19-6:6; Compl. ¶¶ 15-16.) So, she didn't, even though the Board's May 26, 2010 letter advised her "[t]o ensure that death benefits are paid in a timely manner and in accordance with your current wishes, you should resubmit a corrected form TSP-3, Designation of Beneficiary." (Pl.'s Mem., Ex. 3.) In fact, the Board did match the 1993 form's other identifying information with Tanya's TSP account and, without notifying Tanya, did process the 1993 form and recognize it as valid.

Tanya passed away three weeks later. (Compl. ¶ 7.) Stanley filed a claim for Tanya's TSP account funds. (Id. ¶ 18.)

In August 2010, the Board notified Stanley that Tanya in fact did have a valid TSP-3 form in her file, and that the Board would provide the proceeds of her account to Shunn and Koch, her designated beneficiaries. (Id. ¶ 17.) Stanley protested the denial of his claim, and the Board rejected Stanley's protest. (Id.. ¶¶ 18-20.)

Stanley filed this action seeking an order prohibiting the Board from disbursing the proceeds of Tanya's account to Shunn and Koch, and directing the Board to pay the proceeds of the account to Stanley.*fn6 The Board has moved to dismiss, arguing that the complaint failed to allege sufficiently a waiver of sovereign immunity because Stanley is not a designated beneficiary. Stanley opposes.

DISCUSSION

Under Rule 12(b)(1), a defendant may move to dismiss a complaint for lack of subject-matter jurisdiction. Fed. R. Civ.

P. 12(b)(1). "'Before a court may address the merits of a complaint, it must assure that it has jurisdiction to entertain the claims.'" Sierra Club v. U.S. Environmental Protection Agency, Civil Action No. 08-424 (RWR), 2012 WL 1008680, at *2 (D.D.C. March 27, 2012) (quoting Cornish v. Dudas, 715 F. Supp. 2d 56, 60 (D.D.C. 2010) (internal quotation omitted)). "A plaintiff bears the burden to establish that the court has subject matter jurisdiction over the claims in the complaint." Sierra Club, 2012 WL 1008680, at *2 (citing Shuler v. United States, 531 F.3d 930, 932 (D.C. Cir. 2008). "If the plaintiff fails to do so, the court must dismiss the action." Sierra Club, 2012 WL 1008680, at *2 (citing Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 94 (1998) (citing Ex parte McCardle, 74 U.S. 506, 514 (1868))). "'Because subject-matter jurisdiction focuses on the court's power to hear the claim, however, the court must give the plaintiff's factual allegations closer scrutiny when resolving a Rule 12(b)(1) motion.'" Nat'l Treasury Employees Union v. Whipple, 636 F. Supp. 2d 63, 68 (D.D.C. 2009) (quoting Jin v. Ministry of State Sec., 475 F. Supp. 2d 54, 60 (D.D.C. 2007)). "The court may look beyond the complaint, but 'must accept as true the allegations in the complaint and consider the factual allegations of the complaint in the light most favorable to the non-moving party.'" Whipple, 636 F. Supp. 2d at 68-69 (quoting Short v. Chertoff, 526 F. Supp. 2d 37, 41 (D.D.C. 2007)).

"'[S]overeign immunity is jurisdictional' and '[a]bsent a waiver, . . . shields the Federal Government and its agencies from suit.'" Cohen v. United States, 650 F.3d 717, 723 (D.C. Cir. 2011) (quoting FDIC v. Meyer, 510 U.S. 471, 475 (1994) (citing Loeffler v. Frank, 486 U.S. 549, 554 (1988), and Federal Housing Administration v. Burr, 309 U.S. 242, 244 (1940))). "'It is axiomatic that the United States may not be sued without its consent and that the existence of consent is a prerequisite for jurisdiction.'" Bloch ...


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