United States v. Bormes (11-192)
Respondent James Bormes used the U.S. government’s online pay system to pay for a lawsuit that he had filed electronically. Following the transaction, the website displayed the last four digits of his credit card and the card’s expiration date. Bormes then sued the government, alleging that it had violated the Fair Credit Reporting Act ("FCRA") by displaying the expiration date. The United States argued that it had sovereign immunity with respect to claims under the FCRA because the Act did not explicitly apply to the U.S. government. When Bormes countered that he could sue the government under the Little Tucker Act, which provides a remedy for those with claims against the government of less than $10,000, the government contended that the Little Tucker Act applied only in situations where parties could not otherwise recover. In deciding this case, the Supreme Court must first determine the scope of the Tucker Acts' waiver of the United States’ sovereign immunity regarding claims brought under the Little Tucker Act for suits based on violations of the FCRA. As the country’s largest employer, creditor, and lender, the U.S. government could see a massive increase in litigation and potential liability as a result of this decision. Additionally, the Supreme Court may address how explicit Congress must act in order to exempt the federal government from liability.
Whether the Little Tucker Act enables plaintiffs to sue the United States for damages arising from violations of the Fair Credit Reporting Act.
In October 2000, the United States launched pay.gov, an online billing and payment processing service that enables consumers to use credit and debit cards to make payments to numerous government agencies. See Bormes v. United States, 638 F. Supp. 2d 958, 959 (N.D. Ill. 2009) vacated, 626 F.3d 575 (Fed. Cir. 2010). On August 9, 2008, James Bormes, an attorney, used this system to pay for a lawsuit electronically filed in the U.S. District Court for the Northern District of Illinois. See id. The system then displayed a confirmation webpage on Bormes’ computer screen, which Bormes printed. See id. The webpage and the printed copy revealed the last four digits of Bormes’ credit card and the expiration date. See id. Bormes filed a class action lawsuit against the United States on behalf of himself and other individual cardholders who were provided electronically printed receipts from pay.gov on or after June 4, 2008. See id. at 960. Bormes alleged that the government’s disclosure of his credit card’s expiration date is in violation of the Fair Credit Reporting Act (“FCRA”), 15. U.S.C. §1681. See id. at 959.
The District Court for the Northern District of Illinois granted the United States’ motion to dismiss the lawsuit. See Bormes, 638 F. Supp. 2d at 962. The district court determined that, because the FCRA does not waive the United States’ sovereign immunity, the lawsuit had no basis. See id. at 961-62. The district court would not waive sovereign immunity without statutory text unequivocally stating that the “United States” could be sued. See id. Although the FCRA imposes liability on any “person” who does not comply with its provisions, the statutory definition of “person” did not explicitly include the term “United States.” See id. Because the FCRA does not waive sovereign immunity, the district court did not address jurisdictional validity, or what laws would allow the district court to hear the case. See Brief for Petitioner, United States at 5.
Bormes appealed to the United States Court of Appeals for the Federal Circuit. See Bormes v. United States, 626 F.3d 574, 576 (Fed. Cir. 2010). The United States filed a motion to transfer the appeal to the Seventh Circuit, but the Federal Circuit denied the motion on the grounds that only the Federal Circuit can hear appealed decisions based in whole or in part upon the Little Tucker Act, 28 U.S.C. 1346(a)(2). See id. The Federal Circuit vacated the district court’s decision and reinstated Bormes’ FCRA claim. See id. at 583. The Federal Circuit highlighted that the FCRA definition of “person” includes “any government” and in some parts of the act “person” refers to the United States. However, without determining whether the FCRA waived sovereign immunity, the Federal Circuit determined that the Little Tucker Act provides an alternative jurisdictional basis. See id. at 578. The Little Tucker Act provides concurrent jurisdiction between the district court and Federal Claims Court for civil actions less than $10,000 against the United States based upon “any Act of Congress.” See id. The Federal Circuit held that the Little Tucker Act applied to the FCRA claim and thereby provided a jurisdictional Basis for Bormes’ lawsuit, and for money damages for FCRA violations. The Federal Circuit held that a fair interpretation of the statute mandated money damages for FCRA violations, and thus the Little Tucker Act applied and there was a jurisdictional basis for Bormes’ lawsuit. See id. at 581-82.
The Little Tucker Act and the Tucker Act (collectively "Tucker Acts") allow a party to bring claims of less than $10,000 against the government by waiving sovereign immunity for particular claims, respectively. The dispute in this case centers on whether the United States may be sued either explicitly under the FCRA or, in the alternative, if the Little Tucker Acts applies. The Supreme Court’s decision in this case will resolve the application of the Tucker Acts to other acts of Congress and the level of specificity needed in a statute for a waiver of sovereign immunity.
Tucker Acts’ Applicability
The United States argues that the Tucker Acts were not intended to apply to federal statutes that provide a specialized remedy. See Brief for Petitioner, United States at 17. Additionally, even if the Tucker Acts could generally apply, the United States argues that the direct statutory conflicts regarding jurisdiction, damages, and the statute of limitations make the Tucker Acts incompatible with the FCRA. See id. at 33-38. Jurisdictionally, the FCRA and Tucker Acts direct plaintiffs to different courts; for damages, the FCRA enables plaintiffs to seek punitive damages although the Tucker Acts only allow compensatory damages; and for the statute of limitations, the FCRA requires plaintiffs to file the lawsuit at the earlier of either two years after the discovery date or five years after the violation date, but the Tucker Acts do not require a plaintiff to file the lawsuit for six years. See id.
Conversely, Bormes argues that the FCRA falls within the scope of the Tucker Acts because it is an “act of Congress.” See Brief for Respondent, James X. Bormes at 11. Furthermore, Bormes asserts that if the Tucker Acts do not apply because of conflicts with other statutes, then they would not apply in other situations in which they were intended to apply, rendering them toothless. See id. at 28-32. Bormes argues that the Tucker Acts are meant to establish a minimal limit, and that Congress is free to impose stricter provisions. See id. at 32. Bormes asserts that if a statute limits damages or provides a shorter statute of limitations than the Tucker Acts, then the stricter provisions govern without invalidating the Tucker Acts’ sovereign immunity waiver. See id.
The United States contends that the government would be exposed to more liability than Congress intended if the Supreme Court applies a broader reading of the Tucker Acts because sovereign immunity would be waived in significantly more instances. See Brief for Petitioner at 29. Specifically, as the largest employer, lender, and creditor in the country, the United States argues that applying the Tucker Acts to cases under the FCRA would greatly increase the United States’ liability and the amount of litigation against it. See id. at 52. The United States’ liability will further increase if the Court finds that the Tucker Acts can be applied to statutes with specific remedial schemes because future plaintiffs could include the Tucker Acts as a basis for suing the United States. See id. at 29. Alternatively, the scope of the Tucker Acts would be notably diminished if the Court finds they are incompatible with statutes that have self-contained remedial schemes. See Brief for Respondent at 7-8.
Explicit Waiver of Sovereign Immunity
The United States argues that sovereign immunity is not waived without an explicit provision including the term “United States.” See Brief for Petitioner at 16. Additionally, the United States contends that a statutory definition may not be consistent throughout all of a statute’s provisions. As a result, even if the United States is explicitly included in the definition of a word in one provision, it may not be included in the definition of the same word in another provision. See id. at 42.
Alternatively, Bormes notes that the FCRA’s definition of a “person” who can be sued includes “any government or governmental subdivision or agency,” and thus explicitly contemplates a waiver of sovereign immunity. See Brief for Respondent at 12. If the Court agrees with the United States’ argument, this will affect the waiver of sovereign immunity for all other statutes. See id. at 21-25.
The United States contends that Congress did not intend to expose the United States to liability under the FCRA. See Brief for Petitioner at 40. The United States notes that the original purpose of the FCRA was to regulate consumer reporting agencies. To expose the United States to liability would disrupt the balance established by the Privacy Act of 1974, which stipulates when the United States can be sued for activities similar to those covered by the FCRA. See id. at 41, 48-49. Given the amount of Congressional debate over the Privacy Act, the United States argues that Congress did not intend to so freely increase the scope of liability through the FCRA. See id. at 49-50.
The outcome of this case will help establish the Tucker Acts’ scope, especially related to statutes with specific remedies. Furthermore, this case raises important questions of statutory interpretation regarding how to read statutory definitions and what is required for a statute to apply to the United States. Overall, this case significantly impacts the United States’ risk of liability because the Tucker Acts may be applied to all other statutes.
The Little Tucker Act allows federal district courts as well as the Court of Federal Claims to adjudicate certain claims against the United States. See 28 U.S.C. § 1346(a)(2). One type of claim for which the Act grants jurisdiction to these courts comprises actions against the government for $10,000 or less that are based on “any Act of Congress.” See id. Among other things, the Fair Credit Reporting Act (“FCRA”) prohibits any person who accepts credit or debit cards for payment from “print[ing] more than the last 5 digits of the card number or the expiration date upon any receipt provided to the cardholder.” See 15 U.S.C. § 1681c(g)(1). Elsewhere, the statute lists the specific remedies that a plaintiff may recover for a willful violation of the FCRA’s provisions. See 15 U.S.C. § 1681n. The Court of Appeals ruled that the Little Tucker Act’s provision regarding actions against the government based on acts of Congress serves not only as a jurisdictional grant to the Court of Federal Claims, but also as a waiver of sovereign immunity. See Bormes v. United States, 626 F.3d 574, 578 (Fed. Cir. 2010). As a result, the court concluded that the Little Tucker Act permits plaintiffs to bring actions against the United States for violations of the FCRA. See id.
Role of the Tucker Acts
The United States argues that the Tucker Acts do not independently allow plaintiffs to bring actions against the government where a statute already provides for a remedy. See Brief for Petitioner, the United States at 17. Instead, the United States posits that the Tucker Acts allow plaintiffs to sue the government in situations where they might not otherwise be able to recover damages. See id. at 17. In support of this argument, the United States points to the principle that a specific statutory scheme should take precedence over a more general right to recover. See id. at 17–18. Thus, because the FCRA provides for remedies for violations of the other sections of the act, the Little Tucker Act’s general right to recover against the government should not apply. See id. at 23.
Bormes counters that the Tucker Acts serve as waivers of immunity by the U.S. government in any case in which a plaintiff might recover damages from the U.S. government on the basis of an act of Congress. See Brief for Respondent, James X. Bormes, at 11. The FCRA’s provisions are to apply to “person[s],” which the FCRA defines to include “any government or governmental agency.” See (15 U.S.C. § 1681a(b). According to Bormes, this definition includes the United States. See Brief for Respondent at 12. Bormes contends that, because the FCRA provides for the recovery of damages against the United States, it falls within the scope of the Tucker Acts. See id. at 12.
The United States also notes that, even if the Tucker Acts did allow recovery against the U.S. government in situations where there was a more specific remedial scheme, the particular provisions of the FCRA are so at odds with the Tucker Acts that the two may not be reconciled in this case. See Brief for Petitioner at 30. Among other differences, the United States cites the Tucker Acts’ exclusion of tort-related lawsuits, which the United States believes FCRA actions to be. See id. at 30–31. Because Congress provided specific details as to the applicability and requirements of the FCRA, the argument goes, it did not intend for a general statute such as the Little Tucker Act to provide litigants a route around those requirements. See id. at 39-40. Thus, the United States argues, Congress did not intend for the FCRA to provide the basis for a cause of action against the government in the absence of the other limitations imposed by the FCRA. See id.
Bormes counters the United States’ argument that the Tucker Acts exclude tort-related lawsuits by noting that his claim relies instead on the provision regarding actions based on statutes. See Brief for Respondent at 33. He notes that, where a statute provides the basis for a claim against the government, it is irrelevant whether the claim involves a tort. See id. at 33. Bormes also argues that FCRA claims are not torts, as such a designation would conflict with the Federal Tort Claims Act. See id. at 39. Additionally, he maintains that, although FCRA claims against the government are not contract-related, they nonetheless need not be relegated to the realm of torts. See id. at 40.
Intent of Congress in Enacting the FCRA
The parties also dispute what the intent of Congress was in enacting the FCRA. The United States maintains that, in enacting the FCRA, Congress did not intend to allow recovery against the government under the Tucker Acts. See Brief for Petitioner at 40. While the FCRA’s definition of person does include “any . . . government”, the United States points out that Congress does not always intend for such definitions to include the U.S. government. See id. at 40 (quoting 15 U.S.C. § 1681a(b)). The United States also argues that Congress would not have intended to so greatly expand the liability of the U.S. government by including it within the scope of the FCRA’s damages provisions. See id. at 44-45. Rather, the United States suggests that Congress intended a more limited reach, pointing to the FCRA’s legislative history and citing mentions of commercial entities in the discussion of which persons would be subject to the damages provisions. See id. at 44–45. Because the government was not included in these discussions, the United States infers that Congress had not considered, and therefore did not intend, that the FCRA would apply to the government. See id.
On the other hand, Bormes argues that the Tucker Acts’ general waiver of sovereign immunity applies unless Congress demonstrates a clear intent to withdraw it. See Brief for Respondent at 26 (citing Preseault v. I.C.C., 491 U.S. 1, 13 (1990)). Bormes contends that, as no such intent appears in the FCRA, the Little Tucker Act allows him to bring an action against the government on the basis of the FCRA. See id. at 26. In support of his argument, Bormes reasons that, contrary to the United States’ position that the Tucker Acts do not apply where there are more specific provisions for recovery, the Tucker Acts apply where a plaintiff may recover under any act of Congress. See id. at 26–27. Additionally, he maintains that any differences between the FCRA’s remedial provisions and the Tucker Acts do not preclude the application of the Tucker Acts to his case. See id. at 29.
In deciding this case, the Supreme Court will elaborate on how explicit Congress must be in order to waive the United States’ sovereign immunity. Additionally, the court will address whether the Little Tucker Act provides a general remedy against the government, or if it applies only in situations in which one could not otherwise recover and is left without statutory remedy. Respondent Bormes argues that the government did waive sovereign immunity when it passed the FCRA. Additionally, Bormes contends that the Little Tucker Act is of general applicability and, as a result, can be used to support his claims that the government violated the FCRA. In contrast, the United States argues that the FCRA did not explicitly state that it should apply to the U.S. government, and so Congress must have intended that it not apply. The United States further claims that the Little Tucker Act may not apply where a statute provides its own remedial scheme, especially where that scheme is at odds with that of the Little Tucker Act. The Court’s decision will have broad impact on potential litigants everywhere, as it will better define the scope of actions that may be brought against the U.S. government.