matt law office, pllc terryl t. matt, esq. 310 east main street · 2020. 10. 19. · matt law...
Post on 30-Oct-2020
1 Views
Preview:
TRANSCRIPT
MATT LAW OFFICE, PLLC Terryl T. Matt, Esq. 310 East Main Street Cut Bank, MT 59427 Telephone: (406) 873-4833 Fax: (406) 873-4944 terrylm@mattlawoffice.com Attorney for Plaintiffs
IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MONTANA
BILLINGS DIVISION
LEROY NOT AFRAID and GINGER GOES AHEAD, Plaintiffs, vs. THE UNITED STATES OF AMERICA, and LOUISE ZOKAN-DELOS REYES, in her official and individual capacity; and JO-ELLEN CREE, in her official and individual capacity,
Defendants.
Case No. CV-19-100-BLG-SPW-TJC PLAINTIFFS’ BRIEF IN RESPONSE TO MOTION TO DISMISS
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 1 of 35
Response to Motion to Dismiss – Page 2
TABLE OF CONTENTS
TABLE OF CONTENTS ....................................................................................... 2
TABLE OF AUTHORITIES ................................................................................. 4
INTRODUCTION ................................................................................................. 7
BACKGROUND ................................................................................................... 7
LEGAL STANDARD ............................................................................................ 8
ARGUMENT ......................................................................................................... 8
A. THE FTCA INTENTIONAL TORT AND DISCRETIONARY FUNCTION EXCEPTIONS DO NOT PRECLUDE PLAINTIFFS’ CLAIMS. ..................................................................................................... 9
1. Plaintiffs’ claims are not defamation claims and are not barred by the intentional torts exception to the FTCA. .................................. 9
2. Plaintiffs’ claims are not barred by the FTCA discretionary function exception. ........................................................................... 12
B. PLAINTIFFS HAVE ASSERTED A COGNIZABLE BIVENS CLAIM. ..................................................................................................... 17
C. THE INDIVIDUAL DEFENDANTS ARE NOT ENTITLED TO QUALIFIED IMMUNITY. ........................................................................ 24
D. PLAINTIFFS STATE A CLAIM FOR THEIR NEGLIGENCE-BASED CLAIMS. ..................................................................................... 25
1. Plaintiffs have alleged the existence of duties. ....................... 25
2. Plaintiffs have alleged breaches of the duties alleged. ............ 27
3. Plaintiffs have alleged causation. ........................................... 30
E. PLAINTIFFS HAVE ADEQUATELY ALLEGED CONSTRUCTIVE FRAUD AND BREACH OF THE IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING. ........................ 31
CONCLUSION.................................................................................................... 33
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 2 of 35
Response to Motion to Dismiss – Page 3
CERTIFICATE OF COMPLIANCE .................................................................... 34
CERTIFICATE OF SERVICE ............................................................................. 35
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 3 of 35
Response to Motion to Dismiss – Page 4
TABLE OF AUTHORITIES
Cases
Adams v. Johnson, 355 F.3d 1179 (9th Cir. 2004) ............................................... 18
Am. Nat’l Ins. Co. v. FDIC, 642 F.3d 1137 (D.C. Cir. 2011) ................................. 8
Anderson v. Creighton, 483 U.S. 635 (1987) ....................................................... 24
ARA Leisure Servs. v. United States, 831 F.2d 193 (9th Cir. 1987) .......... 13, 15, 17
Arrowhead Sch. Dist. No. 75 v. Klyap, 79 P.3d 250 (Mont. 2003) ....................... 26
Ashcroft v. al-Kidd, 563 U.S. 731 (2011)............................................................. 24
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) ............................................ 7, 8, 27, 28
Bailey v. United States, 623 F.3d 855 (9th Cir. 2010) .......................................... 15
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) .................................... 7, 8, 27, 28
Berkovitz v. United States, 486 U.S. 531 (1988) .................................................. 14
Bivens v. Six Unknown Named Agents, 403 U.S. 388 (1971) . 18, 19, 20, 21, 22, 23, 24
Bixby v. KBR, Inc., 893 F. Supp. 2d 1067 (D. Or. 2012)...................................... 32
Block v. Neal, 460 U.S. 289 (1983) ..................................................................... 10
Bolt v. United States, 509 F.3d 1028 (9th Cir. 2007) ........................................... 15
Covey v. Brishka, 445 P.3d 785 (Mont. 2019) ..................................................... 31
Dalehite v. United States, 346 U.S. 15 (1953) ..................................................... 13
Dellums v. Powell, 566 F.2d 167 (D.C. Cir. 1977) ............................................... 19
DiMartini v. Ferrin, 889 F.2d 922 (9th Cir. 1989), amended on pet. for rehearing en banc, 906 F.2d 465, 466 (9th Cir. 1990)....................................................... 19
Erickson v. United States, 976 F.2d 1299 (9th Cir. 1992)..................................... 19
Faber v. United States, 56 F.3d 1122 (9th Cir. 1995) .......................................... 13
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 4 of 35
Response to Motion to Dismiss – Page 5
Gibson v. United States, 781 F.2d 1334 (9th Cir. 1986) ....................................... 19
Harlow v. Fitzgerald, 457 U.S. 800 (1982) ......................................................... 24
Harris v. Roderick, 126 F.3d 1189 (9th Cir.1997) ............................................... 31
Hartman v. Moore, 547 U.S. 250 (2006) .............................................................. 19
Hoesl v. United States, 451 F. Supp. 1170 (N.D. Cal. 1978), aff’d, 629 F.2d 586 (9th Cir. 1980) .................................................................................................. 11
Indian Towing Co. v. United States, 350 U.S. 61 (1955) .................... 12, 15, 16, 17
Jefferson v. Harris, 170 F. Supp. 3d 194 (D.D.C. 2016) ................................. 10, 11
Lanuza v. Love, 899 F.3d 1019 (9th Cir. 2018) ................. 18, 20, 21, 22, 23, 24, 25
Marlys Bear Medicine v. U.S. ex rel. Sec’y of Interior, 241 F.3d 1208 (9th Cir. 2001) ............................................................................................... 12, 15, 16, 17
Mendocino Envtl. Ctr. v. Mendocino Cnty., 14 F.3d 457 (9th Cir. 1994) .............. 19
Moss v. Secret Service, 572 F.3d 962 (9th Cir. 2009) ........................................... 19
Myers v. United States, 652 F.3d 1021 (9th Cir. 2011) ........................................ 13
Nance v. E.P.A., 645 F.2d 701 (9th Cir. 1981) ..................................................... 26
Nurse v. United States, 226 F.3d 996 (9th Cir. 2000) .......................................... 14
Paton v. La Prade, 524 F.2d 862 (3d Cir. 1975) .................................................. 19
Peeler v. Rocky Mountain Log Homes Can., Inc., 431 P.3d 911 (Mont. 2018) ... 27, 33
Rayonier Inc. v. United States, 352 U.S. 315 (1957) ........................................... 10
Saucier v. Katz, 533 U.S. 194 (2001) ................................................................... 24
Seminole Nation v. United States, 316 U.S. 286 (1942) ....................................... 26
Sheehan v. United States, 896 F.2d 1168 (9th Cir. 1990) ...................................... 9
Soldano v. United States, 453 F.3d 1140 (9th Cir. 2006) ..................................... 14
Story v. Bozeman, 791 P.2d 767 (1990) ............................................................... 26
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 5 of 35
Response to Motion to Dismiss – Page 6
Taylor v. Barkes, 135 S.Ct. 2042 (2015) .............................................................. 24
Terbush v. United States, 516 F.3d 1125 (9th Cir. 2008) ..................................... 13
Tsosie ex rel. Estate of Tsosie v. U.S., 441 F. Supp. 2d 1100 (D.N.M. 2004) ...... 26
United States v. Gaubert, 499 U.S. 315 (1991) .................................................... 14
United States v. S.A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines), 467 U.S. 797 (1984) ......................................................................................... 13
Westra v. Marcus, 129 Cal. App. 4th 759 (Cal. Ct. App. 2005) ...................... 27, 33
Whisnant v. United States, 400 F.3d 1177 (9th Cir. 2005) ........................ 14, 15, 17
Wood v. Moss, 134 S. Ct. 2056 (2014) ................................................................. 19
Ziglar v. Abbasi, 137 S. Ct. 1843 (2017) ............................................ 18, 20, 21, 22
Statutes
28 U.S.C. § 2680 ...............................................................................................9, 13
Federal Tort Claims Act (FTCA), 28 U.S.C. § 2671-2680 .. 7, 9, 11, 12, 16, 25, 26
Mont. Code Ann. § 27-1-802 ................................................................................. 9
Mont. Code Ann. § 28-1-211 ............................................................................... 26
Rules
D. Mont. L.R. 7.1(d)(2) ........................................................................................ 34
Fed. R. Civ. P. 12(b) .................................................................................. 7, 8, 30
Constitutional Provisions
U.S. Const. Amend. I .......................................................................... 17, 19, 21, 26
U.S. Const. Amend. V ........................................................................ 18, 19, 21, 26
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 6 of 35
Response to Motion to Dismiss – Page 7
INTRODUCTION
Plaintiffs Leroy Not Afraid (Not Afraid), and Ginger Goes Ahead
(Goes Ahead) (Plaintiffs, collectively), hereby submit this Response to the
Fed. R. Civ. P. 12(b)(1) and (6) motion to dismiss filed by Defendants the
United States of America; DOI RMR Indian Services Officer, Louise Zokan-
Delos Reyes (Reyes); and DOI RMR Tribal Operations Officer, Jo-Ellen Cree
(Cree) (Defendants, collectively). As set forth herein, Plaintiffs have asserted
claims upon which relief can be granted, and the statutory exceptions to the
waiver of sovereign immunity in the Federal Tort Claims Act (FTCA), 28 U.S.C.
§ 2671-2680, do not apply. Accordingly, Plaintiffs respectfully request that the
Court deny the motion to dismiss and allow Plaintiffs the opportunity to present
their claims to a jury.
BACKGROUND
Because Defendants have filed a motion to dismiss (dkt. 13-14) under Fed.
R. Civ. P. 12(b), the relevant facts are those alleged in the Amended Complaint
(the Complaint) (dkt. 4), which are to be accepted as true and construed in a light
most favorable to Plaintiffs. See Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). Plaintiffs
hereby incorporate the allegations of the Complaint (dkt. 4) as if set forth fully
herein.
In sum, Plaintiffs, who worked in the Crow Tribal Court, sued Defendants
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 7 of 35
Response to Motion to Dismiss – Page 8
for preparing an Awarding Officials Technical Representative Report (AOTR) that
levelled numerous false and misleading accusations against them. As a result of
the AOTR, Plaintiffs suffered economic harm, damage to reputation and
emotional damages, including wrongful termination from employment. The
AOTR was conducted in connection with contract number A12AV00409 (the
Contract) between the United States, acting through the Department of Interior
(DOI) and Bureau of Indian Affairs (BIA), and the Crow Tribe.
Plaintiffs have sued Defendants for their misconduct in an Amended
Complaint (the Complaint) asserting VIII claims for relief. Defendants have
moved to dismiss these claims (dkt. 13-14) and Plaintiffs hereby submit this
response.
LEGAL STANDARD
A Fed. R. Civ. P. 12(b)(6) motion tests whether the complaint “state[s] a
claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). “To survive a
motion to dismiss [under Rule 12(b)(6)], a complaint must contain sufficient
factual matter, accepted as true, to ‘state a claim to relief that is plausible on its
face.’” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). A plaintiff
receives the “benefit of all inferences that can be derived from the facts
alleged.” Am. Nat’l Ins. Co. v. FDIC, 642 F.3d 1137, 1139 (D.C. Cir.
2011) (internal quotation marks and citation omitted).
ARGUMENT
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 8 of 35
Response to Motion to Dismiss – Page 9
A. THE FTCA INTENTIONAL TORT AND DISCRETIONARY FUNCTION EXCEPTIONS DO NOT PRECLUDE PLAINTIFFS’ CLAIMS.
1. Plaintiffs’ claims are not defamation claims and are not barred by the intentional torts exception to the FTCA.
Plaintiffs’ claims asserted in Counts II-V and VII1 are precisely what they
purport to be. They are not, as the Defendant argue, disguised claims for
defamation. The reason for this is straightforward – Defendants owed various
duties to Plaintiffs separate and apart from the duty to refrain from “unprivileged
publication […] that exposes any person to hatred, contempt, ridicule, or obloquy
or causes a person to be shunned or avoided or that has a tendency to injure a
person in the person’s occupation.” Mont. Code Ann. § 27-1-802. As alleged in
the Complaint, the Defendants breached these respective duties, and these
breaches are not covered by the FTCA. That these breaches may have also
constituted defamation is irrelevant to the FTCA analysis.
The intentional torts exception to the FTCA is strictly construed. Sheehan v.
United States, 896 F.2d 1168, 1170 (9th Cir. 1990) (“[there] is no justification for
this Court [or any court] to read exemptions into the [Federal Tort Claims] Act
beyond those provided by Congress.”) (quoting Rayonier Inc. v. United States,
1 Plaintiffs concede that their claim for interference with contractual relations
(Count VI) is precluded by 28 U.S.C. § 2680(h). Plaintiffs therefore withdraw that count and/or consent to its dismissal.
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 9 of 35
Response to Motion to Dismiss – Page 10
352 U.S. 315, 320 (1957)). Additionally, the government may not evade liability
simply because its conduct may constitute conduct protected under the FTCA, in
addition to unprotected conduct. See Block v. Neal, 460 U.S. 289, 298 (1983)
(“Neither the language nor history of the [FTCA] suggests that when one aspect of
the Government’s conduct is not actionable under the “misrepresentation”
exception, a claimant is barred from pursuing a distinct claim arising out of other
aspects of the Government’s conduct.”).
A district court in the District of Columbia rejected precisely the argument
that Defendants advance here. Jefferson v. Harris, 170 F. Supp. 3d 194, 206
(D.D.C. 2016). In Jefferson, the plaintiff served as an Assistant Secretary of Labor
in the Department of Labor (DOL). Id. at 198-99. The DOL’s Office of Inspector
General (OIG) conducted an investigation and prepared a report regarding the
plaintiff’s possible legal and ethical violations. Id. The report concluded that
plaintiff in fact committed legal and ethical violations in the hiring of three
consultants. Id. at 199-201. In response to the report, the DOL placed the plaintiff
on administrative leave, and the findings of the report were shared with the media.
Id. at 201-02. The plaintiff resigned and found it difficult to find a new job as a
result of the report. Id. at 202.
Plaintiff sued, asserting various claims alleging generally that the report was
flawed and the conclusions presented were inaccurate. Id. at 202. The defendants
argued, as Defendants argue in the above-captioned matter, that the plaintiff’s
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 10 of 35
Response to Motion to Dismiss – Page 11
claims were defamation claims in disguise, and thus barred by the FTCA. Id. at
206. The court rejected this argument because
[i]n attacking not only the defamatory statements themselves, but also his loss of employment and the inadequacy of the procedural protections available for challenging the accusations levied against him, Plaintiff makes clear that he is not simply relying on artful pleading to constitutionalize a simple tort claim.
Jefferson, 170 F. Supp. 3d at 206.
Likewise, in the present case, Defendants’ reliance on the FTCA “falls flat.”
Id. Although Plaintiffs claims possess some of the same characteristics of a
defamation claim, Plaintiffs are not simply relying on artful pleading to bring a
simple tort claim. Id. Like the plaintiff in Jefferson, Plaintiffs here are “attacking
not only the defamatory statements themselves, but also [their] loss of employment
and the inadequacy of procedural protections available for challenging the
accusations levied against [them]”, as well as violations of tribal sovereignty and
the rights of tribal members. Id. As in Jefferson, although Defendants’ conduct
also constitutes defamation, Plaintiffs have stated claims premised on breaches of
duties separate and apart from the duty to refrain from making defamatory
statements, and damages beyond those that would naturally follow from
defamation. The FTCA does not bar these claims.
The Defendants reliance on Hoesl v. United States is misplaced. 451 F.
Supp. 1170, 1174 (N.D. Cal. 1978), aff’d, 629 F.2d 586 (9th Cir. 1980).
However, closer review of the facts in that case reveal critical distinctions. In
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 11 of 35
Response to Motion to Dismiss – Page 12
Hoesl, a plaintiff sued a government doctor for medical malpractice. Id.
However, the plaintiff failed to allege a mistaken diagnosis followed by resulting
improper treatment and injury to the patient’s physical or mental health, and thus
failed to allege a traditional malpractice claim. Hoesl, 451 F. Supp. at 1173.
Because the plaintiff made no such allegations, the court held he in fact asserted
only a claim for defamation, which is precluded by the FTCA. Id. at 1173-75.
Plaintiffs here have alleged facts and duties that support claims other than
defamation. Jefferson, not Hoesl, presents the relevant analysis and, pursuant to
that analysis, Plaintiffs’ claims are not barred by the FTCA.
2. Plaintiffs’ claims are not barred by the FTCA discretionary function exception.
Defendants’ invocation of the discretionary function exception to the
government’s waiver of sovereign immunity under the FTCA is misplaced
because Plaintiffs have alleged that Defendants contractually agreed to take on
certain duties and then failed to perform those duties. Under these circumstances,
courts have regularly rejected the government’s assertion of immunity pursuant to
the discretionary function exception. See Indian Towing Co. v. United States, 350
U.S. 61, 68-69 (1955) (the government’s decision to build a lighthouse was
protected from liability, but the manner in which it operated the lighthouse was
not); Marlys Bear Medicine v. U.S. ex rel. Sec’y of Interior, 241 F.3d 1208, 1215
(9th Cir. 2001) (distinguishing “the decision to take safety measures” from “the
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 12 of 35
Response to Motion to Dismiss – Page 13
negligent implementation of those measures.”); Faber v. United States, 56 F.3d
1122, 1124 (9th Cir. 1995) (“in cases where the government is alleged to have
committed negligence in the performance of a function such as that performed by
a private citizen, rather than in the fulfillment of a broad policy-making duty, the
government is subject to suit.”).
The discretionary function exception to federal waiver of sovereign
immunity provides immunity from suit 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 U.S.C. § 2680(a). “The government
bears the burden of proving that the discretionary function exception applies.”
Myers v. United States, 652 F.3d 1021, 1028 (9th Cir. 2011).
The purpose of the discretionary-function exception is to prevent tort claims
from becoming a medium for “judicial ‘second guessing’ of legislative and
administrative decisions grounded in social, economic, and political policy ....”
Terbush v. United States, 516 F.3d 1125, 1129 (9th Cir. 2008) (citing United
States v. S.A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines), 467 U.S.
797, 814 (1984)); Myers, 652 F.3d at 1028. In other words, the exception
immunizes only high-level policy decisions, not “garden variety” tort claims. See,
e.g., ARA Leisure Servs. v. United States, 831 F.2d 193, 196 (9th Cir. 1987); see
also Dalehite v. United States, 346 U.S. 15, 28 (1953).
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 13 of 35
Response to Motion to Dismiss – Page 14
There is a two-step inquiry to determine whether the discretionary function
exception applies. Nurse v. United States, 226 F.3d 996, 1001 (9th Cir. 2000).
First, the court must determine whether the challenged conduct involves an
element of judgment or choice. Id. (citing Berkovitz v. United States, 486 U.S.
531, 536 (1988)). The element of judgment or choice is removed where a federal
statute, regulation, or policy specifically prescribes a particular course of conduct.
United States v. Gaubert, 499 U.S. 315, 322-23 (1991).
If the challenged action is discretionary, then prong two requires the trial
court to determine “whether the challenged action is of the type Congress meant
to protect -- i.e., whether the action involves a decision susceptible to social,
economic, or political policy analysis.” Whisnant v. United States, 400 F.3d 1177,
1181 (9th Cir. 2005); see also Gaubert, 499 U.S. at 322-23. The “focus of the
inquiry is not on the agent’s subjective intent in exercising the discretion
conferred by statute or regulation, but on the nature of the actions taken and on
whether they are susceptible to policy analysis.” Gaubert, 499 U.S. at 325.
“[T]he distinction between protected and unprotected decisions can be
difficult to apprehend.” Soldano v. United States, 453 F.3d 1140, 1145 (9th Cir.
2006). But the Court of Appeals has delineated a crucial distinction between
designing a statute, policy, or regulation, which is immune, and implementing a
statute, policy, or regulation, which is not. Soldano, 453 F.3d at 1144-46. In
Soldano, for example, this Court held that designing a road without warning signs
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 14 of 35
Response to Motion to Dismiss – Page 15
was a policy decision, but the Park Service’s decision to set the speed limit “was
circumscribed by objective safety criteria and was not the result of a policy
decision of the kind protected by the discretionary function exception.” Id. at
1147. And this Court has often held that governmental acts taken to implement
safety regulations are not of the kind that are “susceptible to policy analysis.”
Bailey v. United States, 623 F.3d 855, 861 (9th Cir. 2010); Whisnant, 400 F.3d at
1181-82 (discussed infra); Bear Medicine, 241 F.3d at 1215 (“The decision to
adopt safety precautions may be based in policy considerations, but the
implementation of those precautions is not”); Bolt v. United States, 509 F.3d
1028, 1033 (9th Cir. 2007) (failing to comply with routine snow-removal safety
policy is not “the type of decision-making that the discretionary function
[exception] was designed to protect”); ARA Leisure, 831 F.2d at 195 (while initial
road design might be immune policy-based decision, Park Service’s failure to
maintain safe roads is not immune).
In Indian Towing, the Coast Guard’s negligent operation of a lighthouse
caused a shipping accident. Indian Towing Co., 350 U.S. at 62. The Supreme
Court rejected the government’s invocation of the discretionary function exception
and held that the Government’s decision to build a lighthouse might be protected
from tort, but the manner in which it operated the lighthouse was not. Indian
Towing, 350 U.S. at 69 (“The Coast Guard need not undertake the lighthouse
service. But once it exercised its discretion to operate a light ... then the Coast
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 15 of 35
Response to Motion to Dismiss – Page 16
Guard was further obligated to use due care ... to repair the light or give warning
that it was not functioning.”).
Similarly, in Bear Medicine, the Ninth Circuit distinguished between “the
decision to take safety measures” from “the negligent implementation of those
measures.” 241 F.3d at 1212. In that case, the Ninth Circuit analyzed whether the
Government’s failure to supervise a logging operation by a private timber
company gave rise to a claim against the BIA under the FTCA. Id. The Ninth
Circuit acknowledged that granting the logging contract was a protected
discretionary choice, but rejected the argument that the failure to supervise the
timber operation, which the contract required, could be considered a policy
choice. Id. at 1215 (“Even if the BIA did have discretion in its monitoring of the
[logging] operation, its actions in carrying out its responsibilities were not
protected policy judgments and therefore fail to satisfy the second prong of the
discretionary function analysis.”).
The dispositive factor in both Indian Towing and Bear Medicine was the
fact that the Government had agreed to take on certain duties and then failed to
perform those duties. Similarly, in this case, Plaintiffs’ claims arise out of the
government’s contractual agreement to take on certain duties, and its breaches of
those duties. Central to Plaintiffs’ claims are the obligations the Defendants took
on by entering into the Contract, as well as prior treaties, with the Crow Tribe.
Pursuant to the foregoing authority, while the decision to enter into treaties
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 16 of 35
Response to Motion to Dismiss – Page 17
and the Contract with the Crow Tribe may have been protected decisions under
the discretionary function exception, Defendants’ negligent violations of those
obligations were not protected policy judgments and therefore fail to satisfy the
second prong of the discretionary function analysis. Defendants actions in
negligently preparing the AOTR did not “involve[] a decision susceptible to
social, economic, or political policy analysis.” Whisnant, 400 F.3d at 1181; see
ARA Leisure Servs., 831 F.2d at 196 (discretionary function exception immunizes
highlevel policy decisions only); Dalehite, 346 U.S. at 27-28 (same). To the
contrary, Plaintiffs’ claims that Defendants breached various legal obligations by
acting negligently in connection with the AOTR are “garden-variety” torts for
which the discretionary function exception provides no immunity. ARA Leisure
Servs., 831 F.2d at 196. Therefore, as in Indian Towing and Bear Medicine, the
discretionary function exception does not apply here and Plaintiffs are entitled to
have their claims adjudicated on the merits.
B. PLAINTIFFS HAVE ASSERTED A COGNIZABLE BIVENS CLAIM.
Plaintiffs have alleged that Defendants “retaliated against them for th[eir]
exercise of their First Amendment rights, causing economic harm, damage to
reputation and emotional damages.” (Dkt. 4 at 24-25). In support of this claim,
Plaintiffs allege that the AOTR contained egregious errors made intentionally to
harm plaintiffs, and that these intentional errors caused harm including improper
termination from the Tribal Court. (Dkt. 4 at 25). Plaintiffs alleged also that this
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 17 of 35
Response to Motion to Dismiss – Page 18
improper conduct deprived Plaintiffs of their procedural due process under the
Fifth Amendment to the United States Constitution. (Dkt. 4 at 25). Consequently,
Plaintiffs have asserted a claim against Reyes and Cree in their individual
capacities pursuant to Bivens v. Six Unknown Named Agents, 403 U.S. 388 (1971).
(Dkt. 4 at 24-25).
Defendants have moved to dismiss Plaintiffs’ Bivens claim, relying
primarily upon the recent Supreme Court decision in Ziglar v. Abbasi, 137 S. Ct.
1843, 1857 (2017). (Dkt. 14 at 14-17).2 However, the Ninth Circuit has recently
interpreted and applied Abbasi to a Bivens claim substantially similar to that
presented here and allowed that claim to proceed. See Lanuza v. Love, 899 F.3d
1019, 1026 (9th Cir. 2018). The Court of Appeals held that the district court’s
dismissal of the Bivens claim was in error, holding “while Abbasi clearly limited
Bivens’s scope, it did not preclude this case; nor is this case precluded by other
Supreme Court precedent.” Id. Because Plaintiffs’ Bivens claim here is materially
similar to that permitted in Lanuza, dismissal would likewise constitute error.
A Bivens claim is a private action against federal officials in their individual
capacities for alleged violations of a plaintiff’s constitutional rights. Adams v.
Johnson, 355 F.3d 1179, 1183 (9th Cir. 2004). Courts have allowed Bivens
2 Page number references to Defendants’ Motion to Dismiss refer to numbers on
the document, not the ECF stamp.
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 18 of 35
Response to Motion to Dismiss – Page 19
remedies for a range of constitutional violations by law enforcement, including
violations of the Fifth Amendment’s Due Process Clause,3 and the First
Amendment’s speech protections.4 In particular, courts have long allowed Bivens
actions alleging that law enforcement acted based on illegal motives, including
discrimination and retaliation in violation of the First Amendment.5
3 See, e.g., DiMartini v. Ferrin, 889 F.2d 922 (9th Cir. 1989), amended on pet. for
rehearing en banc, 906 F.2d 465, 466 (9th Cir. 1990) (Bivens due process claim against FBI agent who allegedly had plaintiff fired from private job for not cooperating with investigation).
4 See, e.g., Dellums v. Powell, 566 F.2d 167, 194-95 (D.C. Cir. 1977) (First Amendment Bivens claim alleging federal officers prevented plaintiffs from protesting war); Paton v. La Prade, 524 F.2d 862, 869–70 (3d Cir. 1975) (First Amendment Bivens claim that FBI agents conducted unlawful surveillance of political correspondence).
5 See Gibson v. United States, 781 F.2d 1334, 1342 (9th Cir. 1986) (First Amendment Bivens claim against FBI agents who allegedly sought to discourage political activities by wiretapping telephone, passing defamatory information to employers, and seeking to entrap plaintiff); Hartman v. Moore, 547 U.S. 250, 256 (2006) (stating First Amendment retaliation claim “on the authority of Bivens”). Following Gibson, the Ninth Circuit has repeatedly entertained Bivens challenges to law enforcement investigations as retaliation for protected First Amendment speech. See, e.g., Moss v. Secret Service, 572 F.3d 962, 967 n.4 (9th Cir. 2009) (First Amendment Bivens claim against secret service’s relocation of protest critical of the president), overruled on other grounds in Wood v. Moss, 134 S. Ct. 2056, 2066 (2014) (“assum[ing] without deciding that Bivens extends to First Amendment claims” and reversing on qualified immunity); Mendocino Envtl. Ctr. v. Mendocino Cnty., 14 F.3d 457, 461-64 (9th Cir. 1994) (First Amendment Bivens claims against FBI officers for chilling speech through unlawful arrests, release of false accusations, and interrogation of associates); Erickson v. United States, 976 F.2d 1299, 1301 (9th Cir. 1992).
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 19 of 35
Response to Motion to Dismiss – Page 20
In Abbasi, the Supreme Court addressed Bivens claims implicating foreign
policy and national security issues after the September 11, 2001 terrorist attacks.
Abbasi, 137 S. Ct. 1843. The Court found that, because the case would require the
judiciary to review national security policy, it should refrain from entering a
sphere more properly suited to the Executive and Legislative branches. Id. at
1861. The Abassi Court distinguished cases involving broad policy concerns from
cases such as this in which individuals are seeking to vindicate specific
constitutional violations. Abassi, 137 S. Ct. at 1862.
In Lanuza, the Ninth Circuit Court of Appeals directly confronted the
import of Abassi, beginning with the question “where does Bivens stand?” in the
wake of that decision. 899 F.3d at 1021. Lanuza addressed a situation in which a
U.S. Immigration and Customs Enforcement (ICE) Assistant Chief Counsel
representing the government intentionally forged and submitted an ostensible
government document in an immigration proceeding, which had the effect of
barring the plaintiff from obtaining lawful permanent resident status. Id.
The Court of Appeals noted that no case precluded extension of Bivens to
the circumstances presented, namely, the falsification of evidence. Id. at 1025-27.
The Court observed that the falsification of evidence “has been regularly
considered by the courts in actions against prosecutors who commit similar
constitutional violations by falsifying evidence and suborning perjury.” Id. at
1025-26 (“‘[t]he principle that a State may not knowingly use false evidence ... to
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 20 of 35
Response to Motion to Dismiss – Page 21
obtain a tainted conviction [is] implicit in any concept of ordered liberty,’ and a
violation of due process.”). The Court therefore held that “[w]hile the Supreme
Court has not extended Bivens to a case involving the substantive and procedural
clauses of the Fifth Amendment, Abbasi did not preclude the possibility of such
an extension.” Id. (citing Abbasi, 137 S.Ct. at 1860–64).
Plaintiffs’ Bivens claim in the above-captioned matter is analogous to that at
issue in Lanuza. As in Lanuza, Plaintiffs’ Bivens claim here is premised upon
Defendants presentation of false evidence in the AOTR, which not only violated
Plaintiffs’ Fifth Amendment due process rights, but also constituted retaliation for
Plaintiffs’ exercise of their First Amendment rights. Like the claim in Lanuza, the
analysis must therefore proceed to the established two-part test, looking to
whether the plaintiff is seeking a Bivens remedy in a new context and, if so,
whether “special factors counsel[] hesitation.” Id. at 1023 (citing Abbasi, 137
S.Ct. at 1853-60).
The Court in Lanuza determined that the claim arose in a new context, as
the claim was “different in a meaningful way from previous Bivens cases decided
by [the Supreme Court].” Id. at 1023. Under this standard, it is submitted that
Plaintiffs’ claim does not arise in a new context because it is not different in a
meaningful way from the issue decided in Lanuza. To the extent the claim here is
determined to arise in a new context, Bivens must nonetheless be extended to
cover the claim for the same reasons it was extended in Lanuza.
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 21 of 35
Response to Motion to Dismiss – Page 22
In Lanuza, applying principles announced in Abbasi, the Court found there
were “no ‘special factors’ suggesting Bivens remedies should be unavailable.” Id.
at 1028. It evaluated the relevant special factors and concluded none militated
against extending Bivens because (1) the attorney sued was a “low-level” federal
officer; (2) the plaintiff did not “challenge or seek to alter the policy of the
political branches” because the government does not have a policy of allowing
federal officers to submit forged documents in immigration proceedings; (3) the
suit would not overly burden the Executive branch given that the case concerned
only the actions of a single low-level federal officer; (4) litigation would not
reveal sensitive information; (5) the case did not garner any executive or
congressional attention, and Congress did not indicate intent to abstain from
creating a remedy; and (6) there was no adequate remedial scheme available to the
plaintiff to challenge the harm caused by the forged document if the forgery went
undiscovered because “[t]he system does not account for actions designed to
circumvent it.” Id. at 1028-32.
Finally, the Court of Appeals addressed “‘whether the Judiciary is well
suited, absent congressional action or instruction, to consider and weigh the costs
and benefits of allowing a damages action to proceed.’” Id. at 1032 (quoting
Abbasi, 137 S.Ct. at 1858). It answered this question in the affirmative because:
[w]hether the evidence was falsified, and whether it was submitted willfully, and whether the submission of that evidence deprived
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 22 of 35
Response to Motion to Dismiss – Page 23
Lanuza of his right to due process, have definite answers, and we have “established methods” to come to these conclusions.
Id. at 1033.
All of the reasons for extending Bivens to the circumstances in Lanuza apply
here with equal weight. As in Lanuza, the claim here alleges that low-level officers
harmed the plaintiffs by falsifying evidence. There is no reason to distinguish the
contract administration context here from the immigration context in Lanuza.
Like the attorney in Lanuza, Reyes and Cree are “low-level” federal officers.
Seeking damages for improper retaliatory false accusations leveled by low-level
officers does not challenge or seek to alter the policy of the political branches, as
the government does not have a policy of including false accusations in AOTRs to
retaliate against tribal officials and usurp tribal sovereignty. The suit would not
overly burden the Executive Branch, as it involves isolated misconduct from two
low-level officers. Litigation would not reveal sensitive government information.
The case has not garnered executive or legislative attention, and there is no reason
to believe Congress intended to protect individual federal officers from liability for
submitting false reports. There is no adequate remedial statutory scheme available
for Plaintiffs to seek recourse, as Reyes and Cree’s false report circumvents any
recourse that may have been available. Finally, as in Lanuza, the judiciary is well-
equipped to determine whether the content of the AOTR was falsified, whether it
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 23 of 35
Response to Motion to Dismiss – Page 24
was submitted willfully, and whether the submission of the AOTR deprived
Plaintiffs of their rights to due process and free speech. Lanuza, 899 F.3d at 1033.
With respect to the “special factors” analysis, the two cases cannot be
meaningfully distinguished. As in Lanuza, the Plaintiffs here have made a
facially adequate Bivens claim, and dismissal of the claim would be improper.
C. THE INDIVIDUAL DEFENDANTS ARE NOT ENTITLED TO QUALIFIED IMMUNITY.
Defendants’ arguments that they are entitled to qualified immunity on
Plaintiffs’ claims are meritless. Although “[d]amages actions against high
officials are… an important means of vindicating constitutional guarantees,”
Harlow v. Fitzgerald, 457 U.S. 800, 809 (1982) (quotations omitted), a
government official defendant may obtain qualified immunity if: (1) taken in the
light most favorable to plaintiff, the official’s conduct did not “violate[] a
constitutional right;” or (2) “[t]he contours of the right [were not] sufficiently
clear that a reasonable official would understand that what he is doing violates
that right.” Saucier v. Katz, 533 U.S. 194, 201–02 (2001). Qualified immunity is
not meant to protect those who are “plainly incompetent or those who knowingly
violate the law.” Taylor v. Barkes, 135 S.Ct. 2042, 2044 (2015) (quoting
Ashcroft v. al-Kidd, 563 U.S. 731, 743 (2011)). The “touchstone” of the qualified
immunity analysis is reasonableness. Anderson v. Creighton, 483 U.S. 635, 639
(1987).
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 24 of 35
Response to Motion to Dismiss – Page 25
In Lanuza, the Court of Appeals held there was no qualified immunity for
an official who falsifies documents in immigration proceedings. Lanuza, 899 F.3d
at 1034. For the same reasons, Reyes and Cree cannot assert qualified immunity
against allegations that they conducted a woefully insufficient investigation and
then made false accusations in the AOTR with the purpose and intent of retaliating
against Plaintiffs for criticizing the BIA’s failure to protect children in its care,
having perceived adversaries removed from tribal government, and influencing
the outcome of tribal legislative processes. No reasonable federal official could
have believed that such conduct was lawful or constitutional. The doctrine of
qualified immunity does not apply in this case.
D. PLAINTIFFS STATE A CLAIM FOR THEIR NEGLIGENCE-BASED CLAIMS.
1. Plaintiffs have alleged the existence of duties.
Defendants assert that Plaintiffs’ negligence claims fail because Plaintiffs
“identify no specific duty owed to them that would give rise to a cause of action
for damages.” (Dkt. 14 at 18). This argument is without merit. Plaintiffs
specifically allege duties arising from treaties, the Contract, and the common
law.
First, Defendants owed Plaintiff a general duty of care under the FTCA.
Also, The Contract provides for “routine monitoring visit[s]” and reaffirms the
trust responsibility owed to the Crow Tribe. (Dkt. 4, Ex. A at 9-10).
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 25 of 35
Response to Motion to Dismiss – Page 26
Additionally, every contract, regardless of type, contains an implied covenant of
good faith and fair dealing.” Story v. Bozeman, 791 P.2d 767, 775 (1990),
overruled on other grounds, Arrowhead Sch. Dist. No. 75 v. Klyap, 79 P.3d 250
(Mont. 2003). A covenant of good faith requires “honesty in fact and the
observance of reasonable commercial standards of fair dealing in the trade.”
Mont. Code Ann. § 28-1-211. As discussed above, the Constitution prohibits the
government from unreasonably interfering with free speech and imposes on the
government a duty to employ due process. U.S. Const. Amend. I, V.
On top of these duties, the federal government possesses a “distinctive
obligation of trust” in its dealings with Indian people. Seminole Nation v. United
States, 316 U.S. 286, 297 (1942). The United States’ fiduciary responsibilities
toward Indian Tribes applies to actions of the federal government. Nance v.
E.P.A., 645 F.2d 701, 711 (9th Cir. 1981). Nonetheless, Defendants assert this
obligation “without more, [] does not create a cause of action for breach of a
fiduciary duty that would entitle Plaintiffs to monetary damages.” (Dkt. 14 at 18
(quoting Tsosie ex rel. Estate of Tsosie v. U.S., 441 F. Supp. 2d 1100, 1105
(D.N.M. 2004)).
Defendants fail to recognize that, in this case, there is “more”. There is the
Contract, the implied covenant of good faith and fair dealing, the FTCA, and the
United States Constitution. For reasons discussed throughout this brief and as
alleged in the Complaint, these contractual, common law, statutory, and
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 26 of 35
Response to Motion to Dismiss – Page 27
constitutional obligations imposed on Defendants a duty to conduct their review
and prepare the AOTR in good faith. Plaintiffs have also alleged a common law
and constitutional duty to refrain from retaliating against Plaintiffs for criticizing
the BIA’s failure to protect children in its care, having perceived adversaries
removed from tribal government, and influencing the outcome of tribal legislative
processes. This duty is clearly alleged in the Complaint, and Defendants’ assertion
that Plaintiffs have failed to allege a duty are without merit.
With respect to the duties alleged in the Complaint that arise from the
Contract, Plaintiffs also have standing to assert breach of the obligations created
thereby as agents of the signatory, the Crow Tribe, at the time of executing the
Contract. See Westra v. Marcus, 129 Cal. App. 4th 759, 767 (Cal. Ct. App. 2005)
(holding agent of signatory to agreement had standing to compel other signatory
to arbitration); Peeler v. Rocky Mountain Log Homes Can., Inc., 431 P.3d 911
(Mont. 2018) (citing Westra with approval).
2. Plaintiffs have alleged breaches of the duties alleged.
Defendants argue Plaintiffs have failed to allege breach of a duty because
“the Report findings were accurate both legally and factually.” (Dkt. 14 at 19).
This argument wholly disregards the controlling standards at the motion to dismiss
stage of the proceedings. See Iqbal, 556 U.S. at 678; Twombly, 550 U.S. at 570.
Plaintiffs have alleged the Report findings were neither legally nor factually
correct. (Dkt. 4). In fact, Plaintiffs have alleged the falsity of the AOTR in detail
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 27 of 35
Response to Motion to Dismiss – Page 28
(dkt. 4 at 10-22), and those allegations must be taken as true at this stage.
Disregarding the controlling standards, Defendants assert “Plaintiffs can
only plausibly allege that the Report findings regarding loans to Tribal Court
employees led to Plaintiffs’ terminations.” (Dkt. 14 at 30). However, as alleged in
the Complaint, all the accusations levelled against Plaintiffs caused economic
harm, damage to reputation, and emotional damages. That the Ethics Board
ultimately relied on the loans only is of no moment – as alleged in the Complaint,
the entire AOTR constituted an attack on Plaintiffs’ character that led to their
termination.
Defendants further argue the loans, even if justified by circumstances, were
unlawful, citing the Ethics Board’s conclusion to that effect. (Dkt. 14 at 20).
However, Plaintiffs have argued that the Ethics Board proceeding was
contaminated by Defendants’ actions from the outset. (Dkt. 4 at 22-24). The
proceeding was commenced when Defendants told the Chairman and Vice-
Chairman to have Plaintiffs terminated, or else have the Contract cancelled. (Dkt. 4
at 22). Then the petition filed for that purpose recited the false allegations in the
AOTR and listed the individual Defendants as witnesses. (Dkt. 4 at 22). To cite the
Ethics Board conclusions as dispositive under these circumstances is circular,
seeking to exonerate Defendants on the ground that they prevailed in their plot.
This argument cannot be accepted at this stage in the proceedings. See Iqbal, 556
U.S. at 678; Twombly, 550 U.S. at 570.
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 28 of 35
Response to Motion to Dismiss – Page 29
The Defendants further argue the Tribal Court was required to work with the
Executive Branch to ensure Contract requirements were met. However, Plaintiffs
have alleged they did work with the Executive Branch, alleging that there was no
concealment of the account at issue, that “[t]he Court Administrator communicated
on a regular basis with BIA AOTR, Crow Tribal Finance, the Crow Tribal
Chairman, and the Chief Judge” regarding Tribal Court finances in general, and
that Crow Tribal Finance was specifically notified of the account at issue in a
November 16, 2016 memorandum. (Dkt. 4 at 11-12). Again in contradiction to the
controlling standards, Defendants ask the Court to misconstrue the plain
allegations in Plaintiffs’ Complaint as assertions that the Tribal Court had “carte
blanche” to track and administer funds independently. (Dkt. 14 at 22). This is
simply not an accurate representation of the contents of the Complaint. (Dkt. 4 at
11-12).
Defendants argue that Plaintiffs misconstrue the findings and “provide post-
hoc justifications for the deficiencies” asserted in the AOTR. (Dkt. 14 at 22-23).
This argument again mischaracterizes the Complaint. Plaintiffs argued that, not
only are the factual assertions inaccurate, but the entire review process was
“woefully inadequate” and Cree and Reyes “failed to seek or consider
documentary evidence and controlling law” that would have contradicted their
findings. (Dkt. 4 at 5). Plaintiffs do not rely on post-hoc justifications. They
specifically allege that a competent investigation would have revealed exonerating
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 29 of 35
Response to Motion to Dismiss – Page 30
evidence had such an investigation been conducted. The failure to conduct such an
investigation is at the root of Plaintiffs’ claims. Defendants’ argument that “the
BIA did not make any misrepresentation of fact or opinion, but made accurate
observations consistent with laws and fact” is an argument to be made to the jury,
not one to be determined on a Fed. R. Civ. P. 12(b)(6) motion. (Dkt. 14 at 23).
3. Plaintiffs have alleged causation.
Plaintiffs have specifically alleged that Defendants’ actions caused their
injuries. Nonetheless, Defendants argue Plaintiffs have failed to plead causation
because they do not allege that Reyes or Cree were involved in the meeting with
the Chairman and Vice-Chairman, and they do allege that an intervening action,
the filing of the petition with the Ethics Board, in fact caused Plaintiffs’ alleged
injuries. (Dkt. 14 at 23-25). This argument is flawed.
First, it ignores the fact that the United States is a named Defendant in this
action. Whether Reyes, Crees, or some other agent was present at the meeting is
immaterial – clearly a United States agent was there. Furthermore, it is clearly
alleged that the meeting was prompted by the AOTR, and the AOTR was used to
bring about Not Afraid’s termination.
Furthermore, Defendants misapply basic causation principles. The issue is
not whether an intervening event caused Plaintiffs’ injury. Rather, the issue is
whether an unforeseeable intervening event caused Plaintiffs’ injury. The Ninth
Circuit has held in analogous circumstances that the requisite causal chain can
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 30 of 35
Response to Motion to Dismiss – Page 31
occur through the “setting in motion [of] a series of acts by others which the actor
knows or reasonably should know would cause others to inflict the constitutional
injury.” Harris v. Roderick, 126 F.3d 1189, 1196 (9th Cir.1997)Similarly, the
Montana Supreme Court has held “[f]oreseeable actions do not break the chain of
causation.” Covey v. Brishka, 445 P.3d 785 (Mont. 2019).
Plaintiffs alleged that, in preparing the AOTR, Defendants “acted with
intent to cause Plaintiffs ultimately to lose their positions in Tribal Court”, and
that Plaintiffs’ termination “was the direct result of the aforementioned
machinations”, referencing Defendants actions in conducting an inadequate
review, making false accusations in the AOTR, and sending agents to meet with
the Chairman to pressure him to seek Plaintiffs’ termination. (Dkt. 4 at 25). Far
from being unforeseeable, Plaintiffs’ allege that their termination was a
motivating force behind Defendants’ actions from the outset. Because Plaintiffs’
termination was a foreseeable result of Defendants’ actions, and Defendants’
actions commenced a chain of causation leading to Plaintiffs’ termination, the
causation element has been adequately pled. Defendants’ argument to the contrary
improperly asks the Court to treat Plaintiffs’ allegations as untrue and draw all
inferences against Plaintiffs.
E. PLAINTIFFS HAVE ADEQUATELY ALLEGED CONSTRUCTIVE FRAUD AND BREACH OF THE IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING.
Defendants’ attacks on Plaintiffs’ claims for constructive fraud and breach
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 31 of 35
Response to Motion to Dismiss – Page 32
of the implied covenant of good faith and fair dealing are premised largely on the
incorrect assertions discussed hereinabove. (Dkt. 14 at 25-27). As set forth above,
Plaintiffs have alleged the existence of duties owed to them personally, and thus
can and do make out a prima facie case of constructive fraud.
Additionally, contrary to Defendants’ assertions, Plaintiffs are not required
to allege personal reliance in order to make out a claim for constructive fraud. See
Bixby v. KBR, Inc., 893 F. Supp. 2d 1067, 1087 (D. Or. 2012). In Bixby, members
of the Oregon National Guard were injured when other military officials’ relied
upon misrepresentations from a private company about the hazards posed by
sodium dichromate. Id. That court rejected an argument similar to that made by
Defendants here, holding that the plaintiffs adequately pled reliance by alleging
that they were foreseeably harmed by the defendant’s fraudulent representations
to other agents of the same entity, i.e. the National Guard, regardless of the fact
that they did not personally rely on any misrepresentations. Id. Likewise,
Plaintiffs here have alleged they were injured by Defendants’ misrepresentations
to other members of the Crow Tribal Government. Pursuant to Bixby, this satisfies
the reliance element at the pleading stage, regardless of the fact that Plaintiffs did
not personally rely on the misrepresentations.
Finally, Defendants argue for dismissal of Plaintiffs’ claim for breach of the
implied covenant because Plaintiffs have failed to allege a contractual relationship
with Defendants. (Dkt. 14 at 26-27). As set forth above, Plaintiffs have adequately
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 32 of 35
Response to Motion to Dismiss – Page 33
pleaded breach of the implied covenant of good faith and fair dealing by alleging
they were agents of a signatory at the time of the breach. See Westra, 129 Cal.
App. 4th at 767; Peeler, 431 P.3d 911.
CONCLUSION
For the foregoing reasons, Plaintiffs respectfully requests that the Court deny
Defendants’ motion to dismiss. Alternatively, Plaintiffs request leave to amend in
the event the Court deems Defendants’ arguments for dismissal to have merit.
Dated this 17th day of January 2020.
Respectfully submitted,
/s/ Terryl T. Matt
MATT LAW OFFICE Terryl T. Matt, Esq. 310 East Main Cut Bank, MT 59427 Telephone: (406) 873-4833 Fax No.: (406) 873-4944 terrylm@mattlawoffice.com
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 33 of 35
Response to Motion to Dismiss – Page 34
CERTIFICATE OF COMPLIANCE
Pursuant to D. Mont. L.R. 7.1(d)(2), I certify that:
This brief complies with the type-volume limitation of D. Mont. L.R.
7.1(d)(2) because this brief contains 6,438 words, excluding the parts of the brief
exempted by D. Mont. L.R. 7.1(d)(2)(E).
This brief has been prepared in a proportionately spaced typeface using
Microsoft Word Times New Roman 14-point font.
Date: January 17, 2020.
Respectfully submitted,
/s/ Terryl T. Matt
MATT LAW OFFICE Terryl T. Matt, Esq. 310 East Main Cut Bank, MT 59427 Telephone: (406) 873-4833 Fax No.: (406) 873-4944 terrylm@mattlawoffice.com
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 34 of 35
Response to Motion to Dismiss – Page 35
CERTIFICATE OF SERVICE
I hereby certify that the foregoing document was served upon the following
counsel of record, by ECF Electronic Filing, this 17th day of January, 2020:
VICTORIA L. FRANCIS TYSON M. LIES Assistant U.S. Attorneys U.S. Attorney’s Office 2601 2nd Ave. N., Suite 3200 Billings, MT 59101 Email: victoria.francis@usdoj.gov tyson.lies@usdoj.gov
/s/ Terryl T. Matt
MATT LAW OFFICE Terryl T. Matt, Esq. 310 East Main Cut Bank, MT 59427 Telephone: (406) 873-4833 Fax No.: (406) 873-4944 terrylm@mattlawoffice.com
Case 1:19-cv-00100-SPW-TJC Document 20 Filed 01/17/20 Page 35 of 35
top related