MCNEIL v. SOCIAL SECURITY ADMINISTRATION

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

:

TRACY MCNEIL, :

:

Plaintiff, : CIVIL ACTION

:

v. : NO. 21-2208

:

SOCIAL SECURITY :

ADMINISTRATION, et al., :

:

Defendants. :

MEMORANDUM

Tucker, J. August 2, 2022

Before the Court are: (1) Motions to Dismiss filed by the Social Security Administration,

United States Department of Treasury, Andrew Saul, John Morenz, Janet Yellen, and Steve

Mnuchin (collectively, “the Federal Defendants”) (ECF Nos. 51 and 52); (2) Plaintiff’s Response

in Opposition to the Motions (ECF No. 55); (3) the Federal Defendants’ Replies in Support of

the Motions (ECF Nos. 57 and 58); and (4) the Parties’ letters to the Court dated May 4, 2022

and June 10, 2022.

For the reasons set forth below: (1) the Federal Defendants’ Motions to Dismiss (ECF

Nos. 51 and 52) are GRANTED; and (2) Plaintiff’s claims against the Federal Defendants are

DISMISSED WITH PREJUDICE.

I. FACTUAL AND PROCEDURAL HISTORY

Tracy McNeil (“Plaintiff”) commenced this action against the United States Social

Security Administration (the “SSA”), the Department of Treasury (“Treasury”), Andrew Saul

(the former Commissioner of the SSA), John Morenz (an Associate Commissioner of the SSA),

Janet Yellen (the Secretary of the Department of Treasury), Steve Mnuchin (the former Secretary

of Treasury), and three private contracting companies: (1) Northrop Grumman Systems

Corporation; (2) Leidos Holdings, Inc.; and (3) Identity Theft Guard Solutions, Inc. (f/k/a “ID

Experts”). This suit pertains to the federal government’s erroneous handling of Plaintiff’s

identity-related data and its resulting effects.

All Defendants filed Motions to Dismiss Plaintiff’s claims, and the Court resolved the

private Defendants’ motions on March 24, 2022. The Court denied Northrop Grumman Systems

Corporation and Leidos Holdings, Inc.’s Motions to Dismiss without prejudice and directed both

Defendants and Plaintiff to conduct limited jurisdictional discovery. Further, the Court granted

Identity Theft Guard Solutions, Inc.’s Motion to Dismiss and dismissed the company from this

suit. Accordingly, this Memorandum addresses the Federal Defendants’ respective Motions to

Dismiss.

For the sake of clarity, the Court herein adopts relevant portions of its previous recitation

of the facts in its March 24th Order:

The factual basis for this dispute stems from Plaintiff learning—

amidst the onset of the Covid-19 crisis—that federal government

records incorrectly classified her as deceased. A Social Security

Administration (SSA) employee advised Plaintiff that her Social

Security Number was deactivated and added to the SSA’s “Death

Master File,” which is a public record of death information. The

agency erroneously documented Plaintiff as having died on

November 11, 2019—the date of Plaintiff’s mother’s death. By this

time, the SSA already disseminated this inaccurate information to

other federal agencies and private businesses, including her bank.

On several occasions, Plaintiff was advised that the mistaken

reporting was removed from the SSA’s Death Master File and the

issue was resolved. Notably, Plaintiff received a letter dated April

30, 2020 from the SSA, “c/o Defendant ID Experts.” In the letter,

the SSA confirmed that Plaintiff was wrongfully classified as

deceased, apologized for creating this problem, and assured her that

the problem was fixed. Therefore, Plaintiff proceeded with the

understanding that she would not experience any further issues.

Unfortunately, the downstream effects of this problem persisted.

Despite being informed that she was no longer misclassified,

Plaintiff experienced issues obtaining Covid-19 relief and accessing

other benefits. In particular: (1) she did not receive stimulus checks

from the December 2020 and March 2021 Covid-19 relief packages;

(2) she was not able to file her income taxes, as the IRS also

classified her as deceased; and (3) for six months, she could not

enroll in a healthcare plan, leaving her uninsured for part of the

pandemic.

See ECF No. 59 (internal citations omitted).

On these grounds, Plaintiff filed a claim for damages under Bivens v. Six Unknown

Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388 (1971) against the Individual

Federal Defendants, alleging a deprivation of Fifth Amendment life and property interests

without due process. Moreover, she seeks injunctive relief from both the Individual Federal

Defendants and the Federal Agency Defendants. In their respective Motions to Dismiss, all the

Federal Defendants assert that Plaintiff has failed to state a claim for which relief can be granted.

In addition, the Federal Agency Defendants contend that the Court has no subject matter

jurisdiction over this case.

II. STANDARD OF REVIEW

A. Rule 12(b)(1)

Federal Rule of Civil Procedure 12(b)(1) provides for the dismissal of an action for lack

of subject matter jurisdiction. Fed. R. Civ. P. 12(b)(1). A Rule 12(b)(1) motion may challenge

jurisdiction based on the face of the complaint—a facial attack—or its existence in fact—a

factual attack. See Gould Elecs. Inc. v. United States, 220 F.3d 169, 176 (3d Cir. 2000) (citing

Mortensen v. First Fed. Savings and Loan Ass’n, 549 F.2d 884, 891 (3d Cir. 1977). A facial

attack contests the sufficiency of the pleadings and the court must view the factual allegations in

the complaint in the light most favorable to plaintiff. Constitution Party of Pa. v. Aichele, 757

F.3d 347, 358 (3d Cir. 2014). In reviewing a facial attack, a court must only consider the

allegations of the complaint and documents referenced therein. “Thus, a facial attack calls for a

district court to apply the same standard of review it would use in considering a motion to

dismiss under Rule 12(b)(6), i.e., construing the alleged facts in favor of the nonmoving party.”

Id.

A factual attack, on the other hand, concerns “the actual failure of [a plaintiff’s] claims to

comport [factually] with the jurisdictional prerequisites.” U.S. ex rel. Atkinson v. Pa.

Shipbuilding Co., 473 F.3d 506, 514 (3d Cir. 2007). “As the party asserting jurisdiction,

[plaintiffs] bear[] the burden of showing that its claims are properly before the district court.”

Dev. Fin. Corp. v. Alpha Hous. & Health Care, Inc., 54 F.3d 156, 158 (3d Cir. 1995). In a

factual attack, a district court may weigh and “consider evidence outside the pleadings.” Gould

Elecs. Inc., 220 F.3d at 176.

B. Rule 12(b)(6)

The purpose of a Rule 12(b)(6) Motion to Dismiss is to test the sufficiency of pleadings.

Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir. 1993). The touchstone of that pleading standard is

plausibility. Bistrian v. Levi, 696 F.3d 352, 365 (3d Cir. 2012). “To survive a motion to dismiss,

a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that

is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citations and quotations

omitted). Facial plausibility requires more than “[t]hreadbare recitals of the elements of a cause

of action, supported by mere conclusory statements.” Id. A plaintiff will not prevail if he

provides only “labels and conclusions.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 545 (2007).

Instead, the plaintiff must detail “enough facts to raise a reasonable expectation that discovery

will reveal evidence of ‘each necessary element of the claims alleged in the complaint.’” Phillips

v. Cnty. of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008) (quoting Twombly, 550 U.S. at 556

(2007)).

Applying the Iqbal and Twombly principles, the Third Circuit decided Santiago v.

Warminster Township, 629 F.3d 121 (3d Cir. 2010), in which it set forth a three-part test that

district courts must apply when evaluating whether allegations in the complaint survive a

12(b)(6) motion to dismiss. A court must: (1) identify the elements of the claim; (2) review the

complaint to strike conclusory allegations; and (3) look at the well-pleaded components of the

complaint and evaluate “whether all the elements identified in part one of the inquiry are

sufficiently alleged.” Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011). If the complaint

fails to do so, the motion to dismiss will be granted.

III. DISCUSSION

A. Bivens Claim Against the Individual Federal Defendants

1. Qualified Immunity

At the outset, the Court notes that the Individual Federal Defendants are entitled to

qualified immunity. Qualified immunity is a defense to Bivens actions, as it “protects a

government official from liability for civil damages as long as his conduct did not violate clearly

established rights of which a reasonable person would have known.” Credico v. Krenitsky, 845 F.

App'x 196, 198 (3d Cir. 2021) (citing Harlow v. Fitzgerald, 457 U.S. 800, 818, 102 S.Ct. 2727,

73 L.Ed.2d 396 (1982)). When a qualified immunity defense is raised on a motion to dismiss, the

Court must assess “whether the complaint contains plausible allegations of a constitutional

violation ... and whether the asserted constitutional right is clearly established.” Karkalas v.

Marks, 845 F. App'x 114, 118 (3d Cir. 2021).

Here, Plaintiff avers that her Fifth Amendment life and property interests were violated

due to the Government’s error. Pl. Resp. in Opp. 19, ECF No. 1. However, the Court finds no

indication that accurate classification in Government records—and its associated benefits—

constitute a “clearly established” right. Accordingly, qualified immunity applies to the Individual

Federal Defendants.

2. Extending Bivens to a New Context

Alternatively, even if the Individual Federal Defendants were not entitled to qualified

immunity, Plaintiff’s claims still cannot proceed. “[A] Bivens claim is brought against the

individual official for his or her own acts, not the acts of others.” Ziglar v. Abbasi, 137 S. Ct.

1843, 1860, 198 L. Ed. 2d 290 (2017). That is, “a plaintiff must plead that each Government-

official defendant, through the official's own individual actions, has violated the Constitution.”

Iqbal, 556 U.S. at 676 (emphasis added). Here, Plaintiff’s Complaint is devoid of any allegations

specifically tying any of the Individual Federal Defendants to the alleged harms. On this basis

alone, Plaintiff fails to state a claim for relief.

And again, even if Plaintiff did sufficiently plead that the Individual Federal

Defendants—via their own actions—violated the Constitution, the Court still could not afford

her any recourse vis-à-vis Bivens. In Bivens, the Supreme Court found “an implied right of action

for damages against federal officers alleged to have violated a citizen’s constitutional rights.”

Hernandez v. Mesa, 137 S.Ct. 2003, 2006 (2017) (citation omitted). Since then, the Supreme

Court has only recognized two additional causes of action under a Bivens claim. See Davis v.

Passman, 442 U.S. 228 (1979) (permitting a Bivens remedy in a Fifth Amendment gender

discrimination case); see also Carlson v. Green, 446 U.S. 14 (1980) (permitting a Bivens remedy

in an Eighth Amendment cruel and unusual punishments clause case). In fact, the Supreme Court

has established that “expanding the Bivens remedy is now a disfavored judicial activity.” Ziglar,

137 S. Ct. at 1857 (internal quotations omitted). Respecting the importance of separation of

powers between the judicial and legislative branches of government, the Supreme Court advised

lower courts to refrain from implying causes of actions under Bivens in the absence of statutory

authority—that is Congress’ responsibility. Id. at 1856.

Traditionally, courts applied a two-part test to determine the appropriateness of extending

a Bivens cause of action. First, the Court examined whether the claim arises in a “new context”

or involves a “new category of defendants.” Hernandez v. Mesa, 140 S. Ct. 735, 743, 206 L. Ed.

2d 29 (2020). Second, if the claim does indeed arise in a new context, the Court assessed whether

there exists any “special factors counselling hesitation in the absence of affirmative action by

Congress.” Ziglar, 137 S. Ct. at 1857 (internal quotations omitted). However, the Supreme Court

recently reformulated this test. In Egbert v. Boule, 142 S.Ct. 1793, 1803 (2022), the Supreme

Court determined that these two steps can be distilled to one single inquiry; that is, “whether

there is any reason to think that Congress might be better equipped to create a damages remedy.”

Further, the Court specified that if there is even one rational reason to defer to Congress to afford

a remedy, then “a court may not recognize a Bivens remedy.” Id. Practically, the Court

concluded that a rational reason for deference to Congress will exist “in most every case.” Id.

Finally, the presence of an alternative remedial structure counsels against extending

Bivens to a new cause of action. To be sure, the Court may not even determine the adequacy of

the alternative remedy, as this too is a task left to Congress. Id. at 1807. Indeed, “[s]o long as

Congress or the Executive has created a remedial process that it finds sufficient to secure an

adequate level of deterrence, the courts cannot second-guess that calibration by superimposing a

Bivens remedy.” Id. This remains true “even if a court independently concludes that the

Government’s procedures are ‘not as effective as an individual damages remedy.’” Id. (quoting

Bush v. Lucas, 462 U.S. 367, 372 (1983)).

Here, the Parties dispute whether Plaintiff can make a viable Bivens claim against the

Individual Federal Defendants for the misclassification of her vital status and subsequent failure

to correct this record within a desired timeframe. The Individual Federal Defendants do not

challenge Plaintiff’s allegations of misclassification, rather, they argue that there is no basis for

providing a Bivens cause of action, particularly in light of the Supreme Court’s recent holding in

Egbert. The Court agrees.

Plaintiff seeks damages under Bivens, yet alternative relief is afforded by the Privacy Act

of 1974, 5 U.S.C. § 552a(d)(2). Under the statute, individuals must request the amendment of

records from a federal agency and may only seek judicial review if the agency makes a final,

adverse agency decision. Plaintiff states that the Individual Federal Defendants’ assertion that

there is an administrative remedy available “border[s] on offensive,” given the “shocking amount

of effort” it took to fix this issue. Pl. Resp. in Opp. 11, ECF No. 55. She highlights that she

enlisted the help of numerous people, including staffers at her own US Representative’s office.

Id. The record evidence submitted with the Parties’ briefings does evince Plaintiff’s tiresome

efforts to resolve this matter. Still, these efforts do not negate the fact that an opportunity for

recourse under the Privacy Act of 1974 was available. Additionally, to the extent that Plaintiff

still contests the amount of funds that the IRS should have disbursed to her, she can initiate a tax

refund suit against the agency, pursuant to 26 U.S.C § 7422.

The Court does not trivialize the consequences suffered by Plaintiff due to the

Government’s misclassification, as well as the apparently arduous process Plaintiff undertook to

correct the errors. But as a matter of law, these unfortunate circumstances are insufficient to

extend Bivens to this new context. The existence of alternative remedies indicates that Congress

has likely contemplated allowing a damages remedy for record misclassification and perhaps

decided against it. Congress instead provided alternative remedies to address such issues, as well

as an opportunity for judicial review in cases of adverse final actions. The fact that Plaintiff

deems the remedies unsatisfactory is irrelevant to a Bivens inquiry. Accordingly, the Court

declines to create a new Bivens cause of action and dismisses this claim against the Individual

Federal Defendants with prejudice.

B. Claim for Injunctive Relief Against all Federal Defendants

Plaintiff seeks the following injunctive relief against the SSA, Commissioner Saul, and

Associate Commissioner Morenz:

a. assurance that any and all records of Plaintiff being deceased

have been removed from the Death Master File;

b. A written letter to each and every federal agency’s office of

legal counsel instructing said agency to properly classify

Plaintiff’s vital status (requested in forthcoming petition for

injunctive relief);

c. A signed statement from SSA for Plaintiff to keep on her person

advising that she had been misclassified as deceased by the

agency, for Plaintiff to have in the event another entity believes

her to be deceased (requested in the forthcoming petition for

injunctive relief); and

d. A detailed report to Plaintiff how her social security number

was misclassified and why the error was not corrected when it was

initially investigated

Pl. Compl. 20, ECF No. 1.

Further, Plaintiff seeks the following injunctive relief against Treasury and

Secretary Yellen:

a. Treasury Defendants should be compelled to issue to Plaintiff

McMeil a $600.00 Covid-relief check from the Bipartisan-

Bicameral Omnibus COVID Relief Deal of December 2020…;

b. Treasury Defendants should be compelled to issue to Plaintiff

McNeil a $1400.00 Covid-relief check from the American Rescue

Plan of 2021 …;

c. Treasury Defendants should refund to Plaintiff any penalty

assessed or levied against her in connection with the late filing of

taxes; and

d. Treasury Defendants should be compelled to affirmatively

demonstrate that any and all records of Plaintiff being deceased have

been removed from the Treasury/IRS’ Individual Master File and

corrected in any and all agency records…

Pl. Compl. 22, ECF No. 1.

1. Injunctive Relief Against the Federal Agency

Defendants

As a threshold matter, Plaintiff’s claim for injunctive relief against the SSA and Treasury

is barred by sovereign immunity. It is well settled that “[a]bsent a waiver, sovereign immunity

shields the Federal Government and its agencies from suit.” F.D.I.C. v. Meyer, 510 U.S. 471,

475, 114 S.Ct. 996, 127 L.Ed.2d 308 (1994). Indeed, “[a] suit against a Federal agency is a suit

against the United States for the purposes of sovereign immunity.” Ginn v. Burroughs, No. CV.

18-3763, 2018 WL 6522928, at *2 (D.N.J. Dec. 11, 2018) (quoting Hines v. Irvington

Counseling Ctr., 933 F. Supp. 382, 388 (D.N.J. 1996)). Moreover, a federal court does not have

subject matter jurisdiction in such cases without an “express and unambiguous” waiver of

sovereign immunity. See Cudjoe ex rel. Cudjoe v. Dep't of Veterans Affs., 426 F.3d 241, 246 (3d

Cir. 2005) (citation omitted). Finally, “[a] party suing the federal government bears the burden of

establishing that the United States has unequivocally waived its immunity from suit.” United

States v. Schiaffino, 317 F. App'x 105, 106 (3d Cir. 2009).

Here, the SSA and Treasury—and by extension, the United States—are entitled to

sovereign immunity and have not consented to suit in this context. Plaintiff’s Response fails to

discuss sovereign immunity at all, let alone any mention of sovereign immunity being waived.

Nor could she successfully make such an argument, as the Supreme Court has held that Bivens

actions cannot be brought against federal agencies. See Meyer, 510 U.S. at 472 (holding that

“[t]he logic of Bivens itself does not support the extension of Bivens from federal agents to

federal agencies.”) (emphasis in original). In the absence of any material possibility that the

agencies’ immunity has been waived, the Court lacks subject matter jurisdiction over this

particular dispute. Consequently, the Court dismisses Plaintiff’s claims for injunctive relief

against the SSA and Treasury with prejudice.

2. Injunctive Relief Against the Individual Federal

Defendants

Plaintiff’s claims for injunctive relief cannot proceed against the Individual Federal

Defendants as well, because such relief is unavailable in Bivens actions. “Bivens suits are only

actionable when the plaintiff sues federal officials for monetary damages.” Johnson v. U.S.

Magistrate Susan P. Baxter, No. 1:16-CV-00059, 2016 WL 6892928, at *5 (W.D. Pa. Aug. 4,

2016) (citing Butz v. Economu, 438 U.S. 478, 504-05 (1978)) (emphasis added). It is unclear

whether Plaintiff’s request for injunctive relief is brought pursuant to Bivens, however: (1)

Bivens is the only legal authority referenced in the entire Complaint that she contends the Federal

Defendants violated; and (2) Plaintiff expressly states in her Response that she is not bringing

her claim under the CARES Act or the Administrative Procedures Act. Pl. Resp. in Opp. 19,

ECF No. 55. Thus, to the extent that the request for equitable relief does indeed rely on alleged

Bivens violations, it must be denied.

IV. CONCLUSION

For the foregoing reasons, IT IS HEREBY ORDERED AND DECREED that: (1) the

Federal Defendants’ Motions to Dismiss (ECF Nos. 51 and 52) are GRANTED; and (2)

Plaintiff’s claims against the Federal Defendants are DISMISSED WITH PREJUDICE.

An appropriate Order follows.