No. 96-7565 IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 1996 LARRY B. WILLIAMS AND KAREN ANN WILLIAMS, PETITIONERS v. UNITED STATES OF AMERICA, ET AL. ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT BRIEF FOR THE FEDERAL RESPONDENTS IN OPPOSITION WALTER DELLINGER Acting Solicitor General FRANK W. HUNGER Assistant Attorney General BARBARA L. HERWIG MARK C. NILES Attorneys Department of Justice Washington, D.C. 20530 ---------------------------------------- Page Break ---------------------------------------- QUESTIONS PRESENTED 1. Whether petitioners' Federal Tort Claims Act and Bivens claims were timely filed. 2. Whether dismissal with prejudice of petitioners' Federal Tort Claims Act claims for failure to exhaust administrative remedies was in error. (I) ---------------------------------------- Page Break ---------------------------------------- In the Supreme Court of the United States OCTOBER TERM, 1996 No. 96-7565 LARRY R. WILLIAMS AND KAREN ANN WILLIAMS, PETITIONERS v. UNITED STATES OF AMERICA, ET AL. ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT BRIEF FOR THE FEDERAL RESPONDENTS IN OPPOSITION OPINIONS BELOW The order of the court of appeals (Pet. App. A-1) is unpublished. The order of the district court (Pet. App. B-1) is unpublished. JURISDICTION The judgment of the court of appeals was entered on May 30, 1996. A petition for rehearing was denied on August 22, 1996. Pet . App. C-2. The petition for a writ of certiorari was filed on November 20, 1996. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1) . ---------------------------------------- Page Break ---------------------------------------- 2 STATEMENT 1. Petitioners formerly operated a 1000-acre farming and cattle operation in Arkansas. Beginning in 1977, they received series of loans from the Farmers Home Association (FmHA) totalling more than $1 million. Petitioners pledged their realty, home, timber and cattle as collateral. The business was not profitable, however, and petitioners sold some of the cattle they had pledged as collateral. William v. Lynq, No. 85-4120 (W.D. Ark. June 12, 1989). By February 1984, the FmHA had concluded that petitioners' financial situation was precarious, and FmHA notified petitioners that no further loans would be made. Petitioners sought to challenge that determination by filing suit under Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, 402 U.S. 396 (1971), alleging due process violations. Judgment was entered in defendants' favor in that suit in June, 1989. See Lyng, supra. Meanwhile, petitioners fell behind on repayment of their FmHA debt. On September 17, 1986, FmHA formally notified them that they were in default, and on January 29, 1987, the United States began foreclosure proceedings. In June 1990, judgment was entered in favor of the United States for approximately $1.231 million. Petitioners were unable to satisfy the judgment. On October 4, 1990, the realty that partially secured the debt sold . See Lynq, supra. ---------------------------------------- Page Break ---------------------------------------- 3 Investigation into petitioners' sale of cattle and timber had been pledged as collateral revealed that petitioner Larry Williams had diverted the proceeds of those sales to his own use. Williams was indicted and, in August 1990, convicted on eight felony counts. He was sentenced to 33 months' imprisonment. See United States v. Williams, 935 F.2d 1531 (8th Cir. 1991) . 2. On October 29, 1992, petitioners filed this action in the United States District Court for the District of Columbia alleging constitutional and common law tort counts (including violation of due process and tortious misuse of civil and criminal process) against various federal officials, and private persons who purchased the realty. Petitioners alleged, in essence, that respondent federal officials failed to comply with Agricultural Credit Act regulations requiring advance notice to delinquent farmer-borrowers prior to taking adverse actions against them, see 7 C.F.R. 1951.901-1951. 909, and that the alleged failure of notice led to a denial of certain benefits that might have been available to them under the Agricultural Credit Act. Petitioners alleged that, had those benefits been available to them, petitioners might not have had to sell cattle and timber in an effort to meet operating expenses, petitioner Larry Williams accordingly would not have been convicted of felonies relating to that conduct, and petitioners would not have lost their farm in the foreclosure sale. See Pet. App . B-2 at 5- 6. ---------------------------------------- Page Break ---------------------------------------- 4 On January 11, 1994, the district court granted in part the federal defendants' motion to dismiss. Pet. App. B-3. The court substituted the United States as defendant to the common law torts and dismissed those claims as to the individual federal officials; dismissed constitutional claims against the officials in their official capacities as barred by sovereign immunity; dismissed a claim based on denial of an administrative appeal as barred by absolute immunity; and, in view of the absence of respondent superior liability under Bivens, dismissed individual- capacity claims against three supervisory officials for want of any allegations of direct participation by those individuals. Id. at 2-4. The court then held that it lacked personal jurisdiction over the remaining individual respondents and that the District of Columbia was not the proper venue, and transferred the case to the Western District of Arkansas. Id. at 5-6, 8. On March 5, 1996, the district court for the Western District of Arkansas, adopting a magistrate judge's report and recommendation, granted the defendants' motion to dismiss the remainder of the claims. Pet. App. B-1. 1 The Bivens claims were dismissed as time-barred under the three-year personal injury statute of limitations applicable to constitutional tort claims . Pet . App . B-2 at 5-13. "A careful reading of the ___________________(footnotes) 1 The Arkansas district court, by orders dated November 23, 1994, March 14, 1995, and October 26, 1995, had dismissed all claims against several other defendants. Pet. App. B-2 at 4 & n.4. ---------------------------------------- Page Break ---------------------------------------- 5 [petitioners'] Complaint indicates that, no later than March of 1989, the plaintiffs knew or, in the exercise of reasonable diligence, should have known the cause and existence of their injury. " Id. at 13. To be timely, the complaint thus would have had to be filed by March 1992, but it was not filed until October 29, 1992. Ibid. The FTCA claims were dismissed for failure to exhaust administrative remedies. Pet . App . B-2 at 13-17. Petitioners acknowledged that they failed to exhaust, but asserted that their failure to do so should be excused. See id. at 15. The court dismissed the state law claims against the private defendants both for want of pendent jurisdiction, and because those claims were frivolous under 28 U.S.C. 1915(d). Pet . App . B-2 at 17-21. The court of appeals summarily affirmed. Pet. App. at A-1. ARGUMENT The decision of the court of appeals is correct, and does not conflict with any decision of this Court or any other court of appeals. Petitioners' claims are entirely fact-bound, and do not warrant review. 1. Petitioners contend (Pet. 13-18) that their claims should not have been dismissed as time-barred. Although their complaint alleged that by March 1989 they had been denied the benefits they sought under the Agricultural Credit Act, petitioners assert that the limitations period should not have started to run until they had experienced all the harms, ---------------------------------------- Page Break ---------------------------------------- 6 including the foreclosure sale on their property on October 4, 1990, which they allege ultimately resulted from the denial of those benefits. They further assert that a "mailbox rule" should have been applied to determine when they filed their complaint. The district court correctly applied the relevant claim accrual rules to hold that petitioners' claims accrued by early March 1989. The complaint was thus more than seven months late. Petitioners suggest that the October 29, 1992 complaint should have been deemed to have been filed on October 2, 1992, when petitioners assert Larry Williams placed it in the hands of prison authorities. Given that the complaint was months, not days, late, no application of a mailbox rule could cure its untimeliness. 2. Petitioners further assert (Pet. 18) that dismissal of their FTCA claim due to their acknowledged failure to exhaust administrative remedies, as required by 28 U.S.C. 2675(a), should have been without prejudice to their right to re-file that claim with the appropriate agency or agencies. Petitioners contend that the district court's dismissal of their claim with prejudice prevented them from benefiting from the 60-day re-filing window provided by 28 U.S.C. 2679(d) (5). Section 2679(d) (5) provides that, following the dismissal of an FTCA action for failure first to present the claim to the appropriate agency for administrative review, the claimant will have 60 days from the date of dismissal to file an administrative claim. That provision applies, however, only if the administrative claim would have been timely ---------------------------------------- Page Break ---------------------------------------- 7 had it been filed on the date the civil action was filed. 28 U.S.C. 2679(d)(5)(A). The civil action in this case was filed more than two years after petitioners' claim accrued, and consequently an FTCA administrative claim filed on that date would have been time barred under the applicable two-year statute of limitations, See 28 U.S.C. 2401(b). CONCLUSION The petition for writ of certiorari should be denied. Respectfully submitted. WALTER DELLINGER Acting Solicitor General FRANK W. HUNGER Assistant Attorney General BARBARA L. HERWIG MARK C. NILES Attorneys MARCH 1997