Opinion
Civil Action No. 03-cv-4322.
October 14, 2004
Beverly M. Wurth, Esq., CALO AGOSTINO, PC, Hackensack, NJ, Counsel for Plaintiff.
Christopher J. Christie, Esq., UNITED STATES ATTORNEY, by Peter G. O'Malley, Esq., OFFICE OF THE UNITED STATES ATTORNEY, Newark, NJ, Counsel for Defendant United States.
Hayden Smith, Jr., Esq., McCARTER ENGLISH, LLP, Newark, NJ, Counsel for Defendants Richard W. Hill, Esq. and R.H. Research, Inc.
OPINION
Filomena Peloro filed this action seeking return of three bearer securities (the "Bearer Bonds") that were seized by the FBI and determined by the bankruptcy court to constitute "customer property" in a Securities Investor Protection Act ("SIPA") liquidation proceeding, as well as legal fees, interest and costs. Presently before the court are two dispositive motions — a motion for summary judgment by Richard W. Hill, Esq. (the "Trustee") and R.H. Research, Inc. ("R.H.") and a motion to dismiss by the United States. For the reasons discussed more fully herein, the court will grant the motion of the Trustee and R.H. because claim and issue preclusion bar the action against them. In addition, because sovereign immunity bars the action against the United States, the court will grant the United States' motion to dismiss.
A security that is in bearer form has no recorded ownership. The person bearing the security is assumed to be the owner. E.g., Bureau of the Public Debt, U.S. Dept. of the Treasury, available at www.publicdebt.treas.gov/cc/ccphony1.htm.
I. BACKGROUND
A. Facts
Plaintiff Filomena Peloro ("Plaintiff" or "Ms. Peloro") maintained at First Interregional Equity Corporation ("FIEC" or the "Debtor") an individual account (the "Individual Account") as well as a joint account in her name and the name of her father, Donato Peloro (the "Joint Account"). On or about October 8, 1996, Ms. Peloro mailed four securities (the "Four Securities") — including the Bearer Bonds in issue here — in an envelope addressed to a Kevin McLaughlin at FIEC's Millburn, New Jersey location. Quantity Description Registration CUSIP
Kevin McLaughlin was Ms. Peloro's FIEC sales representative with respect to both the Individual Account and the Joint Account.
As defined in SIPA, "customer name securities" are securities which are held for a customer's account on the filing date and, because they are registered in the customer's name, are negotiable only by the customer. 15 U.S.C. § 78lll(3).
The liquidation proceeding commenced on March 10, 1997, when the district court, in response to the filing of an application by the Securities Investor Protection Corporation ("SIPC"), entered an order which, inter alia, (1) adjudicated that the customers of FIEC were in need of the protection afforded by the Securities Investor Protection Act, 15 U.S.C. § 78aaa, et seq., ("SIPA"); (2) appointed Richard W. Hill, Esq. as the Trustee for the liquidation of FIEC's business; and (3) ordered the removal of the liquidation proceeding to the United States Bankruptcy Court for the District of New Jersey (the "Bankruptcy Court") pursuant to 15 U.S.C. § 78eee(b)(4).
On May 19, 1997, the Trustee published notice of FIEC's liquidation and mailed notice and claim forms in accordance with the notice provision in 15 U.S.C. § 78fff-2(a)(1) and an order issued by the Bankruptcy Court on May 9, 1997, thereby setting a bar date of November 19, 1997 (the "Bar Date"). The notice was published in the Wall Street Journal, New York Times, Newark Star-Ledger, Miami Herald, Boca Raton News, and Philadelphia Inquirer. The claim packages mailed to Debtor's customers contained, inter alia, information regarding the procedure for filing claims, a customer claim form, a brochure entitled "How SIPA Protects You," and a notice of liquidation. The notice of liquidation contained an advisement that no claims of any kind will be allowed unless filed within six months after the date of the notice. See 15 U.S.C. § 78fff-2(a)(3) (disallowing all claims received after the expiration of the six-month period beginning on the date of the Trustee's publication of the notice). The customer claim form specified that a separate claim form should be filed for each account. The instructions for completing the customer claim form further provided the following information in a section entitled "WHEN TO FILE":
This disallowance provision affords narrow exceptions — none of which are applicable here — for claims filed beyond the bar date by the United States, a state or political subdivision, or an infant or incompetent person.
The bankruptcy court has set July 18, 1997 as the final day for filing customer claims. If your claim is received by the Trustee after July 18, 1997, but on or before November 19, 1997, your claim is subject to delayed processing and to being satisfied on terms less favorable to you.
The law governing this proceeding absolutely bars the allowance of any claim, including a customer claim, not actually received by the trustee on or before [the Bar Date]. Neither the Trustee nor SIPC has authority to grant extensions of time for filing of claims, regardless of the reason. If your claim is received even one day late, it will be disallowed.
The claim package which was mailed to customers specified that a separate claim form should be filed for each account. It is uncontested that actual notice was sent to and received by Ms. Peloro with respect to her Individual Account. In fact, Ms. Peloro filed a timely customer claim with respect to her Individual Account, which the Trustee valued at $993,774.95 and satisfied in full.
In contrast, because there were no positions or activity in Ms. Peloro's Joint Account, the Joint Account did not satisfy the criteria for being mailed a claim package, and information with respect to the Joint Account was not provided to the Trustee for the purpose of mailings to FIEC's customers. On or about July 24, 1997, the FBI returned the Four Securities to the Trustee by forwarding them to R.H., a firm which the Trustee had retained to assist with the liquidation of FIEC. Once the Four Securities had been placed in the care of R.H.'s representatives, they had to be allocated to one of Ms. Peloro's accounts for the purpose of determining customers' claims. Because the three Bearer Bonds were contained in the same envelope as the Customer Name Security, which was registered to Filomena and Donato Peloro, all Four Securities were allocated to their Joint Account.
See 15 U.S.C. § 78fff-2(a)(1) (requiring "notice to be mailed to each person who, from the books and records of the debtor, appears to have been a customer of the debtor with an open account within the past twelve months . . ."). It is uncontested that there were no positions or activity in Ms. Peloro's Joint Account from 1984 through March 6, 1997. Thus, no notice was required with respect to the Joint Account.
In a letter addressed to Ms. Peloro and dated November 10, 1997, the Trustee advised Ms. Peloro to file all claims no later than the Bar Date. However, Ms. Peloro did not file a claim by the Bar Date for the Bearer Bonds or her Joint Account. The Customer Name Security was returned to Ms. Peloro on or about July 21, 1999 pursuant to 15 U.S.C. §§ 78lll(3) and 78fff-2(c)(2), which require the Trustee to return customer name securities to the person in whose name the security is registered. By letter dated October 25, 1999 — almost two years after the Bar Date — Ms. Peloro filed an informal proof of claim for "two bonds." The Trustee denied this claim as untimely.
Because Ms. Peloro's description was not more specific, in his notice of determination of the claim, the Trustee "presumed" that Ms. Peloro was referring to the Ashland and Coleman Securities. Ms. Peloro did not contest or object to this presumption. Thus, the Brevard Security, which is one of the three Bearer Bonds in issue here, was not put in issue before the Bankruptcy Court.
B. The Bankruptcy Court's Decision
On or about June 17, 2003, the Trustee filed a motion to affirm his determination of Ms. Peloro's claim for the Ashland and Coleman Securities as untimely. Ms. Peloro filed an objection to the Trustee's motion. By order dated December 10, 2003 (the "December 10 Order"), Bankruptcy Court Judge Rosemary Gambardella affirmed the Trustee's determination. In the companion oral opinion dated December 3, 2003 (the "December 3 Opinion"), Judge Gambardella found that (1) the Ashland and Coleman Securities were "customer property" as defined under SIPA because they were securities and were sent by Ms. Peloro to FIEC, which received and held them for her account, (2) the Joint Account claim of Ms. Peloro for the Ashland and Coleman Securities was untimely, (3) the Joint Account claim may not be considered an amendment to Ms. Peloro's timely filed Individual Account claim, and (4) the Bankruptcy Court did not have equitable authority to allow the late Joint Account claim. With respect to the six-month bar date, Judge Gambardella explained, "The SIPA time limits are mandatory and may not be extended by the exercise of some equity power." (Tr. Dec. 3 Op. 18.20-.22.) Ms. Peloro's failure to submit a timely claim therefore barred her recovery of the Ashland and Coleman Securities in issue. Ms. Peloro did not appeal the Bankruptcy Court's decision.
"Customer property" means "cash and securities (except customer name securities delivered to the customer) at any time received, acquired, or held by or for the account of a debtor from or for the securities accounts of a customer . . .). 15 U.S.C. § 78lll(4). Any customer property remaining after allocation to SIPC and the Debtor's customers shall become part of the general estate of the debtor. 15 U.S.C. § 78fff-2(c)(1).
C. The Instant Motions
The Trustee proffers the following arguments in support of this motion for summary judgment: (1) this court lacks subject matter jurisdiction because the Bankruptcy Court has exclusive jurisdiction over any suit against the Trustee; (2) Ms. Peloro's amended complaint should be dismissed because it is stayed by statute and by order of this court; and (3) rather than appeal the Bankruptcy Court's December 10 Order, Ms. Peloro pursued the instant action, which is barred by the doctrines of claim and issue preclusion.
Because it is not necessary to the resolution of these motions to discuss the Trustee's stay argument, the court will simply note that any action against the Trustee is stayed pursuant to 15 U.S.C. § 78eee(b)(2)(B)(i) and the March 10 Order.
In support of its motion to dismiss, the United States argues that (1) because it has neither possession nor control over the securities in issue, there is no basis for the action against the United States; and (2) to the extent that Ms. Peloro's claim for conversion refers to the United States, this claim must be dismissed for lack of subject matter jurisdiction due to Ms. Peloro's failure to exhaust administrative remedies as required by the Federal Tort Claims Act.
III. RICHARD W. HILL R.H. RESEARCH, INC.'S MOTION FOR SUMMARY JUDGMENT
A. The scope of district court's jurisdiction over SIPA proceeding
The Trustee and R.H. urge the court to dismiss all claims against them due to lack of subject matter jurisdiction. More specifically, the Trustee argues that pursuant to 15 U.S.C. § 78eee(b)(2)(A) and upon entry of the March 10 Order removing the FIEC liquidation proceeding to the Bankruptcy Court, this court was divested of its exclusive jurisdiction, and sole jurisdiction of any suit against the Trustee thereby became vested in the Bankruptcy Court. This court, however, concludes otherwise after undertaking the following analysis.
To the extent that it would be consistent with SIPA, a SIPA liquidation shall be conducted as though it were a chapter 7 liquidation under title 11. See 15 U.S.C. § 78fff(b). If proceeding arises under, arises in, or is related to cases under title 11, the district court has subject matter jurisdiction and may refer the matter to the bankruptcy court. 28 U.S.C. § 1334(b). See also Securities Investor Protection Corp. v. Cheshier Fuller ( In re Sunpoint Securities, Inc.), 262 B.R. 384, 396 (Bankr. E.D. Tex. 2001). Thus, because a SIPA proceeding arises under title 11, the district court has original subject matter jurisdiction.
Although bankruptcy courts also have jurisdiction over SIPA proceedings, 15 U.S.C. § 78eee(b)(2) (4), bankruptcy courts are courts of limited jurisdiction. Northern Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U.S. 50 (1982). The jurisdiction of bankruptcy courts is wholly grounded in and limited by statute. Celotex Corp. v. Edwards, 514 U.S. 300, 307 (1995). "Because Congress could not have intended to extend a bankruptcy court's jurisdictional reach beyond permissible bounds, Congress did not intend the exclusive jurisdiction provision in 78eee(b) to preclude the litigation of every case involving the SIPA in a forum other than a bankruptcy court." Trefny v. Bear Stearns Securities Corp., 243 B.R. 300, 324 (S.D. Tex. 1999) (finding that the bankruptcy court did not have exclusive jurisdiction to adjudicate the dispute).
In other words, a bankruptcy court has concurrent jurisdiction, not exclusive jurisdiction, to adjudicate claims arising under, arising in or related to cases under title 11, which include SIPA proceedings. Id. (emphasis added). By referring the matter to a bankruptcy court, the district court does not divest itself of jurisdiction. Therefore, the Trustee's argument concerning the exclusivity of the Bankruptcy Court's jurisdiction must be rejected.
B. Summary Judgment Standard
Summary judgment will be granted if the record establishes that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(c). Rule 56(c) imposes a burden on the moving party simply to point out to the district court that there is an absence of evidence to support the nonmoving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986).
Once the moving party has met this burden, the burden then shifts to the non-moving party. She "must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). Moreover, she may not simply "replace conclusory allegations of the complaint or answer with conclusory allegations of an affidavit." Lujan v. National Wildlife Federation, 497 U.S. 871, 888 (1990) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986)). Rather, she must "set forth specific facts showing that there is a genuine issue for trial." Rule 56(e).
At the summary judgment stage, the court's function is not to weigh the evidence and determine the truth of the matter, but rather to determine whether there is a genuine issue for trial. Anderson, 477 U.S. at 249. The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment. Id. at 247. In determining whether there exists a material issue of disputed fact, however, the facts and the inferences to be drawn from the facts are to be viewed in the light most favorable to the nonmoving party. Pollock v. American Tel. Tel. Long Lines, 794 F.2d 860, 864 (3d Cir. 1986). C. The unlawful conversion claim against the Trustee and R.H.
Ms. Peloro's amended complaint alleges that the Trustee and R.H. unlawfully converted the Bearer Bonds when they allocated the Bearer Bonds to her Joint Account and refused to return the Bearer Bonds to her. Because the doctrines of claim preclusion and issue preclusion apply to bar this action, the court will grant summary judgment for the Trustee and R.H.
The doctrine of claim preclusion, also known as res judicata, requires that claims arising out of the same operative facts must be raised together in one action, or else they are waived. In addition to barring those claims that were asserted in the first action, claim preclusion also bars any other claims arising out of that transaction or occurrence that could have been asserted but were not. CoreStates Bank, N.A. v. Huls America, Inc., 176 F.3d 187, 191 (3d Cir. 1999) (affirming the district court's holding that claim preclusion barred a claim that the creditor could have raised along with its other objections to confirmation of the bankruptcy plan). Claim preclusion applies regardless of the type of bankruptcy jurisdiction within which the current claim would fall. Id. Procedurally, an objection to a plan may possess all the hallmarks of a claim. Id. at 201 (providing examples of similarities between an objection and a claim, such as the filing of an objection gives rise to a contested matter). Whether the material facts alleged are the same is a key factor in determining whether claim preclusion applies. Id. at 202. In order for claim preclusion to apply, the following three requirements must be met:
1. The current claim must have been within the jurisdiction of the court hearing the prior bankruptcy proceeding. In order for a claim to fall within the bankruptcy jurisdiction, it must at least be one that "could conceivably have any effect on the estate being administered in bankruptcy." Id. at 191 (citing Pacor, Inc. V. Higgins, 743 F.2d 984, 994 (3d Cir. 1984)).
2. The party to be precluded raised a claim, such as an objection to a reorganization plan, in the prior proceeding. Id.
3. The events underlying the current claim are essentially similar to those underlying the claim made in the bankruptcy proceeding. Id.
In this case, claim preclusion bars the unlawful conversion claim against the Trustee. First, this claim fell within the bankruptcy court's jurisdiction because the issue of whether the Bearer Bonds were unlawfully converted — i.e., whether the bonds belonged to Ms. Peloro — would have clearly had an effect on the amount available in the liquidation proceeding to satisfy customers' claims; for example, a determination that the bonds were unlawfully converted would have correspondingly diminished the amount available for customers' claims. Second, Ms. Peloro raised an objection to the Trustee's motion before the Bankruptcy Court seeking affirmation of his determination denying her time-barred claim. Third, the events underlying the current claim are virtually identical to and not materially different from those underlying the claim made in the bankruptcy proceeding.
Ms. Peloro's Amended Complaint seeks the return of the Brevard Security, which was not claimed in the SIPA liquidation proceeding and not addressed in the Bankruptcy Court's December 3 Opinion or December 10 Order. However, no facts indicate that Ms. Peloro could not have asserted a claim for the Brevard Security in the SIPA liquidation proceeding. Indeed, Ms. Peloro refers collectively to the Bearer Bonds at issue and does not make any material distinction between them. Therefore, claim preclusion also bars her claim for the Brevard Security for the reasons stated above.
In other words, claim preclusion applies because (a) there was final judgment on the merits in the Bankruptcy Court's prior decision affirming the Trustee's determination of Ms. Peloro's untimely claim, (b) the prior bankruptcy proceeding involved the same parties, and (c) the instant action is based on the same cause of action. See id. at 194 (explaining that two suits are based on the same "cause of action" if there is an "essential similarity of the underlying events giving rise to the various legal claims") (citations omitted).
Issue preclusion, which precludes relitigation of issues actually litigated and necessary to the outcome of the first action and is also known as collateral estoppel, also bars relitigation of the same issue against the Trustee. See Parklane Hosiery Co. V. Shore, 439 U.S. 322, 327 n. 5 (1979) (defining claim and issue preclusion). The issue before the Bankruptcy Court was whether the Bearer Bonds in issue constituted "customer property," and the Bankruptcy Court held that they were indeed "customer property," which means that the Bankruptcy Court determined that they were not the property of Ms. Peloro. Here, Ms. Peloro asserts an unlawful conversion claim, which, under New Jersey law, is defined as an unauthorized assumption and exercise of the right of ownership over goods or personal chattels belonging to another, to the alteration of their condition or the exclusion of an owner's rights. E.g., Farris v. County of Camden, 61 F. Supp. 2d 307, 350 (D.N.J. 1999). Proving that property has been converted therefore requires, inter alia, resolution of the issue of which party has the right to possess the property. Because the Bankruptcy Court has already resolved this issue against Ms. Peloro, Ms. Peloro is precluded from rearguing that she has the right to possess the Bearer Bonds.
Although R.H. was not a party to the prior bankruptcy proceeding, the claims against it are also barred by the doctrine of non-mutual issue preclusion. In Blonder-Tongue Laboratories, Inc. V. University of Illinois Foundation, 402 U.S. 313 (1971), the University of Illinois Foundation sued one defendant for infringing a patent and lost on the ground that the patent was invalid; it then brought suit against another defendant for infringement of the same patent. The Supreme Court ruled that the plaintiff was precluded from relitigating the validity of a patent because a federal court in a previous lawsuit had already declared the patent invalid. Id. at 349-350. See also 18A CHARLES ALAN WRIGHT ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 4464 (2d ed. 2004) (noting that lower federal courts have not construed the Court's holding in Blonder-Tongue as limited to patent cases and have applied non-mutual collateral estoppel in a wide variety of cases). Similarly in this case, Ms. Peloro is precluded from relitigating issue of the ownership of the Bearer Bonds because the Bankruptcy Court has already declared that she does not own them but that they are "customer property." Because no facts indicate that Ms. Peloro did not have a full and fair opportunity to litigate this issue in the prior bankruptcy proceeding, preclusion of claims against R.H. is appropriate in this case. See Blonder-Tongue, 402 U.S. at 332-334 (explaining that preclusion is appropriate only if the precluded party had a full and fair opportunity to litigate the issue in the first action).
III. UNITED STATES' MOTION TO DISMISS, OR IN THE ALTERNATIVE, MOTION FOR SUMMARY JUDGMENT
D. Standard of review
In considering a motion to dismiss for failure to state a claim under Rule 12(b)(6), the court is required to accept as true all allegations in the complaint and all reasonable inferences that can be drawn from them after construing them in the light most favorable to the non-movant. Jordan v. Fox, Rothschild, O'Brien Frankel, 20 F.3d 1250, 1261 (3d Cir. 1994). A case should not be dismissed for failure to state a claim unless it clearly appears that no relief can be granted under any set of facts that could be proved consistently with the plaintiff's allegations. Id.
E. Rule 41(g) motion for return of property
Ms. Peloro invokes Federal Rule of Criminal Procedure 41(g) for the return of the Bearer Bonds. Rule 41(g) provides that "[a] person aggrieved by an unlawful search and seizure of property or by the deprivation of property may move for the property's return." FED. R. CRIM. P. 41(g). Reasonableness under the circumstances is the test when a person seeks to obtain the return of property. FED. R. CRIM. P. 41 advisory committee note to 1989 amendments.
Where no criminal proceeding is pending, a proceeding for return of property pursuant to Fed.R.Crim.P. 41(g) has been deemed a civil proceeding for equitable relief. See, e.g., United States v. Search of Music City Marketing, Inc., 212 F.3d 920, 923 (6th Cir. 2000) (citations omitted); see also 27-4diam-641 JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE — CRIMINAL PROCEDURE § 641.194[3] (2004). However, the doctrine of sovereign immunity protects the government from suit except insofar as it has waived that immunity, and such a waiver must be expressed unequivocally in statutory text and will not be implied. United States v. Bein, 214 F.3d 408, 413 (3d Cir. 2000). Because Rule 41(g) does not expressly provide for an award of monetary damages, sovereign immunity is not waived and bars a claim against the government seeking money damages. Id. (rejecting cases that allowed an award of damages in a proceeding under the predecessor to Rule 41(g) and noting that Rule 41(g) provides for one express remedy, i.e., the return of property). In this case, the United States cannot return the property because it is no longer in possession of the Bearer Bonds. See United States v. Chambers, 92 F. Supp. 2d 396, 398-99 (D.N.J. 2000) (noting that no other remedies under Rule 41(g) appear available). Because the United States cannot return the Bearer Bonds or be sued for money damages under Rule 41(g), the court must dismiss Ms. Peloro's claim under Rule 41(g).
F. Unlawful conversion claim against defendant United States
Ms. Peloro alleges an unlawful conversion claim against the United States. Because the claim against the United States is for a breach of a common law tort duty, the Federal Tort Claims Act ("FTCA") governs and requires dismissal of this claim for the reasons set forth below.
Under the principle of sovereign immunity, federal courts lack jurisdiction over suits against the United States unless Congress expressly and unequivocally waives the United States' immunity to suit. See, e.g., United States v. Mitchell, 463 U.S. 206, 212 (1983). The FTCA, 28 U.S.C. § 2671, et seq., provides a limited waiver of sovereign immunity by giving district courts exclusive jurisdiction of civil action on claims against the United States for, inter alia, loss of property "caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred." 28 U.S.C. § 1346(b). Any waiver must be strictly construed in favor of the sovereign. E.g., United States v. Nordic Village, Inc., 503 U.S. 30, 33-34 (1992) (citations omitted).
The waiver provided by the FTCA is subject to exceptions, one of which specifies that the waiver shall not apply to:
Any claim arising in respect of the assessment or collection of any tax or customs duty, or the detention of any goods, merchandise, or other property by any officer of customs or excise or any other law-enforcement officer . . .28 U.S.C. § 2680(c). The majority of the federal courts of appeals have held that the term "any other law-enforcement officer" is not confined only to other law-enforcement officers performing customs or tax duties, but applies to all law-enforcement officers who, in the performance of their lawful duties, have detained goods. See, e.g., Chambers, 92 F. Supp. 2d at 402 (citing cases from several courts of appeals) (citations omitted); see also Donald T. Kramer, Annotation, Construction of Federal Tort Claims Act Exception in 28 U.S.C.A. § 2680(c), 173 A.L.R. FED. 465 (2004) (noting that courts have applied this exception to bar actions against the United States where the FBI has detained property in non-tax and non-customs contexts). FBI agents are included within the meaning of "other law-enforcement officers." E.g., Haughton v. Fed. Bureau of Investigation, No. 98 Civ. 3418 (BSJ), 1999 WL 1133346, at *6 (S.D.N.Y. Dec. 10, 1999) (holding that plaintiff's claim for compensation from the FBI for certain bonds allegedly lost by the FBI following their seizure was barred by 28 U.S.C. § 2680(c)). Here, Ms. Peloro claims that the FBI unlawfully converted the Bearer Bonds when it seized and subsequently detained them. Pursuant to 28 U.S.C. § 2680(c), the United States has not waived sovereign immunity with respect to this claim, which must therefore be dismissed.
Even if 28 U.S.C. § 2680(c) did not bar relief under the FTCA, Ms. Peloro would not be able to avail herself of a remedy pursuant to the FTCA because she has failed to comply with the conditions precedent to maintaining an action under the FTCA. See Chambers, 92 F. Supp. 2d at 402. No action may be brought under the FTCA unless the plaintiff has first presented her claim to the appropriate federal agency and the agency has either denied the claim or failed to act on it within six months of its submission. E.g., McNeil v. United States, 508 U.S. 106 (1993) (citing 28 U.S.C. § 2675(a)). Moreover, the claim must be filed with the administrative agency within two years after the claim accrues or it will be "forever barred." 28 U.S.C. § 2401(b). A claim "accrues" when the injured party knows both the existence and cause of his injury. Peterson v. United States, 694 F.2d 943, 945 (3d Cir. 1982) (citing United States v. Kubrick, 444 U.S. 111 (1979). In this case, Ms. Peloro has never filed any administrative claim with the FBI for return of the Bearer Bonds, even though her October 25, 1999 letter to the Trustee indicates that she knew, at least as early as the date of the letter if not earlier, the Bearer Bonds had been seized by the United States. Since more than two years have elapsed since her claim accrued, the statute of limitations has run, and her claim against the United States is forever barred.
IV. CONCLUSION
For the reasons stated above, the court will grant the Trustee's and R.H.'s motion for summary judgment and the United States' motion to dismiss.