Summary
In Zolman the district court approved the Magistrate Judge's recommendation that two federal employees be granted relief from a state court default judgment pursuant to Rule 60(b)(1) for "mistake, inadvertence, surprise, or excusable neglect."
Summary of this case from Cotter v. U.S.Opinion
No. 1.00-CV-28.
March 28, 2001.
MEMORANDUM OPINION APPROVING REPORT AND RECOMMENDATION
This case presents a tort action by a pro se plaintiff. On March 15, 2000, plaintiff Gregory Zolman filed a complaint in the Grand Traverse County Circuit Court against Internal Revenue Service employees Richard Vervisch, Larry Haines, Michael Gruba and ten unnamed "Doe" defendants. On April 14, 2000, after the defendants failed to appear, plead, or otherwise defend within the 28-day period allowed by state law, default judgment was requested by plaintiff and entered by the Clerk of the Court against defendants Haines and Vervisch in the amount of $600, plus $55.12 in costs and fees.
Defendant Gruba was served at a later date and was therefore not in default at the time judgment was requested.
On April 21, 2000, defendants removed the action to this Court pursuant to 28 U.S.C. § 2679(d)(2), 1441(a) and (b), and 1442(a)(1). Attached to the defendants' notice of removal is certification by the United States Attorney for this district that the defendants Vervisch, Haines, and Gruba "were acting within the scope of their employment and office as employees of the United States at the time that the incident out of which plaintiff's claims arose allegedly occurred." Due to this certification, the United States was automatically substituted as the party defendant. 28 U.S.C. § 2679(d)(1). A motion for an extension of time in which to answer or otherwise respond to the complaint was granted on April 27, 2000. On May 10, 2000 the United States moved to set aside the state default judgment pursuant to Fed.R.Civ.P. 60(b). The United States also moved to dismiss the action pursuant to Fed.R.Civ.P. 12(b).
The fact that a partial default judgment had already issued in the state court did not defeat defendants' right of removal. See Matter of Meyerland Co., 960 F.2d 512, 517 (5th Cir. 1992); Munsey v. Testworth Laboratories, Inc., 222 F.2d 902, 903 (6th Cir. 1955).
Plaintiff has responded by opposing the United States' motions, asserting that the state court default judgment is valid, and expressing confusion as to the removal of the action. On January 2, 2001, United States Magistrate Judge Joseph G. Scoville issued a report and recommendation pursuant to 28 U.S.C. § 636(b), recommending that both of defendant's motions be granted.
Further, to the extent it is not clear, on the present record, that defendants timely removed this action, the Court notes that plaintiff waived his right to object to any procedural defect by failing to move for remand within 30 days after the filing of the notice of removal. See 28 U.S.C. § 1447(c). Plaintiff has timely filed objections to the magistrate judge's report and recommendation.
I
The magistrate judge recommends that the United States be awarded relief from default judgment under Fed.R.Civ.P. 60(b)(1). Rule 60(b)(1) provides relief due to "mistake, inadvertence, surprise, or excusable neglect." Federal courts have applied this rule liberally when the defendant moves promptly for relief, shows that the default was not willful, that the defendant has a meritorious defense, and that the opposing party will not be prejudiced. See American Alliance Ins. Co., Ltd. v. Eagle Ins. Co., 92 F.3d 57, 59 (2d Cir. 1996).
The United States has met these requirements. The Court concurs in the magistrate judge's findings. The United States acted promptly in filing its motion. The government employees or its attorneys do not appear to have willfully allowed the state court default judgment to be entered. The action was removed to this Court one week following the entry of default judgment. The United States has a meritorious defense, discussed below. Finally, the plaintiff has shown no prejudice resulting from the government's delayed response. Accordingly, the United States' motion will be granted and the default judgment will be set aside.
II
In his complaint, plaintiff alleges that he was maliciously defamed by Vervisch, Haines, and Gruba when they imputed to him the commission of certain federal crimes. Although his complaint purports to assert two claims, the second, entitled "malice," appears to merely clarify and augment the allegations of his first claim, entitled "defamation." The Court agrees with the magistrate judge's conclusion that plaintiff has failed to state a claim upon which relief can be granted.
By virtue of the United States' substitution as the proper party defendant, plaintiff's defamation claim must be deemed to have been brought under the Federal Tort Claims Act ("FTCA"), 28 U.S.C. § 2671 et seq. As observed by the magistrate judge, before suit can be filed under the FTCA, a plaintiff must initially exhaust administrative remedies. Because plaintiff has failed to plead or demonstrate compliance with the necessary prerequisites, his claim under the FTCA is jurisdictionally barred. See Fishburn v. Brown, 125 F.3d 979, 982 (6th Cir. 1997).
Furthermore, even if plaintiff had first sought and exhausted administrative remedies, his defamation claim would still be excluded from recovery under the FTCA. 28 U.S.C. § 2680(h). A defamation claim is an excepted claim upon which neither the United States nor its employees may be sued. United States v. Smith, 499 U.S. 160 (1991). That is, the FTCA also protects federal employees from liability for allegedly slanderous conduct committed within the scope of their employment. Henson v. NASA, 14 F.3d 1143, 114748 (6th Cir. 1994).
Plaintiff insists the individual agents acted outside the scope of their employment. However, plaintiff has failed, in both his complaint and his objections, to allege with any specificity exactly how the Internal Revenue agents acted outside the scope of their employment. Plaintiff cites Internal Revenue Code and other statutory provisions, arguing in general terms that the agents violated their own regulations and procedures. Yet, plaintiff fails to specifically state the manner in which the agents, in their alleged defamation, acted outside the scope of their duties, so as to be subject to liability in tort notwithstanding 28 U.S.C. § 2680(h).
Despite having been afforded ample opportunity to do so, plaintiff has failed to explain or amend his complaint so as to state a valid claim upon which relief can be granted. The United States' motion to dismiss the complaint must therefore be granted.
III
Accordingly, the Court approves the magistrate judge's report and recommendation over objection. An order consistent with this opinion shall issue forthwith.
ORDER SETTING ASIDE DEFAULT JUDGMENT AND DISMISSING COMPLAINT
In accordance with the Court's memorandum opinion of even date,IT IS HEREBY ORDERED that the United States' motion to set aside the default judgment is GRANTED; and
IT IS FURTHER ORDERED that the United States' motion to dismiss the complaint is GRANTED; and
IT IS FURTHER ORDERED that the complaint of plaintiff Gregory Zolman is DISMISSED in its entirety for failure to state a claim upon which relief can be granted.