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Shanafelt v. Department of Veteran Affairs

United States District Court, D. Massachusetts

July 23, 2018




         Pending before this court is a motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6) (“Rule 12(b)(6)”) and Fed.R.Civ.P. 12(b)(1) (“Rule 12(b)(1)”) filed by defendants Department of Veteran Affairs of the United States of America (“the VA”) and the United States of America (“the United States”) (collectively “defendants”). (Docket Entry # 17). Plaintiffs Christine Shanafelt (“Shanafelt”) and United States Army Reserve Staff Sergeant Damon Shanafelt (“Sgt. Shanafelt”) oppose the motion. (Docket Entry # 20). After conducting a hearing, this court took the motion (Docket Entry # 17) under advisement.


         The parties' dispute arises out of a Servicemember's Group Life Insurance Policy (“SGLI”) on the life of Shanafelt's husband, Sgt. Shanafelt, that named Shanafelt as the sole beneficiary. (Docket Entry # 1). The two-count complaint sets out a claim against defendants for negligence under the Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 1346 (“section 1346”) (Count I); and a claim for breach of contract (Count II). (Docket Entry # 1).

         Defendants aptly point out (Docket Entry # 18, n.2) that the United States is the only proper party under the FTCA. See Roman v. Townsend, 224 F.3d 24, 27 (1st Cir. 2000) (“FTCA requires that the named defendant in an FTCA action be the United States and only the United States”) (citing 28 U.S.C. §§ 1346(b), 2674, 2679(a)). Although the argument only absolves the VA of liability, it provides an alternative ground to dismiss the claims against the VA.[1]

         Separately, neither party addresses whether Sgt. Shanafelt, as opposed to the representative of his estate, is a proper party. The complaint simply describes plaintiff as Sgt. Shanafelt's widow. In addition, neither party addresses or explains why Sgt. Shanafelt has a cause of action for negligence that allegedly took place after his death. “A person who dies prior to filing suit is not a legal entity.” Adelsberger v. United States, 58 Fed.Cl. 616, 618 (2003) (collecting cases); see also Chorney v. Callahan, 135 F.Supp. 35, 36 (D. Mass. 1955) (Fed. R. Civ. P. 25 did not apply because “action was brought against a named defendant who was already dead” and “a dead man obviously cannot be named [a] party defendant in an action”). The “majority of federal and state” courts considering “the issue agree that an action filed in the name of a pre-deceased plaintiff is not viable.” In re Asbestos Product Liability Litigation, (No. VI), 311 F.R.D. 152, 154 (E.D. Pa. 2015). Accordingly, Sgt. Shanafelt is not a legal entity. Because he is not a legal entity and cannot file this action as a plaintiff, he is dismissed as a party. Even assuming for purposes of argument that he could proceed as a plaintiff, the complaint is subject to dismissal for reasons stated below.[2]


         In reviewing the sufficiency of a complaint under Rule 12(b)(6), the complaint must contain enough facts that, if presumed true, “state a claim to relief that is plausible on its face.” Bell Atlantic v. Twombly, 550 U.S. 544, 570 (2007); Miller v. Town of Wenham, 833 F.3d 46, 51 (1st Cir. 2016). The “standard is ‘not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully.'” Saldivar v. Racine, 818 F.3d 14, 18 (1st Cir. 2016) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)); Feliciano-Hernández v. Pereira-Castillo, 663 F.3d 527, 533 (1st Cir. 2011). Factual allegations in the complaint are taken as true and reasonable inferences are drawn in favor of the plaintiff. Ashcroft, 556 U.S. at 678; Sanders v. Phoenix Ins. Co., 843 F.3d 37, 42 (1st Cir. 2016). Exhibits A through D attached to the complaint (Docket Entry # 1-2, Ex. A-D) are “properly considered part of the pleading for all purposes, ” including Rule 12(b)(6). Trans-Spec Truck Service, Inc. v. Caterpillar Inc., 524 F.3d 315, 321 (1st Cir. 2008); Fed.R.Civ.P. 10(c). The court may also consider a limited category of documents outside the complaint without converting the motion into one for summary judgment. Such documents include public records, “‘facts susceptible to judicial notice, '” and documents sufficiently referred to in the complaint. Butler v. Balolia, 736 F.3d 609, 611 (1st Cir. 2013) (supplementing facts in complaint “by examining ‘documents incorporated by reference into the complaint, matters of public record, and facts susceptible to judicial notice'”). Legal conclusions in a complaint are not part of the Rule 12(b)(6) record. See In re Ariad Pharmacy, Inc. Securities Litigation, 842 F.3d 744, 750 (1st Cir. 2016) (refusing to credit legal conclusions in reviewing motion to dismiss).

         When considering a Rule 12(b)(1) motion, this court must credit the plaintiff's well-pled factual allegations and draw all reasonable inferences in the plaintiff's favor. Merlonghi v. United States, 620 F.3d 50, 54 (1st Cir. 2010) (citing Valentin v. Hospital Bella Vista, 254 F.3d 358, 363 (1st Cir. 2001)); Sánchez ex rel. D.R.-S. v. U.S., 671 F.3d 86, 92 (1st Cir. 2012) (“credit[ing] the plaintiff's well-pled factual allegations and draw[ing] all reasonable inferences in the plaintiff's favor” under Rule 12(b)(1)). “The district court may also ‘consider whatever evidence has been submitted, such as the depositions and exhibits submitted.'” Merlonghi v. United States, 620 F.3d at 54 (quoting Aversa v. United States, 99 F.3d 1200, 1210 (1st Cir. 1996)). Where, as here, a defendant challenges subject matter jurisdiction, the plaintiff bears the burden of proving jurisdiction. Johansen v. United States, 506 F.3d 65, 68 (1st Cir. 2007). Dismissal is only appropriate when the facts alleged in the complaint, taken as true, do not support a finding of federal subject matter jurisdiction. Fothergill v. United States, 566 F.3d 248, 251 (1st Cir. 2009). Finally, “‘Federal courts are courts of limited jurisdiction'” and “[t]he existence of subject-matter jurisdiction” is therefore “‘never presumed.'” Fafel v. Dipaola, 399 F.3d 403, 410 (1st Cir. 2005) (quoting Kokkonen v. Guardian Life Insurance Co. of America, 511 U.S. 375, 377 (1994), and Viqueira v. First Bank, 140 F.3d 12, 16 (1st Cir. 1998)).


         The VA provides certain benefits to servicemen, including life insurance in the form of SGLI policies. (Docket Entry # 1-2); see also Servicemens' Group Life Insurance Act of 1965, as amended, 38 U.S.C. §§ 1965 et seq. (“SGLIA”). Prudential Insurance Company of America (“Prudential”), the administrator of Sgt. Shanafelt's policy, administers these SGLI policies through its Office of Servicemembers' Group Life Insurance (“OSGLI”). (Docket Entry # 1-2). On July 31, 2015, six days after returning home from his annual Army Reserve Training, Sgt. Shanafelt committed suicide. (Docket Entry # 1). At the time of his death, Sgt. Shanafelt was married to Shanafelt, the named beneficiary under his $400, 000 SGLI policy. (Docket Entry # 1).

         On August 2, 2015, two Certified Casualty Officers (“CCOs”) from Sgt. Shanafelt's unit, Sergeant Walker and Lieutenant Goslin, visited Shanafelt at her home.[3] (Docket Entry # 1). Sergeant Walker and Lieutenant Goslin presented Shanafelt with a file containing information concerning Sgt. Shanafelt's payable benefits, including information about the SGLI policy. (Docket Entry # 1). During their visit and without Shanafelt's consent, Sergeant Walker and Lieutenant Goslin “divulged to a room full of people, sensitive benefit information, ” including Shanafelt's entitlement to the $400, 000 of SGLI proceeds. (Docket Entry # 1). Shanafelt believes that it was from this exchange that Sgt. Shanafelt's ex-spouse, G. Fillipone (“Fillipone”), learned about Sgt. Shanafelt's death and the SGLI policy. (Docket Entry # 1).

         On August 3, 2015, Fillipone submitted a formal claim to Prudential for $250, 000 under the SGLI policy on the basis that “her children were the rightful beneficiaries.” (Docket Entry # 1). In a letter dated September 9, 2015, Prudential notified Shanafelt that she was unable to receive any SGLI benefits at that time due to an adverse claim on Sgt. Shanafelt's policy. (Docket Entry ## 1, 1-2).

         After receiving Fillipone's claim, Prudential undertook a 36-day review and, at the conclusion of the review, issued a decision granting Fillipone the right to bring a claim for the proceeds in court. (Docket Entry # 1). During the review process, the VA indicated to Shanafelt that the matter of the insurance proceeds was “under investigation.” (Docket Entry # 1). According to the complaint, it also “became apparent” during the 36-day investigative review that “the VA” was involved in the investigation and subsequent decision to allow Fillipone the right to sue in court. (Docket Entry # 1).

         On the 30th day of the investigation, Shanafelt was served with a restraining order and thereafter a complaint filed by Fillipone in Middlesex County Probate and Family Court (“the probate court”). (Docket Entry # 1). Fillipone filed the probate court action against Prudential as well as Shanafelt. (Docket Entry # 1). Prudential thereafter removed the action to the United States District Court for the District of Massachusetts. See Fillipone v. Shanafelt et. al, Civil Action No. 15-13680-LTS.[4] As a result of the lawsuit, Shanafelt hired an attorney “on a contingency fee basis” and incurred a total cost of $128, 000 in defending the lawsuit. (Docket Entry # 1).

         On or about May 31, 2016, Shanafelt, through her attorney, “sent via certified mail” a “Notification of Incident and Claim for Damages under the Federal Tort[] Claim[s] Act & Military Act” (“the notification”) to the VA. (Docket Entry ## 1, 1-2). By letter dated August 5, 2016, the VA advised Shanafelt that an investigator, staff attorney Lisa Wolfe, Esq. (“Attorney Wolfe”), was assigned to investigate the claims outlined in the notification. (Docket Entry # 1). Shanafelt's attorney attempted several times without success “to obtain a status update” concerning the claims in the notification. More than six months after sending the notification, Shanafelt filed the complaint in this action. (Docket Entry # 1).


         In Count I, Shanafelt asserts that the actions of VA employees constitute negligence under both federal and Massachusetts law. (Docket Entry # 1). Specifically, she alleges that, “Federal and Massachusetts state law imposes a duty of care upon the VA” and that the VA breached this duty with respect to “the handling, maintenance, and care of Sgt. Shanafelt's SGLI policy, ” its disbursement of benefits, and by allowing Fillipone to initiate a claim for the benefits in the probate court. (Docket Entry # 1). In Count II, Shanafelt contends that defendants breached the SGLI policy agreement by failing to disburse the $400, 000 in payable benefits to Shanafelt. (Docket Entry # 1). She asserts both claims against both defendants.

         Defendants move to dismiss the claims under Rule 12(b)(1) and Rule 12(b)(6). More narrowly, defendants initially seek to dismiss the complaint for lack of subject matter jurisdiction on the basis of sovereign immunity. (Docket Entry # 18). While defendants argue that the SGLIA preserves sovereign immunity in this action, Shanafelt contends that section 1346(b)(1) of the FTCA waived defendants' sovereign immunity for both counts. Defendants maintain that to the extent that their sovereign immunity is waived, if at all, “the discretionary function exception to the [FTCA]” applies. (Docket Entry # 18). Defendants ...

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