Facts
- The Federal Savings and Loan Insurance Corporation (FSLIC), acting as receiver for a failing thrift, terminated Meyer, a senior officer.
- Meyer sued in federal court seeking money damages, alleging he was discharged without notice and a hearing in violation of the Fifth Amendment’s Due Process Clause.
- Meyer pursued an implied constitutional tort remedy modeled on Bivens, but directed the claim against FSLIC as an entity.
- A jury returned a verdict for Meyer.
- During appellate proceedings, the Federal Deposit Insurance Corporation (FDIC) became FSLIC’s statutory successor and continued the case.
Issues
- Whether a damages claim alleging a federal constitutional violation is “cognizable” under 28 U.S.C. § 1346(b) such that the Federal Tort Claims Act (FTCA) is the exclusive remedy and bars a direct action against the agency.
- Whether FSLIC’s statutory “sue-and-be-sued” clause waives sovereign immunity for a constitutional tort damages claim.
- Whether a Bivens-type implied cause of action for damages may be maintained directly against a federal agency.
Decision
- The Supreme Court held that Meyer’s constitutional tort claim was not “cognizable” under § 1346(b); therefore, the FTCA did not provide an exclusive remedy that displaced the claim.
- The Court held that FSLIC’s “sue-and-be-sued” clause presumptively waived sovereign immunity for claims of this type.
- The Court held that Bivens does not extend to federal agencies; no implied constitutional damages action lies directly against FSLIC/FDIC.
- Because Meyer’s claim depended on an implied agency-level Bivens remedy, the judgment for Meyer could not stand.
Legal Principles
- A claim is “cognizable” under 28 U.S.C. § 1346(b) only if liability exists “in accordance with the law of the place,” meaning state law; constitutional tort claims arise under federal law and therefore fall outside § 1346(b).
- The FTCA’s exclusivity provision applies only to claims that are cognizable under § 1346(b), not to federal constitutional tort claims.
- A statutory “sue-and-be-sued” clause is read broadly and presumptively waives sovereign immunity absent a clear showing of congressional intent to limit that waiver.
- Bivens remedies are confined to suits against individual federal officers; implying a damages action against federal agencies is not supported by Bivens’s deterrence rationale and is generally for Congress to authorize.
Conclusion
The Court ruled that although the FTCA did not preempt the suit and a sue-and-be-sued clause waived immunity, federal agencies are not proper defendants in Bivens-type constitutional damages actions, requiring reversal of Meyer’s judgment against the FDIC.