United States District Court, D. Minnesota
Dim Njaka, Box 244, Long Lake, MN 55356, pro se.
Friedrich A. P. Siekert, Assistant United States Attorney, UNITED STATES ATTORNEY'S OFFICE, 600 United States Courthouse, 300 South Fourth Street, Minneapolis, MN 55415; and Ryan R. Montgomery, FEDERAL RETIREMENT THRIFT INVESTMENT BOARD, 77 K Street NE, Washington, DC 20002, for defendants.
MEMORANDUM OPINION AND ORDER ADOPTING REPORT AND RECOMMENDATION OF MAGISTRATE JUDGE
JOHN R. TUNHEIM, District Judge.
Plaintiff Dim Njaka filed this action alleging that the Defendants breached fiduciary duties owed to him as a federal Thrift Savings Plan ("TSP") participant under the Federal Employees' Retirement System Act of 1986 ("FERSA"). The Defendants moved to dismiss for insufficient service of process, lack of personal jurisdiction, and failure to state a claim on which relief may be granted. Njaka filed several motions seeking injunctive relief and leave to file a second amended complaint. On June 24, 2014, United States Magistrate Judge Jeanne J. Graham issued a Report and Recommendation ("R&R") recommending that the Court grant Defendants' motion to dismiss with prejudice and deny all of Njaka's motions. This matter is now before the Court on Njaka's objections to the R&R. Having conducted a de novo review of those portions of the R&R to which Plaintiff objects, see 28 U.S.C. § 636(b)(1)(C); D. Minn. LR 72.2(b), and having carefully reviewed the submitted materials, the Court will overrule Njaka's objections and adopt the R&R because it finds that some of the Defendants were not fiduciaries as defined by FERSA, and the remainder of Njaka's claims are barred by the statute of limitations.
I. DISPUTE SURROUNDING NJAKA'S RETIREMENT BENEFITS
Njaka was a mail handler for the United States Postal Service ("USPS") in 1988. (Am. Compl. ¶ 13, Mar. 5, 2013, Docket No. 9.) On September 2, 1988, he sustained an on-the-job injury. ( Id. ) On May 22, 1989, he received a letter from the Department of Labor's Office of Workers' Compensation Programs ("OWCP") informing him that the OWCP had reviewed his diagnosis and accepted his on-the-job injury claim. ( Id. ¶ 14.)
As a result of the OWCP accepting his claim, Njaka received a letter on November 27, 1989, informing him that he was entitled to a "leave buy back." ( Id. ¶ 15.) A leave buy back is an option available to workers injured on-the-job who are forced to use sick or annual leave to cover their injury-related absence. ( Id. ¶ 16.) The leave buy back option involves altering the worker's status from being on "leave with pay" to "leave without pay, " which then enables the worker to reinstate their sick or annual leave and receive compensation for the leave they used to cover their absence. ( Id. ¶¶ 16-17.) During "leave with pay" status, employees receive 100% of their salary, including benefits such as retirement plan contributions. ( Id. ¶ 17.) OWCP compensation for "leave without pay" periods is paid at two-thirds of the employee's base pay and does not include additional benefits such as retirement contributions. (Decl. of Dim Njaka, Ex. 26 (Leave Buy Back Worksheet) at 92, Feb. 7, 2014, Docket No. 60-2.)
In Njaka's case, the OWCP informed him that he was eligible to buy back leave for the period extending from December 19, 1988 through January 20, 1989. (Am. Compl. ¶ 15.) On December 18, 1989, Njaka completed the "Application for Reinstatement of Leave, " which was attached to the OWCP's November 27, 1989 letter. ( Id. ¶ 18.) Njaka alleges that the USPS withheld his leave buy back compensation amount of $1, 947.02 and sent two internal requests to the OWCP for more information about Njaka's claim. ( Id. ¶ 20.) Njaka's employment was then terminated on May 21, 1990. ( Id. ¶ 21.) The terminal leave worksheet stated that Njaka had a remaining sick leave balance of one hour and that the reason for his termination was "[E]XCESS ABSENCE." ( Id. ¶ 22.) Njaka received a compensation check from OWCP on June 27, 1990, in the amount of $3, 035.46, which he believed was related to his leave buy back compensation. ( Id. ¶ 23.)
In July 1990, Njaka attempted to contact the USPS personnel office regarding the OWCP compensation check. ( Id. ¶ 24.) On August 20, 1990, a retirement specialist with the USPS informed him that if his separation was "later determined to have been improper, " and if he was "returned to employment, and if [his] restoration [wa]s with entitlement to pay into the retirement fund, " then his "basic pay over the intervening period [would] be subject to retirement deductions" and he would receive credit for his improper separation during that intervening period. ( Id. ¶ 25.)
On the same day (August 20, 1990), the USPS completed for Njaka a Form TSP-18, a "validation of retirement information" form submitted by federal agencies within thirty days of an employee's separation. ( Id. ¶¶ 29, 50.) The form relates to the federal TSP, which is a defined contribution pension plan for federal employees, structured similarly to a private-sector 401(k) plan. ( Id. ¶¶ 2, 4.) The TSP is administered by the Federal Retirement Thrift Investment Board ("FRTIB"). ( Id. ¶¶ 1-2.) Prior to its elimination in 1995, Form TSP-18 was "used to determine the [TSP] participant's withdrawal options and when certain withdrawals may begin. Hence, TSP accounts [could not] be disbursed before this form [was] received." ( Id. ¶¶ 50-52 (emphasis and citation omitted).) In Njaka's case, Sharon Malmborg, the USPS benefits officer that completed Njaka's Form TSP-18, marked on the form that Njaka's retirement category was "none, " rather than "disability/workers' compensation." ( Id. ¶¶ 1, 28.) The form was then sent to the National Finance Center, which used the information on the Form TSP-18 to draft Form TSP-494, a letter declaring Njaka ineligible for retirement benefits through TSP. ( Id. ¶ 29.) The letter, dated January 18, 1991, instructed Njaka to contact the TSP Services Office if he believed the retirement ineligibility determination was incorrect. ( Id. ¶ 30.) Because Njaka believed it was correct at the time, ( id. ), he signed the Form TSP-494 on March 20, 1991, indicating that he was "a TSP participant without retirement eligibility (generally less than five years of service).'" ( Id. ¶ 31.) Accordingly, the funds he had collected in his TSP account (less than $3, 500) were automatically distributed to him. ( Id. ¶¶ 30, 58.)
On October 2, 1991, OWCP granted Njaka a leave buy back award of $54.08 for leave Njaka took on December 7, 1989. ( Id. ¶ 32.) On October 4, 1991, Njaka attempted to reinstate his sick and annual leave to reflect the leave buy back, but the USPS informed him that it was unable to process his request given that he no longer worked for the agency. ( Id. ¶¶ 32-37.) Njaka alleges that the USPS failed to take the necessary further action to "restore or adjust Plaintiff's TSP balance to reflect these [leave buy back] awards." ( Id. ¶ 38.)
II. THIS PROCEEDING
A. Njaka's Amended Complaint
In an effort to obtain a TSP account adjustment for his leave buy back awards, Njaka initiated this action alleging multiple violations of the FERSA. Specifically, Njaka claims that the errors in completing and processing his Form TSP-18 - and, consequently, Form TSP-494 - constituted breaches of fiduciary duties under FERSA, 5 U.S.C. §§ 8472(h) and 8477(b)(1), and caused him to lose TSP contributions for which he argues Defendants are now personally liable, see 5 U.S.C. § 8477(e)(1)(A). His amended complaint has seven counts.
In Count I, Njaka alleges breach of the fiduciary duty to act "with the care, skill, prudence, and diligence under the circumstances then prevailing, " id. § 8477(b)(1)(B), by the current members of the FRTIB; Gregory T. Long, the current Executive Director of the FRTIB; the United States Secretary of Labor; and Patrick R. Donahoe, the Postmaster General. (Am. Compl. ¶¶ 77-81.) Count II alleges a breach of fiduciary duty under § 8477(b)(1) by Sharon Malmborg, the USPS benefits officer that completed Njaka's Form TSP-18. ( Id. ¶¶ 83-85.) Count III alleges that Defendant Long and the members of the FRTIB violated § 8477(c)(2)(B), which prohibits a TSP fiduciary from acting "in any transaction involving the [TSP] on behalf of a party, or representing a party, whose interests are adverse to the interests of the [TSP] or the interests of its participants or beneficiaries...." 5 U.S.C. § 8477(c)(2)(B). (Am. Compl. ¶¶ 87-89.) Count IV asserts that Defendant Pamela-Jeanne Moran, the Director of the Office of Participant Services for the FRTIB, "knowingly and substantially assisted [Defendant Long, Defendant Malmborg, and the members of the FRTIB] in their breaches of fiduciary duty" in Counts I, II, and III. ( Id. ¶¶ 91-92.) Count V makes the same "knowingly and substantially assisted" allegation against Thomas K. Emswiler, the FRTIB General Counsel. ( Id. ¶¶ 94-95.) Count VI alleges that the USPS (acting through Postmaster General Donahoe) breached its fiduciary duty, under § 8477(b)(1)(B), to act with care and diligence in providing Njaka with his TSP contributions. (Am. Compl. ¶¶ 97-99.) Finally, Count VII asserts against Defendant Long, the USPS (through Defendant Donahoe), and the members of the FRTIB, an additional breach of fiduciary duty under 5 U.S.C. §§ 8477(b)(1)(B) and 8477(c)(1)(A), for failing to "[allow] the transfer of assets with adequate consideration" in the form of his "disability benefits related to OWCP Leave Buy Back awards." (Am. Compl. ¶¶ 101-103.)
B. The Motions Before the Court
In this Order, the Court addresses a number of motions filed by the parties. First, the Defendants moved to dismiss Njaka's claims with prejudice on four grounds: lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2); insufficient process under Rule 12(b)(4); insufficient service of process under Rule 12(b)(5); and failure to state a claim upon which relief can be granted, under Rule 12(b)(6). (Mot. to Dismiss, Jan. 17, 2014, Docket No. 49.)
Njaka subsequently applied for a temporary restraining order preventing the members of the FRTIB from:
[M]odifying, amending or terminating the employment and related benefits of an OWCP-certified permanently disabled Plaintiff who was entitled to the suitable position of a computer programmer/analyst on February 5, 1990 or at any time before or after that date, pending this Court's consideration of Plaintiff's motion for a preliminary injunction. And for the [members of the FRTIB] to cease and desist from any legislative efforts to reduce the statute of limitations on filing benefits claims.
(Pl.'s Appl. for TRO at 1, Feb. 7, 2014, Docket No. 56.) At the same time, Njaka also moved for a preliminary injunction to "enjoin the defendants from terminating his employment and all disability benefits related to his Injured on Duty (IOD) status.... Defendants have denied these benefits since February 5, 1990 and continuing." (Pl.'s Mot. for a Prelim. Inj. at 1, Feb. 7, 2014, Docket No. 57.) Additionally, he moved for leave to file a second amended complaint, which adds William Jasien, Thomas E. Perez, and Unknown Agents as Defendants in the caption, but appears to be otherwise unaltered from his amended complaint. (Mot. for Leave to File Second Am. Compl., Apr. 14, 2014, Docket No. 89.) William Jaisen has replaced Defendant Duffy on the FRTIB, (R&R at 7, June 24, 2014, Docket No. 108), and Thomas E. Perez has become the Secretary of Labor, ( id. at 6 n.5). Finally, Njaka filed a motion to reconsider the Court's Order granting Defendants an extension of time to file their memorandum in opposition to Njaka's motion to file a second amended complaint. (Req. for Mot. to Reconsider, Apr. 29, 2014, Docket No. 100.) In his motion to reconsider, Njaka argues that granting ...