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Trico Development Associates, Limited Partnership v. O.C.E.A.N.

September 29, 2011


The opinion of the court was delivered by: Cooper, District Judge


This matter is before the Court on the Motion to Dismiss of Third-Party Defendant, the United States of America ("the United States"), which contends, pursuant to Federal Rule of Civil Procedure ("Rule") 12(b)(1), that this Court lacks subject matter jurisdiction over the Amended Third-Party Complaint of Defendant, O.C.E.A.N., Inc. ("Ocean"). (Dkt. entry no. 11, Mot. Dismiss.)*fn1

Ocean opposes the motion. (Dkt. entry no. 13, Def. Opp.) The Court, pursuant to Local Civil Rule 78.1(b), decides the motion on the papers and, for the reasons set forth below, will grant the motion, dismiss the Amended Third-Party Complaint, and remand the remainder of the action to state court.


Plaintiff, Trico Development Associates, Limited Partnership ("Trico"), commenced this action in the Superior Court of New Jersey ("Superior Court") alleging that Ocean breached a contract whereby Trico agreed to sell the Emerald Terrace apartment complex ("Emerald Terrace") to Ocean. Trico I at *1. Emerald Terrace was subject to a program operated by the Rural Development Agency of the United States Department of Agriculture ("USDA"). Id. Through the Complaint, Trico alleged that Ocean prepared a proposed contract for purchasing Emerald Terrace in April 2008, and that the final sales contract was executed in August 2009. Trico allege[d] that at the time of the execution, Ocean was aware of a settlement agreement between Trico and the United States that would allow the USDA to foreclose upon the apartment complex if closing did not occur.

Trico allege[d] that in December 2009, two days prior to closing, Ocean informed Trico that the closing would not occur unless Trico credited Ocean with $115,843. The Complaint against Ocean alleged five counts including breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, conversion, and intentional misrepresentation.

Id. (internal citations omitted).

Ocean brought a derivative action against the United States, alleging that the United States tortiously interfered with the contract by advising Ocean that the USDA would not approve the closing of title unless Trico paid Ocean $115,843 to perform certain repairs. See id. at *1, *3 n.1, *4. The United States, pursuant to 28 U.S.C. § 1442(a)(1), removed the case to this Court and thereafter filed a Motion to Dismiss the Third-Party Complaint pursuant to Rule 12(b)(6), contending that Ocean's claims were barred by the Federal Tort Claims Act, 28 U.S.C. § 1346 ("FTCA"). Id. at *1. Upon consideration of the motion and the parties' briefs thereon, the Court granted the motion, dismissed the Third-Party Complaint, and remanded the remainder of the action to state court. Id. at *4.

Upon remand to the Superior Court, Ocean filed a Motion to Dismiss the Complaint. (Dkt. entry no. 11, United States Br. at 1; dkt. entry no. 13, Def. Opp. at 1-2.) The Superior Court granted the motion but permitted Trico to file an Amended Complaint, which Trico filed on or about February 28, 2011. (United States Br. at 2; Def. Opp. at 2.) Through the Amended Complaint, Trico alleges that the United States had actual or apparent authority to act as Ocean's agent, and that the United States so acted by insisting that Trico pay Ocean approximately $115,000 as a predicate to the above-mentioned sale of Emerald Terrace. (United States Br. at 2; Def. Opp. at 2.) Trico has thus proceeded against Ocean under a theory of agency liability. (United States Br. at 2; Def. Opp. at 2.) Ocean filed an Amended Third-Party Complaint, contending that the United States, as Ocean's alleged agent, owed a fiduciary duty to Ocean and breached that duty. (Dkt. entry no. 1, Notice of Removal, Ex. A ("Amend. Third Pty. Compl."), at 13-14.) Ocean accordingly seeks: (1) damages, costs, and fees resulting from the fiduciary duties owed to Ocean and breached by the United States; (2) contribution for any amounts that Ocean owes to Trico; and (3) to make the United States an indispensable party to this action. (Id. at 14-16.) The United States, in response, again removed the action to this Court, pursuant to 28 U.S.C. § 1442(a)(1). (Dkt. entry no. 1, Notice of Removal.) The United States also filed the instant motion, whereby the United States, pursuant to Rule 12(b)(1), seeks to dismiss Ocean's Amended Third-Party Complaint. (United States Br..) The United States claims that the Court lacks jurisdiction for three reasons, i.e., that: (1) as in the first proceeding before the Court, the FTCA bars Ocean's claims; (2) the United States Court of Federal Claims has exclusive jurisdiction over this matter; and (3) the doctrine of derivative jurisdiction precludes the Court's exercise of jurisdiction. (United States Br.) Ocean opposes the motion. (Def. Opp.)


A party may move to dismiss a claim for lack of subject matter jurisdiction. Fed.R.Civ.P. (12)(b)(1). "Challenges to subject matter jurisdiction under Rule 12(b)(1) may be facial or factual. Facial attacks . . . contest the sufficiency of the pleadings, and the trial court must accept the complaint's allegations as true." Common Cause of Pa. v. Pa., 558 F.3d 249, 257 (3d Cir. 2009) (citation omitted). When ruling upon a facial attack, the Court may dismiss the complaint "only if it appears to a certainty that the plaintiff will not be able to assert a colorable claim of subject matter jurisdiction." Iwanowa v. Ford Motor Co., 67 F.Supp.2d 424, 438 (D.N.J. 1999).

Factual attacks differ greatly from facial attacks. See Mortenson v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977).

Because at issue in a factual 12(b)(1) motion is the trial court's jurisdiction . . . the trial court is free to weigh the evidence and satisfy itself as to the existence of its power to hear the case. In short, no presumptive truthfulness attaches to plaintiff's allegations, and the existence of disputed material facts will not ...

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