FDIC v. Meyer
510 U.S. 471 (1994)
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Rule of Law:
A Bivens-type cause of action for damages arising from a constitutional violation cannot be implied directly against a federal agency, even where Congress has waived the agency's sovereign immunity through a "sue-and-be-sued" clause.
Facts:
- Fidelity Savings and Loan Association (Fidelity) was a California-chartered thrift institution.
- In 1982, state and federal regulators seized the failing institution and appointed the Federal Savings and Loan Insurance Corporation (FSLIC) as its receiver.
- John H. Meyer was a senior officer at Fidelity.
- As part of its general policy of terminating senior management of failed thrifts, FSLIC, through its special representative Robert L. Pattullo, summarily discharged Meyer.
- Meyer was terminated from his employment without receiving any prior notice or a hearing.
Procedural Posture:
- John H. Meyer sued FSLIC and its employee, Robert L. Pattullo, in the U.S. District Court for the Northern District of California, claiming his termination violated his Fifth Amendment due process rights.
- A jury returned a verdict for $130,000 against FSLIC but found in favor of Pattullo on the basis of qualified immunity.
- The Federal Deposit Insurance Corporation (FDIC), as FSLIC's successor, appealed the judgment to the U.S. Court of Appeals for the Ninth Circuit.
- The Ninth Circuit affirmed, holding that FSLIC's 'sue-and-be-sued' clause waived its sovereign immunity and that this waiver created a cause of action for damages.
- The U.S. Supreme Court granted certiorari to review the Ninth Circuit's decision.
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Issue:
Can a Bivens cause of action for damages, traditionally available against individual federal agents for constitutional violations, be implied directly against a federal agency?
Opinions:
Majority - Justice Thomas
No. A Bivens cause of action cannot be implied directly against a federal agency. The Court's analysis proceeds in two distinct steps. First, it addresses whether the government waived sovereign immunity. The Court finds that Meyer's constitutional tort claim is not 'cognizable' under the Federal Tort Claims Act (FTCA) because the FTCA's liability is based on state law where a private person would be liable, whereas constitutional torts arise from federal law. Because the FTCA's exclusivity provision does not apply, FSLIC's broad 'sue-and-be-sued' clause does act as a waiver of sovereign immunity, meaning the agency can be brought into court. However, the Court emphasizes that a waiver of immunity is distinct from the existence of a substantive cause of action. Second, the Court declines to extend the Bivens remedy from individual agents to federal agencies for three main reasons: (1) Bivens was created in part because a direct action against the government was unavailable, so extending it would contradict the decision's original premise; (2) the core purpose of Bivens is to deter individual officers, and allowing suits against agencies would eliminate this deterrent effect as plaintiffs would bypass individuals who can claim qualified immunity; and (3) creating a new damages remedy against federal agencies would create a 'potentially enormous financial burden' on the government, a policy decision best left to Congress, constituting a 'special factor counselling hesitation.'
Analysis:
This decision solidifies the critical distinction between a waiver of sovereign immunity (a jurisdictional issue) and the existence of a substantive cause of action (a merits issue). By refusing to extend Bivens to federal agencies, the Court significantly curtailed the expansion of implied constitutional tort remedies and reinforced the remedy's original purpose: deterring individual officer misconduct. The ruling also underscores the principle of judicial restraint, deferring to Congress on matters of federal fiscal policy and the creation of new forms of government liability. This holding effectively channels claims of constitutional violations by federal employees toward suits against the individuals responsible, preserving the doctrine of qualified immunity as a central element in such litigation.
