United States District Court, E.D. Pennsylvania
DANIEL S. PENNACHIETTI, Plaintiff,
CRAIG MANSFIELD, Defendant
J. PAPPERT, J.
Pennachietti received an allegedly usurious loan through an
internet website operated by Sovereign Lending Solutions,
LLC, a title lending company established under the tribal law
of the Lac Vieu Desert Band of Lake Superior Chippewa
Indians. (Compl., at 1-2, ECF No. 1.) Pennachietti has not
sued the Chippewa Tribe or Sovereign. Instead, he has sued
Craig Mansfield, “a manager in charge of day-to-day
operations” at Sovereign. (Ex. P-2, at 2, ECF No. 1-1.)
Mansfield moves to dismiss the Complaint pursuant to Rules
8(a)(1), 12(b)(1), 12(b)(2), and 12(b)(3) of the Federal
Rules of Civil Procedure. (Def.'s Mot. to Dismiss, at 10, 11,
16, 22, ECF No. 5.) For the reasons that follow, the Court
denies Mansfield's Motion.
2013, Pennachietti borrowed $5, 050.00 from Sovereign.
(Compl., at 3.) He submitted his loan application online
through “Title Loan America, ” a website operated
by Sovereign. (Id., Ex. P-1.) Pennachietti does not
recall seeing or accepting any particular terms or conditions
at the time he took the loan, and he was not provided a copy
of the loan agreement. (Id. at 3-4.) Over the next
year, Pennachietti made payments to Sovereign totaling $6,
301.68. (Id. at 4.) He was late making the final, or
“balloon” payment for the outstanding balance on
the loan, and Sovereign had his car was repossessed.
(Id.) Sovereign demanded $7, 000.00 from
Pennachietti to get his car back, which he paid in two
installments in August and October of 2014. (Id.)
Pennachietti filed his Complaint against Mansfield on June 8,
2017, alleging violations of the Racketeer Influences and
Corrupt Organizations Act (“RICO”), 18 U.S.C.
§ 1962(c)-(d) (id. at 5-9), and a violation of
Pennsylvania's Loan Interest and Protection Law, 41 Pa.
Cons. Stat. §§ 201, 502-504 (id. at 9-10).
Count One, Pennachietti alleges Mansfield violated 18 U.S.C.
§ 1962(c), which makes it a crime for “any person
employed by or associated with an enterprise engaged in, or
the activities of which affect, interstate…commerce,
to conduct or participate, directly or indirectly, in the
conduct of such enterprise's affairs through a pattern of
racketeering activity….” Pennachietti identifies
Sovereign as the RICO enterprise, Mansfield as a prior
manager of Sovereign, and alleges Mansfield conducted or
participated in the enterprise's affairs by directing
Sovereign to collect unlawful debt from citizens of
Pennsylvania, including Pennachietti. (Compl., at 6-7.) In
Count Two, Pennachietti alleges Mansfield violated 18 U.S.C.
§ 1962(d), which provides that “[i]t shall be
unlawful for any person to conspire to violate any of the
provisions of subsection (a), (b), or (c) of this
section.” 18 U.S.C. § 1962(d). Pennachietti
contends Mansfield violated § 1962(d) by conspiring with
other individuals to operate an enterprise and collect
unlawful debt from Pennsylvania borrowers. (Id. at
8.) In Count Three, Pennachietti alleges Mansfield collected
interest above the statutory annual maximum of six percent,
in violation of the Loan Interest and Protection Law.
(Id. at 9.) Mansfield argues that the Complaint
should be dismissed because he enjoys tribal sovereign
immunity and that this Court lacks personal jurisdiction over
address issues of tribal sovereign immunity pursuant to
motions to dismiss for lack of subject matter jurisdiction
under Federal Rule of Civil Procedure 12(b)(1). E.F.W. v.
St. Stephen's Indian High Sch., 264 F.3d 1297,
1302-03 (10th Cir. 2001) (“Tribal sovereign immunity is
a matter of subject matter jurisdiction, which may be
challenged by a motion to dismiss under Fed.R.Civ.P.
12(b)(1)”)); cf. United States v. Gov't of
Virgin Islands, 363 F.3d 276, 284 (3d Cir.2004)
(“Eleventh Amendment immunity is relevant to
jurisdiction....”). A motion to dismiss for lack of
subject matter jurisdiction may be asserted as either a
facial or factual attack. A facial attack challenges the
sufficiency of the complaint because of a defect on its face,
and the court “must consider the allegations of the
complaint as true.” Mortensen v. First Fed. Sav.
& Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977).
In a factual attack, the trial court “is free to weigh
the evidence and satisfy itself as to the existence of its
power to hear the case.” Id. Because Mansfield
presents a factual attack, the Court may consider evidence
outside the pleadings, and no presumptive truthfulness
attaches to Pennachietti's allegations. See id.
contends that he is entitled to tribal sovereign immunity
because he acted within the scope of his employment and in
his official capacity as manager at Sovereign, and thus
Sovereign is the real party in interest. (Def.'s Mot. to
Dismiss, 13- 16.)
Lewis v. Clarke, 137 S.Ct. 1285 (2017), the most
recent United State Supreme Court case to address tribal
sovereign immunity, the Court held that “[i]n a suit
brought against a tribal employee in his individual capacity,
the employee… is the real party in interest and the
tribe's sovereign immunity is not implicated.” 137
S.Ct. at 1288. Brian and Michelle Lewis were driving on an
interstate highway when William Clarke, an employee of the
Mohegan Tribe of Indians of Connecticut transporting Mohegan
Sun Casino patrons, struck their car. Id. at 1286.
The plaintiffs sued Clarke in his individual capacity in
state court, and Clarke moved to dismiss the case for lack of
subject-matter jurisdiction, arguing that he was entitled to
tribal sovereign immunity because he was acting within the
scope of his employment at the time of the accident.
Id. The trial court denied Clarke's motion
because “the damages remedy sought was solely against
[the defendant] and would in no way affect the Tribe's
ability to govern itself independently.” Id.
at 1289. The Supreme Court of Connecticut reversed, holding
that “tribal sovereign immunity barred the suit because
[the defendant] was acting within the scope of his employment
when the accident occurred.” Id. The Court
reasoned that “plaintiffs cannot circumvent tribal
immunity by merely naming the defendant, an employee of the
tribe, when the complaint concerns actions taken within the
scope of his duties….” Id. (quoting
Lewis v. Clarke, 320 Conn. 706, 717 (2016)).
United States Supreme Court reversed, holding that tribal
sovereign immunity is not implicated in a suit brought
against a tribal employee in his individual capacity because
the employee is the real party in interest. Id. at
1288. That the defendant “was acting within the scope
of his employment…is not, on its own, sufficient to
bar a suit against that employee on the basis of sovereign
immunity.” Id. Instead, courts must determine
whether tribal sovereign immunity applies by evaluating the
principles of common-law sovereign immunity to decide
“whether the sovereign is the real party in
interest….” Id. at 1290.
Court explained that common-law sovereign immunity
distinguishes between individual and official capacity suits
when determining the real party in interest. Id. at
1291. In an official capacity claim, “the relief sought
is only nominally against the official and in fact is against
the official's office and thus the sovereign
itself.” Id. (citing Will v. Michigan
Dept. of State Police, 491 U.S. 58, 71 (1989)). Because
official capacity claims are essentially actions against the
sovereign, the sovereign is the real party in interest and
immunity may be asserted. Id.; see also Kentucky
v. Graham, 473 U.S. 159, 167 (1985).
capacity suits, however, “seek to impose
individual liability upon a government officer for
actions taken under color of state law.”
Lewis, 137 S.Ct. at 1291 (emphasis added) (quoting
Hafer v. Melo, 502 U.S. 21, 25 (1991)). Upon taking
office, newly elected Pennsylvania Auditor General Barbara
Hafer fired eighteen employees who she believed obtained
their positions by paying a former employee of the Auditor
General's office. The employees sued Hafer in her
personal capacity, seeking money damages under 42 U.S.C.
§ 1983. Hafer, 502 U.S. at 21. Hafer argued
that she was entitled to sovereign immunity because
“liability turns not on the capacity in which state
officials are sued, but on the capacity in which they acted
when injuring the plaintiff.” Id. at 27. The
Court rejected this argument, reasoning that “officers
sued in their personal capacity come to court as individuals,
” and “may be held personally liable for
damages…based upon actions taken in their official
capacities.” Id. at 21, 27. Individuals are
the real party in interest where the plaintiff “seeks
to impose personal liability upon an individual [to] recover
from the personal assets” of that individual, and
sovereign immunity is not implicated because the sovereign is
not the real party in interest. Garden State Electrical
Inspection Services, Inc. v. Levin, 144 Fed.Appx. ...