United States District Court, D. Connecticut
JOHN J. FLYNN, Plaintiff,
NFS, et al., Defendants.
RULING AND ORDER
R. Underhill United States District Judge
John J. Flynn filed this action in Connecticut Superior Court
against two Securities and Exchange Commission (SEC)
officials; NFS (a/k/a National Financial Services, LLC);
Fiserv, Inc.; and Fidelity Brokerage Services, LLC;
Connecticut State's Attorney Richard Colangelo; and
George Malley. Flynn's claims against all defendants
other than the federal officials were dismissed or resolved
against him by the Connecticut state court. With respect to
the remaining defendants-the SEC officials-Flynn claims that
they (i) violated the Racketeer Influenced and Corrupt
Organization Act (RICO), 18 U.S.C. § 1961 et seq., by
way of a conspiracy to defraud him; (ii) denied his civil and
constitutional rights; and (iii) committed various torts
United States removed the case to this court, and now moves
to dismiss on behalf of the federal defendants pursuant to
Federal Rules of Civil Procedure 12(b)(1), (3), (4), (5), and
The United States argues that Flynn's complaint must be
dismissed for lack of subject matter jurisdiction, improper
venue, insufficient process, insufficient service of process,
and failure to state a claim upon which relief can be
granted. For the following reasons, the motion to dismiss is
Standard of Review
case is properly dismissed for lack of subject matter
jurisdiction under Rule 12(b)(1) when the district court
lacks the statutory or constitutional power to adjudicate
it.” Makarova v. United States, 201 F.3d 110,
113 (2d Cir. 2000). The court must “[c]onstrue all
ambiguities and draw all inferences in [the
plaintiff]'s favor, ” and “may refer to
evidence outside the pleadings.” Id. “A
plaintiff asserting subject matter jurisdiction has the
burden of proving by a preponderance of the evidence that it
exists.” Id. (citing Malik v.
Meissner, 82 F.3d 560, 562 (2d Cir. 1996)). “When
an action is brought against the United States government,
compliance with the conditions under which the government has
agreed to waive sovereign immunity is necessary for subject
matter jurisdiction to exist. Accordingly, the statute of
limitations may operate in suits against the United States .
. . [to] deprive a court of subject matter jurisdiction over
an action that is not timely filed.” Williams v.
United States, 947 F.2d 37, 39 (2d Cir. 1991).
Second Circuit has encouraged courts to “consider
jurisdiction . . . questions first” before determining
whether a complaint states a claim upon which relief can be
granted. See Arrowsmith v. United Press
Internat'l, 320 F.2d 219, 221 (2d Cir. 1963). I hold
that Rule 12(b)(1) requires dismissal of Flynn's
complaint, and therefore do not reach the United States'
arguments under Rules 12(b)(3), (4), (5), and (6).
December 2, 2014, John Flynn filed a pro se
complaint in Connecticut Superior Court against two SEC
officials, Al Lapins and Jack Hardy; NFS (a/k/a National
Financial Services, LLC); Fiserv, Inc.; Fidelity Brokerage
Services, LLC; Connecticut State's Attorney Richard
Colangelo; and George Malley. Flynn's claims against all
defendants other than the SEC officials were dismissed or
resolved against him by the Superior Court. Thereafter, on
August 11, 2016, the United States removed Flynn's suit
to federal court pursuant to 28 U.S.C. § 1442(a)(1),
which permits removal of actions against the “United
States or any agency thereof or any officer . . . of the
United States or of any agency thereof.” See
Notice of Removal, Doc. No. 1. The United States attached to
its notice of removal a certification that stated the SEC
officials were acting within the scope of their employment at
the time of the alleged conduct. See Certification,
Doc. No. 1-4. As a result, the United States has been
substituted as defendant for the SEC officials by operation
of law. See 28 U.S.C. § 2679(d)(2); see
also Farmer v. Perrill, 275 F.3d 958, 963 (10th Cir.
2001) (“[A]ny action that charges such an official with
wrongdoing while operating in his or her official capacity as
a United States agent operates as a claim against the United
complaint alleges that he lost control of his investment
business, Greenwich Global LP (GGLP), and its assets, as a
result of the defendants' conduct. Flynn's claims
against the United States through its officials are
threefold. First, he alleges violations of RICO, 18 U.S.C.
§ 1961 et seq. See Compl., Doc. No. 10-2, at 2.
Flynn states that “[t]he SEC knowingly gave control of
GGLP to a criminal enterprise promising to ruin Flynn
financially. The SEC encouraged the looting of substantially
all GGLP accounts.” Id. at 34. Flynn also
asserts that the SEC “allowed the [National Association
of Securities Dealers, or] NASD directive, ”
id., and “allowed for . . . unauthorized
trades, theft, and money laundering.” Id.
also makes civil rights and constitutional claims, alleging
that the “SEC discriminated against Flynn, ”
id. at 10, “den[ied] Flynn basic civil rights
to property” and “violated Flynn's due
process rights.” Id. at 34. He contends that
the SEC failed to answer or “covered up” 220
complaints that Flynn filed, id. at 16, 20, 25, 28;
“illegally extended immunity” to private parties
that violated his civil rights, id. at 26; and
ignored a court order regarding him. Id.
Flynn claims that the SEC committed torts, including:
misrepresentation, id. at 5 (“SEC examiners
falsely claimed to be investigating for 6 years.”), 24
(“Al Lapins false[ly] claimed to be investigating. . .
. Jack Hardy . . . falsely claimed to investigate the money
laundering”), 34; fraud, id. at 5,
(“falsified a complaint”), 6 (“SEC
falsified an investigation for more than 10 years”), 9
(“SEC made false statements”), 34; assault,
id. at 6 (“security personnel of the SEC
threatened the Plaintiff with bodily injury”), 11
(“Plaintiff reported threats were made from a
non-working number at the [SEC]”), 34 (threats); and
theft, id. at 26 (“Al Lapins robbed GGLP's
CRD deposit account.”), 34 (“SEC . . . stole
doctrine of sovereign immunity holds that “the United
States is immune from suit except to the extent the
government has waived its immunity.” Coulthurst v.
United States, 214 F.3d 106, 108 (2d Cir. 2000). A
waiver of sovereign immunity “must be unequivocally
expressed in the ...