Jurisdiction – FTCA – Discretionary function

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Where (1) a plaintiff filed a complaint under the Federal Tort Claims Act after criminal charges against him were dismissed with prejudice and (2) a U.S. District Court judge, finding that the discretionary function exception to the FTCA’s waiver of sovereign immunity applied, dismissed the plaintiff’s FTCA claims for lack of subject matter jurisdiction, that decision should be affirmed because the plaintiff has failed to meet his burden to establish the existence of federal jurisdiction.

“Angel A. Perales-Muñoz (‘Perales’) was contracted by Document and Packaging Brokers, Inc. (‘Docupak’), a defense contractor, that helped the United States National Guard Bureau administer a program to find and sign recruits up for the United States Army National Guard. That program caught the attention of the Army’s internal law enforcement agency due to concerns over possible fraudulent conduct in connection with the program. The investigation led to the filing of a series of federal indictments against Perales, and his subsequent arrest. However, two years later, while the charges were still pending, the government moved to dismiss the indictments against Perales. The criminal charges were subsequently dismissed with prejudice.

“Perales responded by filing suit in the United States District Court for the District of Puerto Rico, asserting claims under the Federal Tort Claims Act (‘FTCA’), ch. 753, 60 Stat. 842 (1946) (codified as amended in scattered sections of 28 U.S.C.), based on alleged negligent investigation and seeking damages for the pain and anguish that the investigation and arrest inflicted on him and his family. On a motion to dismiss, however, the district court held that the discretionary function exception to the FTCA’s waiver of sovereign immunity applied, and thus dismissed Perales’s claims for lack of subject matter jurisdiction.

“Perales calls on us now to reverse that finding. He contends that the discretionary function exception does not apply because the Army’s investigation violated federal laws and regulations and that the district court erred in holding to the contrary. But for reasons that follow, we affirm the district court’s determination that the federal courts lack jurisdiction to resolve Perales’s claims. …

“We begin with the first law that Perales argues that the United States violated: the Posse Comitatus Act. …

“Insofar as Perales argues that the [Army Criminal Investigation Division (CID)]’s investigative conduct that did not involve civilian law enforcement violated the Act, we disagree. …

“And to the extent that Perales argues that the CID caused the criminal charges against him by alerting federal law enforcement that Perales might be involved in possible criminal fraud related to the Recruiting Program, as the allegations in his complaint suggest, we still discern no violation of the Posse Comitatus Act. … Thus, even viewed in the most generous light, Perales’s complaint fails to allege that the CID was used to aid the federal prosecution in such a way that could be understood to violate the Posse Comitatus Act.

“For these reasons, we find no violation of the Posse Comitatus Act. Perales’s argument, hinging on the CID’s investigation having violated the Act, thus fails. …

“Separately, Perales argues that the CID acted beyond the scope of its lawful authority by exceeding [Army Regulation (AR) 195-2], which he contends ‘delimits the CID’s [investigative] jurisdiction.’

“Perales, however, failed to preserve his argument regarding AR 195-2 for appellate review. His objections to the magistrate judge’s Report did not address the Report’s extensive analysis of AR 195-2 or its conclusion that AR 195-2 in fact authorized the CID’s investigation. … Accordingly, we will not disturb the conclusion below that the CID did not violate AR 195-2. …

“Perales does not advance any other challenge to the Report’s conclusion that the discretionary function exception bars his claim. We thus conclude that Perales has failed to meet his burden to show that federal jurisdiction exists here.”

Perales-Munoz v. United States, et al. (Lawyers Weekly No. 01-185-25) (17 pages) (Montecalvo, J.) Appealed from the U.S. District Court for the District of Puerto Rico (Docket No. 22-1670) (Sept. 2, 2025).

Click here to read the full text of the opinion.