Perales-Munoz v. United States

• Court: Court of Appeals for the First Circuit
• Decided: September 2, 2025
• Docket: 22-1670
• Status: Published

Opinion

United States Court of Appeals For the First Circuit

No. 22-1670

ANGEL A. PERALES-MUÑOZ; HELIRIS ROMÁN-RODRÍGUEZ; CONJUGAL PARTNERSHIP PERALES-ROMÁN,

Plaintiffs, Appellants,

v.

UNITED STATES,

Defendant, Appellee,

PHILIP S. CRANE; DOCUMENT AND PACKAGING BROKERS, INC.,

Defendants.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO

[Hon. Jay A. García-Gregory, U.S. District Judge] [Hon. Giselle López-Soler, U.S. Magistrate Judge]

Before

Barron, Chief Judge, Montecalvo and Aframe, Circuit Judges.

Guillermo Ramos Luiña, with whom Despacho Jurídico Ramos Luiña, LLC, was on brief, for appellants.

Steven A. Myers, with whom Brian M. Boynton, Principal Deputy Assistant Attorney General, W. Stephen Muldrow, United States Attorney, and Mark B. Stern were on brief, for appellee. September 2, 2025 MONTECALVO, Circuit Judge. 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.

- 3 - 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.

I. Background1

This case involves a recruiting program that was run by

the National Guard Bureau. The National Guard Bureau is an

administrative agency inside the Department of Defense. 10 U.S.C.

§ 10501(a). It oversees, among other things, the "unit structure,

strength authorizations, and other resources to the Army National

Guard of the United States." Id. § 10503(1). The Army National

Guard is a reserve component of the United States Army. Id.

§ 10105 (setting forth composition of the Army National Guard).

Its purpose as a reserve component is "to provide trained units

and qualified persons available for active duty in the armed

1 We draw the facts from Perales's complaint, documents fairly incorporated into it, and information subject to judicial notice. See Gagliardi v. Sullivan, 513 F.3d 301, 303, 306 (1st Cir. 2008). And since we are evaluating a motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1), we also "may consider whatever evidence has been submitted, such as . . . depositions and exhibits." Carroll v. United States, 661 F.3d 87, 94 (1st Cir. 2011) (alteration in original) (quoting Aversa v. United States, 99 F.3d 1200, 1210 (1st Cir. 1996)).

- 4 - forces, in time of war or national emergency, and at such other

times as the national security may require, to fill the needs of

the armed forces whenever more units and persons are needed than

are in the regular components." Id. § 10102.

In 2005, the National Guard began a program called the

National Guard Recruiting Assistance Program (the "Recruiting

Program"). As the name suggests, the Recruiting Program sought to

help recruit soldiers during then-ongoing military engagements in

the Middle East and Afghanistan. The Recruiting Program offered

bonuses and other financial incentives to recruiter assistants who

successfully recruited civilians to join the Army National Guard.

To help administer the Recruiting Program, the National Guard

Bureau contracted with Docupak, which under the contract was

responsible for recruiting, hiring, and paying recruiter

assistants, as well as administering the bonus incentives to

recruiter assistants for signing new recruits.

Perales was one of the recruiter assistants hired as an

independent contractor by Docupak. He worked as a recruiter

assistant from 2006 to 2012, a period that coincided with his time

serving in the Puerto Rico Army National Guard from 1997 to 2013.

Around 2007, the Army Criminal Investigation Division

("CID"), which is the Army's primary federal law enforcement

agency, began receiving alerts from Docupak about potential fraud

related to the Recruiting Program. The CID soon thereafter

- 5 - launched a full investigation into possible fraud in the Recruiting

Program.

Perales implies that he was one of the subjects of the

CID's investigation and that the CID's investigation caused a

subsequent federal civilian criminal investigation into him. In

2015, Perales was arrested and named as one of two defendants in

three largely identical federal indictments, each charging him

with multiple counts of conspiracy to defraud the United States,

conspiracy to commit wire fraud, wire fraud, and aggravated

identity theft. The essential scheme, according to the

indictments, was that Perales and his alleged co-conspirators

would submit fraudulent bonus reimbursement claims to Docupak

representing that they recruited soldiers that they did not in

fact recruit.

Two years later, the government moved to dismiss the

charges against Perales, stating that he

did violate the rules and regulations of [the Recruiting Program] with respect to how [personal identifying information] of potential recruits was to be obtained, by whom, and how it was to be used. However, after due consideration of the facts and circumstances of this case, the United States moves to dismiss the Indictment in the interests of justice.

The court then dismissed the charges against Perales with

prejudice.

- 6 - In 2019, Perales and his wife, Heliris Román-Rodríguez

("Román"),2 filed largely identical but separate administrative

claims for damages through the Army's internal claims process.

Their claims alleged that the criminal charges against Perales

were prompted by "a faulty and negligent investigation" into the

Recruiting Program, which caused both Perales and Román "severe

mental pain and anguish." The Army issued a letter of denial

regarding these claims in October 2019.

In 2020, Perales, Román, and the Perales-Román Conjugal

Partnership (collectively, "Perales") filed a complaint for

damages against the United States in federal district court.3 We

recount the portions of the case which are relevant to the current

appeal.

Perales's complaint alleged that his indictment and

arrest were the result of CID agents' investigative negligence and

reckless disregard for exculpatory evidence which demonstrated

2 Román's sole connection to this case is through her relationship to Perales. She was not charged in the indictment. 3 At first, Perales also asserted claims against Docupak and Docupak's Chief Executive Officer, Philip S. Crane. Perales later moved to voluntarily dismiss his claims as asserted against Docupak and Crane. While the district court never resolved that specific motion, the court ultimately dismissed the entire case with prejudice, rendering that pending motion moot. Now on appeal, Perales challenges the district court's judgment only with respect to his claims as asserted against the United States.

- 7 - that the Recruiting Program suffered from systemic deficiencies

and Docupak deserved much of the blame for the fraud allegations.

The government moved to dismiss, arguing that the court

lacked subject matter jurisdiction over the case under Federal

Rule of Civil Procedure 12(b)(1). In doing so, it relied on the

so-called "discretionary function exception," which provides that

the FTCA's waiver of sovereign immunity does not extend to claims

"based upon the exercise or performance or the failure to exercise

or perform a discretionary function or duty." 28 U.S.C. § 2680(a);

see Reyes-Colón v. United States, 974 F.3d 56, 58 (1st Cir. 2020).

In other words, the exception bars claims against the United States

based on a federal employee's performance of some function or duty

that potentially requires the exercise of policy discretion. The

government therefore argued that even though Perales brought his

claim under the FTCA -- under which the United States has waived

its sovereign immunity with respect to certain injuries caused by

government employees acting in the scope of their official

employment, see 28 U.S.C. § 1346(b)(1) -- sovereign immunity still

bars his suit because the harm was the product of a discretionary

function. Specifically, the government argued that the CID's

investigation into Perales was an exercise of a discretionary

function under § 2680(a).

In opposition, Perales argued that the discretionary

function exception was inapplicable because it does not cover acts,

- 8 - like the CID's investigation, taken in the absence of legal

authority. In particular, he contended that the CID's

investigative authority was defined and "delimit[ed]" by Army

Regulation 195-2 ("AR 195-2"), which is an Army regulation that

establishes Army policies on criminal investigations. And, in his

view, the CID's investigation exceeded the authority granted to it

by AR 195-2. As such, Perales asserted that the discretionary

function exception cannot apply to the CID's investigation into

him.

The district court ordered limited jurisdictional

discovery on whether the discretionary function exception applied.

The magistrate judge assigned to the case then issued a Report and

Recommendation ("the Report") which examined whether the CID's

investigation in fact violated applicable laws or regulations.

Specifically, the Report analyzed two different legal provisions:

AR 195-2 and the Posse Comitatus Act, 18 U.S.C. § 1385.4 The

Report concluded that the CID's investigation violated neither the

regulation nor the statute, was a valid exercise of policy-rooted

Perales's argument regarding the Posse Comitatus Act was 4

raised for the first time during the jurisdictional discovery phase. As part of the Report's analysis of the Posse Comitatus Act, the magistrate judge also examined Department of Defense Directive 5525.5, a regulation promulgated pursuant to the Department's authority under 10 U.S.C. § 275 to issue regulations to ensure that no "direct participation by a member of the Army, Navy, Air Force, or Marine Corps in a search, seizure, arrest, or other similar activity" is permitted unless "otherwise authorized by law." 10 U.S.C. § 275.

- 9 - discretion, and was therefore protected by the discretionary

function exception. Accordingly, the Report recommended

dismissing the complaint for lack of subject matter jurisdiction.

Perales filed objections to the Report, including to its

conclusion that the CID's investigation did not violate the Posse

Comitatus Act. He did not, however, contest the Report's

conclusion that the investigation did not violate AR 195-2.

The district court adopted the Report in full, dismissed

the complaint, and entered judgment for the defendants.

This timely appeal followed.

II. Standard of Review

We review the district court's dismissal for lack of

subject matter jurisdiction de novo. Town of Barnstable v.

O'Connor, 786 F.3d 130, 138 (1st Cir. 2015). In doing so, we take

all well-pleaded allegations as true and give Perales the benefit

of all reasonable inferences. Hajdusek v. United States, 895 F.3d

146, 148 (1st Cir. 2018). However, the burden of demonstrating

the existence of federal jurisdiction ultimately lies with

Perales, as he is the party seeking to invoke federal jurisdiction.

Murphy v. United States, 45 F.3d 520, 522 (1st Cir. 1995).

III. Discussion

A. The FTCA and the Discretionary Function Exception

We begin with a brief overview of the FTCA and the

discretionary function exception.

- 10 - "As a sovereign, the United States is immune from suit

unless it consents to being sued." Reyes-Colón, 974 F.3d at 58.

Where the United States has not consented to suit, "[f]ederal

courts lack jurisdiction over tort actions against the United

States." Limone v. United States, 579 F.3d 79, 88 (1st Cir. 2009).

Through the FTCA, however, the government has consented to suit in

cases involving alleged injuries caused by government employees

acting within the scope of their employment. 28 U.S.C.

§ 1346(b)(1).

As previously noted, even where the United States has

consented to suit, there are exceptions that nonetheless bar suit

against it. One such exception is the discretionary function

exception, which provides that the government does not consent to

suit on:

[a]ny claim . . . based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused.

Id. § 2680(a). In other words, the discretionary function

exception bars any tort claim against the United States where a

federal government employee, in relation to a tortious act,

exercises some function or duty that potentially requires

exercising some amount of policy discretion. See Reyes-Colón, 974

F.3d at 58-59.

- 11 - This bar, however, does not apply when the

"harm-producing conduct itself is [not] discretionary" because a

federal "'statute, regulation, or policy' . . . dictates 'a course

of action'" that the employee must follow. Mahon v. United States,

742 F.3d 11, 14 (1st Cir. 2014) (quoting Berkovitz v. United

States, 486 U.S. 531, 536 (1988)). The discretionary function

exception accordingly does not "immunize the government from

liability for actions proscribed by federal statute or

regulation." Limone, 579 F.3d at 101; see also Red Lake Band of

Chippewa Indians v. United States, 800 F.2d 1187, 1196 (D.C. Cir.

1986) ("A government official has no discretion to violate the

binding laws, regulations, or policies that define the extent of

his official powers.").

Perales relies on this principle to argue that the FTCA's

discretionary function exception does not apply to the conduct

challenged here because the CID investigation violated binding

federal laws and regulations, namely the Posse Comitatus Act and

AR 195-2.5 The government answers that the CID's investigation

violated neither. For the following reasons, we agree with the

5 The Report also concluded that the Perales-Román Conjugal Partnership failed to exhaust its administrative remedies as required by the FTCA, 28 U.S.C. § 2675(a). Perales renews his argument regarding administrative exhaustion on appeal, but we need not address it because we agree with the district court's conclusion that the federal courts lack jurisdiction to hear any portion of this case.

- 12 - district court that Perales has failed to meet his burden to

establish the existence of federal jurisdiction. We thus affirm

the district court's dismissal of the case on the ground that the

federal courts lack jurisdiction to resolve any portion of this

case.

B. Posse Comitatus Act

We begin with the first law that Perales argues that the

United States violated: the Posse Comitatus Act.

The Posse Comitatus Act, first enacted by Congress in

1878, "limit[s] the use of federal troops for domestic law

enforcement purposes." Tirado-Acosta v. P.R. Nat'l Guard, 118

F.3d 852, 853 (1st Cir. 1997); see Act of June 18, 1878, ch. 263,

20 Stat. 152 (1878) (current version at 18 U.S.C. § 1385). The

Act is short, in full providing that:

Whoever, except in cases and under circumstances expressly authorized by the Constitution or Act of Congress, willfully uses any part of the Army, the Navy, the Marine Corps, the Air Force, or the Space Force as a posse comitatus or otherwise to execute the laws shall be fined under this title or imprisoned not more than two years, or both.

18 U.S.C. § 1385.

Insofar as Perales argues that the CID's investigative

conduct that did not involve civilian law enforcement violated the

Act, we disagree. Perales's brief, we think, can be fairly read

to make this argument by suggesting that his case is unlike those

- 13 - in which the CID conducts an investigation "in conjunction with a

civilian law enforcement agency." But his complaint, as the

government notes, lacks any factual allegations that the CID, by

itself, carried out any civilian law enforcement functions such as

arresting Perales, executing search warrants, interviewing

witnesses, or engaging in any other particular investigative steps

which might potentially amount to military "execut[ion of] the

laws" in violation of the Posse Comitatus Act. 18 U.S.C. § 1385.

Absent such allegations, Perales's complaint cannot be construed

to allege the CID's investigation violated the Posse Comitatus

Act.

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. Even supposing that the CID's act of alerting

federal prosecutors about potential crimes could be construed as

using the Army to execute the laws, Perales fails to explain why

CID's conduct was not, as the district court found that it was,

supported by an "independent military purpose,"6 namely,

The source of the "independent military purpose" exception 6

to the Posse Comitatus Act is a Department of Defense regulation. See United States v. Chon, 210 F.3d 990, 994 (9th Cir. 2000)

- 14 - replenishing the ranks of the Army National Guard and safeguarding

Army funds for recruitment, and accordingly, not proscribed by the

Posse Comitatus Act. See United States v. Dreyer, 767 F.3d 826,

833 (9th Cir. 2014); see also Applewhite v. U.S. Air Force, 995

F.2d 997, 1001 (10th Cir. 1993) ("necessarily no wilful [sic] use

of any part of" armed forces "as a posse to execute civilian laws"

where there is "independent military purpose" for the military

investigation); Hayes v. Hawes, 921 F.2d 100, 103–04 (7th Cir.

1990) (courts have required military participation in civilian law

enforcement to be "pervasive" before finding violation of the Posse

Comitatus Act); United States v. Bacon, 851 F.2d 1312, 1313 (11th

Cir. 1988) ("We hold that assistance by the military in civil

investigations, as here, is not a violation of the Posse Comitatus

Act in that the military participation in this case did not pervade

the activities of civilian officials, and did not subject the

citizenry to the regulatory exercise of military power."). 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

(applying Chevron deference). We do not understand Perales to be making any argument that the regulations setting forth this exception contravene the statute or that no such "independent military purpose" exception may be applied under the Act.

- 15 - 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.

C. Army Regulation 195-2

Separately, Perales argues that the CID acted beyond the

scope of its lawful authority by exceeding 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. See M. v. Falmouth Sch. Dep't,

847 F.3d 19, 25 (1st Cir. 2017) ("[O]nly those issues fairly raised

by the objections to the magistrate's report are subject to review

in the district court and those not preserved by such objection

are precluded on appeal." (quoting Keating v. Sec'y of Health &

Human Servs., 848 F.2d 271, 275 (1st Cir. 1988))). Accordingly,

we will not disturb the conclusion below that the CID did not

violate AR 195-2.

D. No Other Asserted Grounds for Jurisdiction

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.

- 16 - IV. Conclusion

For the foregoing reasons, the judgment of the district

court is affirmed.

- 17 -