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recoupment, and denied respondent's motion. We reserved the
issue of petitioner’s entitlement to equitable recoupment relief
for further proceedings, and this case has been tried, submitted,
and briefed for the Court's opinion on the issue of equitable
recoupment.
Subsequent to the filing of the amended petition, the
parties presented no arguments on the issue of statutory
mitigation. It only arose, in a preliminary skirmish that led
nowhere, in Respondent’s Request for Admissions and Petitioner’s
Answer to Respondent’s Request for Admissions.
Discussion
The doctrine of sovereign immunity persists as a
jurisdictional limitation on suits against the United States,
FDIC v. Meyer, 510 U.S. 471, ___, 114 S. Ct. 996, 1000 (1994);
United States v. Dalm, 494 U.S. 596, 608 (1990); United States v.
Forma, 42 F.3d 759, 763 (2d Cir. 1994), and jurisdictional
limitations based on sovereign immunity apply equally to
counterclaims against the Government, United States v. Forma,
supra at 764. Case law, however, has developed a significant
limitation to the general bar of sovereign immunity against
counterclaims: Despite sovereign immunity, a defendant may,
without statutory authority, recoup on a counterclaim that would
otherwise be barred by the statute of limitations an amount not
in excess of the principal claim. Id. (citing United States v.
United States Fidelity & Guaranty Co., 309 U.S. 506, 511 (1940)).
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