Can you sue? Sure. Will you win? Not likely. Government agencies tend to be insulted from liability, for the most part, not the least of which is because, if they didn't, everyone who was unhappy with their personal situations would sue them. You haven't stated any facts which are grounds for a lawsuit.
It sounds like you just ought to call them, pay them, and get a letter clearing it up which you can send to the credit reporting agencies. It doesn't sound like you're suffering from anything they've done. It sound like you're just unhappy about a lot of things. Don't take it out on an agency which, overall, does good work and is overworked.
If they made a mistake, call them and correct it.