Opinion
No. CV-01-1847-HU
June 17, 2002
Glen Ingram Berry, Beaverton, OR, Plaintiff Pro Se.
Michael W. Mosman, United States Attorney, District of Oregon Ronald K. Silver, Assistant United States Attorney, Portland, OR, Jeremy Hendon, Trial Attorney, Tax Division, United States Department of Justice, Washington, D.C., Attorneys for Defendants.
FINDINGS RECOMMENDATION
Plaintiff Glen Ingram Berry brings this action seeking "cancellation" of the federal tax lien identified in the caption of his Complaint. As individual defendants, plaintiff names Paul H. O'Neill, Secretary of the Treasury, and John Doe who presumably signed the lien for S. Kilpatrick, who is identified in the caption of the Complaint as "Delegate of the Secretary." Plaintiff also seeks to bring criminal charges against defendants for their conduct in filing the notice of the lien.
Although Berry identifies himself as the "Complainant" in the caption, I will refer to him as plaintiff.
Although plaintiff states that a copy of the lien at issue is attached to his Complaint at Exhibit C, no documents of any sort were attached to the Complaint.
The action was originally filed in Washington County Circuit Court. Defendants removed the action to this court on December 21, 2001, pursuant to 28 U.S.C. § 1442(a)(1), which allows removal to federal court for actions against the United States, any agency thereof, or any officer of the United States or any agency thereof. Presently before the court are plaintiff's motion to remand, plaintiff's motion to strike, plaintiff's petition for declaratory relief, and defendants' motion to dismiss. I deny plaintiff's motion to strike. I recommend that plaintiff's motion to remand and petition for declaratory relief be denied and that defendants' motion be granted.
I. Plaintiff's Motion to Remand
It appears that plaintiff initially filed this motion on December 28, 2001, in Washington County Circuit Court. The motion was then filed in this court on January 8, 2002 (docket #5). On January 16, 2002, plaintiff filed another motion with the same caption (docket #10). The documents appear identical except for the dates plaintiff signed them. In addition, on March 4, 2002, plaintiff filed another document entitled "Demand for Subjection Matter Jurisdictional Authority" or in the alternative, Demand for Remand, addressing the court's jurisdiction and seeking remand (docket #18). I have examined all three of these documents, as well as defendants' responses, in addressing the remand issues.
Clearly, on the basis of the caption of the Complaint and the allegations contained within it, defendant Paul O'Neill is an officer of an agency of the United States. Additionally, John Doe and S. Kilpatrick, as Internal Revenue Service (IRS) employees, are also apparently officers of an agency of the United States.
As noted above, 28 U.S.C. § 1442(a)(1) allows removal of any action commenced against any officer of the United States or any agency thereof, for an act committed under the color of his or her office, from a state court to the United States District Court in which the state court sits. See Richards v. Harper, 864 F.2d 85, 86 (9th Cir. 1988) (officers of the United States may remove action against them to federal court under section 1442). "[T]he right of removal is absolute for conduct performed under color of federal office[.]" Arizona v. Manypenny, 451 U.S. 232, 242 (1981).
In seeking remand, plaintiff suggests that the individuals listed as defendants in the caption of the Complaint are not actually named as defendants. Plaintiff argues that this case is brought "in rem" and that O'Neill, the John Doe, and Kilpatrick are not being sued civilly as defendants and thus, are without standing to remove the action to this court.
I reject plaintiff's argument. "As a general rule, a district court deciding whether to exercise removal jurisdiction must consider only the allegations in the complaint [.]" Parrino v. FHP, Inc., 146 F.3d 699, 704 (9th Cir. 1998). The Complaint filed by plaintiff identifies O'Neill, the John Doe, and possibly Kilpatrick as defendants in the action. As such, removal by them was proper. In his March 4, 2002 filing, plaintiff indicates that the United States is not a party to the action. First, because plaintiff names individual officers of the United States as defendants, removal is proper on that basis alone, even without the United States named as a party. Furthermore, to the extent these individual defendants are sued in the official capacities, an action against them is viewed as one against the United States. See Kentucky v. Graham, 473 U.S. 159, 166 (1985) ("official-capacity suit is, in all respects other than name, to be treated as a suit against the entity");Gilbert v. DaGrossa, 756 F.2d 1455, 1458 (9th Cir. 1985) (suit against Internal Revenue Service employees in their official capacities is a suit against the United States). Second, because plaintiff challenges a federal tax lien and the IRS, an agency of the United States, issues such tax liens, the United States may be viewed as a party.
Next, plaintiff contends that exclusive jurisdiction of this action rests in various state courts in Oregon, Florida, or Idaho. In support, he cites various provisions of the Florida Constitution and Florida statutes. Without citing to specific provisions, he also states that he relies on the constitutions and laws of Idaho and Oregon.
This argument is without merit. Regardless of what the state constitutions and state law might provide, under the Supremacy Clause of the United States Constitution, these state constitutions and laws cannot limit the effect of federal statutes. See City of Auburn v. Owest, 260 F.3d 1160, 1175 (9th Cir. 2001) (Supremacy Clause invalidates state laws that interfere with, or are contrary to, federal law), cert. denied, 122 S.Ct. 809 (2002); Begay v. Kerr-McGee Corp., 682 F.2d 1311, 1315 (9th Cir. 1982) (states have no power to enlarge or contract federal jurisdiction and state rules "will not be applied to thwart the purposes of statutes of the United States") (internal quotation omitted).
Next, plaintiff refers to 28 U.S.C. § 2283 and argues that it is a bar to "interfering in a state court action without both personal and subject matter jurisdictions[.]" Pltf's Mtn to Remand at p. 10 (docket #10). However, as defendants note, section 2283 is inapposite. That statute prohibits a federal court from enjoining state court proceedings except in limited circumstances. It has no effect on removal jurisdiction.
Plaintiff also cites to 28 U.S.C. § 2284. This statute is also inapposite for it governs the appointment of a three-judge court. It provides that a three-judge court is required when an action is filed challenging the constitutionality of the apportionment of congressional districts or the apportionment of any statewide legislative body, or when "otherwise required by Act of Congress." 28 U.S.C. § 2284(a). Such claims are not at issue here.
Plaintiff next contends that this court has no jurisdiction because defendants have failed to provide a "scope certification" demonstrating that defendants are truly United States officers. I reject this argument. First, I take judicial notice of the fact that Paul O'Neill is the Secretary of the Treasury and thus, is an officer of the United States. Second, the government cannot provide a "scope certification" of the John Doe because he is, as of yet, unnamed. Third, at this point, it is unclear whether S. Kilpatrick is actually a named defendant.
More importantly, I see no requirement that defendants provide a "scope certification" in this action. Although plaintiff does not refer to any particular statute, my research shows that the scope certification statute is part of the Federal Tort Claims Act. Specifically, it appears at 28 U.S.C. § 2697(d)(1) and provides that the Attorney General of the United States may certify that a defendant employee was acting within the scope of his or her office at the time the incident upon which the tort claim is based arose, and that any proceeding commenced upon the tort claim is deemed an action against the United States and the United States shall be substituted as a party. Because this is not a tort claim, the scope certification has no applicability. See Billheimer v. Louderback, No. C-3-00-574, 2001 WL 429806, at *1 (S.D. Ohio Mar. 3, 2001) (in case where plaintiff sued IRS employee in an attempt to cancel federal tax lien on certain property, plaintiff was not entitled to a scope certification because action properly viewed as tax claim against the United States), magistrate's report adopted, 2001 WL 1346657 (S.D. Ohio Sept. 11, 2001).
Plaintiff's suggestion that the United States has failed to qualify or verify any of its pleadings is without foundation. Defendants have not offered any evidence or testimony to the court requiring verification and counsel's signature on the pleadings and other documents it has submitted is sufficient.
Finally, plaintiff's other arguments that he is not subject to the federal tax laws or not within the scope of federal officials' authority is not properly raised in the context of a motion to remand. Because all of plaintiff's arguments are unavailing and removal was proper under section 1442(a), I recommend that plaintiff's motion to remand be denied.
II. Plaintiff's Motion to Strike
Plaintiff moves to strike defendants' motion to remand because the caption of the motion spells plaintiff's name in all upper case letters. Plaintiff contends that such a spelling "misidentifies [plaintiff] as being the Trustee of a constructive trust created by the party filing the paper[.]" Pltf's Mtn to Strike at p. 2. Plaintiff's motion is without merit. See Russell v. United States, 969 F. Supp. 24, 25 (W.D. Mich. 1997) (argument that summons was invalid because it spelled plaintiff's name in all capital letters was "without merit, patently frivolous, and will be rejected without expending any more of this Court's resources on [its] discussion.") (internal quotation omitted); United States v. Washington, 947 F. Supp. 87, 92 (S.D.N.Y. 1996) (rejecting as baseless criminal defendant's argument that indictment against him must be dismissed because his name was spelled in all capital letters); see also Local R. 10.2(c) (suggesting in a "practice tip" that actual names of parties be capitalized and bolded). The motion to strike is denied.
III. Plaintiff's Petition for Declaratory Relief
In plaintiff's petition for declaratory relief (docket #12), and supplemental petition for declaratory relief (docket #14), plaintiff seeks the court's declaration as to several items including "[t]he status of the Petition in law and under the principals of law[,]" citations to the federal statutes which impose an income tax upon plaintiff, citations to the federal statutes which allow the IRS to impose and collect taxes from petition, the "contract" that plaintiff entered which allowed him to be subject to the IRS's authority, the legality of the lien, whether the lien was authorized by a valid court order from a court of competent jurisdiction, and whether the court has subject matter jurisdiction.
Several of plaintiff's requests are inappropriate. For example, the court does not "declare" the citation to federal statutes governing tax matters. As defendant notes, although courts must liberally construe pro se filings and are obligated to explain certain defects in such filings, plaintiff must still perform his own legal research. As to the declarations sought relating to federal taxes, I lack authority to issue a declaratory judgment as to those questions under 28 U.S.C. § 2201(a). Finally, other declarations sought by plaintiff are simply not ripe for consideration at this stage of the proceedings. I recommend that plaintiff's petition for declaratory relief be denied.
IV. Defendants' Motion to Dismiss
Defendants move to dismiss this action based on a lack of jurisdiction. As explained in Gilbert, and many other cases, the United States is a sovereign, and, as such, is immune from suit unless it has expressly waived such immunity and consented to be sued. Gilbert, 756 F.2d at 1458 (citing, inter alia, United States v. Shaw, 309 U.S. 495, 500-01 (1940)). Such waiver cannot be implied, but must be unequivocally expressed. Id. "Where a suit has not been consented to by the United States, dismissal of the action is required." Id.
Moreover, a waiver "must be construed strictly in favor of the sovereign" and may not be enlarged beyond the requirements of the language waiving the immunity. United States v. Nordic Village, Inc., 503 U.S. 30, 34 (1992). The sovereign immunity of the United States extends to federal employees acting in their official capacities.Gilbert, 756 F.2d at 1458. Plaintiff has the burden of showing "an unequivocal wavier of sovereign immunity." Baker v. United States, 817 F.2d 560, 562 (9th Cir. 1987).
Under 26 U.S.C. § 6320 and 6330, a taxpayer who wishes to contest federal tax liens must request a hearing before an IRS appeals officer within thirty days after the taxpayer is sent notice of the lien. Once the appeals officer has made a determination, the taxpayer has a further thirty days to petition the United States Tax Court or the United States District Court for review of the decision. 26 U.S.C. § 6330(d)(1).
26 U.S.C. § 6320 applies to tax liens while 26 U.S.C. § 6330 applies to tax levies. Section 6320(c) provides for judicial review as delineated by Section 6330(d).
The statutes reveal a limited waiver of the United States's sovereign immunity. That is, the government has consented to be sued, in one of two courts depending on the nature of the tax liability at issue, but only if the taxpayer has first proceeded through the administrative process. Here, plaintiff has not alleged that he requested a hearing, that a hearing was held, or that the IRS made an administrative determination regarding his challenge to the lien. As a result, this court lacks jurisdiction over plaintiff's claim.
And, as defendants note, while district courts ordinarily have jurisdiction over refund suits under 28 U.S.C. § 1346(a), plaintiff fails to allege that he has paid his tax liability or that he has filed an administrative claim for refund. See 26 U.S.C. § 6511, 7422(a). Thus, even if plaintiff were attempting to assert a refund claim, this court would lack jurisdiction over such an action.
An additional basis for dismissal exists by virtue of the Anti-Injunction Act, 26 U.S.C. § 7421(a), which expressly prohibits a taxpayer from bringing suit in order to restrain the assessment or collection of a tax. The Act was passed to ensure that once a tax has been assessed, the tax can be collected without judicial intervention.See Enochs v. Williams Packaging Navigating, Co., 370 U.S. 1, 7 (1962). The taxpayer's only recourse in this situation is to seek a refund for any contested taxes after paying them in full. See Bob Jones Univ. v. Simon, 416 U.S. 725, 736-37 (1974). Because a federal tax lien is a device by which the IRS seeks to "collect" a tax, and because plaintiff seeks to "cancel" that lien in this case, the instant action is properly viewed as one to restrain the collection of a tax and thus, is prohibited by the Anti-Injunction Act.
There are, however, two exceptions to this general rule. An injunction may be maintained when the taxpayer can show that the government cannot, under any circumstances, prevail on the merits of the tax claim, and, when there is a threat of irreparable harm to the taxpayer for which the taxpayer has no legal remedy. See Enochs, 370 U.S. at 7. Neither of these conditions are present in plaintiff's case.
Finally, plaintiff's attempt to bring criminal charges for the crimes of fraud or collusion based on the filing of the notice of the tax lien must be dismissed. Private citizens may neither bring a direct criminal action against another person nor may they petition the federal courts to compel the criminal prosecution of another person. See Maine v. Taylor, 477 U.S. 131, 137 (1986) (private parties have no legally cognizable interest in the prosecutorial decisions of the federal government); Linda R.S. v. Richard D., 410 U.S. 614, 619 (1973) ("a private citizen lacks a judicially cognizable interest in the prosecution or nonprosecution of another.").
I recommend that plaintiff's criminal claims be dismissed for failure to state a claim and that the rest of the Complaint be dismissed for lack of subject matter jurisdiction.
CONCLUSION
I recommend that plaintiff's motion to remand (#10) and petition for declaratory relief (#12), be denied. I recommend that defendant's motion to dismiss (#16) be granted. I deny plaintiff's motion to strike (#6). The dismissal of the criminal claims should be with prejudice because plaintiff can provide no set of facts in support of thos claims. The dismissal of the remainder of the action should be without prejudice to plaintiff alleging, in an amended complaint, facts in support of jurisdiction, that is, facts showing that he timely requested a hearing, a hearing was held, and that he timely appealed the determination of the IRS officer to this court. If plaintiff cannot truthfully allege such facts, an amended complaint filed by him will be subject to dismissal for the reasons explained herein.
Furthermore, because plaintiff failed to attach a copy of the lien notice to his Complaint as indicated, I cannot discern the nature of the tax liability at issue on this record. Defendants represent that the tax owing is income tax. If so, even if plaintiff were able to show that he timely requested a hearing and appealed from an IRS determination regarding the lien, the Tax Court has exclusive jurisdiction over such an appeal. 26 U.S.C. § 6330(d)(1)(B); Johnson v. Commissioner, No. CV-99-6250-TC, 2000 WL 1041191, at *3 (D. Or. June 21, 2000) (Tax Court has exclusive jurisdiction of cases addressing tax liabilities based on nonpayment of income tax).