Opinion
2181-15W
05-24-2024
DAVID T. MYERS, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER OF DISMISSAL
Tamara W. Ashford Judge
Following petitioner's appeal of our Order of Dismissal for Lack of Jurisdiction, the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) reversed and remanded this case for further proceedings. Currently pending before the Court are respondent's Motion to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted, petitioner's Motion to Impose Sanctions, and petitioner's Motion to Declare 26 U.S.C. § 7443(f) Unconstitutional. For the reasons discussed below, we will grant respondent's motion and deny petitioner's motions.
Background
Petitioner commenced this whistleblower case pursuant to section 7623(b)(4).Respondent moved to dismiss this case for lack of jurisdiction on the ground that petitioner had failed to file his Petition (which he later amended) within the 30-day period prescribed by section 7623(b)(4). Petitioner filed a Notice of Objection to Motion to Dismiss for Lack of Jurisdiction. The parties subsequently supplemented their respective filings, and the Court held a hearing on respondent's motion (as supplemented).
Unless otherwise indicated, statutory references are to the Internal Revenue Code, Title 26 U.S.C., in effect at all relevant times.
By Order of Dismissal for Lack of Jurisdiction and pursuant to our Opinion in Myers v. Commissioner (Myers I), 148 T.C. 438 (2017), rev'd and remanded, 928 F.3d 1025 (D.C. Cir. 2019), we granted respondent's motion (as supplemented) and dismissed this case for lack of jurisdiction. Petitioner appealed our Order of Dismissal for Lack of Jurisdiction. The D.C. Circuit reversed and remanded the case, stating that "we agree with the Tax Court's conclusion that Myers's petition was not timely filed under § 7623(b)(4), reverse its dismissal for want of jurisdiction, and remand the case for the Tax Court to decide whether Myers is entitled to equitable tolling." Myers v. Commissioner (Myers II), 928 F.3d 1025, 1037 (D.C. Cir. 2019).
Following remand, respondent filed an Answer to Petition, As Amended. In this filing respondent set forth affirmative allegations concerning the untimely filing of the Petition and asserted that "[b]ecause the petition was not timely filed, petitioner fails to state a justiciable cause of action and otherwise does not meet the statutory conditions for relief under 26 U.S.C. § 7623." Petitioner then filed a document titled "Reply to Answer to Amended Petition." Despite the D.C. Circuit's agreement with this Court that the Petition was not timely filed, in this filing petitioner merely asserted that respondent's affirmative allegations were "statement[s] of law to which no reply is required" and "[t]o the extent a reply is required such is denied and/or denied for lack of knowledge." Petitioner's filing included no facts whatsoever demonstrating that he is entitled to equitable tolling with respect to the filing deadline in section 7623(b)(4).
Thereafter, respondent filed a Motion for Judgment on the Pleadings, alleging that "petitioner did not timely file his petition in this case and has not alleged facts sufficient to establish a basis for tolling of the statutory filing deadline." Based upon the relief sought by respondent, we have recharacterized this motion as a Motion to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted.
At the Court's direction, petitioner filed an Opposition to Motion for Judgment on the Pleadings, which we have recharacterized as an Opposition to Motion to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted. In this filing petitioner contends that respondent has forfeited or waived any affirmative defense related to the timeliness of the Petition in this case. Petitioner further contends that as a result of respondent's waiver or forfeiture, he is under no obligation to demonstrate his entitlement to equitable tolling. On the same day petitioner also filed a Motion to Impose Sanctions, arguing that respondent should be sanctioned for presenting to the Court "legally and/or factually unsupportable filings."
Thereafter, petitioner filed a Motion to Declare 26 U.S.C. § 7443(f) Unconstitutional. In this filing petitioner argues that the "for cause" restriction contained in section 7443(f) with respect to the President's removal powers over Tax Court judges should be declared unconstitutional.
Discussion
I. Petitioner's Motion to Declare 26 U.S.C. § 7443(f) Unconstitutional
First, we address petitioner's Motion to Declare 26 U.S.C. § 7443(f) Unconstitutional and the argument therein that the "for cause" restriction contained in section 7443(f) with respect to the President's removal powers over Tax Court judges should be declared unconstitutional. Section 7443(f) provides: "Judges of the Tax Court may be removed by the President, after notice and opportunity for public hearing, for inefficiency, neglect of duty, or malfeasance in office, but for no other cause." While acknowledging that existing precedent does not support his position, petitioner challenges the constitutionality of this removal provision by arguing that the "for-cause restriction on the President's removal powers over Tax Court judges violates the Constitution by preventing the President from exercising the exclusive duty to 'take Care that the Laws be faithfully executed.'"
This Court has previously considered the constitutionality of section 7443(f) and concluded that it passes muster. Battat v. Commissioner, 148 T.C. 32, 52 (2017) ("regardless of the branch location of the Tax Court, provisions authorizing removal of Tax Court Judges are constitutional"). Furthermore, over the past year the same or similar constitutional argument now under consideration has been espoused by taxpayers in a number of other Tax Court cases, and this Court has rejected those arguments. See, e.g., Order, Battat v. Commissioner, No. 17784-12 (T.C. Nov. 6, 2023); Order, Berkun v. Commissioner, No. 22550-17 (T.C. Oct. 30, 2023); Order, Curtin v. Commissioner, No. 32212-15 (T.C. Aug. 1, 2023).
Petitioner's counsel of record here is the same counsel of record in those other cases.
Despite taking a different intellectual path, the D.C. Circuit (to which, absent a stipulation, all whistleblower cases are appealable pursuant to section 7482(b)) has twice reached the same conclusion concerning the constitutionality of section 7443(f). See Crim v. Commissioner, 66 F.4th 999, 1001 (D.C. Cir. 2023) (finding that the 2015 amendment to section 7441 does not "undermine[] the separation of powers analysis adopted in Kuretski"), aff'g T.C. Memo. 2021-117; Kuretski v. Commissioner, 755 F.3d 929, 939 (D.C. Cir. 2014) (finding that removal under section 7443(f) "would be entirely consistent with separation-of-powers principles"). We see no grounds to depart from our precedent. Accordingly, petitioner's Motion to Declare 26 U.S.C. § 7443(f) Unconstitutional shall be denied.
II. Respondent's Motion to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted
Next, we address respondent's Motion to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted. Under section 7623(b)(4), a person may petition this Court for review of a notice of determination concerning a whistleblower award. In Myers II, the D.C. Circuit held that the 30-day deadline for filing such a petition is a procedural requirement that is not jurisdictional. We thus have authority to consider a late-filed petition in a whistleblower case where the Commissioner raises the issue of timeliness, provided that the person shows that he is entitled to equitable tolling. To be entitled to equitable tolling, that person has the burden of establishing that he pursued his rights diligently and that extraordinary circumstances prevented him from timely filing his petition. See Menominee Indian Tribe of Wisc. v. United States, 577 U.S. 250, 255-57 (2016).
Throughout the proceedings in this Court, respondent has consistently raised the issue of the untimeliness of the Petition as a bar to relief in this case. Petitioner, relying on Daingerfield Island Protective Soc. v. Babbitt, 40 F.3d 442 (D.C. Cir. 1994), argues, however, that because respondent's filings do not mention the specific phrases "affirmative defense" and/or "statute of limitations" respondent has waived the affirmative defense that his late-filed Petition is a bar to relief. Petitioner's reliance on Daingerfield is misplaced. In that case, the D.C. Circuit held that mere boilerplate language stating that "[p]laintiffs' claims are barred by the applicable statute of limitations" was sufficient to preserve the affirmative defense of the statute of limitations. The D.C. Circuit, however, did not establish any requirement concerning specific words or phrases that must be used to preserve such a defense.
Respondent has presented substantially more than mere boilerplate language in this case alleging that the untimeliness of the Petition bars relief for petitioner. We therefore conclude that respondent has not waived the affirmative defense relating to the untimeliness of the Petition. Furthermore, notwithstanding any issue of potential waiver, the D.C. Circuit in Myers II specifically directed this Court to decide whether equitable tolling applies in this case.
Petitioner has offered no explanation for the untimeliness of his Petition nor alleged any facts to support his entitlement to equitable tolling, despite several opportunities to do so since Myers II was issued. Under these circumstances, we conclude that this case shall be dismissed because the Petition was not timely filed pursuant to section 7623(b)(4).
III. Petitioner's Motion to Impose Sanctions
Finally, based upon the discussion above, we conclude that respondent's Motion to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted, as well as respondent's other filings in this case, are not, contrary to petitioner's belief, "legally and/or factually unsupportable filings." Accordingly, petitioner's Motion to Impose Sanctions shall be denied. Upon due consideration, it is hereby
ORDERED that petitioner's Motion to Declare 26 U.S.C. § 7443(f) Unconstitutional is denied. It is further
ORDERED that petitioner's Motion to Impose Sanctions is denied. It is further
ORDERED that respondent's Motion to Dismiss for Failure to State a Claim upon Which Relief Can Be Granted is granted and this case is dismissed.