Opinion
Civil Action No. SA-04-CA-0612.
August 11, 2004
ORDER DENYING PETITIONER'S MOTION TO REVIEW
On this day came on to be considered Petitioners' Motion to Review this Court's July 19, 2004 Order. A summary must first be made of Petitioners' past filings of meritless claims.
I. Petitioners' History of Filing Claims that Lack Legal Merit
A. 1989 Tax Return
Petitioners have a history of filing various claims against the Internal Revenue Service ("IRS"). In 1989, they refused to provide information to the IRS about their income and expenses. The IRS assessed various amounts as taxes and penalized them for filing a frivolous return. They subsequently filed suit in Tax Court, and after they refused to follow Orders from the Tax Court their suit was dismissed. They also filed suit in the district court complaining about the $500 penalty assessed against them for filing a frivolous tax return. The court granted summary judgment in favor of the IRS. Notably, the Court ruled that Petitioners reside in the State of Texas and are therefore subject to the federal tax laws. Sochia v. U.S., 1993 WL 721286 at *3 (W.D. Tex. Oct. 27, 1993). Relying upon the Federalist Papers and invoking "natural law", the Sochias appealed both matters to the Fifth Circuit. Fifth Circuit Nos. 93-5601 and 93-8805.
The Fifth Circuit concluded that the Sochias' pleadings clearly failed to satisfy the requirements of the Tax Court. In addition, the Fifth Circuit concluded that the Sochias' remaining issues "totally lack merit and require no comment." The Fifth Circuit went on to uphold the penalty assessed against the Sochias because of the "frivolous position" advanced by them. Finally, double costs in the appeals were assessed against them. Sochia v. United States, 23 F.3d 941 (5th Cir. 1994), cert. denied, 513 U.S. 1153 (1995).
B. 1990-1991 Tax Returns
In a petition filed by the Sochias in the United States Tax Court, the Petitioners alleged that with regard to their 1990 and 1991 tax returns, they were residents and citizens of Texas and were not subject to United States income taxes; that they filed "Fifth Amendment" returns of income and were justified in doing so; and that the U.S. tax system is voluntary and petitioners have not elected to file returns thereunder. In rejecting their claims, the Tax Court noted Petitioners' "contentions are stale ones, long settled against them. As such, they are frivolous." Sochia v. U.S., 70 T.C.M. (CCH) 913, 1995 WL 581089 (Oct. 4, 1995).
C. 1993-1994 Tax Returns
Petitioners filed a Form 1040 for 1993 on or about April 15, 1994. Most of the lines on that form (including line 31, adjusted gross income) were completed with the words "Object — 5th Amend." However, petitioners included numbers for a business loss on line 12. On April 19, 1995, petitioners sent to the IRS a document entitled "joint income tax return, 1994". This document was not a Form 1040 but was a document generated by Petitioners. Petitioners argued again to the Tax Court that Federal income taxes violate various amendments of the U.S. Constitution and that so-called "Fifth Amendment returns" are valid. The Tax Court rejected all their claims. T.C. Memo. 1998-294, 1998 WL 470664. Further, the Tax Court exercised its discretion under section 6673(a)(1) and ordered Petitioners to pay a penalty to the United States in the amount of $5,000 for each of the years at issue.
D. 1994-1995 Tax Years
"Between January and July 1994, the IRS sent five preliminary collection notices and two delinquent tax notices to the Sochias. Continued nonpayment by the Sochias compelled the IRS to issue a `Notice of Levy' in October 1994 to financial institutions where plaintiffs maintained their savings and retirement accounts. One month later, the San Antonio Teachers Credit Union disbursed a check to the IRS, drawn on the Sochias' account, for $22,675.95. In August 1995, the Sochias filed an `Administrative Appeal for Funds Illegally Assessed and Collected by Levy' with the IRS. Plaintiffs claimed a tax refund for three reasons: (1) the IRS cannot compel citizens to file tax returns; (2) the IRS cannot file a `Substitute Form 1040' and use this as a basis for assessing tax liability; and (3) the IRS failed to comply with the statutory `Notice and Demand' requirements before levying on the taxpayers' property." Sochia v. U.S., 1997 WL 375315 *1, No. 96-555 (Fed.Cl. April 2, 1997). The Court of Federal Claims concluded that it lacked subject matter jurisdiction over the Sochias' action and granted the Government's motion to dismiss.
E. 1998 Lawsuit
On December 3, 1998, Petitioners again filed a complaint in the Western District of Texas. 98-CV-1100. The case was unpublished, and the records from that case are in the Court's closed files and were not retrieved for review in this matter. The few records electronically available indicate that the case was summarily dismissed on January 19, 1999. The Fifth Circuit affirmed dismissal based upon the Sochias' failure to pay prior sanctions. 99-50262.
II. Petitioners' Current Lawsuit
On July 12, 2004, Petitioners filed a Petition to Quash various summonses issued by an agent of the IRS. The summonses pertain to records needed to evaluate Plaintiffs' most recent failure to pay federal income taxes. Petitioners again claim that they are not "Subject-Citizens" of the "Federal-Republic's Central Government." Accordingly, they again claim for "reasons of their alienage" (either citizens of the Republic of Texas or the Republic of Massachusetts) that they are not liable for payment of any federal taxes. This Court denied Petitioners' Motions to Quash on July July 19, 2004. In a 27 page, single-spaced typed "Motion to Review the Merits of the `Order'", they now seek a reconsideration of the Court's Order Denying their Motions to Quash. The Court ORDERS Petitioners' Motion to Review STRICKEN for failure to comply with W.D. Texas Local Rule CV-7 (excessive pages and no proposed order submitted).
In the alternative, the Court addresses Petitioners' objections. Petitioners reargue their claims found long ago by numerous courts as stale, frivolous and long-settled. Petitioners also, in conclusory fashion, argue that the IRS agent who caused such summons to be issued was not delegated such authority by the "Federal-Republic", "acted without benefit of law", and that they were not provided with "attested copies." They further seek discovery and a hearing to determine if the IRS agent who issued the various summons "is guilty of committing a crime, or crimes." Further, claiming that judicial authority is passive, they object to the undersigned judge's Order denying their motions to Quash. They seek the undersigned judge's recusal claiming the Court is biased and "attempting to deny, abridge, circumvent, gag, censor and compromise the Petitioners' unalienable rights to speak . . . as guaranteed by The Constitution Of The [Combined By Compact] United, States'. . . ."
Petitioners' objections are without merit. They have made their claims now unsuccessfully for 15 years. They have made their claims to at least five different courts, and their claims have been rejected by all five courts. The Secretary of the Treasury may delegate the authority to issue a summons. 26 U.S.C. §§ 7602, 7701. Petitioners only offer their conclusory statement that Ms. Coogan is not authorized to issue a summons. With regard to the copies of the summons they received, such copies were not required to be attested. Kondik v. U.S., 81 F.3d 655 (6th Cir. 1996).
The IRS has met the prima facie elements of a summons to defeat a motion to quash. The prima facie elements to determine if an IRS summons is enforceable are: "(1) the summons must be conducted pursuant to legitimate purpose; (2) the inquiry must be relevant; (3) the information sought must not already be in the IRS's possession; and (4) the administrative steps must be followed." U.S. v. Cox, 73 F. Supp. 2d 751, 757 (S.D. Tex. 1999). "The government's burden to show relevance is not heavy." Id. at 759. Petitioners' own attachments to their Petition to Quash establish the IRS justification. See also Respondent's Response and Declaration of Beverly J. Coogan filed August 4, 2004. Petitioners' claim that they are "Sovereign Citizens" not liable to pay federal income tax, and they threaten any individual or organization who withholds federal income tax with legal action for theft and illegal conversion.
While claiming that they are "Sovereign Citizens" and not required to pay federal income taxes, the Court notes that Petitioners have had no difficulty enjoying the benefits of U.S. citizenship. One petitioner is a retired school teacher, who taught at institutions that were the recipient of federal funds. The other petitioner is a retired junior college professor, who also taught at an institution that received federal funds. At least one of the petitioners is apparently receiving social security benefits. They use services provided by the U.S. Postal Service. They are protected by members of the U.S. Armed Forces. They have repeatedly sought recourse in the judicial system. They in all likelihood travel upon roads in the interstate highway system. Taxes are understood as necessary in order that the general benefits of government may be secured. Although citizens maintain the right to petition their representatives as to whether their taxes are properly being assessed and spent, with rights and benefits come responsibilities and obligations.
III. Conclusion
The Court ORDERS Petitioners' Motion to Review STRICKEN for failure to comply with W.D. Texas Local Rule CV-7 (excessive pages and no proposed order submitted). In the alternative, Petitioners' objections are OVERRULED and the Motion to Review the Merits is DENIED. Future motions to reconsider will not be considered. If Petitioners wish to appeal the Order denying their Motion to Quash, they are free to do so. The Court again cautions Petitioners that they consider the Fifth Circuit's warning to individuals advancing long defunct arguments to evade paying their federal income taxes. The Fifth Circuit has made it clear courts may impose sanctions on frivolous claims concerning the right of the government to impose a federal income tax. Lonsdale v. Comm'r, 661 F.2d 71, 72 (5th Cir. 1981). IT IS FURTHER ORDERED that inasmuch as Petitioners have been advancing the same frivolous arguments since 1989, the filing by Petitioners of any further frivolous Complaints or Motions may result in (a) the imposition of significant monetary sanctions pursuant to Rule 11, (b) the imposition of an Order barring Petitioners from filing any Complaints or Motions in this Court without first obtaining permission from a District Judge of this Court or a Circuit Judge of the Fifth Circuit, or (c) the imposition of an Order imposing some combination of those sanctions.