Although the summons power provisions of the Internal Revenue Code are to be liberally construed, a court must be careful to insure that its construction will not result in a use of the power beyond that permitted by law. Justice Harlan acknowledged as much in United States v. Powell, 379 U.S. 48, 58, 85 S.Ct. 248, 255, 13 L.Ed.2d 112, 120 (1964): "It is the court's process which is invoked to enforce the administrative summons and a court may not permit its process to be abused."See, e. g., United States v. Widelski, 452 F.2d 1, 4 (6th Cir. 1971); United States v. Giordano, 419 F.2d 564, 569-570 (8th Cir. 1969), cert. denied, 397 U.S. 1037, 90 S.Ct. 1355, 25 L.Ed.2d 648 (1970); United States v. McKay, 372 F.2d 174, 176 (5th Cir. 1967); DeMasters v. Arend, 313 F.2d 79, 87 (9th Cir. 1963); Falsone v. United States, 205 F.2d 734, 742 (5th Cir.), cert. denied, 346 U.S. 864, 74 S.Ct. 103, 98 L.Ed. 375 (1953); United States v. Northwest Pennsylvania Bank Trust Co., 355 F. Supp. 607, 614 (W.D.Pa. 1973).See United States v. Weingarden, 473 F.2d 454, 458 (6th Cir. 1973); United States v. Pritchard, 438 F.2d 969, 971 (5th Cir. 1971); United States v. Monsey, 429 F.2d 1348, 1351 (7th Cir. 1970); United States v. Michigan Bell Telephone Co., 415 F.2d 1284, 1286 (6th Cir. 1969).
Yet, while the relevancy standard of § 7602(a) is broad, it is not so liberal as to permit the government to "wander at will" through a taxpayer's or trustee's records. See United States v. Northwest Pa. Bank Trust Co., 355 F. Supp. 607, 613 (W.D.Pa. 1973). The government must have some reasonable expectation, rather than idle hopes, that something might be discovered.
The District Courts which have specifically considered a Bank's entitlement to reimbursement for the expenses of compliance with an IRS summons have reached varying conclusions on the issue. Compare United States v. Farmers & Merchants Bank, 397 F.Supp. 418 (C.D.Cal.1975); United States v. Friedman, 388 F.Supp. 963 (W.D.Pa.1975), modified, 532 F.2d 928 (3d Cir. 1976); United States v. Northwest Pennsylvania Bank & Trust Co., 355 F.Supp. 607 (W.D.Pa.1973); United States v. First National Bank, 173 F.Supp. 716 (W.D.Ark.1959), (granting some type of relief to the banks); with United States v. Mellon Bank, 410 F.Supp. 1065 (W.D.Pa.1976); United States v. Bremicker, 365 F.Supp. 701 (D.Minn.1973), and United States v. Jones, 351 F.Supp. 132 (M.D.Ala.1972), (denying relief to the banks). However, of the district court cases granting relief to banks, not all granted the relief of reimbursement for compliance expenditures.
Most use the reasonableness approach, but there's an absence of discussion as to the monetary level at which a burden becomes unreasonable. See United States v. Dauphin Deposit Trust Co., 385 F.2d 129 (3d Cir. 1967), cert. denied, 390 U.S. 921, 88 S.Ct. 854, 19 L.Ed.2d 981 (1968); United States v. Pittsburgh Nat'l Bank, 388 F.Supp. 963 (W.D.Pa.1975); United States v. Northwest Pa. Bank & Trust Co., 355 F.Supp. 607 (W.D.Pa.1973); United States v. First National Bank of Fort Smith, Ark., 173 F.Supp. 716 (W.D.Ark.1959). A few of the cases hold explicitly that expenses such as those incurred by respondent here should be considered part of the normal expense of doing business as a bank, and should therefore not be reimbursable.
This same reasoning seems equally applicable in the case of records held by a bank. See United States v. Northwest Pennsylvania Bank and Trust Co., 355 F.Supp. 607 (W.D.Pa.1973). Concerning plaintiffs' second contention involving the discriminatory application of the federal income tax laws in an attempt to intimidate the plaintiffs from continuing their activities in protesting the federal tax laws, the recent decision of the 9th Circuit in United States v. Scott, 521 F.2d 1188 (1975), appears to be dispositive of that issue.
The regulation under review here merely requires the banking institution to report each month the identity of any person or organization involved in a currency transaction of $10,000 or more in any denominations. The bank customer has no proprietary interest of any kind in the TCR-1 Form containing this information; the report is submitted by the bank, a third party with whom the customer has no established legal privilege, and concerns only matters relating to the bank's own transactions with the depositor. Cf. Donaldson v. United States, 400 U.S. 517, 530-531, 91 S.Ct. 534, 27 L.Ed.2d 580 (1971); United States v. Northwest Pennsylvania Bank and Trust Co., 355 F. Supp. 607, 612 (W.D.Pa. 1973). Unlike the situation in Stark, there is no disclosure or potential disclosure of the customer's personal and private transactions (i.e., checks, drafts and other instruments), no requirement that the bank maintain records usually not kept in the ordinary course of business (i.e., microfilms of customers' checks and banking instruments), and no requirement that any person or organization, other than the bank, participate in the reporting process.
Since Petitioner's Constitutional arguments have been found to be without any legal merit, his requests to declare 28 U.S.C. § 2201 and 26 U.S.C. § 7402(a) and (b), and § 7602, unconstitutional, to restrain the execution of 26 U.S.C. § 7402(a) and (b), 26 U.S.C. § 7602, and 28 U.S.C. § 2201, and to convene a Three Judge Court must also be denied. Finally, in support of the position adopted by this Court in denying the taxpayer's right to intervene in the present case, this Court has carefully analyzed the recent case of United States v. Northwest Pennsylvania Bank Tr. Co., 355 F. Supp. 607 (W.D.Pa. 1973), a case decided by Judge William Knox of this Court, and we find that the facts are sufficiently different to permit differing results. In the Northwest Bank Trust case the Court had before it a letter from the Chief of Intelligence Division, Internal Revenue Service, indicating to the taxpayer that the Service was considering recommending institution of criminal proceedings.
This question does trouble the Court, but is completely moot in the present case because the respondent bank did, in fact, notify the taxpayer of the issuance of the summons and a full hearing was afforded to the taxpayer on his right to intervene. Finally, in support of the position adopted by this Court in denying the taxpayer's right to intervene in the present case, this Court has carefully analyzed the recent case of United States v. Northwest Pennsylvania Bank Tr. Co., 355 F. Supp. 607 (W.D.Pa. 1973), a case decided by Judge William Knox of this Court, and we find that the facts are sufficiently different to permit differing results. In the Northwest Bank Trust case the Court had before it a letter from the Chief of Intelligence Division, Internal Revenue Service, indicating to the taxpayer that the service was considering recommending institution of criminal proceedings.
This interest is clearly insufficient to permit the taxpayer to attack the constitutionality of the provision in the manner urged by him. See Couch v. United States (1973), 409 U.S. 322; Donaldson v. United States (1971), 400 U.S. 517; United States v. Bank of Commerce (3rd Cir. 1969), 405 F.2d 931; Application of Cole (2nd Cir. 1965), 342 F.2d 5, cert. denied (1965), 381 U.S. 950; United States v. Northwest Pennsylvania Bank Trust Co. (W.D. Pa. 1973), 355 F. Supp. 607; Perkal v. Rayunec (N.D. Ill. 1964), 237 F. Supp. 102. • 2 There are several reasons for our refusal to entertain the taxpayer's claim of constitutional deprivation in respect to his failure to receive formal notice of the existence of a tax investigation.