Opinion
No. C 04-01428 WHA.
September 27, 2004
ORDER DENYING PLAINTIFF'S MOTION TO VACATE JUDGMENT
INTRODUCTION
Plaintiff's original complaint requested that the Court require the IRS to accept his $50,000 offer in compromise to settle a tax liability of approximately three million dollars, and to release a tax lien against him. Finding that it lacked jurisdiction to grant such relief, this Court granted defendant's motion to dismiss on August 4, 2004. Plaintiff timely filed the instant motion to vacate the Court's judgment under Rule 59(e). Because plaintiff's motion is a thinly-disguised attempt to relitigate old matters, this order DENIES the request to vacate the judgment.
STATEMENT
Plaintiff Michael Zarcone is president and sole owner of three corporations which provide long-term care facilities for disabled children. Plaintiff's complaint alleged that the IRS acted arbitrarily and unreasonably when it filed a tax lien notice without considering the offer in compromise filed by plaintiff. Plaintiff's prayer for relief requested the Court to require the IRS to accept his offer in compromise and to release its tax lien. This Court's August 4 order granted defendant's motion to dismiss. The order found that the Court lacked jurisdiction over the matter because the Anti-Injunction Act precluded the Court from granting the requested relief. Plaintiff timely filed the instant motion on August 18, 2004.
ANALYSIS
Rule 59(e) authorizes a motion to alter or amend a judgment after its entry. The rule also has been interpreted as permitting a motion to vacate a judgment rather than merely amend it. Foman v. Davis, 371 U.S. 178, 181 (1962). Rule 59(e), however, is an "extraordinary remedy, to be used sparingly in the interests of finality and conservation of judicial resources." Kona Enterprises, Inc. v. Estate of Bishop, 229 F.3d 877, 890 (9th Cir. 2000). Amendment or alteration is appropriate under Rule 59(e) if (1) the district court is presented with newly-discovered evidence, (2) the district court committed clear error or made an initial decision that was manifestly unjust, or (3) there is an intervening change in controlling law. Zimmerman v. City of Oakland, 255 F.3d 734, 740 (9th Cir. 2001). This showing is a "high hurdle." Weeks v. Bayer, 246 F.3d 1231, 1236 (9th Cir. 2001). A judgment is not properly reopened "absent highly unusual circumstances." Id. This case presents no such unusual circumstances.
Plaintiff's motion is essentially an attempt to relitigate the defendant's original motion to dismiss. Plaintiff presents no new evidence. He points to no intervening change in the law. He makes no showing that the August 4 order was manifestly unjust. Instead, plaintiff makes a series of arguments that were already raised, or could have been raised, prior to the entry of judgment. Plaintiff's motion is accordingly denied.
* * *
Plaintiff's first argument is that the judgment should be vacated because "new evidence" has been discovered after this Court's dismissal of his case (Br. 2). The newly-discovered evidence, however, consists of a single Tax Court decision, Fowler v. CIR, T.C. Memo 2004-163. Even if a court decision were to constitute "evidence," the evidence in question is certainly not "newly-discovered." The Fowler decision was rendered July 13, 2004, two weeks before plaintiff submitted its opposition to defendant's motion to dismiss on July 28, 2004. The introduction of such evidence is not grounds for granting a motion to vacate. See Zimmerman, 255 F.3d at 740 ("a party that fails to introduce facts in a motion or opposition cannot introduce them later in a motion to amend by claiming that they constitute `newly discovered evidence' unless they were previously unavailable"). Moreover, the Fowler decision is inapposite. The court in Fowler was asked to decide whether an IRS appeals officer's refusal to accept an offer in compromise was arbitrary and capricious. Thus, Fowler does not address the threshold issue in plaintiff's case — i.e., whether the Anti-Injunction Act precludes a court from granting plaintiff the relief he requested in his complaint.
In addition, plaintiff makes an argument regarding "manifest injustice." Plaintiff does not, however, allege that the Court's initial decision was manifestly unjust. Rather, plaintiff states that "[i]f this court does not vacate its order and allow the Plaintiff to amend its complaint, he may not file a new complaint because the 30 day statute of limitations for appealing a Collection Due Process hearing in District Court has expired" (Br. 2). The situation to which plaintiff objects is of his own making. There would be no statute of limitations issue had plaintiff amended the complaint prior to the entry of judgment. Rule 59(e) does not require a court to rescue parties from the consequences of their own choices.
Plaintiff also argues that the Court committed clear error. He argues that the Court's finding that it was without jurisdiction to grant the relief plaintiff requested was "premature and unwarranted." Plaintiff contends that he was seeking more than the specifically-requested injunction requiring that the IRS release the tax lien and accept the offer in compromise. In support, plaintiff refers to a catch-all phrase in his complaint that requests "such other and further relief as this court deems appropriate." In plaintiff's estimation, this phrase encompassed a request that the Court review the appeal officer's conduct for abuse of discretion. Because the Court has jurisdiction to conduct such a review, the argument goes, dismissal was improper.
Though plaintiff could have argued that the catch-all phrase encompassed additional relief in his opposition to the motion to dismiss, the argument is just now being raised for the first time. A district court need not consider legal arguments made for the first time on a motion to amend the judgment. See Zimmerman, 255 F.3d at 740. Moreover, plaintiff had ample opportunity in the initial action to amend its complaint to specify a different form of relief. Thus, the dismissal for lack of jurisdiction was not clear error.
Plaintiff's motion also includes assertions that jurisdiction over his claim is conferred upon this court by statute and that the appeals officer abused his discretion (Br. 2, 5-6). These arguments do not regard manifest error, an intervening change in law, or new evidence. The arguments were, however, raised in plaintiff's opposition and ultimately did not preclude dismissal. Because plaintiff is merely attempting to relitigate old matters, the original judgment need not be vacated.
In one last attempt at "a second bite at the apple," plaintiff now requests leave to file an amended complaint. Judgment must first be reopened under FRCP 59, however, before a court can entertain a motion to amend. Weeks, 246 F.3d at 1236. As demonstrated above, plaintiff has not met the requirements for reopening judgment. Notwithstanding that fact, plaintiff insists that "the law favors allowing the plaintiff to amend his complaint" (Br. 4). Plaintiff cites to no authority from within the circuit to support this contention. Moreover, the policy interests that require courts to liberally grant leave to amend are inapposite after judgment is rendered. Weeks, 246 F.3d at 1236.
CONCLUSION
For the foregoing reasons, plaintiff's motion to vacate judgment and request for leave to amend are DENIED.
IT IS SO ORDERED.