Hubbard v. U.S.

• Decision Date: 03 August 2007
• Docket Number: Civil Action No. 07-0023 (RMU).
• Citation: 496 F.Supp.2d 194
• Parties: Murphy M. HUBBARD, Plaintiff, v. UNITED STATES of America et al., Defendants.
• Court: U.S. District Court — District of Columbia

496 F.Supp.2d 194

Murphy M. HUBBARD, Plaintiff, v. UNITED STATES of America et al., Defendants.

Civil Action No. 07-0023 (RMU).

United States District Court, District of Columbia.

August 3, 2007.

COPYRIGHT MATERIAL OMITTED

Murphy M. Hubbard, Springfield, MO, pro se.

Dashiell Shapiro, U.S. Department of Justice, Washington, DC, for Defendants.

MEMORANDUM OPINION

DENYING THE PLAINTIFF'S MOTION FOR INJUNCTIVE RELIEF

URBINA, District Judge.

I. INTRODUCTION

The pro se plaintiff brings suit, alleging that the Department of the Treasury wrongfully disbarred him from representing clients before the Internal Revenue Service ("IRS"). He asks the court to enjoin the defendants from enforcing his disbarment until the court can review the agency's action on the merits. The plaintiff also seeks to prevent the defendants from advertising in public notices that he is disbarred. The defendants oppose the motion, arguing that the Department of the Treasury is statutorily authorized to suspend or disbar an individual from representing clients before the IRS after it provides the individual with notice and an opportunity to be heard. Moreover, the defendants argue that the plaintiff received notice and a "full-blown" hearing that satisfied its statutory obligations to the plaintiff. Because it concludes that the plaintiff has not demonstrated a substantial likelihood of success on the merits, the court denies the plaintiffs motion for injunctive relief.

II. BACKGROUND

A. Factual History

The parties' briefing of the instant motion fails to provide the court the courtesy of a description of the relevant facts or dates. The court, therefore, relies on the parties' arguments, as best it can, and draws from the administrative record in constructing the facts pertinent to the present dispute.

The plaintiff is a certified public accountant who was previously qualified to represent clients appearing before the IRS. Administrative R. ("AR") at 8; Pl.'s Mot. for Emergency Temporary and Prelim. Relief ("Pl.'s Mot.") at 1. On April 16, 2002, the plaintiff received a letter from the IRS Office of Director of Practice advising him that the IRS had "information raising questions concerning possible violations ... of the regulations governing practice before the Internal Revenue Service." AR at 1089. The defendants allowed the plaintiff 30 days to respond to the information and held further action on the matter in abeyance for that time. Id.

On April 13, 2003, the defendants initiated an administrative complaint against the plaintiff claiming that he failed to file federal income tax returns, both personal tax returns and corporate tax returns for the Hubbard Group, P.C., for 1997, 1998, 1999 and 2000. AR at 265-66; Compl. at 2-3; Defs.' Opp'n to Pl.'s Mot. ("Defs.' Opp'n") at 2-3. The IRS also charged the plaintiff with failing to deposit and pay employment taxes for the Hubbard Group, P.C. for several quarters. AR at 266. At some point later, the IRS Office of Professional Responsibility demanded that the plaintiff "voluntarily submit to a 40-month suspension." Compl. at 4. The plaintiff, presumably, refused the voluntary suspension. See Pl.'s Mot. at 3. As a result, the defendants sought the plaintiffs disbarment.

Although the briefing of the administrative proceedings in this case is inadequate, the Administrative Record reveals that, on April 24, 2003, the proceedings were assigned to an Administrative Law Judge ("ALJ). AR at 34. The plaintiff subsequently received a hearing before an ALJ, and that ALJ ruled in favor of disbarment on January 14, 2004. Id. at 265-77. "More than a year" later, the IRS published in the Internal Revenue Bulletin a notice that the plaintiff had been disbarred. Pl.'s Mot. at 5. The plaintiff appealed the ALJ's decision, and on August 30, 2004, the appellate ALJ issued a decision affirming the ALJ's decision in part and remanding it in part for additional findings. AR at 32-91. On remand, the ALJ held a hearing and, on July 1, 2005, issued his decision on remand. Id. at 230-64. The plaintiff again appealed, and on September 20, 2006, an appellate ALJ issued a final decision affirming the plaintiffs disbarment. Id. at 24-30.

B. Procedural History

On January 4, 2007, the plaintiff filed suit to challenge his disbarment. He simultaneously moved for injunctive relief, asking the court to prevent the IRS from either disbarring the plaintiff or issuing public notice of his disbarment pending this court's review of his underlying challenge to the disbarment. On March 30, 2007, nearly two months after receiving notice of the plaintiffs motion, the defendants opposed the plaintiffs motion for injunctive relief.¹ On May 18, 2007, nearly two months later, the plaintiff filed a reply.

III. ANALYSIS

A. Legal Standard for Injunctive Relief

This court may issue interim injunctive relief only when the movant demonstrates:

(1) a substantial likelihood of success on the merits, (2) that it would suffer irreparable injury if the injunction is not granted, (3) that an injunction would not substantially injure other interested parties, and (4) that the public interest would be furthered by the injunction.

Mova Pharm. Corp. v. Shalala, 140 F.3d 1060, 1066 (D.C.Cir.1998) (quoting CityFed Fin. Corp. v. Office of Thrift Supervision, 58 F.3d 738, 746 (D.C.Cir.1995)); see also World Duty Free Americas, Inc. v. Summers, 94 F.Supp.2d 61, 64 (D.D.C.2000). It is particularly important for the movant to demonstrate a substantial likelihood of success on the merits. Cf. Benten v. Kessler, 505 U.S. 1084, 1085, 112 S.Ct. 2929, 120 L.Ed.2d 926 (1992) (per curiam). Indeed, absent a "substantial indication" of likely success on the merits, "there would be no justification for the court's intrusion into the ordinary processes of administration and judicial review." Am. Bankers Ass'n v. Nat'l Credit Union Admin., 38 F.Supp.2d 114, 140 (D.D.C.1999) (internal quotation omitted).

The four factors should be balanced on a sliding scale, and a party can compensate for a lesser showing on one factor by making a very strong showing on another factor. CSX Transp., Inc. v. Williams, 406 F.3d 667 (D.C.Cir.2005) (citing CityFed Fin. Corp., 58 F.3d at 747). "An injunction may be justified, for example, where there is a particularly strong likelihood of success on the merits even if there is a relatively slight showing of irreparable injury." CityFed Fin. Corp., 58 F.3d at 747.

Moreover, the other salient factor in the injunctive relief analysis is irreparable injury. A movant must "demonstrate at least `some injury" to warrant the granting of an injunction. CityFed Fin. Corp., 58 F.3d at 747 (quotation omitted). Indeed, if a party makes no showing of irreparable injury, the court may deny the motion for injunctive relief without considering the other factors. Id.

Because interim injunctive relief is an extraordinary form of judicial relief, courts should grant such relief sparingly. Mazurek v. Armstrong, 520 U.S. 968, 972, 117 S.Ct. 1865, 138 L.Ed.2d 162 (1997). As the Supreme Court has said, "[i]t frequently is observed that a preliminary injunction is an extraordinary and drastic remedy, one that should not be granted unless the movant, by a clear showing, carries the burden of persuasion." Id. (citation omitted). Therefore, although the trial court has the discretion to issue or deny a preliminary injunction, it is not a form of relief granted lightly. In addition, any injunction that the court issues must be carefully circumscribed and tailored to remedy the harm shown. Nat'l Treasury Employees Union v. Yeutter, 918 F.2d 968, 977 (D.C.Cir.1990) (citation omitted).

B. The Court Denies the Plaintiff's Motion for Injunctive Relief

1. The Plaintiff has Not Demonstrated a Substantial Likelihood of Success on the Merits

The plaintiffs argument for injunctive relief centers on his claims of irreparable injury.² Because the plaintiff is acting pro se, the court independently analyzes his likelihood of success on the merits. Under the Administrative Procedures Act, 5 U.S.C. § 702 ("APA"), the plaintiff may succeed on his claims by showing that the defendants' action in disbarring him was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706; Tourus Records, Inc. v. Drug Enforcement Admin., 259 F.3d 731, 736 (D.C.Cir.2001). In making this inquiry, the court "must consider whether the [agency's] decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment." Marsh v. Or. Natural Res. Council, 490 U.S. 360, 378, 109 S.Ct. 1851, 104 L.Ed.2d 377 (1989) (internal quotations omitted). At a minimum, the defendants must have considered relevant information and articulated an explanation establishing a "rational connection between the facts found and the choice made." Bowen v. Am. Hosp. Ass'n, 476 U.S. 610, 626, 103 S.Ct. 2101, 90 L.Ed.2d 584 (1986); Tourus Records, 259 F.3d at 736. To determine the plaintiffs likelihood of success on the merits, the court looks to the administrative record. Am. Bioscience v. Thompson, 243 F.3d 579, 582 (D.C.Cir.2001) (stating that before assessing the plaintiffs probability of success on the merits in an APA case, the district court should have required the defendant to file an administrative record because the APA requires the court to review "the whole record or those parts of it cited by a party") (citing 5 U.S.C. § 706).

a. The Plaintiff has Not Demonstrated that His Disbarment was Arbitrary, Capricious or An Abuse of Discretion

A court will set aside an administrative decision to disbar an individual only if the action was arbitrary, capricious, an abuse of discretion, or otherwise contrary to law. Lopez v. U.S., 129 F.Supp.2d 1284, 1288 (D.N.M.2000); see also 5 U.S.C. § 706; Tourus, 259 F.3d at 736. To succeed on his claims, the plaintiff must show that the record lacks substantial evidence in support of the...