Ishler v. C.I.R., Civil Action No. CV-05-S-1108-NE.

• Court: United States District Courts. 11th Circuit. United States District Court of Northern District of Alabama
• Writing for the Court: Smith
• Citation: 442 F.Supp.2d 1189
• Decision Date: 05 July 2006
• Docket Number: Civil Action No. CV-05-S-1108-NE.
• Parties: Domer L. ISHLER, Plaintiff, v. COMMISSIONER OF INTERNAL REVENUE, United States of America, et al., Defendants.

442 F.Supp.2d 1189 Domer L. ISHLER, Plaintiff,
v.
COMMISSIONER OF INTERNAL REVENUE, United States of America, et al., Defendants. Civil Action No. CV-05-S-1108-NE. United States District Court, N.D. Alabama, Northeastern Division. July 5, 2006.

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Cheryl Baswell-Guthrie, Baswell-Guthrie PC, Huntsville, AL, for Plaintiff.

Lynne M. Murphy, U.S. Department of Justice, Tax Division, Washington, DC, Daniel Kaufmann, Gary C. Huckaby, Bradley Arant Rose & White, Huntsville, AL, for Defendants.

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MEMORANDUM OPINION

SMITH, District Judge.

Plaintiff, Domer L. Ishler, asserts claims against three defendants: (1) the Commissioner of Internal Revenue for the United States of America ("the Commissioner"); (2) John L. Richardson, an agent for the Internal Revenue Service ("IRS");¹ and (3) Nissei Sangyo America, Ltd. ("NSA").² Plaintiff bases federal subject matter jurisdiction on 28 U.S.C. §§ 1331,³ 1346,⁴ 1361,⁵ 2201⁶ and 2202,⁷ as he alleges statutory violations, asserts claims against officials of the United States government, and requests declaratory relief. All of plaintiff's claims arise out of a dispute over his liability for federal income taxes on certain revenue generated in a business deal involving defendant NSA.

Plaintiff's pro se complaint⁸ states three explicit causes of action: (1) a claim for a

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declaratory judgment that plaintiff is entitled to a federal income tax credit for funds withheld by NSA from the proceeds of a business deal involving plaintiff and NSA; (2) a claim for "damages for breach of trust or fiduciary duty" against Richardson and the IRS; and (3) an "informal claim for refund or credit" from the IRS for taxes allegedly withheld by NSA.⁹ In addition, the complaint—certainly no model of clarity—contains allegations that could be construed as alleging the following, not specifically-enumerated claims: (1) fraud against all defendants;¹⁰ (2) breach of contract against NSA;¹¹ (3) civil conspiracy against all defendants;¹² and (4) a claim for treble damages against NSA under a state statute that plaintiff describes as the "Alabama Salesman Protection Act."¹³ Plaintiff requests entry of an order requiring the Commissioner to issue him a tax credit, entry of an order allowing discovery, and damages in the total amount of $185,000,000.¹⁴ Richardson and the Commissioner jointly filed a motion to dismiss plaintiff's claims against them pursuant to subsections (b)(1), (b)(2), (b)(5), and (b)(6) of Federal Rule of Civil Procedure 12.¹⁵ NSA also moved to dismiss plaintiff's claims against it pursuant to Rules 12(b)(1) and 12(b)(6).¹⁶ These motions presently are before the court.

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I. STANDARDS OF REVIEW

A. Rule 12(b)(6): Failure to State a Claim Upon Which Relief Can Be Granted

The Federal Rules of Civil Procedure require only that a complaint contain a "`short and plain statement of the claim' that will give the defendant fair notice of what the plaintiffs claim is and the grounds upon which it rests." Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957) (quoting Fed.R.Civ.P. 8(a)(2)). Consequently, a complaint should not be dismissed for failing to state a claim upon which relief can be granted "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley, 355 U.S. at 45-46, 78 S.Ct. 99. Even so, pleadings must be "something more than an ingenious academic exercise in the conceivable." Marsh v. Butler County, 268 F.3d 1014, 1037 (11th Cir.2001) (en banc.) Although notice pleading may not require that the pleader allege a "specific fact" to cover every element, or allege "with precision" each element:of a claim, the Eleventh Circuit has explained that the complaint must "contain either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory." Roe v. Aware Woman Center for Choice, Inc., 253 F.3d 678, 683 (11th Cir.2001).

When ruling on a Rule 12(b)(6) motion, the court must accept all well-pleaded facts as true, and construe them in the light most favorable to the non-moving party. Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984); see also, e.g., Brooks v. Blue Cross and Blue Shield of Florida, 116 F.3d 1364, 1369 (11th Cir.1997); Quality Foods de Centro America, S.A. v. Latin American Agribusiness Dev. Corp., S.A., 711 F.2d 989, 994-95 (11th Cir.1983). Further, "[a] complaint may not be dismissed because the plaintiffs claims do not support the legal theory he relies upon since the court must determine if the allegations provide for relief on any possible theory." Brooks, 116 F.3d at 1369 (emphasis in original) (citation omitted).

Additionally, the Eleventh Circuit has observed that "[a] statute of limitations defense may be raised on a motion to dismiss for failure to state a claim for which relief can be granted under Fed. R.Civ.P. 12(b)(6), when the complaint shows on its face that the limitations period has run." Avco Corp. v. Precision Air Parts, Inc., 676 F.2d 494, 495 (11th Cir. 1982).

B. Rule 12(b)(1): Lack of Subject Matter Jurisdiction

Federal district courts are tribunals of limited jurisdiction, "`empowered to hear only those cases within the judicial power of the United States as defined by Article III of the Constitution,' and which have been entrusted to them by a jurisdictional grant authorized by Congress." University of South Alabama v. The American Tobacco Co., 168 F.3d 405, 409 (11th Cir. 1999) (quoting Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir.1994)). Accordingly, an "Article III court must be sure of its own jurisdiction before getting to the merits" of any action. Ortiz v. Fibreboard Corp., 527 U.S. 815, 831, 119 S.Ct. 2295, 144 L.Ed.2d 715 (1999) (citing Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 88-89, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998)); see also, e.g., Galindo-Del Valle v. Attorney General, 213 F.3d 594, 598 n. 2 (11th Cir.2000) (observing that federal courts are "obligated to inquire into subject matter jurisdiction sua sponte whenever it may be lacking."), cert. denied, 533 U.S. 949, 121 S.Ct. 2590, 150 L.Ed.2d 749 (2001); University of South Alabama,

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168 F.3d at 410 ("[A] court should inquire into whether it has subject matter jurisdiction at the earliest possible stage in the proceedings.").

C. Rule 12(b)(2): Lack of Personal Jurisdiction

When ruling upon a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction in the absence of an evidentiary hearing,

the plaintiff must establish a prima facie case of personal jurisdiction over a nonresident defendant. A prima facie case is established if the plaintiff presents enough evidence to withstand a motion for directed verdict. The district court must accept the facts alleged in the complaint as true, to the extent they are uncontroverted by the defendant's affidavits. Finally, where the plaintiff's complaint and the defendant's affidavits conflict, the district court must construe all reasonable inferences in favor of the plaintiff.

Robinson v. Giarmarco & Bill, P.C., 74 F.3d 253, 255 (11th Cir.1996) (quoting Madara v. Hall, 916 F.2d 1510, 1514 (11th Cir.1990)) (citations omitted); see also, e.g., Morris v. SSE, Inc., 843 F.2d 489, 492 (11th Cir.1988).

D. Rule (12)(b)(5): Insufficiency of Service of Process

Plaintiff bears the burden of establishing that service was properly effected pursuant to Federal Rule of Civil Procedure 4. See Prewitt Enterprises, Inc. v. Organization of the Petroleum Exporting Countries, 224 F.R.D. 497, 501 (N.D.Ala. 2002) (Clemon, J.), aff'd, 353 F.3d 916 (11th Cir.2003).

E. Pro Se Litigants

Parties who appear pro se are afforded a leniency not granted to those who are represented by counsel. See, e.g., Hughes v. Rowe, 449 U.S. 5, 9, 101 S.Ct. 173, 66 L.Ed.2d 163 (1980) ("It is settled law that the allegations of [a pro se complaint filed by a state prisoner], `however inartfully pleaded,' are held to `less stringent standards than formal pleadings drafted by lawyers.'") (quoting Haines v. Kerner, 404 U.S. 519, 92 S.Ct. 594, 30 L.Ed.2d 652 (1972)); Harmon v. Berry, 728 F.2d 1407, 1409 (11th Cir.1984) (same); Woodall v. Foti, 648 F.2d 268, 271 (5th Cir.1981)¹⁷ ("A pro se complaint, however inartfully drafted, must be held to less rigorous standards than the formal pleadings prepared by lawyers and can only be dismissed for failure to state a claim if it appears `beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.'") (quoting Haines.)

Even so, the leniency accorded pro se litigants is not unqualified. As the Sixth Circuit has written:

While courts must apply "less stringent standards" in determining whether pro se pleadings state a claim for which relief can be granted, Estelle v. Gamble, 429 U.S. 97, 106, 97 S.Ct. 285, 292, 50 L.Ed.2d 251 (1976), pro se plaintiffs are not automatically entitled to take every case to trial. As this court has noted, the lenient treatment generally accorded to pro se litigants has limits. Jourdan v. Jabe, 951 F.2d 108, 110 (6th Cir.1991). Where, for example, a pro se litigant fails to comply with an easily understood court-imposed deadline, there is no basis for treating that party more generously than a represented litigant. Id.

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Pilgrim v. Littlefield, 92 F.3d 413, 416 (6th Cir.1996).

II. THE ALLEGATIONS OF PLAINTIFF'S COMPLAINT

During the time period relevant to his complaint, plaintiff served as Chief Executive Officer of Twentieth Century Marketing ("TCM"), a company engaged in the business of locating manufacturers of electronic products in Asian nations and finding markets for the sale of those products within the United States. In 1985, Ishler (on behalf of TCM) began to negotiate with NSA to...