Meuli v. United States
| Decision Date | 07 July 2011 |
| Docket Number | Case No. 11-1044-RDR |
| Parties | GENE E. MEULI, Plaintiff, v. UNITED STATES OF AMERICA, Defendant. |
| Court | U.S. District Court — District of Kansas |
Plaintiff, pro se, filed this action listing the Commissioner of the Internal Revenue Service as defendant. Since he filed this case, plaintiff has been permitted to amend the complaint to list the United States as the proper defendant. This case is before the court upon the motion to dismiss of the United States. The government has filed its motion to dismiss pursuant to FED.R.CIV.P. 12(b)(1),(5) and (6).
In his amended complaint, plaintiff alleges that:
Doc. No. 20, pp. 3-4. These are essentially the same allegations as in the original complaint. In response to the United States' motion to dismiss, plaintiff clarifies that he is contesting a March 10, 2010 letter in which the IRS assessed a $5,000.00 penalty against plaintiff for allegedly filing a frivolous 2002 tax return. Doc. No. 9 at p. 3.
In the original complaint, plaintiff asked that the court "order the IRS to release the . . . levy on my Social Security [b]enefits and return all property taken by the IRS . . ." In his amended complaint, plaintiff asks for relief as stated under 26 U.S.C. § 7433. Doc. No. 20 at p. 4.
A pro se litigant's pleadings "are to be construed liberally and held to a less stringent standard than formal pleadings drafted by lawyers." Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991). If plaintiff's pleadings can be reasonably read to state a valid claim on which they could prevail, the court should do so despite a failure to cite proper legal authority or follow normal pleading requirements. Id. But, the court may not provide additional factual allegations "to round out a plaintiff's complaint or construct a legal theory on a plaintiff's behalf." Whitney v. New Mexico, 113 F.3d 1170, 1173-74 (10th Cir. 1997).
In this order the court shall address the government'sarguments for dismissal pursuant to FED.R.CIV.P. 12(b)(1) and FED.R.CIV.P. 12(b)(6).1
Regarding motions alleging a lack of jurisdiction under Rule 12(b)(1), it is well-settled that plaintiff bears the burden of showing that jurisdiction is proper and must demonstrate that the case should not be dismissed. U.S. ex rel. Stone v. Rockwell Int'l Corp., 282 F.3d 787, 797 (10th Cir. 2002). Plaintiff must sustain the burden of alleging facts which show jurisdiction and supporting those facts with competent proof. Id. at 797-98. "'Mere conclusory allegations of jurisdiction are not enough.'" Id. at 798 (quoting United States ex rel. Hafter v. Spectrum Emergency Care, Inc., 190 F.3d 1156, 1160 (10th Cir. 1999)). To survive a motion to dismiss for failure to state a claim under Rule 12(b)(6), a complaint must present factual allegations, assumed to be true, that "raise a right to relief above the speculative level" and must contain "enough facts to state a claim to relief that is plausible on its face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 & 570 (2007). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). "[A]llegations of conclusions or opinions are not sufficient when no facts arealleged by way of the statement of the claim." Bryan v. Stillwater Board of Realtors, 578 F.2d 1319, 1321 (10th Cir. 1977).
The court has the authority to raise issues regarding the failure to state a claim, whether or not those issues are asserted in the motions to dismiss. See Whitney, 113 F.3d at 1173.
The United States contends in this case that it has not consented to be sued under the statutes alleged by plaintiff and that plaintiff cannot find or prove an explicit waiver of sovereign immunity. This case must be dismissed for lack of jurisdiction if the government prevails in this argument.
"Absent a waiver, sovereign immunity shields the Federal Government and its agencies from suit." FDIC v. Meyer, 510 U.S. 471, 475 (1994). Id., (quoting U.S. v. Sherwood, 312 U.S. 584, 586 (1941). As the Tenth Circuit explained in Fostvedt v. United States, 978 F.2d 1201 (10th Cir. 1992) cert. denied, 507 U.S. 988 (1993), plaintiff must establish an explicit waiver of sovereign immunity in order to sue the United States:
Id. at 1202-03 (internal quotations and citations omitted).
In his amended complaint, plaintiff has cited the following statutes to support plaintiff's claim of jurisdiction in this case: 28 U.S.C. §§ 1331 and 1343; and 26 U.S.C. §§ 408(d)(3), 3401, 6201, 6203, 6331(a), 6702, 6751(b)(1), 7433, 7491 and 7701(a). He also makes reference to the Constitution. For its part, the United States discusses but asks the court to reject 26 U.S.C. § 7422 as an applicable waiver of sovereign immunity in this case.
Upon the current record on file, the court finds that there is no explicit waiver of sovereign immunity which applies to plaintiff's action.
1. Section 7433
Section 7433 of the Internal Revenue Code has been considered an explicit waiver of sovereign immunity. However, the waiver is conditioned upon the exhaustion of administrative procedures. Section 7433 states in part:
This section of the IRS Code does not give this court jurisdiction to consider plaintiff's challenge against the assessed penalty for two reasons. First, plaintiff does not allege that he filed an administrative claim for damages as required to state a claim under § 7433(d)(1). Exhaustion of administrative remedies is required to bring a claim for damages under the statute. Rae v. U.S., 530 F.Supp.2d 127, 130-31 (D.D.C. 2008); Brooks v. Snow, 313 F.Supp.2d 654, 661-62 (S.D.Tex. 2004). Second, § 7433 is "not a remedy for taxpayers alleging impropriety or errors in the tax assessment process." Addington v. U.S., 75 F.Supp.2d 520, 523 (S.D.W.Va. 1999). "Taxpayers who wish to challenge the IRS' calculation of their tax liability must file either a petition for redetermination in the Tax Court . . . or a refund action in the district court." Gonsalves v. I.R.S., 975 F.2d 13, 16 (lst Cir. 1992) (statutory citations omitted). Plaintiff appears to be challenging the validity of the penalty assessed against him by the IRS, not the manner of collecting the penalty. His arguments assert that he had no tax liability and the penalty was unjustifiable. Section 7433 does not provide jurisdiction in this court for such claims. Dockery v. U.S. Dept. of Treasury, 593 F.Supp.2d 258, 260-61(D.D.C. 2009).
2. Section 7422
As noted earlier, the government acknowledges that 26 U.S.C. § 7422(a) is an explicit waiver of sovereign immunity. Section 7422(a) provides:
No suit or proceeding shall be maintained in any court for the recovery of any . . . penalty claimed to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until the claim for refund or credit has been duly filed with the Secretary, according to the provisions of law in that regard, and the regulations of the Secretary established in pursuance thereof.
According to the government, the court cannot exercise jurisdiction pursuant to this statute because, although plaintiff is making a claim for a refund, he has not filed an administrative claim for a refund with the IRS prior to filing his complaint in this court.
The government further cites Mires v. U.S., 466 F.3d 1208, 1211 (10th Cir. 2006) where the court concluded:
Two prerequisites must be met before a district court has subject matter jurisdiction under § 1346(a)(1). First, a plaintiff must have fully paid the challenged tax assessment. . . . Second, a plaintiff must have filed a valid refund claim with the IRS, and the IRS must have denied the claim or six months must have passed since the claim was filed with no IRS response. 26 U.S.C. §§ 6532(a)(1), 7422(a).
The prior administrative claim requirement has been applied to dismiss actions against the...
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