Nelson v. Silverman

• Decision Date: 06 June 1995
• Docket Number: Civ. No. 88-0930 (AJB).
• Citation: 888 F. Supp. 1041
• Parties: Linda NELSON, Plaintiff, v. Steven SILVERMAN, Defendant.
• Court: U.S. District Court — Southern District of California

888 F. Supp. 1041

Linda NELSON, Plaintiff, v. Steven SILVERMAN, Defendant.

Civ. No. 88-0930 (AJB).

United States District Court, S.D. California.

June 6, 1995.

Mark R. Moore, La Mesa, CA, for plaintiff.

Robert H. Plaxico, U.S. Dept. of Justice, Office of U.S. Atty., San Diego, CA, Greg Addington, John P. Pirkle, U.S. Dept. of Justice, Tax Div., Washington, DC, for defendant.

Memorandum Decision Granting Defendant's Motion Under Fed.R.Civ.P. 50(a) for Judgment as a Matter of Law

BATTAGLIA, United States Magistrate Judge.

This case came on for jury trial on May 15, 1995.¹ Defendant, Steven Silverman, submitted a Motion for Judgment as a Matter of Law pursuant to Fed.R.Civ.P. 50(a) following the Plaintiff's case in chief on the issue of liability and on the issue of qualified immunity.² The Plaintiff in this case presented three theories of recovery under a Bivens³ Complaint: (1) Defendant violated her Fourth Amendment right of freedom from unreasonable seizure; (2) Defendant violated her Fifth Amendment right to procedural due process; and (3) Defendant violated her Fifth Amendment right to substantive due process by abusive tax collection procedures. This case also involves a claim and defense by the Defendant that he was entitled to qualified immunity.⁴

STANDARD FOR THE MOTION

Rule 50(a) of the Federal Rules of Civil Procedure provides, in part:

(1) If during a trial by jury a party has been fully heard on an issue and there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue, the court may determine the issue against that party and may grant a motion for judgment as matter of law against that party with respect to a claim or defense that cannot under the controlling law be maintained or defeated without a favorable finding on that issue.

If there is no substantial evidence to support the claim, the Court must direct a verdict. Chisholm Bros. Farm Equip. Co. v. Int'l Harvester Co., 498 F.2d 1137 (9th Cir. 1974); Cleary v. National Distillers and Chemical Corp., 505 F.2d 695 (9th Cir.1974).

The Rule 50(a) motion brings into focus whether the evidence presented at trial is sufficient to create an issue of fact for the jury or permits the Court to enter judgment as a matter of law and is solely a question of law to be determined by the Court. Bankers Trust Co. v. Lee Keeling & Assoc., Inc., 20 F.3d 1092 (10th Cir.1994). Since relief of this type does deprive the party opposing the motion of a determination of the facts by the jury, the case law indicates it is to be granted not only cautiously, but sparingly. Honce v. Vigil, 1 F.3d 1085 (10th Cir.1993).

The federal courts have, however, declined to follow the rule that a scintilla of evidence is enough to create this issue for the jury. A.B. Small Co. v. Lamborn & Co., 267 U.S. 248, 254, 45 S.Ct. 300, 69 L.Ed. 597 (1925). The question is not whether there is no evidence supporting the party against whom the motion is directed but whether the evidence is sufficient for the jury to properly find a verdict for the party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

Stated another way, the party with the burden of proof (here, Ms. Nelson, the Plaintiff), on the constitutional violations in the Bivens case has to come forward with evidentiary facts that establish the ultimate facts and the degree of proof must be such as to remove these ultimate facts from the field of mere speculation or conjecture; specifically, the jury cannot be allowed to theorize the ultimate facts based on a mere possibility. See Peterson v. Kennedy, 771 F.2d 1244, 1256 (9th Cir.1985), cert. denied, 475 U.S. 1122, 106 S.Ct. 1642, 90 L.Ed.2d 187 (1986).

Importantly, in making determinations on the Rule 50(a) motion, the Court is not free to weigh the parties' evidence at trial, nor to pass on the credibility of the witnesses. Lytle v. Household Mfg., Inc., 494 U.S. 545, 110 S.Ct. 1331, 108 L.Ed.2d 504 (1990); Hiltgen v. Sumrall, 47 F.3d 695 (5th Cir.1995). Finally, the Court may not substitute its judgment of the facts for the judgment of the jury. Tennant v. Peoria & Pekin Union Ry. Co., 321 U.S. 29, 64 S.Ct. 409, 88 L.Ed. 520 (1944). Instead, the evidence has to be viewed most favorably to the party against whom the motion is made and that party is to be given the benefit of all reasonable inferences that may be drawn from the evidence. Galloway v. U.S., 319 U.S. 372, 63 S.Ct. 1077, 87 L.Ed. 1458 (1943); Favorito v. Pannell, 27 F.3d 716 (1st Cir.1994).

The motion really requires that the evidence offered by the Plaintiff be considered against the backdrop of the applicable law. As to liability, that would be the clearly established rights under the Fourth and Fifth Amendments of the United States Constitution. Concerning the qualified immunity claim and based on Act Up!/Portland v. Bagley, 988 F.2d 868 (9th Cir.1993), this Court is required to determine whether the facts alleged could support an objective belief that Defendant's conduct was reasonable as a matter of law.

PLAINTIFF'S CLAIMS AND EVIDENCE

The Plaintiff's claims essentially arise under the Fourth and Fifth Amendments. The Fourth Amendment is implicated by Plaintiff's claims of unreasonable seizure of both her money, by virtue of the wage levy at Safeway, and her real property, by virtue of the levy and the notice of levy posted at the Plaintiff's home. The Fifth Amendment claims are two fold. First, Plaintiff claims she was denied procedural due process by lack of notice and opportunity to be heard. Second, the Plaintiff claims a violation of substantive due process based upon the Bothke⁵ case concerning the concept of a constitutional right to be free from abusive tax collection practices.

The Plaintiff's evidence at trial concentrated on a number of significant areas. The Court finds that the following facts were shown by the Plaintiff at trial, and are the underpinnings of the Court's decision on this motion under Rule 50(a):⁶

The Form 1058

1. As part of prior collection efforts, joint Form 1058s, notice of intent to levy, were sent to Charles and Linda Franck at Mr. Franck's address.

2. Plaintiff did not see these Form 1058 notices prior to commencement of collection activities by Defendant herein.

3. Between 1980 and 1987, Plaintiff filed tax returns with the IRS, listing her current residence address.

4. During the first meeting between Plaintiff and Defendant at the IRS offices on June 23, 1987, Defendant struck out the "10-day" language from the Form 1058 notice of intent to levy and wrote in his own hand the word "immediately" in its place. He then handed the Form 1058 to Plaintiff.

Plaintiff's Statements she was not Liable for the Tax

5. Plaintiff repeatedly stated to Defendant throughout the collection activities that she was not liable for the tax.

6. Charles Franck stated to Defendant that the tax was not Plaintiff's responsibility.

7. Charles Franck had an agreement with Plaintiff that he would be responsible for any liability due to the IRS as a result of the amended joint return.⁷

8. In support of her argument that she did not owe the tax, Plaintiff, through her attorney Mr. Gartland, gave Defendant, on July 7, 1987, a copy of her individual (single status) 1979 Form 1040 showing a $78.00 refund due.

9. Plaintiff alleged that she did not consent to the filing of the joint amended return for 1979.⁸

The Form 900

10. When first presented with the Form 900, which would extend the statute of limitations on collection, during the meeting with Defendant at the IRS offices on June 23, 1987, Plaintiff refused to sign the form and requested more time to discuss the matter with her new husband.⁹

11. Defendant gave Plaintiff a blank copy of the Form 900 to take home to review with her husband, and Plaintiff was to let Defendant know by telephone on the morning of June 24, 1987 whether she would agree to sign the waiver form. Defendant told Plaintiff collection activity would begin immediately if she did not agree to extend the statute of limitations by the Form 900.¹⁰

12. On the morning of June 24, 1987, Plaintiff telephoned Defendant and stated she would not sign the Form 900. Later that morning, Plaintiff changed her mind, signed the blank Form 900 given to her by Defendant, and gave it to Charles Franck. Mr. Franck also signed the blank form and delivered it to the IRS offices.¹¹

13. Defendant did not see the form personally until he was in his office several days later.

14. Plaintiff, through her attorney Mr. Gartland, challenged the Form 900 signed in blank by herself and Mr. Franck. That challenge occurred at the time Mr. Gartland and Defendant first met on July 7, 1987 when Mr. Gartland witnessed Defendant filling in the remaining information on the Form 900 signed by Plaintiff and Mr. Franck in blank.

15. At some time thereafter, Mr. Gartland recanted his challenge as to the Form 900, and so advised Defendant several times by the end of July.

16. At some time thereafter, also by the end of July, Defendant received advisory opinions by two persons in the office of the IRS legal counsel that the Form 900 signed in blank by Plaintiff and Mr. Franck and later filled in by him was valid.

17. If the Form 900 was valid, it would have extended the statute of limitations and obviated the need for immediate collection activities.

The Collection Activity

18. On June 24, 1987, after receiving the phone call from Plaintiff saying she would not sign the Form 900, Defendant personally served a notice of wage levy on Plaintiff's employer.

19. On August 5, 1987, at the direction of his group manager, Charles Whitlow, Defendant prepared the seizure documents for Plaintiff's residence which were reviewed and approved by his group manager. That afternoon, Defendant seized Plaintiff's interest in her residence by personally serving the seizure documents on Plaintiff. The property was never sold.¹²

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