Normand v. Cox Commc'ns, LLC

• Decision Date: 30 January 2012
• Docket Number: Civil Action No. 11–2476.
• Citation: 848 F.Supp.2d 619
• Parties: Newell NORMAND, Sheriff and Ex–Officio Tax Collector for the Parish of Jefferson v. COX COMMUNICATIONS, LLC.
• Court: U.S. District Court — Eastern District of Louisiana

848 F.Supp.2d 619

Newell NORMAND, Sheriff and Ex–Officio Tax Collector for the Parish of Jefferson

v.COX COMMUNICATIONS, LLC.

Civil Action No. 11–2476.

United States District Court, E.D. Louisiana.

Jan. 30, 2012.

Kenneth Charles Fonte, Golden & Fonte, Metairie, LA, for Plaintiff.

Martin E. Landrieu, Phillip J. Antis, Jr., Gordon, Arata, McCollam, Duplantis & Eagan, New Orleans, LA, Eric S. Tresh, Madison J. Barnett, Sutherland, Asbill & Brennan, LLP, Atlanta, GA, for Defendant.

ORDER AND REASONS

SARAH S. VANCE, District Judge.

Before the Court is plaintiff Newell Normand's motion to remand. Because comity concerns counsel against the exercise of federal jurisdiction in this case, the Court grants plaintiff's motion.

I. BACKGROUND

This case arises out of a tax dispute between plaintiff Newell Normand, the sheriff and ex officio tax collector for Jefferson Parish, Louisiana, and defendant Cox Communications, Inc., a Delaware limited liability company with offices in Jefferson Parish. The dispute concerns the applicability of a Louisiana sales tax to Cox's video programming services. The tax is imposed “upon the sale at retail, the use, the consumption, the distribution, and the storage for use or consumption in this state, of each item or article of tangible personal property,” La. R.S. § 47:302(A), and “upon all sales of services.” La. R.S. § 47:302(C)(1). Cox argues that because its video programming services are not “tangible personal property” and are not listed among the state's taxable “services,” seeLa. R.S. § 47:301(14), they are not subject to the tax.

On December 30, 2010, the Parish issued and mailed two notices of tax delinquency assessing Cox for back taxes allegedly owed.¹ Cox was permitted any of three alternative remedies under the Uniform Local Sales Tax Code to challenge the Parish's sales tax assessments: (1) La. R.S. § 47:337.51 permitted Cox to request an administrative hearing to protest the assessment, and afforded a right to appeal to district court an administrative decision rejecting the post-assessment protest; (2) La. R.S. § 47:337.63 permitted Cox to pay the assessment under protest and sue for a refund in district court; and (3) La. R.S. § 47:337.64 permitted Cox to post a commercial bond or another security and sue in district court to contest the assessments.²

Cox claims to have availed itself of the first of these options, although the Parish contends that Cox's efforts were inadequate under the law. While La. R.S. § 47:337.51 was amended in January 2011, the parties do not dispute that the pre-amendment version governs this case. That statute reads, in relevant part:

A. Having assessed the amount determined to be due, the collector shall send a notice by certified mail to the taxpayer against whom the assessment is imposed.... This notice shall inform the taxpayer of the assessment and that he has sixty calendar days from the date of the notice to (a) pay the amount of the assessment; (b) request a hearing with the collector or; (c) pay under protest in accordance with R.S. 47:337.63.

B. If any dealer shall be aggrieved by any findings or assessment of the collector, he may, within thirty days of the receipt of notice of the assessment or finding, file a protest with the collector in writing ... and may request a hearing. Thereafter, the collector shall grant a hearing to said dealer, if a hearing has been requested, and may make any order confirming, modifying or vacating any such finding or assessment....

La. R.S. § 47:337.51 (2010) (emphasis added). Part (A) of the above statute ostensibly affords a party 60 days to protest the assessment, while Part (B) offers only 30 days. As Cox filed its protest and request for a hearing with the Parish 55 days after the final assessment,³ the timeliness of the protest thus depends upon the proper interpretation of the statute. The Parish contends that the notice requirement of La. R.S. § 47:337.51(A) does not set deadlines for invoking taxpayer remedies to challenge the assessment, but rather, fixes a time period during which the tax collector cannot execute a writ of distraint to collect the assessment. See R. Doc. 13–1 at 5. Cox, meanwhile, urges a reading that would grant a party the later of 60 days from “the date of the notice” under part (A) and 30 days from “the receipt of the notice” under part (B) in order to challenge the assessment. See R. Doc. 16 at 5.

Because Cox did not timely and properly invoke its remedies to challenge the assessment, the Parish contends that La. R.S. § 47:337.51(C) precludes a court from granting it relief from the assessment:

(1) No assessment made by the collector shall be final if it is determined that the assessment was based on an error of fact or of law. An “error of fact” for this purpose means facts material to the assessment assumed by the collector at the time of the assessment to be true but which subsequently are determined by the collector to be false. “Error of law” for this purpose means that in making the assessment the collector applied the law contrary to the construction followed by the collector in making other assessments.

(2) The determination of an error of fact or of law under this Subsection shall be solely that of the collector, and no action against the collector with respect to the determination shall be brought in any court, and no court shall have jurisdiction of any such action, it being the intent of this Subsection only to permit the collector to correct manifest errors of fact or in the application of the law made by the collector in making the assessment; however, all reductions of assessments based on such errors, except estimated assessments made due to the failure of the taxpayer to file a proper tax return, must be approved and signed by the collector. Estimated assessments made due to the failure of the taxpayer to file a proper tax return may be corrected by the acceptance of the proper tax return and must be approved by the collector or his designee.”

La. R.S. § 47:337.51(C) (emphasis added).

Once an assessment becomes final, La. R.S. § 47:337.45(A) affords the Parish three alternative remedies to enforce and collect the sales taxes owed: (1) assessment and distraint, as provided in La. R.S. § 47:337.48–47:337.60; (2) summary court proceeding, as provided in La. R.S. § 47:337.61; and (3) ordinary suit under the provisions of the general laws regulating actions for the enforcement of obligations. The choice as to which remedy to pursue belongs to the Parish. SeeLa. R.S. § 47:337.45(B) (“The collector may choose which of these procedures he will pursue in each case[.]”).

The Parish selected the second option, which affords a unique set of procedural and evidentiary rules:

(1) All such proceedings, whether original or by intervention or third opposition, or otherwise, brought by or on behalf of the taxing authority, or by or on behalf of the collector, for the determination or collection of any tax, interest, penalty, attorney fees, costs or other charge claimed to be due shall be summary and shall always be tried or heard by preference, in all courts, original and appellate, whether in or out of term time, and either in open court or chambers, at such time as may be fixed by the court, which shall be not less than two nor more than ten days after notice to the defendant or opposing party.

(2) All defenses, whether by exception or to the merits, made or intended to be made to any such claim, must be presented at one time and filed in the court of original jurisdiction prior to the time fixed for the hearing, and no court shall consider any defense unless so presented and filed. This provision shall be construed to deny to any court the right to extend the time for pleading defenses; and no continuance shall be granted by any court to any defendant except for legal grounds set forth in the Louisiana Code of Civil Procedure.

(3) That all matters involving any such claim shall be decided within forty-eight hours after submission, whether in term time or in vacation, and whether in the court of first instance or in an appellate court; and all judgments sustaining any such claim shall be rendered and signed the same day, and shall become final and executory on the fifth calendar day after rendition. No new trial, rehearing or devolutive appeal shall be allowed. Suspensive appeals may be granted, but must be perfected within five calendar days from the rendition of the judgment by giving of bond, with good and solvent security, in a sum double that of the total amount of the judgment, including costs. Such appeals, whether to a court of appeals or to the supreme court, shall be made returnable in not more than fifteen calendar days from the rendition of the judgment.

(4) Whenever the pleadings filed on behalf of the taxing authority, or on behalf of the collector, shall be accompanied by an affidavit of the collector or of one of his assistants or representatives or of the counsel or attorney filing the same, that the facts as alleged are true to the best of the affiant's knowledge or belief, all of the facts alleged in said pleadings shall be accepted as prima facie true and as constituting a prima facie case, and the burden of proof to establish anything to the contrary shall rest wholly on the defendant or opposing party.

La. R.S. § 47:337.61.

On September 28, 2011, The Parish filed the action in state court to collect the taxes that it argues are owed.⁴ On October 3, Cox removed the matter to this Court, invoking diversity jurisdiction.⁵ The Parishfiled this motion to remand on November 1, contending that comity considerations and/or other abstention principles require this Court to abstain.⁶ Specifically, the Parish contends that this Court's exercise of jurisdiction will disrupt exercise of the tax administration remedies available to it by statute, as the Federal Rules of Civil Procedure, Federal Rules of Appellate Procedure, and Federal Rules...