Shaffer v. CIR SERVICE

• Decision Date: 11 June 1981
• Docket Number: Civ. A. No. 81-702.
• Citation: 515 F. Supp. 748
• Parties: William H. SHAFFER v. COMMISSIONER OF INTERNAL REVENUE SERVICE, et al.
• Court: U.S. District Court — Eastern District of Louisiana

515 F. Supp. 748

William H. SHAFFER v. COMMISSIONER OF INTERNAL REVENUE SERVICE, et al.

Civ. A. No. 81-702.

United States District Court, E. D. Louisiana.

June 11, 1981.

William H. Shaffer, in pro per.

George C. Gibson, Amoco Production Co., New Orleans, La., William D. M. Holmes, Tax Division, U. S. Dept. of Justice, Washington, D. C., for defendants.

MEMORANDUM AND ORDER

JACK M. GORDON, District Judge.

Plaintiff, William H. Shaffer, filed this pro se complaint seeking to enjoin the defendants in collection of withholding taxes from wages received in his Amoco Production Company (hereinafter "Amoco") employment. Named defendants include the Commissioner of Internal Revenue; Jack Chivatero, District Director of Internal Revenue, New Orleans District, Southwest Region; Amoco; and Carolyn Leonard, Director, Internal Revenue Service Center Southwest Region. Mr. Shaffer's motion for a preliminary injunction and the defendants' responsive motion to dismiss was heard on March 25, 1981, with the Court ordering any additional memoranda filed by April 15, 1981, at which time the matter was taken under submission. Having reviewed the memoranda of counsel, the arguments, and the applicable law, the Court has decided to GRANT the defendants' motion to dismiss.

On or about May 30, 1980, the plaintiff filed a Federal Withholding Certificate, Treasury Form W-4, indicating that he was "exempt" from withholding taxes in 1980. Mr. Shaffer presumedly relied upon Section 3402(n) of the Internal Revenue Code of 1954 to justify his actions. This statute, which affords qualifying taxpayers relief from withholding, provides in part:

(n) EMPLOYEES INCURRING NO INCOME TAX LIABILITY—Notwithstanding any other provisions of this section, an employer shall not be required to deduct and withhold any tax under this chapter upon a payment of wages to an employee if there is in effect with respect to such payment a withholding exemption certificate (in such form and containing such other information as the Secretary may prescribe) furnished to the employer by the employee certifying that the employee—

(1) incurred no liability for income tax imposed under subtitle A for his preceding taxable year, and

(2) anticipates that he will incur no liability for income tax imposed under subtitle A for his current taxable year.

Ms. Leonard notified Mr. Shaffer by letter dated December 5, 1980, that Amoco had been instructed to disregard his submitted Form W-4 until a new form was received and to withhold tax as if he was single claiming no withholding allowances. The Internal Revenue Service (hereinafter "IRS") had found Mr. Shaffer's Form W-4 unacceptable owing to his 1979 tax liability and his anticipated 1980 tax liability. Mr. Chivatero's submitted affidavit reveals that the plaintiff's reported 1979 income tax liability totaled $2,962.00, such amount satisfied by taxes withheld from his 1979 Amoco salary. The affidavit also stated that Mr. Shaffer's 1980 income tax return had not been filed, no income tax deficiency had been asserted, nor had an assessment been made against him for any unpaid federal income taxes for the 1980 taxable year.

Plaintiff alleged that his action arises under 26 U.S.C. § 6213(a), the Injunctive Relief provisions of Rule 65 of the Federal Rules of Civil Procedure; and 28 U.S.C. Sections 1340¹ and 1331.²

Amoco having adopted the government entities' motion to dismiss, such motion addressed the jurisdictional and procedural issues raised by the case, thereby obviating, indeed, obliterating this Court's jurisdiction to consider the merits of the plaintiff's case. The defendants moved to dismiss the plaintiff's complaint on the following grounds:

(1) The doctrines of sovereign immunity and judicial immunity bar this action against officials of the United States of America.

(2) This Court lacks subject matter jurisdiction in this action.

(3) The Anti-Injunction Act, 26 U.S.C. § 7421 bars the plaintiff's claim for injunctive relief.

(4) The Declaratory Judgment Act, 28 U.S.C. § 2201, bars the plaintiff's claim for declaratory relief.

(5) The complaint fails to state a claim upon which relief can be granted.

As the sovereign immunity doctrine, the Anti-Injunction Act, and the Declaratory Judgment Act serve as dispositive authority mandating dismissal, the Court pretermits consideration of the remaining grounds asserted by defendants. Lynch v. Polaroid Corp., et al., 80-1 USTC ¶ 9191 (D.Mass. 1980), aff'd 627 F.2d 1088 (1st Cir. 1980).

I. THE ACTION IS BARRED BY THE DOCTRINE OF SOVEREIGN IMMUNITY.

With no allegation that the defendants acted in bad faith or outside the scope of their authority, the Court must conclude that the asserted claims against the IRS employee-defendants derive exclusively from their capacities as United States agents. Thus, where the relief sought would be obtained against the sovereign, a suit naming United States officers or agents shall be treated as a suit against the United States. Larson v. Domestic and Foreign Corp., 337 U.S. 682, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949); Land v. Dollars, 330 U.S. 731, 67 S.Ct. 1009, 91 L.Ed. 1209 (1947).

The doctrine of sovereign immunity conditions the viability of an action against the United States upon Congress' specific statutory immunity waiver. United States v. Sherwood, 312 U.S. 584, 61 S.Ct. 767, 85 L.Ed. 1058 (1941); E.E.O.C. v. First National Bank of Jackson, 614 F.2d 1004 (5th Cir. 1980); United States v. 5,553.80 Acres of Land, More or Less, Situated in Concordia Parish, State of Louisiana, 451 F.Supp. 220 (W.D.La.1978). An unequivocal expression of sovereign immunity's waiver, rather than any implication, is necessary. United States v. Mitchell, 445 U.S. 535, 100 S.Ct. 1349, 63 L.Ed.2d 607 (1980).

The statutory bases asserted by the plaintiff cannot suffice to waive sovereign immunity and therefore provide a valid jurisdictional basis. Sections 1331 and 1340, as general jurisdictional grants for certain actions, cannot sustain the instant action. In a taxpayer's suit concerning the validity of a tax, the court in Darling v. United States, 352 F.Supp. 565 (E.D.Cal., 1972) stated: "In their second cause of action for injunctive relief, plaintiffs assert jurisdiction under 28 U.S.C. Sections 1331 and 1340. These statutes do not, however, waive immunity of the United States from suit, and there is no jurisdiction over the United States unless Congress has consented by statute." See also A. L. Rowan & Son, General Contractors, Inc. v. Department of Housing and Urban Development, 611 F.2d 997 (5th Cir. 1980). Neither can Rule 65 of the Federal Rules of Civil Procedure sustain jurisdiction, as it provides for general injunctive relief, without contemplating a sovereign immunity waiver.

The Internal Revenue Code, Section 6213(a),³ with specified exceptions, covers factual situations in which tax assessment and collection thereof have been made or begun, with the mailing of a statutory deficiency to the taxpayer or while the deficiency's redetermination is being sought before the United States Tax Court. As Mr. Chivatero's affidavit states, neither of these prerequisites for injunctive relief are operative in this case. The plaintiff, therefore, cannot avail himself of § 6213(a)'s provisions negating § 7421(a)'s prohibitions.

Section 7421(a) disallows injunctive relief by providing, in pertinent part:

Except as provided in Sections 6212(a) and (c), 6213(a), 6672(b), 6694(c), 7426(a) and (b)(1), and 7429(b), no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person, whether or not such person is the person against whom such tax was assessed.⁴

Without fulfilling the exceptions of § 7421(a), to which the Court is referred by the plaintiff's invocation of § 6213(a), the suit cannot survive the defendants' motion to dismiss.

With no proper jurisdictional basis over a suit, a federal district court is under a mandatory duty to dismiss. Accordingly, the Court should not adjudicate the merits of the claim. Stanley v. Central Intelligence Agency, 639 F.2d 1146 (5th Cir. 1981). (Court was without jurisdiction to consider a case under the Federal Tort Claims Act when it fell within the bounds of a judicially created exception to the Act).

II. THE ACTION FOR INJUNCTIVE RELIEF IS BARRED BY 26 U.S.C. § 7421

Consideration of the Anti-Injunction Act, 26 U.S.C. § 7421(a), is found in the Supreme Court decisions of Enochs v. Williams Packing Co., 370 U.S. 1, 82 S.Ct. 1125, 8 L.Ed. 292 (1962); rehearing denied, 370 U.S. 965, 82 S.Ct. 1579, 8 L.Ed.2d 833 (1962) and in Bob Jones University v. Simon, 416 U.S. 725, 94 S.Ct. 2038, 40 L.Ed.2d 496 (1974). The latter case enunciated the Act's principal purpose as "the protection of the Government's need to assess and collect taxes as expeditiously as possible with a minimum of pre-enforcement judicial interference," which added to the former decision's statement of objective as "to require that the legal right to the disputed sums be determined in a suit for refund." The procedure thus aims at the United States' assurance of its lawful revenue's prompt collection.

In Enochs v. Williams Packing Co., supra, the Supreme Court fashioned a limited exception to Section 7421(a)'s seemingly absolute rule prohibiting injunctive relief. The Enochs decision conditioned an injunction on tax collection or assessment upon meeting a two-fold test: (1) if it is clear that under no circumstances the United States could ultimately prevail on the merits of the claim and (2) if equity jurisdiction otherwise exists. Otherwise, the District Court has no jurisdiction and must dismiss the complaint. The Court cannot find, under the most liberal view of the law and the facts commanded by Enochs, that the United States cannot establish its claim. Furthermore, plaintiff has alleged no facts supporting equity jurisdiction in the instant case. With no showing of irreparable...