Taylor v. USIRS
| Decision Date | 27 September 1995 |
| Docket Number | No. C 93-0180.,C 93-0180. |
| Citation | 186 BR 441 |
| Parties | Frank J. TAYLOR, Plaintiff, v. UNITED STATES of America INTERNAL REVENUE SERVICE, Defendant. |
| Court | U.S. District Court — Northern District of Iowa |
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Frank J. Taylor, pro se.
David B. Blair, Trial Atty., Tax Div., U.S. Dept. of Justice, Washington, DC, for defendant IRS.
The pro se complaint in this lawsuit was filed as an adversary complaint in the plaintiff's Chapter 7 bankruptcy proceedings. The plaintiff alleges that the United States Internal Revenue Service (IRS) violated his statutory and constitutional rights by providing certain information to the Iowa Department of Revenue and Finance (IDORF). The information provided was used in a state criminal prosecution of the plaintiff for income tax violations. The district court has since withdrawn its reference of this matter to the bankruptcy court pursuant to the IRS's motion. The matter currently before the court is the IRS's motion for summary judgment on the plaintiff's claims that the IRS violated the confidentiality provisions of 26 U.S.C. § 6103(d) and provisions of the Privacy Act, 5 U.S.C. § 552a.
Plaintiff Frank J. Taylor filed his pro se complaint in this matter on March 11, 1993, as an adversary complaint in his Chapter 7 bankruptcy filed on September 4, 1987. The defendant is the United States of America "acting as" the Internal Revenue Service (IRS). The complaint states two "claims for relief." The first claim for relief seeks declaratory judgment to the effect that (1) "any convention, treaty, compact or agreement existing between either the United States Government and the State of Iowa or the Internal Revenue Service and the Iowa Department of Revenue is invalid"; (2) 26 U.S.C. § 6103 is invalid, because it purports to include states as a portion of "tax administration" or to allow disclosure of information obtained by the IRS to states; (3) if 26 U.S.C. § 6103 is held to be valid, that it was violated in this case; (4) that the IRS violated Taylor's Fourth Amendment rights in unspecified ways; (5) that the IRS violated Taylor's Fifth Amendment rights to due process in unspecified ways; (6) and that Taylor has or intends to file his federal income tax returns for the years 1981 through 1988. The second "claim for relief" is for damages. In this claim, Taylor seeks damages, first, pursuant to 26 U.S.C. §§ 7432 and 7433 for violation of 26 U.S.C. § 6103, and, second, for violation of 5 U.S.C. § 552a. In addition, Taylor seeks damages for violation of his rights under the Fourth and Fifth Amendments to the United States Constitution. The IRS answered the complaint on April 15, 1993.
On April 19, 1993, the IRS moved to withdraw the reference of this matter to the bankruptcy court pursuant to 28 U.S.C. § 157 so that this matter could proceed before the district court. On May 19, 1993, the IRS moved for summary judgment and for the court to abstain from hearing the plaintiff's tax claims in favor of proceedings then before the U.S. Tax Court. On August 3, 1993, by order of now Chief Judge Michael Melloy, who had formerly been the bankruptcy judge hearing this matter, the reference of this matter to the bankruptcy court was withdrawn. Taylor subsequently filed a number of other complaints in district court, all purportedly related to his bankruptcy case, and each of which was treated as a separate lawsuit pursuant to the August 3, 1994, order. Pursuant to Chief Judge Melloy's order, the bankruptcy estate, which had been closed in 1992,1 was reopened to address Taylor's claims that he had assets available for distribution to creditors. Of greatest import here, however, was that the August 3, 1993, order also granted the IRS's motion to abstain from determining Taylor's tax liability. Thus, only that portion of the IRS's May 19, 1993, motion pertaining to summary judgment is currently pending before the court.2
The IRS's motion seeks summary judgment on Taylor's claim of violation of 26 U.S.C. § 6103, asserting that there is no genuine issue of material fact that the IRS complied with § 6103(d). The IRS also seeks summary judgment on this claim on the further ground that any disclosures the IRS made to the IDORF were based on a good faith interpretation of § 6103 as permitting the disclosures, such that no liability for violation of the statute, if violation there was, can be imposed upon the IRS. Finally, the IRS also seeks summary judgment on Taylor's Privacy Act claim, which alleges violation of 5 U.S.C. § 552a, on the ground that the IRS's disclosure of information to the IDORF was a "routine use" falling within an exception to liability under the Privacy Act.
Taylor filed a "preliminary resistance" to the IRS's motion for summary judgment on August 13, 1993, and a "supplement" to the record on August 31, 1993. There the matter languished for some time. On December 30, 1993, Chief Judge Melloy recused himself from this matter. Unfortunately, this case was not reassigned to any other judge until it was assigned to me on February 9, 1995.3
On April 10, 1995, Taylor filed a further "supplement to record and offer of proof in further resistance" to the motion for summary judgment, which had then been pending for the better part of two years. In his resistances, Taylor asserts that the IRS is not entitled to summary judgment, because the IRS's motion does not dispose of all of his claims. Taylor asserts that he has a "Bivens" action for violation of his constitutional rights, not just his statutory rights addressed in the IRS's motion, and that the IRS's motion for summary judgment does not address those constitutional claims. Furthermore, he asserts that the IRS has not addressed his claim that § 6103 is itself unconstitutional for various reasons, including violation of a constitutionally protected, fundamental expectation of privacy, which includes financial matters.
More to the point concerning claims on which the IRS has actually moved for summary judgment, Taylor asserts that there is a genuine issue of material fact as to whether or not the IRS made proper disclosures under § 6103, because he asserts that the IRS made improper oral disclosures pursuant to improper oral requests for information prior to receipt of any written request for information from the IDORF. Taylor also argues that the information disclosed to the IDORF exceeded the sort of "return information" that may be disclosed pursuant to § 6103, because it consisted of the entire investigative file generated by the IRS in its own aborted criminal investigation of Taylor. Finally, Taylor argues that no improper disclosure pursuant to § 6103 can be a "routine use" within the exception to liability under the Privacy Act.
Before turning to the factual background for the pending motions, the court must first consider the standards applicable to disposition of a motion for summary judgment.
The Eighth Circuit Court of Appeals recognizes "that summary judgment is a drastic remedy and must be exercised with extreme care to prevent taking genuine issues of fact away from juries." Wabun-Inini v. Sessions, 900 F.2d 1234, 1238 (8th Cir.1990). On the other hand, the Federal Rules of Civil Procedure have authorized for nearly 60 years "motions for summary judgment upon proper showings of the lack of a genuine, triable issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2555, 91 L.Ed.2d 265 (1986). Thus, "summary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed `to secure the just, speedy and inexpensive determination of every action.'" Wabun-Inini, 900 F.2d at 1238 (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2555, 91 L.Ed.2d 265 (1986)); Hartnagel v. Norman, 953 F.2d 394, 396 (8th Cir. 1992).
The standard for granting summary judgment is well established. Rule 56 of the Federal Rules of Civil Procedure states in pertinent part:
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