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electing to "consider any defenses for failure to state a claim upon which relief can be granted which were raised in Defendants' Motion to Dismiss" despite the "untimeliness of their filings"—the answer (Doc. 9) was filed earlier on the same day as the motion to dismiss (Doc. 9)
Summary of this case from Wurth Baer Supply Co. v. StrouseOpinion
CIVIL ACTION NO. 3:CV-03-1045.
February 4, 2004
MEMORANDUM
Presently before the Court is Defendants' Motion to Dismiss. (Doc. 10.) I find that the Court has jurisdiction pursuant to 28 U.S.C. § 1331. Because Bivens actions do not extend to violations of due process rights in relation to tax assessment and collection, I will grant Defendants' motion.
BACKGROUND
The following facts are alleged by the Plaintiff. On August 26, 2002, the Internal Revenue Service (hereinafter IRS) notified Ms. Daniels that it intended to levy her property to satisfy an outstanding tax debt of $14,893.52. Ms. Daniels requested a hearing to challenge the intended levy. Frank Kowalkowski, a Settlement Officer for the IRS, responded to Ms. Daniels' request and informed her that a hearing was scheduled for April 10, 2003. After several correspondences regarding the location, Mr. Kowalkowski informed Ms. Daniels that the hearing was rescheduled for May 6, 2003. Ms. Daniels objected to the hearing location, but appeared at the hearing accompanied by Charles W. Daniels and Gary Daub.
Charles Daniels, Ms. Daniels' husband, accompanied Ms. Daniels to the hearing to act on her behalf. Mr. Daub accompanied Ms. Daniels to provide testimony, but Mr. Kowalkowski prohibited him from participating in the proceedings. Mr. Kowalkowski also prohibited the Danielses from tape-recording the proceeding. During the hearing, Mr. Kowalkowski refused to hear any challenges to the underlying liability of the $14,893.52. On May 23, 2003, Janis Suchyta issued a Notice of Determination in which she ruled against Ms. Daniels. Ms. Daniels then filed the present action.
Ms. Daniels is a pro se party who alleges violations of her constitutional right to due process. She initiated the action against two employees of the IRS in their individual capacity for depriving her of her "right to due process as guaranteed by Article V of the United States Constitution and 26 U.S.C. § 6320(b)(1), (b)(4) and (c)." (Doc. 1 at 8-9.) Defendants filed the present motion to dismiss simultaneously with their Answer. (Doc. 9.) The motion has been fully briefed and is now ripe for disposition.
LEGAL STANDARD
In deciding a motion to dismiss, a court should consider the allegations in the complaint, exhibits attached to the complaint and matters of public record. See Pension Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). The court need not assume that the plaintiff can prove facts that were not alleged in the complaint, see City of Pittsburgh v. West Penn Power Co., 147 F.3d 256, 263 (3d Cir. 1998), nor credit a complaint's "bald assertions" or "legal conclusions." Morse v. Lower Marion Sch. Dist., 132 F.3d 902, 906 (3d Cir. 1997).
DISCUSSION
Defendants requested the Court to extend the time period in which they could file responses to Plaintiff's Complaint. (Doc. 7.) My Order of September 8, 2003, granted the request and instructed Defendants to file their response by October 4, 2003. (Doc. 8.) Despite my Order, Defendants filed their Answer (Doc. 9) and Defendants' Motion to Dismiss (Doc. 10) on October 6, 2003. Defendants have offered no explanation for the untimeliness of their filings.
A motion to dismiss under Rule 12 must be filed before a responsive pleading. Fed.R.Civ.P. 12(b). Certain defenses, such as failure to state a claim upon which relief can be granted, can be raised by "any pleading permitted or ordered under Rule 7(a), or by motion for judgment on the pleadings, or at the trial on the merits." Fed.R.Civ.P. 12(h)(2). Defendants did not properly motion the Court because they filed an untimely motion to dismiss instead of a motion for judgment on the pleadings. However, the Court of Appeals for the Third Circuit has read Rule 12(h)(2) broadly. See Weaver v. Bowers, 657 F.2d 1356, 1360 (3d Cir. 1981). "It is desirable to raise the Rule 12(h)(2) defenses as early as possible, preferably before trial commences if the ruling could avoid any unnecessary trial time." Id.; see discussion Dart Drug Corp. v. Corning Glass Works, 480 F. Supp. 1091, 1094 n. 3 (D. Md. 1979). Therefore, I will consider any defenses for failure to state a claim upon which relief can be granted which were raised in Defendants' Motion to Dismiss.
Additionally, questions of subject matter jurisdiction should always be considered by the Court, regardless of procedural defects. Fed.R.Civ.P. 12(h)(3); see Mansfield, C. L.M. Ry. v. Swan, 111 U.S. 379, 384 (1884) (a party cannot waive a jurisdictional challenge via estoppel); see also Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583 (1999) (a federal court is obligated to raise the issue of jurisdiction if no other party does).
Defendants raise six grounds for dismissal of the action:
(1) The Court lacks subject matter jurisdiction because jurisdiction lies solely in the Tax Court.
(2) The Court lacks subject matter jurisdiction because Plaintiff filed the action beyond the permissible filing time period.
(3) The Court lacks subject matter jurisdiction because the Court is not authorized to issue declaratory relief respecting federal taxes.
(4) The Court lacks subject matter jurisdiction because the Court is not authorized to issue injunctive relief respecting federal taxes.
(5) The Court lacks subject matter jurisdiction because an action for constitutionally based relief against federal employees is impermissible when there are adequate legal remedies available.
(6) The Court lacks subject matter jurisdiction because an action for mandamus is not permissible when there are adequate legal remedies available.
The challenges raised in points 1, 2, and 5 attack the Court's jurisdiction generally, while the challenges raised in 3, 4, and 6 attack the Court's ability to grant the remedies requested by the Plaintiff. Because a finding in favor of the government on any of points 1, 2, or 5 would result in dismissal of the entire case, I will address those arguments first.
1) The Court's Jurisdiction as Impacted by the Tax Court
Defendants first argue that the Tax Court is the sole court vested with jurisdiction over this matter. Plaintiff counters that she is not appealing the hearing, rather, she is suing for violations of her constitutional rights. The Court recognizes that Plaintiff's Complaint does contain some ambiguities as to the exact nature of the action.
The Third Circuit Court of Appeals has emphasized a policy of liberally interpreting pro se complaints, so Plaintiffs' Complaint should be held to less stringent standards than formal pleadings drafted by lawyers. See Weaver v. Wilcox, 650 F.2d 22, 26 (3d Cir. 1981); Henderson v. Fisher, 631 F.2d 1115, 1117 (3d Cir. 1980); see also Haines v. Kerner, 404 U.S. 519, 520-21 (1972) (per curium). In her prayer for relief, Plaintiff requests, among other relief, "an Order that Frank Kowalkowski, and Janis L. Suchyta provide a fair hearing pursuant to Title 26 U.S.C. § 6320(b) (c)." (Doc. 1 at ¶ 3.) However, Plaintiff initiated the action against individuals, not the United States or the IRS, which would be the proper parties in an appeal.
In Bivens v. Six Unknown Federal Narcotics Agents, the United States Supreme Court created a cause of action that allows an aggrieved party to initiate an action against individuals who acted under the color of federal law to deprive the plaintiff of a constitutional right. 403 U.S. 388, 395 (1971). The action is not authorized by statute, but is brought under the constitution itself. Id. Plaintiff's Complaint clearly states in numerous places that she is seeking redress against individual federal employees for violations of her constitutional rights. She even states that her action is "a complaint for denial of due process." (Doc. 1 at ¶ 1.) In all, after reviewing Plaintiff's Complaint, Plaintiff has fashioned her case as a party seeking to initiate a Bivens action, not an appeal of an administrative tax hearing. Because this case is a Bivens action, the Court has jurisdiction pursuant to the statutory grant to hear "all civil actions arising under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331.
2) Filing Time Restrictions Impact on Jurisdiction
Next, the Defendants argue that because Plaintiff did not file her appeal within thirty days of the administrative decision, the Court lacks subject matter jurisdiction. I find this argument inapposite because, as I already ruled, this case is a Bivens action, not an appeal. Even if the thirty day limit applied tangentially to the Bivens action because of its relation to the tax hearing, the limit does not restrict the Court's subject matter jurisdiction.
Filing deadlines are jurisdictional in nature when they are a condition of the waiver of sovereign immunity. See United States v. Dalm, 494 U.S. 596, 608 (1990) (statute of limitations is a term of waiver of sovereign immunity); see also Koss v. United States, 69 F.3d 705, 707 (3d Cir. 1995). Sovereign immunity does not apply to Bivens actions, because an individual is the defendant, not the government. I find that any defect in Plaintiff's timing of the filing of this action does not affect the Court's subject matter jurisdiction.
3) Availability of Adequate Legal Remedies
Defendants next contend that the Court lacks subject matter jurisdiction because there are other adequate legal remedies available to the Plaintiff. In their Memorandum of Points Authorities in Support of Defendants' Motion to Dismiss (Doc. 11), Defendants cite to a single authority in support of their proposition, Schreiber v. Mastrogiovanni. 214 F.3d 148 (3d Cir. 2000). Unfortunately, the Schreiber court did not hold that the availability of adequate legal remedies strips a federal court of jurisdiction over a Bivens action. Id. at 149. The Schreiber court held that a Bivens action is not a proper cause of action when there are adequate legal remedies available to a plaintiff. Id. "[I]t is well settled that the failure to state a proper cause of action calls for a judgment on the merits and not for a dismissal for want of jurisdiction." Bell v. Hood, 327 U.S. 678, 682 (1946).
While Defendants' argument does not a raise a successful challenge to the Court's jurisdiction, it does raise grounds which entitle them to dismissal. When Congress provides meaningful safeguards or remedies for constitutional violations, the courts do not grant relief in a Bivens action. Schweiker v. Chilicky, 487 U.S. 412, 424-25 (1988). The Third Circuit Court of Appeals has held that the statutory scheme of appeals provided by the Internal Revenue Code demonstrates a Congressional intent to provide adequate legal remedies. Schreiber, 214 F.3d at 151. As such, the federal courts will not grant relief through a Bivens action. Id. at 152.
Even though § 7433 was narrowed in scope during the drafting process, Congress has provided other methods by which a taxpayer can challenge an assessment. A taxpayer may pursue an internal appeal with the IRS, sue for a refund in federal court, or appeal the assessment to the Tax Court. Attorney's fees may be recovered in certain circumstances when the taxpayer is successful.Id. at 151 (citations omitted). The Court will not ignore the Congressional remedies available to Plaintiff simply because Plaintiff elected not to engage these processes. Because Plaintiff has failed to state a claim upon which relief can be granted, I will grant Defendants' Motion to Dismiss. Since the case will be dismissed in its entirety, I do not need to address the Defendants' challenges to specific remedies requested by Plaintiff.
I decided the case on the merits without first resolving all of the challenges to the Court's subject matter jurisdiction. Ordinarily, a court is required to consider its jurisdiction before the merits of the case. See, e.g., Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 94 (1998); see also Employers Ins. of Wausau v. Crown Cork Seal Co., 905 F.2d 42, 45 (3d Cir. 1990). However, a statutory restriction of the Court's power to grant a particular remedy does not remove the Court's jurisdiction over the case generally. See Bethleham Mines Corp. v. United Mine Workers of Am., 476 F.2d 860, 862-63 (3d Cir. 1973) (discussing how the Norris-LaGuardia Act anti-injunction provision affected the Court's jurisdiction). Moreover, recent opinions from the Third Circuit Court of Appeals have interpreted Steel Co. as permitting courts to avoid difficult jurisdictional challenges by deciding a case on the merits so long as the Court is within the boundaries of Article III jurisdiction. See discussion Bowers v. Nat'l Collegiate Athletic Ass'n, 346 F.3d 402, 415-16 (3d Cir. 2003). Because the Court has general jurisdiction via § 1331, there is no question that the Court is within the bounds of Article III.
CONCLUSION
I find that the Court has jurisdiction pursuant to 28 U.S.C. § 1331, and neither the Tax Court's jurisdiction nor the filing deadlines for appealing a tax hearing limit the Court's jurisdiction because those provisions are only applicable for actions against the United States. I will grant Defendants' Motion to Dismiss because Bivens actions do not extend to violations of due process rights in relation to tax assessment and collection.An appropriate order follows.