Opinion
CA3:95-CV-1130-BC.
May 21, 1997
MEMORANDUM OPINION AND ORDER
Before the court is United States' Motion to Dismiss in Part or for Partial Summary Judgment and Memorandum in Support, filed January 30, 1997. At issue is whether the doctrine of sovereign immunity bars the plaintiff's claims against the United States and deprives the court of jurisdiction. Having reviewed the pertinent pleadings, the court GRANTS the motion for the reasons that follow.
I. Background
These uncontroverted background facts are taken from Plaintiff's Complaint, Plaintiff's Amended Complaint, and United States' Motion to Dismiss in Part or for Partial Summary Judgment. The plaintiff did not respond to the United States' motion.
Mid-South Erectors is an entity engaged in the business of subcontracting for government construction projects. Its sole owner and operator is James Moorer. Beginning in February of 1985, the IRS commenced seizure and levy procedures against the plaintiff in an effort to collect on an alleged outstanding tax liability. For the period ending March 31, 1984, the plaintiff was assessed a penalty in the amount of $61,706.67. Moorer's account was periodically credited for payments and for overpayment. On February 27, 1993, the plaintiff filed a Claim for Refund and Request for Abatement with the IRS. The IRS denied the request on June 7, 1993.
The plaintiff filed the instant lawsuit against the United States on June 7, 1995, alleging that the IRS assessment of tax liability was inaccurate and that the subsequent levies, seizures, and liens were unlawful. Plaintiff seeks compensatory and punitive damages, abatement of the 1984 penalty, and declaratory and injunctive relief. On January 30, 1997, the United States filed this Motion to Dismiss in Part or for Partial Summary Judgment, contending that sovereign immunity bars the plaintiff's claims.
II. Analysis
A. Summary Judgment Standard
Under Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment is appropriate when the pleadings and record evidence show that no genuine issue of material facts exists and that, as a matter of law, the movant is entitled to judgment. Little v. Liquid Air Corp. , 37 F.3d 1069, 1075 (5th Cir. 1994). "[T]he substantive law will identify which facts are material." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S. Ct. 2505, 2510 (1986). Only disputes about those facts will preclude the granting of summary judgment. Id. In a motion for summary judgment, the burden is on the movant to prove that no genuine issue of material fact exists. Latimer v. Smithkline French Lab. , 919 F.2d 301, 303 (5th Cir. 1990). If the non-movant bears the burden of proof at trial, the movant for summary judgment need not support the motion with evidence negating the opponent's case; rather, the movant may satisfy its burden by showing that there is an absence of evidence to support the non-movant's case. Id. ; Little , 37 F.3d at 1075.
Once the movant makes this showing, the burden shifts to the non-movant to show that summary judgment is not appropriate. Little , 37 F.3d at 1075 ( citing Celotex Corp. v. Catrett , 477 U.S. 317, 325, 106 S. Ct. 2548, 2553-54 (1986)). "This burden is not satisfied with `some metaphysical doubt as to the material facts,' . . . by `conclusory allegations,' . . . by `unsubstantiated assertions,' or by only a `scintilla' of evidence." Id. ( quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S. Ct. 1348, 1356 (1986); Lujan v. National Wildlife Fed'n, 497 U.S. 871, 871-73, 110 S. Ct. 3177, 3180 (1990); Hopper v. Frank, 16 F.3d 92, 97 (5th Cir. 1994); Davis v. Chevron U.S.A., Inc. , 14 F.3d 1082, 1086 (5th Cir. 1994)). Rather, the non-moving party must "come forward with `specific facts showing that there is a genuine issue for trial.'" Matsushita, 475 U.S. at 587, 106 S. Ct. at 1356 ( quoting FED. R. CIV. P. 56(e)).
In determining whether a genuine issue for trial exists, the court must view all of the evidence in the light most favorable to the non-movant. Richter v. Merchants Fast Motor Lines, Inc., 83 F.3d 96, 98 (5th Cir. 1996) (per curiam); Gremillion v. Gulf Coast Catering Co. , 904 F.2d 290, 292 (5th Cir. 1990). If the moving party seeks to establish the absence of a material fact through the submission of affidavits, depositions, admissions, or responses to interrogatories, the non-movant may not rely solely on mere allegations or denials. Rather, the non-movant must demonstrate the existence of an issue of material fact necessitating resolution by trial through similar evidentiary materials setting forth specific facts. FED.R.CIV.P. 56(e); Lechuga v. Southern Pac. Transp. Co., 949 F.2d 790, 794 (5th Cir. 1981). If the non-moving party fails to respond, the court may grant summary judgment so long as the movant has met its burden of establishing both an absence of a material fact issue and an entitlement to judgment as a matter of law. FED.R.CIV.P. 56(e); Securities and Exchange Comm'n v. Spence Green Chem. Co, 612 F.2d 896, 901 (5th Cir. 1980), cert. denied, 449 U.S. 1082, 101 S.Ct. 866, 66 L.Ed.2d 806 (1981); Boazman v. Economics Laboratory, Inc., 537 F.2d 210, 213 (5th Cir. 1976). Furthermore, the court is not required to provide the parties, even those proceeding pro se, with specific notice of the consequences of the failure to properly respond to a motion for summary judgment because FED.R.CIV.P. 56(e) affords adequate notice of the potential effect. Martin v. Harrison Cty. Jail, 975 F.2d 192, 193 (5th Cir. 1992) (per curiam). B. Sovereign Immunity
Generally, the United States is immune from suit unless it expressly waives immunity and consents to be sued. United States v. Mitchell, 463 U.S. 206, 212, 103 S.Ct. 2961, 77 L.Ed.2d 580 (1983); United States v. Testan, 424 U.S. 392, 399, 96 S.Ct. 948, 47 L.Ed.2d 114 (1976); Shanbaum v. United States, 32 F.3d 180, 181 (5th Cir. 1994). The immunity extends to the government's officers and agencies. Drake v. Panama Canal Comm'n, 907 F.2d 532, 534 (5th Cir. 1990). A federal court, therefore, has no jurisdiction over a suit brought against the United States in the absence of explicit statutory consent to suit. Smith v. Booth, 823 F.2d 94, 96-97 (5th Cir. 1987) (per curiam). The scope of such consent must be strictly interpreted and a waiver of sovereign immunity granted by Congress must be narrowly construed. McCarty v. United States, 929 F.2d 1085, 1087 (5th Cir. 1991); Smith, 823 F.2d at 96; Alexander v. United States, 829 F.Supp. 199, 100-01 (N.D.Tex. 1993), rev'd other grounds, 44 F.3d 328 (5th Cir. 1995). Further, any ambiguities must be resolved in favor of immunity. United States v. Williams, 514 U.S. 527, 115 S.Ct. 1611, 1613-14, 131 L.Ed.2d 608 (1995).
Federal courts enjoy limited jurisdiction and a complaint must affirmatively show the basis for jurisdiction. Kirkland Masonry, Inc. v. Commissioner of Internal Revenue, 614 F.2d 532, 533 (5th Cir. 1980) (per curiam). In his complaint, the plaintiff alleges that the United States consented to the instant lawsuit by conferring subject-matter jurisdiction under sections 1331, 1340, 1343, 1346(a)(1), 1356, 1357, and 1361 of the Judicial Code. With the exception of 28 U.S.C.A. §§ 1346(a)(1) and 1361, these provisions confer general jurisdiction and, without more, do not constitute a waiver of sovereign immunity. See 28 U.S.C.A. § 1331 (federal question jurisdiction); § 1340 (jurisdiction over actions arising under the Internal Revenue Code); § 1343 (jurisdiction over actions arising under the Civil Rights Act); § 1356 (jurisdiction over seizures made pursuant to any law of the United States not within admiralty or maritime jurisdiction); § 1357 (jurisdiction over actions for injuries incurred in enforcing federal laws). Because general jurisdictional statutes do not waive sovereign immunity, the plaintiff's reliance on these provisions as a basis for jurisdiction is misplaced. See e.g., Smith, 823 F.2d at 97; Fostvedt v. United States, 978 F.2d 1201 (10th Cir. 1992), cert. denied, 507 U.S. 988, 113 S.Ct. 1589, 123 L.Ed.2d 155 (1993); Murray v. United States, 686 F.2d 1320 (8th Cir. 1982), cert. denied, 459 U.S. 1147, 103 S.Ct. 788, 74 L.Ed.2d 994 (1983); Essex v. Vinal , 499 F.2d 226 (8th Cir. 1974), cert. denied, 419 U.S. 1107, 95 S.Ct. 779, 42 L.Ed.2d 803 (1975); Granse v. United States, 932 F.Supp. 1162 (D. Minn. 1996), aff'd ___ F.3d ___, 1997 WL 215330 (8th Cir. May 1, 1997); Johnson v. Treasury Dept., 917 F.Supp. 813 (N.D. Ga. 1995).
Additionally, the plaintiff may not invoke the court's jurisdiction under the federal mandamus statute. See 28 U.S.C.A. § 1361. Although the Fifth Circuit has held that § 1361 provides a limited waiver of sovereign immunity, that waiver is limited by the function of a mandamus action. See McClain v. Panama Canal Comm'n, 834 F.2d 452, 454 (5th Cir. 1987). A federal court exercising mandamus jurisdiction may order a federal agency or actor to perform a mandatory or ministerial duty imposed by law, but may not dictate the result or alter a substantive decision. Drake v. Panama Canal Comm'n, 907 F.2d 532, 534 (5th Cir. 1990). Additionally, three elements must be present before jurisdiction is conferred: (1) the plaintiff must have a clear right to the relief; (2) the defendant must have a clear duty to act; and (3) no other adequate relief must be available. McClain, 834 F.2d at 455. In the instant case, the plaintiff seeks review of the defendants' tax assessments and of the substantive legality of the defendants' actions under the Revenue Code. Although the plaintiff argues that the defendants acted unlawfully, he does not appear to contend that the defendants have failed to perform any specific duty. Rather, he seeks to alter the determination of a federal agency by challenging its substantive accuracy in a judicial forum. Finally, even if the relief sought by plaintiff could be provided through mandamus jurisdiction, such an action would not lie on the facts of this case. As discussed below, the plaintiff has not exhausted all other avenues of relief such that mandamus could be warranted. See id; see also United States v. Williams, 514 U.S. 527, 115 S.Ct. 1611, 1613-17, 131 L.Ed.2d 608, 614-15 (1995).
As a preliminary matter, the court acknowledges that the plaintiff's complaint fails to assert a particular statute or provision of the United States Constitution under which his cause of action arises. See generally Caterpillar Inc. v. Williams , 482 U.S. 386, 392, 107 S. Ct. 2425, 96 L.Ed.2d 318 (1987); O'Quinn v. Manuel, 773 F.2d 605, 607 (5th Cir. 1985). Nonetheless, failure to name a specific statute, or reliance on an incorrect statute, may not be fatal to a plaintiff's claim if the court can determine the appropriate source of jurisdiction from the allegations in the complaint. Boarhead Corp. v. Erickson, 923 F.2d 1011, 1018 (3rd Cir. 1991) ( citing 5 C. Wright A. Miller, Federal Practice and Procedure § 1209, at 112-13 (2d ed. 1990)); see also Searcy v. Houston Lighting Power Co. , 907 F.2d 562, 564 (5th Cir.) cert. denied, 498 U.S. 970, 111 S.Ct. 438, 112 L.Ed.2d 421 (1990) (requiring courts liberally construe pro se pleadings). In this case, the plaintiff's factual and jurisdictional pleadings are best characterized as an action for the recovery of funds erroneously or illegally retained by the Internal Revenue Service.
Section 1346 is a limited waiver of sovereign immunity that confers federal courts with jurisdiction over tax refund lawsuits brought by the taxpayer. See 28 U.S.C.A. § 1346(a); Flora v. United States, 357 U.S. 63, 78 S.Ct. 1079, 2 L.Ed.2d 1165 (1958), aff'd on reh'g, 362 U.S. 145, 80 S.Ct. 630, 4 L.Ed.2d 623 (1960); Smith , 823 F.2d at 97. However, the jurisdictional grant under § 1346 must be read to operate in conjunction with "other statutory provisions which qualify a taxpayer's right to bring a refund suit upon compliance with certain conditions." United States v. Dalm, 494 U.S. 596, 601, 110 S.Ct. 1361, 108 L.Ed.2d 548 (1990); see also Gustin v. United States, 876 F.2d 485, 488 (5th Cir. 1989).
Entitled "Civil Actions for Refund," § 7422 of the Internal Revenue Code requires that, prior to filing suit, a taxpayer must file an administrative claim for a refund. 26 U.S.C.A. § 7422(a); see also Shanbaum, 32 F.3d at 182; Smith, 823 F.2d at 97; Alexander, 829 F.Supp. at 201. Additionally, the Supreme Court has held that full payment of an IRS assessment is a prerequisite to filing a refund suit in federal district court. Flora, 362 U.S. at 170, 80 S.Ct. at 644, 4 L.Ed.2d 623; see Curry v. United States, 774 F.2d 852, 854 (7th Cir. 1985). The "full payment" rule applies to penalties assessed by the IRS. Rocovich v. United States, 933 F.2d 991, 993-94 (Fed. Cir. 1991); Horkey v. United States, 715 F.Supp. 259, 260-61 (D.Minn. 1989); Francis v. United States, 715 F.Supp. 973, 974 (D.Nev. 1988); see also Shore v. United States, 9 F.3d 1524 (Fed. Cir. 1993) (finding penalties must be prepaid where taxpayer disputes penalty on grounds not previously determined in principal liability refund claim). In this context, the burden is on the taxpayer to demonstrate the existence of federal jurisdiction. Abadi v. United States, 782 F.Supp. 59, 62 (E.D.Mich. 1992).
The statute provides that
No suit or proceeding shall be maintained in any court for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Secretary, according to the provisions of law in that regard, and the regulations of the Secretary established in pursuance thereof.26 U.S.C.A. § 7422(a).
The undersigned finds that the plaintiff has failed to meet his burden and that the defendants' motion for summary judgment must be granted. The summary judgment evidence before the court shows that the IRS assessed a $61,706.67 penalty against the plaintiff in 1984. See United States Mot. to Dismiss in Part or for Partial Summ. J., Exh. 1 (Certificate of Assessments and Payments). The evidence further shows that from April 15, 1987 to April 4, 1994, overpayment credits and payment credits were applied against the plaintiff's liability. See United States Mot. to Dismiss in Part or for Partial Summ. J., Exh. 1 (Certificate of Assessments and Payments). On February 27, 1993, the plaintiff filed a Claim for Refund and Request for Abatement for the full penalty assessed. See United States Mot. to Dismiss in Part or for Partial Summ. J., Exh. 3; Pl.'s Complaint, Exhibit (Letter dated June 7, 1993). In that Claim for Refund, Moorer sought to abate the entire $61,706.67 and listed the following dates of payment:
4/15/87 $3,159.00 12/23/87 $ 3.37 4/15/88 $ 963.00 4/15/90 $1,076.00 4/15/91 $ 646.00 4/29/91 $ 20.00 4/15/92 $2,238.00 See United States Mot. to Dismiss in Part or for Partial Summ. J., Exh. 1 (Certificate of Assessments and Payments), Exh. 3.The jurisdictional defect created by the plaintiff's failure to first pay the disputed penalty assessment in full is not cured by the fact that the plaintiff has made the requisite administrative claim for refund in accordance with § 7422(a). As stated above, a taxpayer may not challenge an IRS assessment in federal district court until the taxpayer has paid the full amount assessed and filed a timely refund claim. Humphreys v. United States, 62 F.3d 667, 672 (5th Cir. 1995); Smith v. Booth, 823 F.2d 94, 97 (5th Cir. 1987); Home v. United States, 519 F.2d 51, 52 (5th Cir. 1975); see also Flora, 362 U.S. at 170, 80 S.Ct. at 644, 4 L.Ed.2d 623. Furthermore, a partial payment will not support jurisdiction in district court. Pena v. United States, 883 F.Supp. 154, 156-57 (S.D.Tex. 1994), aff'd, 66 F.3d 520 (5th Cir. 1995); Myles v. United States, 810 F.Supp, 390, 394 (N.D.N.Y. 1992). Accordingly, Moorer has failed to establish the necessary jurisdictional prerequisites for bringing a claim pursuant to section 1346(a).
A taxpayer may contest his tax liability before an assessment is made or collection efforts ensue by filing a petition for redetermination in Tax Court. See 26 U.S.C. § 6213.
C. Constitutional Claims Against the United States
The plaintiff also vaguely asserts constitutional claims and seeks to enjoin the defendants from "engaging in activities which infringe upon Plaintiffs rights of all kinds and description." Construing his complaint liberally, the court will address this allegation as a Bivens-type claim asserting that federal officials have violated his constitutional rights. See Bivens v. Six Unknown Named Agents, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971). The United States has not waived sovereign immunity with respect to such claims. Arnsberg v. United States, 757 F.2d 971, 980 (9th Cir. 1985), cert. denied, 475 U.S. 1010, 106 S.Ct. 1183, 89 L.Ed.2d 300 (1986). Thus, the plaintiff's constitutional claims against the United States and its agencies are barred by the doctrine of sovereign immunity.
Additionally, any attempt to read the plaintiff's claim against the United States as a common law tort action must fail. The United States government has waived sovereign immunity for tort actions only to the extent set forth in the Federal Tort Claims Act. Perkins v. United States, 55 F.3d 910, 913 (4th Cir. 1995); 28 U.S.C.A. §§ 2671- 2680. By its very terms, the FTCA excludes "any claim in respect of the assessment or collection of any tax or customs duty, or the detention of any goods or merchandise by any officer of customs or excise or any other law-enforcement officer." 28 U.S.C.A. § 2680(c). This exemption applies to all tax-related claims. Alexander v. United States, 890 F.Supp. 598, 600 (N.D. Tex. 1995) (citing cases). Thus, sovereign immunity bars the plaintiff's tort claims against the United States and its agencies.
D. Claims Against Individual IRS Agents
In his complaint, the plaintiff also names as defendants the individual IRS agents who handled his case. As a general rule, sovereign immunity also bars claims against federal officers acting in their official capacity as agents of the United States. Robinson v. Overseas Military Sales Corp., 21 F.3d 502, 510 (2d Cir. 1994) ( citing Federal Deposit Ins. Corp. v. Meyer, 510 U.S. 471, 114 S.Ct. 996, 127 L.Ed.2d 308 (1994)); National Commodity Barter Ass'n v. Gibbs, 886 F.2d 1240, 1246 (10th Cir. 1989). The test to determine whether or not an action naming United States government officials is, in fact, a suit against the sovereign is if "the judgment sought would expend itself on the public treasury or domain . . . or if the effect of the judgment would be to restrain the government from acting, or to compel it to act." Dugan v. Rank, 372 U.S. 609, 620, 83 S.Ct. 999, 10 L.Ed.2d 15 (1963).
In this case, the relief sought by the plaintiff includes injunctive relief against the United States and payment of monies from the United States treasury. To the extent that the plaintiff names IRS officers in their official capacity, therefore, the instant lawsuit is a suit against the United States and any constitutional or tort claims are barred by the doctrine of sovereign immunity for the reasons stated previously.
The plaintiff also alleges, however, that the individual IRS agents have "engaged in a course of conduct outside of their scope of employment as employees of the IRS. . . ." Generally speaking, federal officials enjoy absolute immunity for torts committed while acting within the scope of their authority and qualified immunity for constitutional violations committed while acting within the scope of their authority. Butz v. Economou, 438 U.S. 478, 489-91, 98 S.Ct. 2894, 57 L.Ed.2d 895 (1978); Claus v. Gyorkey, 674 F.2d 427, 431 (5th Cir. 1982). In some instances, therefore, a claim against individual government employees may not be barred by immunity even without specific statutory consent to suit. Smith v. Booth, 823 F.2d 94, 98 (5th Cir. 1987). The viability of such claims turns on whether or not the official's actions were within the scope of his authority. See Butz, 438 U.S. at 489-91; Barr v. Matteo, 360 U.S. 564, 572, 79 S.Ct. 1335, 3 L.Ed.2d 1434 (1959); see also Dugan v. Rank , 373 U.S. 609, 621-22, 83 S.Ct. 999, 10 L.Ed.2d 15 (1963).
In this case, the plaintiff's complaint cannot survive summary judgment because his allegation that the IRS agents acted beyond the scope of their employment is wholly conclusory. The plaintiff appears to argue that because the IRS incorrectly assessed his tax liability and penalties, the conduct of the individual IRS agents in enforcing that assessment was unlawful and beyond the scope of their authority. Although the court must construe pro se pleadings liberally, the plaintiff does not allege any material facts in either the complaint or a response to the defendants' motion for summary judgment to support the proposition "that the officer, in committing that wrong, is not exercising the powers delegated to him by the sovereign." Larson v. Domestic Foreign Corp., 337 U.S. 682, 693, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949). Furthermore, a plaintiff cannot attempt to circumvent sovereign immunity by naming individual officers and employees as defendants. National Commodity Barter Ass'n, 886 F.2d at 1246. The court therefore concludes that, in the absence of any allegation or evidence that the conduct of the individual defendants was unrelated to their duties as IRS agents, the plaintiff has failed to establish a claim against the IRS agents in their individual capacity. See Smith, 823 F.2d at 94; Claus , 674 F.2d at 431.
III. Conclusion
The undersigned finds that the plaintiff has failed to fulfill the statutory requisites for filing a tax refund claim in district court. Additionally, all other potential claims are barred by sovereign immunity. Accordingly, this court is without jurisdiction and the defendants' Motion to Dismiss in Part or for Partial Summary Judgment must be GRANTED. Remaining before the court is the defendants' counterclaim against Moorer, filed April 4, 1996.