Powell v. Internal Revenue Service et al

MOTION to Dismiss for Lack of Jurisdiction

D.D.C.May 30, 2017

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DISTRICT OF COLUMBIA WILLIAM E. POWELL, ) ) Plaintiff, ) ) v. ) ) INTERNAL REVENUE SERVICE, et al., ) ) Defendants. ) _______________________________________) Case No. 17-cv-00278 (JEB) DEFENDANTS’ MOTION TO DISMISS COMPLAINT Defendants INTERNAL REVENUE SERVICE, et al., hereby move to dismiss Plaintiff’s complaint for lack of subject-matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules Civil Procedure. Plaintiff seeks to compel the Internal Revenue Service (“Service”) to disclose various tax records pursuant to 18 U.S.C. § 1028 and 26 U.S.C. § 6103. Because Section 1028 is a criminal identity theft statute under which there is no civil cause of action, and because no remedy exists under Section 6103 to compel an agency to disclose records, this Court lacks subject matter jurisdiction. Accordingly, Plaintiff’s complaint should be dismissed. Attached to this motion in support thereof is a statement of points and authorities, and a proposed order. // // // // Case 1:17-cv-00278-JEB Document 8 Filed 05/30/17 Page 1 of 3 2 DATED: May 30, 2017 Respectfully submitted, DAVID A. HUBBERT Acting Assistant Attorney General CHANNING D. PHILLIPS United States Attorney /s/Joycelyn S. Peyton JOYCELYN S. PEYTON Trial Attorney, Tax Division U.S. Department of Justice Post Office Box 227 Washington, D.C. 20044 Tel: 202-514-6576 Fax: 202-514-6866 Joycelyn.S.Peyton@usdoj.gov Counsel for the United States Case 1:17-cv-00278-JEB Document 8 Filed 05/30/17 Page 2 of 3 3 CERTIFICATE OF SERVICE IT IS HEREBY CERTIFIED that service of Defendants’ Motion to Dismiss and supporting documents has been made on May 30, 2017, via the CM/ECF system, to Plaintiff WILLIAM E. POWELL, pro se. /s/ Joycelyn S. Peyton JOYCELYN S. PEYTON Trial Attorney, Tax Division U.S. Department of Justice Case 1:17-cv-00278-JEB Document 8 Filed 05/30/17 Page 3 of 3 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DISTRICT OF COLUMBIA WILLIAM E. POWELL, ) ) Plaintiff, ) ) v. ) ) INTERNAL REVENUE SERVICE, et al., ) ) Defendants. ) _______________________________________) Case No. 17-cv-00278 (JEB) STATEMENT OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANTS’ MOTION TO DISMISS COMPLAINT Defendants INTERNAL REVENUE SERVICE, et al., submit this statement of points and authorities in support of their motion to dismiss Plaintiff’s complaint for lack of subject- matter jurisdiction. Fed. R. Civ. P. 12(b)(1). Pursuant to 18 U.S.C. § 1028 (“Section 1028”) and 26 U.S.C. § 6103 (“Section 6103”), Plaintiff seeks to compel the Internal Revenue Service (“Service”) to disclose various tax records related to himself and to third party entities. However, because Section 1028 is a criminal identity theft statute under which no civil cause of action exists, and because there is no remedy under Section 6103 for nondisclosure of agency records, this Court lacks subject matter jurisdiction and Plaintiff’s complaint should be dismissed. STATEMENT OF FACTS The complaint initiating the present suit was filed on February 13, 2017. Dkt. No. 1 (“Compl.”). Plaintiff appears to be seeking various tax returns and other tax records related to himself and to the third party entities the Powell Printing Co., the Andrew Powell Printing, Co., and the Estate of William A. Powell. See Compl. at 1-2, 11-12 (Plaintiff’s prayer for relief). This is the fifth suit Plaintiff has initiated against the Service seeking tax records related to the Case 1:17-cv-00278-JEB Document 8-1 Filed 05/30/17 Page 1 of 6 2 foregoing persons and entities. See Powell v. IRS, No. 15-11033, 2016 WL 7473446 (E.D. Mich. Dec. 29, 2016); Powell v. IRS, No. 15-11616, 2016 WL 5539777 (E.D. Mich. Sept. 30, 2016); Powell v. IRS, No. 14-12626, 2015 WL 4617182 (E.D. Mich. July 31, 2015), Powell v. IRS, No. 16-1682 (D.D.C.). It is the second complaint Plaintiff has filed in this Court against Defendants seeking the same. Powell v. IRS, No. 16-1682 (D.D.C.) (“Powell IV”). In fact, the records Plaintiff appears to be seeking in this case are identical to the records he is seeking in Powell IV, which is currently pending before this Court. See Compl. at 11-12; c.f. Powell v. IRS, No. 16- 1682, Dkt. No. 26, 26-27 (plaintiff’s prayer for relief). Defendants were served on March 29, 2017 and April 26, 2017. Dkt. Nos. 6, 7. Defendants have until May 30, 2017 to file an answer or otherwise respond.1 Dkt. No. 6. STANDARD OF REVIEW Federal Rule of Civil Procedure 12(b)(1) provides for the dismissal of an action for lack of subject matter jurisdiction. See Fed. R. Civ. P. 12(b)(1). Federal courts are courts of limited jurisdiction, and the law presumes that “a cause lies outside this limited jurisdiction.” Rasul v. Bush, 542 U.S. 466, 489 (2004) (quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)); see also Gen. Motors Corp. v. EPA, 363 F.3d 442, 448 (D.C. Cir. 2004) (“As a court of limited jurisdiction, we begin, and end, with an examination of our jurisdiction.”). It is the plaintiff's burden to establish that the court has subject matter jurisdiction. Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992). 1According to the docket, Defendants’ answer was due by May 28, 2017. However, because May 28 was a Sunday and May 29 was a federal holiday, Defendants respectfully submit this motion on May 30, 2017. Case 1:17-cv-00278-JEB Document 8-1 Filed 05/30/17 Page 2 of 6 3 Although pro se complaints are held to “less stringent standards than formal pleadings drafted by lawyers,” they nevertheless “must comply with the Federal Rules of Civil Procedure.” Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per curiam) (citation omitted); Idrogo v. Foxx, 990 F. Supp. 2d 5, 6 (D.D.C. 2013) (citation omitted). 2 To determine whether jurisdiction exists, a court may “consider the complaint supplemented by undisputed facts evidenced in the record, or the complaint supplemented by undisputed facts plus the court's resolution of disputed facts.” Coal. for Underground Expansion v. Mineta, 333 F.3d 193, 198 (D.C. Cir. 2003). ARGUMENT This Court lacks subject matter jurisdiction because (1) Section 1028 is a criminal statute under which there is no civil cause of action, and (2) there is no remedy under Section 6103 for nondisclosure of agency records. Accordingly, this Court should dismiss Plaintiff’s complaint with prejudice. A. No civil cause of action under 18 U.S.C. § 1028 “As a general rule, criminal statutes do not create a private right of action, meaning they cannot be relied on by a civil plaintiff to state a claim for relief.” Saunders v. Davis, No. 15-CV- 2026 (RC), 2016 WL 4921418, at *13 (D.D.C. Sept. 15, 2016). See also Keyter v. Bush, No. 04- 2 Defendants characterize the complaint as “appearing to seek records” because, contrary to the dictates of Rule 8 requiring a “short and plain statement of the claim showing that the pleader is entitled to relief,” Plaintiff’s complaint is 103 pages long including exhibits, and it is unclear to Defendants the factual bases of the complaint and their relevance to the relief sought. Fed. R. Civ. P. 8(a)(2). See also Ciralsky v. C.I.A., 355 F.3d 661, 668-69 (D.C. Cir. 2004) (“Taken together, Rules 8(a) and 8(e)(1) underscore the emphasis placed on clarity and brevity by the federal pleading rules.”); T.M. v. District of Columbia, 961 F.Supp.2d 169, 174 (D.D.C. 2013) (“Still, a complaint that is excessively long, rambling, disjointed, incoherent, or full of irrelevant and confusing material” will patently fail the Rule’s standard) (internal quotation marks and citations omitted). Courts have found that failure to comply with Rule 8 is valid grounds for dismissal. Ciralsky, 355 F.3d at 669 (explaining that “Rule 41(b) authorizes the court to dismiss either a claim or an action because of the plaintiff’s failure to comply with” Rule 8). Case 1:17-cv-00278-JEB Document 8-1 Filed 05/30/17 Page 3 of 6 4 5324, 2005 WL 375623, at *1 (D.C. Cir. Feb. 16, 2005) (“…appellant cannot assert any claim pursuant to 18 U.S.C. §§ 4, 241, and 242, because, as criminal statutes, these statutes do not convey a private right of action.”); Rockefeller v. U.S. Court of Appeals for the Tenth Circuit, 248 F. Supp. 2d 17, 23 (D.D.C. 2003)) (“Plaintiff is precluded from asserting any claims pursuant to 18 U.S.C. §§ 242 and 371 because, as criminal statutes, they do not convey a private right of action.”). Furthermore, the “Supreme Court has refused to imply a private right of action in ‘a bare criminal statute.’” Prunte v. Universal Music Group, 484 F. Supp. 2d 32, 42 (D.D.C. 2007) (quoting Cort v. Ash, 422 U.S. 66, 79-80 (1975)). The statue under which Plaintiff seeks relief in this case is a criminal statute codifying the offense of identity fraud and related activity. 18 U.S.C. § 1028. Section 1028 of Title 18 provides, in relevant part: (a) Whoever, in a circumstance described in subsection (c) of this section-- (1) knowingly and without lawful authority produces an identification document, authentication feature, or a false identification document; (2) knowingly transfers an identification document, authentication feature, or a false identification document knowing that such document or feature was stolen or produced without lawful authority; (3) knowingly possesses with intent to use unlawfully or transfer unlawfully five or more identification documents (other than those issued lawfully for the use of the possessor), authentication features, or false identification documents; (4) knowingly possesses an identification document (other than one issued lawfully for the use of the possessor), authentication feature, or a false identification document, with the intent such document or feature be used to defraud the United States; (5) knowingly produces, transfers, or possesses a document- making implement or authentication feature with the intent such document-making implement or authentication feature will be used in the production of a false identification document or another document-making implement or authentication feature which will be so used; Case 1:17-cv-00278-JEB Document 8-1 Filed 05/30/17 Page 4 of 6 5 (6) knowingly possesses an identification document or authentication feature that is or appears to be an identification document or authentication feature of the United States or a sponsoring entity of an event designated as a special event of national significance which is stolen or produced without lawful authority knowing that such document or feature was stolen or produced without such authority; (7) knowingly transfers, possesses, or uses, without lawful authority, a means of identification of another person with the intent to commit, or to aid or abet, or in connection with, any unlawful activity that constitutes a violation of Federal law, or that constitutes a felony under any applicable State or local law; or (8) knowingly traffics in false or actual authentication features for use in false identification documents, document-making implements, or means of identification; shall be punished as provided in subsection (b) of this section. Penalties imposed under this statute range from monetary fines up to 30 years’ imprisonment. 18 U.S.C. § 1028(b). Section 1028 is a criminal statute that does not create a private right of action. See Saunders, 2016 WL 375623, at *1 (dismissing complaint for lack of subject matter jurisdiction because Section 1028 does not provide private right of civil action). See also Garay v. U.S. Bancorp, 303 F. Supp. 2d 299, 302-03 (E.D.N.Y. 2004) (holding that 18 U.S.C. § 1028, identity fraud, and 18 U.S.C. § 1341, mail fraud, do not create a private right of action). Accordingly, this Court should dismiss Plaintiff’s complaint for lack of subject matter jurisdiction. B. No remedy under 26 U.S.C. § 6301 for nondisclosure of agency records In relevant part, Section 6103 provides that “[r]eturns and return information shall be confidential,” but shall be open to inspection by or disclosure to a person with a material interest upon written request and satisfaction of the listed requirements. 26 U.S.C. § 6103(a), (e)(1). Upon a request that satisfies the requirements of Section 6103, the statute in essence permits the Service to disclose (or open to inspection) the requested tax return information. Id. Case 1:17-cv-00278-JEB Document 8-1 Filed 05/30/17 Page 5 of 6 6 However, as this Court recently held in Powell IV, Section 6103 operates as part of the larger FOIA framework and does not itself provide an independent basis for subject matter jurisdiction to compel disclosure of agency records. Powell v. IRS, No. 16-1682, Dkt. No. 25; see also Maxwell v. O’Neill, No. 00-01953, 2012 WL 31367754 (D.D.C. Sept. 12, 2002). Judicial review of an agency’s nondisclosure under Section 6103 is governed by the FOIA, and a plaintiff seeking to challenge the Services’ nondisclosure of tax documents under Section 6103 must seek relief under the FOIA. Maxwell, 2012 WL 31367754, *3-4; Linsteadt v. IRS, 729 F.2d 998, 999 (5th Cir. 1984) (holding that “while 6103 may supersede the Privacy Act, it does not supersede the FOIA.”), aff’d sub. nom. Maxwell v. Snow, 409 F.3d 354, 357-58 (D.C. Cir. 2005); Grasso v. IRS, 785 F.2d 70, 74 (3d Cir. 1986) (collecting concurring cases). This Court therefore lacks subject matter jurisdiction, and the complaint should be dismissed. CONCLUSION For the foregoing reasons, Plaintiff’s complaint should be dismissed with prejudice. Respectfully submitted, DAVID A. HUBBERT Acting Assistant Attorney General CHANNING D. PHILLIPS United States Attorney /s/Joycelyn S. Peyton JOYCELYN S. PEYTON Trial Attorney, Tax Division Counsel for the United States Case 1:17-cv-00278-JEB Document 8-1 Filed 05/30/17 Page 6 of 6 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DISTRICT OF COLUMBIA WILLIAM E. POWELL, ) ) Plaintiff, ) ) v. ) ) INTERNAL REVENUE SERVICE, et al., ) ) Defendants. ) ______________________________________ ) Case No. 17-cv-00278 (JEB) [Proposed] ORDER GRANTING DEFENANTS’ MOTION TO DISMISS Defendants having moved to dismiss Plaintiff’s complaint under Fed. R. Civ. P. 12(b)(1); and the Court having reviewed all pleadings and papers thereto; it is hereby ORDERED that: The Defendants’ motion to dismiss is GRANTED, and Plaintiff’s complaint is hereby DISMISSED with prejudice for lack of subject matter jurisdiction. Dated: _____________________, 2017 ____________________________________ JAMES E. BOASBERG Judge, United States District Court Case 1:17-cv-00278-JEB Document 8-2 Filed 05/30/17 Page 1 of 1