United States of America v. Pomerantz

MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM AND/OR LACK OF PERSONAL JURISDICTION AND/OR TO STRIKE AMENDED COMPLAINT

W.D. Wash.July 7, 2017

-1- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON SEATTLE DIVISION UNITED STATES OF AMERICA Plaintiff, v. JEFFREY P. POMERANTZ, Defendant. ) ) ) ) ) ) ) ) ) ) ) ) CASE NO. 2:16-cv-00689-JLR DEFENDANT’S MOTION TO DISMISS PLAINTIFF’S AMENDED COMPLAINT NOTE ON MOTION CALENDAR: FRIDAY JULY 28, 2017 DEFENDANT’S MOTION TO DISMISS PLAINTIFF’S AMENDED COMPLAINT COMES NOW, Plaintiff Jeffery Pomerantz, and pursuant to Federal Rules of Civil Procedure 12(b)(2), 12(b)(6), and 12(f), and under the doctrine of res judicata/collateral estoppel, respectfully submits this Motion to Dismiss Plaintiff’s Amended Complaint. As grounds therefor, Defendant states as follows: BACKGROUND The Plaintiff has filed a complaint against the Defendant on May 13, 2016 (Dkt. #1) in hopes of collecting on a fine levied by the IRS in the amount of $860,300.35. Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 1 of 9 -2- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 The Defendant is a US citizen resident in Canada. Other than some period of residency in California, has been primarily resident in Canada. He conducts no business and is not resident in the State of Washington. The Complaint was dismissed by an Order dated June 8, 2017 (Dkt. #16) by granting of the Defendants motion to dismiss, though leave was given to amend the Complaint. The Plaintiff filed an amended complaint on June 23, 2017 (Dkt. #17). This amended complaint contained some clerical corrections, removed some of the bank accounts which had been subject to the reporting penalty, and added some collateral information that is both erroneous (such as the Defendant having offshore income) and irrelevant. ARGUMENT I. The complaint should be dismissed for lack of personal jurisdiction under Rule 12(b)(2). Plaintiff alleges that jurisdiction is proper in this district pursuant to 28 U.S.C §§ 1131, 1345, and 1355(a). That allegation is insufficient on its face, and this case should be dismissed for lack of personal jurisdiction under Rule 12(b)(2). Due process requires that, in order for a forum to exercise personal jurisdiction over a non-resident defendant, unless he has certain minimum Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 2 of 9 -3- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 contacts. A court may not exercise jurisdiction over a defendant unless (1) the defendant has sufficient “minimum contacts” with the forum, and (2) the exercise of jurisdiction is reasonable and does not offend “traditional notions of fair play and substantial justice.” International Shoe Co. v. Washington, 326 US 310, 316 (1945). The defendant does not live in Washington State, does not have any business in Washington State or any meaningful connection. Plaintiffs bear the burden of making a prima facie showing of facts that, if credited by the Court, would suffice to establish jurisdiction. See Metro. Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 566-67 (2d Cir. 1996). In addition, Plaintiffs must allege specific facts supporting personal jurisdiction; they may not rely upon conclusory allegations. In re AstraZeneca Sec. Litig., 559 F. Supp. 2d 453, 467 (S.D.N.Y. 2008). Plaintiffs have failed to meet this burden. II. The complaint fails to state a claim on which relief can be granted The amended complaint warrants dismissal under Rule 12(b)(6). The Complaint alleges a judgment for civil penalty under 31 U.S.C. §5321(a)(5). This section permits a penalty for violations of 31 U.S.C. §5314. The Plaintiff with minimal research added dubious new facts which lead to their complaint and once again contains gross errors which would not be considered violations of 31 U.S.C. §5314. The Plaintiff has curiously removed some of the accounts which were allegedly subject to penalty on its initial pleading yet IRS continues to seek the Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 3 of 9 -4- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 same excessive penalty based on his inadvertent non disclosure of the Foreign Bank Account Reporting forms. Again there has been no explanation as to the amount of penalty. There has been no indication made that in the computation of said penalty, that funds transferred between accounts have not been counted twice. The United States has once again made significant factual errors, which if even true would not necessarily give rise to a claim, and cloud the fact that the Plaintiff has not made a claim to which this Court can grant relief. The amended claim makes claims which are improper and have no evidentiary support, nor will likely have evidentiary support after opportunity to investigate further. The Plaintiff has had over one year since the filing of its complaint on 05/13/2016 (Dkt. #1), and would have had an opportunity to amend as a matter of right, yet only made such corrections which in itself deemed necessary after finding itself unsuccessful in a motion to dismiss. The Plaintiff has shown recklessness in its investigation to this case prior to filing its initial complaint or in the intervening year before service, and by its own admission to changes has shown a disregard for the truth. The Plaintiff has also recklessly brought in an unrelated tax court case of which those claims related for the most part to income tax issues related to the sale of a primary residence, and not to the case at bar. These assertions needlessly harass and are disingenuous to the claims needed to survive a motion to dismiss under Rule 12(b)(6). None of the amendments bolster the Plaintiff’s position in overcoming the relief of 31 U.S.C. §5321 (a)(5)(B)(II) which states that “No penalty shall be Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 4 of 9 -5- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 imposed under subparagraph (A) with respect to any violation if such violation was due to reasonable cause.” Further, claims which were added that a professional preparer when doing the returns has complied with the law in no way constitute a pleading that the defendant himself willfully violated the law. The Defendant contends, and the Court has already held (Dkt. #16) that the Plaintiff has not pleaded any elements of this willfulness. Nowhere in even this amended complaint has the Plaintiff pleaded that there were any willful acts by the Defendant on the Defendant’s part and thus has not pleaded a claim to which relief can be granted. III. The Defendant asserts that the doctrine of Res Judicata and Collateral Estoppel apply in this case The Defendant asserts that the Plaintiff has not by its amendment changed any of the claims or issues in the previously litigated and disposed case. “The doctrine of res judicata prescribes that a “final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.” Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394, 398 (1981). For res judicata to apply, the “party asserting the bar must prove that (1) the parties are identical or in privity; (2) the first suit proceeded to a final judgment on the merits; and (3) the second claim is based on the same set of Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 5 of 9 -6- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 transactional facts as the first.” Ammex, Inc. v. United States, 334 F.3d 1052, 1055 (Fed. Cir. 2003) The complaint issued by the Plaintiff (Dkt. #1), was disposed by a final judgement of dismissal (Dkt. #16). The Court provided leave to amend the complaint, but any amendment would need to encompass new issues or claims as this was a judgement on the merits. In Turner v. First New Mexico Bank, 367 P.3d 852 (N.M. 2015) the dismissal without prejudice would have a claim preclusion effect if it were a final judgement on the merits involving the same parties and the same causes of action. Here, the parties litigated, and the trial court decided, the merits of the motion to dismiss. Thus, despite the judge’s inclusion of the words “without prejudice,” the order of dismissal still had claim preclusive effect, because “it fully disposed of the rights of the parties, and otherwise disposed of the matter to the fullest extent possible. In the Case at hand, even though the Court permitted an amending of the complaint, it may still be subject to a bar on relitigating the same issues and facts, and ultimately the judgement on the CIBC accounts was intended to be final. “The rules of finality, both statutory and judge made, treat a dismissal on statute-of-limitations grounds the same way they treat a dismissal for failure to state a claim, for failure to prove substantive liability, or for failure to prosecute: as a judgment on the merits.” see Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 228 (1995) The Order (Dkt. #16) was clear in that the judgement bifurcated the CIBC accounts from the Swiss accounts. The claim and penalty relating to the CIBC accounts was dismissed, but question remained regarding the Swiss accounts. The Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 6 of 9 -7- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Amended Complaint makes no separation of this claim and thus it is not only relitigating all claims and issues but it is contravening the Order insofar as the leave to amend was granted insofar as the specific Swiss accounts. The Plaintiff has added different uninvestigated facts but has not raised any new issues or claims and thus is barred from relitigating the issues claimed again. IV. The Defendant moves the court to strike the amended complaint under Rule 12(f) The Plaintiff has filed an amended claim which contains redundant, immaterial, impertinent and scandalous matter. It has originally added facts which they knew were false, and raises serious questions about the additional facts. It added facts regarding an unrelated tax court case without demonstrating its relevance in its pleading but with its only purpose to discredit the Defendant. Under Bell Atlantic Corp v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 566 U.S. 662 (2009) the Ninth Circuit as looked at amended complaints and determined that a plausible complaint requires “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged” Id. At 678. In comparing the original complaint and the amended complaint if the Court determines that there is no plausible chance of success the claims are dismissed. In Iqbal, the Court determined that the Plaintiff’s complaint “has not nudged [his] claims […] across the line from conceivable to plausible” at 680. Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 7 of 9 -8- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 The Plaintiff has not changed its claims and not made the claims any more plausible to be successful under the statute that they have assessed a penalty. Conclusion For all the foregoing reasons, the Court should enter an order dismissing the Amended Complaint in its entirety with prejudice. Dated this 7th day of July, 2017 /s/ Jeffrey P. Pomerantz Pro se Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 8 of 9 -9- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 CERTIFICATE OF SERVICE I hereby certify that on July 7, 2017 a true copy of the foregoing DEFENDANT’S MOTION TO DISMISS PLAINTIFF’S AMENDED COMPLAINT was filed electronically with the Clerk of the Court using the CM/ECF system, which will send a notification of such filing to the following: Paul Butler Trial Attorney, Tax Division U.S. Department of Justice P.O. Box 683 Washington DC. 20044 Counsel for Plaintiff United States of America /s/ Jeffrey P. Pomerantz Pro se Case 2:16-cv-00689-JLR Document 19 Filed 07/07/17 Page 9 of 9 -1- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON SEATTLE DIVISION UNITED STATES OF AMERICA Plaintiff, v. JEFFREY P. POMERANTZ, Defendant. ) ) ) ) ) ) ) ) ) ) ) ) CASE NO. 2:16-cv-00689-JLR PROPOSED ORDER [PROPOSED] ORDER AND NOW, after consideration of Jeffery Pomerantz’s motion to dismiss the amended complaint and any responses or replies thereto, it is hereby ORDERED that the complaint be dismissed with prejudice for failure to state a claim upon which relief can be granted. SO ORDERED Date __________ United States District Judge Presented by: Defendant Jeffrey A. Pomerantz Case 2:16-cv-00689-JLR Document 19-1 Filed 07/07/17 Page 1 of 1