As such, the individual Plaintiffs’ Section 7426 claim should be dismissed under Fed. R. Civ. P. 12(b)(1), or at a minimum, they should be required to re-plead and articulate how they purportedly have an interest in the corporation’s seized property.9 9 Perhaps, the individual Plaintiffs are claiming to have an interest in some of the seized property that was not part of the inventory (i.e. the $7,834 “replacement cost” claim for items allegedly taken outside the scope of the Notice of Seizure [Doc. #1, ¶42] ), as they state that “some of the Case 3:17-cv-00609-B Document 14 Filed 05/01/17 Page 13 of 18 PageID 103 Page 10 of 14 2. The Court Should Dismiss Several of the Claimed Damages of the Corporate Defendant, Tony and Mii’s, Inc. Several of the claimed damages of Tony and Mii’s, Inc. are either legally insufficient as a matter of law (and subject to dismiss

Plaintiffs’ Requests For Pre-Judgment Interest Pursuant To 26 U.S.C. § 7426(g) and Attorneys’ Fees and Costs Pursuant to 26 U.S.C. § 7430 Should Be Dismissed Plaintiffs seek pre-judgment interest pursuant to 26 U.S.C. § 7426(g) and attorneys’ fees and costs pursuant to 26 U.S.C. § 7430. 26 U.S.C. § 7426(g) provides for interest on a wrongful levy claim judgment, and 26 U.S.C. § 7430 provides for costs and fees to a prevailing party. Because no party has prevailed in this case with respect to Plaintiffs’ wrongful levy claim, these requests are premature and should be dismissed if the Court dismisses the Plaintiffs’ wrongful levy claim.

Case 2:15-cv-05042-SVW Document 8 Filed 09/14/15 Page 27 of 34 Page ID #:326   19 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 26 27 28 interest of the United States in requiring other claimants of the seized property to bring their claims quickly. United Sand and Gravel, 624 F.2d at 739; see also EC Term of Years Trust, 127 S. Ct. at 1766 (reviewing the legislative history and stating that “(t)he demand for greater haste when a third party contests a levy is no accident”); United Sand and Gravel, 624 F.2d at 739 (wrongful levy suit under 26 U.S.C. § 7426 is the “exclusive remedy” for non- taxpayers wishing to challenge a levy); Norem v. Norem, Civil Action No. 3:07-cv-0051, 2008 WL 2245821, at *6-*7 (N.D. Tex. June 2, 2008) (same).16 Because LFG’s wrongful levy claim is untimely and Mazur’s liabilities remain outstanding, this Court should conclude that the IRS can retain the stock certificate. 2.

Consequently, a person suing under section 7426(a)(1) cannot challenge the validity of the assessment. 26 U.S.C. § 7426(c); Shannon v. United States, 521 F.2d 56, 59 (9th Cir. 1975); see also Aspinall v. United States, 984 F.2d 355, 357 (10th Cir. 1993). Not only is there no waiver of sovereign immunity permitting Ms. Mamedova’s action against the United States, her action, which seeks to prevent the collection of 2009 and 2010 income taxes by levy, is expressly prohibited by the Anti-Injunction Act.

Accordingly, while the United States has waived its sovereign immunity for wrongful-levy actions generally, Plaintiff is Case 2:16-cv-00554-PMW Document 8 Filed 08/12/16 Page 8 of 15 7 ineligible to file such an action. To the extent Plaintiff’s allegations are construed as a claim for a wrongful-levy action under 26 U.S.C § 7426(a), such an action is barred because Plaintiff lacks standing to bring a wrongful-levy claim under that statute, and so the Court lacks jurisdiction to consider this claim. E. This action is expressly barred by the Anti-Injunction Act and the Declaratory Judgment Act.

Ordonez v. United States, 680 F.3d 1135, 1137 (9th Cir. 2012).16 To the extent that the wrongful levy claim is part of the matters before the Court, it is clear that sovereign immunity does not forbid such claims. 26 U.S.C. § 7426(a)(1). F. IRS’S POSSESSION OF THE SHARES DOES NOT RENDER THIS MOTION MOOT.

That argument fails on three grounds. A. MAILED NOTICE OF LEVY IS INEFFECTIVE UNDER I.R.C. § 6335 I.R.C. § 7426 permits the non-taxpayer, such as LFG, whose property has been wrongfully levied upon to bring civil suit against the United States. The statute of limitations for claims brought under section 7426 is nine (9) months from the date of levy.12 26 U.S.C. § 6532(c)(1).

Under section 7426, a party other than the delinquent tax payer may seek injunctive relief to remedy a wrongful levy. 26 U.S.C. § 7426(a)(1), (b); see also Sharp Mgmt., LLC v. United States, No. C07-402JLR, 2007 WL 1367698, at *2 (W.D. Wash. May 8, 2007) (citing Shannon v. United States, 521 F.2d 56, 60 n. 10 (9th Cir. 1975)).

LEGAL ARGUMENT I. A Preliminary Injunction and Temporary Restraining Order Are Necessary The Court is authorized by 26 U.S.C. § 7426, to grant relief from the Levies. Plaintiffs are entitled to a preliminary injunction and a temporary restraining order pursuant to Federal Rule of Civil Procedure 65 and Internal Revenue Code (the “Code”) section 7426(b)(1).

15 See, e.g., States v. Badger, 930 F.2d 754, 756 (9th Cir. 1991) (holding that “if any person wishes to contest [an IRS] levy, that person must bring a wrongful levy action under I.R.C. § 7426 or other provisions specified in the Anti- Injunction Act”). This action is not (and could not be) brought under 26 U.S.C. § 7426, because Ms. Saepoff is not a person “other than the person against whom is assessed the tax out of which such levy arose.” Similarly, none of the other exceptions listed in 26 U.S.C. § 7421(a) apply to Ms. Saepoff’s claims.