Opinion
C/A No. 3:02-0183-20BG [formerly Case No. 2001-CP-32-3062]
April 23, 2002
Report and Recommendation
The above-captioned case was removed by the United States from the Court of Common Pleas for Lexington County. The docket number for the state court action was Case No. 2001-CP-32-3062. Since the Rule 26.01 Interrogatories completed by the United States Attorney indicated that the above-captioned case is related to a pending civil action in this court involving the plaintiff (Roger Davenport), Audio Investments v. Dewey L. Robertson, Sr., et al., Civil Action No. 8:00-2847-20BG (DSC), the above-captioned case was assigned to the undersigned magistrate judge and to the Honorable Henry M. Herlong, Jr., United States District Judge.
Both the above-captioned case (Civil Action No. 3:02-0183-20BG) and the prior case (Civil Action No. 8:00-2847-20BG) arise out of Roger O. Davenport's refusal to file federal income tax returns for Calendar Years 1991, 1992, and 1993. Although the above-captioned case is a civil rights action against officials or employees of the Internal Revenue Service (hereinafter "the Service"), the prior case (Civil Action No. 8:00-2847-20BG) outlines the history of the plaintiff's tax liability.
This court may take judicial notice of Civil Action No. 8:00-2847-20BG. Aloe Creme Laboratories, Inc. v. Francine Co.. 425 F.2d 1295, 1296 (5th Cir. 1970). See also Colonial Penn Ins. Co. v. Coil, 887 F.2d 1236, 1239, 1989 U.S.App. LEXIS® 16328 (4th Cir. 1989) ("We note that 'the most frequent use of judicial notice is in noticing the content of court records.'"); Mann v. Peoples First National Bank Trust Co., 209 F.2d 570, 572 (4th Cir. 1954) (approving district court's taking judicial notice of prior suit with same parties: "We think that the judge below was correct in holding that he could take judicial notice of the proceedings had before him in the prior suit to which Mann and the Distilling Company as well as the bank were parties."); and United States v. Parker, 956 F.2d 169, 171, 1992 U.S.App. LEXIS® 1319 (8th Cir. 1992).
In a Report and Recommendation filed in Civil Action No. 8:00-2847-20BG on January 25, 2002, the undersigned outlined the relevant history of the tax matter:
The seeds of this civil action were sown by Roger O. Davenport, for the record amply demonstrates that Roger O. Davenport initiated on September 23, 1993, the first step in a series of fraudulent transfers to conceal assets from the Internal Revenue Service (hereinafter the "Service"), and attempted to place assets beyond the reach of federal taxation authorities. The above-captioned case is illustrative of consequences (whether intended or unintended) resulting from the activities of self-deluded tax protesters. * * *
* * * The relevant history of the above-captioned case can be redacted into several events (or, as it were, "causes and effects"). The events cover approximately a fifteen-year period:
July 22, 1985 Roger and Margaret Davenport purchase property for $22,000, and deed is properly recorded. See Government's Exhibit 8.
April 15, 1992 Roger Davenport fails to file Federal Income Tax Return for Calendar Year 1991
June 19, 1992 Audio Investments "Trust" filed in Maricopa County, Arizona. See Government's Exhibit 14.
April 15, 1993 Roger Davenport fails to file Federal Income Tax Return for Calendar Year 1992
September 23, Roger Davenport, purportedly, executes 1993 transfer of his interest in property to Faith Davenport (his daughter) for Ten Dollars ($10). See Government's Exhibit 9.
October 18, Pursuant to 26 U.S.C. (I.R.C.) § 6020(b), 1993 the Service prepares Substitute Return for Calendar Year 1992 for Roger Davenport
March 28, 1994 Margaret Davenport, purportedly, executes transfer of her interest in property to Faith Davenport (her daughter) for Ten Dollars ($10). See Government's Exhibit 10.
April 11, 1994 Pursuant to 26 U.S.C. (I.R.C.) § 6020(b), the Service prepares Substitute Return for Calendar Year 1991 for Roger Davenport
April 15, 1994 Roger Davenport fails to file Federal Income Tax Return for Calendar Year 1993
February 13, Service makes assessment against 1995 Roger Davenport for unpaid Calendar Year 1991 federal income taxes of $33,534.
June 19, 1995 Pursuant to 26 U.S.C. (I.R.C.) § 6020(b), the Service prepares Substitute Return for Calendar Year 1993 for Roger Davenport
July 3, 1995 Service makes assessment against Roger Davenport for unpaid Calendar Year 1992 federal income taxes of $34,111
October 23, Notice of Federal Tax Liens against 1995 Roger Davenport for 1991 and 1992 Federal Income Taxes filed in Lexington County
February 12, Service makes assessment against 1996 Roger Davenport for unpaid Calendar Year 1993 federal income taxes of $11,338.
March 21, 1996 Notices of Federal Tax Liens against Roger Davenport for 1993 Federal Income Taxes filed in Saluda County and in Lexington County
April 10, 1996 Notice of Federal Tax Liens against Roger Davenport for 1991 and 1992 Federal Income Taxes filed in Saluda County
June 10, 1996 Faith Davenport, purportedly, executes deed transferring property to Audio Investments for $10
1996 Notices of Intention to Levy for 1991, 1992, and 1993 taxes issued
October 27, Notice of Federal Tax Lien filed against 1997 Audio Investments for Roger Davenport's 1991, 1992, and 1993 federal income taxes
February 9, Service levies against assets of Roger 1998 Davenport
March 16, 1998 Service seizes property (mailing address of Route 2, Box 340-D, Leesville, South Carolina 29070)
April-May, 1998 Notices of Sale of property issued
May 29, 1998 Service sells property to Dewey L. Robertson, Sr. for $110,000.
May 29, 1998 Six-month period for redemption of property commences under 26 U.S.C. (I.R.C.) § 6338(a) commences
November 30, Six-month period for redemption of 1998 property expires (because November 29, 1998 fell on a Sunday)
December 7, Service issues deed for property to 1998 Dewey L. Robertson, Sr.
December 21, Deed from Service to Dewey Robertson, 1998 Sr., is recorded at Deed Book 427, page 332-335,
December 30, Addendum ("Additional Page") to Deed 1998 from Service to Dewey Robertson, Sr., recorded
September 23, Audio Investments, through counsel, Orin 1999 G. Briggs, issues summons to Dewey L. Robertson in quiet title action
October 4, 1999 Audio Investments, through counsel, Orin G. Briggs, formally files quiet title action in Court of Common Pleas for Saluda County (Case No. 99-CP-41-125)
October 7, 1999 Audio Investments, through counsel, Orin G. Briggs, files summons in Clerk of Court for Saluda County
November 4, Dewey Robertson, through counsel, 1999 James O. Spence, files amended answer with affirmative defenses
August or Counsel for Dewey Robertson formally September, files motion to add United States of 2000 America, by the through the Internal Revenue Service and Roger Davenport as parties to state court action
September 13, United States removes case to federal 2000 court
(Report and Recommendation in Civil Action No. 8:00-2847-20BG, at pages 1-6 [footnote omitted from quotation]).
As pointed out in footnote 11 of the Report and Recommendation filed on January 25, 2002, in Civil Action No. 8:00-2847-20BG, the property in question is located in Saluda County, although it has a "Leesville" mailing address. The "Leesville" mailing address, apparently, caused the Service to file the federal tax liens in Lexington County on October 22, 1995. In other words, the first tax liens were filed in the wrong county.
The former Town of Leesville (now part of Batesburg-Leesville) is located in Lexington County. But the "Leesville" mailing area includes western Lexington County (the Town of Summit and area west of Summit) and eastern Saluda County.
The confusion caused by a discrepancy between geographical location and mailing address is not limited to "Leesville." It can be judicially noticed that other portions of northeastern Saluda County have a "Prosperity" mailing address even though the Town of Prosperity is located in Newberry County.
Currently before this court in the above-captioned case (Civil Action No. 3:02-0183-20BG) are various motions: the motion to dismiss filed by counsel for Paul H. O'Neill, Carol Blount, and William J. Johnson (Document No. 9); the supplemental motion to substitute parties (Document No. 14); the plaintiff's demand for a jury trial (Document No. 7); a motion for recusal of magistrate judge (Document No. 17); and a motion to remand to state court (Document No. 21).
Roger O. Davenport, the plaintiff, is proceeding pro se and has been apprised of dispositive motion procedure. Roseboro v. Garrison, 528 F.2d 309, 310 (4th Cir. 1975) (district court must advise a plaintiff confronted by a dispositive motion from an adverse party of his or her right to file counter-affidavits or other responsive material, and be alerted to the fact that his or her failure to so respond might result in the entry of summary judgment against him or her). The Roseboro order in the above-captioned case was issued on January 28, 2002.
The Plaintiff's Motion to Remand The Defendant's Motion to Substitute Parties
The Plaintiff's motion to remand (Document No. 21) is styled as a "MOTION TO REMAND DUE TO FAILURE TO REMOVE IN TIMELY MANNER[.]" The plaintiff contends that the above-captioned case should be remanded because the case was not removed from state court within the thirty-day period of 28 U.S.C. § 1446(b).It is well-settled that a Notice of Removal must be filed by a defendant in a state court action within thirty days after the complaint in state court is served or within thirty days after the case becomes removable. See 28 U.S.C. § 1446; and Heniford v. American Motors Sales Corporation, 471 F. Supp. 328 (D.S.C. 1979), appeal dismissed, 622 F.2d 584 (4th Cir. 1980) [Table].
Counsel for the defendants in the Notice of Removal (Document No. 1) writes:
5. The documents comprising Exhibit 1 to this Notice were obtained by the Tax Division of the United States Department of Justice in Washington, D.C., by facsimile from the Internal Revenue Service. Upon information and belief, the Attorney General and the United States Attorney for the District of South Carolina has not been served with the documents comprising Exhibit I. The time for filing this Notice of Removal has not expired, pursuant to 28 U.S.C. § 1446(b).
(Notice of Removal, at page 2).
It is well-settled that, for an action commenced in federal district court, a plaintiff suing a federal official must served the federal official, the Attorney General of the United States, and the United States Attorney for the judicial district where the case was filed. Fed.R.Civ.P. 4(i) provides:
(i) Service Upon the United States, and Its Agencies, Corporations, or Officers.
(1) Service upon the United States shall be effected
(A) by delivering a copy of the summons and of the complaint to the United States attorney for the district in which the action is brought or to an assistant United States attorney or clerical employee designated by the United States attorney in a writing filed with the clerk of the court or by sending a copy of the summons and of the complaint by registered or certified mail addressed to the civil process clerk at the office of the United States attorney and
(B) by also sending a copy of the summons and of the complaint by registered or certified mail to the Attorney General of the United States at Washington, District of Columbia, and
(C) in any action attacking the validity of an order of an officer or agency of the United States not made a party, by also sending a copy of the summons and of the complaint by registered or certified mail to the officer or agency.
(2) Service upon an officer, agency, or corporation of the United States, shall be effected by serving the United States in the manner prescribed by paragraph (1) of this subdivision and by also sending a copy of the summons and of the complaint by registered or certified mail to the officer, agency, or corporation.
(3) The court shall allow a reasonable time for service of process under this subdivision for the purpose of curing the failure to serve multiple officers, agencies, or corporations of the United States if the plaintiff has effected service on either the United States attorney or the Attorney General of the United States.
(Rule 4(i) of the Federal Rules of Civil Procedure).
The above-captioned case was removed to federal court on January 18, 2002. The plaintiff filed his motion to remand (Document No. 21) on March 19, 2002. It is well-settled that motions to remand on the basis of improper removal must be filed within thirty days of the filing date of the Notice of Removal. See 28 U.S.C. § 1446(c) ("A motion to remand the case on the basis of any defect other than lack of subject matter jurisdiction must be made within 30 days after the filing of a notice of removal under section 1446(a)."); and Rankin v. Internal Revenue Service, 2001 U.S.Dist. LEXIS® 7597, 2001 WESTLAW® 1103231, 88 A.F.T.R.2d 2001-5627, 2002-1 U.S.T.C. ¶ 50,202 (M.D.Fla., June 22, 2001), which involved a challenge to federal tax liens. In other words, once the removal of this case was accomplished on January 18, 2002, the plaintiff was required to move to remand this case to state court within thirty days — to the extent that the plaintiff was claiming any defect in the process of removal. The plaintiff's motion to remand should be denied as untimely.
Generally, a case can be originally filed in a federal district court if there is diversity of citizenship under 28 U.S.C. § 1332 or there if there is so-called "federal question" jurisdiction under 28 U.S.C. § 1331. Federal courts are courts of limited jurisdiction, "constrained to exercise only the authority conferred by Article III of the Constitution and affirmatively granted by federal statute." In re Bulldog Trucking, Inc., 147 F.3d 347, 352, 1998 U.S.App. LEXIS® 13210 (4th Cir. 1998).
It is well-settled that the proper party in an income tax controversy in federal district court is the United States, not the Service or individual officials or employees of the Service. Deleeuw v. Internal Revenue Service, 681 F. Supp. 402, 1987 U.S.Dist. LEXIS® 13089 (E.D.Mich. 1987), where the district court commented:
The I.R.S. and agents Raby and Moore are not proper parties. An executive department of the United States or one of its agencies may only be sued in its own name if the authority to be sued has been expressly been conferred by Congress. Blackmar v. Guerre, 342 U.S. 512, 514-15, 72 S.Ct. 410, 411-12, 96 L.Ed. 534 (1952). Congress has not authorized the Treasury Department or any of its divisions or bureaus to be sued. Henry Vlietstra Plastering Acoustical Co. v. I.R.S., 401 F. Supp. 829, 832 (W.D.Mich. 1975). Relief sought against agents Raby and Moore is actually relief sought against the United States. Warner v. Reynolds, 54 A.F.T.R.2d 5698 [1984 U.S.Dist. LEXIS® 14785, 1984 WESTLAW® 3079] (S.D.lnd. 1984).
Deleeuw v. Internal Revenue Service, supra, 681 F. Supp. 402, 403-104. Cf. Castleberry v. Alcohol Tobacco and Firearms Division of the Treasury Dept. of the United States, 530 F.2d 672, 673 n. 3 (5th Cir. 1976). See also Warner v. Reynolds, 1984 U.S.Dist. LEXIS® 14785, 1984 WESTLAW® 3079, 54 A.F.T.R.2d 5698, 84-2 U.S.T.C. ¶ 9810 (S.D.Ind. 1984) ("First, the Court agrees with the government that the named defendants are improper parties and that the United States should be substituted therefor. It is the interest of the United States that is at stake in the issuances of the [IRS] summonses, and the authority of the United States underwhich they are issued."), which is cited in Deleeuw v. Internal Revenue Service, supra, 681 F. Supp. at 404. Hence, the defendants' motion to substitute parties (Document No. 14) is being granted in a separate order.
Insofar as Internal Revenue Service summonses are concerned, Deleeuw may have been superannuated by later case law. See Faber v. United States, 69 F. Supp.2d 965, 971, 1999 U.S.Dist. LEXIS® 9043 (W.D.Mich. 1999) (suggesting that Deleeuw may have been superannuated by Kondik v. United States, 81 F.3d 655, 1996 U.S.App. LEXIS® 8477 (6th Cir. 1996)).
In Rankin v. Internal Revenue Service, supra, 2001 WESTLAW® 1103231, the district court rejected a tax protester's "Notice of Non-Acceptance of Removal and Petition to Release Case Back to State Jurisdiction" in 2001:
* * * The issue of whether the court has subject matter jurisdiction and the issue of whether there is removal jurisdiction, however, involve separate considerations. With regard to removal jurisdiction the issue is simply whether there was a statutory basis granting the court the authority to assume jurisdiction to adjudicate the claims. There is no question that the removal statute expressly grants the United States and its agencies and officials the right to remove any civil or criminal claim filed against it notwithstanding whether the claim is one where there is original subject matter jurisdiction. [FN3] Thus, as to removal jurisdiction removal was proper and thus this Court was entitled to adjudicate the claims.
[FN3. See, Jefferson County v. Acker, 527 U.S. 423, 430 (1999) (removal proper in case against federal officer even though officer has immunity from suit.)]
As to subject matter jurisdiction, the Court has already concluded in its Report And Recommendation that Plaintiff's claims alleged in the Complaint cannot be prosecuted against the United States because the United States has not waived its sovereign immunity as to those claims. It follows that suit against the United States to discharge an obligation owed to the United States Treasury, even if prosecuted in state court, would be futile. The United States is immune from suit by Plaintiff on her claims whether the forum for adjudication is in the state court or whether the forum is in the federal court. It would, therefore, not be an efficient use of judicial resources to remand this case to state court, as requested by Plaintiff, rather than to dismiss the case and avoid a further waste of judicial resources. Accordingly, Plaintiff's belatedly filed request for remand is due to be denied.
Rankin v. Internal Revenue Service, supra, 2001 WESTLAW® 1103231, at *4-*5.
The plaintiff may be, implicitly, contending that he properly served the United States under the South Carolina Rules of Civil Procedure prior to the Notice of Removal. There is no indication that the United States was served properly under state court rules. See Maybin v. Northside Correctional Center, 891 F.2d 72, 1989 U.S.App. LEXIS® 18485 (4th Cir. 1989).
Had the plaintiff properly served the Secretary of the Treasury, the Attorney General of the United States, and the United States Attorney by Certified Mail (return receipt requested) under Rule 4(i), the thirty-day period for a timely removal would have begun to run. Since the plaintiff did not properly serve the Secretary of the Treasury, the Attorney General of the United States, and the United States Attorney for the District of South Carolina under Rule 4(i) or under South Carolina rules, the thirty-day period for a timely removal never began to run. Vinegar v. United States Marshal's Service, 1996 U.S.Dist. LEXIS® 22388, 1996 WESTLAW® 227860, *1-*2 (S.D.Cal., March 27, 1996) (holding that service of process upon federal defendants not properly effected prior to removal "[e]ven if § 416.50 [of the California Civil Procedure] does apply to the United States"). Accordingly, the plaintiff's motion to remand (Document No. 21) should be denied.
The Plaintiff's Motion for Recusal
On March 4, 2002, the plaintiff filed motion for recusal (Document No. 17) of the undersigned magistrate judge. In the motion and in a document styled by the plaintiff as an "AFFIDAVIT OF CAUSE NECESSITATING REMAND OF THE ABOVE CASE" (Document No. 18), the plaintiff reiterates his contentions from Civil Action No. 8:00-2847-20BG that the United States District Court for the District of South Carolina lacks subject matter jurisdiction over Civil Action No. 8:00-2847-20BG and well as the above-captioned case (Civil Action No. 3:02-0183-20BG). Ultimately, the plaintiff is contending that, because of the undersigned's Report and Recommendation in Civil Action No. 8:00-2847-20BG, the undersigned is biased toward the plaintiff.
It is well-settled that the judicial notice of a prior civil or criminal case is not a basis for recusal. Bolin v. Story, 225 F.3d 1234, 2000 U.S.App. LEXIS® 22501 (11th Cir. 2000) (knowledge from prior judicial proceeding not basis for recusal). Moreover, the plaintiff's lack of success with respect to his federal income tax matters results from his tax protester activities. As pointed out in the Report and Recommendation filed in Civil Action No. 8:00-2847-20BG on January 25, 2002, the lack of success by tax protesters is primarily caused by reliance on discredited or perverse legal reasoning: "The above-captioned case [Civil Action No. 8:00-2847-20BG] is illustrative of consequences (whether intended or unintended) resulting from the activities of self-deluded tax protesters." (Report and Recommendation in Civil Action No. 8:00-2847-208G, at page 2.)
See James Edward Maule, Instant Replay, Weak Teams, and Disputed Calls: An Empirical Study of Alleged Tax Court Judge Bias, 66 Tenn. L. Rev. 351 (Winter 1999), which is cited in footnote I of the Report and Recommendation in Civil Action No. 8:00-2847-20BG. Mr. Maule concluded that tax protesters tended to rely, to their detriment, on discredited arguments before the United States Tax Court:
* * * [E]xamination of the issues provides a rational, coherent, and sensible explanation for the overwhelming rate of IRS success. Essentially, to return to the sporting metaphors, trying to use these issues to evaluate the referee's impartiality is much like blaming the umpires of a pro-am softball series for the lopsided margins of victory posted by the almost undefeated professionals. Simply put, on these issues, the taxpayers are almost always out of their league. They take positions in direct conflict with the statute or regulations, they fail to introduce evidence, they fail to appear, they rely on boilerplate tax protester cliches, and they otherwise manifest a lack of understanding or comprehension of the demands of litigation.
Even though there was virtually no difference between the regular and memorandum decisions in terms of bias opportunity, there is a noticeable A difference between the taxpayers' 3% success rate in memorandum opinions and 24% success rate in regular opinions. The surprise is not so much the 3% rate but the 24% rate. There are several possible explanations for the difference, but the most striking is the ever-increasing number of prose taxpayer litigants, * * * particularly in cases that are the subject of a memorandum opinion. Ninth-inning heroics can be expected from some of the taxpayer attorneys arguing issues destined for resolution in a regular opinion but are hardly expected from pro se taxpayers, whose tax training and knowledge of legal processes pales in comparison both to the professionally educated Chief Counsel attorney representing the IRS and to the similarly educated, and probably more experienced, attorney representing taxpayers with genuinely pursued disputes. * * * The judges attempt to assist prose taxpayers because the absence of trained attorneys prevents some issues of first impression from being adequately argued and briefed. Many of the pro se taxpayers, however, either reject the help, as is the case with protesters, * * * or insist on proceeding in their own way despite the judge's suggestions. In contrast, the IRS does not, and has no reason to, engage in a practice of failing to appear in court, pursuing hopeless cases, and ignoring legal precedent.
Moreover, the plaintiff in Civil Action No. 8:00-2847-20BG filed numerous objections to the Report and Recommendation in Civil Action No. 8:00-2847-20BG. A magistrate judge makes only a recommendation, and the authority to make a final determination in the above-captioned case (Civil Action No. 3:02-0183-20BG) and in the plaintiff's prior case (Civil Action No. 8:00-2847-20BG) rests with the United States District Judge. See Mathews v. Weber, 423 U.S. 261, 270-271 (1976); and Estrada v. Witkowski, 816 F. Supp. 408, 410, 1993 U.S.Dist. LEXIS® 3411 (D.S.C. 1993). Hence, the plaintiff's right to file objections to a Report and Recommendation and right to appeal to the United States Court of Appeals for the Fourth Circuit provide the plaintiff an adequate judicial remedy. See In Re Evans, 801 F.2d 703, 705-708 (4th Cir. 1986); and In Re Sassower, 20 F.3d 42, 1994 U.S.App. LEXIS® 7027 (Judicial Council of 2nd Cir. 1994). Cf. In Re Beard, 811 F.2d 818, 826-827 (4th Cir. 1987) (petition for a writ of mandamus not a substitute for an appeal); In Re United Steelworkers of America, 595 F.2d 958, 960 (4th Cir. 1979); and Queen v. Leeke, 457 F. Supp. 476, 479 (D.S.C. 1978). Under Bolin v. Story, supra, the plaintiff's motion for recusal should be denied.
The United States' Motion to Dismiss
In the motion to dismiss (Document No. 9) and in the memorandum in support (Document No. 10), the United States points out that the above-captioned case is essentially a repetitive suit to Civil Action No. 8:00-2847-20BG. As pointed out earlier, this court may take judicial notice of Civil Action No. 8:00-2847-20BG. Aloe Creme Laboratories, Inc. v. Francine Co., supra, 425 F.2d at 1296.
The plaintiff's claims concerning the validity of the tax liens has already been addressed in Civil Action No. 8:00-2847-20BG by the undersigned's Report and Recommendation filed on January 25, 2002:
It is noteworthy that the contentions raised by Roger Davenport are being raised in the above-captioned case, which was filed after the Service assessed and collected the taxes due for Calendar Years 1991-1993. The above-captioned case is actually an attempt by Roger Davenport to effect an "end-run" against the Anti-Injunction Act. In other words, Roger Davenport, Margaret Davenport, Faith Davenport, and Audio Investments could not have stopped the assessment or collection of the taxes due when the Service was actually assessing and collecting the taxes.
Closely on point are cases interpreting the Anti-Injunction Act and cases on the sovereign immunity of the United States. The United States cannot be sued without its express consent, and express consent is a prerequisite to a suit against the United States. United States v. Mitchell, 463 U.S. 206, 212 (1983). The bar of sovereign immunity cannot be avoided by naming officers or employees as defendants. Gilbert v. Da Grossa, 756 F.2d 1455, 1458, 1985 U.S.App. LEXIS® 29914 (9th Cir. 1985). Cf. Hawaii v. Gordon, 373 U.S. 57, 58 (1963). Similarly, the bar of sovereign immunity cannot be avoided by the filing of a suit against a federal agency or a federal department, such as the Internal Revenue Service. See Campbell v. United States, 496 F. Supp. 36, 37-38 n. * (E.D.Tenn. 1980).
Title 26 U.S.C. (I.R.C.) § 7421(a) provides that, unless certain exceptions are applicable:
[N]o suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person[.]
The United States Court of Appeals for the Fourth Circuit has held that, if there is no express provision for an exception in the Anti-Injunction Act itself, a lower federal court may not create an exception. See Clark v. Baker (In re Heritage Church and Missionary Fellowship), 851 F.2d 104, 105-106, 1998 U.S.App. LEXIS® 5466 (4th Cir. 1988) (the "PTL" bankruptcy case). * * *
The Supreme Court of the United States has indicated that the purpose of the Anti-Injunction Act is "the protection of the Government's need to assess and collect taxes as expeditiously as possible with a minimum of preenforcement judicial interference, 'and to require that the legal right to the disputed sums be determined in suit for a refund.'" Bob Jones University v. Simon, 416 U.S. 725, 736 (1974). * * * See also Rochefort v. Gibbs, 696 F. Supp. 1151, 1152-1153, 1988 U.S.Dist. LEXIS® 11515 (W.D.Mich. 1988).
The Supreme Court of the United States has judicially created a limited exception to the Anti-Injunction Act. See Enochs v. Williams Packing Navigation Co., 370 U.S. 1, 7 (1962). * * * In order to establish a claim for injunctive relief under the holding in Enochs v. Williams Packing Navigation Co., the taxpayer must show: (1) under the most liberal view of the applicable laws and facts, it is clear that the government cannot prevail on the merits; and (2) absent an injunction, irreparable injuries will occur for which there is no adequate remedy at law. 370 U.S. at 6-7. Unless both of these prerequisites are met, "a suit for preventive injunctive relief must be dismissed." United States v. American Friends Service Committee, 419 U.S. 7, 10 (1974).
As to the second prerequisite, Roger Davenport had adequate remedies at law. All United States Court of Appeals have held that the right of a taxpayer to petition the Tax Court and his or her right, in the alternative, to pay the tax and then sue for a refund (in a federal district court) are adequate remedies at law. See, e.g., Cool Fuel, Inc. v. Connett, 685 F.2d 309, 313-314 n. 1 (9th Cir. 1982) (denying injunction, even though the Service failed to mail notice of deficiency to the taxpayer's last known address, because the taxpayer did not establish that it had no adequate remedy at law, or that irreparable injury would result from the denial of the injunction). Roger Davenport could have petitioned the Tax Court. Roger Davenport could have filed timely federal income tax returns, paid his taxes, and then started administrative, and, if necessary, judicial proceedings in a federal district court to recover a refund.
Moreover, the Declaratory Judgment Act would not give Roger Davenport the protection of its provisions because there is an exception with "respect to Federal taxes." 28 U.S.C. § 2201(a). "The Declaratory Judgment Act's tax exception, and the Anti-Injunction Act, work together to insure that preemptive taxpayer litigation will not frustrate the efforts of the Internal Revenue Service (the "IRS") to assess and collect federal taxes." Spencer v. Brady, 700 F. Supp. 601, 602, 1988 U.S.Dist. LEXIS® 14019 (D.D.C. 1988). See also American Society of Association Executives v. Bentsen, 848 F. Supp. 245, 247-250, 1994 U.S.Dist. LEXIS® 4819 (D.D.C. 1994).
The Anti-Injunction Act would not have allowed a federal district court to restrain the assessment or collection of the disputed taxes in this case — which obviously has been Roger Davenport's ultimate goal since 1992. Furthermore, Roger Davenport has not shown that any of the statutory or judicially created exceptions to the Anti-Injunction Act are applicable. Roger Davenport had adequate remedies at law, even though the documentary evidence shows that he refused to avail himself of those remedies[.]
In cases filed by tax protesters against the Internal Revenue Service, employees or officials, federal courts have rejected similar contentions raised by Roger Davenport in the case at bar. See, e.g., Stonecipher v. Bray, 653 F.2d 398 (9th Cir. 1981), cert. denied, 454 U.S. 1145 (1982); and Wise v. Commissioner of I.R.S., 624 F. Supp. 1124, 1986 U.S.Dist. LEXIS® 30650 (D.Mont. 1986). Also, the characterization of this case as a civil action and its being filed originally in state court would not defeat the applicability of the Anti-Injunction Act. See Sato v. Peterson, 1995 U.S.Dist. LEXIS® 10093, *21-*25 (N.D.lll., July 18, 1995) (magistrate judge's Report and Recommendation), adopted, 1995 WESTLAW® 591460 (N.D.lll., October 4, 1995).
Significantly, neither Roger Davenport nor Audio Investments sought to utilize the six-month redemption period set forth in 26 U.S.C. (I.R.C.) §§ 6337- 6339, which commenced on May 29, 1999. * * *
Moreover, Roger Davenport and Audio Investments cannot use 26 U.S.C. (I.R.C.) § 7433 to challenge the assessment of federal income taxes. See Granse v. United States, 932 F. Supp. 1162, 1996 U.S. Dist. LEXIS® 8613 (D.Minn. 1996), affirmed, Granse v. U.S. Department of the Treasury, 112 F.3d 513, 1997 U.S. App. LEXIS® 9343, 1997 WESTLAW® 215330 (8th Cir., May 1, 1997), which concerned a tax protester's attempt to challenge the sale of real estate[.] * * *
Hence, since Roger Davenport and Audio Investments did not seek to redeem the property under 26 U.S.C. § 6337-6339 during the automatic six-month period following the sale, their claims fail in the above-captioned case. Moreover, there is no indication that Roger Davenport ever timely filed an administrative claim for a refund as to the monies collected by virtue of the sale of the property. * * *
The failure of Roger Davenport, other Davenport family members, and Audio Investments to redeem the property within the six month period caused title to pass to Dewey Robertson, Sr., on December 7, 1998. Babb v. Lindvig, 947 F. Supp. 405, 409, 1998 U.S. Dist. LEXIS® 18093 (W.D.Wis. 1996) ("Section 6338 does not vest title in the tax sale purchaser until the period of redemption has expired; therefore redemption does not take title away from the tax sale purchaser."). Indeed, Section 6339(b)(2) states explicitly that a deed operates as "a conveyance of all the right, title, and interest the party delinquent had in and to the real property thus sold at the time the lien of the United States attached thereto." In other words, the issuance of the deed on December 7, 1998, by the Service conveyed title in the property in question to Dewey Robertson, Sr. See Babb v. Lindvig, supra, 947 F. Supp. at 408-410; and 26 U.S.C. (I.R.C.) § 6339[.] * * *
In short, despite the tax protester activities of Roger Davenport and the assistance provided to Roger Davenport by Faith Davenport and Audio Investments, the property in question still could have been redeemed for payment of the taxes plus interest during the six months after the tax sale. Babb v. Lindvig, supra. The issuance of the deed by the Service on December 7, 1998, passed title to Dewey Robertson, Sr. As a result, Roger Davenport, Margaret Davenport, Faith Davenport, and Audio Investments are entitled to any relief regarding the sale of the property in question. Traver v. Weisberg, 1994 U.S.Dist. LEXIS® 15191, 1994 WESTLAW® 578467 (D.Ore., October 18, 1994) (denying relief similar to that requested by Audio Investments and Roger Davenport in this case), appeal dismissed, in part, 73 F.3d 370, 1995 U.S.App. LEXIS® 38195, 1995 WESTLAW® 762161 (9th Cir., December 27, 1995), summary judgment granted, Traver v. United States, 1997 U.S.Dist. LEXIS® 3873 (D.Ore., March 17, 1997).
In light of the availability of the redemption process, Roger Davenport's medical exhibits concerning his prostate cancer in 1993 provide no basis for relief in the above-captioned case. Roger Davenport's prostate cancer did not prevent him from executing the deed of September 23, 1993, to Faith Davenport. Roger Davenport's "'prostate cancer' defense" appears to be premised on an invalid deduction of fact, which is best articulated in the maxim "Post hoc, ergo propter hoc." This maxim is usually translated as "After this, therefore, on account of this." Most federal courts have rejected the validity of that maxim in determining whether a causal connection exists. See, e.g., the order of the Honorable Charles E. Simons, Jr., United States District Judge, in Orr v. Gardner, 261 F. Supp. 39, 41 n. 1 (D.S.C. 1966) ("Post hoc, ergo propter hoc in logic is usually intended as 'the fallacy of arguing from mere temporal sequence to cause and effect relationship.'"); and Loyd v. Bullhead City, 931 F.2d 897 [Table], 1991 U.S.App. LEXIS® 9824, *17, 1991 WESTLAW® 70735 (9th Cir., May 6, 1991), where the United States Court of Appeals for the Ninth Circuit commented: "Loyd's argument presents a classic example of the logical fallacy known as post hoc, ergo propter hoc, i.e., that a cause-and-effect relationship can be shown from a mere temporal sequence. Although a district court, when evaluating a pleading under 28 U.S.C. § 1915, must assume that the allegations in the pleading are true, a district court is not required to accept unwarranted deductions of fact. See Gersten v. Rundle, 833 F. Supp. 906, 910, 1993 U.S.Dist. LEXIS® 13589 (S.D.Fla. 1993); and Clegg v. Cult Awareness Network, 18 F.3d 752, 754-755, 1994 U.S.App. LEXIS® 4103 (9th Cir. 1994) (district court not required to accept conclusions that cannot be reasonably drawn from facts alleged). See also Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987) (district court "not required to 'accept as true legal conclusions or unwarranted factual inferences'"); Bender v. Suburban Hospital, Inc., 159 F.3d 186, 192, 1998 U.S.App. LEXIS® 27790 (4th Cir. 1998); and cf. Papasan v. Allain, 478 U.S. 265, 286 (1986) ("Although for the purposes of this motion to dismiss we must take all the factual allegations in the complaint as true, we are not bound to accept as true a legal conclusion couched as a factual allegation.").
In his affidavit (Document No. 92), Roger Davenport appears to be contending that the undersigned United States Magistrate Judge has no jurisdiction over this matter. Under the Local Civil Rules of this district court, prose cases are referred to a United States Magistrate Judge. See Local Civil Rule 73.02(b)(2)(e). Moreover, as pointed out on the last page of this Report and Recommendation, the final decision in this matter will be made by a United States District Judge. See Mathews v. Weber, 423 U.S. 261, 270-271 (1976); and Estrada v. Witkowski, 816 F. Supp. 408, 410, 1993 U.S.Dist. LEXIS® 3411 (D.S.C. 1993).
Roger Davenport even contends, in his affidavit filed on January 23, 2002 (Document No. 93), that the United States District Court for the District of South Carolina lacks jurisdiction over this case. Section § 1346 of Title 28, United States Code, specifically, gives the federal district courts jurisdiction over cases where the United States is a defendant. Moreover, the above-captioned case is also clearly within the scope of 28 U.S.C. § 1346(a)(1).
Roger Davenport's reliance on Jack Cole Co. v. MacFarland, 206 Tenn. 694, 10 McCanless 694, 337 S.W.2d 453 (1960), is misplaced. See Roger Davenport's Affidavit (Document No. 84). At the time Jack Cole Co. v. MacFarland was decided, Tennessee's Constitution prohibited a tax on income. See "old" Article II, Section 28 of the Constitution of Tennessee, which was amended in 1973. Secondly, Jack Cole Co. v. MacFarland is not relevant on the issue of federal income taxes.
Roger Davenport's attention is directed to 26 U.S.C. (I.R.C.) § 61. See also United States v. Koliboski, 732 F.2d 1328, 1984 U.S.App. LEXIS® 23214 (7th Cir. 1984):
Although not raised in his brief on appeal, the defendant's entire case at trial rested on his claim that he in good faith believed that wages are not income for taxation purposes. Whatever his mental state, he, of course, was wrong, as all of us already are aware. Nonetheless, the defendant still insists that no case holds that wages are income. Let us now put that to rest: WAGES ARE INCOME. Any reading of tax cases by would-be tax protesters now should preclude a claim of good-faith belief that wages — or salaries — are not taxable.
United States v. Koliboski, supra, 732 F.2d at 1330 n. 1. Hence, it was not necessary for the Service to respond to Roger Davenport's delaying tactics, which are mentioned on page 2 of his affidavit (Document No. 84), "for information establishing him [Roger Davenport] liable under the Law." See also Roger Davenport's affidavit filed on January 23, 2002 (Document No. 93), wherein he describes himself as a person "who at the time of ownership transfer * * * was not liable for any income taxes[.]" (Document No. 93, at page 3).
Roger Davenport, according to Government's Exhibit 1 (to Document No. 79), had the following amounts of adjusted gross income over the tax years in question:
Tax Year Adjusted Gross Income 1991 $122,602.00 1992 $127,384.00 1993 $54,077.00
It strains credulity to believe that an individual (or couple) with adjusted gross income exceeding $100,000.00 would not owe any federal income tax. Gersten v. Rundle, supra, 833 F. Supp. at 910 (although a district court, when evaluating a pleading under 28 U.S.C. § 1915, must assume that the allegations in the pleading are true, a district court is not required to accept unwarranted deductions of fact).
The undersigned does not agree with the Service's characterization of Audio Investments as Roger Davenport's alter ago. This conclusion, however, is not fatal to the United States' motion for summary judgment because the fraudulent conveyances to Faith Davenport in 1993 and 1994 are the dispositive transactions at issue, not the 1996 conveyance to Audio Investments. In any event, Audio Investments is a sham trust. William L. Corner Family Equity Trust v. United States, supra. Moreover, the 1993 and 1994 conveyances to Faith Davenport are in Audio Investments' purported chain of title.
* * *
The failure to file tax returns by Roger Davenport and Margaret Davenport (irrespective of whether Margaret Davenport was required to file an income tax return) disqualifies them from the "safe harbors" of 26 U.S.C. § 6901 because the commencement of the limitations period is triggered by the filing of a return. In other words, the "safe harbor" for a transferee of a transferee set forth in 26 U.S.C. § 6901(c)(2) is not available to Audio Investments because the limitations period never began to run as to Roger Davenport and Margaret Davenport by virtue of their failure to file federal income tax returns for 1991, 1992, and 1993. See 26 U.S.C. (I.R.C.) § 6501(c)(3) ("In the case of failure to file a return, the tax may be assessed, or a proceeding in court for the collection of such tax may be begun without assessment, at any time."). Also, the substitute returns made by the Service under 26 U.S.C. § 6020(b) did not cause the limitations period to begin running. See 26 U.S.C. § 6501(b)(3). Moreover, it is well settled that "[s]ervice of notice of levy need not be made upon potential third party owners of levied-upon property to satisfy the notice provisions of the federal tax law." William L. Corner Family Equity Trust v. United States, supra, 732 F. Supp. at 760, citing Douglas v. United States, 562 F. Supp. 593, 1983 U.S.Dist. LEXIS® 19948 (S.D.Ga. 1983).
It is not clear from the record why Audio Investments and Margaret Davenport did not commence an action under 26 U.S.C. (I.R.C.) § 7426, which provides:
§ 7426. Civil actions by persons other than taxpayers
(a) Actions permitted. —
(1) Wrongful levy. — If a levy has been made on property or property has been sold pursuant to a levy, any person (other than the person against whom is assessed the tax out of which such levy arose) who claims an interest in or lien on such property and that such property was wrongfully levied upon may bring a civil action against the United States in a district court of the United States. Such action may be brought without regard to whether such property has been surrendered to or sold by the Secretary.
26 U.S.C. § 7426(a)(1). Federal district courts have jurisdiction over such cases. New Fairview, Inc. v. United States, 2001 U.S.Dist. LEXIS® 11437, 2001 WESTLAW® 953799, 88 A.F.T.R.2d 2001-5398, 2001-2 U.S.T.C. ¶ 50,756 (D.Mass., May 9, 2001).
* * *
Since the record shows no formal request by Margaret Davenport or Audio Investments under 26 U.S.C. (I.R.C.) § 6343(b), * * * the nine-month limitations period was not extended. The levy took place on February 9, 1998, and the seizure occurred on March 16, 1998. Audio Investments and Margaret Davenport had until November 9, 1998, to bring suit under 26 U.S.C. § 7426. Courts have held that the nine-month limitations period in 26 U.S.C. § 6532(c) is jurisdictional. See Becton Dickinson and Company v. Wolckenhauer, 215 F.3d 340, 343-354, 2000 U.S.App. LEXIS® 12455 (3rd Cir. 2000), cert. denied, Becton Dickinson and Co. v. Internal Revenue Service, 531 U.S. 1071, 148 L.Ed.2d 663, 121 S.Ct. 761, [2001] U.S. LEXIS® 143 (2001). See also BSC Term of Years Trust v. United States, 2000 U.S.Dist. LEXIS® 20058, 2000 WESTLAW® 33155870, 87 A.F.T.R.2d 2001-546, 2001-1 U.S.T.C. ¶ 50,174 (W.D.Texas, December 28, 2000) (untimely suits by family trusts).
As a result, notwithstanding the matter mentioned in footnote 7 of this Report and Recommendation, Margaret Davenport's failure to bring suit within nine months of February 9, 1998, precludes her from obtaining title to her former half-interest in the property in this civil action. Becton Dickinson and Company v. Wolckenhauer, supra, 215 F.3d at 343-354.
(Report and Recommendation in Civil Action No. 8:00-2847-20BG, at pages 26-53 [footnotes omitted from quotation]).
The case record in Civil Action No. 8:00-2847-20BG reveals that the plaintiff lost his home because of his actions as a tax protester and his refusal to avail himself of numerous lawful procedures to contest his federal income tax liability, such as the filing of a tax court petition. Cf. David McCord, Imagining a Retributivist Alternative to Capital Punishment, 50 Fla. Law Rev. 1 (January 1998) ("A well-known 'oldies' tune has a convict lamenting, 'Breakin' rocks in the hot sun; I fought the law and the law won.'"), which is citing a song originally popular in 1965. See The Bobby Fuller Four, I Fought the Law (El Paso Version) on El Paso Rock: Early Recordings Vol. I (Norton Records 1996). The song is also available from Del-Fi Records in another "oldies" compilation, Bobby Fuller, I Fought the Law, on Shakedown! The Texas Tapes Revisited (Del-Fi Records 1996), which is cited in L. Kevin Levine, Digital Music Distribution via the Internet: Is it a "Platinum" Idea or a "One Hit Wonder?", 104 W. Va. L. Rev. 209 (Fall 2001).
As pointed out on pages 15-16 of the Report and Recommendation in Civil Action No. 8:00-2847-20BG, although the various transactions initiated by Roger Davenport will not protect his tax protester activities in a civil action, Roger Davenport does have one consolation: it appears that the six-year limitations period for a criminal case, such as under 18 U.S.C. § 371 (conspiracy to defraud the United States) or other statutes, against him has expired. 26 U.S.C. § 6501. I.e., Roger Davenport will not go to prison for his fraudulent conveyance in 1993.
The plaintiff is reminded that the United States has criminally prosecuted tax protesters who have filed fraudulent liens against federal officials and employees. See United States v. Bostian, 59 F.3d 474, 476-480, 1995 U.S.App. LEXIS® 17250 (4th Cir. 1995), cert. denied, Bostian v. United States, 516 U.S. 1121, 133 L.Ed.2d 857, 116 S.Ct. 929, 1996 U.S. LEXIS® 1076 (1996); and United States v. MacElvain, 858 F. Supp. 1096, 1100, 1994 U.S. Dist. LEXIS® 6062 (M.D.Ala. 1994) ("The filing of such frivolous documents imposes irreparable harm on the individuals and entities that are the victims of the liens."), affirmed, 68 F.3d 486, 1995 U.S.App. LEXIS® 27683 (11th Cir. 1995). The rationale of the tax protester cases indicates that United States District Courts must be vigilant in preventing the filing of fraudulent liens and other documents by tax protesters. See United States v. Reeves, 782 F.2d 1323 (5th Cir.), cert. denied, Reeves v. United States, 479 U.S. 837 (1986).
The plaintiff's claims concerning the computation of the income taxes owed, the validity of tax liens, and the assessment and collection of the taxes owed by the plaintiff were addressed by the undersigned in Civil Action No. 8:00-2847-208G. See Aloe Creme Laboratories, Inc. v. Francine Co., supra, where the United States Court of Appeals for the Fifth Circuit commented:
The District Court clearly had the right to take notice of its own files and records and it had no duty to grind the same corn a second time. Once was sufficient.
Aloe Creme Laboratories, Inc. v. Francine Co., supra, 425 F.2d at 1296.
The Plaintiff's Request for a Trial by Jury
In his jury demand (Document No. 7), the plaintiff seeks a jury trial. In its opposition (Document No. 13), the United States contends that "Plaintiff is not entitled to a jury trial because this action does not meet the jurisdictional requirements of 28 U.S.C. Sect. 2402 as it is not an action against the United States pursuant to section 1346(a)(1)."
Since the undersigned is recommending that the Motion to Dismiss (Document No. 9) be granted, the plaintiff's demand for a jury trial is moot. See United States v. Trowbridge, 1993 U.S.Dist. LEXIS® 13254, 1993 WESTLAW® 764338 (D.Idaho, September 13, 1993) ("As a result of the Court's recommendation above that Plaintiff's motion for summary judgment and motion for declaratory judgment be granted, Defendant Brians' demand for jury trial and demand for individual hearings, both filed May 11, 1993, are thereby rendered MOOT."), which was a tax protester case.
Moreover, since the tax sale of the property in question was actually an action in equity, not in law, a jury trial is not required. See United States v. Wright, 1994 U.S.Dist. LEXIS® 16361, 1994 WESTLAW® 715870, 74 A.F.T.R.2d 7042, 94-2 U.S.T.C. ¶ 50,599 (E.D.Cal., October 25, 1994) (denying jury demand by tax protesters), affirmed, United States v. Wright, 87 F.3d 1325, 1996 U.S.App. LEXIS® 16534, 1996 WESTLAW® 329604 (9th Cir. 1996), cert. denied, Wright v. United States, 520 U.S. 1187, 1997 U.S. LEXIS® 2567 (1997):
As pointed out in footnote 12 of the Report and Recommendation in Civil Action No. 8:00-2847-20BG, taxpayers who want a jury trial can pay the disputed tax, file an administrative claim for a refund, and (if the administrative claim for a refund is denied) sue for a refund in federal district court:
Section 6213(a) is no mere technicality. Prior to establishment in the mid-1920's of the Board of Tax Appeals (now the Tax Court), one could litigate a tax assessment only by paying the tax and suing for a refund in a district court or the Court of Claims (now the U.S. Claims Court). With the advent of the Board of Tax Appeals, one could litigate without paying. The keystone of the new system was a restraint on assessment until the taxpayer's right to petition the Board was exercised or waived or lapsed, and, thereafter, if the right was exercised, while litigation was proceeding. Violation of the rule by the Service was made one of the few exceptions to the Anti-Injunction statute now found in section 7421. Taxpayers retain the right to pay the tax and litigate in a federal district court or the Claims Court, but, not surprisingly, the vast majority of litigated cases (80 to 90 percent) follow the Tax Court route.
Charles S. Lyon, Disclosure of Grand Jury Materials: Why the Supreme Court Was Wrong in Baggot, 39 Tax Law Review 215, 216-217 (1984).
Plaintiff also moves to strike Wright's jury demand. Since Wright does not specify which issues he wants tried by jury, he is deemed to have demanded trial by jury for all the issues so triable. See Fed.R.Civ.P. 38(c). In its motion, plaintiff argues that a trial by jury is improper for both claims contained in its second cause of action. In that cause of action, plaintiff seeks to foreclose its tax liens on the property at issue as well as set aside fraudulent conveyances.
The Seventh Amendment provides that "[i]n suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved". U.S. Const. amend. VII. This guarantee of a jury trial extends to actions that were similar to those tried in 18th-century courts of law, as opposed to those tried in courts of equity. See Tull v. United States, 481 U.S. 412, 417 (1987). To determine whether an action gives rise to a right to jury trial, courts first examine the nature of the action and compare it to 18th century actions brought in English courts prior to the merger of the courts of law and equity. Second, courts assess the remedy sought and determine whether it is legal or equitable in nature. Id. The second inquiry is more important than the first. Id. at 421.
Under this approach, no right to a jury trial exists in an action to foreclose tax liens. This is so because such an action is equitable in nature. United States v. Annis [80-2 USTC ¶ 9801], 634 F.2d 1270, 1272 (10th Cir. 1980). There being no right to jury trial for equitable actions, plaintiff's motion to strike the jury demand for the claim to foreclose its tax lien is granted.
United States v. Wright, supra, 1994 WESTLAW® 715870, at *5-*6.
United States v. Wright has been superannuated on unrelated grounds: the claim extinguishment provisions of California's Uniform Fraudulent Transfer Act (CUFTA). See Bresson v. Commissioner, 213 F.3d 1173, 2000 U.S.App. LEXIS® 11948 (9th Cir. 2000).
Recommendation
Accordingly, I recommend that the District Court grant the Motion to Dismiss filed by the United States (Document No. 9) and that the District Court dismiss with case with prejudice. It is also recommended that the plaintiff's plaintiff's demand for a jury trial (Document No. 7), motion for recusal of magistrate judge (Document No. 17), and motion to remand case to state court (Document No. 21) be denied. The parties' attention is directed to the notice on the next page.Notice of Right to File Objections to Magistrate Judge's "Report and Recommendation" The Serious Consequences of a Failure to Do So
The parties are hereby notified that any objections to the attached Report and Recommendation (or Order and Recommendation) must be filed within ten (10) days of the date of its filing. 28 U.S.C. § 636 and Fed.R.Civ.P. 72(b). The time calculation of this ten-day period excludes weekends and holidays and provides for an additional three days for filing by mail. Fed.R.Civ.P. 6. Based thereon, this Report and Recommendation, any objections thereto, and the case file will be delivered to a united States District Judge fourteen (14) days after this Report and Recommendation is filed. Advance coating Technology, Inc. v. LEP Chemical, Ltd., 142 F.R.D. 91, 94 n. 3, 1992 U.S.Dist. LEXIS® 6243 (S.D.N.Y. 1992). A magistrate judge makes only a recommendation, and the authority to make a final determination in this case rests with the United States District Judge. See Mathews v. Weber, 423 U.S. 261, 270-271 (1976); and Estrada v. Witkowski, 816 F. Supp. 408, 410, 1993 U.S.Dist. LEXIS® 3411 (D.S.C. 1993).
During the ten-day period, but not thereafter, a party must file with the clerk of court specific, written objections to the Report and Recommendation, if he or she wishes the United States District Judge to consider any objections. Any written objections must specifically identify the portions of the Report and Recommendation to which objections are made and the basis for such objections. See Keeler v. Pea, 782 F. Supp. 42, 43-44, 1992 U.S.Dist. LEXIS® 8250 (D.S.C. 1992); and Oliverson v. West Valley City, 875 F. Supp. 1465, 1467, 1995 U.S.Dist. LEXIS® 776 (D.Utah 1995). Failure to file specific, written objections shall constitute a waiver of a party's right to further judicial review, including appellate review, if the recommendation is accepted by the United States District Judge. See United States v. Schronce, 727 F.2d 91, 94 n. 4 (4th Cir.), cert. denied, Schronce v. United States, 467 U.S. 1208 (1984); and Wright v. Collins, 766 F.2d 841, 845-847 nn. 1-3 (4th Cir. 1985). Moreover, if a party files specific objections to a portion of a magistrate judge's Report and Recommendation, but does not file specific objections to other portions of the Report and Recommendation, that party waives appellate review of the portions of the magistrate judge's Report and Recommendation to which he or she did not object. In other words, a party's failure to object to one issue in a magistrate judge's Report and Recommendation precludes that party from subsequently raising that issue on appeal, even if objections are filed on other issues. Howard v. Secretary of HHS, 932 F.2d 505, 508-509, 1991 U.S.App. LEXIS® 8487 (6th Cir. 1991). See also Praylow v. Martin, 761 F.2d 179, 180 n. 1 (4th Cir.) (party precluded from raising on appeal factual issue to which it did not object in the district court), cert. denied, 474 U.S. 1009 (1985). In Howard, supra, the court stated that general, non-specific objections are not sufficient:
A general objection to the entirety of the [magistrate judge's] report has the same effects as would a failure to object. The district court's attention is not focused on any specific issues for review, thereby making the initial reference to the [magistrate judge] useless. * * * This duplication of time and effort wastes judicial resources rather than saving them, end runs contrary to the purposes of the Magistrates Act. * * * We would hardly countenance an appellant's brief simply objecting to the district court's determination without explaining the source of the error.
Accord Lockert v. Faulkner, 843 F.2d 1015, 1017-1019 (7th Cir. 1988), where the Court held that the appellant, who proceeded prose in the district court, was barred from raising issues on appeal that he did not specifically raise in his objections to the district court:
Just as a complaint stating only "I complain' states no claim, an objection stating only 'I object' preserves no issue for review. * * * A district judge should not have to guess what arguments an objecting party depends on when reviewing a [magistrate judge's] report.
See also Branch v. Martin, 886 F.2d 1043, 1046, 1989 U.S.App. LEXIS® 15,084 (8th Cir. 1989) ("no de novo review if objections are untimely or general"), which involved a pro se litigant; and Goney v. Clark, 749 F.2d 5, 7 n. 1 (3rd Cir. 1984) ("plaintiff's objections lacked the specificity to trigger do novo review"). This notice, hereby, apprises the parties of the consequences of a failure to file specific, written objections. See Wright v. Collins, supra and Small v. Secretary of HHS, 892 F.2d 15, 16, 1989 U.S.App. LEXIS® 19,302 (2nd Cir. 1989). Filing by mail pursuant to Fed.R.Civ.P. 5 may be accomplished by mailing objections addressed as follows: