Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_02-cv-05141/USCOURTS-caed-1_02-cv-05141-3/pdf.json

Nature of Suit Code: 870
Nature of Suit: Tax Suits
Cause of Action: 26:7403 Suit to Enforce Federal Tax Lien

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IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA, )

)

)

)

Plaintiff, )

)

vs. )

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JAMES LITTLE, et al., )

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Defendant. )

)

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No. CV-F-02-5141 REC/DLB

ORDER DENYING DEFENDANTS

JAMES AND LORNA LITTLE'S

MOTION TO DISMISS (Docs.

102, 103, 104, 105, 106 &

116) 

On August 29, 2005, the court heard the motion to dismiss

filed by James and Lorna Little. 

Upon due consideration of the record and the arguments of

the parties, the court denies this motion for the reasons set

forth herein.

The United States has filed an action against James and

Lorna Little to reduce to judgment federal income tax assessments

against the Littles and to foreclose related tax liens against

them on real property located in Tulare County. 

On March 11, 2005, the Littles, who are proceeding in pro

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per, filed a motion to dismiss this action because of the

“absence of any proof of a cession of territory within the state

of California at Lemon Cove where Defendants live.” On June 9,

2005, the Littles filed an “Amendment” to their motion to dismiss

adding several grounds for dismissal of the First Amended

Complaint. At oral argument on August 29, 2005, the Littles

filed a “Statement for the Court”. 

In February 2004, the Littles filed a Motion to Compel

Answers to Discovery Requests and Production of Documents or To

Dismiss. By Order filed on April 12, 2004, the court denied this

motion without oral argument, the court concluding that the

motion was frivolous as a matter of law. The court ruled in

pertinent part:

The Littles argue that the discovery sought

by the attached interrogatories and requests

for production of documents is relevant and

reasonably calculated to lead to discovery of

admissible evidence that the United States

has never obtained the requisite notice of

acceptance of jurisdiction and exclusive

legislative jurisdiction over the land on

which this federal courthouse stands or the

land owned by the Littles in Tulare County. 

The Littles contend that Article I, Section

8, subparagraph 17 of the United States

Constitution and 40 U.S.C. § 255 “strictly

limits the FEDERAL LEGISLATIVE JURISDICTION

OF THE UNITED STATES WITHIN STATE BOUNDARIES

TO ‘TERRITORIES, ‘ENCLAVES’, ‘FEDERAL AREAS’

WHICH HAVE BEEN CEDED BY THE LEGISLATURE OF

THE GIVEN STATE, WHICH CESSION MUST HAVE BEEN

ACCEPTED AS REQUIRED BY FEDERAL AND STATE LAW

UNDER TITLE, 40 SECTION 255.”

There is no question that this court has

authority by statute to hear this case. The

jurisdiction of the United States District

Courts to hear suits to enforce the federal

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income tax laws against the Littles is not

dependent on whether the State of California

or the United States owns the land on which

this federal courthouse is located. 

Furthermore, the jurisdiction of the United

States to enforce federal tax liens by

foreclosure of lands located within a state

is not dependent upon those lands being in a

federal enclave. Article I, Section 8,

subparagraph 17 of the United States

Constitution provides for congressional

legislative power over the District of

Columbia and federal enclaves. This section,

however, does not bar the federal government

from enforcing the federal tax laws by

foreclosing a tax lien on property outside of

the national capital or federal enclaves. 

Article I, Section 8, subparagraph 1 of the

United States Constitution explicitly

provides the federal government with the

power to lay and collect taxes. This is an

independent power which is not limited by the

other specific powers enumerated in Section

8. See United States v. Butler, 297 U.S. 1,

65-66 (1936); In re Becraft, 885 F.2d 547,

548 n.2 (9 Cir. 1989); United States v. th

Sato, 704 F.Supp. 816, 818 (N.D.Ill. 1989). 

The Littles’ reliance on Section 255 is

equally unavailing. Section 255 has no

relevance to the ability of the federal

government to enforce the federal tax laws. 

Section 255 was designed to ensure that

automatic cession statutes did not saddle the

United States with unwanted jurisdiction over

property acquired by the United States within

a state. See United States v. Johnson, 994

F.2d 980, 985 (2 Cir. 1993). nd

In their motion to dismiss filed on March 11, 2005, the

Littles now argue that the instant motion to dismiss is based on

their contention that United States v. Butler, 297 U.S. 1 (1936) 

WAS UNAUTHORIZED UNDER THE HISTORICAL FACTS

AND THE LAW OF THE UNITED STATES OF AMERICA,

PURSUANT TO THE ORIGINAL INTENT OF THE

FRAMERS OF THE FEDERAL CONSTITUTION, AND THE

PEOPLE OF THE UNITED STATES OF AMERICA, AT

THE ORIGINAL CONSTITUTIONAL CONVENTION OF

1787, BECAUSE THE PEOPLE REJECTED Alexander

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Hamilton’s IDEAS, ARGUMENTS, PROPOSITIONS AND

INTENTIONS FOR THE NEW GOVERNMENT UNDER THE

NEW CONSTITUTION AT THE SAID ORIGINAL

CONVENTION OF 1787, WHICH MEANS THE RULING

UNDER BUTLER, SUPRA, GOES AGAINST THE WILL

AND INTENTIONS OF THE PEOPLE OF THE UNITED

STATES OF AMERICA, DENYING CONSTITUTIONAL

GUARANTEE OF A REPUBLICAN FORM OF GOVERNMENT

EXPRESSLY MANDATED UNDER ARTICLE 4 SECTION 4

OF THE FEDERAL CONSTITUTION, AND ALSO IN

VIOLATION OF DEFENDANTS UNALIENABLE RIGHTS

UNDER THE 1 , 4 , 5 , 9 , 10 ARTICLES OF st th th th th

THE BILL OF RIGHTS OF 1991 [sic], AND THE

1 , 4 , 5 , 9 , 10 AMENDMENTS TO THE st th th th th

FEDERAL CONSTITUTION. UNDER THESE HISTORICAL

FACTS IT IS CLEAR THAT THE COURT HEREIN MUST

NOW RULE IN FAVOR OF THE RIGHT OF THE PEOPLE

AND DEFENDANTS TO A REPUBLICAN FORM OF

GOVERNMENT, AND TO UPHOLD THEIR UNALIENABLE

RIGHTS UNDER THE SAID BILL OF RIGHTS, AND

AMENDMENTS TO THE FEDERAL CONSTITUTION, TO

PRIVACY AND TO NOT ASSOCIATE OR CONTRACT WITH

THE FEDERAL GOVERNMENT AND TO BE SECURE IN

THEIR PAPERS AND EFFECTS, AND TO DUE PROCESS

OF LAW, ETC.

Defendants’ motion without merit. This court has the

jurisdiction to hear this case for the reasons articulated in the

United States’ opposition to this motion. Defendants’ arguments

that the Supreme Court in Butler wrongly decided the law is not a

position upon which this court can rely because this court is

bound by Supreme Court authority. Therefore, the Littles’ motion

on this ground is denied. 

As noted, the Littles filed an “Amendment” to their motion

to dismiss on June 9, 2005. The “Amendment adds two new grounds

upon which the Littles rely in contending that this action must

be dismissed. 

The Littles contend that this court has no jurisdiction to

hear this action because the action is not authorized by 26

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Furthermore, both the Complaint and the First Amended 1

Complaint allege: “In accordance with 26 U.S.C. §§ 7401 and 7403,

this action is commenced at the request and with the authorization

of the Chief Counsel of the Internal Revenue Service, a delegate of

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U.S.C. § 7401. 

Section 7401 provides that “[n]o civil action for the

collection or recovery of taxes, or of any fine, penalty, or

forfeiture, shall be commenced unless the Secretary authorizes or

sanctions the proceedings and the Attorney General or his

delegate directs that the action be commenced.” 

The Littles’ contention that this action has not been

authorized as required by Section 7401 is belied by the exhibits

submitted by the Littles in support of the “Amendment”. Attached

as an exhibit to the “Amendment” is a copy of a letter dated

August 17, 2001 from the Office of Chief Counsel, Internal

Revenue Service, to Assistant Attorney General O’Connor of the

Tax Division of the Department of Justice authorizing the

Department of Justice to commence a suit to reduce the tax

assessments to judgment and to foreclose on tax liens on real

property located at 23009 Avenue 230, Lemon Cove, California. 

Also attached as an exhibit to the “Amendment” is a copy a letter

dated January 31, 2002 from the Chief, Civil Trial Section,

Western Region, of the Tax Division of the Department of Justice

to United States Attorney John K. Vincent authorizing the filing

of this action. Although portions of these letters are redacted,

the two letters, taken together, show that the United States has

complied with Section 7401. The Littles nonetheless argue that 1

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the Secretary of the Treasury, and at the direction of the Attorney

General of the United States.”

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these two letters, produced to the Littles in discovery, “do not

prove under the rules of evidence that the plaintiff has fully

complied with ... Section 7401 [underling and capitalization

omitted].” The Littles assert:

Though there is a letter with letterhead

stating Department of the Treasury Internal

Revenue Service, Office of the Chief Counsel,

Small Business/Self-Employment Division

Counsel, it bares an address from San Jose,

California, not from the actual office of the

Chief Counsel, which is in Washington, D.C.,

and it is signed by two attorneys, who are

not identified as employees, officers or even

employees of the Treasury Department of the

United States of America, which does not

comply with the express requirement that the

action be authorized by the Secretary of the

Treasury or a delegate of the Secretary of

Treasury, nor is there any documentation of

any actual written request from the Attorney

General or his delegate ... Although there is

a heresay [sic] letter by Assistant Attorney

General Eileen J. O’Connor, signed by Jerome

H. Fridkin, Chief Civil Trial Section,

Western Region, that letter is from the

Department of Justice Tax Division, not the

Attorney General, and there is no evidence

produced that shows or establishes the person

who signed the document is actually a

delegate of the Attorney General of the

United States of America. 

The Littles contend that the exhibits attached to the “Amendment” 

“violate the best evidence rule, as they are heresay [sic]

documents” and further argue:

there is no authentication, affidavit, or

certification of authenticity, no foundation

to establish that the persons plaintiff is

purporting to have signed the letters in

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question are actually ‘officers, employees,

or agencies of the Treasury Department duly

authorized by the Secretary of the Treasury

directly, or indirectly by one or more

redelegations of authority to perform the

function mentioned or described in the

context’ of Section 7401 of U.S. Code ... as

is expressly required under federal law under

... Section 7701.

There is a presumption of regularity that attaches to the

actions of public officials. See Palmer v. I.R.S., 116 F.3d

1309, 1311 (9 Cir. 1997). The Littles have presented nothing th

to this court from which it may be inferred that this presumption

of regularity does not apply. There is no requirement that

delegation orders be published, United States v. Holm, 2001 WL

669279 (9 Cir. 2001). Pursuant to 26 U.S.C. § 7701(a)(11)(B) th

and (a)(12)(A), the term “Secretary” shall include “the Secretary

of the Treasury of his delegate” and the term “delegate” includes

“any officer, employee, or agency of the Treasury Department”. A

United States Attorney is authorized to commence an action to

convert an IRS assessment into judgment. 28 U.S.C. § 547(2). 

Furthermore, a United States Attorney may delegate an assistant

United States attorney to commence such an action on his behalf. 

28 U.S.C. § 542. Consequently, the court concludes from the

record that this action was validly commenced pursuant to Section

7401 and that this court has jurisdiction. 

The second ground for dismissal set forth in the “Amendment”

is the Littles’ contention that the United States has failed to

comply with the requirements of 26 U.S.C. § 6020, which provides

for the preparation and execution of substitute tax returns by

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the Secretary of the Treasury. The Littles argue that, in the

absence of such a substitute tax return, there can be no valid

assessment. The Littles contend that copies of the substitute

returns prepared in connection with their underlying tax

liabilities were not produced in discovery:

WHEN DEFENDANTS REQUESTED COPIES OF ANY

SUBSTITUTE RETURNS ... PLAINTIFF FAILED AND

REFUSED TO PROVIDE SAID REQUIRED SUBSCRIBED

RETURNS, AND MERELY RELIED ON THE PRIOR FILED

FORM 4340's AS PROOF OF PROPER ASSESSMENT OF

THE SAID ALLEGED TAXES, BUT THE FORM 4340 IS

ONLY A HERESAY [sic] CERTIFICATE, NOT DIRECT

EVIDENCE TO SUPPORT ANY CLAIM OF ASSESSMENT

BY PLAINTIFF, AND NO PROOF HAS BEEN PRODUCED

BY PLAINTIFF, THOUGH IT HAS BEEN REQUESTED ON

NUMEROUS OCCASSIONS [sic] BY DEFENDANTS IN

THIS CASE.

The Form 4340 referred to by the Littles are Certificates of

Assessment and Payment. The Ninth Circuit has held that

Certificates of Assessment and Payment constitute valid proof

that tax assessments were made and that the Certificates of

Assessment and Payment are not inadmissible hearsay. See United

States v. Hughes, 953 F.2d 531, 535, 539-540 (9 Cir. 1991). th

Furthermore, the filing of a substitute return pursuant to

Section 6020 is not a prerequisite to the issuance of a notice of

deficiency or to the issuance of an assessment. See Roat v.

C.I.R., 847 F.2d 1379, 1381-1382 (9 Cir. 1988); Pargett v. th

United States, 1991 WL 5168 (9 Cir. 1991); Pack v. United th

States, 1995 WL 783591 (E.D.Cal. 1995). Finally, in Geiselman v.

United States, 961 F.2d 1 (1 Cir.), cert. denied, 506 U.S. 891 st

(1992), the First Circuit rejected the taxpayer’s argument that

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the failure by the IRS to prepare adequate substitute returns

tainted the notice of deficiency, holding in pertinent part:

The substitute returns thus may have been of

no practical or legal value to the IRS in

calculating Michael’s deficiency or preparing

the notice, but that fact (if it is a fact)

has no consequence in this case. The

Internal Revenue Code’s deficiency procedures

‘do not require the Commissioner to prepare a

return on a taxpayer’s behalf before

determining and issuing a notice of

deficiency.’ ... When a taxpayer fails to

file any return, ‘it is as if he filed a

return showing a zero amount for purposes of

a deficiency.’ ... The deficiency is simply

‘the amount of tax due’ ... and it can be

calculated, and the notice prepared, on that

basis.

961 F.2d at 5. See also Wos v. C.I.R., 110 Fed.Appx. 689 (7th

Cir. 2004):

... Wos argues that there has been no valid

determination of his tax liability because

the Commissioner filed for each year a

substitute return labeled as a ‘substitute

for return.’ The tax code authorizes the

Commissioner to make a ‘return’ from

available information in determining the tax

liability of those who do not file returns;

the code nowhere prescribes a form or name

for this return ... Moreover, a substitute

return is not a precondition for issuing a

notice of deficiency, so it makes no

difference here whether or not the two

returns made on behalf of Wos were valid.

Therefore, this ground for dismissal asserted by the Littles is

without merit. 

ACCORDINGLY:

1. Defendants James and Lorna Little’s motion to dismiss is

denied.

///

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IT IS SO ORDERED.

Dated: September 23, 2005 /s/ Robert E. Coyle 

668554 UNITED STATES DISTRICT JUDGE

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