Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_10-cv-08153/USCOURTS-azd-3_10-cv-08153-1/pdf.json

Nature of Suit Code: 870
Nature of Suit: Tax Suits
Cause of Action: 28:1346 Recovery of IRS Tax

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 Although plaintiff does not include or reference the notices of disallowance in his

complaint, defendant included them as exhibits in its Motion to Dismiss. In a Rule 12(b)(1),

Fed. R. Civ. P. motion we may properly consider affidavits or other evidence before the court

to assess the complaint. See St. Clair v. City of Chico, 880 F.2d 199, 201-202 (9th Cir.

1989). 

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Stephan A. Drake, 

Plaintiff, 

vs.

United States of America, 

Defendant. 

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No. CV-10-08153-PCT-FJM

ORDER

The court has before it defendant's motion to dismiss (docs. 13 and 14), plaintiff's

response (docs. 18, 19), and defendant's reply (doc. 20). 

Plaintiff filed this action seeking recovery of penalties and interest assessed and

collected against him. Pursuant to 26 U.S.C. § 6700, defendant assessed penalties against

plaintiff for promoting an abusive tax shelter for the years 2003, 2004, and 2005. On

November 21, 2007 plaintiff timely filed a claim for refund. On May 16, 2008, the IRS

mailed its notices of disallowance to plaintiff.1

 On June 29, 2009, defendant denied

plaintiff's claim for refund. Finally on August 17, 2010, plaintiff filed this action.

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Defendant filed a Rule 12(b)(1) motion to dismiss for lack of subject matter

jurisdiction because plaintiff failed to file this action within the applicable statute of

limitations. Under 26 U.S.C. § 6532(a)(1), no taxpayer may seek a refund in the district

court more than two years after the IRS mails a notice of disallowance by certified or

registered mail. Defendant argues that § 6532(a)(1) is a waiver of sovereign immunity, and

therefore plaintiff's untimely filing deprives this court of subject matter jurisdiction. Plaintiff

argues only that the two year time period began to run not on May 16, 2008, the date the

notices of disallowance were mailed, but on June 29, 2009, the day the IRS denied his

appeal. Plaintiff cites no supporting authority, but relies exclusively on the fact that the

official IRS transcript does not reflect the May mailing date and therefore it should not apply

to him.

We agree with defendant that plaintiff's action is untimely. Section 6532(a)(1) must

be construed strictly in favor of the government. See Tosello v. United States, 210 F.3d

1125, 1127 (9th Cir. 2000) (citing Badaracco v. Comm'r., 464 U.S. 386, 398, 104 S.Ct. 756,

764 (1984). Both the Ninth Circuit and this court have denied relief in similar cases

involving a failure to comply with § 6532. See Tosello, 210 F.3d at 1128; Garrett v. United

States I.R.S., 8 Fed. Appx. 679 (9th Cir. 2001); Haze v. United States, No. Civ. 02-0742,

2002 WL 31662641 (D. Ariz. Sept. 30, 2002). Furthermore, § 6532(a)(4) specifically

provides that any "consideration, reconsideration, or action by the Secretary with respect to

such claim following the mailing of a notice by certified mail or registered mail of

disallowance shall not operate to extend the period within which suit may be begun." Thus,

plaintiff's appeal did not operate to extend the two-year statute of limitations. 

We do not, however, hold that a failure to comply with § 6532 deprives this court of

subject matter jurisdiction. Jurisdiction "is a word of many, too many meanings," which has

tempted courts to engage in "less than meticulous" use of the term. See Kontrick v. Ryan,

540 U.S. 443, 454, 124 S.Ct. 906, 915 (2004). In recent years the United States Supreme

Court has narrowed the term "jurisdictional," stating that it properly applies "only to

prescriptions delineating the classes of cases (subject-matter jurisdiction) and the persons

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(personal jurisdiction) implicating that jurisdiction." Reed Elsevier, Inc. v. Muchnick,

__U.S.__, __, 130 S.Ct. 1237, 1243 (2010) (internal citations omitted). The "jurisdictional

analysis must focus on the 'legal character' of the requirement . . . by looking to the

condition's text, context, and relevant historical treatment." Id. at 1246. Although in Dalm

v. United States, 494 U.S. 596, 601, 110 S.Ct. 1361, 1364 (1990), the Court held that a

failure to comply with 26 U.S.C. § 6511, a similar statute of limitations applicable to tax

refunds, deprived the court of subject matter jurisdiction, that case did not address § 6532 and

predated a string of recent cases criticizing earlier overuse of the term "jurisdictional." See

Henderson v. Shinseki, 526 U.S. __, __, No. 09-1036, *12 (2011) (holding that the deadline

for filing a notice of appeal with the Veterans Court "does not have jurisdictional attributes");

Reed, 130 S.Ct. at 1247 (holding that the Copyright Act's registration requirement is only a

precondition to filing not a jurisdictional requirement); Day v. McDonough, 547 U.S. 198,

205, 126 S.Ct. 1675, 1681 (2006) (stating that a statute of limitations defense is not

jurisdictional); Arbaugh v. Y & H Corp., 546 U.S. 500, 516, 126 S.Ct. 1235, 1245 (2006)

(holding that Title VII's numerosity requirement is an element of the claim, not

jurisdictional); Eberhart v. United States, 546 U.S. 12, 16, 126 S.Ct. 403, 405 (2005) (per

curiam) (finding that Rules 33, 45, Fed. R. Crim. P. were not jurisdictional); Scarborough v.

Principi, 541 U.S. 401, 413, 124 S.Ct. 1856, 1864 (2004) (stating that 28 U.S.C. §

2412(d)(1)(b)'s thirty day deadline for attorney fee applications is not properly called

"jurisdictional"); and Kontrick, 540 U.S. at 453-54, 124 S.Ct. at 914 (holding that a federal

bankruptcy procedural rule does not "create or withdraw federal jurisdiction"); but see

Bowles v. Russell, 551 U.S. 205, 209, 127 S.Ct. 2360, 2363 (2007) (holding that Rule 4(a),

Fed. R. App. P.'s thirty day time limit for filing a civil appeal is "mandatory and

jurisdictional").

We need not decide whether § 6532 is mandatory and jurisdictional, or whether it is

merely a claim processing rule. Plaintiff has not raised the issue and defendant timely

asserted in a Rule 12(b) motion a statute of limitations affirmative defense. See John R. Sand

& Gravel Co. v. United States, 552 U.S. 130, 133, 128 S.Ct. 750, 753 (2008) (discussing the

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2

 We note that the Court in John R. Sand cited Dalm as an example of the more

special, jurisdictional statute of limitations because it limited the scope of a governmental

waiver of sovereign immunity. See 552 U.S at 133, 128 S.Ct. at 753.

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difference between normal statutes of limitation that are subject to the rules of forfeiture and

waiver versus more absolute, possibly jurisdictional statutes of limitations).2

 Therefore, we

may properly dismiss the claim on unenumerated Rule 12(b) grounds.

Plaintiff seems to implicitly argue that the two-year statute should be equitably tolled

because he misinterpreted the data set forth in the IRS transcripts of account. We find no

authority to apply equitable tolling to this statute and decline to do so when plaintiff does not

expressly raise it. In United States v. Brockamp, 519 U.S. 347, 354, 117 S.Ct. 849, 853

(1997) the Court held that equitable tolling did not apply to § 6511 because "tax law, after

all is not normally characterized by case-specific exceptions reflecting individualized

equities." Id. at 352, 117 S.Ct. at 852. Although Congress later amended § 6511 to provide

for tolling when parties had certain financial difficulties, Brockamp still instructs us that

equitable tolling is not appropriate in the context of tax refunds. Moreover, the Federal

Circuit has held that § 6532 does not contain an implicit equitable exception. RHI Holdings

Inc. v. United States, 142 F.3d 1459, 1461-62 (Fed. Cir. 1998); see also Estate of Orlando

v. United States, 95 Fed. Cl. 286, 291 (Fed. Cl. 2010) (holding that a letter denying appeal

fails to extend the statute of limitations under § 6532(a)(2) and refusing to grant an equitable

extension). The absence of the May disallowance date in the IRS's transcript does not

provide good cause for ignoring the plain language of § 6532. 

 ACCORDINGLY, IT IS ORDERED GRANTING defendant's motion to dismiss

(docs. 13 and 14). The clerk shall enter judgment.

DATED this 4th day of March, 2011.

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