Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_07-cv-04234/USCOURTS-cand-5_07-cv-04234-2/pdf.json

Nature of Suit Code: 870
Nature of Suit: Tax Suits
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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1

 (Verified Petition to Enforce Internal Revenue Service Summonses ¶¶ 2-3, hereafter,

“Petition,” Docket Item No. 1.)

United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

United States of America, et al.,

Petitioners,

 v.

Paul J. Sholtz,

Respondent.

 /

NO. C 07-04234 JW 

ORDER TO SHOW CAUSE RE: CONTEMPT

In a Petition filed on August 17, 2007, the United States of America and Craig Harbidge,

Revenue Officer (collectively, “Petitioners”) allege as follows:

Craig Harbidge is an employee of the Internal Revenue Service (“IRS”).1 In the

course of his authorized duties, Harbidge has attempted to determine the federal tax liability

of Paul J. Sholtz (“Respondent”) for various periods from 2001 to 2006. (Petition ¶ 3.) 

Pursuant to authority granted under 26 U.S.C. §§ 7602 et seq., Harbidge served two

summonses on Respondent requiring him to produce documents regarding Respondent’s

income and to appear before Harbidge for investigation. (Id. ¶¶ 7-8, Ex. A.) Respondent did

not comply with the summonses. (Id. ¶ 10.)

On the basis of the allegations outlined above, Petitioners seek an order requiring

Respondent to comply with the summonses.

Case 5:07-cv-04234-JW Document 26 Filed 04/09/08 Page 1 of 4
United States District Court

For the Northern District of California

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2

 (See Docket Item No. 5.)

3

 (Report and Recommendation that Verified Petition to Enforce IRS Summonses be

Granted at 1, hereafter, “Lloyd Recommendation,” Docket Item No. 12.)

2

Upon filing, the case was assigned to Magistrate Judge Lloyd. On August 27, 2007, Judge

Lloyd issued an order to show cause why Respondent should not be compelled to comply with the

summonses. (See Docket Item No. 4.) Petitioners were required to serve the order to show cause on

Respondent by September 11, 2007. (Id.) Petitioners were unable to timely serve Respondent

because he refused to answer his door.2

On September 17, 2007, Judge Lloyd issued a second order to show cause. (See Docket Item

No. 7.) Respondent was served with the second order on October 16, 2007. (See Docket Item No.

8.) On October 18, 2007, Respondent submitted a letter to Judge Lloyd stating the following:

Dear Servant,

On Tuesday, October 16, 2007, Sirrah Tracy Wong – a private employee working for

the private offshore corporation known as the I.R.S. and an individual who has no lawful,

legal authority whatsoever to be serving a Summons – presented me with this notice which

apparently originated from your court.

Please note that your request to appear is hereby Refused for Cause.

Without Prejudice, All Rights Reserved,

/s/

Paul J. Sholtz

(See Docket Item No. 9.) Enclosed with the letter was the first page of the show cause order with a

handwritten note scribbled “REFUSED FOR CAUSE” in the middle of the page. (Id.)

On November 27, 2007, Respondent appeared at the show cause hearing. (See Docket Item

No. 11.) Respondent stated that he does not consent to the proceeding and that he does not

recognize the authority of the federal government. (See Docket Item No. 12.) Judge Lloyd

interpreted Respondent’s statements as a declination to proceed before a magistrate judge. Id.

Judge Llyod also issued a report recommending that the Petition be granted.3

 The case was

reassigned to this Court. (See Docket Item No. 14.)

On December 20, 2007, the Court issued an order adopting Judge Lloyd’s report and

granting the Petition to enforce the IRS summonses. (Order Granting Petition to Enforce

Case 5:07-cv-04234-JW Document 26 Filed 04/09/08 Page 2 of 4
United States District Court

For the Northern District of California

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Summonses, hereafter “Order,” Docket Item No. 16.) Respondent was ordered to comply with the

summonses within 60 days. (Id.) On January 8, 2008, Respondent sent Petitioners a letter in which

he denied the Court’s authority over this matter. (Declaration of Thomas Moore in Support of

Motion to Find Respondent in Contempt, Ex. 2, Docket Item No. 19.)

Before the Court is Petitioners’ Motion to Find Respondent in Contempt. (hereafter,

“Motion,” Docket Item No. 18.) A hearing on the motion is currently scheduled for April 14, 2008.

In light of the representations and the evidence presented, the Court VACATES the April 14, 2008

hearing. The Court orders Respondent to appear on May 5, 2008 at 9:00 a.m. and to show cause, if

any, why he should not be held in contempt for failing to comply with the Court’s December 20,

2007 Order. On or before April 25, 2008, Respondent shall file a certification in response to the

Order to Show Cause. The certification shall set forth the reasons why he has not complied with the

Court’s Order enforcing the summonses.

Failure to comply with any part of this Order will be deemed sufficient grounds to hold

Respondent in civil contempt.

Petitioners shall personally serve this Order on Respondent and file the appropriate

certificate of service.

Dated: April 9, 2008 

JAMES WARE

United States District Judge

Case 5:07-cv-04234-JW Document 26 Filed 04/09/08 Page 3 of 4
United States District Court

For the Northern District of California

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THIS IS TO CERTIFY THAT COPIES OF THIS ORDER HAVE BEEN DELIVERED TO:

Thomas Moore tom.moore@usdoj.gov

Paul J Sholtz

650 Castro Street, Suite 120-485

Mountain View, CA 94041

Dated: April 9, 2008 Richard W. Wieking, Clerk

By: /s/ JW Chambers 

Elizabeth Garcia

Courtroom Deputy

Case 5:07-cv-04234-JW Document 26 Filed 04/09/08 Page 4 of 4