Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_07-cv-02763/USCOURTS-caed-2_07-cv-02763-1/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 28:1331 Federal Question: Other Civil Rights

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

MICHAEL T. CAREY, et al., No. CIV S-07-2762-LKK-CMK

Plaintiffs, 

vs.

STATE OF CALIFORNIA

FRANCHISE TAX BOARD, et al.,

Defendants.

 /

MICHAEL T. CAREY, et al., No. CIV S-07-2763-LKK-CMK

Plaintiffs, 

vs. FINDINGS AND RECOMMENDATIONS

PAUL ENJALRAN, et al.,

Defendants.

 /

Plaintiffs Michael T. Carey and Leone R. Carey, who are proceeding pro se, bring

these related civil actions. Pending before the court are plaintiffs’ complaints. 

/ / /

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The court is required to screen complaints brought by prisoners seeking relief

against a governmental entity or officer or employee of a governmental entity. See 28 U.S.C.

§ 1915A(a). The court is also required to screen complaints brought by litigants who have been

granted leave to proceed in forma pauperis. See 28 U.S.C. § 1915(e)(2). Under these screening

provisions, the court must dismiss a complaint or portion thereof if it: (1) is frivolous or

malicious; (2) fails to state a claim upon which relief can be granted; or (3) seeks monetary relief

from a defendant who is immune from such relief. See 28 U.S.C. §§ 1915(e)(2)(A), (B) and

1915A(b)(1), (2). Because plaintiffs, who are not prisoners, have been granted leave to proceed

in forma pauperis, the court will screen the complaint pursuant to § 1915(e)(2).

I. BACKGROUND

A. The Current Actions

In case no. CIV-S-07-2762-LKK-CMK, plaintiffs “allege[] that Defendants

imposed involuntary servitude upon them in violation of the Thirteenth Amendment to the

Federal Constitution by claiming, and collecting on a fictitious debt.” In case no. CIV-S-07-

2763-LKK-CMK, plaintiffs similarly “allege that Defendants imposed involuntary servitude

upon them in violation of the Thirteenth Amendment to the Federal Constitution by claiming,

and placing upon the official public record of Shasta County, a notice of a fictitious debt owed by

the Plaintiffs.” In both actions, plaintiffs allege they were denied substantive due process. 

In case no. CIV-S-07-2762-LKK-CMK, plaintiff set forth the following factual

allegations:

1. On August 9, 2005, plaintiffs were granted a full and complete discharge

in a Chapter 7 bankruptcy case;

2. The discharge was sent to defendant Enjalran by electronic transmission

on that date, and no objection or appeal was filed;

3. “In disregard of the bankruptcy discharge,” on June 4, 2007, defendant

Enjalran sent a notice of tax lien to defendant Morgan for filing on the

public record in Shasta County;

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A court may take judicial notice of court records. See MGIC Indem. Co. v. 1

Weisman, 803 F.2d 500, 505 (9th Cir. 1986); United States v. Wilson, 631 F.2d 118, 119 (9th

Cir. 1980). 

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4. Defendant Morgan filed the notice into a “lien index” in file no. 2007-

0025971 “with full knowledge of the bankruptcy discharge being of public

record”;

5. No evidence of debt was presented with the notice of tax lien and no

exemption from the bankruptcy discharge was presented with the notice;

6. Plaintiffs have been financially injured by the “fictitious debt” imposed

upon them by defendants;

7. Defendants’ “documentation is the undeniable and irrefutable evidence”

and is “their own confession of judgment”; and

8. Defendants’ documents entitle plaintiffs to judgment. 

The factual allegations in case no. CIV-S-07-2763-LKK-CMK are similar and differ only in the

following respects:

1. Notice of the discharge was sent to the State of California Franchise Tax

Board;

2. The discharge was recorded in the Shasta County public records in file no.

2007-0031479;

3. On November 7, 2007, defendant Franchise Tax Board issued an order for

defendant Tri Counties Bank to withhold funds in order to “enforce

payment of a fictitious amount due for California Personal Income Tax”;

4. Defendant Tri Counties Bank “took monies from 3 different checking

accounts . . .”; and

5. No garnishment documents were presented to defendant Tri Counties

Bank. 

B. Other Actions

The records of the United States District Court for the Eastern District of

California and the United States Bankruptcy Court for the Eastern District of California reveal

that plaintiffs and persons associated with them have been parties in numerous proceedings in

this district. The court hereby takes judicial notice of the following other actions: Michael 1

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 Robert G. Hogue filed the petition in his alleged capacity as trustee of sham trusts 2

set up by the plaintiffs.

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Carey and Leone Carey v. United States (In re Carey), Bankruptcy case no. 04-29060-B-7

(Bankr. E.D. Cal.), and of the adversary proceeding filed by the United States of America in that

case: In re Carey, 326 B.R. 816 (Bankr. E.D. Cal. Apr. 25, 2005) ( case no. 04-29060-B-7, adv.

04-2548). In addition, the undersigned takes judicial notice of the following proceedings in the

district court: Robert G. Hogue, Trustee v. Gil Akers, et al., case no. CIV-S-98-1539-LKK-PAN 2

(petition to quash IRS summons dismissed Mar. 26, 1999); Michael Carey v. IRS, et al., case no.

CIV-S-98-1540-LKK-PAN (petition to quash IRS summons dismissed Mar. 25, 1999); United

States v. Michael Carey, case no. MISC-S-98-0289-LKK-PAN (petition to enforce IRS summons

granted Mar. 25, 1999); United States v. Robert Hogue as trustee of Rancho Residential Facility

Trust, case no. MISC-S-98-0290-LKK-PAN (motion for summary enforcement of IRS summons

granted Mar. 25, 1999); United States v. Robert Hogue as trustee of Residential Management

Services Trust, case no. MISC-S-98-0291-LKK-PAN (petition to enforce IRS summons granted

Mar. 26, 1999); United States v. Robert Hogue as trustee of Sunshine Residential Facility Trust,

case no. MISC-S-98-0292-LKK-PAN (petition to enforce IRS summons granted Mar. 26, 1999);

United States v. Robert Hogue as trustee of Home Health Services Trust, case no. MISC-S-98-

0293-LKK-PAN (motion for summary enforcement of IRS summons granted Mar. 26, 1999);

United States v. Michael Carey as grantor of Rancho Residential Facility Trust, case no. MISCS-98-0294-LKK-PAN (petition to enforce IRS summons granted Mar. 25, 1999); United States

v. Michael Carey as grantor of Home Health Services Trust, case no. MISC-S-98-0295-LKKPAN (petition to enforce IRS summons granted Mar. 25, 1999); United States v. Michael Carey

as grantor of Residential Management Services Trust, case no. MISC-S-98-0296-LKK-PAN

(petition to enforce IRS summons granted Mar. 25, 1999); United States v. Michael Carey as

grantor of Sunshine Residential Facility Trust, case no. MISC-S-98-0297-LKK-PAN (petition to

enforce IRS summons granted Mar. 25, 1999); United States v. Michael Carey, et al., case no.

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CIV-S-95-2176-MCE-CMK (motion for summary judgment regarding tax liability of defendants

Michael Carey and Leone Carey granted July 5, 2007; appeal pending); and Michael Carey and

Leone Carey v. Shasta County, case no. CIV S-06-1265-FCD-CMK (plaintiffs’ claim based on

recording of federal and state tax liens by county recorder dismissed Sept. 6, 2006, without

prejudice to seeking relief from appropriate state court or agency). 

II. DISCUSSION

A claim is frivolous when it lacks an arguable basis either in law or in fact. See

Neitzke v. Williams, 490 U.S. 319, 325 (1989); Balistreri v. Pacifica Police Dep’t, 901 F.2d 696,

699 (9th Cir. 1990). To state a claim on which relief may be granted, the plaintiff must allege

“enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp. v.

Twombly, U.S. , 127 S.Ct. 1955, 1974 (2007). In considering whether a complaint states

a cognizable claim, the court accepts as true the material allegations in the complaint and

construes the allegations in the light most favorable to the plaintiff. See Hishon v. King &

Spalding, 467 U.S. 69, 73 (1984); Hosp. Bldg. Co. v. Trustees of Rex Hosp., 425 U.S. 738, 740

(1976); Love v. United States, 915 F.2d 1242, 1245 (9th Cir. 1989). Pro se pleadings are held to

a less stringent standard than those drafted by lawyers. See Haines v. Kerner, 404 U.S. 519, 520

(1972). However, the court is not required to accept as true conclusory allegations, unreasonable

inferences, or unwarranted deductions of fact. See Western Mining Council v. Watt, 643 F.2d

618, 624 (9th Cir. 1981).

The court finds that plaintiffs’ claims are frivolous, both factually and legally, and

fail to state any claim upon which relief may be granted in either action. First, the court

previously decided in the context of the adversary proceeding brought by United States in

plaintiffs’ bankruptcy case that plaintiffs’ taxes were not discharged. This is completely

consistent with 11 U.S.C. § 523, which specifies that tax debts are not discharged in bankruptcy. 

Therefore, the entire factual premise of these actions is false. The actions, therefore, are

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frivolous and must be dismissed. Given the defects of plaintiffs’ claims, it is clear that granting

leave to amend would be futile. See Reddy v. Litton Indus., Inc., 912 F.2d 291, 296-97 (9th Cir.

1990); Rutman Wine Co. v. E. & J. Gallo Winery, 829 F.2d 729, 738 (9th Cir. 1987). 

III. CONCLUSION

Based on the foregoing, the undersigned recommends that:

1. These actions be dismissed, without leave to amend and with prejudice, as

frivolous; and

2. The Clerk of the Court be directed to enter judgment in case nos. CIV-S07-2762-LKK-CMK and CIV-S-07-2763-LKK-CMK and close these files. 

These findings and recommendations are submitted to the United States District

Judge assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(l). Within 20 days

after being served with these findings and recommendations, any party may file written

objections with the court. The document should be captioned “Objections to Magistrate Judge's

Findings and Recommendations.” Failure to file objections within the specified time may waive

the right to appeal. See Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).

DATED: January 14, 2008

______________________________________

CRAIG M. KELLISON

UNITED STATES MAGISTRATE JUDGE

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