Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_05-cv-01339/USCOURTS-caed-1_05-cv-01339-1/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 28:1343 Violation of Civil Rights

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1

IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

CHARLES H. BOND, ) 

 )

Plaintiff, )

)

vs. )

)

MARK W. EVERSON and LAUREL )

 SMITH, )

 )

Defendants. )

)

) 

No. CV-F-05-1339 REC SMS

ORDER (1) DENYING

PLAINTIFF’S MOTION FOR

DEFAULT JUDGMENT, (2)

GRANTING THE UNITED STATES’

MOTION TO DISMISS, AND (3)

DIRECTING THE CLERK TO

ENTER JUDGMENT FOR

DEFENDANTS. 

(Docs. 9 & 12) 

On February 27, 2006, the Court heard Plaintiff Charles H.

Bond’s Motion for Default Judgment and the United States’ Motion

to Dismiss. Upon due consideration of the written and oral

arguments of the parties and the record herein, the Court DENIES

Plaintiff’s Motion for Default Judgment and GRANTS the United

States’ Motion to Dismiss, as set forth herein.

I. Background

The facts, as alleged in the Complaint, are as follows. 

Plaintiff filed a personal income tax return for the year 2001 in

the name of the “CHARLES H. BOND TRUST.” Compl. Ex. A at 1. He

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claimed a total trust income of $72,651 from which he deducted

fiduciary fees of $72,223, reporting a taxable income of $428. 

Id. 

On October 29, 2002, the Internal Revenue Service (IRS) sent

Plaintiff a notice that he would receive a refund of $7188.80. 

On February 27, 2004, the IRS sent Plaintiff a “Notice of

Deficiency” for the 2001 tax year. Compl. Ex. C. Enclosed with

the notice was a Substitute for Return (“SFR”) that the IRS had

prepared for Plaintiff. Id. Thomas D. Mathews of the IRS’s

Ogden Service Center prepared the SFR on behalf of Defendant Mark

Everson, Commissioner of the IRS. According to the SFR

Plaintiff’s corrected taxable income was actually $57,412,

meaning that he was not entitled to a refund but rather owed a

deficiency of $7,220, plus penalties. See id.

Plaintiff objected to the filing of the SFR and requested a

due process hearing. On June 28, 2005, Plaintiff received a

notice of a Collection Due Process hearing. The hearing

eventually took place by telephone on October 5, 2005. Defendant

Laurel Smith, a Settlement Officer with the IRS, conducted the

hearing. Plaintiff alleged in his appeal that the IRS lacked the

authority to file a return on his behalf, that the IRS failed to

respond properly to his objections to its actions, and that he

was denied due process of law. During the hearing, Defendant

Smith determined that the IRS followed proper procedure and that

Internal Revenue Code section 6020(b) (“Section 6020(b)”)

authorized the IRS to file a return on Plaintiff’s behalf. See

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Federal Rule of Civil Procedure 12 reads, in relevant part, 1

as follows:

(3) (A) The United States, an agency of the

United States, or an officer or employee of

the United States sued in an official

capacity, shall serve an answer to the

complaint or cross-claim — or a reply to a

counterclaim — within 60 days after the United

States attorney is served with the pleading

asserting the claim.

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26 U.S.C. § 6020. Plaintiff claims that the IRS had the burden

to demonstrate that his 2001 return was false or fraudulent and

failed to meet that burden. 

On October 24, 2005, Plaintiff filed this lawsuit, alleging

that Defendants infringed his due process rights by issuing the

SFR and deciding that issuing the SFR was proper and that

Defendants’ actions violated the separation of powers doctrine. 

On December 12, 2005, Plaintiff filed his Motion for Default

Judgment. On January 11, 2006, the United States, on behalf of

Defendants, filed its Opposition to the Motion for Default

Judgment. On the same day, the United States also filed its

Motion to Dismiss. On January 20, 2006, Plaintiff filed its

Reply in support of the Motion for Default Judgment. On February

17, 2006, Plaintiff filed his Opposition to the Motion to

Dismiss.

II. Plaintiff’s Motion for Default Judgment

Plaintiff claims that he is entitled to default judgment

because Defendants failed to respond to the Complaint in a timely

manner. Under Federal Rule of Civil Procedure 12(a)(3),1

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(B) An officer or employee of the United

States sued in an individual capacity for acts

or omissions occurring in connection with the

performance of duties on behalf of the United

States shall serve an answer to the complaint

or cross-claim — or a reply to a counterclaim

— within 60 days after service on the officer

or employee, or service on the United States

attorney, whichever is later.

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officers or employees of the United States have 60 days to answer

a complaint or cross claim when sued in their official capacity

or for acts or omissions connected to their duties. Fed. R. Civ.

P. 12(a)(3)(A), 12(a)(3)(B). If the suit is against the officer

or employee in his official capacity, the 60 days begins when the

United States attorney is served. Fed. R. Civ. P. 12(a)(3)(A). 

If the suit is against the officer or employee in his individual

capacity “for acts or omissions occurring in connection with the

performance of duties on behalf of the United States,”

the 60 days begins when the officer or employee is served or the

United States attorney is served, whichever occurs later. Fed.

R. Civ. P. 12(a)(3)(A).

Plaintiff does not claim to have served, nor does he provide

proof that he has served, the United States Attorney for the

Eastern District of California, or any other United States

Attorney. See Pl.’s Mot. for Default ¶¶ 3-4, Exs. B, C & D; Fed.

R. Civ. P. 4(i)(1)(A), 4(i)(2)(B). Plaintiff waives any claims

related to Defendants’ actions in their official capacity. Pl.’s

Reply in Supp. of Mot. for Default 3:6-8. Therefore, if

Plaintiff’s suit is against Defendants solely for duty-related

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acts or omissions, then under Rule 12(a)(3)(A) the 60 days

allowed to answer the complaint has not yet begun to run.

The Complaint alleges that Defendants violated Plaintiff’s

rights under the Fifth Amendment and the doctrine of separation

of powers of the United States Constitution. Specifically, the

Plaintiff alleges that Defendant Everson “executed an SFR

(Substitute For Return)” on behalf of Plaintiff without his

consent. Compl. ¶ 14. This action is connected to Mr. Everson’s

duties as Commissioner of the IRS, which Plaintiff alleges are

“to administer and supervise the execution and application of the

internal revenue laws.” Compl. ¶ 12. 

Plaintiff alleges that Defendant Smith violated his

constitutional rights when she determined that the “IRS did

follow proper procedure” when it executed the SFR. Compl. ¶ 17. 

This conduct falls squarely within the scope of Defendant Smith’s

duties. According to the Complaint, Ms. Smith’s duties as

“Appeals Officer” are to hold “‘collection due process hearings’

for the Internal Revenue Service Appeals Department located at

the Fresno Campus Appeals Office.” Compl. ¶ 12. 

Furthermore, Plaintiff alleges that “[a]t all times

mentioned herein, Defendants the ‘Commissioner’ and the ‘Appeals

Officer,’ acted under color of their authority as such . . .” 

Compl. ¶ 8. With that language, Plaintiff concedes that all of

Defendants’ alleged misconduct is “in connection with” their

official duties, triggering the service requirements of Rule

12(a)(3)(A). 

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Rule 4(i)(1) of the Federal Rules of Civil Procedure provides 2

that service “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

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The Court finds that because Plaintiff has not yet properly

served Defendants, the 60 day period that the Federal Rules allow

Defendants to answer Plaintiff’s Complaint has not yet commenced. 

Accordingly, Plaintiff’s Motion for Default Judgment is DENIED.

II. United States’ Motion to Dismiss

A. Insufficiency of Service of Process

The United States argues that the Complaint should be

dismissed because Plaintiff has failed to serve Defendants

properly under Rule 4 of the Federal Rules of Civil Procedure. 

Where United States officers or employees are “sued in an

individual capacity for acts or omissions occurring in connection

with the performance of duties on behalf of the United States,”

service must comply with the requirements of Rule 4(i)(1). Fed. 2

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copy of the summons and of the complaint by

registered or certified mail to the officer or

agency.

7

R. Civ. P. 4(i)(2)(B). Rule 4(i)(1) requires delivery of a copy

of the summons and complaint to the United States attorney’s

office for the district in which the action is filed, to the

Attorney General of the United States, and to any officer or

agency whose order the complaint attacks that is not a party. 

As the Court held above, Defendants are sued only for

actions in connection with their duties as employees of the

United States. See, e.g., Compl. ¶ 8. Plaintiff has failed to

serve both the United States Attorney for the Eastern District of

California and the Attorney General of the United States. See

Pl.’s Mot. for Default ¶¶ 3-4, Exs. B, C & D. Thus, Plaintiff

has failed to properly serve Defendants under Rule 4(i)(2)(A).

Where it appears that a plaintiff can effectively serve the

defendant and defendant will not suffer prejudice, courts should

quash the service rather than dismiss the action. William W.

Schwarzer et al., California Practice Guide: Federal Civil

Procedure Before Trial § 9:154 (2005); see Hill v. Sands, 403 F.

Supp. 1368, 1370 (N.D. Ill. 1975). The United States does not

contend that Plaintiff will ultimately be unable to properly

serve Defendants. Nor does it contend that Defendants would

suffer prejudice should Plaintiff properly serve Defendants

later. Furthermore, the Federal Rules require a court to “allow

a reasonable time to serve process” to cure a failure to serve

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the United States in an action against an officer or employee

sued in an individual capacity. Fed. R. Civ. P. 4(i)(3)(B). 

Accordingly, the United States’ motion to dismiss for

insufficient service of process is DENIED. 

B. Failure to State a Claim

Plaintiff’s failure to properly serve Defendants does not

preclude the Court from reaching the merits of the United States’

motion to dismiss the Complaint for failure to state a claim. 

Wages v. IRS, 915 F.2d 1230, 1235 (9th Cir. 1989) (holding that

district court did not err in dismissing claims against

individual IRS employees based on defects in service of process

and based on failure to state a claim). 

Dismissal of a complaint pursuant to Rule 12(b)(6) is proper

if “it appears beyond doubt that the plaintiff can prove no set

of facts in support of his claim which would entitle him to

relief.” Conley v. Gibson, 355 U.S. 41, 45-46, 78 S. Ct. 99, 2

L. Ed. 2d 80 (1957). In testing the sufficiency of a complaint

against a Rule 12(b)(6) challenge, a court must “accept all

material allegations in the complaint as true and construe them

in the light most favorable to the plaintiff.” N. Star Int’l v.

Ariz. Corp. Comm’n, 720 F.2d 578, 580 (9th Cir. 1983). The Court

need not, however, “accept legal conclusions cast in the form of

factual allegations if those conclusions cannot reasonably be

drawn from the facts alleged.” Clegg v. Cult Awareness Network,

18 F.3d 752, 754-55 (9th Cir. 1994). 

A complaint may be dismissed as a matter of law if there is

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a lack of a cognizable legal theory or if there are insufficient

facts alleged under a cognizable legal theory. Balistreri v.

Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990). The

Court must determine whether or not it appears to a certainty

under existing law that no relief can be granted under any set of

facts that might be proved in support of a plaintiff’s claims. 

De La Crux v. Tormey, 582 F.2d 45, 48 (9th Cir. 1978), cert.

denied, 441 U.S. 965, 99 S. Ct. 2416, 60 L. Ed. 2d 1072 (1979). 

1. Declaratory and Injunctive Relief

Presumably because of concerns about sovereign immunity,

Plaintiff concedes that he “did not and could not have sued the

‘United States.’” Pl.’s Reply in Supp. of Mot. for Default 2:20-

22. He also “waives any claim or challenge as to Defendants

acting in their ‘official capacity.’” Pl.’s Reply in Supp. of

Mot. for Default 3:6-8. Plaintiff reiterated at oral argument

that he is not suing the United States or suing Defendants in

their official capacities.

The only claims that Plaintiff does not concede are against

Defendants in their individual capacities. Merely naming

individual federal officers and employees does not establish an

individual capacity claim where the relief sought is not damages

against the individual defendants but an order against the

sovereign. Larson v. Domestic & Foreign Commerce Corp., 337 U.S.

682, 688-89 (1949) (holding that request for declaratory and

injunctive relief against the government based on the actions of

individual defendants was an action against the United States). 

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An action is against the government “if the judgment sought would

expend itself on the public treasury or domain, or interfere with

the public administration, or if the effect of the judgment would

be to restrain the Government from acting, or to compel it to

act.” Dugan v. Rank, 372 U.S. 609, 620, 83 S. Ct. 999, 10 L. Ed.

2d 15 (1963). 

Plaintiff seeks an order that the IRS improperly decided

that Section 6020 authorized the Secretary to file an SFR for

Plaintiff. He also seeks the Court’s declaratory judgment that

Section 6020 is unconstitutional. Any order affecting

Plaintiff’s tax liability would “expend itself on the public

treasury” and therefore be an order against the United States. 

See Dugan, 372 U.S. at 620. Any order that the IRS modify its

procedure, either generally or with respect to Plaintiff only,

would “interfere with the public administration.” See id. This

relief could not be obtained through a claim against Defendants

in their individual capacities. Accordingly, by conceding any

claims against the United States, Plaintiff cannot prevail on any

claim that would result in declaratory or injunctive relief

binding on the United States.

2. Claims for Damages under Bivens

It appears that the only remaining claims Plaintiff makes

are claims that Defendants are liable in their individual

capacities for the alleged constitutional violations under Bivens

v. Six Unknown Named Agents of the Federal Bureau of Narcotics,

403 U.S. 388, 91 S. Ct. 1999, 29 L. Ed. 2d 619 (1971). Plaintiff

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states in his Opposition, however, that “Plaintiff has not

brought a ‘Bivens’ action to this Court against anyone.” Pl.’s

Opp’n to Mot. to Dismiss 5:19-21 (emphasis in original). 

Plaintiff cites in support of the individual capacity claims

Gilbert v. Da Grossa, 756 F.2d 1455 (9th Cir. 1985). Gilbert,

however, does not set forth a basis for individual capacity

liability. Id. at 1459. Rather, the Ninth Circuit merely held

in that case that when the plaintiff brings a meritorious suit

against a federal employee in an individual capacity, such as

under Bivens, sovereign immunity does not operate as a bar. Id. 

Plaintiff does not point to any basis other than Bivens, and the

Court is aware of none, for individual capacity liability of

Defendants for constitutional violations. 

In Bivens, the Supreme Court recognized a cause of action

for damages against “a federal agent acting under color of his

authority.” Id. at 389. The Ninth Circuit has addressed the

issue of whether to extend Bivens to cases where IRS employees

are alleged to have improperly collected taxes. Wages, 915 F.2d

at 1235. The Ninth Circuit concluded that it has “never

recognized a constitutional violation arising from the collection

of taxes.” Id. Remedies that Congress provides allow a taxpayer

to sue the government for improperly collected taxes. Id. Those

legislative remedies foreclose a damage action under Bivens. 

Id.; see, e.g., Del Elmer v. Metzger, 967 F. Supp. 398, 402 (S.D.

Cal. 1997); Krieg v. Mills, 117 F. Supp. 2d 964, 969 (N.D. Cal.

2000). 

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“When the design of a Government program suggests that

Congress has provided what it considers adequate remedial

mechanisms for constitutional violations that may occur in the

course of its administration, we have not created additional

Bivens remedies.” Schweiker v. Chilicky, 487 U.S. 412, 423, 108

S. Ct. 2460, 2468, 101 L. Ed. 2d 370 (1988). The Internal

Revenue Code includes statutory provisions that set forth “the

exclusive remedy for recovering damages” for misconduct by an

officer or employee of the IRS in connection with the collection

of federal taxes. 26 U.S.C. § 7433; Wages, 915 F.2d at 1235; see

also Fishburn v. Brown, 125 F.3d 979, 983 (6th Cir. 1997)

(holding that section 1743 is the exclusive remedy against IRS

officers or employees for improper collection of taxes). Such a

suit under Section 7433 may only be brought against the United

States, not against IRS employees in their individual capacities. 

People ex rel. Ervin, 170 F. Supp. 2d 1040, 1046 (E.D. Cal. 2001)

(“Section 7433(a) specifically provides that such an action is

brought against the United States.”)

 Plaintiff’s claims arise solely from allegedly improper

collection of taxes, specifically the preparation of his return

under Section 6020 and a later appeal upholding that ruling. 

Thus 26 U.S.C. section 7433 relief against the United States is

the exclusive remedy Plaintiff may seek. However, Plaintiff

concedes that he “did not and could not have sued the ‘United

States.’” Pl.’s Reply in Supp. of Mot. for Default 2:20-22.

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3. Leave to Amend

A court may dismiss a complaint without leave to amend where

“the allegation of other facts consistent with the challenged

pleading could not possibly cure the deficiency.” Schreiber

Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th

Cir. 1986). Plaintiff has conceded the futility of stating

claims against the United States and against Defendants in their

official capacities. Furthermore, regardless of what facts

Plaintiff alleges, he cannot state an individual-capacity claim

against an IRS official for constitutional violations. See

Wages, 915 F.2d at 1235. The Court finds that any attempt of

Plaintiff to amend the Complaint will be futile. Therefore,

leave to amend the Complaint is DENIED.

ACCORDINGLY:

1. Plaintiff’s Motion for Default Judgment is DENIED.

2. Plaintiff’s Complaint is DISMISSED WITH PREJUDICE.

3. The Clerk of the Court shall enter judgment for the

Defendants.

IT IS SO ORDERED.

Dated: February 28, 2006 /s/ Robert E. Coyle 

810ha4 UNITED STATES DISTRICT JUDGE

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