Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_05-cv-00027/USCOURTS-caed-1_05-cv-00027-0/pdf.json

Parties Involved:
Michael Wayne Austin
Petitioner
Commissioner of Internal Revenue
Respondent

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1

IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

MICHAEL AUSTIN, )

)

)

)

Petitioner, )

)

vs. )

)

)

COMMISSIONER OF INTERNAL )

REVENUE, )

)

)

Respondent. )

)

)

No. CV-F-05-027 REC

ORDER GRANTING RESPONDENT'S

MOTION TO DISMISS,

DISMISSING ACTION, AND

DIRECTING ENTRY OF JUDGMENT

FOR RESPONDENT

Respondent moves to dismiss this action for lack of subject

matter jurisdiction. For the reasons set forth below, the court

grants respondent's motion and dismisses this action.

Michael Wayne Austin, proceeding in pro per, filed a

Petition with this court on January 6, 2005. The Petition moves

to “void/cancel, an illegal assessment pursuant to I.R.C. § 6672,

a Trust Fund Recovery Penalty and refund all monies respondent

has previously collected.” The Petition alleges that the “IRS

has failed to comply with the Fair Debt Collection Practice Act

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which requires the IRS treatment of Tax Debtors to be at least

equal to that of private section debtors pursuant to IRC 6304"

and seeks an “award of damages sustained by this petitioner

pursuant to IRC 7433.” The Petition further alleges in pertinent

part:

This Petition comes to this Court pursuant to

a dismissal of a United States Tax Court case

docket # 19918-03S on or about December 01,

2004. Recently, upon following up the status

of the case, this petitioner discovered the

dismissal, but, has not been served, as of

today, with any U.S. Tax Court order.

A. Failure to Timely File Petition. 

An “Order of Dismissal for Lack of Jurisdiction” was filed 

by the United States Tax Court in Michael Wayne Austin v.

Commissioner of Internal Revenue, Docket No. 19918-038 on

December 1, 2004, which Order states:

On August 31, 2004, respondent filed a motion

to dismiss for lack of jurisdiction. 

Petitioner filed an opposition to motion to

dismiss for lack of jurisdiction on September

16, 2004. On September 29, 2004, respondent

filed a reply to petitioner’s opposition to

motion to dismiss for lack of jurisdiction. 

Respondent’s motion was calendared for

hearing at the Court’s trial session in

Fresno, California. The hearing was held on

September 29, 2004. This case is an appeal

by petitioner for abatement of an assessment

against him by the Internal Revenue Service

and respondent’s determination to proceed

with collection under section 6330 of the

Internal Revenue Code. The record shows that

the assessment at issue is for trust fund

taxes under section 6672, in which respondent

determined that petitioner was a responsible

person required to collect, account for, and

pay over to the Internal Revenue Service

income tax and payroll tax withholdings of

employees of a corporation, Austin Oil Co. 

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Petitioner was determined to be a responsible

officer of the corporation and was assessed

for the unpaid tax liabilities. Pursuant to

a notice of determination concerning

collection actions under section 6320 and/or

6330, in which respondent declined to abate

the assessment, petitioner filed a petition

with this Court. The tax at issue in this

case is the penalty under section 6672. 

Under section 6672(c)(2), the Federal

District Court or the Court of Claims has

jurisdiction to determine a taxpayer’s

liability for the tax or penalty under that

section. The Tax Court has no jurisdiction

over taxes due under section 6672. In Moore

v. Commissioner, 114 T.C. 171 (2000), the

Court held that the opportunity for judicial

review of collection matters under section

6330 is limited to those types of taxes over

which this Court has deficiency jurisdiction. 

As noted, this Court has no jurisdiction to

determine a taxpayer’s liability for trust

fund tax or penalty under section 6672. It

follows, therefore, that this Court has no

jurisdiction over petitioner’s appeal in this

case. However, petitioner is entitled, under

section 6330(d)(1), to file an appeal with

the U.S. District Court within 30 days from

the date of this Order. On these premises,

therefore, it is 

ORDERED that respondent’s motion to dismiss

this case for lack of jurisdiction, filed on

August 31, 2004, is granted.

As the Tax Court noted, “[i]f a court determines that the appeal

was to an incorrect court, a person shall have 30 days after the

court determination to file such appeal with the correct court.”

Here, petitioner did not file his petition with this court

30 days after the Tax Court’s determination that it lacked

jurisdiction over the appeal. 26 U.S.C. § 6330(d)(1) provides in

pertinent part:

If a court determines that the appeal was to

an incorrect court, a person shall have 30

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days after the court determination to file

such appeal with the correct court.

“The United States, as sovereign, is immune from suit save

as it consents to be sued ... and the terms of its consent to be

sued in any court define that court’s jurisdiction to entertain

the suit.” Hercules, Inc. v. United States, 516 U.S. 417 (1996). 

When the defendant challenges subject matter jurisdiction through

a motion to dismiss, the plaintiff bears the burden of

establishing jurisdiction. Hedgepeth v. State of Tennessee, 215

F.3d 608, 611 (6th Cir. 2000). 

The United States contends that this court lacks subject

matter jurisdiction over petitioner’s appeal because it was not

filed with this court until 36 days after the Tax Court’s

determination that the Tax Court lacked jurisdiction. 

In his opposition, petitioner contends that he was not

served with the Tax Court’s determination until he received a

copy of it in the mail on January 11, 2005. He attaches to his

opposition a photocopy of the face page of an envelope addressed

to petitioner from the Tax Court bearing a postage meter stamp

dated January 4, 2005. Petitioner has also filed a declaration

in which he avers in pertinent part:

I declare that the document attached hereto

... is a true and correct copy of the United

States Tax Court’s Order of Dismissal along

with the envelope that bears the US postmark

regarding Austin v. Commissioner, Docket No.

19918-03S. 

The court takes judicial notice of the docket of

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1The docket of petitioner’s action in the U.S. Tax Court is

available at www.ustaxcourt.gov/.

2In his opposition, petitioner moves the court to strike the

Order of Dismissal pursuant to Local Tax Court Rule 5-135 because

the “Tax Courts [sic] notice of dismissal lacks service of

process.” It is apparent that petitioner is referring to Rule 5-

135, Local Rules of the United States District Court for the

Eastern District of California. Rule 5-135 pertains to the service

of documents during the pendency of an action by the parties to the

action. Rule 5-135 has no application to service of orders by the

United States Tax Court and, therefore, petitioner’s request that

this court strike the Order of Dismissal is without merit. In

addition, petitioner’s reliance on 26 U.S.C. § 7502 is misplaced

because Section 7502 does not apply to the filing of a document in

any court other than the United States Tax Court. 26 U.S.C. §

7502(d)(1).

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petitioner’s action in the United States Tax Court.1 According

to that docket, the Order of Dismissal was entered on December 1,

2004 and was served on December 1, 2004. The court accepts the

docket entry as accurate because because petitioner filed the

Petition with this court before he avers in his declaration that

he was served by mail with the Order of Dismissal. 

Furthermore, as the United States notes, Section 6330(d)(1)

provides that “a person shall have 30 days after the court

determination” to file in the correct court. Nothing in Section

6330(d)(1) mentions service of the court’s determination.

Because the court is addressing an issue of sovereign immunity,

the wording of the statute and the absence of any applicable case

law persuades the court that it must dismiss this petition for

lack of subject matter jurisdiction.2

B. Failure to Effect Service of Process.

The United States further moves to dismiss this action for

lack of personal jurisdiction on the ground that petitioner has

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not properly served the petition as required by Rule 4, Federal

Rules of Civil Procedure. 

Rule 4(I), Federal Rules of Civil Procedure, pertains to

service of process on the United States, its agencies,

corporations, officers or employees. Rule 4(I)(1) provides in

pertinent part:

(1) Service upon the United States shall be

effected

(A) by delivering a copy of 

summons and 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 of by sending a

copy of the summons and 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 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 copy of the summons and of

the complaint by registered or certified mail

to the officer or agency. 

(2)(A) Service on an agency ... of the United

States, or an officer or employee of the

United States sued only in an official

capacity, is effected by serving the United

States in the manner prescribed by Rule

4(I)(1), and by also sending a copy of the

summons and complaint by registered or

certified mail to the officer, employee [or]

agency ....

 (B) Service on an officer or employee of

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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 - whether or not

the officer or employee is sued also in an

official capacity - is effected by serving

the United States in the manner prescribed by

Rule 4(I)(1) and by serving the officer or

employee in the manner prescribed by Rule

4(e), (f), or (g).

(3) The court shall allow a reasonable time

to serve process under Rule 4(I) for the

purpose of curing the failure to serve:

(A) all persons required to be

served in an action governed by Rule

4(i)(2)(A), if the plaintiff has served

either the United States attorney or the

Attorney General of the United States, or 

(B) the United States in an 

action governed by Rule 4(i)(2)(B), if the

plaintiff has served an officer or employee

of the United States sued in an official

capacity.

Attached to the Petition is a Certificate of Service showing

that the Petition was served on January 6, 2005,

by mailing to same in a postage-prepaid

wrapper addressed to:

John W. Strate

Attorney, (SBSE)

Internal Revenue Service

55 S. Market Street, Suite 505

San Jose, CA 95113

Donald L. Korb,

Chief Counsel

Internal Revenue Service

55 S. Market Street, Suite 505

San Jose, CA 95113

United States Distric [sic] Court

For the Eastern Distric [sic] of California

1130 O Street

Fresno, Ca 93721

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Thus, there is no indication in the record that petitioner

has complied with these requirements of Rule 4(i). In his

opposition, petitioner asserts:

Service of process upon the Internal Revenue

Service, a division of the Department of

Treasury of the United States of America is

accomplished by sending notice to Chief

Counsel of the Internal Revenue Service,

while filing, at the same time a petition

before the United States District Court for

the Eastern District of California in Fresno,

California.

Actual notice of petitioner’s United States

District Court [sic] was perfected on Jan. 6,

2005 in conjunction with this case and was

previously completed as of November 21, 2003,

on the United States Tax Court Case docket

#19918-03 S. In both cases, sufficient

notice was done to effect service of process. 

The issue, therefore, is whether this court

believes Chief Counsel of the Internal

Revenue Service, Donald L. Korb, is an

Officer of and for the Internal Revenue

Service.

Petitioner’s opposition establishes that he has not complied with

the service requirements of Rule 4(i).

Compliance with the service of process requirements of Rule

4 is necessary to establish personal jurisdiction and this

compliance is required notwithstanding any actual notice of the

lawsuit that the defendant may have had. See Seig v. Karnes, 693

F.2d 803, 807 (9th Cir. 1982). 

Therefore, this petition is dismissed because of

petitioner’s failure to accomplish service as required by Rule

4(i). 

C. Claim for Damages.

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Finally, the United States argues that this court lacks

jurisdiction over petitioner’s claim for damages under 26 U.S.C.

§ 7433. 

Section 7433(d)(1) provides that “[a] judgment for damages

shall not be awarded under subsection (b) unless the court

determines that the plaintiff has exhausted the administrative

remedies available to such plaintiff within the Internal Revenue

Service.” 26 C.F.R. § 301.7433-1(e) sets forth the procedures

for an administrative claim under Section 7433. This court lacks

jurisdiction over a claim for damages under Section 7433 in the

absence of an allegation that the taxpayer has exhausted these

administrative remedies. Conforte v. United States, 979 F.2d

1375, 1379 (9th Cir. 1992). 

In his opposition, petitioner contends:

There are several prerequisites the IRS must

meet before a denial of an IRC sec 7433 claim

can be put into court. First, the IRS must

issue a statutory notice of deficiency to the

taxpayer. Secondly, the IRS must deny an

administrative claim brought forth by the

taxpayer. Here, the IRS, respondent, has

done neither. Moreover, the running of the

period of statute of limitations is suspended

until the Court decision becomes final, and

for an additional 60 days thereafter,

pursuant to IRS sec 6503(a)(1). This Court

retains jurisdiction over respondents’ [sic]

administrative inactions [sic].

However, as the United States notes, petitioner was not

entitled to a notice of deficiency. 26 U.S.C. § 6212(a) provides

for a notice of deficiency “[i]f the Secretary determines that

there is a deficiency in respect of any tax imposed by subtitles

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A or B or chapter 41, 42, 43, or 44 ....” The penalty assessed

against petitioner was assessed pursuant to 26 U.S.C. § 6672. 

The statutory notice of deficiency described in Section 6212(a)

does not apply to a penalty assessed pursuant to Section 6672. 

See Boyton v. United States, 566 F.2d 50, 53 (9th Cir. 1977);

Shaw v. United States, 331 F.2d 493, 494-495 (9th Cir. 1964). 

Because petitioner was not entitled to a statutory notice of

deficiency, his reliance on the tolling provision of Section

6503(a)(1) is misplaced. Furthermore, petitioner’s contention

that he is entitled to damages pursuant to Section 7433 because

the IRS has not denied an administrative claim filed by

petitioner basically admits that petitioner has not exhausted the

required administrative remedies.

Consequently, petitioner’s claim for damages pursuant to

Section 7433 is dismissed for lack of jurisdiction.

ACCORDINGLY, respondent’s motion to dismiss is granted and

this action is dismissed for lack of jurisdiction.

The Clerk of the Court is directed to enter judgment for

respondent.

IT IS SO ORDERED.

Dated: April 26, 2005 /s/ Robert E. Coyle 

668554 UNITED STATES DISTRICT JUDGE

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