In the United States Court of Federal Claims

No. 14-106T

Filed: December 13, 2016

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MARK V. NOFFKE,

 

 Plaintiff,

v. 

UNITED STATES,

Defendant.

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Trial; Tax; 26 U.S.C. § 6672; 

Responsible Person; Willfulness.

Michael E. Shaff, Irvine Venture Law Firm, LLP, Irvine, CA. 

S. Starling Marshall, Trial Attorney, Court of Federal Claims Section, Tax

Division, United States Department of Justice, Washington, D.C. for the defendant. With 

her were Brian J. Sullivan, Trial Attorney; Court of Federal Claims Section; G. Robson 

Stewart, Assistant Chief, Court of Federal Claims Section, David I. Pincus, Chief, Court 

of Federal Claims Section and Caroline Ciraolo, Deputy Principal Deputy Assistant

Attorney General, Tax Division, United States Department of Justice.

O P I N I O N

HORN, J.

The plaintiff, Mark V. Noffke, brought suit in the United States Court of Federal 

Claims to recover funds for all four quarters of 2009, after the Internal Revenue Service 

(IRS) determined that plaintiff was a responsible person to pay employment taxes for 

BOOMj.com, Inc. (BOOMj),1 and “plaintiff paid the trust fund portion of the employment 

tax for one employee for the first, second, third and fourth quarters of 2009 for BOOMj.” 

Mr. Noffke seeks the refund of the employment taxes paid, and the government has 

counterclaimed for the unpaid portions of the assessments. A trial was held and posttrial briefings on the legal and factual issues raised in the case were filed by both parties. 

After a review of the trial testimony, the exhibits entered into the record, and the 

submissions filed by the parties, the court makes the following findings of fact. 

 

1 As the parties have stipulated, “BOOMj changed its name to ‘Beyond Commerce, Inc.’ 

in December of 2008, but continued to be referred to as ‘BOOMj’ and ‘Beyond 

Commerce.’” As the parties typically refer to the corporation as BOOMj, the court also 

does so in this opinion, unless quoting from a document or the trial transcript. 
2

FINDINGS OF FACT

The plaintiff, Mark J. Noffke, has been a certified public accountant since 1980.2

At trial, plaintiff explained that:

I’m an accountant, CPA. I’ve been in the accounting industry since 1977. 

I’ve run public companies. I’ve been involved with many types of 

transactions, start-ups, but the majority of the start-ups I’ve been involved 

with are companies that deal in the public arena. I’ve gone through a lot of 

various transactions in the various businesses that we've dealt with.

In addition to being a certified public accountant, plaintiff testified that he also has been 

the chief financial officer of a number of corporations.3 Specifically, plaintiff testified: “I 

was the chief financial officer for the forest division of Stone Container. That company 

then was spun off in 1996 . . . and I was the CFO of the U.S Forest Industries. Their 

revenue was around $300 million, about 600 employees throughout that region.” The 

parties have stipulated that “[a]s CFO of U.S. Forest Industries from 1996 to 2002, 

plaintiff’s group was responsible for ensuring that employment taxes were deposited.” In 

addition, plaintiff served as Chief Financial Officer of National Storm Management, and 

the parties also have stipulated that “[a]s CFO of National Storm Management from 2004 

and 2005, plaintiff had responsibility for ensuring that payroll taxes were paid.” 

After serving as Chief Financial Officer of BOOMj,4 plaintiff testified, “I’ve been the 

chief financial officer of a company just recently that I resigned from, a company called 

EFactor. And presently I'm the -- the chief financial officer of a company called Flying 

Food Fare, Inc., which is an airline catering business based in Chicago.” In sum, plaintiff 

testified that he has served as chief financial officer of seven different companies. 

Regarding BOOMj, the parties have stipulated that Mr. Noffke “became CFO and 

 

2 The court notes that, although the parties have stipulated that Mr. Noffke has been a 

certified public accountant since 1980, during the trial, Mr. Noffke testified that he has 

been a certified public accountant “since 1981,” and, as of 2016, that he had been in the 

accounting business for “a little bit more” than thirty years,” which is inconsistent with his 

testimony that he has “been in the accounting industry since 1977.” Although the fact that 

Mr. Noffke is a certified public accountant is relevant to the court’s determination, as are 

his years of experience, neither the precise year he was certified as a public accountant, 

nor the exact number of years he has been involved in the accounting industry are 

important. 

3 Although not discussed at trial, the parties also have stipulated that “Plaintiff has an 

accounting bachelors’ degree and has taken post-graduate management courses at 

Northwestern University [sic] and Emory University’s business schools.” 

4 As discussed further below, after BOOMj ceased operations in 2009, a subsidiary of 

BOOMj, Kaching Kaching, Inc., purchased certain assets of BOOMj for 20.8% of the 

shares of common stock of Kaching Kaching, Inc., and plaintiff became the Chief 

Financial Officer of Kaching Kaching, Inc. 
3

executive vice-president of BOOMj.com, Inc., an online services company aimed at babyboomers in 2007.” (internal reference omitted). Regarding the beginning of his 

employment, Mr. Noffke testified at trial on cross-examination:

Q. Now, you -- when BoomJ began, came into existence, you were one of 

the original members of the executive team; is that right?

A. That’s correct.

Q. And Mr. McNulty was as well.

A. That's correct.

Q. But was Mr. -- you were -- you were issued stock; is that right?

A. At a point in time, correct.

Q. Okay. At the beginning of the company’s existence.

A. That's correct.

In response to the question on cross-examination, “when you took on this -- this role as 

CFO of -- of BoomJ, did you understand that that was a potential -- that -- that a role such 

as that could carry a potential personal liability should there be nonemployment --

nonpayment of employment taxes?” Mr. Noffke answered: “Yes, I did.”

Regarding the formation of BOOMj, plaintiff testified: 

BoomJ was formed in 2006 as an offshoot of a company called Financial 

Media Group. The company was a private company until 2007 when it did 

what was called a reverse merger[

5

] with -- with what's called a shell 

company. A shell company is a company that is set up for public reporting. 

It's gone through the SEC. It has received the various blessings that it can 

be a publicly reporting company which requires three years of audited 

financial statements and various disclosure documents on a business plan. 

Well, this company had basically come into what was called a shell status, 

did not have any liabilities on it. And what we did is we exchanged stock 

within BoomJ for the stock of this public entity. This entity, then we changed 

its name then to BoomJ, and then further changed it to a company called 

Beyond Commerce.

Mr. Noffke testified that “[i]nitially I owned a million shares of BoomJ as the private 

company. That was then converted into -- it was a reverse merger of 2.02, so converted 

into 2,200,000 shares. . . .” 

 

5 Mr. Noffke subsequently testified that “[t]he reverse merger took place sometime during 

the period of -- of 2007.” 
4

Explaining the relationship between the various entities, Mr. Noffke testified that:

Beyond Commerce is the public vehicle that was the trading vehicle where 

the stock was. BoomJ.com is a subsidiary 100 percent owned by Beyond 

Commerce. Beyond Commerce actually owned 100 percent of Local Ad 

Link, the I Supply company,[

6

] and two other facilities or entities. But the 

ultimate parent was Beyond Commerce that owned all these other various 

companies.

Mr. Noffke served as Chief Financial Officer of BOOMj, Beyond Commerce, and Local Ad 

Link. Mr. Noffke testified that he was “secretary-treasurer at a point in time” of BOOMj 

and the various entities. In response to the question: “Were you executive vice president 

and chief financial officer of each of those entities?” Mr. Noffke replied:

I was most likely the treasurer-secretary of each one of those entities not 

necessarily the CFO, but that legal capacity.

Q. Were you -- were you CFO of any of these entities? I thought --

A. I don’t believe there was a CFO for those positions, and we were just --

again, these were legal entities, and so whatever legal entity it required, 

that's what position I was for that. Again, being Beyond Commerce and CFO 

of the holding company and owning 100 percent of the stock of each one of 

these.

Q. So you were CFO of Beyond Commerce, and were you CFO of BoomJ 

as well?

A. That’s correct.

Q. Okay. And then for Local Ad Link and I Supply, you’re just saying you 

don't know what was legally required for them --

A. Whatever was legally required, whether it was a treasurer or just -- I was 

either treasurer or secretary of that -- of those entities.

Q. What about executive vice president? Were you executive vice president 

of any of those entities?

A. Not to my knowledge.

Robert McNulty started BOOMj, and testified that, initially, he served as “the 

chairman of the company, nonexecutive chairman.” Mr. McNulty explained that in his role 

as nonexecutive chairman, “[p]rincipally I worked on the side of the business which was 

the business strategy, business model, and, you know, the direction of the company from 

 

6 The name of the entity is iSupply. 
5

that standpoint, and then raising capital for the company.” Mr. McNulty testified that 

“George Pursglove was the CEO, and Mark Noffke was the CFO” of BOOMj. Mr. 

Pursglove testified that he was the Chief Executive Officer and President of BOOMj. Mr. 

Pursglove also testified that he formed BOOMj with Mr. McNulty and “the first file I set up 

on BoomJ was October 1st, 2006.” Ultimately, Mr. McNulty became Chief Executive 

Officer of BOOMj after Mr. Pursglove left BOOMj in October 2007.

7 Mr. McNulty described 

his management style by stating:

I’m very direct, you know. Some people think I'm a tough guy to work for. 

Some people think I'm not so tough to work for. If you do your job, guess 

what, I'm the easiest guy in the world to work for. If you don't do your job, 

you probably won't be here very long. 

The parties have stipulated that “Mr. McNulty had been subject to a sanction by the 

Securities and Exchange Commission (SEC) as a result of not disclosing an intercompany transfer to the SEC and that, as a result, Mr. McNulty could not serve as the 

chairman of the board of a public reporting company.”8

The parties also have stipulated that Mr. Noffke had check signing authority on all of 

BOOMj’s bank accounts, as well as on all BOOMj’s subsidiaries’ bank accounts, and Mr. 

Noffke testified to the same at the trial.9 Mr. Noffke also testified that, in addition to hand 

signing checks, BOOMj had a check signing machine with Mr. Noffke’s signature, and 

that was with “what the majority of the checks were written.” The parties have stipulated 

 

7 Despite parting from BOOMj nine years before the trial, Mr. Pursglove and Mr. McNulty 

continue to have a strained relationship. In response to a question about Mr. McNulty’s 

honesty, Mr. Pursglove stated that “He [Mr. McNulty] wouldn't know how to spell it, No. 1, 

and he wouldn't know honesty if it was staring him in the face, and he wouldn't know it 

was honesty if St. Peter himself was delivering it to him.” Mr. McNulty, for his part, testified 

regarding Mr. Pursglove: 

He resigned from the company. I mean, I saw a significant difference in his 

attitude over a period of maybe a quarter or so. You know, in raising capital, 

things don't work. But at the end of the day, you know, you either believe in 

the business, get committed and go forward, or don't. At some point, he [Mr. 

Pursglove] decided that to leave the company, wasn't in his best interest to 

stay there. However, shortly after he left, I found that he was actually 

working on a plan to compete with our business model and -- and had 

reached out to people to raise capital and things like that. 

8 The parties also stipulated that “[a]t BOOMj, the lawyers the company hired researched 

Mr. McNulty’s restrictions and determined that he could serve as chairman of the board.”

9 Mr. Noffke indicated that for a time, he may have been the only individual with check 

signing authority at BOOMj. He testified: “I don’t recall who else may have been added. I 

might have just been the sole one at a point in time. So I really don’t recall. . . .” 
6

that Mr. McNulty did not have check signing authority on BOOMj’s bank accounts.10 On 

cross-examination, defendant’s counsel asked Mr. Noffke why he did not simply write a 

check to the IRS to the cover the requisite taxes, to which he responded:

First of all, I didn't have the authority to do that. I mean--and, frankly, why 

am I doing that? It's a personal obligation I'm taking care of. That's almost-

-you know, that's determinative embezzlement almost, because it was 

outside of my authority. And most likely would have only taken care of--it 

would have bounced. It was--the funds were very, very tight. There was not 

a million dollars sitting in the account at any point in time. There was only 

amounts--the amounts that were in the checking account, there were 

checks that were already issued for that.

Mr. McNulty testified, in response to the question, did Mr. Noffke have the authority to 

write a check to the IRS, “I mean, the question really shouldn’t be does he have authority. 

Of course he has authority to write a check. It’s, you know, who's telling him to pay them 

or not telling them to pay.”11 Regarding his ability to make payments to the IRS that Mr. 

McNulty did not approve, Mr. Noffke testified:

Well, first of all, I didn't have the authority to do that. And could have -- you 

can say that I was embezzling money to take care of my personal liability 

with the IRS. It would not cover the full debt that we were owed, and it would 

handle a certain portion of that. And the -- the liability would still be -- there 

would still be a -- a liability out there, maybe reduced by whatever money I 

was able to hypothetically write to.

Joanne Stiff12 testified that, as “an officer of the company,” Mr. Noffke had the 

authority to open and close bank accounts. The parties also have stipulated that “Plaintiff 

opened and closed bank accounts, merchant credit card holding accounts, credit cards 

and other financial accounts on behalf of BOOMj” and that “Plaintiff had the ability with 

respect to its banks to direct electronic transfers from BOOMj and its subsidiaries’ bank 

accounts.” The parties further stipulated that “Plaintiff negotiated settlements with 

 

10 At trial, Mr. McNulty was asked is “there a reason that you were not a signer on the 

BoomJ checking account?” and Mr. McNulty replied: “No, not particularly.” Mr. McNulty 

further explained: “I mean, I didn't control it from writing the check, but I controlled it from 

discussing issues with Mark [Noffke] and directing them who should get paid and who 

shouldn't get paid.” 

11 The parties have stipulated that “Plaintiff and Mr. McNulty authorized payroll at BOOMj.” 

12 Regarding Ms. Stiff, Mr. Noffke testified that “she actually did the payroll, was 

responsible for the filing of the payroll taxes, the reporting of the payroll taxes, the actual 

entry of some of the accounts payable, and the supervision of some of the accounts 

payable functions, the actual generation of the check, printing or preparing a check.” 

Moreover, the parties have stipulated that “plaintiff hired Joanne Stiff to manage BOOMj’s 

accounts payable, payroll, bank reconciliations and other functions.” 
7

creditors and former employees on behalf of BOOMj.” Mr. Noffke testified that “[t]he 

accounting department reported up through me” and that he had hired, and subsequently 

fired, at least one individual. Mr. Noffke hired Patricia Hill to be corporate controller of 

BOOMj in 2007, and she remained in that role until he fired her 2009. Moreover, Mr. 

Noffke also had extensive responsibilities regarding BOOMj’s public reporting with the 

Securities and Exchange Commission. Plaintiff testified, “I would estimate basically 80 

percent of my duties were in the public reporting framework.” 

The parties stipulated that “[f]rom its inception, BOOMj experienced peaks and 

valleys of funding and cash flow was an issue,” and that “[i]n 2008, plaintiff was aware 

that BOOMj had not made complete and timely employment tax deposits with the United 

States government.” Mr. Noffke sent the IRS a letter on March 9, 2009, “requesting an 

abatement of the penalties charged for the reasons of hardship and former disgruntle [sic]

employees.” In his letter to the IRS, Mr. Noffke stated that the former employees 

did not file the required documents or pay the payroll taxes, as it was 

assured to me by the Accounting Manager. Boomj has subsequently filed 

all 941 tax forms for the third and fourth quarter [of 2008]; however, our 

business was suffering at this point in time. Our business structure is based 

on e-commerce and with the slowness of the economy, our revenues have 

lowered.

The parties also stipulated that “[t]he 2008 employment tax liabilities were eventually 

paid.” Mr. Noffke testified that after the 2008 employment tax liabilities were paid, changes 

were made to the accounting department, specifically, “[t]he changes were that we started 

putting that up in front as an item to be paid versus prior to that, it was understood when 

you made payroll, you made -- you -- that was including payroll taxes.” On crossexamination Mr. Noffke testified that:

Q. And then from that point on, there was a discussion of that [employment 

tax liabilities].

A. That's correct.

Q. And -- but from that point on, you understand that in '09, none of the 

quarters were -- the obligation was fully met.

A. That's correct. But they were presented again to -- to Bob McNulty to 

make that call whether to make those payments or not. So that was -- if you 

want to say a change, there was a change. It was a change that identified 

that these are certain obligations that need to be paid now.

In 2009, BOOMj faced similar issues regarding timely employment tax deposits 

with the United States government. On cross-examination, defendant’s counsel had the 

following exchange with Mr. McNulty:
8

Q. [D]uring 2009 when there were these issues with capital infusions and 

there were payroll taxes that -- liabilities that were going unpaid, you -- you 

did continue to make payroll to your employees.

A. Yes.

Q. And Mr. Noffke was aware of that.

A. Yes.[

13]

Mr. McNulty testified, in response to the question, “[s]o were there more than -- there was 

more than one conversation with Mr. Noffke about the fact that IRS was going to go 

unpaid,” that:

Yeah. And we always thought we were going to get money and going to pay 

it. But never came in. We were always short and, you know, you have to 

have kind of a -- and I know there's no excuse in the law, but you have to 

have an optimistic view to build these companies or you wouldn't be doing 

them. So you promise that you're going to have funding done. It doesn't 

happen.

In explaining the process for not making the required payments to the IRS, Mr. 

McNulty explained:

Mark [Noffke] informed me on all payables, whether it’s, you know, payroll 

taxes or whatever it might be. In this specific case, the sequence of events 

was pretty straightforward. Joanne [Stiff] came to me and said, hey, we 

have -- you know, we have an obligation to pay, you know, taxes, and we 

have an obligation for payroll, but we’re going to be short. What should we 

do? And I said, you know, go ahead and, you know, pay the payroll, hold 

the taxes, and I’ll call Mark. And I called Mark and told him here’s where we 

are. OmniReliant’s[

14] committed to put money in, we're about a week away 

from putting cash in, and, you know, if -- if you miss a payroll 1099, and --

you know, sales reps, you start to destroy your business, so -- and we were 

ramping the business up so we had significant payroll to make. So I had a 

choice to make. And, you know, they were reluctant to -- to go along with it 

obviously because of the liability issue. But I just said, Look, we -- you know, 

it’s a decision I have to make. And, you know, we need to pay payroll. It's 

that simple. And they were not happy with it, particularly Mark. I remember 

talking to him on the phone.

 

13 The joint exhibits include an IRS Form 433-B, which reflects that Mr. Noffke was 

“Responsible for Depositing Payroll Taxes.” 

14 OmniReliant was an investor in BOOMj. After BOOMj experienced financial difficulties, 

Local Ad Link was sold to a subsidiary of OmniReliant. 
9

Thereafter, plaintiff’s counsel asked Mr. McNulty: 

Q. And he [Mr. Noffke] expressed his views that the -- the federal 

employment taxes should be paid[.]

A. Yes, he did.

Q. Yet they were not.

A. Correct. It's my responsibility. It's just that simple.

After acknowledging that Mr. Noffke was upset that the employment tax liabilities were 

not being paid, Mr. McNulty had the following exchange with defendant’s counsel:

Q. Did he [Mr. Noffke] ever threaten to just issue a payment to the IRS for 

the unpaid obligations?

A. No.

Q. Did he ever threaten to quit and resign his position?

A. He didn’t threaten to quit, but he made it pretty clear that he was very 

unhappy about it.

Q. And did –

A. Mark’s not the kind of guy that just relinquishes and rolls over. You know, 

he felt there was a real responsibility to the company. If he left, who's going 

to run it from that standpoint? I can't run the accounting department.

Mr. McNulty expressed surprise that Mr. Noffke, and not himself, was the individual the 

IRS assessed the trust fund recovery penalties against, testifying, “[f]rankly, I assumed 

that the government was coming after me,” and “I never thought they were going after 

Mark. And they didn't. They didn't come after me, which surprised me.” 

Mr. Noffke also discussed the conversations he had with Mr. McNulty about not 

paying the employment tax liabilities with defendant’s counsel: 

Q. we’ve talked a lot today about Mr. McNulty and what he would say to you 

when you would have these conversations about wanting to pay the

employment tax liabilities, and I think you said he was always saying that 

money was just around -- around the corner; is that right?

A. That’s correct.
10

Q. And this is referring -- you heard how many times in your work with Mr. 

McNulty?

A. Many -- many times.

Q. Over the course -- I guess beginning in 2008 when you first --

A. Beginning in 2008 when we first incurred missing the payroll liability the 

first time. And actually that happened in 2008, the promise was fulfilled. We 

were able to pay those payroll taxes in 2008 in 2009.

Q. Right. But the same was not true of the employment tax liabilities 

incurred in 2009.

A. That's correct.

Mr. Noffke discussed the non-payment of federal taxes further with plaintiff’s counsel:

Q. Would you say that you urged Mr. McNulty to pay the federal 

employment taxes?

A. Yes, I would.

Q. How often would you urge him to pay the federal employment taxes?

A. It was front and center every time he received one of our sheets.

Q. And how often was that?

A. Traditionally weekly. We tried to make payments on Fridays.

. . . 

Did the tenor of your discussions with Mr. McNulty change from the 

beginning of 2009 to the end of 2009 regarding employment taxes?

A. Yes, it did.

Q. Would you tell the Court.

A. It got a little bit more intense because of -- the dollar amount was getting 

extremely high. And Bob [McNulty] -- again, it's always the next deal. We 

heard him talk about, I would do this again. I -- you know, he -- he's still 

believe -- I mean, I'm looking at more realistic. I'm looking at what are our 

liabilities and how do you take care of the various vendors, suppliers, 

payroll, you know, trust fund obligations to -- basically to the point of, you 

know -- you know, is this money ever going to come in? When does it stop?
11

On November 2, 2009, the IRS sent BOOMj a notice regarding the first quarter of 

2009, which stated in part: 

Our records indicate that you haven’t paid the amount you owe. The law 

requires that you pay your tax at the time you file your return. This is your 

notice, as required by Internal Revenue Code Section 6331(d), of our intent 

to levy (take) any state tax refunds that you may be entitled to if we don’t 

receive your payment in full. In addition, we will begin to search for other 

assets we may levy. We can also file a Notice of Federal Tax Lien, if we 

haven’t already done so.

At the end of 2009, BOOMj “ceased operations and no longer had employees.” 

The parties have stipulated that “[a]t the end of 2009, Mr. McNulty set up an arrangement 

whereby a subsidiary of BOOMj, called Kaching Kaching, Inc. (‘KCKC’) purchased certain 

assets of BOOMj for 20.8% of the shares of common stock of KCKC.” Mr. Noffke became 

the Chief Financial Officer of Kaching Kaching, Inc. and Mr. McNulty became the Chief 

Executive Officer.15

In February 2010, Mr. Noffke sent a letter to President Obama requesting the 

president “waive any back taxes due and allow the officers clemency on any personal 

obligations.” Mr. Noffke explained that:

Beyond Commerce, Inc. during 2009 embarked on an incredibly complex 

and significant transformation as we fundamentally shifted our business 

model from a social-shopping portal to a local advertising and e-commerce 

company. During the first quarter of 2009 at our peak we had over one 

hundred salary individuals and over 35,000 independent sales 

representatives selling local advertising on the internet through our Local 

Ad Link, Inc. LocalAdLink was an online business directory selling ads to 

small and medium size business [sic] along with user generated customer 

reviews and placing the ads on Internet search engines Google, Yahoo, and 

Bing.com.

Mr. Noffke also explained in his letter that: 

However, the Company began going through some very difficult times over 

the next several months. The downturn can be pinpointed to when the 

Company was put into a negative position as the Company’s credit card 

merchant cut off its processing just as we were ramping up. The processor 

withheld much needed cash that forced the Company off line. As a result, 

this put the Company in a position where it was unable to pay on a timely 

 

15 Although not an issue currently before this court, Kaching Kaching, Inc. also failed to 

pay the employment tax liabilities for the tax period ending on December 31, 2010, and 

the IRS assessed Mr. Noffke with a trust fund recovery penalty for that failure. As 

indicated below, prior to trial, the parties resolved their dispute regarding the 2010 fourth 

quarter tax liabilities for Kaching Kaching, Inc.
12

basis its independent representatives. This subsequently pushed the 

Company into a slow downward spiral.

Mr. Noffke continued:

Needless to say payroll taxes were neglected as we were always trying to 

take care of the field sales representatives and our own employees with the 

anticipation that the next round of funding or increase in sales could take 

care of the taxes. The Company Officers did not divert funds or any malice, 

just invested it back into the business’s human assets. I have not received 

a paycheck for close to four months, have lost all my stock in the company 

as it was foreclosed on in repayment of a loan, all this as we try to 

reinvigorate our business.

Mr. Noffke sent the IRS another letter in March 2010, referencing a conversation between 

the IRS and Ms. Stiff, which indicated

in the conversation, you were informed that Boomj has not paid payroll for 

December 2009 and for first quarter 2010. We are in financial hardship and 

are trying to raise capital for operational needs. We have had to lay off 

approximately 80% of our staff. At the beginning of 2009, we had a little 

over 100 employees; we are now operating with about 12-15. Boomj is 

currently in re-organizing and rebuilding our business model to start bringing 

in additional revenues as well as capital fund raising. At the moment, 

Boomjcom's revenues are approximately $3,000.00 gross monthly.

The IRS continued to seek information about the unpaid payroll taxes and Mr. 

Noffke testified that he brought in an accounting firm to help BOOMj work with the IRS, 

and in an April 20, 2010 email, a tax manager with the accounting firm requested Mr. 

Noffke provide a list of monthly income, personal expenses, and a complete Form 4180. 

The parties have stipulated that “Plaintiff signed a Form 4180 interview form regarding 

his role at BOOMj and his knowledge of the unpaid liabilities on May 18, 2010.” The Form 

4180 which is titled: “Report of Interview with Individual Relative to Trust Fund Recovery 

Penalty or Personal Liability for Excise Taxes,” asked a series of questions under the 

heading “Responsibility” and stated: “Please state whether you performed any of the 

duties / functions listed below for the business and the time periods during which you 

performed these duties.” The questions included: “Determine financial policy for the 

business?” “Direct or authorize payments of bills/creditors?” “Open or close bank 

accounts for the business?” “Sign or counter-sign checks?” “Authorize payroll?” 

“Authorize or make Federal Tax Deposits?” and “Hire/Fire?” All of the above questions 

were answered in the affirmative, as well as the question: “During the time the delinquent 

taxes were increasing, or at any time thereafter, were any financial obligations of the 

business paid,” with the explanation: “Standard operational expenses to keep company 

in business.” In response to the question: “Who authorized them to be paid?” the Form 

4180 stated: “Mark Noffke.”
13

The parties have stipulated that “[o]n September 20, 2010, the IRS assessed 

penalties against plaintiff Noffke of $91,252.54 for the first quarter, $208,618.99 for the 

second quarter, $179,570.87 for the third quarter, and $102,642.10 for the fourth quarter.”

On January 12, 2011, plaintiff paid the trust fund portion of the employment tax for one 

employee for the first, second, third and fourth quarters of 2009 for BOOMj, and on the 

same day, January 12, 2011, plaintiff filed claims for refund for all four quarters of 2009.

The parties have stipulated that “[t]he IRS had not taken any action on these claims as of 

the date of filing the complaint in this action.” 

Defendant’s counterclaim, discussed below, indicated that “plaintiff was assessed 

a trust fund recovery penalty, pursuant to Internal Revenue Code § 6672, in the amount 

of $15,402.37. The assessed amount corresponds to a portion of unpaid employment tax 

obligations of Kaching Kaching Inc. for the tax period ending on December 31, 2010.” 

Subsequently, plaintiff paid the trust fund portion of the employment tax for one employee 

for the fourth quarter of 2010 for Kaching Kaching Inc., and filed a claim for refund on 

October 7, 2013. The defendant also indicated that the IRS has not issued a denial of the

claim for refund. 

On February 6, 2014, plaintiff filed the above captioned case in the United States 

Court of Federal Claims and sought a “refund of the claimed overpaid federal taxes in the 

amount of $1,541.69 plus interest,”16 as well as a determination by the court “that Plaintiff 

is not a responsible person within the meaning of 26 USC §6672(a).” On June 6, 2014,

defendant filed an answer and a counterclaim seeking “judgment against plaintiff in the 

amount $102,642, plus assessed interest, minus amounts credited by the IRS against 

plaintiff’s § 6672 assessment for the tax periods ending on March 31, 2009, June 30,

2009, September 30, 2009, and December 31, 2009, plus interest and costs allowed by 

law.” On August 7, 2014, plaintiff filed an amended complaint, and in addition to seeking 

a “refund of the claimed overpaid federal taxes in the amount of $1,541.69 plus interest 

with respect to the four quarters of trust fund recovery penalty with respect to Boomj.com,” 

plaintiff sought a “refund of the claimed overpaid federal taxes in the amount of $303.40 

plus interest with respect to the trust fund recovery penalty with respect to KaChing 

KaChing for the fourth quarter of 2010.” Prior to trial, the parties resolved their dispute 

regarding the 2010 fourth quarter tax liabilities for Kaching Kaching, Inc. 

 

16 Although plaintiff sought a refund in the amount of “$1,541.69 plus interest,” in plaintiff’s 

“Statement for Refund Claim,” included as an exhibit to the complaint, plaintiff claimed 

“[t]he Taxpayer has paid $1,533, representing the withholding for one employee for each 

Quarter.”
14

DISCUSSION

The parties agree that the issue to be resolved is “whether or not plaintiff is liable 

for the trust fund recovery penalties assessed by the IRS against plaintiff pursuant to 

Section 6672 for the four quarters of 2009, relating to the unpaid employment taxes of 

Beyond Commerce, Inc.” As recently explained by the United States Court of Appeals for 

the Federal Circuit:

Although the United States, as a sovereign, is generally immune from suit, 

28 U.S.C. § 1346(a) provides the limited waiver of sovereign immunity for 

refund suits:

(a) The district courts shall have original jurisdiction, concurrent with the 

United States Court of Federal Claims, of:

(1) Any civil action against the United States for the recovery of any internalrevenue tax alleged to have been erroneously or illegally assessed or 

collected, or any penalty claimed to have been collected without authority 

or any sum alleged to have been excessive or in any manner wrongfully 

collected under the internal-revenue laws. . . .

The Tucker Act, which gives the Claims Court jurisdiction over suits for 

which the United States has waived its sovereign immunity, provides the 

Claims Court with jurisdiction for refund suits. 28 U.S.C. § 1491; Shore v. 

United States, 9 F.3d 1524, 1525 (Fed. Cir. 1993); Rocovich v. United 

States, 933 F.2d 991, 993 (Fed. Cir. 1991).

Diversified Grp. Inc. v. United States, 841 F.3d 975, 981 (Fed. Cir. 2016). 

As noted above, Mr. Noffke has paid the “trust fund portion of the employment tax 

for one employee for the first, second, third and fourth quarters of 2009 for BOOMj.” 

Generally, “payment of the assessed taxes in full is a prerequisite to bringing a refund 

claim.” Ledford v. United States, 297 F.3d 1378, 1382 (Fed. Cir. 2002) (citing Flora v. 

United States, 362 U.S. 145, 177, reh’g denied, 362 U.S. 972 (1960); Rocovich v. United 

States, 933 F.2d 991, 993–94 (Fed. Cir. 1991)); see also Shore v. United States, 9 F.3d 

1524, 1527 (Fed. Cir. 1993) (“The Flora [v. United States, 362 U.S. 145] full payment rule 

requires that taxpayers prepay the tax principal before the Court of Federal Claims will 

have subject matter jurisdiction over their tax refund action under § 1491.”). The Federal 

Circuit in Diversified Group echoed this sentiment, noting that “[i]n Flora, the Supreme 

Court determined that § 1346(a)’s jurisdictional grant includes a ‘full payment 

requirement,’ which demands—as a jurisdictional prerequisite—full payment of the tax or 

penalty before a party could sue for a refund.” Diversified Grp. Inc. v. United States, 841

F.3d at 981 (quoting Flora v. United States, 362 U.S. at 177). There is, however, an 

exception to this rule for divisible taxes, such as those levied under 26 U.S.C. § 6672

(2012). See 26 U.S.C. § 6331(i)(2)(B) (2012) (defining divisible taxes to include “the 

penalty imposed by section 6672”). Under this exception, “a taxpayer assessed under 

section 6672 need only pay the divisible amount of the penalty assessment attributable 
15

to a single individual’s withholding before instituting a refund action.” Boynton v. United 

States, 566 F.2d 50, 52 (9th Cir. 1977); see also Steele v. United States, 280 F.2d 89, 91 

(8th Cir. 1960).17 The rationale for this exception is that “section 6672 assessments 

represent a cumulation of separable assessments for each employee from whom taxes 

were withheld.” Boynton v. United States, 566 F.2d at 52. Thus, in the past, courts have 

permitted 26 U.S.C. § 6672 refund cases to proceed when the taxpayer has prepaid the 

IRS an amount equal to one employee’s withholding for one quarter. See Godfrey v. 

United States, 748 F.2d 1568, 1573 (Fed. Cir. 1984) (noting that the United States Claims 

Court had allowed the case to proceed after each plaintiff paid $150.00 to the IRS, “the 

amount in excess of income and FICA taxes withheld from one employee”);18 see also

Kennedy v. United States, 95 Fed. Cl. 197, 200 (2010) (noting plaintiff had prepaid 

$476.15 to the IRS, “representing the portion of the assessment relating to one employee 

for the fourth quarter of 2000”). Furthermore, defendant has not challenged the propriety 

of Mr. Noffke seeking a refund after only paying a portion of the taxes owed. In light of 

the decisions allowing partial payment for a case regarding 26 U.S.C. § 6672, the court 

believes it is proper for the court to consider Mr. Noffke’s claim on the merits. As 

defendant has not raised any other jurisdictional challenges to Mr. Noffke’s suit, the court 

addresses the merits of plaintiff’s tax refund claim.

26 U.S.C. § 6672

The Tax Code at 26 U.S.C. § 6672(a) states, in part:

Any person required to collect, truthfully account for, and pay over any tax 

imposed by this title who willfully fails to collect such tax, or truthfully 

account for and pay over such tax, or willfully attempts in any manner to 

evade or defeat any such tax or the payment thereof, shall, in addition to 

other penalties provided by law, be liable to a penalty equal to the total 

 

17 The genesis of the exception is dicta in Flora v. United States stating that “excise tax 

assessments may be divisible into a tax on each transaction or event, so that the fullpayment rule would probably require no more than payment of a small amount.” Flora v. 

United States, 362 U.S. at 175 n.38; see also Steele v. United States, 280 F.2d at 90 

(citing Flora v. United States, 362 U.S. at 171 n.37, 175 n.38).

18Although the Federal Circuit considered the issue of the “divisibility exception” to Flora’s

full payment rule, and noted that “divisibility remains a ‘narrow exception,’” Diversified 

Grp. Inc. v. United States, 841 F.3d at 982, in that case, the Federal Circuit addressed 

the issue of the divisibility exception in the context of the IRS conducting a penalty audit, 

pursuant to 26 U.S.C. § 6707, for the failure to register a tax shelter under 26 U.S.C. 

§ 6111, and did not address 26 U.S.C. § 6672. See Diversified Grp. Inc. v. United States, 

841 F.3d at 985 (determining the penalty assessed pursuant to 26 U.S.C. § 6707 is not 

divisible). A seminal case decided by the Federal Circuit regarding 26 U.S.C. § 6672, 

Godfrey v. United States, 748 F.2d 1568, did not address if partial payment was a 

jurisdictional bar to deciding the case, but reached a decision on the merits, despite 

plaintiff having paid the taxes only “withheld from one employee.” Id. at 1573.
16

amount of the tax evaded, or not collected, or not accounted for and paid 

over.

26 U.S.C. § 6672(a); see also Gann v. United States, 128 Fed. Cl. 394, 395 (2016). By 

way of background, a Judge of the United States Court of Federal Claims explained:

A short explanation of the payroll tax system is useful to place the 

applicability of section 6672 in context. Under the Federal Tax Deposit 

System, every employer is required to withhold Federal Insurance 

Contributions Act (FICA) tax from employees’ wages “as and when” they 

are paid. 26 U.S.C. §§ 3102, 3402(a) (2000). These withholding funds are 

used primarily to pay the taxpayers' individual income tax as well as Social 

Security and Medicare benefits. Instead of paying the federal government 

directly, employers deposit the withheld funds with an authorized financial 

institution such as a commercial bank until they are collected by the U.S.

Treasury. INTERNAL REVENUE SERVICE, PUBLICATION 15, 

CIRCULAR E, EMPLOYER'S TAX GUIDE (2003). These funds are 

deposited along with a Federal Tax Deposit (FTD) coupon listing the 

employer's name, address, and Employer Identification Number (EIN), 

which allows the IRS to earmark and track the deposits. Id. Under the 

Internal Revenue Code, the deposited withholdings “shall be held to be a 

special fund in trust for the United States.” 26 U.S.C. § 7501(a). Hence, the 

withheld taxes are commonly referred to as “trust fund taxes,” although the 

trust established is somewhat different than a traditional common law trust. 

INTERNAL REVENUE SERVICE, SMALL BUS/SELF–EMPLOYED, 

BUSINESS WITH EMPLOYEES, TRUST FUND TAXES (2003). These 

trust fund tax deposits are accounted for by the IRS on a quarterly basis 

through the use of a tax return form known as “Form 941.” Employers must 

file Form 941 within one month from the end of the prior quarter, and 

penalties are assessed for late filings. Id. More importantly for the purposes 

of this case, however, employers are liable under 26 U.S.C. §§ 3102(b) and 

3403, for the payment of these trust fund taxes once they pay employees 

only their net wages. Id. It is this liability that section 6672 enforces.

Farkas v. United States, 57 Fed. Cl. 134, 139 (2003), aff’d, 95 F. App’x 355 (Fed. Cir. 

2004) (capitalization in original; footnotes omitted). The Farkas court noted that “Section 

6672 holds delinquent employers personally responsible for 100% of the amount withheld 

from their employees.” Id. As indicated in Jenkins v. United States, “[i]n imposing the 

obligation to collect these taxes on other than the actual taxpayer, Congress recognized 

that collectors might fail to set aside and pay over the taxes to the United States,” and in 

cases where “the collector fails to remit the withheld taxes, the United States must, 

nevertheless, credit each taxpayer as if the funds were actually paid over.” Jenkins v. 

United States, 101 Fed. Cl. 122, 130 (2011), aff’d, 484 F. App’x 511 (Fed. Cir. 2012). “To 

protect against such losses, the persons responsible for ensuring that the trust fund taxes 

are paid, who willfully fail to do so, may be held personally liable under section 6672 of 

the Code.” Jenkins v. United States, 101 Fed. Cl. at 130; see also Waterhouse v. United 

States, 122 Fed. Cl. 276, 283 (2015).
17

As explained by the Federal Circuit in Godfrey v. United States:

The purpose of the 100 percent penalty provision “is to permit the taxing 

authority to reach those [persons] responsible for the corporation's failure 

to pay the taxes which are owing.” White v. United States, 372 F.2d 513, 

516, 178 Ct. Cl. 765 (1967). Though the legislative history is uninformative, 

“it is evident from the face of the section that [§ 6672] was designed to cut 

through the organizational form and impose liability upon those actually 

responsible for an employer's failure to withhold and pay over the tax.” See

Pacific National Insurance Co. v. United States, 422 F.2d 26, 31 and n.12 

(9th Cir.), cert. denied, 398 U.S. 937, 90 S. Ct. 1838, 26 L. Ed. 2d 269 

(1970). Accordingly, “the section is generally understood to encompass all 

those officers who are so connected with a corporation as to have the 

responsibility and authority to avoid the default which constitutes a violation 

of the particular Internal Revenue Code section or sections involved, even 

though liability may thus be enforced on more than one person.”[

19]

Godfrey v. United States, 748 F.2d at 1574-75 (quoting White v. United States, 178 Ct. 

Cl. 765, 372 F.2d 513, 516 (1967)) (bracket in original). As the Farkas court elaborated: 

“Thus, liability under section 6672 attaches only to those officers or directors with 

sufficient power and authority over the corporation that they may be considered a 

‘responsible person’—i.e., one responsible for withholding the employees’ taxes.” Farkas 

v. United States, 57 Fed. Cl. at 140 (footnote omitted); see also Waterhouse v. United 

States, 122 Fed. Cl. at 283. In Godfrey, the Federal Circuit indicated: 

The term “responsible person” is an invention of the courts, having no 

statutory definition or discussion in the legislative history. As the Supreme 

Court recently noted in Slodov v. United States, 436 U.S. 238, 98 S. Ct. 

1778, 56 L. Ed. 2d 251: “The cases which have been decided under § 6672 

 

19 The Tax Code at 26 U.S.C. § 6103(e)(9) provides that:

Disclosure of certain information where more than 1 person subject to 

penalty under section 6672.--If the Secretary determines that a person is 

liable for a penalty under section 6672(a) with respect to any failure, upon

request in writing of such person, the Secretary shall disclose in writing to 

such person--

(A) the name of any other person whom the Secretary has determined to 

be liable for such penalty with respect to such failure, and

(B) whether the Secretary has attempted to collect such penalty from such 

other person, the general nature of such collection activities, and the 

amount collected.

26 U.S.C. § 6103(e)(9) (2012); see also Jenkins v. United States, 90 Fed. Cl. 585, 586 

n.2 (2009).
18

generally refer to the ‘person required to collect, truthfully account for, and 

pay over any tax imposed by this title’ by the shorthand phrase ‘responsible 

person.’ We use that phrase without necessarily adopting any of the 

constructions placed upon it in the decisions.

Godfrey v. United States, 748 F.2d at 1574 n.4 (quoting Slodov v. United States, 436 U.S. 

238, 246 n.7 (1978)); see also Farkas v. United States, 57 Fed. Cl. at 140 n.7. The Federal 

Circuit in Godfrey concluded that

a person is subject to a 100 percent penalty if he satisfies two separate 

statutory requirements. First, he must be under a duty to “perform the act in 

respect of which the violation occurs,” (§ 6671(b)) and that duty is “to collect, 

truthfully account for, and pay over” any taxes (§ 6672). Such a person is a 

“responsible person”. Second, the “responsible person” must have “willfully” 

failed to collect, truthfully account for, and pay over, or have “willfully” 

evaded or defeated the tax or tax payment. As the Claims Court correctly 

noted, both statutory requirements must be present for the 100 percent 

penalty to be imposed.

Godfrey v. United States, 748 F.2d at 1574 (citing McCarty v. United States, 437 F.2d 

961, 967, 194 Ct. Cl. 42 (1971) (footnote omitted).

Both elements require a fact-specific inquiry by the court. In considering if the 

plaintiff was a responsible person, the court in Waterhouse v. United States stated, “the 

court focuses its factual inquiry into whether the plaintiff had the ‘power to compel or 

prohibit the allocation of corporate funds.’” Waterhouse v. United States, 122 Fed. Cl. at 

283 (quoting Godfrey v. United States, 748 F.2d at 1576). In addition, regarding the 

willfulness requirement, in Gann v. United States, the court stated “[t]he separate 

requirement that a responsible individual also have acted willfully in failing to withhold 

and/or remit the tax also presents a fact-intensive inquiry, calling for ‘proof of a voluntary, 

intentional, and conscious decision not to collect and remit taxes thought to be owing.’” 

Gann v. United States, 121 Fed. Cl. 482, 489 (2015) (quoting Godfrey v. United States, 

748 F.2d at 1577). Therefore, “[b]oth the responsible person analysis and the assessment 

of willfulness are fact-based determinations unique to the circumstances of each case.” 

Jenkins v. United States, 101 Fed. Cl. at 131.

The burden of proof for these two elements, whether a plaintiff was a responsible 

person and whether a plaintiff additionally willfully failed to make and pay the requisite 

withholdings, rests with the plaintiff. As explained by a Judge of the United States Court 

of Federal Claims:

When challenging a Section 6672 assessment, “[t]he taxpayer bears the 

burden of proving both that he was not a responsible person and that his 

failure to pay over the taxes was not willful.” Stuart v. United States, 337 

F.3d 31, 36 (1st Cir. 2003). To prevail, the taxpayer must establish by a 

preponderance of the evidence that the government's imposition of the 
19

penalty against him is erroneous. Farkas v. United States, 57 Fed. Cl. 134, 

140 (2003), aff’d, 95 Fed. Appx. 355 (Fed. Cir. 2004). The taxpayer carries 

the burden of proof both for his tax refund claim and against the defendant's 

counterclaim.

Brinskele v. United States, 88 Fed. Cl. 334, 339 (2009), aff’d, 397 F. App’x 662 (Fed. Cir. 

2010); see also Waterhouse v. United States, 122 Fed. Cl. at 283; Kobus v. United States, 

103 Fed. Cl. 575, 586 (2012) (“To prevail in a § 6672 case, the taxpayer must establish 

by a preponderance of the evidence that the government's imposition of the penalty 

against him is erroneous by proving that he was either not a responsible person or not 

willful.”); Farkas v. United States, 57 Fed. Cl. at 140 (“The burden of production and 

persuasion to refute these two elements [whether plaintiff “was a responsible person” and 

whether plaintiff ”willfully failed to make the requisite withholdings”] lies upon the plaintiff 

where, as here, the government has established a prima facie case by presenting the 

assessments made against the plaintiff.”). “Once the Government establishes ‘a prima 

facie case by presenting the assessments made against the plaintiff,’ the ‘burden of 

production and persuasion . . . lies upon the plaintiff’ and must be shown by a 

preponderance of the evidence.” Waterhouse v. United States, 122 Fed. Cl. at 283 

(quoting Farkas v. United States, 57 Fed. Cl. at 140).

In addition, in a tax refund case, there is also a presumption of the correctness of 

the findings of the Commissioner of Internal Revenue. See United States v. Fior D'Italia, 

Inc., 536 U.S. 238, 243 (2002) (“An ‘assessment’ amounts to an IRS determination that 

a taxpayer owes the Federal Government a certain amount of unpaid taxes. It is well 

established in the tax law that an assessment is entitled to a legal presumption of 

correctness – a presumption that can help the Government prove its case against a 

taxpayer in court.”); Conway v. United States, 326 F.3d 1268, 1278 (Fed. Cir.) (“The ruling 

of the Commissioner of Internal Revenue enjoys a presumption of correctness and a 

taxpayer bears the burden of proving it to be wrong.” (quoting Transamerica Corp. v. 

United States, 902 F.2d 1540, 1543 (Fed. Cir. 1990)), reh’g denied (Fed. Cir. 2003); see

also Stobie Creek Inv. LLC v. United States, 608 F.3d 1366, 1381 (Fed. Cir. 2010); Bubble 

Room, Inc. v. United States, 159 F.3d 553, 561 (Fed. Cir. 1998) (“In a tax refund case, 

the ruling of the Commissioner of Internal Revenue is presumed correct.”), reh'g denied, 

en banc suggestion declined (Fed. Cir. 1999); Lima Surgical Assocs., Inc. v. United 

States, 944 F.2d 885, 888 (Fed. Cir. 1991) (“[D]eterminations of the Commissioner of 

Internal Revenue are presumptively correct.”); Widtfeldt v. United States, 122 Fed. Cl. 

158, 163 (2015), aff’d, 2016 WL 5929834 (Fed. Cir. Oct. 12, 2016); Diamond v. United 

States, 115 Fed. Cl. 516, 524 (2014) (quoting Danville Plywood Corp. v. United States, 

899 F.2d 3, 7 (Fed. Cir. 1990) (citing Welch v. Helvering, 290 U.S. 111, 115 (1933) (“In a 

tax refund suit, ‘the ruling of the [IRS] Commissioner enjoys a presumption of correctness 

and a taxpayer bears the burden of proving it to be wrong.’”) (alternation in original);

Deseret Mgmt. Corp. v. United States, 112 Fed. Cl. 438, 447 (2013) (“In a refund suit, the 

assessment made by the IRS is presumed to be correct, placing an obligation on the 

taxpayer to come forward with evidence to rebut a presumption of correctness.”); 

Ghandour v. United States, 36 Fed. Cl. 53, 59 (1996) (quoting Whiteside v. United States, 
20

26 Cl. Ct. 564, 566 (1992) (In a responsible person inquiry, “[a]s in any tax refund case, 

there is a ‘strong presumption of the correctness of the findings’ of the Commissioner.”).

The taxpayer has the burden of rebutting the presumption of correctness, but also 

“the taxpayer has the burden of establishing entitlement to the specific refund amount 

claimed.” Bubble Room, Inc. v. United States, 159 F.3d at 561; see also United States v. 

Janis, 428 U.S. 433, 440-41 (1976) (“In a refund suit the taxpayer bears the burden of 

proving the amount he is entitled to recover.” (citing Lewis v. Reynolds, 284 U.S. 281, 

modified, 284 U.S. 599 (1932)); Helvering v. Taylor, 293 U.S. at 515 (“Unquestionably the 

burden of proof is on the taxpayer to show that the Commissioner's determination is 

invalid.”); Welch v. Helvering, 290 U.S. 111, 115 (1933) (“The Commissioner of Internal 

Revenue['s] . . . ruling has the support of a presumption of correctness, and the petitioner 

has the burden of proving it to be wrong.” (citing Wickwire v. Reinecke, 275 U.S. 101 

(1927)); Charron v. United States, 200 F.3d 785, 792 (Fed. Cir. 1999) (“Since the 

[plaintiffs] were seeking refunds of taxes they had paid, they have the burden of proving 

they are entitled to the amount sought.”); Danville Plywood Corp. v. United States, 899 

F.2d 3, 7-8 (Fed. Cir. 1990); Barenholtz v. United States, 784 F.2d 375, 381 (Fed. Cir. 

1986); Widtfeldt v. United States, 122 Fed. Cl. at 163 (quoting Gingerich v. United States, 

77 Fed. Cl. 231, 240 (2007) (“A ‘plaintiff who is claiming a tax refund must prove [its] case 

by a preponderance of the evidence.’”)); Christman v. United States, 110 Fed. Cl. 1, 5 

(2013) (“In refund suits, there is no doubt that the plaintiff bears the burden of proof as to 

his or her entitlement to a tax refund.” (citing Young & Rubicam, Inc. v. United States, 187 

Ct. Cl. 635, 638, 410 F.2d 1233, 1238 (1969))); Okerlund v. United States, 53 Fed. Cl. 

341, 356 (2002) (“As a general rule, the burden of proof is on the taxpayer in tax refund 

cases.” (citing Welch v. Helvering, 290 U.S. at 115)), recons. denied, 2003 WL 1547563 

(Fed. Cl. Feb. 14, 2003), aff'd, 365 F.3d 1044 (Fed. Cir. 2004).

In sum, to rebut the presumption of the Commissioner’s correctness, “the taxpayer 

must come forward with enough evidence to support a finding contrary to the 

Commissioner’s determination.” Bubble Room, Inc. v. United States, 159 F.3d at 561. 

Stated otherwise, to overcome the presumption, the taxpayer has the burden of 

presenting “substantial evidence as to the wrongfulness of the Commissioner's 

determination.” KFOX, Inc. v. United States, 206 Ct. Cl. 143, 151-152, 510 F.2d 1365, 

1369 (1975); Arrington v. United States, 34 Fed. Cl. 144, 147 (1995), aff’d, 108 F.3d 1393 

(Fed. Cir. 1997). The burden imposed on a plaintiff is both the burden of going forward 

and the burden of persuasion. Thus, a plaintiff first must come forward with enough 

evidence to support a finding contrary to the Commissioner’s determination. See

Transamerica Corp. v. United States, 902 F.2d at 1543; Danville Plywood Corp. v. United 

States, 899 F.2d at 7-8; Arrington v. United States, 34 Fed. Cl. at 147. Even after 

satisfying the burden of going forward, a plaintiff must still carry the ultimate burden of 

proof. See Transamerica Corp. v. United States, 902 F.2d at 1543; Danville Plywood 

Corp. v. United States, 899 F.2d at 8.

Responsible Person

The court first examines, in the context of 28 U.S.C. § 6672, if Mr. Noffke is a 

responsible person. Defendant argues that “Noffke is a Responsible Person at BOOMj 
21

under Section 6672,” whereas plaintiff argues that “Mark Noffke was not a responsible 

person for purposes of imposing the trust fund recovery penalty for Boomj’s unpaid 

employment taxes for the Periods in Issue.” 

As indicated by the Federal Circuit, “[t]he cases which have been decided under

§ 6672 generally refer to the ‘person required to collect, truthfully account for, and pay 

over any tax imposed by this title’ by the shorthand phrase ‘responsible person.’” Godfrey 

v. United States, 748 F.2d at 1574 n.4 (quoting Slodov v. United States, 436 U.S. at 246 

n.7). As recently explained by a Judge of the United States Court of Federal Claims, 

“[u]nder § 6672, an individual is considered a responsible person ‘if he retains sufficient 

control of corporate finances that he can allocate corporate funds to pay the corporation's 

other debts in preference to the corporation’s . . . tax obligations.’” Waterhouse v. United 

States, 122 Fed. Cl. at 283 (quoting Brinskele v. United States, 88 Fed. Cl. at 346). As 

indicated in Jenkins v. United States, it is a “bedrock principle that the determination of

whether a person is responsible ‘is a matter of substance not form and is determined by 

the coincidence of status, duty and authority’ - with the duty to ensure that taxes are paid 

flowing from authority that enables one to do so.” Jenkins v. United States, 101 Fed. Cl. 

at 131 (quoting Cook v. United States, 52 Fed. Cl. 62, 68 (2002)). The Jenkins court 

elaborated that:

While determining responsibility perforce requires consideration of the 

totality of the circumstances, the Federal Circuit has outlined a number of 

relevant considerations:

[A] person's “duty” under § 6672 must be viewed in light of his 

power to compel or prohibit the allocation of corporate funds. 

It is a test of substance, not form. Thus, where a person has 

authority to sign the checks of the corporation or to prevent 

their issuance by denying a necessary signature or where the 

person controls the disbursement of the payroll or controls the 

voting stock of the corporation he will generally be held 

“responsible.”

Godfrey v. United States, 748 F.2d 1568, 1576 (Fed. Cir. 1984) (internal 

citations omitted); see also De Alto v. United States, 40 Fed. Cl. 868, 876 

(1998). The inquiry thus looks through the—

mechanical functions of the various corporate officers, to 

determine the persons having ‘the power to control the 

decision-making process by which the employer corporation 

allocates funds to other creditors in preference to its 

withholding tax obligations.’ The inquiry required by the 

statute is a search for a person with ultimate authority over 

expenditure of funds since such a person can fairly be said to 

be responsible for the corporation's failure to pay over its 

taxes.
22

Jenkins v. United States, 101 Fed. Cl. at 131-32 (quoting Godfrey v. United States, 748 

F.2d at 1575) (footnote omitted). As indicated above, “liability under section 6672 attaches 

only to those officers or directors with sufficient power and authority over the corporation 

that they may be considered a ‘responsible person’—i.e., one responsible for withholding 

the employees’ taxes.” Farkas v. United States, 57 Fed. Cl. at 140 (footnote omitted). 

Stated differently, in Brinskele v. United States, the court explained:

An individual is considered a responsible person “if he retains sufficient 

control of corporate finances that he can allocate corporate funds to pay the 

corporation's other debts in preference to the corporation's . . . tax 

obligations.” Jefferson [v. United States], 546 F.3d [477,] 480 [(8th Cir. 

2008)] (quoting Bowlen [v. United States], 956 F.2d [723,] 728 [(7th Cir. 

1992)] (internal quotation marks omitted)). “As a general proposition it may 

be safely postulated that one who is the founder, chief stockholder, 

president, and member of the board of directors of a corporation . . . is 

rebuttably presumed to be the person responsible under 

[Section 6672]. . . .”

Brinskele v. United States, 88 Fed. Cl. at 345-46 (quoting Feist v. United States, 221 Ct. 

Cl. 531, 607 F.2d 954, 960 (1979) (quoting McCarty v. United States, 194 Ct. Cl. 42, 437 

F.2d 961, 967–68 (1971))). As indicated in Salzillo v. United States, “the Federal Circuit 

and other courts have made clear that there can be more than one responsible person 

as ‘liability attaches to all those under the duty set forth in the statute.’” Salzillo v. United 

States, 66 Fed. Cl. 23, 33 (quoting Harrington v. United States, 504 F.2d 1306, 1311 (1st 

Cir. 1974)), appeal dismissed, 140 F. App’x 254 (Fed. Cir. 2005). Instructions from a 

superior do not relieve a subordinate of potential liability under 26 U.S.C. § 6672. See

Salzillo v. United States, 66 Fed. Cl. at 33 (quoting Brounstein v. United States, 979 F.2d 

952, 955 (3d Cir. 1992)) (“[A] phalanx of opinions holding that ‘[i]nstructions from a 

superior not to pay taxes do not, however, take a person otherwise responsible under 

section 6672(a) out of that category.’”).

As noted above, the responsible person inquiry is a fact-specific one. See

Waterhouse v. United States, 122 Fed. Cl. at 283; Gann v. United States, 121 Fed. Cl. at 

489. Turning to the facts of the above captioned case, plaintiff was the Chief Financial 

Officer and Executive Vice President of BOOMj. Mr. Noffke himself testified that he was 

“secretary-treasurer at a point in time” of BOOMj and the other various entities. Mr. Noffke 

also testified that “[i]nitially I owned a million shares of BoomJ as the private company.”20

The parties have stipulated, and Mr. Noffke confirmed during his trial testimony, that he 

had check signing authority on all of BOOMj’s bank accounts and its subsidiaries’ bank 

accounts. As noted above, the parties stipulated in advance of trial that “Plaintiff opened 

and closed bank accounts, merchant credit card holding accounts, credit cards and other 

financial accounts on behalf of BOOMj” and that “Plaintiff had the ability with respect to 

its banks to direct electronic transfers from BOOMj and its subsidiaries’ bank accounts.”

 

20 Plaintiff indicated, however, that “[w]hile that is true, Mr. Noffke lost all of those shares 

after he pledged them as collateral for a loan that Boomj incurred and defaulted.” 
23

The parties also stipulated that “Plaintiff negotiated settlements with creditors and former 

employees on behalf of BOOMj.” As indicated in the joint exhibits, in 2009 alone, more 

than 20 wire transfers between accounts worth hundreds of thousands of dollars were 

executed by Mr. Noffke. Plaintiff argues that, despite this authority, “Mr. Noffke had to 

obtain permission from Robert McNulty to write a check or order a wire transfer.” Mr. 

Noffke also had hiring and firing authority within the accounting department, and testified 

that the “[t]he accounting department reported up through me.” Testimony at trial revealed 

that Mr. Noffke supervised twenty four employees at BOOMj. 

Mr. Noffke’s responsibilities are consistent with the representations made on the 

IRS Form 4180, titled: “Report of Interview with Individual Relative to Trust Fund 

Recovery Penalty or Personal Liability for Excise Taxes,” the form signed by Mr. Noffke 

indicated yes to all of the following questions: “Determine financial policy for the 

business?” “Direct or authorize payments of bills/creditors?” “Open or close bank 

accounts for the business?” “Sign or counter-sign checks?” “Authorize payroll?” 

“Authorize or make Federal Tax Deposits?” and “Hire/Fire?” Form 4180 also asked: 

“During the time the delinquent taxes were increasing, or at any time thereafter, were any 

financial obligations of the business paid?” and the answer was “[s]tandard operational 

expenses to keep company in business,” which the form stated were authorized by Mr. 

Noffke. In light the of the foregoing, defendant argues, “because Noffke admits to having 

broad authority in the company, coupled with corroborating testimonial and documentary 

evidence, this Court should find that he is a responsible person under § 6672.” 

Plaintiff concedes that “there is no dispute that Mr. Noffke did sign checks and wire 

transfer authorizations.” Plaintiff responds that “the focus of the Government’s case is on 

Mr. Noffke’s ability to sign checks and his title as chief financial officer,” which plaintiff 

states is insufficient for him to be a responsible person, arguing “[u]nder the Godfrey case, 

the mechanical duties of signing checks and preparing tax returns are not determinative 

of liability under Section 6672—the power to control the decision-making over the 

allocation of funds is the test.” (citing Godfrey v. United States, 748 F.2d at 1575). Plaintiff 

continues:

While it is true that Mr. Noffke was a signer on all of the bank accounts, that 

does not equate to his being a responsible person for purposes of Section 

6672 of the Internal Revenue Code. Of particular significance is an analysis 

of Mr. Noffke’s roles and authority at Boomj. It is undisputed that Mr. Noffke 

was a signer on Boomj’s checking accounts. But that is where the analysis 

starts, not where it ends.

(citations omitted). The Federal Circuit in Godfrey instructed that the responsible person 

test is “a test of substance, not form.” Although plaintiff’s contends that, pursuant to 

Godfrey, “[t]he mechanical duties of signing checks and preparing tax returns are thus

not determinative of liability under § 6672,” Godfrey specifically identifies authority to sign 

checks as an indicia of being a responsible person: “Thus, where a person has authority 

to sign the checks of the corporation, or to prevent their issuance by denying a necessary 

signature, or where the person controls the disbursement of the payroll, or controls the 
24

voting stock of the corporation, he will generally be held ‘responsible.’” Godfrey v. United 

States, 748 F.2d at 1576 (citations omitted). The fact that Mr. Noffke, and not Mr. McNulty,

held check signing authority, is a strong indicator of Mr. Noffke’s responsibility. Moreover, 

there is no indication in the record, other than assertions at trial, that Mr. Noffke had to 

seek Mr. McNulty’s approval to issue checks, such as no record of sign off approvals or 

memoranda in BOOMj’s files limiting Mr. Noffke’s authority. Mr. Noffke testified in 

response to the question, “are you referring to a written document in which you gave that 

authority or you limited your authority in some way and gave it to Bob [McNulty]?” Mr. 

Noffke testified that “[t]here is no document to that effect. But what there is is -- again, we 

talked about earlier, he approves the payroll. He approves what's being paid.”

Regarding Form 4180, plaintiff argues that “[n]o representative of the IRS ever 

conducted an interview with Mr. Noffke regarding his potential personal liability for the 

trust fund recovery penalty with respect to Boomj,”21 and that “Mr. Noffke received a fully 

completed Form 4180 that Joanne Stiff had prepared for him.” Therefore, plaintiff tries to 

claim that “Mr. Noffke testified that he did not understand the purpose or import of the 

Form 4180 that he signed.” Plaintiff further argues that “Mr. Noffke testified that he did not 

comprehend the purpose of the Form 4180. He stated that he thought only the person 

whose name was shown next to the question was the person identified as responsive to 

the question.” Plaintiff, concludes that “[t]herefore, with an affirmative answer Mr. Noffke 

implicated himself, in some cases unintentionally.” Crucially, although, plaintiff signed the 

Form 4180, on which, as noted by the defendant, “[j]ust above Noffke’s signature is 

language which states that the individual declares that the information provided is ‘true, 

correct, and complete.’” Furthermore, plaintiff’s numerous years as a certified public 

accountant should have alerted him to the nature of the IRS form he was signing. 

Moreover, even when attempting to minimize his involvement with the preparation of 

Form 4180, plaintiff did not argue that the information was incorrect, only that the 

information was incomplete. After walking through the form with plaintiff’s counsel, plaintiff 

had the following exchange on cross-examination:

Q. Okay. So are you saying you signed this -- Mr. Shaff [plaintiff’s counsel]

just gave you a series of -- or went over a series of questions with you 

related to Section 3, responsibility here on the second page of Exhibit 7, 

and asked you -- I think he asked you would you have responded in this 

manner. Can you -- and you gave various responses indicating that some 

of these responses were incomplete; is that right?

A. That's correct.

Q. So -- but none of the responses were -- were wholly wrong when you 

checked yes. You just would have qualified them with an additional --

 

21 Citing to Ms. Stiff’s testimony at trial, plaintiff also notes that Ms. Stiff did not provide 

Mr. Noffke with a Privacy Act notice or a copy of IRS Notice 784, which is titled “Could 

You be Personally Liable for Certain Unpaid Federal Taxes?” Defendant does not 

challenge plaintiff’s statement that no one from the IRS conducted an interview with Mr. 

Noffke regarding Form 4180.
25

A. That's correct.

Q. Okay. And did you indeed provide any narrative to the IRS at any point 

regarding BoomJ that made those qualifications?

A. Not that I recall.

Plaintiff argues that “the chief financial officer of Boomj, Mark Noffke lacked the 

authority to direct payments to creditors, a power that Robert McNulty, the chief executor

[sic] officer, retained solely in himself.” Although it is not disputed that Mr. McNulty, unlike 

Mr. Noffke, did not have check signing authority on BOOMj’s bank accounts, plaintiff 

claims that Mr. Noffke “was the instrumentality that caused checks to be issued and the 

designated bills to be paid, but no, he was not an ultimate authority that determined whose 

bills were paid and in what amounts.” 

The plaintiff uses the term “ultimate authority” a minimum of eighteen times in his

post-trial filings. The court believes the language employed by plaintiff regarding the 

“ultimate authority” is not helpful. In Godfrey, the Federal Circuit stated that “[t]he inquiry 

required by the statute is ‘a search for a person with ultimate authority over expenditure 

of funds since such a person can fairly be said to be responsible for the corporation's 

failure to pay over its taxes.’” Godfrey v. United States, 748 F.2d at 1575 (quoting White 

v. United States, 178 Ct. Cl. 765, 372 F.2d 513, 516 (1967)) (emphasis added). As 

referenced above, however, Judge Allegra in Salzillo reminds that: 

Notwithstanding the “ultimate authority” language employed in Godfrey, the 

Federal Circuit and other courts have made clear that there can be more 

than one responsible person as “liability attaches to all those under the duty 

set forth in the statute.” Harrington v. United States, 504 F.2d 1306, 1311 

(1st Cir. 1974); see also, e.g., Lubetzky v. United States, 393 F.3d 76, 80 

(1st Cir. 2004); Gephart, 818 F.2d at 473; Godfrey, 748 F.2d at 1574–75;

Thibodeau v. United States, 828 F.2d 1499, 1503 (11th Cir. 1987); White, 

372 F.2d at 516; Scott, 354 F.2d at 296. “[T]he statute expressly applies to 

‘any’ responsible persons,” one court has explained, “not just to the person 

most responsible for the payment of the taxes,” noting further that “[t]here 

may be—indeed, there usually are—multiple responsible persons in any 

company.” Barnett, 988 F.2d at 1455 (emphasis in original); see also

Gephart, 818 F.2d at 476 (“[w]hile it may be that [other corporate officials] 

were more responsible than plaintiff, and exercised greater authority, this 

does not affect a finding of liability against the plaintiff” (emphasis in 

original)); Godfrey, 748 F.2d at 1575; Bolding, 565 F.2d at 663; White, 372 

F.2d at 516; Ghandour, 36 Fed. Cl. at 61.

Salzillo v. United States, 66 Fed. Cl. at 33 (all emphasis in original); see also Jenkins v. 

United States, 101 Fed. Cl. at 132. Moreover, in its reply brief, plaintiff acknowledges, 

“[t]o clarify, the Plaintiff does not maintain that there can be only one responsible person 
26

at an employer; only that at Boomj there was only one decision-maker with the ultimate 

authority to compel or prohibit the allocation of Boomj’s funds, Robert McNulty.” Plaintiff’s 

main argument that Mr. Noffke was not a responsible person is because of the authority 

that, according to plaintiff, Mr. McNulty wielded at BOOMj.

Principally, plaintiff relies on the decision of Salzillo v. United States, 66 Fed. Cl. 

23, in which the court found Mr. Salzillo not to be a responsible person, id. at 36, to support 

the position that Mr. Noffke was not a responsible person because of the role he described 

for Mr. McNulty and that Mr. McNulty testified to at trial. Plaintiff argues:

The Salzillo case compares very closely with this case. Mr. Noffke had 

many responsibilities, but designating who to pay was clearly not one of 

them. Mr. McNulty called all the shots on whom to pay and Mr. McNulty had 

some very strongly held beliefs on the cash management of a start up 

company. There is an almost uncanny correspondence between the facts 

of the Salzillo case and the facts of this case. We do not dispute that there 

can be more than one responsible officer of a company, only that in the 

context of Boomj, like Star Foods in the Salzillo case, there was only one 

responsible officer, the chief executive officer. 

By contrast, defendant argues that “[a]lthough Noffke has repeatedly joined forces with 

McNulty since their BOOMj debacle, Noffke attempts to hang blame solely on McNulty, 

and cites to Salzillo in support. But Salzillo supports defendant, not Noffke.” In Salzillo, 

the corporation at issue, Star Foods Processing, Inc. (Star Foods), manufactured food 

products under government contracts for the federal government. See id. at 24. As 

explained by Judge Allegra: 

The former president of Star Foods, Mr. L.C. Robbins, Jr., became involved 

with the company in 1983. At that time, Star Foods lacked sufficient capital 

to expand its business and Mr. Robbins purchased approximately two 

million dollars in equipment to lease to the company. The business, 

nonetheless, continued to flounder and, in or around March of 1986, shortly 

before Star Foods filed for bankruptcy, Mr. Robbins became directly 

involved in the business. During the summer of 1986, he assumed the title 

of president, remaining so through the end of the company's operations. As 

president, by his own admission, Mr. Robbins was the only person 

authorized to negotiate large corporate purchases, contracts, and loans; 

open and close corporate bank accounts; guarantee or co-sign corporate 

bank loans; and determine company financial policy.

Id. at 24-25 (footnote omitted). Subsequently, in 1995, 

the plaintiff, Jose Salzillo, joined Star Foods as a staff accountant, reporting 

to the then head financial officer, Mr. Felix Ramos. Mr. Ramos left around 

1995. In 1996 or 1997 (the record does not disclose which), Adam Chessler, 

who Mr. Robbins described as a “money hunter,” effectively became the 
27

company's chief financial officer, albeit for less than a year. He owned 

around 5,000 shares in the company. Mr. Chessler had signature authority 

over the corporate bank accounts, prepared detailed financial reports for 

Mr. Robbins and the board of directors, and oversaw the department that 

prepared the payroll reports and taxes. Owing to the company's limited 

funds, Mr. Chessler frequently made recommendations to Mr. Robbins as 

to which bills should be paid—toward this end, Mr. Salzillo prepared for Mr. 

Chessler periodic reports reflecting the company's cash status and a list of 

creditors. Those reports were reviewed by Mr. Chessler and eventually 

forwarded to Mr. Robbins. After Mr. Chessler left, Mr. Kirk Nessman was 

hired, as a consultant, to acquire additional funding for the company. He left 

in mid to late 1998. From the time he was hired, through 1998, plaintiff 

successively reported first to Mr. Ramos and then to Mr. Chessler. During 

the periods when the position of chief financial officer was vacant, Mr.

Salzillo reported directly to Mr. Robbins.

Id. at 25. As it related to the Salzillo plaintiff’s responsibility, 

[m]uch of the trial testimony focused, generally, on how Star Foods used its 

limited funds to pay particular creditors, and, specifically, on who controlled 

whether federal employment taxes would be paid. The record reveals that 

Mr. Salzillo frequently presented Mr. Robbins with cash balance reports and 

discussed with him the financial position of the company. Usually on 

Wednesdays, plaintiff presented Mr. Robbins with an accounts payable 

report, listing the outstanding creditors of the company and the amounts 

they were owed. After considering plaintiff's recommendations, Mr. Robbins 

would check off which creditors were to be paid, modifying the amount if 

less than the full amount owed was to be paid. Effectuating these decisions, 

Mr. Salzillo would then prepare or have prepared the appropriate checks, 

which would either be signed by Mr. Robbins, Mr. Salzillo or some other 

signatory; sometimes Mr. Salzillo or others would stamp Mr. Robbins’ name 

thereon. The record reveals that this practice was relaxed for checks in 

smaller amounts, for essential items, such as utilities, or for other items 

regularly used in production. Larger checks, particularly those targeted to 

overdue debts unrelated to production, could not be issued without Mr. 

Robbins' express approval. Plaintiff testified that around two hundred 

checks were issued by company officials each month. During the periods in 

question, Mr. Robbins also made critical decisions regarding which 

employees would be asked to go without their pay; directed that health 

insurance premiums not be paid, causing the policy to lapse; and either 

directed that child support payments not be forwarded to the appropriate 

agencies or sent checks to such agencies that were returned for insufficient 

funds. 

Id. at 26-27 (footnote omitted). Judge Allegra explained that “[o]n numerous other 

occasions, Mr. Salzillo urged Mr. Robbins to make payments to the IRS, with several such 

discussions escalating into shouting matches. While Mr. Robbins authorized some tax 
28

payments, more frequently he chose to favor other creditors at the expense of the IRS, in 

an effort to keep the business afloat,” but “[a]s a result of Mr. Robbins’ decisions, either 

no or partial tax deposits were made for the last three quarters of 1999 and the first three 

quarters of the year 2000.” Id. at 27. The Salzillo court also noted that:

Cognizant that he could be held liable, plaintiff did not resign when the 

payroll taxes remained unpaid because, according to his testimony, he 

wanted to stay and ensure that Mr. Robbins made the payments after the 

company was sold. Ms. Sanchez testified that had plaintiff made any 

payments other than those directed to production related costs, Mr. Robbins 

would have threatened to fire him, but, given the company's dire 

circumstances, probably would not have done so. There is no indication 

that, during this period, plaintiff threatened to resign if the taxes were not 

paid.

Id. at 28 (footnote omitted). 

The court agrees with plaintiff that there are some parallels between the above 

captioned case and the Salzillo case. In both instances the companies’ limited funds 

resulted in the officers making decisions about who to pay or who not to pay and when. 

Plaintiff in the case currently before the court argues in its post-trial brief, “Robert McNulty 

knew the rules, knew that he called all the shots at Boomj, that he had to approve all 

payments, that he instituted that requirement to be able to manage the limited cash 

resources in a start-up company like Boomj and that he and he alone had the vision, the 

experience and the skill to make a company like Boomj successful.” In both cases, the 

creditors, and not the IRS, were paid. In both cases, Mr. Salzillo and Mr. Noffke, the 

individuals determined to be responsible people by the IRS, repeatedly raised the issue 

of non-payment to the IRS with their superiors, but the liabilities still remained unpaid. 

Mr. Noffke testified that the employment tax liabilities “were presented again to -- to Bob 

McNulty to make that call whether to make those payments or not.” At trial in the above 

captioned case, Mr. Noffke also testified that he urged Mr. McNulty to pay the taxes, 

explaining during questioning with his attorney:

Q. How often would you urge him to pay the federal employment taxes?

A. It was front and center every time he received one of our sheets.

Q. And how often was that?

A. Traditionally weekly. We tried to make payments on Fridays.

Mr. McNulty confirmed Mr. Noffke’s statements and testified that: 

Mark [Noffke] informed me on all payables, whether it's, you know, payroll 

taxes or whatever it might be. In this specific case, the sequence of events 

was pretty straightforward. Joanne [Stiff] came to me and said, hey, we 
29

have -- you know, we have an obligation to pay, you know, taxes, and we 

have an obligation for payroll, but we're going to be short. What should we 

do? And I said, you know, go ahead and, you know, pay the payroll, hold 

the taxes, and I'll call Mark.

In response to the question of whether Mr. Noffke “expressed his views that the -- the 

federal employment taxes should be paid.” Mr. McNulty testified that “Yes, he did.” Just 

as the plaintiff in Salzillo, Mr. McNulty testified that despite the failure to pay the IRS, “[h]e 

[Mr. Noffke] didn't threaten to quit, but he made it pretty clear that he was very unhappy 

about it.” Mr. McNulty also made it clear to the court that he believed that regarding the 

payment of the employment taxes: “It's my responsibility. It's just that simple.” 

There remains crucial differences, however, between the plaintiff in the above 

captioned case and the plaintiff in Salzillo. As explained by Judge Allegra in Salzillo:

Critically, the record reveals that on at least one occasion, plaintiff 

attempted to pay the IRS, but was thwarted by Mr. Robbins. Thus, in 

December 1999, without Mr. Robbins' knowledge or approval, plaintiff wrote 

and sent to the IRS a check in the amount of $50,000. Shortly after this 

check was mailed, Mr. Robbins asked Mr. Salzillo what the cash balance 

was in Star Foods' main account and was informed that the current balance 

was approximately between $53,000 and $57,000. When Mr. Robbins 

asked Mr. Salzillo to write a check for a load of meat needed for that week's 

production, Mr. Salzillo finally informed him that he could not, because the 

money in the account had been earmarked to cover the IRS check. Mr. 

Robbins became irate and ordered Mr. Salzillo to wire the money to the 

meat supplier instead. He admonished Mr. Salzillo never to write a check to 

the IRS again. An IRS ledger confirms that a check for $50,000 was 

received around this time, but that the check was returned for insufficient 

funds. As a further means of preventing Mr. Salzillo from sending out any 

checks without his permission, Mr. Robbins seized (or had seized) from Mr. 

Salzillo the signature stamp he had previously used to sign checks on Mr. 

Robbins' behalf.

Id. at 27-28. This was an important basis for Judge Allegra to find Mr. Salzillo was not a 

responsible person, because as Judge Allegra noted, “[t]he record reveals that Mr. 

Robbins so thoroughly controlled the extraordinarily limited finances of the company as 

to make it virtually impossible for Mr. Salzillo to send funds to the IRS without his actions 

being immediately detected and actual payment averted.” Id. at 34. Judge Allegra 

reasoned:

the record reveals that, long before Mr. Salzillo became the so-called “chief 

financial officer,” Mr. Robbins was constantly apprised of the company's 

precarious cash position, and that, as day-to-day needs arose, he allocated 

the scarcely available funds to maintain and maximize production. As prime 

indication of the depth and effectiveness of his controls, the record 

reveals—and IRS records confirm—that when Mr. Salzillo attempted to pay 
30

the IRS $50,000 without obtaining Mr. Robbins’ permission, the latter 

quickly detected the unauthorized use of funds and shifted money from the 

account in question to prevent the check drafted by Mr. Salzillo from being 

cashed by the IRS.

Id. There is no such evidence in the above captioned case that Mr. Noffke ever considered 

paying the IRS directly in opposition to Mr. McNulty’s wishes, despite having the check 

writing authority. In fact, regarding his ability to make payments to the IRS that Mr. 

McNulty did not approve, Mr. Noffke testified:

Well, first of all, I didn't have the authority to do that. And could have -- you 

can say that I was embezzling money[

22] to take care of my personal liability 

with the IRS. It would not cover the full debt that we were owed, and it would 

handle a certain portion of that. And the -- the liability would still be -- there 

would still be a -- a liability out there, maybe reduced by whatever money I 

was able to hypothetically write to.

Mr. McNulty was in an interesting position at trial, not having been identified by the 

IRS as a responsible person for the BOOMj tax liabilities, despite serving as the Chief 

Executive Officer and the Chairman of BOOMj. Mr. McNulty testified that Mr. Noffke did 

have the authority to send a payment to the IRS, but that he would not have approved it: 

“I mean, the question really shouldn't be does he [Mr. Noffke] have authority. Of course 

he has authority to write a check. It's, you know, who's telling him to pay them or not 

telling them to pay.” Moreover, while Judge Allegra cites the rapid discovery of the check 

sent to the IRS and steps taken to prevent the check from being cashed by Mr. Robbins 

in Salzillo as evidence of the “prime indication of the depth and effectiveness of his 

controls,” id., despite Mr. McNulty’s statements that he was in control of the accounts, 

there is not clear evidence from the trial record that Mr. McNulty exercised the same level 

of authority or supervision as Mr. Robbins did in Salzillo. Most notably, Mr. McNulty did 

not have check signing authority at BOOMj, whereas Mr. Noffke did. Mr. McNulty 

explained this away, stating: “I mean, I didn't control it from writing the check, but I 

controlled it from discussing issues with Mark [Noffke] and directing them who should get 

paid and who shouldn't get paid.” Unlike the plaintiff in Salzillo, Mr. Noffke appears to 

have had significant responsibilities at BOOMj, including, as explained above, “Plaintiff 

negotiated settlements with creditors and former employees on behalf of BOOMj” and Mr. 

Noffke executed more than 20 wire transfers between accounts worth hundreds of 

thousands of dollars in 2009. Mr. Noffke also supervised twenty four employees at BOOM

and Mr. Noffke held hiring and firing within the accounting department, and as Mr. Noffke

testified, the “[t]he accounting department reported up through me.” Furthermore, Mr. 

McNulty’s original role at BOOMj was the nonexecutive chairman of the company. 

Moreover, Mr. McNulty indicated that he “worked on the side of the business which was 

the business strategy, business model, and, you know, the direction of the company from 

that standpoint, and then raising capital for the company,” and not day to day fiscal 

management. Therefore, the court believes that although similarities exist between the 

 

22 Plaintiff cites no authority for the proposition that payment to the IRS of taxes owed by 

BOOMj would be considered embezzlement by Mr. Noffke.
31

plaintiff in Salzillo, who was found not to be a responsible person, and Mr. Noffke, crucial 

differences are apparent, such that the court disagrees with plaintiff that “[t]here is an 

almost uncanny correspondence between the facts of the Salzillo case and the facts of 

this case.” 

Moreover, the record reflects that Mr. Noffke has continued to work for Mr. McNulty 

after BOOMj ceased operations. According to the joint stipulations of fact, “Mr. McNulty 

set up an arrangement whereby a subsidiary of BOOMj, called Kaching Kaching, Inc.

(‘KCKC’) purchased certain assets of BOOMj for 20.8% of the shares of common stock 

of KCKC” and Mr. Noffke became the Chief Financial Officer of Kaching Kaching, Inc. 

while Mr. McNulty became the Chief Executive Officer. As indicated above, Kaching 

Kaching, Inc. also failed to pay the employment tax liabilities for the tax period ending on 

December 31, 2010, and the IRS assessed plaintiff with a trust fund recovery penalty for 

that failure. Despite that failure, Mr. Noffke continued to work for Mr. McNulty, most 

recently as the Chief Executive Officer of a company called Serendipity Cafe. In fact, Mr. 

Noffke has repeatedly continued to work for Mr. McNulty, despite the fact that plaintiff 

also claimed that he felt physically threatened by McNulty when they worked together at 

BOOMj. Jeffrey Aaronson, another BOOMj employee described McNulty’s management 

approach as “[m]anagement by bullying.”

23 Joanne Stiff labelled McNulty’s management 

style as “not very good.”

24

. Although not dispositive regarding plaintiff’s status as a 

responsible person for BOOMj, the court is left to question the statements made at trial 

about the total control Mr. McNulty supposedly exercised or the feeling of being 

threatened by Mr. McNulty Mr. Noffke really felt, given that Mr. Noffke continued to accept 

new assignments from, and continued to work for, Mr. McNulty, including at the time of 

trial.

 

23 The following exchange between plaintiff’s counsel and Mr. Aaronson occurred 

regarding Mr. McNulty:

Q. How were those disagreements resolved with Mr. McNulty? 

A. Mr. McNulty would put his foot down and say, I'm in charge, and this is 

what we're going to do. 

Q. Would Mr. McNulty use loud -- a loud voice? 

A. You could hear Mr. McNulty screaming sometimes from down the hall. 

Q. Would he use profanity? 

A. Frequently.

24 Ms. Stiff further testified, “I don’t know if it would be management by bullying, but I think 

it was more of unrealistic promises made and management based off of what he promised 

people. And I can’t -- I don't think I’ve ever -- me personally, Bob’s [Mr. McNulty] never 

bullied me. So I never got that feeling of that.”
32

Plaintiff also quotes extensively from Judge Allegra’s opinion in Salzillo to provide 

additional case support for the argument that plaintiff is not a responsible person. For 

example, plaintiff quotes this entire paragraph from the Salzillo decision:

These cases, many of which are in this court, stress that while an 

individual's title or authority to sign checks may suggest a theoretical 

authority to effectuate such a payment, those features are not controlling if, 

based on the record as a whole, it preponderates that a given individual 

actually lacked the effective ability to pay taxes over to the IRS. See, e.g., 

United States v. Rem, 38 F.3d 634, 647 (2d Cir. 1994) (the power to sign 

checks and the holding of corporate office “can exist in circumstances 

where the individual in reality does not possess significant control over 

corporate finances”); Barrett, 580 F.2d at 453 (despite having authority to 

sign checks, corporate director not “responsible officer” where corporate 

president controlled which creditors would be paid, including the IRS); 

Bauer, 543 F.2d at 149 (“Mere office holding of and by itself does not render 

one responsible for the collection and paying over of employee withholding 

taxes.”); De Alto, 40 Fed. Cl. at 878 (“While the existence of another 

responsible person would not excuse plaintiff, [plaintiff's superior] retained 

such exclusive authority that plaintiff effectively had none when dealing with 

creditors”); Williams v. United States, 25 Cl. Ct. 682, 684 (1992) (officer that 

had written checks to creditors other than the IRS held not responsible 

where “though plaintiff had check writing authority and seemingly important 

titles, he lacked any independent authority within [the company].”); Heimark 

v. United States, 18 Cl. Ct. 15, 21–23 (1989) (treasurer not responsible 

person where responsibilities were ministerial and president of company 

was “autocratic” in the control of funds). As summarized by a leading 

commentator, these cases hold that “the concept of responsibility connotes 

more than corporate title” or a “theoretical authority” to pay over taxes, but 

rather “arises out of control actually exercised over the financial operations 

of the business.” Michael I. Saltzman, IRS Practice and Procedure ¶ 17.07 

(2005).

Salzillo v. United States, 66 Fed. Cl. at 35 (footnote omitted). 

The facts of the cases cited in Salzillo, however, are not closely related to Mr. 

Noffke’s situation. In Barrett, the United States Court of Claims explained that the Barrett

plaintiff “had no responsibility for making up the payroll. She had no authority over 

payment of the salaries of company employees. Creditors did not ask for her when 

inquiring about being paid. She had no responsibility for the preparation of tax returns for 

the company, nor did she sign any such returns. Plaintiff did not negotiate company 

contracts, bill customers, order supplies or hire and fire employees.” Barrett v. United 

States, 217 Ct. Cl. 617, 626, 580 F.2d 449, 453 (1978). In the above captioned case, Mr. 

Noffke ran the accounting department, supervising twenty four employees, and held hiring 

and firing authority. Furthermore, Mr. Noffke negotiated settlements with creditors and 

former employees on behalf of BOOMj. In Bauer, the Court of Claims identified the Bauer
33

plaintiff as “an outsider with respect to the financial and fiscal affairs of the company. He 

did not meet with representatives of the bank which was principally concerned with MATI's 

[Management and Technology, Inc.] financial condition.” Bauer v. United States, 211 Ct. 

Cl. 276, 543 F.2d 142, 149 (1976). Mr. Noffke, by contrast was intimately familiar with 

the financial affairs of the company, responsible for public reporting duties and helping to 

negotiate the sale of Local Ad Link, BOOMj’s most profitable subsidiary.

In De Alto, the United States Court of Federal Claims concluded that the De Alto

plaintiff was not a responsible person because 

[t]here is no evidence here of routine payments signed by plaintiff. 

Defendant produced only two checks to creditors signed by plaintiff over the 

course of his years as vice-president. Both involved the limited emergency 

situations for which plaintiff was given authority by Mr. Housman to sign 

checks. Plaintiff's lack of authority is further demonstrated by his dismissal. 

Because he did not have the authority to direct payments or to prevent 

them, plaintiff was not a responsible person under section 6672.

De Alto v. United States, 40 Fed. Cl. 868, 878, appeal dismissed, 168 F.3d 1321 (Fed. 

Cir. 1998). Mr. Noffke, however, regularly made payments, and, was at times, the only 

check signing authority at BOOMj. Although Mr. Noffke and Mr. McNulty at trial claimed 

that Mr. McNulty had effective control over which payments to make and prioritize, in De 

Alto, that control was explicit. As noted by the De Alto court, Mr. Housman, the president 

and primary stockholder, issued a March 3, 1990, memorandum which

explicitly limits the authority to approve payments to Mr. Housman. While 

the existence of another responsible person would not excuse plaintiff, Mr. 

Housman retained such exclusive authority that plaintiff effectively had 

none when dealing with creditors. The fact that Mr. Housman stated in a 

memorandum that plaintiff had ‘full authority’ related only to dealing with 

employees on behalf of Mr. Housman, not in dealing with creditors or 

deciding on how funds were to be disbursed.

Id. at 878. Mr. Noffke, by contrast, executed numerous wire transfers for the various 

company accounts totaling more than six figures. Likewise, Mr. Noffke testified in 

response to the question, “are you referring to a written document in which you gave that 

authority or you limited your authority in some way and gave it to Bob [McNulty]?” Mr. 

Noffke testified that “[t]here is no document to that effect. But what there is is -- again, we 

talked about earlier, he approves the payroll. He approves what's being paid.” 

In Williams, the United States Claims Court noted that:

Plaintiff controlled no voting stock in WBC [Williams Bridge Company]. He 

could not prevent issuance of a check by denying his signature and he had 

no authority within the corporation to sign checks to creditors unless 

authorized by his father. Plaintiff had no significant independent power over 
34

financial matters. He was the submissive son of a domineering father. He 

was obliged to do, and he did, whatever his father instructed.

Williams v. United States, 25 Cl. Ct. 682, 684 (1992). Moreover, although the Williams

plaintiff was in name the vice president, treasurer, and officer manager, “he had little 

independent authority and at all relevant times was kept on a very ‘short leash.’ His 

supervisory authority was limited to two office employees-a secretary and a bookkeeperand even that power was subject to his father's override.” Id. at 683-84. Mr. Noffke, on 

the other hand, had substantial authority over the accounting department and the SEC 

compliance at BOOMj. Furthermore, during the events at issue when the Williams Bridge 

Company failed “to segregate and pay over to the IRS social security and income taxes 

withheld from employees of the Williams Bridge Company (WBC) during the last quarter 

of 1984 and the first half of 1985,” id. at 682, the Williams plaintiff was in his twenties, 

whereas Mr. Noffke at the time of the events in question regarding at BOOMj, had been 

in the accounting industry for decades.

The court does not believe, as found in Heimark v. United States, that Mr. Noffke’s 

responsibilities were ministerial. The Heimark court explained that the Heimark

plaintiff alone authorized no expenditures, made no memorable decisions, 

issued no general orders, and exerted no particular influence over the 

course of events at GSI [Getting Services, Inc.]. Neither his uncompensated 

position as Treasurer nor his position of Comptroller, for which he received 

‘take home’ pay of $11,506.65 in 1979, conferred upon plaintiff a status to 

even significantly participate in, let alone control, the allocation of GSI funds.

Heimark v. United States, 18 Cl. Ct. 15, 21 (1989). Moreover, the plaintiff in Heimark

“enjoyed no particular respect or deference amongst the employees of GSI by virtue of 

his title as Treasurer or his position as Comptroller. To the contrary, plaintiff supervised 

no one at GSI other than, to a limited degree, a single secretary.” Id. As noted above, Mr. 

Noffke supervised the accounting department, supervising twenty four employees, and 

held hiring and firing authority. Furthermore, Mr. Noffke held substantially responsibility 

for BOOMj’s SEC compliance, regarding which plaintiff testified, “I would estimate 

basically 80 percent of my duties were in the public reporting framework.” Additionally, as 

defendant points out, citing Heimark v. United States, 18 Cl. Ct. at 19, “[a]lso telling are 

Noffke’s choices following the company’s demise. Unlike the plaintiff in Heimark, Mr. 

Noffke did not resign from Boomj.com when payroll taxes were not paid. Instead, he 

helped McNulty fold BOOMj into a new business scheme, joined McNulty in this 

endeavor—which also quickly failed—and joined McNulty for another business venture 

that remains in place until today.” In sum, none of the cases cited in Salzillo, nor Salzillo

itself, supports plaintiff’s contention that Mr. Noffke was not a responsible person at 

BOOMj. Despite plaintiff’s protestations to the contrary, after considering the trial 

testimony, trial exhibits, and all the arguments in the parties’ briefs, as well as the relevant 

case law, the court determines that Mr. Noffke is a responsible person for purposes of 26 

U.S.C. § 6672.
35

Willfulness

A individual being a responsible person, however, is insufficient to trigger liability 

under 26 U.S.C. § 6672. As indicated above, the United States Court of Appeals for the 

Federal Circuit indicated that “a person is subject to a 100 percent penalty if he satisfies 

two separate statutory requirements. First, he must be under a duty to ‘perform the act in 

respect of which the violation occurs,’ (§ 6671(b)) and that duty is ‘to collect, truthfully 

account for, and pay over’ any taxes (§ 6672). Such a person is a ‘responsible 

person.’” Godfrey v. United States, 748 F.2d at 1574 (footnote omitted). The Federal 

Circuit continued: “Second, the ‘responsible person’ must have ‘willfully’ failed to collect, 

truthfully account for, and pay over, or have ‘willfully’ evaded or defeated the tax or tax 

payment,” and “both statutory requirements must be present for the 100 percent penalty 

to be imposed.” Id. (citing McCarty v. United States, 194 Ct. Cl. 42, 437 F.2d at 967).

Having determined that Mr. Noffke is a “responsible person,” the court turns to the second 

requirement, the willfulness requirement. Although defendant argues that “Noffke willfully 

failed to pay BOOMj’s employment taxes,” plaintiff has not made arguments specific to 

the willfulness element of 26 U.S.C. § 6672. 

As noted in Farkas v. United States “as the text makes clear, section 6672 includes 

a scienter element requiring that the responsible person must have ‘willfully’ failed to 

make the requisite withholding.” Farkas v. United States, 57 Fed. Cl. at 140 (emphasis in 

original). Indeed, 26 U.S.C. § 6672(a), specifically mentions the word willfully twice: 

Any person required to collect, truthfully account for, and pay over any tax 

imposed by this title who willfully fails to collect such tax, or truthfully 

account for and pay over such tax, or willfully attempts in any manner to 

evade or defeat any such tax or the payment thereof, shall, in addition to 

other penalties provided by law, be liable to a penalty equal to the total 

amount of the tax evaded, or not collected, or not accounted for and paid 

over.

26 U.S.C. § 6672(a) (emphasis added); see also Jenkins v. United States, 101 Fed. Cl. 

at 130; Brinskele v. United States, 88 Fed. Cl. at 338. The Federal Circuit has elaborated 

that “‘the failure to pay the overdue taxes [is] willful has been seen . . . as calling for proof 

of a voluntary, intentional, and conscious decision not to collect and remit taxes thought 

to be owing—and not as requiring a special intent to defraud or deprive the Government 

of monies withheld on its account.’” Godfrey v. United States, 748 F.2d at 1576-77 

(quoting Scott v. United States, 173 Ct. Cl. 650, 354 F.2d 292, 295 (1965) (alternations 

in original)). The willfulness requirement “does not, however, require a showing of specific 

intent to defraud or otherwise of an evil motive.” Gann v. United States, 121 Fed. Cl. at 

489 (citing Godfrey v. United States, 748 F.2d at 1577); see also Godfrey v. United States, 

748 F.2d at 1577 (quoting Scott v. United States, 173 Ct. Cl. 650, 354 F.2d at 295) (“The 

focus of inquiry is rather ‘on the deliberate nature of the individual's election not to pay 

over the money and the circumstances of that refusal.’”). 
36

The Court of Federal Claims in Kobus explained that:

There are two basic ways that a person can willfully fail to pay over 

withholding taxes: a person acts willfully if the employer has funds to pay 

the taxes and the person either (1) knowingly chooses not to pay over the 

withholding taxes or (2) acts with a reckless disregard of a risk that the 

withholding taxes will not be paid.

Kobus v. United States, 103 Fed. Cl. at 588 (citing Godfrey v. United States, 748 F.2d at 

1577); see also Godfrey v. United States, 748 F.2d at 1577 (quoting Mazo v. United 

States, 591 F.2d 1151 (5th Cir.), cert. denied, 444 U.S. 842 (1979)) (“The willfulness 

requirement is satisfied ‘if the responsible person acts with a reckless disregard of a 

known or obvious risk that trust funds may not be remitted to the Government, . . . such 

as by failing to investigate or to correct mismanagement after being notified that 

withholding taxes have not been duly remitted.’”); Gann v. United States, 128 Fed. Cl. at 

401-402; Waterhouse v. United States, 122 Fed. Cl. at 285.

As noted above, “[t]he separate requirement that a responsible individual also have 

acted willfully in failing to withhold and/or remit the tax also presents a fact-intensive 

inquiry, calling for ‘proof of a voluntary, intentional, and conscious decision not to collect 

and remit taxes thought to be owing.’” Gann v. United States, 121 Fed. Cl. at 489 (quoting 

Godfrey v. United States, 748 F.2d at 1577). As previously indicated, although plaintiff 

states willfulness is a question presented in this case in his submissions to the court, 

plaintiff does not separately address the willfulness requirement. Notably, plaintiff begins 

its post-trial brief: “The only issue in this case is whether plaintiff, Mark V. Noffke, was a 

responsible person within the meaning of 26 U.S.C. §6672(a), the trust fund recovery 

penalty, of Boomj.com, Inc. during each of the four quarters of 2009.” (internal citations 

omitted). Additionally, the only reference to willfulness in the plaintiff’s reply brief is to 

argue: “Awareness goes to willfulness, not responsibility.” 

The parties have stipulated that “BOOMj failed to deposit its employment tax 

withholdings in the first, second, third and fourth quarters of 2009. Plaintiff was aware at 

the time of the delinquencies of BOOMj’s failure to meet its employment tax obligations.” 

In addition, the trial testimony demonstrated that Mr. Noffke had actual knowledge of 

outstanding liabilities. Mr. Noffke himself testified that “notices come from the IRS 

notifying you of the deficiencies,” and that BOOMj generated weekly reports identifying 

liabilities, including the tax payment requirements and deficiencies. Moreover, Mr. Noffke 

confirmed with both plaintiff’s counsel and defendant’s counsel during trial his knowledge 

of those liabilities. With defendant’s counsel, Mr. Noffke discussed the conversations 

about not paying the employment tax liabilities with Mr. McNulty: 

Q. We’ve talked a lot today about Mr. McNulty and what he would say to 

you when you would have these conversations about wanting to pay the 

employment tax liabilities, and I think you said he was always saying that 

money was just around -- around the corner; is that right?
37

A. That’s correct.

Q. And this is referring -- you heard how many times in your work with Mr. 

McNulty?

A. Many -- many times.

Q. Over the course -- I guess beginning in 2008 when you first --

A. Beginning in 2008 when we first incurred missing the payroll liability the 

first time. And actually that happened in 2008, the promise was fulfilled. We 

were able to pay those payroll taxes in 2008 in 2009.

Q. Right. But the same was not true of the employment tax liabilities 

incurred in 2009.

A. That's correct.

With plaintiff’s counsel Mr. Noffke had the following exchange:

Q. Would you say that you urged Mr. McNulty to pay the federal 

employment taxes?

A. Yes, I would.

Q. How often would you urge him to pay the federal employment taxes?

A. It was front and center every time he received one of our sheets.

Q. And how often was that?

A. Traditionally weekly. We tried to make payments on Fridays.

. . . 

Did the tenor of your discussions with Mr. McNulty change from the 

beginning of 2009 to the end of 2009 regarding employment taxes?

A. Yes, it did.

Q. Would you tell the Court.

A. It got a little bit more intense because of -- the dollar amount was getting 

extremely high. And Bob -- again, it's always the next deal. We heard him 

talk about, I would do this again. I -- you know, he -- he's still believe -- I 

mean, I'm looking at more realistic. I'm looking at what are our liabilities and 

how do you take care of the various vendors, suppliers, payroll, you know, 
38

trust fund obligations to -- basically to the point of, you know -- you know, is 

this money ever going to come in? When does it stop?

Mr. Noffke also testified about speaking with Mr. McNulty as follows:

[I]f he asked me what needed to be paid, it was going to be payroll taxes. 

But that next step, I would give him my recommendations.

Q. After he said we're not paying those right now.

A. That's correct.

Mr. McNulty also confirmed that he discussed the unpaid taxes with Mr. Noffke. As 

indicated in this following exchange with plaintiff’s counsel:

Q. And he expressed his views that the -- the federal employment taxes

should be paid.

A. Yes, he did.

Q. Yet they were not.

A. Correct. It's my responsibility. It's just that simple.

The parties have stipulated that creditors were paid with available funds while 

BOOMj had outstanding employment tax liabilities with the IRS, and Mr. Noffke also 

testified at trial that other vendors were paid even though there were the outstanding tax 

liabilities, which, as demonstrated by Mr. Noffke’s own testimony, Mr. Noffke was aware 

of the unpaid tax liabilities. Referring to the cost of BOOMj’s servers, Mr. Noffke had the 

following exchange with his attorney:

Would that be a bill that Mr. McNulty would give priority to?

A. Yes, that would be. Anything to keep the business up and running was 

his priority.

Q. When you would have these discussions with Mr. McNulty, would you 

make recommendations as to what should be paid?

A. If I felt – we’re in this court right now of what type of listening powers I 

had with him. My whole priority, and -- and I -- I do it every day. I -- on the 

taxes, it was so important, and that's why we put it front and center for him 

that that is a responsibility of the company. I was -- working with this 

company and this operation and being in that position is -- is -- is a very 

difficult position for myself because of recognizing the exposure and the 
39

potential of what we’re -- you know, what the company had, the liability there 

that was outstanding.

Although Mr. Noffke continually painted Mr. McNulty as the sole decision maker, as the 

signatory on the accounts, it was Mr. Noffke who made the payments to the vendors. As 

noted above, in 2009, Mr. Noffke made numerous wire transfers, and at trial he testified 

that “[o]n certain large amounts to some of our vendors, I would do the wire transfer.” As 

Mr. Noffke had knowledge of, and understood, the tax liability, as well as the possibility 

of personal liability, and he, nonetheless, himself paid out to creditors despite the 

outstanding payments due the IRS, Mr. Noffke perfectly fits the definition for acting 

willfully. See Kobus v. United States, 103 Fed. Cl. at 588 (“[A] person acts willfully as a 

matter of law if, after he has actual knowledge of a tax deficiency, he uses unencumbered 

funds to pay other creditors instead of the United States.”). 

In addition, as the parties have stipulated, “Plaintiff signed a Form 4180 interview 

form regarding his role at BOOMj and his knowledge of the unpaid liabilities on May 18, 

2010. Although discussed above, most notable about the Form 4180, is the question:

“During the time the delinquent taxes were increasing, or at any time thereafter, were any 

financial obligations of the business paid,” to which the answer was yes, with the 

explanation “Standard operational expenses to keep company in business.” In response 

to the question: “Who authorized them to be paid?” the Form 4180 stated: “Mark Noffke.”

Defendant argues that, “[a]s Noffke was intimately aware of the unpaid tax liabilities to 

the IRS, and had the ability to sign a check or wire funds to the IRS to satisfy that debt 

but did not do so, he has acted willfully under § 6672, and this Court should rule 

accordingly.”25 Considering all the evidence introduced at trial, including the exhibits and 

 

25 In addition, as a long time Chief Financial Officer and certified public accountant, Mr. 

Noffke was aware of both of the requirements of 26 U.S.C. § 6672 and the ability of the 

government to recover the nonpayment of employment taxes. In fact, Mr. Noffke 

previously had been responsible for paying payroll taxes as Chief Financial Officer of

National Storm Management. Mr. Noffke also testified at trial on cross-examination:

Q. [H]ow long have you known about 6672 or the trust fund recovery 

penalties? When did you learn about that ability of the government?

A. Most likely in college.

Q. And you said -- testified earlier that when Mr. Shaff showed you the Form 

4180, that you -- you knew what that was for; is that right?

A. That’s correct.

Q. So you understood that the Form 4180 is a tool that the Internal Revenue 

Service uses to assess someone's or to make a determination regarding 

someone's status as a responsible officer of a company and their willfulness 

regarding the nonpayment of employment taxes; is that right?
40

the testimony, the court agrees with defendant and concludes that Mr. Noffke willfully 

failed to pay the obligated employment taxes. Based on the record before the court, the 

court finds that plaintiff knowingly chose not to pay over the withholding taxes. See Kobus 

v. United States, 103 Fed. Cl. at 588 (“[A] person acts willfully if he has actual knowledge 

of a past or present withholding-tax deficiency and he voluntarily chooses not to pay the 

United States. More specifically, a person acts willfully as a matter of law if, after he has 

actual knowledge of a tax deficiency, he uses unencumbered funds to pay other creditors 

instead of the United States.” (footnote and citation omitted)). As plaintiff is both a 

responsible person and willfully failed to pay the required taxes, plaintiff is liable under 26 

U.S.C. § 6672.

CONCLUSION

As noted in Jenkins v. United States: “An individual against whom the IRS has 

made a section 6672(a) assessment ordinarily has the burden of proving, by a 

preponderance of the evidence, that at least one of the composite elements of liability 

under that section is absent. And that burden squarely falls on plaintiff here.” Jenkins v. 

United States, 101 Fed. Cl. at 131 (citations omitted). Mr. Noffke has failed to meet the 

burden to prove he was not a responsible person. Further, plaintiff has not demonstrated

that the failure to pay the required taxes was not willful. Therefore, Mr. Noffke is both a 

responsible person and willfully failed to pay BOOMj’s employment taxes for 2009. The 

court understands that Mr. Noffke is in a difficult position, as he was identified as the 

responsible person by the IRS, instead of Mr. McNulty, who, in the court’s view, may have 

had an equal, if not greater, responsibility to make the payments to the IRS, but who set 

himself up in the company without check signing authority on BOOMj’s accounts, leaving 

that authority to others, including Mr. Noffke. This, however, does not relieve Mr. Noffke 

of his responsibilities, which plaintiff plainly understood, and the IRS sought to recover 

payment from Mr. Noffke, and not Mr. McNulty, for unexplained reasons. Therefore, 

plaintiff’s complaint is DISMISSED. Defendant’s counterclaim is GRANTED. A schedule 

 

A. That’s correct.

Q. And that’s something you've understood for a long time. You've known 

about 6672 for a long time; is that right?

A. Don't know if I referred to it by the code number, but that officers of 

companies could become liable for payroll taxes.

Q. And you -- when you took on this -- this role as CFO of -- of BoomJ, did 

you understand that that was a potential -- that -- that a role such as that 

could carry a potential personal liability should there be nonemployment --

nonpayment of employment taxes?

A. Yes, I did.
41

for further proceedings to resolve the amount owed to defendant will be set by separate 

Order.

IT IS SO ORDERED.

s/Marian Blank Horn 

MARIAN BLANK HORN

 Judge