~4-
IRS a Notice of Deficiency regarding his 1995 tax liability.?
Godbout contends the deficiency was wrong - he paid all taxes due
in 1995. Upon receipt of the notice, he sent the IRS copies of a
bank statement and a cancelled check as proof that he paid the
taxes. Godbout alleges that Parizek, or someone under his
direction, rejected the statement and check as insufficient
evidence of payment. Godbout also received information from the
IRS pursuant to a Freedom of Information Act request, see 5
U.S.C. § 552, but the documents did not include a copy of the
cancelled check used to pay the 1995 taxes. According to
Godbout, then, the cancelled check and other unidentified
“material evidence” had been destroyed by Parizek or someone
under his authority. Godbout also requested, but was denied, an
in-person meeting with IRS officials.

On these facts, the amended complaint alleges six counts:
due process claims under the United States and [Illinois
Constitutions (Counts I and II, respectively), fraud and
conspiracy to commit fraud (Counts III and IV), and theft and
conspiracy to commit theft (Counts V and VI).° Godbout seeks

compensatory damages in the amount of $5,800 (we infer that this

2The amended complaint does not specify the amount of the
deficiency.

Spy “theft,” we understand Godbout to refer to the tort of
conversion.


-9-
normal business hours. Finally, even intentional conduct - here,
the destruction of evidence - may be deemed to be within the
scope of employment if it was motivated by a desire to serve the

employer. See Hodges v. Gibson Prods. Co., 811 P.2d 151, 156-57

(Utah 1991) (employer liable for employee’s intentional malicious
prosecution because employee was motivated in whole or in part to
carry out employer’s purpose); Phillips v . , 666
P.2d 876, 881-83 (Utah 1983) (employer liable for employee’s act
of fraud); Bowman v. Hayward, 262 P.2d 957, 960 (Utah 1953)
{holding sheriff liable for assault and battery committed by
deputy while acting in official capacity); see also Wright v.
it Danvi , 174 T1ll.2d 391, 221 I11.Dec. 203, 675 N.E.2d
110, 118 (1996) (acknowledging that “even the criminal acts of an
employee may fall within the scope of employment”); Coleman vy.
Smith, 814 F.2d 1142, 1150-51 (7th Cir. 1987) (police officers
who “usurped” and “misused” their power by conducting a false
arrest and “destroying records” nevertheless acted within the
scope of their employment). Here, we find nothing in Godbout’s
pleadings to suggest that Parizek’s conduct was motivated by
personal gain, or anything other than a desire, however
misguided, to carry out the tax-collection objectives of the IRS.

In sum, Godbout has not met his burden of coming forward with

specific facts that, if true, would demonstrate that Parizek


-6-

with Godbout has been the receipt of a letter, dated January 13,
2003 and addressed to Parizek’s home, in which Godbout objected
to the IRS’s determination of his 1995 tax liability. After
receiving the letter, Parizek reviewed Godbout’s case file. The
file indicated that Godbout had submitted a joint tax return for
the 1995 tax year, but had refused to sign the return for
“constitutional reasons.” According to Parizek, when a taxpayer
submits an unsigned return, he is treated as a non-filer. Anda
non-filer may not benefit from joint filer rates and itemized
deductions, but rather defaults to single filer rates and the
standard deduction. Not surprisingly, this often results in a
higher tax liability. When such increases result, as was the
case with Godbout, a notice of deficiency in the amount of the
additional tax is sent to the taxpayer. These notices
customarily refer to a manager in the IRS office from which the
notice was sent.

In reviewing Godbout’s file, Parizek also learned that an
IRS employee under his supervision had explained to Godbout the
reasons for the IRS‘s action during a November 22, 2002 telephone
conversation. The file also revealed that Godbout had requested
a face-to-face meeting with IRS officials, The request was
denied because “IRS appeals do not extend to failure to comply

with the tax laws because of . . . constitutional, . . . or


5.
is the amount of the tax deficiency) and punitive damages of
$500,000.

The United States has renewed its motion to substitute
and filed an accompanying motion to dismiss. We address these
motions in turn.

DISCUSSION
A. Motion to Substitute

Although the motion to substitute is filed by the United

States, it is the plaintiff opposing substitution who bears the

burden of persuasion. See Hamrick v. Franklin, 931 F.2d 1209,

1211 (7th Cir. 1991) (“[T)he plaintiffs have the burden of
showing that the defendants’ conduct was not within the scope of
employment.”); House v. Laro, No. 01 C 1104, 2001 WL 686911, at
*1 (N.D. Ill. June 18, 2001) (“The certification is prima facie
proof that the challenged conduct was within the scope of
employment, which plaintiff must rebut by specific facts.”).

The United States’s motion to substitute is accompanied
by an affidavit signed by Parizek. According to the affidavit,
Parizek is an operations manager at an IRS Service Center in
Ogden, Utah where he supervises approximately 260 employees.
Parizek states that he rarely, if ever, has direct contact with
individual taxpayers and he ordinarily has no involvement in the

process of determining their tax liabilities. His only contact


Under Utah law, “scope of employment”
includes: those acts which are so closely
connected with what the servant is employed
to do, and so fairly and reasonably
incidental to it, that they may be regarded
as methods, even though | quite improper ones,
of carrying out the objet tives of the
employment. . . . Uta ourts have focused
on three factors in defi ling when an
employee’s conduct falls |within the scope

of employment. First, the conduct must be
generally related to that:which the employee
is employed to perform.! ‘the conduct must
occur substantially within the hours and
ordinary spatial boundaries of the
employment. Finally, the employee’s conduct
must be motivated, at least in part, by the
purpose of serving the employer’s interest.

Richman v. Straley, 48 F.3d 1139, 1145 (10th Cir. 1995)
(citations and internal quotations omitted.). Godbout contends
that Parizek, or someone under his control, engaged in the
following activity: sent Godbout an erroneous deficiency notice
regarding his 1995 tax liability; rejected Godbout’s evidentiary
proffer allegedly demonstrating payment; refused to have an in-
person meeting with Godbout; and destroyed “material evidence,”
including a cancelled check, showing payment of the 1995 taxes.
To begin with, all of Parizek’s alleged conduct, even if “quite
improper,” was undertaken in his official capacity as an employee
of the IRS and in connection with the assessment and collection
of taxes. There are no allegations that Parizek engaged in any

unlawful activity away from the Ogden Service Center or outside


‘ Mite Order Form (06/97)

. Won United States District Court, Northern District of [inois
veri Magistrate Judge John F. Grady “toa Assigned Sudge
CASE NUMBER 03 C 2879 DATE December 21, 2004
CASE Godbout v. Parizek
TITLE
[In the following box (a) indicate the party filing the motion, e.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the
nature of the motion being presented.)
MOTION:
DOCKET ENTRY:

qd) a Filed motion of [ use listing in “Motion” box above.]

(2) o Brief in support of motion due ___.

@) o Answer brief to motion due__. Reply to answer briefdue__-

(4) Oo Ruling/Hearingon_ eset for saat

(5) a Status hearing[held/continued to] [set for/re-set for]on__—setfor__—__— at

(©) a Pretrial conference(held/continued to} [set for/re-set for}on__—sssetfor at
(7) a Trial[set for/re-set for]on saat

8) oO [Bench/Jury trial) [Hearing} held/continued to___—at

(9) ia) This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to}

OFRCP4(m) General Rule21 O FRCP4i(aX(1) O FRCP41(a)(2).

(10) —_@ [Other docket entry] For the reasons stated on the attached memorandum opinion, the United States’s
motion to substitute [26-1] and motion to dismiss [27-1] are granted. This action is dismissed with prejudice |
for lack of subject matter jurisdiction (Counts II — VJ) and for failure to state a claim (Count I).

ay im} [For further detail see order on the reverse side of the original minute order.]

No notices required, advised in open court.

No notices required.

ov | Notices mailed by judge's staff.
Notified counsel by telephone.
Docketing to mail notices,
Mail AO 450 form.

3 ssid “sa

Copy to judge/magistrate judge.

Sith Md 82 o2a nah
courtroom
deputy's SE
initials -

Date/time received in
central Clerk’s Office mailing depusy initials



-11-

agency must then deny the claim before a plaintiff may proceed
with a tort suit against the United States or its employees. See
id. Godbout has not done this. Exhaustion of administrative
remedies cannot be waived, see Deloria v. Veterans Admin., 927
F.2d 1009, 1011 (7th Cir. 1991), and is a necessary prerequisite
to our jurisdiction under the FTGR. See McNeil v. United States,
508 U.S. 106, 113 S.Ct. 1980, 124 L.Ed.2d 21 (1993). Accordingly,
Godbout’s state law tort claims, Counts JI through VI, are
dismissed for lack of subject matter jurisdiction.

This leaves us with Godbout’s “due process claim,” which

falls beyond the coverage of the Westfall Act and the FYCA. A
constitutional claim seeking monetary relief from an individual
federal official would necessarily proceed on the _ theory
recognized in Bivens v. Six Unknown Named Agents, 403 U.S. 388,
397, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971). However, the Seventh
Circuit has specifically disallowed any Biyens-type remedy for

alleged constitutional violations associated with tax assessment

and collection activities. See Cameron v. Internal Revenue
Service, 773 F.2d 126 (7th Cir. 1985). This is because Congress

has established an exclusive and comprehensive administrative
scheme to resolve tax-related disputes, and these statutory

remedies preclude the recognition of a Bivens claim. See


-10-
acted outside the scope of his employment. Accordingly, the
United States’s motion to substitute is granted.
B. Motion to Dismiss

The United States’s unrebutted scope certification
transforms Godbout’s common law tort claims against Parizek into
claims against the United States under the FTCA. See 28 U.S.C. §
2679. As we noted in our earlier opinion in this case, see
Godbout, 2004 WL 442601, at *3, substitution is often tantamount
to a judgment against the plaintiff. That is the case here. The
FTCA waives sovereign immunity for many tort claims, but there
are exceptions. And one such exception is “[a]ny claim arising
in respect of the assessment or collection of any tax. ..." 28
U.S.C. § 2680(c). This section is “interpreted broadly” and
covers “any activities of an IRS agent even remotely related to

his or her official duties.” Bartoli v. Attorney Registration
and Disciplinary Commission of Illinois, No. 97 C 3412, 1998 WL

596694, at *3 (N.D. Ill. Sept. 2, 1998) (¢iting Capozzoli v.
Tracey, 663 F.2d 654, 658 (5th Cir. 1981)). Godbout’s claims fit
comfortably within this exception.

Moreover, to recover damages under the FICA, a plaintiff
must first file an administrative claim with the appropriate

federal agency - here, the IRS. See 28 U.S.C. § 2675(a). The


-7-

similar grounds.” (Parizek Aff., p. 4, citing IRS Revenue
Procedure 68-12.) Parizek is not aware of any concealment,

alteration or destruction of any document relating to Godbout by
any IRS employee. Finally, Parizek states that had never heard
of Godbout prior to receipt of the January 2003 letter, and he
has had no contact with him since.

From Parizek’s affidavit, it appears that his only
involvement with Godbout consisted of reviewing his case file.
According to Parizek, he did this after the IRS had already
issued its deficiency notice, and there is no indication that
Parizek took any additional action in relation to Godbout or
ordered anyone else to do _ so.‘ Godbout offers nothing
substantive in response and instead seeks discovery to prove the
allegations in the complaint. Discovery, however, is
unnecessary. Even if we set aside Parizek’s affidavit, and
assume that Godbout’s allegations are true, they do not
demonstrate that Parizek’s conduct was outside the scope of his
employment. In making that determination, we apply the law of
the state in which the alleged unlawful conduct occurred. That

is the law of Utah:

‘Incidentally, we also understand Parizek’s affidavit to say,
contrary to the allegations in the amended complaint, that the IRS
never claimed that Godbout failed to file a tax return, with a check,
in 1995. The IRS simply stated that Godbout owed more than was
tendered in 1995 because he did not sign his return.


3-
515 U.S. 417, 436-37, 115 S.Ct. 2227, 132 L.Ed.2d 375 (1995))
As we explained in our opinion denying remand:

Godbout may contest the United States
Attorney’s scope of employment determination
to the extent it triggers the substitution
of the United States as the sole

defendant. If Godbout’s challenge is
successful, then Parizek will be re-
substituted as the defendant, and the suit
will proceed against him in his individual
capacity in this court, subject to a review
of subject matter jurisdiction. Should
Godbout fail to show that the government’s
scope of employment determination is in
error, then the action will be against

the United States. But... depending

on the immunities or other defenses
available to the United States, substitution
could effectively constitute a judgment
against Godbout. That is not to say that
Godbout would have no avenue of recourse, but
only that his claim may not fall within

the narrow confines of the United States’s
waiver of immunity under the FTCA.

Godbout, 2004 WL 442601, at *3 (citations omitted.)
Because certification is not conclusive on the question of
substitution, we treated the United States’s notice of
substitution as a motion to substitute. See Godbout, 2004 WL
442601, at *3.

But before addressing the substitution issue, we granted
Godbout’s request to file an amended complaint, which alleges the

following. In or around October 2002, Godbout received from the


-2-
U.S.C. § 2679(d)(2).1 Under the Act, when a federal employee is
sued for a state law tort and the United States Attorney General

“”

files a “scope certification, the case is removed to federal
court, the United States is substituted as the defendant, and the
case proceeds against the United States under the FTCA. See id.
Godbout filed a motion to remand, arguing that the scope
certification was in error, i.e., Parizek was not acting within
the scope of his employment, and therefore removal was likewise
erroneous. We denied Godbout’s motion because “the plain
language of the Act’ forecloses judicial review: ‘[the]
certification of the Attorney General shall conclusively
establish scope of office or employment for purposes of
removal.’” Godbout, 2004 WL 442601, at *2 (citing 28 U.S.C. §
2679 (d) (2) (emphasis added)). Godbout also challenged the
substitution of the United States in place of Parizek. While
the Attorney General’s certification is conclusive for purposes

of removal, it is not for purposes of substitution. See Godbout,

2004 WL 442601, at *2-3 (citing Gutierrez de Martinez v. Lamagno,

"The Westfall Act, properly known as the Federal Employees
Liability Reform and Tort Compensation Act of 1998, amended several
provisions of the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b), 2671-
80 (“the FTCA”), by extending immunity to federal employees for state
law torts committed within the scope of their employment. The Act was
Congress’s response to the Supreme Court's decision in Westfall v.
Erwin, 484 U.S. 292, 108 S.Ct. 580, 98 L.Ed.2d 619 (1988). See
Godbout v. Parizek, No. 03 C 2879, 2004 WL 442601, at *1 n.1 (N.D.
Ill. Feb. 9, 2004) (discussing the origins of the Act).



03-2879.042-TCM December 21, 2004

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

DAVID GODBOUT,
Plaintiff,
No. 03 C 2879

Vv.

DENNIS PARIZEK and
UNITED STATES OF AMERICA,

DOCKETED
DEC 29 2004

Defendants.

MEMORANDUM OPINION

Before the court is defendants’ motion to substitute
and motion to dismiss. For the reasons set forth below, both
motions are granted.

BACKGROUND

This action arises from pro se plaintiff David Godbout’s
dispute with the Internal Revenue Service regarding his tax
liability. Godbout originally brought suit action against Dennis
Parizek, an IRS employee, in DuPage County, Illinois small claims
court. The United States then filed, pursuant to the Westfall
Act (“the Act”), a notice of removal, a notice of substitution of
the United States as the defendant, and a certification that
Parizek was “acting within the scope of his office or employment

at the time of the incident out of which the claim arose.” 28


sea tee

-12-
Schweiker _v. Chilicky, 487 U.S. 412, 423, 108 S.Ct. 2460, 101

L.Ed.2d 370 (1988); Bush v. Lucas, 462 U.S. 367, 368, 103 S.Ct.
2404, 76 L.Ed.2d 648 (1983). As the Seventh Circuit reasoned in
Cameron:

Congress has given taxpayers all sorts

of rights against an overzealous

officialdom, including, most fundamentally,

the right to sue the government fora

refund if forced to overpay taxes, and it

would make the collection of taxes chaotic

if a taxpayer could bypass the remedies

provided by Congress simply by bringing a

damage action against Treasury employees.
773 F.3d at 129. Accordingly, because the statutory remedies
available to Godbout foreclose relief under a Bivens theory,
Count I is dismissed for failure to state a claim upon which
relief can be granted.

CONCLUSTON
For the foregoing reasons, the United States’s motions to

substitute and to dismiss are granted. This action is dismissed

with prejudice for lack of subject matter jurisdiction (Counts II

through VI) and for failure to state a claim (Count I).

DATE: December 21, 2004

wom  \ytsstye ty

John F. Grafly, United States Distri judge