Opinion ID: 3004257
Heading Depth: 3
Heading Rank: 2

Heading: IRS’s September 8, 2003 and September 18, 2003

Text: Collection Efforts Kovacs contends that the IRS’s communications after July 8, 2002 compounded its error and were either discrete additional violations of the discharge injunction or continuing unlawful acts that occurred within the two-year limitation period. We agree that the actions taken by the IRS subsequent to July 8, 2002, after the IRS informed Kovacs in writing on August 14, 2003 of its mistake in attempting to collect discharged taxes, were discrete and independently actionable violations of the discharge injunction. As an initial matter, while not fatal to her claim based on the IRS’s post-July 8, 2002 collection efforts, Kovacs’ invocation of the continuing violation theory is not proper in this context. The continuing violation doctrine acts as a defense to the statute of limitations, Limestone Dev. Corp. v. Village of Lemont, Ill., 520 F.3d 797, 801 (7th Cir. 2008), by delaying its accrual or start date, Hukic v. Aurora Loan Serv., 588 F.3d 420, 435 (7th Cir. 2009). The doctrine applies when “a tort involves a continued repeated 4 (...continued) should compel the finding that her cause of action did not accrue until the IRS notified her of its mistake. Kovacs, however, has waived this argument because she did not raise this issue before the district court, Skarbek v. Barnhart, 390 F.3d 500, 505 (7th Cir. 2004), and she raised it for the first time in her reply brief, London v. RBS Citizens, N.A., 600 F.3d 742, 747 (7th Cir. 2010). No. 09-3328 17 injury” and “the limitation period does not begin until the date of the last injury or when the tortious act ceased.” Rodrigue v. Olin Employees Credit Union, 406 F.3d 434, 442 (7th Cir. 2005). “The continuing violation doctrine allows a complainant to obtain relief for a time-barred act . . . by linking it with acts that fall within the statutory limitations period.” Filipovic v. K & R Express Syst., Inc., 176 F.3d 390, 396 (7th Cir. 1999). “It is thus a doctrine not about a continuing, but about a cumulative, violation.” Limestone, 520 F.3d at 801. The continuing violation doctrine, however, does not apply to “a series of discrete acts, each of which is independently actionable, even if those acts form an overall pattern of wrongdoing.” Rodrigue, 406 F.3d at 443; see also Filipovic, 176 F.3d at 396 (actions “so discrete in time or circumstances that they do not reinforce each other cannot reasonably be linked together in a single chain, a single course of conduct, to defeat the statute of limitations”). Each of the IRS’s attempts to collect taxes from Kovacs was a discrete act rather than a continuing violation or part of the original violation. The plain language of the Bankruptcy Code provides that a discharge “operates as an injunction against the commencement or continuation of . . . an act, to collect, recover or offset any such debt as a personal liability of the debtor.” 11 U.S.C. § 524. This is not a case in which “a series of wrongful acts blossom[ed] into an injury on which suit [could] be brought” as of the date of the later acts. See Limestone, 520 F.3d at 801. Instead, after the IRS informed Kovacs of its error in attempting to collect her discharged taxes it made two additional, discrete attempts to collect Kovacs’ 18 No. 09-3328 discharged tax liabilities. Because the record supports that each of these acts constituted a separate violation of the discharge injunction, Kovacs need not rely on the continuing violation doctrine to recover damages for the IRS’s violation of the discharge injunction. Indeed, contrary to the bankruptcy court’s holding that Kovacs failed to demonstrate that the IRS correspondence in September 2003 violated the discharge order, the face of the two September 2003 letters to Kovacs require a contrary conclusion. First, the September 8, 2003 letter, applicable to the tax period ending December 31, 1990, noted a balance due of $13,122.43 and requested Kovacs to pay the full amount by September 18, 2003. Second, the September 18, 2003 letter rejected Kovacs’ offer to pay a portion of her tax liabilities for the tax periods ending December 1990-December 1995, and December 1999. The letter further stated that Kovacs’ tax liabilities for those years were legally due and collectible and requested Kovacs to pay her account in full. The mere fact that an IRS officer had previously informed Kovacs of its mistake does not cure its later attempts to collect discharged taxes from Kovacs. Based on their plain language, it is clear that the two September 2003 letters were a new effort on the part of the IRS to collect on Kovacs’ discharged debts and were therefore discrete violations of the discharge order. See, e.g., Thibodaux v. United States (In re Thibodaux), 201 B.R. 827, 832-33 (Bankr. N.D. Ala. 1996) (holding that the IRS violated a 11 U.S.C. §524(a)(2) discharge injunction on six separate occasions by seeking improper collection on each of those six dates). While Kovacs cannot employ the September 8 No. 09-3328 19 and September 18, 2003 letters to save her otherwise time-barred claims, with respect to these acts, Kovacs’ January 19, 2005 administrate claim was filed well within the two-year statutory limitations period of 26 U.S.C. § 7433(d)(3). The bankruptcy court thus erred in holding that Kovacs’ claim was time-barred in this regard.