Court Opinion

ID: 931967
Source: CourtListenerOpinion
Date Created: 2013-06-26 15:47:51.833858+00
Date Added: 2024-06-11T15:14:05.780913
License: Public Domain

12-2208
    United States v. Evseroff

                           UNITED STATES COURT OF APPEALS
                               FOR THE SECOND CIRCUIT

                                      SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF
APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER
IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY
ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

         At a stated term of the United States Court of Appeals for
    the Second Circuit, held at the Thurgood Marshall United States
    Courthouse, 40 Foley Square, in the City of New York, on the 26th
    day of June, two thousand thirteen.

    PRESENT:
              RALPH K. WINTER,
              PETER W. HALL,
                   Circuit Judges,
              WILLIAM K. SESSIONS III,*
                   District Judge.
    _____________________________________

    United States of America,

                                Plaintiff-Appellee,

                      v.                                   12-2208

    Jacob Evseroff,

                                Defendant-Appellant,

    New York State Department of Taxation,
    Paul Lawrence Evseroff, Kenneth James Evseroff,
    Lynn R. Terrelonge, Barry A. Schneider,

                   Defendants.
    _____________________________________

             *
           The Hon. William K. Sessions III, of the United States
    District Court for the District of Vermont, sitting by
    designation.
FOR PLAINTIFF-APPELLEE:        Kenneth W. Rosenberg, Attorney
                               (Michael J. Haungs, Attorney,
                               Loretta E. Lynch, United States
                               Attorney for the Eastern District
                               of New York, on the brief), for
                               Kathryn Keneally, Assistant
                               Attorney General, Tax Division,
                               United States Department of
                               Justice, Washington, D.C.

FOR DEFENDANT-APPELLANT:       Jacob Evseroff, pro se, Brooklyn,
                               N.Y.

     Appeal from the judgment of the United States District Court

for the Eastern District of New York (Matsumoto, J.).

     UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the judgment of the district court is AFFIRMED.

     Defendant-Appellant Jacob Evseroff, a licenced attorney

proceeding pro se, appeals from the district court’s judgment

authorizing the Government, in order to satisfy Evseroff’s tax

liabilities, to collect against all assets held by a trust

created by Evseroff (the “Trust”).    We assume the parties’

familiarity with the underlying facts, the procedural history of

the case, and the issues on appeal.

I.   Standing on Appeal

     As an initial matter, the Government challenges Evseroff’s

standing to appeal this matter pro se in the absence of any Trust

representative.   “Standing to appeal is an essential component of

our appellate jurisdiction,” and it therefore must be resolved

before reaching the merits of Evseroff’s appeal.    Official Comm.

                                 2
of Unsecured Creditors of WorldCom, Inc. v. SEC, 467 F.3d 73, 77

(2d Cir. 2005).    In general, Article III standing consists of

three requirements: (1) injury in fact; (2) causation; and (3)

redressibility.     See Lujan v. Defenders of Wildlife, 504 U.S.
555, 560-61 (1992).    To demonstrate injury in fact, “a litigant

must have suffered ‘an invasion of a legally protected interest’

that is ‘concrete and particularized’ and ‘actual or imminent.’”

Tachiona v. United States, 386 F.3d 205, 210-11 (2d Cir. 2004)

(quoting Arizonans for Official English v. Arizona, 520 U.S. 43,

64 (1997)).    “To have standing at the appellate stage . . . a

litigant must demonstrate injury caused by the judgment rather

than injury caused by the underlying facts.”     Id. at 211

(internal citations omitted).    In addition to Article III

standing, the doctrine of prudential standing “encompasses the

general prohibition on a litigant’s raising another person’s

legal rights . . . and the requirement that a plaintiff’s

complaint fall within the zone of interests protected by the law

invoked.”     Elk Grove Unified Sch. Dist. v. Newdow, 542 U.S. 1, 11

(2004) (internal citation and quotation marks omitted).

     In his reply brief, Evseroff asserts that the injury caused

by the district court’s judgment is the likelihood that the

Government will seize and dispose of the Dover Street residence,

one of the trust’s assets, thus depriving him of his place of

residence.    This assertion is sufficient to establish Evseroff’s

                                   3
Article III standing on appeal.       See Baur v. Veneman, 352 F.3d
625, 633 (2d Cir. 2003) (“[T]hreatened harm in the form of an

increased risk of future injury may serve as injury-in-fact for

Article III standing purposes.”).      Moreover, because his fear of

being dispossessed of his place of residence as a result of the

district court’s judgment implicates Evseroff’s own legal rights,

the prohibition against raising third-party rights embodied in

the prudential standing doctrine is not implicated.       See Newdow,
542 U.S. at 11.1

II.   Merits

      Under federal law, the Government may impose a lien on any

“property” or “rights to property” belonging to a taxpayer until

the taxpayer’s liability is satisfied or the statute of

limitations bars collection.   See Drye v. United States, 528 U.S.
49, 55-56 (1999); see also 26 U.S.C. §§ 6321, 6322.      Under the

fraudulent conveyance laws of the state in which the property is

located, the Government may seek to enforce such a lien against a

taxpayer who fraudulently disposes of his property prior to the

existence of the lien.   See Drye, 528 U.S. at 58; United States

v. McCombs, 30 F.3d 310, 323 (2d Cir. 1994).      The Government may

      1
       As Evseroff has asserted that the loss of his residence is
the only injury he suffered as a result of the district court’s
judgment, it is arguable that he lacks standing to appeal the
Government’s collection against the Trust’s remaining assets.
Nonetheless, because the Dover Street residence is the Trust’s
major asset, we conclude that Evseroff’s showing is sufficient to
permit him to prosecute his appeal.

                                  4
also seek to enforce such a lien against property held by the

taxpayer’s nominee or alter ego.       See G.M. Leasing Corp. v.

United States, 429 U.S. 338, 350-51 (1977) (“If petitioner

[corporation] was [taxpayer’s] alter ego . . . the Service could

properly regard petitioner’s assets as [taxpayer’s] property

subject to the lien under § 6321.”); see also Shades Ridge

Holding Co. v. United States, 888 F.2d 725, 728 (11th Cir. 1989)

(“Property of the nominee or alter ego of a taxpayer is subject

to collection of the taxpayer’s tax liability.”).

       We review de novo the district court’s determination that

Evseroff’s transfers to the Trust were actually fraudulent.

McCombs, 30 F.3d at 328.    The district court’s factual findings

underpinning those legal determinations are reviewed for clear

error.    United States v. Coppola, 85 F.3d 1015, 1019 (2d Cir.

1996).

       Whether Evseroff’s conveyances to the Trust were actually

fraudulent is a question of New York state law, in this case N.Y.

Debtor & Creditor Law § 276.    McCombs, 30 F.3d at 323, 327-28.

Section 276 provides that “[e]very conveyance made and every

obligation incurred with actual intent . . . to hinder, delay, or

defraud either present or future creditors, is fraudulent as to

both present and future creditors.”      N.Y. Debt. & Cred. Law §

276.   The burden of proving actual intent lies with the party

seeking to set aside the conveyance.       McCombs, 30 F.3d at 328.

                                   5
“Actual fraudulent intent must be proven by clear and convincing

evidence, but it may be inferred from the circumstances

surrounding the transaction, including the relationship among the

parties and the secrecy, haste, or unusualness of the

transaction.”   HBE Leasing Corp. v. Frank, 48 F.3d 623, 639 (2d

Cir. 1995).2

     Following our independent review of the entire record, we

identify no error in the district court’s conclusion that the

Government established, by clear and convincing evidence, that

Evseroff’s 1992 transfers of $220,000 in cash and the Dover

Street residence to the Trust were actually fraudulent.   The

majority of Evseroff’s arguments with respect to this issue seek

to elevate the district court’s underlying factual findings to

the level of “clear and convincing” proof of his actual intent.

For example, he argues, among other things, that: (1) the

district court’s conclusion that he thought that his Florida

     2
       Evseroff invites us to adopt the Federal Circuit’s
formulation of the clear and convincing standard of proof set out
in Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276
(Fed. Cir. 2011) (en banc). See id. at 1290-91 (holding, inter
alia, that under the clear and convincing evidence standard,
“when there are multiple reasonable inferences that may be drawn,
intent to deceive cannot be found”). We decline his invitation.
As we have previously stated in a case addressing a similar
actual fraudulent conveyance claim under N.Y. Cred. & Debt. Law §
267, we are “reluctant” to set aside the district court’s finding
of actual fraudulent intent where, as here, “the fraudulent
conveyance inquiry [consists of] merely a battle between the
‘badges’ [of fraud] on the one hand and inferences of [the
defendant’s] nonfraudulent motivation on the other.” McCombs, 30
F.3d at 328.

                                 6
residence would be exempt from seizure lacks support in the

record; and (2) the court improperly found that he did not

receive consideration for his transfers into the Trust.    The

findings of the district court on these matters are not

dispositive, direct evidence of Evseroff’s fraudulent intent.

Instead they constitute the district court’s underlying factual

findings regarding the “circumstances surrounding the

transaction,” see HBE Leasing, 48 F.3d at 639, from which, viewed

in their totality, Evseroff’s ultimate intent was to be inferred.

In addition, contrary to Evseroff’s assertions, both of the

district court’s conclusions find support in the record.

Accordingly, as we discern no error in the district court’s

application of the clear and convincing evidentiary standard to

the underlying facts and circumstances, we affirm for

substantially the same reasons stated by the district court in

its thorough and well-reasoned order dated April 30, 2012.3

     3
       As we affirm on the ground that the district court
properly found that Evseroff’s conveyances to the Trust were
actually fraudulent, we need not reach the court’s alternate
holdings that the Government could collect against the Trust
assets under the theories that the Trust was Evseroff’s nominee
or alter ego.

                                7
     We have considered all of Defendant’s remaining arguments

and find them to be without merit.    Accordingly, we AFFIRM the

judgment of the district court.

                              FOR THE COURT:
                              Catherine O’Hagan Wolfe, Clerk

                                  8