United States of America v. Wanland

Filing 106

ORDER signed by District Judge Kimberly J. Mueller on 8/28/2017 DENYING 99 Motion for Relief under Rules 59(e) and 60(b)(4) and GRANTING 99 Motion for Relief under Rule 60(b)(1). The Court VACATES the 97 Order Adopting Findings and Recommendations and the 76 Motion for Summary Judgment is REMANDED to the Magistrate Judge for reconsideration in light of defendant's declaration. CASE REOPENED. (Donati, J)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 UNITED STATES OF AMERICA, 12 Plaintiff, 13 14 No. 2:13-cv-02343-KJM-KJN v. ORDER DONALD M. WANLAND, JR., 15 Defendant. 16 17 Pro se defendant Donald Wanland was held liable for tax evasion, and this court 18 19 granted judgment in favor of plaintiff the United States against Wanland for $1,065,493.30, plus 20 any statutory interest. ECF Nos. 97, 98. Defendant now moves the court to reconsider this 21 judgment under Federal Rule of Civil Procedure 59(e), or to set aside the judgment under Rule 22 60(b). Mot., ECF No. 99. The motion was submitted without oral argument. ECF No. 105. For 23 reasons explained below, the court GRANTS defendant’s motion in part, and DENIES 24 defendant’s motion in part. 25 I. BACKGROUND 26 The United States commenced this civil action against defendant, seeking a 27 determination under 11 U.S.C. § 523(a)(1)(C) that assessments for defendant’s federal tax 28 liabilities for tax years 1996, 1997, 1998, 2000, 2001, 2002 and 2003 were not discharged in 1 1 bankruptcy. See generally Compl. ECF No. 1. The United States also sought to reduce the tax 2 assessments to judgment. Id. After this court adopted findings and recommendations and denied 3 defendant’s motion to dismiss, ECF No. 27, plaintiff filed a motion for summary judgment, Mot. 4 Summ. J. (MSJ), ECF No. 76. On December 5, 2016, the magistrate judge filed findings and 5 recommendations recommending this court grant plaintiff’s motion for summary judgment. 6 Findings and Recommendations (F&R), ECF No. 90. This court adopted the findings and 7 recommendations on March 28, 2017, ordered defendant to pay the United States 8 “$1,065,493.30,” and closed the case. ECF No. 97. On April 25, 2017, defendant moved for 9 reconsideration of the court’s decision, and alternatively, to amend the judgment. Mot. The 10 United States opposed. Opp’n, ECF No. 102. Defendant replied. ECF No. 104. 11 II. 12 13 14 DISCUSSION A. Legal Standards Defendant moves for reconsideration under Rule 59(e), or in the alternative to vacate judgment under Rules 60(b)(1) and 60(b)(4). Mot. at 4, 19, 20. 15 1, 16 A Rule 59(e) motion is an “extraordinary remedy, to be used sparingly in the Rule 59(e) 17 interests of finality and conservation of judicial resources.” Kona Enters., Inc. v. Estate of 18 Bishop, 229 F.3d 877, 890 (9th Cir. 2000). A district court may grant a Rule 59(e) motion if it 19 “‘is presented with newly discovered evidence, committed clear error, or if there is an intervening 20 change in the controlling law.’” McDowell v. Calderon, 197 F.3d 1253, 1255 (9th Cir. 1999) 21 (en banc) (quoting 389 Orange St. Partners v. Arnold, 179 F.3d 656, 665 (9th Cir. 1999)). A 22 Rule 59(e) motion may not be used to raise arguments or present evidence for the first time when 23 they could reasonably have been raised earlier in the litigation. Kona, 229 F.3d at 890. 24 2. 25 Under Rule 60(b), the court may relieve a party or its legal representative from a 26 27 Rule 60(b) final judgment, order or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; 28 2 1 2 3 (2) newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud (whether previously called intrinsic or extrinsic), misrepresentation, or misconduct by an opposing party; 4 (4) the judgment is void; 5 6 (5) the judgment has been satisfied, released, or discharged; it is based on an earlier judgment that has been reversed or vacated; or applying it prospectively is no longer equitable; or 7 (6) any other reason that justifies relief. 8 9 Fed. R. Civ. P. 60(b). Here, defendant requests relief from judgment due to “excusable neglect,” 10 Mot. at 19 (citing Rule 60(b)(1)), and because he says the judgment is void, Mot. at 20 (citing 11 Rule 60(b)(4)). 12 In assessing “excusable neglect” under Rule 60(b)(1), the court must apply a four- 13 factor equitable test, examining: “(1) the danger of prejudice to the opposing party; (2) the length 14 of the delay and its potential impact on the proceedings; (3) the reason for the delay; and 15 (4) whether the movant acted in good faith.” Ahanchian v. Xenon Pictures, Inc., 624 F.3d 1253, 16 1261 (9th Cir. 2010) (citing Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’ship, 507 U.S. 17 380, 395 (1993); Briones v. Riviera Hotel & Casino, 116 F.3d 379, 381 (9th Cir. 1997) (adopting 18 this test for consideration of Rule 60(b) motions)). This assessment is known as the 19 “Pioneer/Briones equitable balancing test.” Id. Courts engaged “in balancing the Pioneer/ 20 Briones factors may not apply per se rules.” See id. (district court crafted an “impermissabl[e] . . . 21 per se rule” in concluding, without analysis, that “a calendaring mistake is the type of ‘inadvertent 22 mistake’ that is not entitled to relief pursuant to Rule 60(b)(1).”). 23 As Rule 60(b)(4) suggests, a court may relieve a party from a final judgment if 24 “the judgment is void.” United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 270 (2010). 25 “[A] void judgment is one so affected by a fundamental infirmity that the infirmity may be raised 26 even after the judgment becomes final.” Id. Such infirmities are extremely rare, as they must be 27 premised on “a certain type of jurisdictional error or on a violation of due process that deprives a 28 party of notice or the opportunity to be heard.” Dietz v. Bouldin, 794 F.3d 1093, 1096 (9th Cir. 3 1 2015). Judgments are generally considered void for jurisdictional defects only when “the court 2 that rendered judgment lacked even an ‘arguable basis’ for jurisdiction.” Whitsitt v. City of 3 Tracy, No.10–00528, 2016 WL 1357566, at *4 (E.D. Cal. Apr. 6, 2016) (citing Nemaizer v. 4 Baker, 793 F.2d 58, 65 (2d Cir. 1986)). With these standards in mind, the court assesses 5 defendant’s contentions below. 6 B. Rule 59(e) Arguments 7 Defendant raises three arguments for relief under Rule 59(e): (1) the magistrate 8 judge committed “clear error” in denying defendant an opportunity to present oral argument at 9 summary judgment, Mot. at 4; (2) the magistrate judge committed “clear error” in incorrectly 10 applying the doctrine of offensive collateral estoppel, id. at 5; and (3) the magistrate judge 11 committed “clear error” in denying his request to stay proceedings pending the outcome of the 12 criminal case and to allow for additional discovery, id. 15–17. The latter point in effect argues 13 this court committed error as well, in adopting the findings and recommendations. 14 In response to the first argument, plaintiff contends no oral argument is required. 15 Opp’n at 3. In response to arguments two and three, plaintiff contends because the magistrate 16 judge rejected these arguments “at least once already in the course of this action,” there is “no 17 good reason to revisit them now.” Opp’n at 4. Before considering the merits of defendant’s 18 argument, a discussion of “clear error” is warranted. 19 1. 20 “Clear error” occurs when “the reviewing court on the entire record is left with the Clear Error 21 definite and firm conviction that a mistake has been committed.” Smith v. Clark Cty. Sch. Dist., 22 727 F.3d 950, 955 (9th Cir. 2013). However, a district court does not commit clear error 23 warranting reconsideration when the question before it is a debatable one. See McDowell v. 24 Calderon, 197 F.3d 1253, 1256 (9th Cir. 1999) (district court did not abuse discretion in denying 25 reconsideration where it was debatable whether court could enter protective order in habeas 26 action limiting Attorney General’s use of documents from trial counsel’s file). The Ninth Circuit 27 has held it is not an abuse of discretion to deny a motion for reconsideration merely because the 28 4 1 underlying order is “erroneous,” rather than “clearly erroneous.” Id. at 1255 n.4. To obtain relief 2 here, defendant must convince this court, beyond debate, that a mistake “has been committed.” 3 2. 4 A district court may not, by rule or otherwise, preclude a party from requesting 5 oral argument, nor deny such a request when made by a party opposing a motion for summary 6 judgment unless the motion is denied. Dredge Corp. v. Penny, 338 F.2d 456, 462 (9th Cir. 1964). 7 However, an opportunity to be heard orally on questions of law “is not an inherent element of 8 procedural due process, even where substantial questions of law are involved.” Id. at 462 n.14; 9 accord Burchett v. Cardwell, 493 F.2d 492, 495 (9th Cir. 1974) (referencing Dredge in habeas Oral Argument 10 context). In any event, “the right of oral argument as a matter of procedural due process . . . 11 varies from case to case in accordance with differing circumstances.” Dredge Corp., 338 F.2d at 12 462 n.14. 13 Here, in opposing plaintiff’s motion for summary judgment, defendant requested 14 oral argument. See MSJ Opp’n at 9, ECF No. 83. The magistrate judge, however, submitted the 15 motion without oral argument. See F&R 1 n.2. In moving for summary judgment, plaintiff 16 requested the court make a determination, under 11 U.S.C. § 523(a)(1)(C), of assessments of 17 defendant’s tax liabilities for several tax years not discharged in bankruptcy, specifically 1996, 18 1997, 1998, 2000, 2001, 2002 and 2003. Id. at 2; MSJ at 2. Plaintiff also sought to reduce the tax 19 assessments to judgment. F&R at 2; MSJ at 2. Plaintiffs’ claims were inherently legal in nature 20 and resolution required little to no assessment of whether material facts were disputed. See F&R 21 at 10 (magistrate judge assessing “whether a particular exception to the general discharge applies” 22 (citing 11 U.S.C. § 523(a)(1)(C)). Where the magistrate judge did make factual determinations, he 23 reported that “defendant has not produced any controverting evidence,” and “the record before 24 the court reveal[ed] no genuine dispute” regarding defendant’s tax liability. F&R at 13. While 25 the court addresses the reliance on absence of controverting evidence below in its analysis of the 26 Rule 60(b) motion, defendant has not shown any prejudice flowing from the court’s denial of oral 27 argument; no oral argument was warranted because it would not have made a difference. See 28 Mahon v. Credit Bureau of Placer Cty. Inc., 171 F.3d 1197, 1200 (9th Cir. 1999) (no oral 5 1 argument warranted where “[b]oth parties provided the district court with complete memoranda 2 of the law and evidence in support of their respective positions,” and “[t]he only prejudice 3 [defendants] contend they suffered was the district court’s adverse ruling on the motion.”); 4 Houston v. Bryan, 725 F.2d 516, 518 (9th Cir. 1984) (relief from denial of oral argument 5 unwarranted absent a showing of prejudice). Defendant’s first argument does not afford relief. 6 3. 7 “[O]ffensive use of collateral estoppel occurs when the plaintiff seeks to foreclose Offensive Collateral Estoppel 8 the defendant from litigating an issue the defendant has previously litigated unsuccessfully in an 9 action with another party.” Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326 n.4 (1979); accord 10 Pena v. Gardner, 976 F.2d 469, 472 (9th Cir. 1992). Offensive collateral estoppel may be used 11 when: (1) there was a full and fair opportunity to litigate the issue in the previous action; (2) the 12 issue was actually litigated in that action; (3) the issue was lost as a result of a final judgment in 13 that action; and (4) the person against whom collateral estoppel is asserted in the present action 14 was a party or in privity with a party in the previous action. Pena, 976 F.2d at 472 (citing 15 CHARLES A. WRIGHT, LAW OF FEDERAL COURTS 682–85 (4th ed. 1983); Parklane Hosiery, 439 16 U.S. at 329)). 17 Here, plaintiff’s civil case alleged defendant attempted to evade taxes for the years 18 1996 to 1998 and 2000 to 2003. MSJ at 2; see Compl. at 2. The criminal proceedings brought 19 against defendant, however, pursued only charges for attempting to evade taxes for years 2000 to 20 2003. See Superseding Indictment 1, ECF No. 57-16; but see ECF No. 67-1 at 22 (tax levy 21 specifically referenced in indictment detailing tax years 1996, 1997, 1998, and 2000 to 2003). In 22 light of this tactical difference in pleading as opposed to charging, the magistrate judge explicitly 23 declined to reach the merits of the collateral estoppel issue and assumed without deciding the 24 doctrine of offensive collateral estoppel could not be applied with respect to the 1996 to 1998 25 taxes. F&R at 13. Instead, he relied on the evidence in the record, concluding there was “no 26 genuine dispute that defendant also willfully attempted to evade or defeat payment of his 1996– 27 1998 taxes.” Id. Accordingly, that plaintiff did not provide the requisite showing for offensive 28 collateral estoppel to apply for years 1996 to 1998 was of no import; the magistrate judge granted 6 1 plaintiff’s motion for alternative reasons, namely, that there was “no genuine dispute that 2 defendant also willfully attempted to evade or defeat payment of his 1996–1998 taxes.” Id. 3 Defendant’s second argument does not warrant relief. 4 4. 5 Defendant also contends the magistrate judge committed “clear error” in denying a Request to Stay Proceedings 6 request for stay (1) pending the outcome of his criminal appeal, and (2) to allow for additional 7 discovery. Mot. at 15–17. 8 9 Regarding the first argument, defendant contends the magistrate judge should have held off pending full completion of the criminal case, including awaiting resolution of any 10 petition for certiorari to the Supreme Court. Id. at 16. In December 2016, the magistrate judge 11 rejected defendant’s request for a stay after the Ninth Circuit earlier in the year had “affirmed the 12 judgment in defendant’s criminal case in all respects,” denied defendant’s petitions for panel 13 rehearing and rehearing en banc, and issued its mandate. F&R at 5; see also United States v. 14 Donald M. Wanland, Jr., Case No. 2:09-cr-8-LKK, ECF Nos. 263, 266, 301–03, 335–37 15 (mandate issued October 25, 2016). In other words, the magistrate judge awaited full resolution 16 in the Ninth Circuit before rejecting defendant’s request to stay. 17 Declining a stay to await a Supreme Court ruling, if a ruling is available, is not 18 “clear error.” On the contrary, the Ninth Circuit has held “once a federal circuit court issues a 19 decision, the district courts within that circuit are bound to follow it and have no authority to 20 await a ruling by the Supreme Court before applying the circuit court’s decision as binding 21 authority.” Yong v. I.N.S., 208 F.3d 1116, 1119 n.2 (9th Cir. 2000). Defendant’s first argument 22 regarding a stay is unavailing. 23 Defendant’s second argument also fails. Defendant contends he needed additional 24 discovery to make up for plaintiff’s “manifest discovery abuses.” Mot. at 17. Plaintiff was 25 sanctioned for its failure to adhere to its discovery obligations, and defendant was granted a 26 limited discovery extension. F&R at 5; see ECF No. 68 (magistrate judge ordered plaintiff’s 27 counsel to pay a monetary fine for discovery abuses). Defendant had not shown he was 28 ultimately prejudiced by the United States’ discovery misconduct in light of the relief he 7 1 obtained, so even further discovery was not warranted. F&R at 5; see generally Mot. His second 2 argument regarding a stay does not provide a basis for relief. 3 5. 4 Defendant has not shown any of his Rule 59(e) contentions warrant relief. 5 Summary Accordingly, the court proceeds to his arguments based on Rule 60(b). 6 C. Rule 60(b) Arguments 7 Defendant raises two arguments for relief under Rule 60(b): (1) his conduct 8 qualifies as “excusable neglect” because pending criminal proceedings precluded him from 9 raising a material dispute of fact in opposition to plaintiff’s motion for summary judgment, Mot. 10 at 19 (citing Rule 60(b)(1)); and (2) the magistrate judge’s findings and recommendations were 11 void upon issuance because the court lacked jurisdiction over plaintiff’s claims, Mot. at 20–21 12 (citing Rule 60(b)(4)). In response to the first argument, plaintiff contends defendant’s inability 13 to raise a triable issue of fact was attributed to a “strategic choice to withhold testimony,” and 14 thus does not fall within the ambit of “excusable neglect.” Opp’n at 4–5. Regarding the second 15 argument, plaintiff relies on the magistrate judge’s findings and recommendations, see Opp’n at 6 16 (citing F&R at 5–8), as discussed in more detail below. 17 1. 18 A brief explanation of defendant’s contention in this regard is warranted. Excusable Neglect 19 Defendant concedes he failed to raise a material dispute of fact regarding plaintiff’s claim that he 20 attempted to evade taxes for the years 1996 to 1998. Mot. at 20. He argues, however, because of 21 pending criminal proceedings against him for tax evasion, he could not adequately oppose 22 plaintiff’s motion for summary judgment without compromising his Fifth Amendment privilege 23 against self-incrimination. Id. As noted above, the court assesses defendant’s claim under the 24 “Pioneer/Briones equitable balancing test,” evaluating “(1) the danger of prejudice to the 25 opposing party; (2) the length of the delay and its potential impact on the proceedings; (3) the 26 reason for the delay; and (4) whether the movant acted in good faith.” Ahanchian, 624 F.3d at 27 1261. 28 8 1 a) Reason for Delay 2 For logical flow, the court assesses the third Pioneer/Briones factor first. This 3 prong considers defendant’s excuse for his failure to “file [needed information] on time,” and 4 assesses the excuse for reasonableness. Washington v. Ryan, 833 F.3d 1087, 1098 (9th Cir. 2016) 5 (“simply miscalculat[ing] the date for a [notice of appeal]” and filing one day late was “excusable 6 negligence.”). Defendant contends he could not present opposing evidence without 7 compromising his Fifth Amendment right against self-incrimination. Mot. at 19–20. He 8 presented this argument on several occasions throughout the case, including in his motion to 9 dismiss plaintiff’s complaint, ECF No. 17 at 6, objections to the magistrate judge’s findings and 10 recommendations to deny his motion to dismiss, ECF No. 25 at 3, his opposition to plaintiff’s 11 motion for summary judgment, see MSJ Opp’n at 37, objections to the magistrate judge’s 12 findings and recommendations to grant plaintiff’s motion for summary judgment, ECF No. 93 at 13 4, and the instant motion to vacate the judgment, Mot. at 4. In this motion, he contends the 14 magistrate judge’s grant of summary judgment for plaintiff erroneously overlooked potential 15 disputes of fact. Id. 16 The Fifth Amendment privilege against self-incrimination can be asserted in any 17 proceeding, civil or criminal, administrative or judicial, investigatory or adjudicatory, in which a 18 person reasonably believes the information sought, or discoverable as a result of his testimony, 19 could be used in a state or federal criminal proceeding. United States v. Balsys, 524 U.S. 666, 20 672 (1998) (citing Kastigar v. United States, 406 U.S. 441, 444–45 (1972)). The privilege 21 reflects a “complex of our fundamental values and aspirations, and marks an important advance in 22 the development of our liberty.” Kastigar, 406 U.S. at 444–45. Federal courts have been 23 “zealous to safeguard the values which underlie the privilege,” and thus should carefully consider 24 a person’s inability to produce testimony when such inability is linked to a reasonable fear of 25 prosecution. Id. 26 Here, plaintiff filed its motion for summary judgment on May 2, 2016. MSJ. 27 Under the court’s briefing deadlines, opposition briefs were due June 16, 2016, with reply briefs 28 due July 14, 2016. ECF No. 68. In compliance with court deadlines, defendant filed his 9 1 opposition on June 16, 2016. MSJ Opp’n. At the time, defendant was still mired in criminal 2 proceedings; defendant was convicted on September 26, 2013, Case No. 2:09-cr-8-LKK, ECF 3 No. 263, the Ninth Circuit would not affirm judgment in his criminal case until July 27, 2016, and 4 defendant’s subsequent request for panel rehearing and rehearing en banc would not be denied 5 until October 14, 2016, several months after his opposition was due. In light of the pending 6 appeal, defendant had reason to believe what he said in the civil proceeding could be used against 7 him in the pending criminal proceeding and he raised this issue before the magistrate judge on 8 several occasions. See ECF Nos. 17 at 6, 25 at 3; see also ECF No. 83 at 37 (“Defendant is faced 9 with the Hobbesian Choice of waiving his Fifth Amendment privilege now to present admissible 10 evidence to contradict the government's evidence in regard to the alleged assessments or maintain 11 the privilege and decline to present his rebuttal declaration on the merits.”). That his case was on 12 appeal before the Ninth Circuit following conviction did not make his fear of prosecution any less 13 reasonable. See e.g., United States v. Duchi, 944 F.2d 391, 394 (8th Cir. 1991) (“Government 14 may not convict a person and then, pending his appeal, compel him to give self-accusatory 15 testimony relating to the matters involved in the conviction”) (citing Frank v. United States, 347 16 F.2d 486, 441 (D.C.Cir. 1965)); Taylor v. Best, 746 F.2d 220, 222 (4th Cir. 1984) (“[I]t is 17 possible that post-conviction incriminating evidence could be used against an inmate who had 18 been convicted and sentenced but whose conviction was being appealed.”); Mills v. United States, 19 281 F.2d 736, 741 (4th Cir. 1960) (“Witness could not be compelled to testify where “at the time 20 of these proceedings in the case at bar, the period within which [witness] could prosecute an 21 appeal of her own conviction had not expired.”); see also MCCORMICK ON EVID. § 121 (7th ed. 22 2016) (“If direct appeal from a conviction is pending or remains available, a convicted defendant 23 might, despite his conviction, harbor hope that his conviction will be reversed on appeal and that 24 any disclosures he makes would be used to incriminate him upon any retrial that follows. 25 Because of this possibility, the courts have generally held that a convicted defendant retains the 26 protection of the privilege until appeal is exhausted or until the time for appeal expires.”). This 27 factor favors granting relief. 28 10 1 b) 2 Length of Delay and Potential Impact on the Judgment This second factor considers whether relief would amount to a “disruption to 3 efficient judicial administration posed by the late filings.” Pioneer Inv. Servs. Co., 507 U.S. at 4 397. “Late filings” include those made after entry of judgment. Briones v. Riviera Hotel & 5 Casino, 116 F.3d 379, 380 (9th Cir. 1997). The reason for defendant’s late filing is uncontested: 6 there was a pending criminal appeal reasonably precluding him from presenting an adequate 7 defense in the civil proceeding. Within a month of the Supreme Court’s denying a writ of 8 certiorari, defendant promptly filed a motion to amend the judgment, thereby lessening the chance 9 of disruption to efficient judicial administration. See Briones, 116 F.3d at 382 (Under Rule 10 60(b)(1), filing opposition to motion for summary judgment three and one-half months after 11 deadline could constitute excusable neglect). This factor favors granting relief. 12 c) 13 Danger of Prejudice This first factor considers the potential prejudice to plaintiff if the court grants 14 defendant’s request for relief. Pioneer Inv. Servs. Co., 507 U.S. at 397; Ryan, 833 F.3d at 1098. 15 Here, the court finds the danger of prejudice to be insubstantial. Plaintiff and the court have been 16 on notice of defendant’s desire to challenge the civil case on its merits once criminal proceedings 17 ended. Indeed, as noted above, throughout the civil case, defendant repeatedly contended he 18 could not produce evidence in opposition to plaintiff’s claims until his reasonable fear of criminal 19 prosecution abated. See MSJ Opp’n at 8; Obj. to MSJ F&R at 4, ECF No. 93. Plaintiff will not 20 be prejudiced if its claim is assessed on the merits, particularly given the court’s strong tradition 21 of favoring such resolution. See Ryan, 833 F.3d at 1098 (Rule 60(b)(4) relief warranted where 22 state had been on notice of opposing party’s contentions, even if untimely filed); see also 23 Andrews v. PRIDE Indus., No.14–02154, 2017 WL 119803, at *7 (E.D. Cal. Jan. 12, 2017) (In 24 absence of opposition to defendant’s motion for summary judgment on plaintiff’s federal and 25 state civil rights claims, the court takes “care to consider the merits.”). This factor favors granting 26 relief. 27 28 11 1 2 3 d) No one contends defendant did not move to vacate the judgment in good faith, and the record does not otherwise make any such showing. This factor favors granting relief. 4 5 Good Faith e) Summary On balance, the court finds defendant’s failure to present evidence in opposition to 6 plaintiff’s motion for summary judgment falls under the rubric of “excusable neglect.” 7 Accordingly, the court vacates the judgment in this case under Rule 60(b)(4) and remands the 8 matter to the magistrate judge to reassess plaintiff’s motion for summary judgment, taking into 9 consideration defendant’s declaration filed after his criminal proceedings were finally resolved. 10 The magistrate judge in his discretion may of course set a new briefing schedule or schedule any 11 proceedings he deems necessary to resolve the matter in light of this order. 12 2. 13 Defendant also contends this court lacks jurisdiction over this matter because: (1) Judgment Void 14 the action was not properly authorized; and (2) defendant’s prior bankruptcy proceeding 15 precluded this case under the doctrine of res judicata. Mot. at 20–21. 16 Defendant’s first contention is belied by the record; official letters attached to the 17 December 18, 2015 declaration of W. Carl Hankla, counsel for the United States, demonstrate the 18 action was authorized by appropriate delegates of the Secretary of the Treasury and the Attorney 19 General of the United States. ECF No. 67, Exs. 1, 2; Palmer v. United States Internal Revenue 20 Service, 116 F.3d 1309, 1311 (9th Cir. 1997) (“The government has produced redacted copies of 21 two letters, which taken together, show that the government complied with these statutory 22 requirements” that “civil actions for the collection of taxes and enforcement of liens be instituted 23 at the direction of delegates of the Attorney General and the Secretary of the Treasury.”). 24 Defendant’s second contention is similarly unavailing. His bankruptcy discharge, authorized 25 under 11 U.S.C. § 727, “did not discharge an individual debtor from any debt—for a tax . . . with 26 respect to which the debtor made a fraudulent return or willfully attempted in any manner to 27 evade or defeat such tax . . .” under 11 U.S.C. § 523(a)(1)(C), the statute undergirding plaintiff’s 28 civil claim. See Compl. at 6 (requesting that “the Court find, determine, and adjudge that, 12 1 pursuant to 11 U.S.C. § 523(a)(1)(C), Wanland’s tax debts are excepted from discharge in his 2 Chapter 7 bankruptcy case because Wanland willfully attempted to evade or defeat payment of 3 such tax.”). The court does not grant relief based on voidness. 4 III. SUMMARY AND CONCLUSION 5 The court DENIES defendant’s motion for relief under Rules 59(e) and 60(b)(4). 6 The court, however, GRANTS relief under Rule 60(b)(1). The case is REOPENED, this court’s 7 order adopting the magistrate judge’s findings and recommendations is hereby VACATED, and 8 proceedings on summary judgment are REMANDED to the magistrate judge for reconsideration 9 in light of defendant’s declaration filed at ECF No. 99. 10 This Order resolves ECF No. 99. 11 IT IS SO ORDERED. 12 DATED: August 28, 2017. 13 14 UNITED STATES DISTRICT JUDGE 15 16 17 18 19 20 21 22 23 24 25 26 27 28 13

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