United States of America v. DeFazio et al

Filing 56

ORDER signed by District Judge John A. Mendez on 9/20/16 ORDERING that the United States' motion for summary judgment is GRANTED. The counter-motion of James P. DeFazio is DENIED. The United States is entitled to foreclose its liens against the Property which will be sold pursuant to further order of this Court. The United States is directed to file a motion for order of sale proposing terms and conditions, and the defendants may oppose this motion, and the Court will determine the terms and conditions of the sale. The sale will be free and clear of all interests asserted by the defendants in this case, with the liens to follow the sale proceeds. The Clerk is directed to enter a separate final judgment against Mr. DeFazio as set forth in this order. (Kastilahn, A)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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UNITED STATES OF AMERICA,

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Plaintiff,
v.

Case No. 2:14-cv-993-JAM-KJN
ORDER GRANTING MOTION FOR
SUMMARY JUDGMENT

JAMES P. DEFAZIO, et al.,

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Defendants.

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The United States filed a motion for summary judgment (ECF 32-37) against

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defendant James P. Defazio (“Mr. DeFazio”) seeking to reduce 14 years of tax liabilities

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to judgment and to enforce tax liens against Mr. DeFazio’s residence. Mr. DeFazio

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opposed the motion (ECF 40) and filed a counter motion for summary judgment (ECF

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44) seeking a ruling that the first four years of tax liabilities were barred by the applicable

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statute of limitations. The Court continued the initial hearing so that the United States

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could respond to the counter-motion.

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The DeFazio residence is located at 349 Wyndgate Road, Sacramento,

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California, 95864, in the County of Sacramento, State of California (the “Property”). The

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legal description of the Property is contained in the deed attached to the complaint filed

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in this case.

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On August 23, 2016, at 1:30 p.m., the Court, the Honorable James A. Mendez

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presiding, heard the two motions argued. G. Patrick Jennings appeared for the United

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States and Spencer Malysiak appeared for Mr. DeFazio. After hearing the argument and

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considering the papers filed, and for the reasons stated upon the record at the hearing, a

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copy of which is attached hereto, and for good cause shown,

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IT IS ORDERED THAT the motion of the United States is granted;

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IT IS FURTHER ORDERED THAT the counter-motion of James P. DeFazio is denied.

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IT IS FURTHER ORDERED THAT the United States is entitled to foreclose its liens

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against the Property which will be sold pursuant to further order of this Court. The

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United States is directed to file a motion for order of sale proposing terms and

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conditions, and the defendants may oppose this motion, and the Court will determine the

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terms and conditions of the sale. The sale will be free and clear of all interests asserted

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by the defendants in this case, with the liens to follow the sale proceeds.

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IT IS FURTHER ORDERED THAT the Clerk is directed to enter a separate final

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judgment against Mr. DeFazio as set forth below:

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JUDGMENT
1. James P. DeFazio is indebted to the United States in the amount of $249,123.58 for

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unpaid federal individual income tax (Form 1040) for the taxable years ending

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December 31, 1999, through and including December 31, 2012, plus interest

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according to 28 U.S.C. § 1961(c) and 26 U.S.C. §§ 6601, 6621(a)(2), from June 30,

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2016, until the judgment is paid.

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2. The DeFazio residence is located at 349 Wyndgate Road, Sacramento, California,

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95864, in the County of Sacramento, State of California (the “Property”). In

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accordance with the disclaimer of interest (ECF 5) filed by defendant Kathleen Ellis,

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the former spouse of Mr. DeFazio, Ms. Ellis is determined to have no interest in the

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Property.

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3. In accordance with the disclaimer of interest (ECF 6) filed by defendant William

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DeFazio Inc. Profit Sharing Plan and Money Purchase Pension Plan Dated

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9/14/1981, said plan is determined to have no interest in the Property.

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4. In accordance with the stipulation and order filed at ECF 10, the sale proceeds from
the sale of the Property will be distributed to the State of California and the County of
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Sacramento, in accordance with the priority set forth therein.

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5. In accordance with the stipulation and order filed at ECF 23, the sale proceeds from

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the sale of the Property will be distributed to defendants CITIBANK, N.A., and BANK

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OF AMERICA, N.A. in accordance with the priority set forth therein.

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6. The United States is entitled to foreclose its liens against the Property under 26

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U.S.C. § 7403, which will be sold pursuant to further order of this Court and upon the

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terms and conditions set by the Court.

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END OF JUDGMENT
IT IS SO ORDERED.

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Dated: 9/20/2016

/s/ John A. Mendez____________
JOHN A. MENDEZ
United States District Court Judge

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Approved as to form:
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/s Spencer Malysiak
Spencer Malysiak
Attorney for James DeFazio

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/s Stuart Smits
Stuart Smits
Attorney for James DeFazio
/s G. Patrick Jennings
G. Patrick Jennings
Trial Attorney,
U.S. Department of Justice

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