United States Department of Justice, Tax Division v. Pflum et al

Filing 31

STIPULATION and ORDER signed by District Judge Morrison C. England, Jr. on 12/05/16 regarding lien priority by plaintiff USA and defendant State of CA Franchise Tax Board. (Benson, A)

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CAROLINE D. CIRAOLO
Principal Deputy Assistant Attorney General
HERBERT W. LINDER
U.S. Department of Justice
717 N. Harwood, Suite 400
Dallas, Texas 75201
[phone] or 880-9721
[phone] [fax]
[e-mail]
Attorney for the United States

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Of Counsel
BENJAMIN WAGNER
United States Attorney
Attorneys for the United States of America
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF CALIFORNIA
SACRAMENTO DIVISION

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UNITED STATES OF AMERICA,

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Plaintiff, STIPULATION REGARDING LIEN
PRIORITY BY PLAINTIFF UNITED
v.
STATES OF AMERICA AND
DEFENDANT STATE OF CALIFORNIA
FRANCHISE TAX BOARD
DAVID PFLUM, PILOT ENTERPRISE,
LLC, FRIDAY HARBOR WY, LLC,
STATE OF CALIFORNIA FRANCHISE
TAX BOARD, EL DORADO COUNTY,
SAN JOAQUIN COUNTY, CITY OF
STOCKTON, PLUMAS COUNTY, AMIR
AHMED,
Judge: The Hon. Morrison C. England, Jr.
Trial Date:
Not yet set
Defendants. Action Filed: December 23, 2015

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Case No. 2:15-CV-02659-MCE-CKD

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Plaintiff United States of America and Defendant State of California Franchise Tax Board,
through their respective counsel, hereby stipulate and agree as follows:
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Stipulation by Plaintiff United States of America and Defendant State of California Franchise Tax Board Regarding
Lien Priority (2:15-CV-02659-MCE-CKD)
14774576.1

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1.

The remaining real properties that are the subject of this tax lien foreclosure action

are 1274 Dedi Avenue, South Lake Tahoe, CA (1274 Dedi Property); and 1278 Dedi Avenue,
South Lake Tahoe, CA (1278 Dedi Property).
2.

The 1274 Dedi Property, APN 032-282-34-100, is fully described as follows:

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The land referred to herein below is situated in the City of South Lake Tahoe, County
of El Dorado, State of California, and described as follows:
Lot 85, Block 3, as shown on the Map of “Armstrong Subdivision No. 7” filed for
record June 29, 1954 in Block “B” of Maps, Page 39, El Dorado County Records.
(Compl. ¶ 32.)
3.

The 1278 Dedi Property, APN 032-282-343100, is fully described as follows:

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The land referred to herein below is situated in the City of South Lake Tahoe, County
of El Dorado, State of California, and described as follows:
Lot 84, Block 3, as shown on the Map of “Armstrong Subdivision No. 7” filed for
record June 29, 1954 in Block “B” of Maps, Page 39, El Dorado County.
(Compl. ¶ 33.)
4.

On May 16, 2013, the United States District Court for the District of Kansas entered a

default judgment in favor of the USA against Pflum in the amount of $6,408,357.25 as of March
14, 2013, plus interest and statutory additions for his 1997-2007 federal income tax liabilities and
his Form 941 tax liability for the fourth quarter of 1999. (J., ECF No. 21 [May 16, 2013],United
States v. David G. Pflum, Case No. 5:12-cv-04115 [D. Kan.].)
5.

On June 26, 2009, a Notice of Federal Tax Lien for Pflum’s 1997 through 2007

federal income tax liabilities was filed in the El Dorado County, CA Recorder’s Office.
6.

On July 28, 2009, a nominee Notice of Federal Tax lien was filed in the El Dorado

County, CA property records against Pilot Enterprise, LLC, as nominee of Pflum for his 1997
through 2007 federal income tax liabilities.
7.

On September 2, 2008, and October 7, 2008, Notices of Federal Tax Lien for Pflum’s

Form 941 federal tax liabilities, was filed in the El Dorado County, CA Recorder’s Office,
respectively. Pflum has Form 941 federal tax liabilities in the amount of $509,920.95 as of
8/14/2016,
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Stipulation by Plaintiff United States of America and Defendant State of California Franchise Tax Board Regarding
Lien Priority (2:15-CV-02659-MCE-CKD)
14774576.1

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8.

On September 16, 2008, FTB made a tax assessment against taxpayer and defendant

David Pflum in the amount of $69,861.34 based upon his failure to respond to FTB’s Demands to
File or Notice of Proposed Assessments for the 2004 tax year. Pflum’s 2004 California tax
liability arose from his sale of real property in California.
9.

FTB recorded a Notice of State Tax Lien against Pflum for the 2004 tax year on April

23, 2010, Certificate No. 1008333446 in El Dorado County.
10.

The United States and the State of California Franchise Tax Board hereby stipulate

and agree that the sales proceeds of the 1274 Dedi Property, and 1278 Dedi Property shall be paid
first to the United States in the amount of $509,920.95 plus interest and accruals from 8/14/2016,
then to the State of California Franchise Tax Board in the amount of $68,322.57 plus interest and
accruals from 10/21/2016, and then any remaining excess proceeds to the United States.
11.

This stipulation is to resolve the priority of liens at issue between the United States

and State California Franchise Tax Board in this case.

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Stipulation by Plaintiff United States of America and Defendant State of California Franchise Tax Board Regarding
Lien Priority (2:15-CV-02659-MCE-CKD)
14774576.1

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12.

Each party shall bear their own costs and attorneys fees.

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Respectfully submitted,

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KAMALA D. HARRIS
Attorney General of California
MOLLY K. MOSLEY
Supervising Deputy Attorney General

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/s/Jill Bowers
JILL BOWERS
Deputy Attorney General
Attorneys for Defendant State of California
Franchise Tax Board

Dated: November 17, 2016

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CAROLINE D. CIRAOLO
Principal Deputy Assistant Attorney General

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/s/Herbert W. Linder
HERBERT W. LINDER
Ohio Bar No. 0065446
Attorney, Tax Division
U.S. Department of Justice
Attorneys for Plaintiff United States of
America

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IT IS SO ORDERED.
Dated: December 5, 2016

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Stipulation by Plaintiff United States of America and Defendant State of California Franchise Tax Board Regarding
Lien Priority (2:15-CV-02659-MCE-CKD)
14774576.1