Eslami v. Koskinen

Filing 19

ORDER by Judge Claudia Wilken DENYING 11 MOTION TO DISMISS; DENYING 10 MOTION TO SEAL. (Attachments: # 1 Certificate/Proof of Service) (ndr, COURT STAFF) (Filed on 6/10/2014)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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A. ALI ESLAMI,
Plaintiff,

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United States District Court
For the Northern District of California

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No. C 14-0328 CW
ORDER DENYING
MOTION TO DISMISS;
DENYING MOTION TO
SEAL (Docket Nos.
10, 11)

v.
UNITED STATES OF AMERICA,
Defendant.
________________________________/

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Plaintiff Ali Eslami, proceeding pro se, brought this action
against Defendant United States of America, to obtain a refund for
overpayment of his 2007 federal income taxes.

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Defendant moves to

dismiss Plaintiff’s first amended complaint (1AC) for lack of
subject matter jurisdiction.

Plaintiff opposes the motion and

moves to seal certain information in his original complaint.
Defendant opposes the motion to seal.

The Court took both motions

under submission without oral argument and, after considering the
parties’ papers, denies both motions.
BACKGROUND

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Plaintiff alleges that he filed his 2007 federal income tax
return by mail on September 21, 2009.

1AC ¶ 5a.

One week later,

on September 28, he received a notice from the Internal Revenue
Service (IRS) stating that it had not received his 2007 tax return
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Although Plaintiff originally named the Commissioner of Internal
Revenue as the defendant, the Internal Revenue Code provides that claims
for tax refunds are properly brought against the United States, not the
Commissioner. 26 U.S.C. § 7422(f). Accordingly, the United States will
be substituted for the Commissioner as the defendant in this action.

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and that he must file the return immediately.

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2009 CP-516 Notice, at 1.

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IRS the following week to inform the agency that he had already

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filed his 2007 income tax return.

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responded by telling Plaintiff that his return might not have been

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entered into the agency’s system yet because it had been filed so

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recently but that he should assume that the return had been filed

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unless the agency sent him another notice about the matter in the

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next few weeks.

Id., Ex. 3, Sept.

Plaintiff claims that he contacted the

An IRS representative allegedly

Id. ¶ 5c.

United States District Court
For the Northern District of California

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According to the 1AC, Plaintiff did not receive another

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notice about his 2007 tax return until June 6, 2011 -- nearly two

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years after the IRS representative allegedly advised him to assume

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that his return had been filed.

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copy of his 2007 return in person at the IRS’s Oakland office on

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August 5, 2011.

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Plaintiff also filed a request for a $6,228.07 refund on his 2007

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federal income taxes, which the IRS denied in October 2011.

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its notice denying the request, the agency explained that,

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although Plaintiff was “due a refund of $6,228.07,” it could not

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issue the refund because the “statute of limitations for issuing a

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refund in [Plaintiff’s] case ha[d] expired.”

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2011 CP24 Notice, at 1.

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Id. ¶ 5f.

Plaintiff then filed a

Id., Ex. 7, Aug. 2011 Tax Return, at 1.

In

Id., Ex. 8, Oct.

Plaintiff appealed the denial of his refund request in

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February 2012 and the agency denied his appeal in April 2013.

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Plaintiff then filed the instant action in January 2014.

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1AC, he seeks a refund of $6,192 for overpayment on his 2007

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income taxes.

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In his

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DICSUSSION
I.

Motion to Dismiss

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A.

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Subject matter jurisdiction is a threshold issue which goes

Legal Standard

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to the power of the court to hear the case.

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matter jurisdiction must exist at the time the action is

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commenced.

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Equalization, 858 F.2d 1376, 1380 (9th Cir. 1988).

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court is presumed to lack subject matter jurisdiction until the

Morongo Band of Mission Indians v. Cal. State Bd. of

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United States District Court
For the Northern District of California

Federal subject

contrary affirmatively appears.

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A federal

Tribes, 873 F.2d 1221, 1225 (9th Cir. 1989).

Stock W., Inc. v. Confederated

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Dismissal is appropriate under Rule 12(b)(1) when the

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district court lacks subject matter jurisdiction over the claim.

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Fed. R. Civ. P. 12(b)(1).

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attack the sufficiency of the pleadings to establish federal

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jurisdiction, or allege an actual lack of jurisdiction which

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exists despite the formal sufficiency of the complaint.

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Publ’g Co. v. Gen. Tel. & Elecs. Corp., 594 F.2d 730, 733 (9th

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Cir. 1979); Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir.

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1987).

A Rule 12(b)(1) motion may either

Thornhill

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B.

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Federal district courts have original jurisdiction over any

Analysis

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civil action filed by a taxpayer “against the United States for

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the recovery of any internal-revenue tax alleged to have been

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erroneously or illegally assessed or collected, or any penalty

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claimed to have been collected without authority or any sum

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alleged to have been excessive or in any manner wrongfully

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collected under the internal-revenue laws.”
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28 U.S.C.

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§ 1346(a)(1); see also United States v. Clintwood Elkhorn Min.

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Co., 553 U.S. 1, 4 (2008) (“A taxpayer seeking a refund of taxes

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erroneously or unlawfully assessed or collected may bring an

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action against the Government either in United States district

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court or in the United States Court of Federal Claims.”).

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bringing such an action, however, the taxpayer must first file a

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claim for refund with the IRS that satisfies the requirements of

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Internal Revenue Code §§ 6511(a) and 6511(b)(2).

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Elkhorn, 553 U.S. at 5.

United States District Court
For the Northern District of California

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Before

Clintwood

In this case, Defendant contends that

Plaintiff’s refund claim does not satisfy § 6511(b)(2)(A).
Section 6511(b)(2)(A) “imposes a ceiling on the amount of

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credit or refund to which a taxpayer is entitled as compensation

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for an overpayment of tax.”

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432 (2000).

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refund “shall not exceed the portion of the tax paid within the

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period, immediately preceding the filing of the claim, equal to 3

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years plus the period of any extension of time for filing the

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return.”

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that this provision is jurisdictional in nature.

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F.3d 1360, 1364 (9th Cir. 1996).

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action to recover a tax refund but did not make any payments

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toward the relevant tax during the period set forth in

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§ 6511(b)(2)(A), the court lacks jurisdiction over the claim.

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To establish that the Court lacks jurisdiction over

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Plaintiff’s refund claim under § 6511(b)(2)(A), Defendant must

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demonstrate (1) that Plaintiff actually paid his 2007 taxes and

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(2) that he did so more than three years before he filed his 2007

Baral v. United States, 528 U.S. 431,

Specifically, it provides that the amount of any

26 U.S.C. § 6511(b)(2)(A).

The Ninth Circuit has held
Zeier v. IRS, 80

Thus, if a taxpayer files an

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tax return.

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showing but not the second.

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1.

As explained below, Defendant has made the first of

Date of Plaintiff’s 2007 Tax Payment

The undisputed evidence shows that Plaintiff’s 2007 taxes

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were deemed paid in April 2008.

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both the version he filed in August 2011 and the version he claims

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to have filed in September 2009 -- make clear that he sought to

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pay his 2007 taxes using a credit balance that remained from

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estimated payments which he had previously made toward his 2006

Plaintiff’s 2007 tax returns --

United States District Court
For the Northern District of California

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taxes.

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are “deemed to have been paid on the last day prescribed for

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filing the return . . . for such taxable year (determined without

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regard to any extension of time for filing such return).”

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last day prescribed for individuals to file their 2007 federal

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income tax returns was April 15, 2008.

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regardless of when Plaintiff actually filed his return, his 2007

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taxes would have been deemed paid in April 2008.

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U.S. at 439 (holding that “the date of payment is determined

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according to the provisions of § 6513, which, as noted, plainly

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set a deemed date of payment for remittances of withholding and

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estimated income tax on the April 15 following the relevant

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taxable year,” even in cases where the return itself is filed well

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after that date (citations omitted)).

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Under Internal Revenue Code § 6513(b)(2), these payments

2.

26 U.S.C. § 6072.

The

Thus,

See Baral, 528

Date of Plaintiff’s 2007 Tax Return Filing

As noted above, Plaintiff asserts that he filed his 2007

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federal tax return on September 21, 2009.

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Although he has not provided a registered mail receipt showing

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that he mailed the return on that date, he has submitted other
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Eslami Decl. ¶ 6.

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extrinsic evidence to support his assertion.

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has submitted a copy of his 2007 state tax return, which he filed

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in person with the Franchise Tax Board on September 21, 2009.

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Eslami Decl. ¶¶ 3-5; 1AC, Ex. 1, 2007 Cal. Tax Return, at 1-2.

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Plaintiff asserts that he filed a copy of his completed 2007

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federal tax return with his state return and has submitted a copy

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of his 2007 federal return that bears a signature date of

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September 21, 2009.

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at 2.

In particular, he

Id., Ex. 2, 2007 Cal. Tax Return Attachment,

Plaintiff also notes that the IRS stopped sending him

United States District Court
For the Northern District of California

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notices about his 2007 return after September 2009 -- shortly

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after he claims to have filed that return -- despite sending him

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monthly notices directing him to file the return in July, August,

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and September 2009.

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2 (documenting how the IRS issued notices to Plaintiff in July

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2009 and August 2009); 1AC, Ex. 3, Sept. 2009 CP-516 Notice, at 1.

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Although the IRS eventually sent him another notice about his 2007

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tax return in June 2011, the length and timing of the delay

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between that notice and the prior notices about the 2007 return

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provides further circumstantial support for Plaintiff’s claim that

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he filed his 2007 return in September 2009.

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Plaintiff’s evidence is sufficient to support jurisdiction under

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§ 6511(b)(2)(A) at this stage.

See Newman Decl., Ex. A,

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IRS Account Tr., at

Taken together,

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Defendant’s counsel refers to this document as Exhibit A in his
declaration but mistakenly labeled the document as “Exhibit B.”
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with an IRS representative in October 2009 because he has not presented
any sworn evidence that those communications occurred. Although he
refers to those communications in his complaint and his opposition
brief, he does not refer to them in his declaration. Because the Court
does not rely on those alleged communications here, Defendant’s
arguments regarding the relevance of these communications are moot.

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Defendant contends that this evidence is not sufficient to

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support a September 2009 filing date.

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Code § 7502, which codifies the common law “mailbox rule” by

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“allow[ing] a taxpayer to prove timely filing on the basis of

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timely mailing notwithstanding the date of physical delivery of

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the tax return to the IRS.”

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487, 490 (9th Cir. 1992).

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establish a prima facie case of timely filing by presenting a

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receipt of certified or registered mail postmarked on or before

It cites Internal Revenue

Anderson v. United States, 966 F.2d

That provision enables a taxpayer to

United States District Court
For the Northern District of California

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the applicable deadline.

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(providing that, for tax returns submitted by registered mail,

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“registration shall be prima facie evidence that the return,

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claim, statement, or other document was delivered to the agency,

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officer, or office to which addressed”).

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however, preclude Plaintiff from relying on other evidence to

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establish the date of filing.

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expressly held, “Neither the language of [§ 7502] nor Ninth

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Circuit precedent bars admission of extrinsic evidence to prove

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timely delivery” of a tax return for the purposes of § 6511.

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Anderson, 966 F.2d at 491.

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district court’s order relying on an attorney’s testimony that she

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saw a postal clerk postmark her client’s tax return.

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Circuit held that the attorney’s testimony “provided direct proof

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of a timely postmark because she actually saw the postal clerk

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stamp her document.”

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declaration asserting that he witnessed a postal clerk postmark

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his 2007 tax return, he has provided other extrinsic evidence --

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the authenticity of which Defendant has not disputed -- to support

Id.

See, e.g., 26 U.S.C. § 7502(c)(1)

The provision does not,

In fact, the Ninth Circuit has

In Anderson, the court affirmed a

The Ninth

Although Plaintiff has not provided a

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his claim that he mailed the return in September 2009.

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Furthermore, Plaintiff may be able to provide further factual

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details about when, where, and how he mailed his return to the

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IRS.

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return remains in dispute, Plaintiff’s refund claim should not be

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dismissed for lack of subject matter jurisdiction.

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Accordingly, because the date when Plaintiff filed his tax

Defendant’s reliance on Sorrentino v. IRS, 383 F.3d 1187
(10th Cir. 2004), is misplaced for several reasons.

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Sorrentino is inapposite because it addressed a situation where

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United States District Court
For the Northern District of California

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the taxpayers’ only evidence of timely filing consisted of self-

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serving declarations.

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declarations of mailing, without more, are insufficient to invoke

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[a] presumption” that a tax return was received (emphasis added)).

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Here, in contrast, Plaintiff has provided other circumstantial

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evidence, discussed above, to support his claim that he mailed his

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tax return in September 2009.

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decided the jurisdictional question at the summary judgment stage,

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rather than the motion to dismiss stage; it therefore had a more

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complete evidentiary record before it when it decided the

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jurisdictional issue.

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Tenth Circuit and might have been decided differently under this

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circuit’s precedents.

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specifically highlighted the similarities between the taxpayers’

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evidence in that case and the evidence that the Ninth Circuit

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found sufficient in Anderson.

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(Seymour, J., dissenting) (“I question why [the taxpayer’s

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evidence in Anderson] is substantially more convincing than that

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presented by the Sorrentinos, including the sworn testimony of Mr.

First,

Id. at 1191 (stating that “[s]elf-serving

Second, the Sorrentino court

Finally, Sorrentino was decided by the

The dissenting judge in Sorrentino

See Sorrentino, 383 F.3d at 1198

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and Mrs. Sorrentino that they signed the return in early March,

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the sworn testimony of Mr. Sorrentino that he mailed the return in

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early March, and a copy of the return dated March 1, 1998.”).

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all of these reasons, Sorrentino does not support dismissal of

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Plaintiff’s claims here.

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II.

For

Motion to Seal

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A.

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The public interest favors filing all court documents in the

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Legal Standard

public record.

Thus, any party seeking to file a document under

United States District Court
For the Northern District of California

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seal must demonstrate good cause to do so.

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Creditors Ass’n, 605 F.3d 665, 678 (9th Cir. 2010).

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be established simply by showing that the document is subject to a

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protective order or by stating in general terms that the material

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is considered to be confidential, but rather must be supported by

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a sworn declaration demonstrating with particularity the need to

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file each document under seal.

Pintos v. Pac.
This cannot

See Civil Local Rule 79–5(a).

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B.

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Plaintiff moves to redact certain information contained in

Analysis

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various documents attached to his original complaint.

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that this information is sealable pursuant to Federal Rule of

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Civil Procedure 5.2.

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He contends

That rule provides that

in an electronic or paper filing with the
court that contains an individual’s socialsecurity number, taxpayer-identification
number, or birth date, the name of an
individual known to be a minor, or a
financial-account number, a party or nonparty
making the filing may include only: (1) the
last four digits of the social-security number
and taxpayer-identification number; (2) the
year of the individual’s birth; (3) the
minor’s initials; and (4) the last four digits
of the financial-account number.
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Fed. R. Civ. P. 5.2.

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After reviewing the documents attached to Plaintiff’s

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original complaint, the Court finds that all of this information

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has already been properly redacted.

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that Plaintiff has identified in his reply brief do not contain

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any information sealable under Rule 5.2.

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not identified any other grounds for sealing this information, his

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request to redact information contained in the attachments to his

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original complaint must be denied.

United States District Court
For the Northern District of California

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The pages of these documents

Because Plaintiff has

CONCLUSION
For the reasons set forth above, Defendant’s motion to

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dismiss (Docket No. 11) and Plaintiff’s motion to seal (Docket No.

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10) are DENIED.

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Defendant shall file its answer to Plaintiff’s 1AC within

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fourteen days of this order.

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held at 2:00 p.m. on July 2, 2014 in courtroom 2 of the Oakland

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federal courthouse, located at 1301 Clay Street.

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A case management conference will be

The Court refers Plaintiff to its handbook for pro se

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litigants, which is available online at: http://www.cand.uscourts.

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gov/prosehandbook.

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Center, located on the fourth floor of the Oakland federal

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courthouse in Room 470S, for further advice.

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the Legal Help Center may be made in person or by phone at 415-

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782-8982.

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Plaintiff may also consult the Legal Help

Appointments with

IT IS SO ORDERED.

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Dated: 6/10/2014

CLAUDIA WILKEN
United States District Judge
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