United States of America v. Boursiquot et al

Filing 165

ORDER ADOPTING IN PART REPORT AND RECOMMENDATIONS re 164 Report and Recommendations. The Motion for Order to Show Cause (ECF No. 147 ) is granted in part and denied in part. Signed by Judge Robert N. Scola, Jr on 5/27/2021. See attached document for full details. (mc)

United States District Court
for the
Southern District of Florida
United States of America, Plaintiff,
v.
Jean-Philippe Boursiquot and
others, Defendants.

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) Civil Action No. 17-60550-Civ-Scola
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Order Adopting In Part Report and Recommendations
The Court referred the government’s motion for order to show cause to
United States Magistrate Judge Alicia Otazo-Reyes for a report and
recommendation. After two show cause hearings, Judge Otazo-Reyes issued a
report and recommendation, recommending that the Court grant the
government’s motion in part and deny in part, finding that the Defendant JeanPhillippe Boursiquot had violated this Court’s August 18 permanent injunction,
and recommending sanctions against the Defendant (R. & R., ECF No. 164.) No
objections to the report and recommendation have been filed by either party
and the time to do so has passed. The Court has considered—de novo—Judge
Otazo-Reyes’s report, the record, and the relevant legal authorities. The Court
finds Judge Otazo-Reyes’s report and recommendation cogent and compelling.
The Court adopts in part the report (ECF No. 164) and grants in part and
denies in part the government’s motion (ECF No. 147) as follows.
1. Background
On August 8, 2018, the Court entered a permanent injunction against
Boursiquot, enjoining him from directly or indirectly preparing or filing federal
tax returns for any person other than himself, receiving fees from any tax
return preparation related to taxes from 2017 and future years, and from
owning or operating any tax preparation business. (Permanent Injunction, ECF
No. 141.)
On November 30, 2020, the government filed a motion for an order to
show cause and for a finding of civil contempt for violation of the permanent
injunction. (Gov. Mot. for Order to Show Cause, ECF No. 147.) In support of its
motion, the government cites to the sworn declaration of investigator Tony
Gonzalez and contends that it continued monitoring Boursiquot and learned
that Boursiquot prepared 2019 tax returns for several individuals. (Decl. Tony

Gonzalez, ECF No. 147-1.) Mr. Gonzalez attests that he spoke with Ettory
Jean-Mary who stated that he had entered into a business agreement with
Boursiquot. Jean-Mary allowed Boursiquot to use his preparer tax
identification number and business name and location to prepare 2018 and
2019 tax returns, in exchange Jean-Mary received 30% of Boursiquot’s profits.
(ECF No. 147-1 ¶¶ 5, 8.) At the government’s request, Jean-Mary provided a
list of 56 individuals who purportedly had their 2019 tax returns filed by
Boursiquot. (Id. ¶ 10; Customer List, ECF No. 147-2.) The customer list
indicated that the total amount of fees charged by Jean-Mary’s business for the
56 tax returns was $20,315.25. (Id.) Boursiquot kept 70% of that amount or
$14,220.00 (ECF No. 147 at 4.) Eleven of those customers spoke to Mr.
Gonzalez and all stated that Boursiquot prepared their 2019 federal tax returns
in exchange for a preparation fee that was deducted from the tax refunds. (ECF
No. 147-1 ¶¶ 13, 14.)
Boursiquot, represented by counsel, responded to the government’s
motion and denied that he had violated the terms of the permanent injunction.
(Boursiquot Resp., ECF No. 153 at 1.) In his sworn declaration, Boursiquot
states that he referred any previous clients for which he prepared tax returns
for to George Jean-Mary (brother of Ettory Jean-Mary). Boursiquot also
submitted the declaration of Jona Jackson, one of the persons interviewed by
the government investigator, in which she attests that Boursiquot prepared her
taxes prior to 2018 and that in 2018, he did not prepare her taxes and referred
her to George Jean-Mary. (Decl. Jona Jackson, ECF No. 154-1.)
On January 14, 2021, Judge Otazo-Reyes held a show cause hearing
during which she found that the government had not met its burden of
showing a violation of the permanent injunction. (ECF No. 164 at 3.) Judge
Otazo-Reyes explained that the government’s motion was based entirely on the
hearsay statements and continued the hearing to allow the government to
submit sworn testimony from individuals who claimed Boursiquot prepared
their tax returns.
At the continued show cause hearing on March 10, 2021, the
government explained that it served subpoenas on six individuals out of the
original eleven the government spoke to. Of these six, Desiree M. Demaio,
Rochelle Smith, Bridget Janots, and Linda Collins stated under oath, in an
affidavit and at depositions, that Boursiquot prepared their federal tax returns
for 2018 and 2019. (ECF Nos. 158, 161, 162.) In her affidavit, Ms. Demaio
attests that in “2019, I met Phil in person, and I provided my 2018 W-2
statements,” and in “2020, I emailed Phil my W-2s, and he was able prepare
my 2019 tax return because he had all the information that I previously
provided.” (Aff. Desiree Demaio, ECF No. 158). Ms. Smith testified in a

deposition that Boursiquot prepared her 2018 and 2019 federal tax returns
and charged her a $500 fee. (Dep. Rochelle Smith, ECF No. 160 16:15-19.) Ms.
Janots and Ms. Collins had similar accounts, testifying at their respective
depositions that Boursiquot prepared their tax returns for 2018 and 2019.
(Dep. Bridget Janots, ECF No. 161 15:18-25, 16:1-2; Dep. Linda Collins, ECF
No. 162 10:15-19.) The government conceded that the fifth and sixth
individuals, Jona Jackson and Marallis Burgess, stated that Boursiquot did
not prepare their federal taxes.
On March 24, 2021, Judge Otazo-Reyes issued a report and
recommendation in which she certified the facts recited in the previous
paragraph, and found “by clear and convincing evidence, that Boursiquot
violated the explicit terms of this Court’s August 8, 2018 Permanent Injunction
by preparing Ms. Demaio, Ms. Smith, Ms. Janots, and Ms. Collins’ 2018 and
2019 federal tax returns.” (ECF No. 164 at 5.) Judge Otazo-Reyes
recommended that the appropriate sanction for Boursiquot’s contemptuous
conduct and to deter him from further contemptuous conduct, is the
imposition of a $500 fine for each person for whom he prepared the tax
returns, resulting in a total fine of $2,000. (Id. at 5.) Judge Otazo-Reyes also
recommended that the government be awarded its reasonable attorney’s fees
and costs for the prosecution of the subject motion and the fees related to
investigation of Boursiquot’s conduct. (Id.)
After careful consideration, the Court agrees with Judge Otazo-Reyes
finding of civil contempt but disagrees with her recommendation as to
sanctions as more fully explained below. The government’s motion is granted in
part and denied in part. (ECF No. 147.)
2. Analysis
In order to prove civil contempt, the petitioner must prove by clear and
convincing evidence that either the underlying order, or the court’s directives,
was violated. Howard Johnson Co. v. Khimani, 892 F.2d 1512, 1516 (11th
Cir.1990) (citations omitted). The proper focus of the court’s inquiry into a civil
contempt petition is not the subjective belief or intent of the alleged contemnor,
but whether the order was in fact violated. Id. at 1516 (citations omitted).
“[O]nce the moving party makes a prima facie showing that the court order was
violated, the burden of production shifts to the alleged contemnor to show a
‘present inability to comply that goes beyond a mere assertion of inability.’
” Khimani, 892 F.2d at 1516 (citations omitted); United States v. Hayes, 722
F.2d 723, 725 (11th Cir.1984) (citing Maggio v. Zeitz, 333 U.S. 56, 74–78, 68
S.Ct. 401, 411–412, 92 L.Ed. 476 (1948)).

Here, the government proved by clear and convincing evidence that
Boursiquot violated the permanent injunction. Indeed, there is uncontested
evidence that four individuals stated under oath that Boursiquot prepared their
tax returns for 2018 and 2019. Accordingly, the burden shifts to Boursiquot to
show an inability to comply with this Court’s order. Boursiquot’s defense was
not that he could not comply, rather he argues that he did not violate the
Court’s order. Although he submitted his own declaration and that of Jona
Jackson, he did not submit evidence to discredit the sworn statements of four
individuals. Accordingly, the report is adopted in this regard and the Court
finds Mr. Boursiquot in civil contempt.
Next, the Court must determine what sanction is appropriate under the
circumstances. After careful consideration, the Court finds that Judge OtazoReyes erred in imposing a $2,000 fee in addition to attorney’s and investigation
fees. The $2,000 fee constitutes a punitive sanction for which Boursiquot has
not been afforded the necessary due process.
“Sanctions in civil contempt proceedings may be employed for either or
both of two purposes: to coerce the defendant into compliance with the court’s
order, and to compensate the complainant for losses sustained.”
In re McLean, 794 F.3d 1313, 1323 (11th Cir. 2015) (quoting F.T.C. v.
Leshin, 719 F.3d 1227, 1231 (11th Cir.2013)). By contrast, punitive sanctions
are only intended to punish, and it is immaterial whether the contemnor is in
compliance at the time the sanctions are imposed. In re McLean, 794 F.3d at
1323. “Because punitive sanctions are for offenses already completed, they
take on the character of criminal punishment and render the contempt
criminal in nature.” Id. Moreover, whether the award is coercive or punitive
determines the due process requirements the court owes to the contemnor. “At
most, due process requires only ‘skeletal’ protections in civil contempt
proceedings: a show-cause order providing notice and a hearing in which the
alleged contemnor, who may be represented by counsel, can introduce evidence
rebutting the allegation of contempt and testify on its own behalf. Id. at 1324.
On the other hand, criminal contempt “is a crime in the ordinary sense, and so
due process requires more stringent protections in criminal contempt
proceedings.” Id. An alleged contemnor must also be presumed innocent,
proved guilty beyond a reasonable doubt and afforded a jury trial for serious
contempt. Id.
In her report, Judge Otazo-Reyes recommends the imposition of a $2,000
fine “for Boursiquot’s contemptuous conduct, and to deter him from further
contemptuous conduct.” (ECF No. 164 at 5.) However, that is not the question
in a civil contempt case. Instead, the inquiry is what sanction will coerce
Boursiquot to comply with the permanent injunction and compensate the

government? First, there is no evidence that Boursiquot is currently in violation
of the permanent injunction. Indeed, the government adduced no evidence that
Boursiquot intends to prepare 2020 taxes for other persons in 2021. Because
there is no need for a coercive fee, the fee takes on the nature of a punitive
sanction for which Boursiquot has not received the necessary due process.
Accordingly, the recommendation is rejected on this point.
The Court agrees with Judge Otazo-Reyes, however, that a sanction is
necessary to compensate the government for its efforts investigating Boursiquot
and pursuing this motion. The Court finds that fees and costs connected to the
investigation and the prosecution of the motion are fair and sufficient to deter
the Defendant from further contemptuous conduct. Accordingly, the report is
adopted on this ground. By June 11, 2021, and after meaningful conferral, the
government is directed to file an application for reasonable fees and costs in
accordance with S.D. Fla. L.R. 7.3.
3. Conclusion
For these reasons, the government’s motion is granted in part and
denied in part. (ECF No. 147.) The Court adopts Judge Otazo-Reyes’s
recommendations in so far as she finds civil contempt and recommends an
award of reasonable attorney’s fees and costs and investigation costs.
Done and ordered, at Miami, Florida, on May 27, 2021.
________________________________
Robert N. Scola, Jr.
United States District Judge