Canady v. Internal Revenue Service et al

Filing 22

ORDER AND OPINION (1) SUBSTITUTING PARTY AND (2) GRANTING DEFENDANT'S MOTION TO DISMISS, 15 . Signed on 4/9/15 by District Judge Ortrie D. Smith. (Order mailed to Myrtle Canady.) (Matthes, Renea)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
WESTERN DIVISION
MYRTLE M CANADY,

)
)
Plaintiff,
)
)
vs.
)
)
INTERNAL REVENUE SERVICE, et al. )
)
Defendants.
)

Case No. 14-0952-CV-W-ODS

ORDER AND OPINION (1) SUBSTITUTING PARTY AND (2) GRANTING
DEFENDANT’S MOTION TO DISMISS
Pending is Defendant United States of America’s (“Defendant”) Motion to
Dismiss. Doc. #15. For the reasons set forth below, the Court dismisses Plaintiff’s case
without prejudice for a lack of jurisdiction.
I.

Background

Plaintiff Myrtle Canady (“Plaintiff”) brought this suit against the Internal Revenue
Service (“IRS”); Lester J. West, Director of HUD; the Social Security Administration;
Lynn Marten, Assistant Regional Commissioner; Dennis Onnen, Special Assistant U.S.
Attorney; and William B. Edgerly, Revenue Officer. Plaintiff is seeking to recover money
the IRS allegedly took from her through fraud. The Complaint does not set forth a clear
factual basis for her claim. However, in her Response she alleges she reached an
agreement with Defendant Edgerly “to pay a certain amount in settlement for taxes.”
Response, p.3. Plaintiff maintains she paid the agreed upon amount, but Defendant
Edgerly did not apply her payment. Id. As best the Court can discern, Plaintiff asserts
that as a result of this, “the Social Security Administration is wrongfully deducting money
from her [Social Security] benefits for premiums for Medicare and paying that money to
the IRS.” Id. at 2.
II.

Legal Standard

“[F]ederal courts are courts of limited jurisdiction.” Dakota, Minnesota & E.R.R.

Corp. v. Schieffer, 715 F.3d 712 (8th Cir. 2013) (citations omitted). The party invoking
federal jurisdiction has the burden of establishing that it exists. Id.; see also Jones v.
United States, 727 F.3d 844, 846 (8th Cir. 2013); Bowe v. N.W. Airlines, Inc., 974 F.2d
101, 103 (8th Cir. 1992). “Without jurisdiction the court cannot proceed at all in any
cause. Jurisdiction is power to declare the law, and when it ceases to exist, the only
function remaining to the court is that of announcing the fact and dismissing the cause.”
Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 94 (1998).
III.

Discussion

A. Real Party in Interest
Defendant contends this case should be deemed an action exclusively against
the United States. The Court agrees. First, a federal agency committed each action
she alleges. See Coleman v. Espy, 986 F.2d 1184, 1189 (8th Cir. 1993). Second, to
the extent Plaintiff brings this action against government officials, the Eighth Circuit has
repeatedly held that, “If a plaintiff’s complaint is silent about the capacity in which [she]
is suing the defendant, we interpret the complaint as including only official-capacity
claims.” Baker v. Chisom, 501 F.3d 920, 923 (8th Cir. 2007) (citations and quotations
omitted). This rule also applies to pro se complaints. Gingras v. Wood, 294 F. App’x.
241, 241-42 (8th Cir. 2008). Here, Plaintiff’s Complaint is silent as to the capacity in
which she is suing the individual defendants, and thus, the Court finds that she brings it
against them only in their official capacity.1 A claim against a government official in his
or her official capacity is, in essence, a claim against the entity he or she represents, in
this case the United States. Coleman, 986 F.2d at 1189.
Finally, the Westfall Act provides immunity to federal employees from claims of
“injury or loss of property, or personal injury or death arising or resulting from the
negligent or wrongful act or omission” committed while acting within the scope of
employment. 28 U.S.C. § 2679(b)(1). Any action against a government official that falls
under the coverage of § 2679(b)(1) is deemed to be an action against the United States.
1

Plaintiff argues in her Response that this action should be construed as against Defendant
William B. Edgerly in his individual capacity. However, nowhere in Plaintiff’s Complaint does she make
allegations against Defendant Edgerly specifically, nor does she indicate in her Complaint that she is
suing him in his individual capacity.

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United States v. Smith, 499 U.S. 160, 163 (1991). Here, Plaintiff’s Complaint describes
actions by federal employees in the scope of their employment. For all these reasons,
the Court finds Plaintiff’s Complaint is an action exclusively against the United States.

B. Tort Claim
Because the Court construes Plaintiff’s Complaint as against the United States,
sovereign immunity is applicable. It is well-settled that “sovereign immunity shields the
Federal Government and its agencies from suit.” Fed. Deposit Ins. Corp. v. Meyer, 510
U.S. 471, 475 (1994).2 However, Congress can waive sovereign immunity if it does so
clearly and unequivocally.3 U.S. v. Moser, 586 F.3d 1089, 1095-1096 (8th Cir. 2009).
To the extent Plaintiff asserts a tort claim, the Federal Torts Claim Act (“FTCA”)
provides “a limited waiver of the United States’s sovereign immunity, to permit persons
injured by federal-employee tortfeasors to sue the United States for damages in federal
district court.” Mader v. United States, 654 F.3d 794, 797 (8th Cir. 2011). However, this
Court lacks subject matter jurisdiction to hear Plaintiff’s claim for several reasons. First,
a “district court does not have jurisdiction over an FTCA claim unless it was first
presented to the appropriate federal agency…within two years of when the claim
accrued.” Allen v. U.S., 590 F.3d 541, 544 (8th Cir. 2009) (citations and quotations
omitted). Here, Plaintiff asserts in her Response that she has exhausted her
administrative remedies. Doc. #20, p. 5. There is no indication that Plaintiff has

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Plaintiff generally points to 5 U.S.C. § 702 in support of the proposition that this Court does have
subject matter jurisdiction to hear her claims. However, this statutory provision does not aid Plaintiff.
Section 702 provides:
a person suffering legal wrong because of agency action, or adversely affected or aggrieved by
agency action within the meaning of a relevant statute, is entitled to judicial review thereof. An
action in a court of the United States seeking relief other than money damages and stating a
claim that an agency or an officer or employee thereof acted or failed to act in an official capacity
or under color of legal authority shall not be dismissed nor relief therein be denied on the ground
that it is against the United States or that the United States is an indispensable party.
(emphasis added). Here, Plaintiff is seeking money damages. Complaint, p. 2. Thus, this statutory
provision is inapplicable to Plaintiff’s action.
3
Plaintiff cites Department of Army v. Blue Fox, Inc. in support of the proposition that
“Congress…has waived its immunity for a wide range of suits, including those that seek traditional money
damages.” 525 U.S. 255, 260 (1999). Unfortunately, Plaintiff takes this quote out of context. While
Congress has waived sovereign immunity in certain actions for money damages, it has only done so in
specifically prescribed contexts. The Supreme Court cited the FTCA and the Tucker Act as examples of
this type of waiver of sovereign immunity. Id. As discussed further in this Order and Opinion, neither the
FTCA nor the Tucker Act provide this Court with jurisdiction to hear Plaintiff’s claims.

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actually done so. To the contrary, she asserts in her Response that she “has claims but
can get no direction about where to file or present the claim…” Doc. #20, p. 4.
Regardless, even if the facts in Plaintiff’s Response are to be believed, Plaintiff’s
Complaint on its face must allege sufficient facts to state a plausible claim for relief.
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In her Complaint, Plaintiff asserts she has
not presented any of the claims made in this lawsuit through any type of administrative
procedure within any government agency. Complaint, p. 3. Thus, Plaintiff has not
satisfied a jurisdictional requirement for bringing an FTCA claim in this Court.
Second, the FTCA does not waive sovereign immunity for certain types of torts,
such as “any claim arising out of…misrepresentation [or] deceit.” 28 U.S.C. § 2680(h).
This exception to the sovereign immunity waiver includes claims for fraud. United
States v. Perry, 706 F.2d 278, 279-80 (8th Cir. 1983). Here, Plaintiff asserts the
“Internal Revenue Service…took my money through fraud…” Complaint, p. 2. Finally,
the FTCA does not waive sovereign immunity for “any claim arising in respect of the
assessment or collection of any tax…” 28 U.S.C. § 2680(c).
Accordingly, to the extent Plaintiff asserts a tort claim, the Court lacks jurisdiction
to adjudicate this claim.

C. Tax Refund
To the extent Plaintiff asserts a claim seeking a refund from the IRS, the Court
also lacks subject matter jurisdiction to hear this claim. “The United States has given its
consent to be sued for refunds of federal taxes in a carefully articulated statutory
scheme, otherwise sovereign immunity would bar such a suit.” Hansen v. U.S., 248
F.3d 761, 763 (8th Cir. 2001). However, in order to bring suit for a tax refund, “the
taxpayer must have paid the disputed tax in full and have ‘duly filed’ an administrative
claim for a refund.” Id. at 764. Plaintiff’s Complaint does not satisfy either of these
requirements. She has not alleged that she has paid the disputed tax in full or that she
filed an administrative claim for a refund.
Plaintiff asserts in her Response to Defendant’s Motion to Dismiss that she paid
by cashier’s check a certain amount in settlement for taxes. Doc. #20, p. 3. Plaintiff
also asserts in her Response that she has exhausted her administrative remedies. Doc.
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#20, p. 5. As previously discussed in Section III.B, it is not entirely clear that Plaintiff
actually has filed an administrative claim for a refund. Again, she asserts in her
Response that she “has claims but can get no direction about where to file or present
the claim…” Doc. #20, p. 4. Even if the facts in Plaintiff’s Response are to be believed,
Plaintiff’s Complaint on its face must allege sufficient facts to state a plausible claim for
relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In her Complaint, Plaintiff does not
assert that she has paid the disputed tax in full. Additionally, Plaintiff asserts she has
not presented any of the claims made in this lawsuit through any type of administrative
procedure within any government agency. Complaint, p. 3. Accordingly, to the extent
Plaintiff asserts a claim for a tax refund, this Court lacks subject matter jurisdiction to
adjudicate that claim.

D. Non Tort Claim
To the extent Plaintiff asserts a non-tort claim, the Tucker Act denies this Court
jurisdiction to adjudicate that claim. 28 U.S.C. § 1491(a)(1). The Tucker Act provides:
The United State Court of Federal Claim shall have jurisdiction to render
judgment upon any claim against the United States founded either upon the
Constitution, or any Act of Congress or any regulation of an executive
department, or upon any express or implied contract with the United States, or
for liquidated or unliquidated damages in cases not sounding in tort.
Id. Further, the Court of Federal Claims has exclusive jurisdiction to hear these types of
claims that exceed $10,000. Eastern Enterprises v. Apfel, 524 U.S. 498, 520 (1998).
Here, Plaintiff has asserted claims for millions of dollars. Complaint, p. 2. Accordingly,
to the extent Plaintiff asserts a non-tort claim, this Court lacks subject matter jurisdiction
to hear this claim.

E. Social Security Claim
To the extent Plaintiff meant to contest the Social Security Administration’s ruling
on an application for Social Security benefits, this type of claim also is barred. The
Social Security Act outlines the manner in which judicial review of these types of claims
occurs. See 42 U.S.C. 405(g). As previously discussed in Section II.B and C, while

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Plaintiff asserts in her Response that she has exhausted her administrative remedies,
the Court finds that her Complaint, on its face, does not allege sufficient facts to
demonstrate that she actually has exhausted her administrative remedies. Moreover,
she presents little, if any, facts to support this type of claim. Thus, the Court presently
lacks jurisdiction to hear a Social Security claim.

IV.

Conclusion

Accordingly, the Court grants Defendant’s Motion to Dismiss. Because the
reasons discussed above provide sufficient grounds for the Court to grant Defendant’s
Motion to Dismiss, the Court need not address Defendant’s remaining arguments in
support of its Motion to Dismiss.

IT IS SO ORDERED.
/s/ Ortrie D. Smith
ORTRIE D. SMITH, SENIOR JUDGE
UNITED STATES DISTRICT COURT

DATE: April 9, 2015

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