Francis et al v. United States of America

Filing 29

ORDER granting 14 motion to dismiss. All claims are dismissed with prejudice for lack of subject matter jurisdiction. Signed on 5/4/17 by Chief District Judge Greg Kays. (Strodtman, Tracy)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
WESTERN DIVISION
BRAD STEPHEN FRANCIS and
CHRISTINE CAROL FRANCIS,
Plaintiffs,
v.
UNITED STATES OF AMERICA,
Defendant.

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No. 4:16-cv-0672-DGK

ORDER GRANTING MOTION TO DISMISS
This lawsuit arises out of pro se Plaintiffs Brad and Christine Francis’ belief that they do
not owe any income taxes or penalties for fiscal years 2010 through 2015. Plaintiffs contend all
their income during this period was exempt from tax and, therefore, incorrectly reported as
income by third parties.

As a remedy, Plaintiffs request the Court issue injunctive relief

requiring the Kansas City Area Director of the Internal Revenue Service (“IRS”) to issue
refunds, withdraw penalties, and refrain from taking further action against them.
Now before the Court is Defendant United States of America’s motion to dismiss (Doc.
14). Defendant contends that since early 2014 Plaintiffs have been attempting to avoid their
obligations to pay federal income taxes. Defendant argues Plaintiffs’ claims are based on “tax
protester” arguments that courts have repeatedly rejected.
Holding that the Court lacks subject matter jurisdiction to hear Plaintiffs’ claims,
Defendant’s motion is GRANTED. The Court dismisses all claims with prejudice.

Background
Plaintiffs’ First Amended Complaint lists six counts,1 but it contains more than six claims
because some of Plaintiffs’ causes of action, such as their claim(s) brought pursuant to 26 U.S.C.
§ 7433, are pled in the “Jurisdictional Allegations” section. See, e.g., Am. Compl. ¶¶ 13-15.
All of the claims seek injunctive relief (that is, writs of mandamus), instructing the
Kansas City Area Director of the IRS to issue refunds to Plaintiffs, and to refrain from imposing
tax penalties on them or otherwise use his authority against them. Am. Compl. ¶¶ 206-07, 25355, 272-74, 294-96, 333-35, 344. Plaintiffs’ claims stem from their allegations that the IRS
wrongly rejected Plaintiffs’ Forms 1040 and 1040X for multiple years in which Plaintiffs
claimed zero wages, zero compensation, and zero income from other sources, despite filings
from third parties indicating Plaintiffs had, in fact, received such income.
Standard
Defendant moves to dismiss the First Amended Complaint (Doc. 5) under Federal Rules
of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction and 12(b)(6) for failure to state
a claim upon which relief can be granted. Because Defendant’s subject matter jurisdiction
arguments are dispositive, the Court need not address the 12(b)(6) arguments.
Dismissal under Rule 12(b)(1) is appropriate where the court lacks subject matter
jurisdiction to hear the case. There are two types of challenges to subject matter jurisdiction
under Rule 12(b)(1), “facial” attacks and “factual” attacks. Osborn v. United States, 918 F.2d
724, 729 n.6 (8th Cir. 1990). A facial attack challenges subject matter jurisdiction based on the
bare allegations in the complaint, and the Court assumes the allegations in the complaint are true.

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Claim One is for “Mala Fides Appeals,” Claim Two asserts “Intrinsic Fraud,” Claim Three alleges “Malicious
Assessment,” Claim Four pleads “Assault with Intent,” Count Five brings a claim(s) of “Tampering; Unlawful Use
of the Courts,” and it is somewhat unclear what Count Six pleads. It is captioned “Count Six.”

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A factual attack considers matters extrinsic to the pleadings to determine if it has subject matter
jurisdiction.
Discussion
The pending motion is a facial attack because Defendant argues that even if the First
Amended Complaint’s allegations are true, the Court lacks subject matter jurisdiction because:
(1) the Anti-Injunction Act prohibits the requested relief; (2) writs of mandamus are not available
against the United States; (3) the Court cannot consider Plaintiffs’ refund claims because they
have not complied with the jurisdictional prerequisites to bring a tax refund suit against the
United States; and (4) the Court cannot hear Plaintiffs’ purported claim under 26 U.S.C. § 7433
because it does not provide jurisdiction for lawsuits challenging tax assessments, only for
damages stemming from unauthorized tax collections.
Plaintiffs respond that they are seeking judicial review under 5 U.S.C. § 702 and under 26
U.S.C. § 7433. Suggestions in Opp’n 13-14 (Doc. 18). They contend the Court has jurisdiction
under § 7433 because the First Amended Complaint makes allegations about collection
activities. Id. at 13. Finally, they contend that writs of mandamus are their only remedy to stem
Defendant’s lawlessness and escalating abuse against them. Id.
The Court rules as follows.
First, the Anti-Injunction Act prohibits Plaintiffs’ request for injunctive relief. The AntiInjunction Act provides that, subject to certain statutory exceptions that Plaintiffs have not
argued are applicable here, “no suit for the purpose of restraining the assessment or collection of
any tax shall be maintained in any court by any person.” 26 U.S.C. § 7421(a); see Judicial
Watch, Inc. v. Rossotti, 317 F.3d 401, 405 (4th Cir. 2003) (noting “courts lack jurisdiction to
issue injunctive relief in suits seeking to restrain the assessment or collection of taxes”). The

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purpose of 26 U.S.C. § 7421 is to protect the collection of revenue and minimize pre-collection
judicial intervention with that process. See South Carolina v. Regan, 465 U.S. 367, 376 (1984).
In this case, Plaintiffs request to enjoin the Kansas City Area Director of the IRS from imposing
tax penalties, or using his authority against Plaintiffs, would violate the Anti-Injunction Act.
Therefore, these claims must be dismissed for lack of subject matter jurisdiction.
Second, Plaintiffs’ claims seeking writs of mandamus must be dismissed because
injunctive relief is available against an officer or employee of the United States only, not the
United States itself. Granted, the Amended Complaint specifically seeks a writ enjoining the
Kansas City Area Director of the IRS, an employee of the United States, but this individual was
not named in the lawsuit so the Court lacks personal jurisdiction over him. The United States is
the only Defendant, and injunctive relief is not available against it.
Third, the Court lacks jurisdiction to hear any refund claims because Plaintiffs have failed
to comply with jurisdictional prerequisites before filing suit. As a threshold matter, Plaintiffs are
seeking refunds: all six enumerated claims seek a “refund” for different amounts. Am. Compl.
¶¶ 206, 253, 272, 294, 334, 344. But the statutory authority for waiving sovereign immunity to
sue for a tax refund provides that taxpayers may not bring refund suits “until a claim for refund
or credit has been duly filed with the Secretary [of the Treasury], according to the provisions of
law in that regard, and the regulations of the Secretary.” 26 U.S.C. § 7422(a). While a tax return
or amended tax return can be an administrative refund claim, 26 C.F.R. § 301.6402-3(a)(5),
Plaintiffs purported tax returns improperly identifying zero income are not duly filed refund
claims. Waltner v. United States, 679 F.3d 1329, 1333-34 (Fed. Cir. 2012) (collecting cases).
Plaintiffs’ returns improperly identified zero income, despite informational returns from third
parties showing such income, as well as Plaintiffs’ own signed returns for the 2010-2012 fiscal

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tax years attesting to having such income. See Am. Compl. ¶¶ 54-55, 61, 150-53. Because
Plaintiffs have not filed a proper refund claim for any tax year, they have not exhausted their
administrative remedies, and this Court lacks jurisdiction over their claims.
Fourth, Plaintiffs’ purported § 7433 claims must be dismissed for lack of subject matter
jurisdiction because the statute allows lawsuits for damages stemming from unauthorized tax
collections only, not lawsuits such as Plaintiffs’ challenging a tax assessment. Section 7433(a)
states, in relevant part:
If, in connection with any collection of Federal tax with respect to
a taxpayer, any officer or employee of the Internal Revenue
Service recklessly or intentionally, or by reason of negligence
disregards any provision of this title, or any regulation
promulgated under this title, such taxpayer may bring a civil action
for damages against the United States in a district court of the
United States.
26 U.S.C. § 7433(a) (emphasis added). It is a means for taxpayers to challenge tax collections,
not tax assessments. Kim v. United States, 632 F.3d 713, 716 (D.C. Cir. 2011) (“Section 7433
applies only to collection-related activities.”).

The Amended Complaint asserts the IRS

improperly assessed taxes and penalties against the Plaintiffs. For example, paragraph 62 alleges
Plaintiffs’ corrected returns represent their true liability; and paragraph 64 alleges the IRS erred
by ignoring this evidence in assessing Plaintiffs’ tax liabilities. Am. Compl. ¶¶ 62, 64. Although
Plaintiffs argue paragraphs 276 through 293 specifically make allegations regarding collection
activities, a close reading of these allegations shows that they all rest on claims that Defendant
erred in assessing their taxes and imposing penalties. See, e.g., Am. Compl. ¶¶ 276, 278. The
Amended Complaint does not allege the IRS disregarded any Internal Revenue statute or
regulation in connection with any collection activities against them. Hence, the Court lacks
jurisdiction to hear these claims.
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Finally, Plaintiffs assertion that 5 U.S.C. § 702 provides the Court with subject matter
jurisdiction is unavailing. Section 702 entitles any person wronged by an agency action to
judicial review, except where any other statute expressly or impliedly forbids the relief sought.2
Here, the statutes Plaintiffs are invoking to sue provide narrow waivers of sovereign immunity
which expressly forbid Plaintiffs from bringing this type of lawsuit. Consequently, § 702 does
not provide subject matter jurisdiction for this lawsuit.
Conclusion
For the reasons discussed above, Defendant’s motion (Doc. 14) is GRANTED. All
claims are dismissed with prejudice for lack of subject matter jurisdiction.
IT IS SO ORDERED.
Date:

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May 4, 2017

/s/ Greg Kays
GREG KAYS, CHIEF JUDGE
UNITED STATES DISTRICT COURT

It states:
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. The United States may be named as a defendant in any such
action, and a judgment or decree may be entered against the United States:
Provided, That any mandatory or injunctive decree shall specify the Federal
officer or officers (by name or by title), and their successors in office, personally
responsible for compliance. Nothing herein (1) affects other limitations on
judicial review or the power or duty of the court to dismiss any action or deny
relief on any other appropriate legal or equitable ground; or (2) confers authority
to grant relief if any other statute that grants consent to suit expressly or
impliedly forbids the relief which is sought.

5 U.S.C. § 702 (emphasis added).

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