United States of America v. Luther et al

Filing 229

ORDER TO SHOW CAUSE - On or before May 5, 2014, each party with any pending claim will file a memorandum showing cause why the claim should not be dismissed by this Court due to lack of subject-matter jurisdiction, and why this Court should not enter a final judgment in the above-captioned matter. Show Cause Deadline set for 5/9/2014. Ordered by Chief Judge Laurie Smith Camp. (AOA)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
UNITED STATES OF AMERICA,
Plaintiff,

CASE NO. 8:12CV80

vs.
ATELIER PARTNERS, CYCLONE
ASSETS, SCOTT J. ESPARZA, BARRY
FEINER, GARY FROMM, JOSEPH M.
HALLER, as trustee for the Joseph E.
Haller Family Trust, KLEINWORT
BENSON (USA), INC., DRESDNER
KLEINWORT HOLDINGS, INC., GERALD
C. KORTH, PORTFOLIO RECOVERY
ASSOCIATES, LLC, TAG VIRGIN
ISLANDS, INC., ACCREDITED
COLLECTION SERVICE, INC., and
MSW CAPITAL, LLC,

ORDER TO
SHOW CAUSE

Defendants.

Fed. R. Civ. P. 12(h)(3) provides: “If the court determines at any time that it
lacks subject-matter jurisdiction, the court must dismiss the action.”
In the process of reviewing the pending claims in the above-captioned action, the
Court has attempted to verify its subject matter jurisdictions over any remaining claims
by defendants against the United States.
The Court’s original jurisdiction over this case appears to have been founded on
28 U.S.C §§ 1340 and 1345, and 26 U.S.C. (“I.R.C.”) §§ 7402 and 7403. Sections 1340
and 1345 of Title 28 give the federal district courts original jurisdiction over civil actions
“commenced by the United States, or by any agency or officer thereof expressly
authorized to sue by Act of Congress,” §1345, and arising “under any Act of Congress

providing for internal revenue . . . .” §1340. I.R.C. § 7402(e) gives the federal district
courts original jurisdiction over “any action brought by the United States to quiet title to
property if the title claimed by the United States to such property was derived from
enforcement of a lien under this title.”
The United States brought this action against Michael S. Luther and Laura
Dodge Luther to foreclose on its federal tax liens against real property allegedly
acquired by Laura Dodge Luther, as Michael S. Luther’s nominee. In bringing this
action, the United States sought to satisfy, or partly satisfy, Michael S. Luther’s unpaid
tax obligations.
Atelier Partners; Cyclone Assets; Scott J. Esparza; Barry Feiner; Gary Fromm;
Joseph M. Haller, as trustee for the Joseph E. Haller Family Trust; Kleinwort Benson
(USA), Inc.; Dresdner Kleinwort Holdings, Inc.; Gerald C. Korth; Portfolio Recovery
Associates, LLC; TAG Virgin Islands, Inc.; Accredited Collection Service, Inc.; and MSW
Capital, LLC, were all made parties to this action pursuant to I.R.C. § 7403 as persons
that may claim an interest in the real property against which the United States sought
foreclose to satisfy federal tax liens.
The United States has dismissed with prejudice all claims against Michael S.
Luther and Laura Dodge Luther. (Order of Dismissal, Filing No. 219.) Therefore, it
appears the Court no longer has jurisdiction over claims against the United States by
the remaining defendants made parties to this action pursuant to I.R.C. §7403.

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Accordingly,
IT IS ORDERED:
On or before May 5, 2014, each party with any pending claim will file a memorandum
showing cause why the claim should not be dismissed by this Court due to lack of subjectmatter jurisdiction, and why this Court should not enter a final judgment in the abovecaptioned matter.

Dated this 21st day of April, 2014.
BY THE COURT:
s/Laurie Smith Camp
Chief United States District Judge

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