GRAHAM et al v. DEPARTMENT OF THE TREASURY INTERNAL REVENUE SERVICE

Filing 38

MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE GERALD J. PAPPERT ON 11/17/21. 11/17/21 ENTERED AND COPIES NOT MAILED TO PRO SE.(rf, )

Case 2:21-cv-01411-GJP Document 38 Filed 11/17/21 Page 1 of 7

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
ROLAND GRAHAM,
Plaintiff,
v.
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE,
Defendant.

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CIVIL ACTION NO. 21-CV-1411

MEMORANDUM
PAPPERT, J.

NOVEMBER 17, 2021

Roland Graham, a prisoner currently incarcerated at the Philadelphia Industrial
Correctional Center (“PICC”), filed this pro se civil case against the Department of the
Treasury Internal Revenue Service (“IRS”) asserting that he did not receive his federal
stimulus checks. For the reasons that follow, the Complaint will be dismissed without
prejudice pursuant to 28 U.S.C. § 1915(e)(2)(B)(ii).
I
On March 24, 2021, Graham, along with several other prisoners incarcerated at
PICC, filed a Complaint against the IRS with respect to their alleged failure to receive
their federal stimulus checks. (ECF No. 2.) The Complaint was signed by Graham, as
well as Cesar Saez, Charles Green, Fernando Miraye, Antwon Richard, Durward Allen,
Doug Weiser, Andre Davis, Nafece Martin, and Wykeem Bass. (ECF No. 2 at 12.) As of
the filing of the Complaint, none of the Plaintiffs paid the fees necessary to commence a
civil action in this court or filed an application to proceed in forma pauperis along with
a certified copy of his prisoner account statement. On April 9, 2021, the Court granted
each Plaintiff thirty days to correct the initial filing deficiencies and directed the Clerk

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of Court to furnish each Plaintiff with a blank copy of this Court’s standard prisoner in
forma pauperis form to be used if a Plaintiff sought leave to proceed in forma pauperis.
(ECF No. 5.) Following the April 9, 2021 Order, the Court granted all named Plaintiffs
multiple extensions of time to correct the initial deficiencies, ultimately allowing each
Plaintiff more than three months to either pay the fees necessary to commence a civil
action or file an application to proceed in forma pauperis. (See ECF Nos. 5, 11, 25, 33.)
Only Graham filed a Motion to Proceed In Forma Pauperis, as well as a prisoner
account statement, on his own behalf. (See ECF Nos. 12, 19, 20, 22-24.) On July 12,
2021, the Court granted Graham leave to proceed in forma pauperis pursuant to 28
U.S.C. § 1915. (ECF No. 25.) Because none of the other named Plaintiffs paid the fees
necessary to commence a civil action or filed an application to proceed in forma
pauperis along with a certified copy of his prisoner account statement, the Court
dismissed each of them without prejudice. (ECF No. 36.)
Graham’s allegations are brief.1 He asserts that the IRS “cannot deny economic
impact payments” under the “CARES Act” to incarcerated individuals. (ECF No. 2 at
4.) Graham seeks an order directing the IRS “to immediately release [his] 3 stimulus
checks” he has not yet received. (Id. at 6.) He also seeks compensatory damages in the
amount of $50,000 and punitive damages in the amount of $50,000. (Id. at 9.)

Graham’s Complaint cites to Rule 23 of the Federal Rules of Civil Procedure, which
governs class actions, and he has also repeatedly referred to this matter as a class action.
(ECF No. 2.) Although pro se litigants who are not lawyers may represent themselves, they
may not pursue claims on behalf of others, including a class of other inmates. See Hagan v.
Rogers, 570 F.3d 146, 158-59 (3d Cir. 2009) (“[W]e do not question the District Court’s
conclusion that pro se litigants are generally not appropriate as class representatives.”);
Lewis v. City of Trenton Police Dep’t, 175 F. App’x 552, 554 (3d Cir. 2006) (per curiam)
(“Lewis, who is proceeding pro se, may not represent a putative class of prisoners.”).
Accordingly, this case cannot proceed as a potential class action.
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II
Graham is proceeding in forma pauperis. (ECF No. 25.) Accordingly, 28 U.S.C. §
1915(e)(2)(B)(ii) applies, which requires the Court to dismiss the Complaint if it fails to
state a claim. Whether a complaint fails to state a claim under § 1915(e)(2)(B)(ii) is
governed by the same standard applicable to motions to dismiss under Federal Rule of
Civil Procedure 12(b)(6), see Tourscher v. McCullough, 184 F.3d 236, 240 (3d Cir. 1999),
which requires the Court to determine whether the complaint contains “sufficient
factual matter, accepted as true, to state a claim to relief that is plausible on its face.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quotations omitted). “At this early stage of
the litigation,’ ‘[the Court will] accept the facts alleged in [the pro se] complaint as true,’
‘draw[] all reasonable inferences in [the plaintiff’s] favor,’ and ‘ask only whether [that]
complaint, liberally construed, . . . contains facts sufficient to state a plausible [] claim.’”
Shorter v. United States, 12 F.4th 366, 374 (3d Cir. 2021) (quoting Perez v. Fenoglio, 792
F.3d 768, 774, 782 (7th Cir. 2015)). Conclusory allegations do not suffice. Iqbal, 556
U.S. at 678. Moreover, “if the court determines at any time that it lacks subject-matter
jurisdiction, the court must dismiss the action.” Fed. R. Civ. P. 12(h)(3). As Graham is
proceeding pro se, the Court construes his allegations liberally. Vogt v. Wetzel, 8 F. 4th
182, 185 (3d Cir. 2021) (citing Mala v. Crown Bay Marina, Inc., 704 F.3d 239, 244-45
(3d Cir. 2013)).
III
Graham filed this case pursuant to the Coronavirus Aid, Relief, and Economic
Security Act. Pub. L. No. 116-136, 134 Stat. 281 (2020). The CARES Act was signed
into law on March 27, 2020 as part of the Government’s response to the 2020
coronavirus pandemic. Section 2201 of the statute created a “recovery rebate,”

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structured as a $1,200 tax credit for eligible individuals. 26 U.S.C. § 6428. The tax
credit was treated as an “advance refund,” meaning qualified individuals would directly
receive the rebate as an economic impact payment or so called “stimulus check.” Id. §
6428(f). The CARES Act directs the Secretary of the Treasury to issue the credit “as
rapidly as possible” and specifies that no impact payment “shall be made or allowed”
after December 31, 2020. Id. § 6428(f)(3)(A). Graham seeks a belated stimulus
payment.
As Graham has named the IRS as a Defendant, the first issue that must be
addressed is whether the United States has waived its sovereign immunity for claims
under the CARES Act. At least two other courts have found that the United States has
waived sovereign immunity for claims brought under the CARES Act. See Amandor, et
al. v. Mnuchin, 476 F. Supp. 3d 125, 141-45 (D. Md. Aug. 5, 2020); R.V. v. Mnuchin,
Civ. A. No. 20-1148, 2020 WL 3402300, at *5-7 (D. Md. June 19, 2020). Construing
Graham’s allegations liberally, the Court will assume at this early juncture and
without definitively determining that the United States has waived its sovereign
immunity for his claim based on the reasoning in Amandor and R.V.
The next question is whether a person seeking payment under the CARES Act
must exhaust administrative remedies by first filing a claim for a refund with the IRS
pursuant to 26 U.S.C. § 7422. The R.V. court rejected the IRS’s argument that a refund
action is a necessary prerequisite to bringing claims under the CARES Act stating, “[b]y
its plain language, § 7422(a) does not apply here because [a claim seeking an advance
refund stimulus payment] is not a suit for any tax, penalty, or sum wrongfully
collected.” R.V., 2020 WL 3402300, at *7; see also, Amandor, 476 F. Supp. 3d at 143-44
(noting that requiring the exhaustion of administrative remedies before proceeding

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with a CARES Act claim “is at odds with the very purpose of the impact payments”).
Again, construing Graham’s allegations liberally, the Court will assume without
deciding that no exhaustion is required since Graham is not challenging an “internal
revenue tax alleged to have been erroneously or illegally assessed or collected, or of any
penalty claimed to have been collected without authority, or of any sum alleged to have
been excessive or in any manner wrongfully collected.” 26 U.S.C. § 7422.
Nonetheless, Graham’s case is not plausible and must be dismissed under §
1915(e)(2)(B) because he lacks standing to bring his claim. Article III of the
Constitution limits the power of the federal judiciary to the resolution of cases and
controversies. Sprint Commc’ns Co., L.P. v. APCC Servs., Inc., 554 U.S. 269, 273
(2008). “That case-or-controversy requirement is satisfied only where a plaintiff has
standing.” Id. “[T]he irreducible constitutional minimum of standing contains three
elements.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992). First, the plaintiff
must have suffered an “injury in fact” that is “concrete and particularized” and “actual
or imminent, not conjectural or hypothetical.” Id. (internal quotations omitted).
Second, there must be a “causal connection between the injury and the conduct
complained of” such that the injury is fairly traceable to the defendant’s conduct. Id.
Third, it must be likely that the plaintiff’s injury will be redressed by a favorable
decision. Id. at 561; see also Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016)
(explaining that the “irreducible constitutional minimum of standing” requires the
plaintiff to “have (1) suffered an injury in fact, (2) that is fairly traceable to the
challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable
judicial decision”).

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It is clear from the face of Graham’s Complaint that he has not suffered an
actual or imminent injury-in-fact. Again, to satisfy the injury-in-fact requirement, the
plaintiff must plausibly allege “an invasion of a legally protected interest” that is both
“concrete and particularized” and “actual or imminent, not conjectural or hypothetical.”
Spokeo, Inc., at 1548 (quoting Lujan, 504 U.S. at 560). Graham has not established
that he has suffered an injury or will suffer an imminent injury if the Court does not
address his claims because the CARES Act did not grant an eligible individual a right
to an immediate economic impact payment. See 26 U.S.C. § 6428(f)(3)(A) (“The
Secretary shall, subject to the provisions of this title, refund or credit any overpayment
attributable to this section as rapidly as possible.”) (emphasis added). Instead, the
statute permits a recovery rebate to be made by advance refund (i.e., a “stimulus
check”), or a tax credit, or a combination of the two. 26 U.S.C. § 6428. Assuming
Graham is an eligible individual as defined under the law, his claim to an economic
impact payment would not be infringed upon unless and until he files his 2020 tax
return and is denied the payment by the IRS. Graham therefore has not alleged “an
invasion of a legally protected interest” that is actual or imminent. Spokeo, Inc., 136 S.
Ct. at 1548.
For these reasons, Graham’s Complaint is dismissed without prejudice pursuant
to 28 U.S.C. § 1915(e)(2)(B)(ii). See Schaller v. United States Soc. Sec. Admin., 844 F.
App’x 566, 573 (3d Cir. 2021) (“Dismissal for lack of standing reflects a lack of
jurisdiction, so dismissal ... should [be] without prejudice.”) (citing Thorne v. Pep Boys
Manny Moe & Jack Inc., 980 F.3d 879, 896 (3d Cir. 2020)). An appropriate Order
follows.

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BY THE COURT:

/s/ Gerald J. Pappert
GERALD J. PAPPERT, J.

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