United States of America v. Bogart et al
Filing
53
REPORT AND RECOMMENDATION: Magistrate Judge Brown RECOMMENDS that the Motion to Dismiss 35 and the Motion for Consolidation and Transfer 48 be Denied. Signed by Magistrate Judge Joe Brown on 9/28/12. (xc:Pro se party by regular and certified mail.)(DOCKET TEXT SUMMARY ONLY-ATTORNEYS MUST OPEN THE PDF AND READ THE ORDER.)(dt)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF TENNESSEE
NASHVILLE DIVISION
UNITED STATES OF AMERICA,
)
)
)
)
)
)
)
)
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Plaintiff
v.
DUSTIN B. BOGART, et al.,
Defendants
TO:
No. 3:12-0179
Judge Sharp/Brown
THE HONORABLE KEVIN H. SHARP
REPORT AND RECOMMENDATION
Presently pending in this case is a motion to dismiss by
Defendants Dustin and Marcy Bogart (Defendants) (Docket Entry 35),
and a motion to consolidate this case with a similar Pennsylvania
case involving the same parties also filed by Dustin and Marcy
Bogart (Docket Entry 48).
For the reasons stated below the
Magistrate Judge recommends that both of these motions be DENIED.
BACKGROUND
The United States of America’s (Plaintiff) complaint
seeks to reduce the judgment tax assessments against Dustin Bogart
for income tax, taxes, penalties, and interest for tax years 2000
through 2003; obtain a declaration regarding the validity of
federal tax liens and nominee liens against the property and rights
to property owned by Dustin Bogart, and to foreclose such liens
against
real
property
located
at
State
Route
147,
Stewart,
Tennessee; and to sell the real property and apply the proceeds to
satisfy the federal tax liens.
Marcy Bogart is named as a Defendant because the United
States believes she may claim an interest in real property located
within the Middle District of Tennessee.
Likewise, the Defendant
Southern Country Ranch (SCR) is named as a Defendant because the
Plaintiff believes they claim an interest in the real property
located within the Middle District of Tennessee.
Under jurisdiction and venue the Plaintiff alleges that
the action is at the request and with the authorization of the
Chief Counsel for the Internal Revenue Service, the delegate of the
Secretary of Treasury, and at the direction of the Attorney General
of the United States or his delegate, pursuant to 26 U.S.C. §§
7401, 7403.
The
Defendants’
motion
to
dismiss
allege
that
the
Plaintiff has failed to offer any proof that this action has been
approved by the required governmental officials. The Plaintiff has
responded (Docket Entry 47), arguing that absent specific evidence
that the suit has not been authorized, that the Plaintiff’s
statement of authorization in the complaint is sufficient, citing
United
States
v.
McCallum,
970
F.2d
66,
69
(5th
Cir.
1992).
Additionally, with their response the Plaintiff filed an affidavit
of Mr. Lambert (Docket Entry 47-1), certifying that his file
contains
a
February
10,
2012,
letter
(Docket
Entry
47-2)
transmitting the complaint in the case to the associate area
2
counsel of the Internal Revenue Service with reference to approval
by the delegate of the Attorney General.
Docket Entry 47-2 states that the suit has been filed at
the direction of the Attorney General, with the authorization of
and at the request of the Chief Counsel.
The motion to consolidate (Docket Entry 48) is based on
the fact that the Defendants have resided in Pennsylvania since
March 2010 when Mr. Bogart’s father passed away.
The Defendants
further state that it would be a serious inconvenience, given his
78-year-old handicapped mother, for them to have to defend this
case in Tennessee.
They also point out that they are involved in
a similar suit in Pennsylvania.
The Magistrate Judge has reviewed
the Pennsylvania
case, United States of America v. Dustin B.
Bogart,
Bogart,
Marcy
A.
and
Southern
District of Pennsylvania Docket Number
Country
Ranch,
Middle
4-12-347.
In the Pennsylvania suit the Plaintiff seeks to obtain a
declaration regarding the validity of federal tax liens and nominee
liens against the property and rights to the property owned by
Dustin Bogart, and to foreclose such liens against real property
located on Brush Valley Road in Sunbury, Pennsylvania, and to
follow this real property subject to the federal tax liens and
nominee liens. That suit also alleges the Bogarts reside on State
Route 147, Stewart, Tennessee. It further alleges that there is
property of SCR that is located in Pennsylvania.
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The Bogarts filed a motion in Pennsylvania to consolidate
that case with the case in this court. The District Judge in the
Pennsylvania case denied the motion to consolidate the cases in
Pennsylvania (case 4-12-347 Docket Entry 20). He held that there
was real property alleged to be in Tennessee, and additional real
property alleged to be in Pennsylvania and the cases should remain
where their was real property.
At the request of the Magistrate Judge (Docket Entry 31),
the Plaintiff filed a statement on the consolidation issue (Docket
Entry 41).
In their response, the Plaintiff pointed out that in
their view the Defendants claimed Tennessee as their permanent
residence
Tennessee.
and
that
venue
was
within
the
Middle
District
of
They argue that venue under 26 U.S.C. § 7403 is only
proper in the district in which the property is located.
They
argue that consolidation would be appropriate only if the action
here could have originally been brought in Pennsylvania, citing 28
U.S.C. § 1404(a).
At the initial case management conference in this matter,
held on September 24, 2012, Mr. Jerry Spears participated and
advised that he was the trustee for SCR.
service by mail in this matter.
He agreed to accept
The Plaintiff advised that they
would promptly serve him at his Stewart, Tennessee address. He was
advised by the Magistrate Judge that he would not be able to
represent an artificial entity, such as SCR, and that SCR would
have to have an attorney represent it.
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LEGAL DISCUSSION
The Magistrate Judge believes that the United States has
alleged a sufficient basis for this lawsuit to resist a bare motion
to
dismiss.
The
complaint
itself
alleges
the
appropriate
authorities have approved the litigation, and although the actual
letters of authorization was not been filed, the Plaintiff’s trial
attorney has provided, under penalty of perjury, a statement that
he has been assigned litigation responsibilities for the present
civil action and has presents evidence of proper authorization by
Treasury and justice.
At this early stage of the litigation the Magistrate
Judge believes that the complaint and the supporting documents are
sufficient to withstand this motion to dismiss.
specific
proof
that
this
litigation
was
not
Absent some
authorized,
the
Magistrate Judge believes that the motion to dismiss is without
merit.
The motion to consolidate the cases in Pennsylvania is a
closer question and certainly has some appeal at the practical
level.
While jurisdiction cannot be waived by the parties, venue
can be waived. In this case, the Plaintiff has chosen Pennsylvania
and Tennessee for the filing of these cases because the seek to
foreclose on real property in both states.
Although the complaint
alleges that the Bogarts reside in Tennessee, it does appear from
the
pleadings
that
at
the
present
time
they
are
living
in
Pennsylvania and will remain there for the foreseeable future.
5
They contend that they do not, at the present time, have a
residence in Tennessee and they disclaim any present connection
with SCR.
They
do
make
an
argument
that
since
they
are
in
Pennsylvania it would be more convenient for them to litigate the
matter there.
The counsel for the Plaintiff resides in Washington
and it would make little or no difference whether counsel had to
travel
to
Pennsylvania
or
Tennessee,
from
the
Plaintiff’s
standpoint.
Were that the extent of the case, the Magistrate Judge
might well recommend that venue in this case be transferred to the
Middle District of Pennsylvania.
However, as a result of the case
management conference, Mr. Spears has appeared and advised that he
is the trustee for SCR and that he resides in Stewart, Tennessee.
SCR, which according to the complaint, owns property both in
Tennessee and Pennsylvania, has not indicated that it desires to
waive venue. Absent a waiver of venue by SCR, the Magistrate Judge
believes that this motion to consolidate must be DENIED without
prejudice at this stage of the proceedings.
See Union Planters
Bank, N.A. v. EMC Mortgage Corporation, 67 F.2d 915 (W.D. Tenn.
1999).1
1
Should all Defendants and the Plaintiff agree, the Magistrate Judge
believes that this case might well be properly transferred to the Middle
District of Tennessee. However, at this point there is no agreement by
all Defendants.
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RECOMMENDATION
For
the
reasons
stated
above,
the
Magistrate
Judge
recommends that the motion to dismiss (Docket Entry 35) and the
motion for consolidation and transfer (Docket Entry 48) be DENIED.
Under Rule 72(b) of the Federal Rules of Civil Procedure,
any
party
has
14
days
from
receipt
of
this
Report
and
Recommendation in which to file any written objections to this
Recommendation with the District Court.
Any party opposing said
objections shall have 14 days from receipt of any objections filed
in this Report in which to file any responses to said objections.
Failure to file specific objections within 14 days of receipt of
this Report and Recommendation can constitute a waiver of further
appeal of this Recommendation.
Thomas v. Arn, 474 U.S. 140 106 S.
Ct. 466, 88 L.Ed.2d 435 (1985), Reh’g denied, 474 U.S. 1111 (1986).
ENTER this 28th day of September, 2012.
/s/ Joe B. Brown
JOE B. BROWN
United States Magistrate Judge
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