McNeil v. Harvey

ROBERT A. MCNEIL, et al., Plaintiffs, v. G. MICHAEL HARVEY, et al., Defendants.

Civil Action No.: 17-1720 (RC)

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

September 26, 2018

Re Document No.: 5, 16, 18, 20, 21, 23, 26, 31, 37

MEMORANDUM OPINION

GRANTING DEFENDANTS' MOTION TO DISMISS; DENYING AS MOOT OTHER PENDING MOTIONS

I. INTRODUCTION

Pro se plaintiffs in this case seek declaratory judgments against three U.S. District Court judges and one U.S. magistrate judge for alleged violations of their First and Fifth Amendment rights. Plaintiffs' interactions with Defendants stem from their refusal to pay income taxes, which has resulted in Plaintiffs' pursuit by the Internal Revenue Service ("IRS"). Plaintiffs allege that the IRS has been pretending to file substitute income tax returns on their behalf and that through this "record falsification program" the IRS has subjected them to harsh penalties such as monetary fines and incarceration. In response, Plaintiffs filed numerous lawsuits against the Department of Justice ("DOJ") and the IRS, and then against three of the judges who presided over such cases. Defendants in this case are the U.S District Court and U.S. magistrate judges who presided over ten of the underlying cases. The judges dismissed or recommended dismissal of the underlying cases as barred by the Anti-Injunction Act, and in the case against the judges, for lack of standing as well. Plaintiffs now seek a declaratory judgment against Defendants acknowledging that Defendants failed to adjudicate their cases on their merits, as Plaintiffs believe they were constitutionally required to do.

Defendants have moved to dismiss this case under Rules 12(b)(1) and 12(b)(6) on five grounds, arguing that (1) Plaintiffs cannot establish redressability, and therefore lack Article III standing; (2) the Court lacks jurisdiction to hear a Bivens action seeking equitable relief because Bivens does not authorize suits seeking equitable relief; (3) the Declaratory Judgment Act excludes matters involving taxation; (4) the proper avenue for relief of Plaintiffs' alleged grievances is through appeal; and (5) Plaintiffs have failed to state a claim upon which relief can be granted because the court is not a reviewing court and cannot provide the relief Plaintiffs seek. Because Plaintiffs have failed to establish that they have Article III standing, the Court grants Defendants' motion to dismiss for lack of subject matter jurisdiction. Further, because the Court dismisses the case for lack of subject matter jurisdiction, the remaining motions pending in this case are denied as moot.

II. FACTUAL BACKGROUND

This case stems from a series of suits filed by Plaintiffs against the IRS, DOJ, and other federal officials.¹ Plaintiffs allege that IRS employees used falsified digital records to pretend to prepare substitute income tax returns on their behalf. Am. Compl. ¶ 3, ECF No. 11. Plaintiffs claim that both the IRS and the DOJ use the IRS's "record falsification program" to enforceincome tax law on nontaxpayers like them. Id. ¶ 1. They believe that due to this system, their property is being stolen and they are being wrongly incarcerated. Id. Plaintiffs claim that, in pursuing the underlying cases, the core factual contention they sought to have confirmed was whether the IRS "never actually prepares substitutes for [income tax] returns, but rather inputs computer codes to make it appear as though a substitute [income tax] return has been filed." Id. ¶ 2 (quoting Gov't Mot. Consolidate Cases, Stanley v. Lynch, No. 17-cv-22, ECF No. 11 (Mar. 8, 2017)). Citing Long v. Rasmussen, Plaintiffs contend that

[t]he revenue laws are a code or system in regulation of tax assessment and collection. They relate to taxpayers, and not to nontaxpayers. The latter are without their scope. No procedure is prescribed for nontaxpayers, and no attempt is made to annul any of their rights and remedies in due course of the law. With them Congress does not assume to deal, and they are neither of the subject nor of the object of the revenue laws.

Id. ¶ 2, n.1. In essence, Plaintiffs' underlying cases revolved around a belief that the Internal Revenue Code does not apply to them. These cases were dismissed for lack of standing and failure to comply with the Anti-Injunction Act. See id. ¶ 3.

Plaintiffs contend that no court has determined whether the Plaintiffs' core allegation, raised in the underlying cases, is true. Id. ¶ 3. Instead, they believe that the defendant judges who presided over their cases invariably fabricated and attributed to them forms of relief they did not seek. Id. They believe that Defendants also fraudulently drew each case within the prohibitions of the Anti-Injunction Act to avoid making the factual determination needed to adjudicate their cases. Id. In short, Plaintiffs allege that Defendants, acting as federal judges, but whom Plaintiffs have sued in their personal capacities only, participated in an IRS and DOJ scheme by conspiring to dismiss their cases in a fraudulent manner in order to avoid adjudicating their cases on their actual merits. Id.

Plaintiffs now seek a six-part declaratory judgment answering the following questions in regard to each of the ten cases dismissed:

1) Did the Plaintiff[s] complain, as their core fact contention, that IRS never prepares substitute income tax returns on any date shown in IRS' falsified Individual Master File records concerning the targeted nontaxpayer?

2) Did the attorney appointed to adjudicate that core fact controversy do so?

3) Did the attorney falsify the case record by attributing to litigants relief they did NOT seek, i.e.[], that Plaintiffs supposedly sought to enjoin IRS from preparing substitute income tax returns, then dismiss the case (or recommend dismissal) on the basis of that fabrication, thus drawing each case, by fraud, within the ambit of Anti-Injunction Act prohibitions?

4) Does the uniform falsification by attorneys, of the federal record in TEN separate fully-paid cases, provide strong circumstantial evidence victims' cases, as filed, are meritorious?

5) Does the uniform falsification by attorneys, of the record in TEN Class cases, violate each Plaintiff[]'[s] right to adequate, effective and meaningful access to courts and to due process of law, and constitute, as well, obstruction of the administration of justice?

6) When attorneys uniformly falsify the record of TEN cases to avoid adjudicating their merits, do the dismissals have any precedential value or preclusive effect in regard to the unadjudicated fact controversy raised by Class victims?

Id. ¶ 4.

Plaintiffs have taken pains to emphasize that they are not challenging any actions taken by the IRS, DOJ, or any executive branch personnel to enforce the income tax. Id. ¶¶ 5-6. Furthermore, they claim that they do not seek a declaratory judgment assessing any income tax liability. Id. Instead, Plaintiffs believe that if the Court were to grant their six-part declaratory judgment against Defendants, "such judgment would allow Class victims to re-file their cases and secure resolution of the core fact controversy they have so meticulously described." Id. ¶ 7.

Defendants have moved to dismiss Plaintiffs' Amended Complaint for lack of subject matter jurisdiction and failure to state a claim. See Defs.' Mot. Dismiss ("Defs.' Mot."), ECF No. 23. Their motion is now ripe for decision.

III. LEGAL STANDARD

When evaluating a motion to dismiss, a court must "treat the complaint's factual allegations as true and must grant plaintiff the benefit of all inferences that can be derived from the facts alleged." Grant v. Ent. Cruises, Inc., 282 F. Supp. 3d 114, 116 (D.D.C. 2017) (quoting Sparrow v. United Air Lines, Inc., 216 F.3d 1111, 1113 (D.C. Cir. 2000) (internal quotation marks and citation omitted)); see also Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). This standard governs the consideration of motions filed under both Rule 12(b)(1) and 12(b)(6). See Scheuer v. Rhodes, 416 U.S. 232, 236 (1974), abrogated on other grounds by Harlow v. Fitzgerald, 457 U.S. 800 (1982) ("[I]n passing on a motion to dismiss, whether on the ground of lack of jurisdiction over the subject matter or for failure to state a cause of action, the allegations of the complaint should be construed favorably to the pleader."). The Court need not accept as true, however, "a legal conclusion couched as a factual allegation," nor an inference unsupported by the facts set forth in the complaint. Trudeau v. Fed. Trade Comm'n, 456 F.3d 178, 193 (D.C. Cir. 2006) (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986)).

To survive a motion to dismiss under Rule 12(b)(1), plaintiffs bear the burden of proving that the court has subject-matter jurisdiction to hear their claims. See DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 & n.3 (2006); Arpaio v. Obama, 797 F.3d 11, 19 (D.C. Cir. 2015). A court has an "affirmative obligation to ensure that it is acting within the scope of its jurisdictional authority." Grand Lodge of Fraternal Order of Police v. Ashcroft, 185 F. Supp. 2d 9, 13 (D.D.C. 2001). For this reason, "'Plaintiff[s'] factual allegations in the complaint . . . will bear closerscrutiny in resolving a 12(b)(1) motion' than in resolving a 12(b)(6) motion for failure to state a claim." Wright v. Foreign Serv. Grievance Bd., 503 F. Supp. 2d 163, 170 (D.D.C. 2007).

IV. ANALYSIS

Defendants have moved to dismiss on five grounds. Defendants first argue that Plaintiffs' suit should be dismissed because Bivens does not authorize suits for equitable relief. Defs.' Mot. at 4. Defendants believe that this remedial limitation deprives the court of subject-matter jurisdiction over this case. Id. Second, Defendants argue that Plaintiffs lack standing to bring this case for declaratory relief against Defendants in their personal capacities because Defendants in their personal capacities have no ability to redress Plaintiffs' injuries. Id. at 5. Third, Defendants argue...