United States v. Weiss

516 F.Supp.3d 443

UNITED STATES of America, Plaintiff,

v.Charles J. WEISS, Defendant.

CIVIL ACTION NO. 19-502

United States District Court, E.D. Pennsylvania.

Signed February 1, 2021

Filed February 2, 2021

Nishant Kumar, U.S. Dept. of Justice - Tax Division, Washington, DC, for Plaintiff.

James R. Malone, Jr., Post & Schell, P.C., Philadelphia, PA, for Defendant.

OPINION

Slomsky, District Judge

I. INTRODUCTION

Before the Court is the Government's Motion for Summary Judgment. (Doc. No. 45.) Seeking to collect Defendant Charles J. Weiss' unpaid income taxes plus interest for the years 1986 to 1991, the Government avers it is entitled to summary judgment in light of Defendant's sworn federal income tax returns and his stipulations to the amount of taxes owed. Defendant does not contest the total amount of his income tax liabilities for the years 1986 to 1991.

For the reasons discussed infra, and viewing the facts in the light most favorable to Defendant as the nonmovant, the Government's Motion for Summary Judgment (Doc. No. 45) will be granted.

II. BACKGROUND

This case has a long history of litigation, which is summarized as follows:

Defendant Charles Weiss did not pay his income taxes for the years 1986 through 1991, and under 26 U.S.C. § 6502(a)(1), the Government had ten years to collect the taxes from the time it made an assessment. It did so in 1994 and over the years the 10-year period was tolled due to Weiss filing for bankruptcy on several occasions. Eventually, Weiss filed for a hearing on the assessment, which is also referred to as a collection due process ("CDP") hearing. The parties agreed that 129 or 130 days remained on the statute of limitations from the time that Weiss mailed in the form for this hearing. The hearing was held, and his claims were rejected. This decision was upheld by the United States Tax Court in August 2016. On November 23, 2016, Weiss appealed the decision of the Tax Court to the United States Court of Appeals for the District of Columbia Circuit. On May 22, 2018, the D.C. Circuit affirmed the decision of the Tax Court. On August 23, 2018, the D.C. Circuit issued its mandate. On October 24, 2018, Weiss filed a petition for a writ of certiorari with the United States Supreme Court, seeking review of the D.C. Circuit's ruling. On December 3, 2018, the petition for a writ of certiorari was denied. On February 5, 2019—64 days after the Supreme Court denied the petition for a writ of certiorari—the Government brought the present action against Weiss to reduce to judgment his unpaid assessments plus statutory additions ....

(Doc. No. 37 at 2.)

As noted above, 26 U.S.C. § 6502(a) allows the Government to begin a proceeding to collect Defendant's unpaid income taxes within 10 years from the date the Government assessed Defendant's income tax liabilities. The statute reads as follows:

Where the assessment of any tax imposed by this title has been made within the period of limitation¹ properly applicable thereto, such tax may be collected by levy or by a proceeding in court, but only if the levy is made or the proceeding begun—

(1) within 10 years after the assessment of the tax, ...

If a timely proceeding in court for the collection of a tax is commenced, the period during which such tax may be collected by levy shall be extended and shall not expire until the liability for the tax (or a judgment against the taxpayer arising from such liability) is satisfied or becomes unenforceable.

§ 6502(a).

In the Complaint timely filed on February 5, 2019, the Government pled that "[i]n accordance with Weiss' sworn federal income tax returns," the income tax assessments show Defendant "is indebted to the United States in the amount of $773,899.84 as of February 11, 2019, plus statutory additions to tax that will continue to accrue on the unpaid balance until paid in full." (Doc. No. 1 ¶ 5, 9.) On May 24, 2019, Defendant filed an Answer. (Doc. No. 7.) On September 18, 2019, the parties filed a Joint Stipulation. (Doc. No. 14.) Among other things, the parties stipulated to the assessments made on Defendant's income tax returns for the years 1986 to 1991. (See id. ¶¶ 12-35.) The parties agreed that Defendant's income tax liabilities, exclusive of interest, are as follows: (1) $47,185 for 1986; (2) $47,856 for 1987; (3) $36,954 for 1988; (4) $50,460 for 1989; (5) $55,224 for 1990; and (6) $61,523 for 1991. (See id. ¶¶ 13, 17, 21, 25, 29, 33.) Moreover, the Government attached to the Stipulation copies of the IRS account transcript for each tax year as further proof of each assessments' accuracy. (See id. at 13-45.)

On November 13, 2020, the parties filed a second Joint Stipulation regarding Defendant's tax liabilities. (Doc. No. 44.) The parties stipulated that as of October 6, 2020, Defendant's federal income tax liabilities, inclusive of interest, are as follows: (1) $145,275 for 1986; (2) $132,672 for 1987; (3) $128,907 for 1988; (4) $131,246 for 1989; (5) $110,129 for 1990; and (6) $184,359 for 1991. (See id. ¶ 1.) They noted that Defendant "does not and will not challenge the amounts ... though he may continue to dispute his obligation to pay such amounts."² (Id. ¶ 2.)

On December 15, 2020, the Government filed the instant Motion for Summary Judgment. (Doc. No. 45.) In the Motion, it argues that there are no genuine issues of material fact in this case regarding "the federal income tax assessments made against the defendant," and therefore it is entitled to judgment on those assessments—plus interest—which as of October 6, 2020 totals to $832,588. (Id. at 1.) "[I]n order to avoid summary judgment," the Government explains that Defendant "must come forward with credible evidence showing that a genuine issue of material fact remains as to the income tax assessments made against him, or that the United States is not entitled to a judgment as a matter of law." (Doc. No. 45-1 at 3.) It argues that Defendant cannot do so because "the income tax assessments made against him were based on his own sworn federal income tax returns," and he "stipulat[ed] to the current amount of the liabilities." (Id. )

On January 12, 2021, Defendant filed a Response in Opposition to the Government's Motion. (Doc. No. 48.) In his Response, Defendant does not refute the total amount of income tax liabilities owed to the Government "though he may continue to dispute his obligation to pay such amounts." (Doc. No. 48-2 at 3 ¶ 4.)

On January 22, 2021, the Government filed a Reply. (Doc. No. 49.) "In responding to the Government's motion," it notes that Defendant "does not dispute the dollar amounts of his tax liabilities .... He concedes there are no material disputed issues of fact." (Id. at 1.) "The parties stipulated to those dollar amounts, ... and — as the parties agreed would happen because Weiss would not enter a consent judgment — the Government then moved for summary judgment." (Id. )

III. STANDARD OF REVIEW

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). In reaching this decision, the court must determine whether "the pleadings, depositions, answers to interrogatories, admissions, and affidavits show there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." Favata v. Seidel, 511 F. App'x 155, 158 (3d Cir. 2013) (quoting Azur v. Chase Bank, USA, Nat'l Ass'n, 601 F.3d 212, 216 (3d Cir. 2010) ).

A disputed issue is "genuine" only if there is a sufficient evidentiary basis on which a reasonable jury could find for the non-moving party. See Kaucher v. County of Bucks, 455 F.3d 418, 423 (3d Cir. 2006) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). For a fact to be considered "material," it "must have the potential to alter the outcome of the case."

Favata, 511 F. App'x at 158. If there is no factual issue, and if only one reasonable conclusion could arise from the record regarding the potential outcome under the governing law, summary judgment must be awarded in favor of the moving party. See Anderson, 477 U.S. at 250, 106 S.Ct. 2505.

IV. ANALYSIS

Upon reviewing the pleadings, motions, and joint stipulations, it is evident there is no genuine dispute of material fact present in this case. Therefore, under governing law, the Government is entitled to a judgment against Defendant for the unpaid income taxes plus interest for the years 1986 to 1991.

A. Summary Judgment Will Be Granted Because There Is No Genuine Dispute of Material Fact on the Tax Liabilities of Defendant

No genuine issues of material fact exist in this case because the parties have twice stipulated to all material facts. "[F]actual stipulations are ‘formal concessions ... that have the effect of withdrawing a fact from issue and dispensing wholly with the need for proof of the fact." Christian Legal Soc. Ch. of the U.C., Hastings Coll. of the Law v. Martinez, 561 U.S. 661, 677-78, 130 S.Ct. 2971, 177 L.Ed.2d 838 (2010) (alteration in original) (citation omitted). In other words, a joint stipulation to facts "admits that there is no dispute as to the facts[.]" 83 C.J.S. Stipulations § 86 (footnote omitted).

Here, the parties filed joint Stipulations on September 18, 2019 and November 13, 2020. (Doc. Nos. 14, 44.) In the first Stipulation, the parties stipulated to the Government's assessments of Defendant's unpaid income tax liabilities, exclusive of interest, for the years 1986 to 1991. (See Doc. No. 14 ¶¶ 13, 17, 21, 25, 29, 33.) Each years' assessment is as follows: (1) $47,185 for 1986; (2) $47,856 for 1987; (3) $36,954 for 1988; (4) $50,460 for 1989; (5) $55,224 for 1990; and (6) $61,523 for 1991. (See id. ) The Government also attached to the Stipulation copies of the IRS account transcript for each tax year as further proof of each assessments' accuracy. (See id. at 13-45.)

In the second Stipulation, the parties agreed...