Appeal from the United States District Court for the Eastern District of Wisconsin. No. 95 C 404 Robert W. Warren, Judge.
Before BAUER, ROVNER, and DIANE P. WOOD, Circuit Judges.
Suzanne Bartley filed this suit on behalf of herself and all other persons and entities who paid federal taxes between 1991 and 1993, *fn1 seeking a refund in excess of $2.4 trillion and an injunction barring what she characterizes as the continuing overcollection of federal taxes. Bartley alleges that Congress has levied taxes for purposes other than those expressly enumerated in the Constitution and in doing so has exceeded the authority to tax and spend granted by Article I sec. 8. *fn2 Accepting the magistrate judge's recommendation in part, the district court dismissed the suit, finding that Bartley had not satisfied the jurisdictional prerequisites to a suit for refund set out in 26 U.S.C. sec. 7422(a) and that the request for an injunction was contrary to the Anti-Injunction Act, 26 U.S.C. sec. 7421(a). Bartley v. United States, 1995 WL 835398, 77 A.F.T.R.2d 96-798 (E.D. Wis. Dec. 20, 1995).
There is a strong (and almost certainly successful) argument to be made, in view of United States v. Butler, 297 U.S. 1, 66, 56 S. Ct. 312, 319 (1936) ("the power of Congress to authorize expenditure of public moneys for public purposes is not limited by the direct grants of legislative power found in the Constitution"); see also Helvering v. Davis, 301 U.S. 619, 640-41, 57 S. Ct. 904, 908-09 (1937); Buckley v. Valeo, 424 U.S. 1, 90-91, 96 S. Ct. 612, 668-69 (1976); South Dakota v. Dole, 483 U.S. 203, 207, 107 S. Ct. 2793, 2796 (1987), that Bartley's suit is legally frivolous and beyond our subject matter jurisdiction for that reason. See Bell v. Hood, 327 U.S. 678, 682-83, 66 S. Ct. 773, 776 (1946); see also, e.g., Beauchamp v. Sullivan, 21 F.3d 789, 790 (7th Cir. 1994); Schreiber v. Lugar, 518 F.2d 1099, 1105 (7th Cir. 1975) (Stevens, J.). However, the government has not pursued that argument, and it is in any event apparent that we lack jurisdiction over the suit for other reasons as well.
Bartley's failure to exhaust her administrative remedies poses the initial obstacle to this suit. As a sovereign, of course, the United States cannot be sued without its consent, and when consent is given, the terms of that consent delimit the scope of the court's jurisdiction. See United States v. Dalm, 494 U.S. 596, 608, 110 S. Ct. 1361, 1368 (1990); United States v. Mottaz, 476 U.S. 834, 841, 106 S. Ct. 2224, 2229 (1986). Thus, "when Congress attaches conditions to legislation waiving the sovereign immunity of the United States, those conditions must be strictly observed, and exceptions thereto are not to be lightly implied." Block v. North Dakota, 461 U.S. 273, 287, 103 S. Ct. 1811, 1820 (1983) (collecting cases). The Internal Revenue Code authorizes suits for refund of taxes paid to the federal government, but expressly and without exception conditions the right to sue on the taxpayer having first requested a refund from the Secretary of the Treasury:
No suit prior to filing claim for refund.--No suit or proceeding shall be maintained in any court for the recovery of any 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, until a claim for refund or credit has been duly filed with the Secretary according to the provisions of law in that regard, and the regulations of the Secretary established in pursuance thereof. 26 U.S.C. sec. 7422(a).
Consistent with this provision, section 6532 of the Code further provides that no suit or proceeding for refund under section 7422(a) may be initiated until the Secretary renders a decision on the taxpayer's claim or until six months have passed since the claim was filed. 26 U.S.C. sec. 6532(a)(1); see 26 C.F.R. sec. 301.6402-2(a). In view of the plain language of these provisions, it is settled that unless the taxpayer has first filed a proper claim with the Internal Revenue Service, a court lacks subject matter jurisdiction over a suit for refund. United States v. Felt & Tarrant Mfg. Co., 283 U.S. 269, 272, 51 S. Ct. 376, 377 (1931); see also, e.g., Hefti v. IRS, 8 F.3d 1169, 1173 (7th Cir. 1993) (citing Goulding v. United States, 929 F.2d 329, 331 (7th Cir. 1991), cert. denied, 506 U.S. 865, 113 S. Ct. 188 (1992)); Martin v. United States, 833 F.2d 655, 658-59 (7th Cir. 1987). *fn3
Although on April 14, 1995, Ms. Bartley sent the Internal Revenue Service a letter requesting a refund on behalf of herself and the other members of the class she purports to represent, for several reasons it does not open the door to this suit. First, Bartley did not make her claim either on Form 1040X (the appropriate form for a refund of income taxes) or Form 843 (for other types of taxes). See 26 C.F.R. sec.sec. 301.6402-3(a)(2), 301.6402-2(c). Second, the letter did not comply with Treasury Regulation sec. 301.6402-2(d), which requires a taxpayer in pursuit of a refund to make a separate claim for each taxable period. Instead, the letter simply sought a refund of an uncertain amount for all three of the tax years in question. Third, the representations Bartley set out in her letter were not made under penalty of perjury, as the regulations also require. 26 C.F.R. sec. 301.6402-2(b)(1); see, e.g., Sloan v. Commissioner of Internal Revenue, 53 F.3d 799, 800 (7th Cir.), cert. denied, 116 S. Ct. 252 (1995). Not surprisingly, the IRS itself did not treat Bartley's letter as a proper claim, but responded by letter enclosing the appropriate forms for filing a claim. So far as the record before us reveals, Bartley never completed those forms. Instead, just three days after she mailed her letter to the IRS, she filed the instant suit, in contravention of section 6532. Bartley therefore did not comply with the jurisdictional prerequisites spelled out in the Internal Revenue Code, and having failed to do so could not bring suit in her own right, let alone on behalf of a class of millions of other taxpayers (who, so far as the record discloses, have not complied with the statutory requirements either). See Oatman v. Department of Treasury þ IRS, 34 F.3d 787, 789 (9th Cir. 1994); Heisler v. United States, 463 F.2d 375 (9th Cir. 1972) (per curiam), cert. denied, 410 U.S. 927, 93 S. Ct. 1358 (1973); Saunooke v. United States, 8 Cl. Ct. 327, 330 (1985); Agron v. Illinois Bell Tel. Co., 325 F. Supp. 487, 488 (N.D. Ill. 1970) (Marovitz, J.), appeal dismissed as moot, 449 F.2d 906 (7th Cir. 1971), cert. denied, 405 U.S. 954, 92 S. Ct. 1171 (1972).
Bartley contends that it is inappropriate to require that she adhere to the formalities of the Tax Code when it is quite clear that the Internal Revenue Service will deny her claim in any event. But this kind of argument was long ago rejected by the Supreme Court in Felt & Tarrant Mfg. Co. There the Court of Claims had permitted a taxpayer to recover certain taxes which it claimed had been collected illegally. Before the Supreme Court, the government conceded that the taxpayer was owed a refund based on a deduction that had been improperly disallowed, and its sole objection to the judgment was that the taxpayer had not filed a claim for refund pursuing that deduction. See 283 U.S. at 270, 51 S. Ct. at 377. The Court of Claims had deemed it unnecessary for the taxpayer to have filed such a claim, reasoning that the Treasury had been consistently denying the very type of deduction that the taxpayer sought and thus any claim for that deduction would have been futile. See id. at 272, 51 S. Ct. at 377. The Supreme Court disagreed, holding that it was necessary for the taxpayer to have filed a claim as required by the statute notwithstanding the purported futility of the claim:
The necessity for filing a claim such as the statute requires is not dispensed with because the claim may be rejected. It is the rejection which makes the suit necessary. An anticipated rejection of the claim, which the statute contemplates, is not a ground for suspending its operation. Even though formal, the condition upon which the consent to suit is given is defined by the words of the statute, and "they mark the conditions of the claimant's right." Rock Island R. R. Co. v. United States, 254 U.S. 141, 143, 41 S. Ct. 55, 56, 65 L.Ed. 188. Compliance may be dispensed with by waiver, as an administrative act, Tucker v. Alexander, supra [275 U.S. 228, 48 S. Ct. 45, 72 L. Ed. 253]; but it is not within the judicial province to read out of the statute the requirement of its words, Rand v. United States, 249 U.S. 503, 510, 39 S. Ct. 359, 63 L. Ed. 731. 283 U.S. at 273, 51 S. Ct. at 378.
The Court therefore reversed the judgment entered in favor of the taxpayer below, notwithstanding its undisputed entitlement to a refund. Felt & Tarrant squarely addresses Bartley's argument and makes plain that we do not have the authority to excuse her failure to make a claim as required by section 7422(a), notwithstanding our certainty that the IRS ultimately will reject her claim. See also Wiltshire v. United States, 1983 WL 1703, *1 (E.D. Tex. Oct. 31, 1983). *fn4
Subject to the statute of limitations (see 26 U.S.C. sec. 6511(a)), this omission is presumably one that Bartley could remedy (at least insofar as she seeks relief on her own behalf) by filing an appropriate claim, leaving her free to bring suit again at a later date; and in view of that possibility we think it important to note that we also lack jurisdiction over this suit for another, more fundamental reason: Bartley lacks standing to bring it. Article III requires that a plaintiff have a direct and concrete interest in the outcome of a suit, not merely a general interest shared equally by other members of the public. E.g., Raines v. Byrd, 1997 WL 348141, *5 (U.S. June 26, 1997); United States v. Hays, 515 U.S. 737, 115 S. Ct. 2431, 2435 (1995); Lujan v. Defenders of Wildlife, 504 U.S. 555, 573-754, 112 S. Ct. 2130, 2143 (1992); Valley Forge Christian College v. Americans United for Separation of Church ...