United States District Court, C.D. Illinois, Springfield Division
December 21, 2005.
DENNY PATRIDGE and JUDY PATRIDGE, Plaintiffs,
UNITED STATES INTERNAL REVENUE SERVICE and REVENUE OFFICER CURTIS MEGYESI and DEBRA DUFEK, Defendants.
The opinion of the court was delivered by: JEANNE SCOTT, District Judge
This matter is before the Court on the United States' Motion to
Dismiss (d/e 8). Plaintiffs Denny and Judy Patridge filed their
Petition for Redetermination, Judicial Review, Reversal and
Quashing Concerning Collection Action(s) under Section 6330 (d/e
1) (Petition) against the United States Internal Revenue Service
(IRS), and Revenue Officers Curtis Megyesi and Debra Dufek on
September 23, 2005, seeking review of an Internal Revenue Service
Notice of Determination issued on August 24, 2005. The IRS asks
the Court to dismiss the action under Fed.R.Civ.P. 12(b)(1) for lack of subject matter jurisdiction. For the reasons
set forth below, the Motion to Dismiss is allowed, and the
Petition is dismissed for lack of subject matter jurisdiction.
According to the Petition, Plaintiffs received a Final Notice
of Intent to Levy on November 23, 2000. This Notice informed
Plaintiffs that they had a right to challenge the collection
activity under 26 U.S.C. § 6330. Plaintiffs made a request for a
due process hearing on November 28, 2000. The hearing was held
August 17, 2005, before Defendant Megyesi. At the hearing,
Plaintiffs argued that a Notice of Deficiencies dated January 27,
2000, for tax years 1996 and 1997 constituted an impermissible
"whipsaw tax" and a double tax. On August 24, 2005, Defendant
Dufek issued the Notice of Determination Concerning Collection
Action(s) under Section 6320 and/or 6330 at issue here. The
Petition asserts that the Notice of Determination is erroneous in
many ways. The IRS moves to dismiss, arguing that this Court
lacks jurisdiction because the United States has not waived its
sovereign immunity with respect to Plaintiffs' claims.
The standard of review for a Rule 12(b)(1) motion to dismiss
for lack of subject matter jurisdiction depends on the purpose of the
motion. See United Phosphorus, Ltd. v. Angus Chem. Co.,
322 F.3d 942, 946 (7th Cir. 2003) (en banc).
If subject matter jurisdiction is not evident on the
face of the complaint, the motion to dismiss pursuant
to Rule 12(b)(1) would be analyzed as any other
motion to dismiss, by assuming for purposes of the
motion that the allegations in the complaint are
true. However, as here, if the complaint is formally
sufficient but the contention is that there is in
fact no subject matter jurisdiction, the movant may
use affidavits and other material to support the
motion. The burden of proof on a 12(b)(1) issue is on
the party asserting jurisdiction.
"The United States government may be sued only where Congress
has waived its sovereign immunity and the existence of such
waiver is a prerequisite for jurisdiction." LaBonte v. United
States, 233 F.3d 1049, 1052 (7th Cir. 2000) (internal
quotations and citations omitted). The IRS is an agency of the
United States; therefore, this Court's jurisdiction is contingent
on whether the United States has waived its sovereign immunity.
To bring an action against the United States in federal court,
Plaintiffs must identify a statute conferring subject matter
jurisdiction and a federal law waiving the sovereign immunity of
the United States. Clark v. United States, 326 F.3d 911, 912
(7th Cir. 2003) (per curiam). As previously noted, Plaintiffs bear the burden of proof on the issue of
As an initial matter, the IRS submits that the claims against
Defendants Megyesi and Dufek are official capacity claims and, as
such, are in essence claims against the United States. Plaintiffs
do not respond to this argument. It is clear from the Petition
that Megyesi and Dufek are being sued in their official
capacities. Thus, the claims against these two Defendants are
claims against the IRS and subject to the sovereign immunity
analysis as well. See Kentucky v. Graham, 473 U.S. 159, 165
The Petition alleges that this Court has jurisdiction pursuant
to 28 U.S.C. §§ 1331, 1340, & 1361 and 26 U.S.C. §§ 7421(a) &
6330(d)(1)(B). Of these sections, only 26 U.S.C. § 6330(d)(1)(B)
addresses a waiver of sovereign immunity. Under
26 U.S.C. § 6330(d)(1):
The person may, within 30 days of a determination
under this section, appeal such determination
(A) to the Tax Court (and the Tax Court shall have
jurisdiction with respect to such matter); or
(B) if the Tax Court does not have jurisdiction of
the underlying tax liability, to a district court of
the United States.
If a court determines that the appeal was to an
incorrect court, a person shall have 30 days after
the court determination to file such appeal with the correct court.
Plaintiffs assert that their Petition falls under §
The IRS has attached exhibits to its Memorandum in Support of
Its Motion to Dismiss (d/e 9), including: (1) Notice of
Determination Concerning Collection Action(s) under Section 6320
and/or 6330, dated August 24, 2005, with Attachment; (2) Final
Notice of Intent to Levy, dated November 23, 2000; and (3) Notice
of Deficiency, dated January 27, 2000. The Court notes that the
weight of Seventh Circuit authority allows a court considering a
Rule 12(b) or (c) motion to rely on a document that had "merely
been referred to in the complaint, provided it was a concededly
authentic document central to the plaintiff's claim" without
converting the motion to one for summary judgment. Tierney v.
Vahle, 304 F.3d 734, 738 (7th Cir. 2002) (collecting cases).
In the present case, Plaintiffs do not challenge the authenticity
of these three exhibits or dispute their applicability.
Therefore, the Court will consider these documents in analyzing
the Motion to Dismiss.
Plaintiffs assert: (1) § 6330 is a waiver of sovereign immunity
of the United States to either the Tax Court or the United States
District Court, with no distinction based on the type of tax at
issue and (2) the taxes at issue are outside the jurisdiction of the Tax Court. Plaintiffs
cite no cases to support their belief that § 6330's waiver of
sovereign immunity encompasses both the Tax Court and the
District Court. By the express terms of § 6330(d)(1)(B), in order
for this Court to have jurisdiction, the Tax Court must not have
jurisdiction of the underlying tax liability. "Waivers of the
Government's sovereign immunity, to be effective, must be
unequivocally expressed." United States v. Nordic Village Inc.,
503 U.S. 30, 33 (1992) (internal quotations and citations
omitted). Furthermore, the Supreme Court has recognized "the
traditional principle that the Government's consent to be sued
must be construed strictly in favor of the sovereign, and not
enlarge[d] . . . beyond what the language requires." Id. at 34
(internal quotations and citations omitted). Applying these
principles, it is clear that § 6330(d)(1)(B) provides only a
limited waiver of sovereign immunity, which depends on the type
of underlying tax liability at issue. The Court rejects
Plaintiffs' first argument.
Plaintiffs second argument is equally unavailing. Plaintiffs
bear the burden of showing that the dispute falls outside the
jurisdiction of the Tax Court, such that § 6330(d)(1)(B) would
apply. Under 26 U.S.C. § 6330(d)(1)(A), the Tax Court has
jurisdiction under § 6330 with respect to those levies over which it has deficiency jurisdiction,
specifically income, gift, and estate taxes. See
26 U.S.C. §§ 6211(a), 6213(a), & 6214(a). The documents submitted by the IRS
show that the underlying tax liability at issue in the present
case relates to Plaintiffs' income tax liability. See
Memorandum in Support of Motion to Dismiss, Exhs. Notice of
Determination Concerning Collection Action(s) under Section 6320
and/or 6330, dated August 24, 2005, with Attachment, Notice of
Deficiency, dated January 27, 2000. As previously stated,
Plaintiffs do not contest the authenticity of these documents.
Income tax liability specifically falls within the jurisdiction
of the Tax Court. Thus, the Court finds that Plaintiffs have
failed to show that the instant dispute falls outside the
jurisdiction of the Tax Court such that § 6330(d)(1)(B) would
THEREFORE, as set forth above, Plaintiffs fail to meet their
burden of identifying a statute waiving the United States'
sovereign immunity under the circumstances of this case. As a
result, this Court lacks subject matter jurisdiction. The United
States' Motion to Dismiss (d/e 8) is ALLOWED, and the Petition is
DISMISSED for lack of subject matter jurisdiction. This case is
IT IS THEREFORE SO ORDERED.
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