(PS)Sierra v. IRS ( 2022 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 PETER SIERRA, No. 2:22-cv-01309 KJM AC PS 12 Plaintiff, 13 v. ORDER 14 IRS, 15 Defendant. 16 17 Plaintiff is proceeding in this action pro se. This matter was referred to the undersigned 18 by E.D. Cal. R. 302(c)(21). Plaintiff has filed a request for leave to proceed in forma 19 pauperis (“IFP”) pursuant to 28 U.S.C. § 1915, and has submitted the affidavit required by that 20 statute. See 28 U.S.C. § 1915(a)(1). The motion to proceed IFP (ECF No. 2) will therefore be 21 granted. 22 I. SCREENING 23 A determination that a plaintiff qualifies financially for in forma pauperis status does not 24 complete the inquiry required by the statute. The federal IFP statute requires federal courts to 25 dismiss a case if the action is legally “frivolous or malicious,” fails to state a claim upon which 26 relief may be granted, or seeks monetary relief from a defendant who is immune from such relief. 27 28 U.S.C. § 1915(e)(2). Plaintiff must assist the court in determining whether the complaint is 28 frivolous, by drafting the complaint so that it complies with the Federal Rules of Civil Procedure 1 (“Fed. R. Civ. P.”). Under the Federal Rules of Civil Procedure, the complaint must contain (1) a 2 “short and plain statement” of the basis for federal jurisdiction (that is, the reason the case is filed 3 in this court, rather than in a state court), (2) a short and plain statement showing that plaintiff is 4 entitled to relief (that is, who harmed the plaintiff, and in what way), and (3) a demand for the 5 relief sought. Fed. R. Civ. P. 8(a). Plaintiff’s claims must be set forth simply, concisely and 6 directly. Fed. R. Civ. P. 8(d)(1). 7 A claim is legally frivolous when it lacks an arguable basis either in law or in fact. 8 Neitzke v. Williams, 490 U.S. 319, 325 (1989). In reviewing a complaint under this standard, the 9 court will (1) accept as true all of the factual allegations contained in the complaint, unless they 10 are clearly baseless or fanciful, (2) construe those allegations in the light most favorable to the 11 plaintiff, and (3) resolve all doubts in the plaintiff’s favor. See Neitzke, 490 U.S. at 327; Von 12 Saher v. Norton Simon Museum of Art at Pasadena, 592 F.3d 954, 960 (9th Cir. 2010), cert. 13 denied, 564 U.S. 1037 (2011). 14 The court applies the same rules of construction in determining whether the complaint 15 states a claim on which relief can be granted. Erickson v. Pardus, 551 U.S. 89, 94 (2007) (court 16 must accept the allegations as true); Scheuer v. Rhodes, 416 U.S. 232, 236 (1974) (court must 17 construe the complaint in the light most favorable to the plaintiff). Pro se pleadings are held to a 18 less stringent standard than those drafted by lawyers. Haines v. Kerner, 404 U.S. 519, 520 19 (1972). However, the court need not accept as true conclusory allegations, unreasonable 20 inferences, or unwarranted deductions of fact. Western Mining Council v. Watt, 643 F.2d 618, 21 624 (9th Cir. 1981). A formulaic recitation of the elements of a cause of action does not suffice 22 to state a claim. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555-57 (2007); Ashcroft v. Iqbal, 23 556 U.S. 662, 678 (2009). To state a claim on which relief may be granted, the plaintiff must 24 allege enough facts “to state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 25 570. “A claim has facial plausibility when the plaintiff pleads factual content that allows the 26 court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” 27 Iqbal, 556 U.S. at 678. 28 //// 1 A pro se litigant is entitled to notice of the deficiencies in the complaint and an 2 opportunity to amend unless the complaint’s deficiencies could not be cured by amendment. See 3 Noll v. Carlson, 809 F.2d 1446, 1448 (9th Cir. 1987), superseded on other grounds by statute as 4 stated in Lopez v. Smith, 203 F.3d 1122 (9th Cir.2000)) (en banc). 5 II. THE COMPLAINT 6 Plaintiff lists as his sole cause of action: “My E.I.P 3 yearly taxes were refused me.” ECF 7 No. 1 at 2. Plaintiff alleges that over the course of a year he filed for his taxes over a dozen times, 8 and as a citizen of the United States, he is entitled to his E.I.P. [Economic Improvement Plan] 9 payments. Id. The IRS wrote plaintiff a letter informing him that they could not verify his 10 identity. Id. Plaintiff writes his full date of birth and social security number on his complaint to 11 prove his identity to the court. Id. Plaintiff writes “All I want is my money. I did everything to 12 accommodate their inquiry.” Id. Plaintiff alleges he was denied $5,300 in stimulus money due to 13 the negligence of IRS employees. Id. Plaintiff attaches the letter from the IRS, dated February 14 18, 2022. ECF No. 1 at 4. The letter provides instructions on how plaintiff can verify his identity 15 to the IRS. Id. 16 III. ANALYSIS 17 The only contention in plaintiff’s complaint is that he did not receive his stimulus 18 payments under the CARES Act. The CARES Act, codified in part at Section 6428 of the 19 Internal Revenue Code, 26 U.S.C. § 6428, established a mechanism for the IRS to issue economic 20 impact payments (“E.I.P.”) to eligible individuals. Scholl v. Mnuchin (Scholl I), 489 F.Supp.3d 21 1008, 1020 (N.D. Cal. 2020), appeal dismissed, No. 20-16915, 2020 WL 9073361 (9th Cir. Nov. 22 20, 2020). Under § 6248(a), eligible individuals may receive a tax credit in the amount of $1,200 23 ($2,400 if filing a joint return), plus $500 multiplied by the number of qualifying children. Scholl 24 I, 489 F.Supp.3d at 1020 (citing 26 U.S.C. § 6428(a).). The E.I.P. amount is credited against a 25 person’s federal income tax for the year 2020. Id. 26 Under 28 U.S.C. § 1346(a)(1), federal courts have jurisdiction over civil actions “for the 27 recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or 28 collected, or any penalty claimed to have been collected without authority or any sum alleged to 1 have been excessive or in any manner wrongfully collected under the internal-revenue laws.” A 2 taxpayer’s right to bring a refund suit, however, is limited by 26 U.S.C. § 7422(a). See Dutch v. 3 Internal Revenue Dep’t of Treasury, No. SACV 12-02098-CJC, 2013 WL 7162138, at *2 (C.D. 4 Cal. Dec. 20, 2013). Section 7422(a) provides: 5 (a) No suit prior to filing claim for refund.—No suit or proceeding shall be maintained in any court for the recovery of any internal 6 revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without 7 authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until a claim for refund or credit has 8 been duly filed with the Secretary, according to the provisions of law in that regard, and the regulations of the Secretary established in 9 pursuance thereof. 10 26 U.S.C. § 7422(a). 11 A refund claim is a prerequisite to jurisdiction. Thomas v. United States, 755 F.2d 728, 12 729 (9th Cir. 1985); Yuen v. United States, 825 F.2d 244, 245 (9th Cir. 1987). Further, “[b]efore 13 filing suit in federal court for credit or refund of overpaid taxes, a taxpayer must first comply with 14 the tax refund scheme established in the Code by filing an administrative claim with the IRS. 15 U.S. v. Clintwood Elkhorn Min. Co., 553 U.S. 1, 4 (2008); Omohundro v. U.S., 300 F.3d 1065, 16 1066 (9th Cir. 2002); see 26 U.S.C. § 7422(a) (2002).” Conde v. Dep’t of the Treasury & 17 Internal Revenue Serv., No. 1:21-cv-01072-DAD-SKO, 2021 WL 6000057, at *3 (E.D. Cal. Dec. 18 20, 2021). 19 Here, plaintiff appears to be in the process of validating his identity to the IRS per the 20 instructions in the February 2022 letter, and it does not appear that he has filed an administrative 21 claim with the IRS. Filing an administrative claim with the IRS is a prerequisite to bringing a 22 claim in federal court. Based on review of the complaint, including the attached letter, it appears 23 the court does not have jurisdiction to consider plaintiff’s claims based upon the filing of his tax 24 returns. Plaintiff shall be granted leave to file an amended complaint to cure the deficiencies 25 identified in this order. 26 Alternatively, if plaintiff has not filed an administrative claim with the IRS, he may 27 choose to dismiss this action without prejudice (meaning he can bring a claim again after he 28 //// 1 completes the administrative process with the IRS) pursuant to Federal Rule of Civil Procedure 2 41(a)(1)(A). 3 IV. AMENDING THE COMPLAINT 4 If plaintiff chooses to amend the complaint, the amended complaint must allege facts 5 establishing the existence of federal jurisdiction; specifically, plaintiff must allege that an 6 administrative action has been filed and completed with the IRS and that plaintiff has a right to 7 bring this case to federal court. In addition, an amended complaint must contain a short and plain 8 statement of plaintiff’s claims. The allegations of the complaint must be set forth in sequentially 9 numbered paragraphs, with each paragraph number being one greater than the one before, each 10 paragraph having its own number, and no paragraph number being repeated anywhere in the 11 complaint. Each paragraph should be limited “to a single set of circumstances” where 12 possible. Rule 10(b). As noted above, forms are available to help plaintiffs organize their 13 complaint in the proper way. They are available at the Clerk’s Office, 501 I Street, 4th Floor 14 (Rm. 4-200), Sacramento, CA 95814, or online at www.uscourts.gov/forms/pro-se-forms. 15 Plaintiff must avoid excessive repetition of the same allegations. Plaintiff must avoid 16 narrative and storytelling. That is, the complaint should not include every detail of what 17 happened, nor recount the details of conversations (unless necessary to establish the claim), nor 18 give a running account of plaintiff’s hopes and thoughts. Rather, the amended complaint should 19 contain only those facts needed to show how the defendant legally wronged the plaintiff. 20 The amended complaint must not force the court and the defendants to guess at what is 21 being alleged against whom. See McHenry v. Renne, 84 F.3d 1172, 1177 (9th Cir. 1996) 22 (affirming dismissal of a complaint where the district court was “literally guessing as to what 23 facts support the legal claims being asserted against certain defendants”). The amended 24 complaint must not require the court to spend its time “preparing the ‘short and plain statement’ 25 which Rule 8 obligated plaintiffs to submit.” Id. at 1180. The amended complaint must not 26 require the court and defendants to prepare lengthy outlines “to determine who is being sued for 27 what.” Id. at 1179. 28 //// 1 Also, the amended complaint must not refer to a prior pleading in order to make plaintiff’s 2 amended complaint complete. An amended complaint must be complete in itself without 3 reference to any prior pleading. Local Rule 220. This is because, as a general rule, an amended 4 complaint supersedes the original complaint. See Pacific Bell Tel. Co. v. Linkline 5 Communications, Inc., 555 U.S. 438, 456 n.4 (2009) (“[n]ormally, an amended complaint 6 supersedes the original complaint”) (citing 6 C. Wright & A. Miller, Federal Practice & 7 Procedure § 1476, pp. 556-57 (2d ed. 1990)). Therefore, in an amended complaint, as in an 8 original complaint, each claim and the involvement of each defendant must be sufficiently 9 alleged. 10 Finally, do not include your social security number or full date of birth in your amended 11 complaint, as this document will be available to the public. 12 V. PRO SE PLAINTIFF’S SUMMARY 13 It is not clear that this case can proceed in federal court. The court cannot tell from your 14 complaint whether you have taken the actions necessary to bring this case to federal court— 15 specifically, whether you have filed and completed an administrative action with the IRS. Your 16 lawsuit cannot proceed unless you fix the problems with your complaint. Alternatively, if you 17 have not filed an administrative claim with the IRS, you may choose to dismiss this action 18 without prejudice (meaning you can bring a claim again after he completes the administrative 19 process with the IRS) pursuant to Federal Rule of Civil Procedure 41(a)(1)(A). 20 You are being given 30 days to submit an amended complaint that provides a proper basis 21 for federal jurisdiction and demonstrates that you have completed an administrative action with 22 the IRS. If you do not submit an amended complaint by the deadline, the undersigned will 23 recommend that the case be dismissed. 24 VI. CONCLUSION 25 Accordingly, IT IS HEREBY ORDERED that: 26 1. Plaintiff’s request to proceed in forma pauperis (ECF No. 2) is GRANTED; 27 2. The complaint at ECF No. 1 shall be SEALED; and 28 //// 1 3. Plaintiff shall have 30 days from the date of this order to file an amended complaint which 2 complies with the instructions given above. If plaintiff fails to timely comply with this 3 order, the undersigned may recommend that this action be dismissed. 4 | DATED: August 24, 2022 ~ 5 Lhar—e_ ALLISON CLAIRE 6 UNITED STATES MAGISTRATE JUDGE 7 8 9 10 1] 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28