Minemyer v. CIR

FILED
United States Court of Appeals
PUBLISH Tenth Circuit
UNITED STATES COURT OF APPEALS April 22, 2021
Christopher M. Wolpert
FOR THE TENTH CIRCUIT Clerk of Court
_________________________________
JOHN THOMAS MINEMYER,
Petitioner - Appellant,
v. No. 19-9003
COMMISSIONER OF INTERNAL
REVENUE,
Respondent - Appellee.
_________________________________
Appeal from a Decision of the United States Tax Court
(CIR No. 22182-10)
_________________________________
Submitted on the briefs:*
John Thomas Minemyer, pro se.
Richard E. Zuckerman, Principal Deputy Assistant Attorney General, Ellen Page DelSole
and Anthony T. Sheehan, Attorneys, Tax Division, United States Department of Justice,
Washington, D.C., for Respondent – Appellee.
_________________________________
Before MATHESON, BRISCOE, and CARSON, Circuit Judges.
_________________________________
BRISCOE, Circuit Judge.
_________________________________
*
After examining the briefs and appellate record, this panel has determined
unanimously to honor the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
submitted without oral argument.
John Minemyer, proceeding pro se, appeals two orders from the United States
Tax Court. The first order granted the Commissioner of Internal Revenue’s
(“Commissioner’s”) Motion for Partial Summary Judgment and denied Minemyer’s
Motion for Summary Judgment. The second order denied Minemyer’s Motion for
Reconsideration. Neither order, however, is a final decision by the Tax Court.
Further, Minemyer’s appeal from those orders did not ripen after the Tax Court
issued an opinion, without a “decision,” addressing the only remaining claim.
Accordingly, we DISMISS Minemyer’s appeal for lack of appellate jurisdiction.
I
Minemyer was convicted in the United States District Court for the District of
Colorado of one count of willfully attempting to evade taxes under 26 U.S.C. § 7201.
Minemyer’s conviction was related to the tax year 2000; an additional charge related
to the tax year 2001 was dismissed. Pursuant to a plea agreement, Minemyer
“agree[d] to pay restitution to the Internal Revenue Service (“IRS”) in the amount of
all taxes, interest, and penalties due and owing from the tax years 2000 and 2001.”
ROA at 66. The restitution entered by the district court was to represent “the full
amount of the IRS’s loss.” Id. at 72. And the IRS’s loss was specified to be
$200,981.22. Id.; see also id. at 70 (“The total loss for both years is $200,981.22.”).
The district court sentenced Minemyer to twelve months of imprisonment. Id. at 51.
The district court also ordered Minemyer to pay special assessment of $100, a fine of
$25,000, and restitution of $200,981.22, plus interest. Id. at 54.
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Following his conviction and sentencing, the Commissioner sent Minemyer a
notice of deficiency and civil fraud penalties for tax years 2000 and 2001. The
Commissioner assessed total deficiencies of $197,505 and total penalties of
$148,128.75. Id. at 17. Minemyer petitioned the Tax Court, asserting that the
deficiencies had already been assessed by the district court and that the district
court’s restitution order included all taxes, penalties, and interest. The Tax Court
granted partial summary judgment to the Commissioner, upholding the deficiencies
for tax years 2000 and 2001, and also upholding the civil fraud penalty for tax year
2000. The Tax Court also determined that Minemyer’s liability for the civil fraud
penalty for tax year 2001 “remain[ed] for possible trial.” Id. at 1693. Minemyer
filed a motion for reconsideration, which the Tax Court denied. Minemyer then filed
a notice of appeal from the denial of reconsideration.
The Commissioner filed a motion to dismiss Minemyer’s appeal, asserting that
this court lacked jurisdiction because Minemyer’s civil fraud penalty for tax year
2001 had not yet been resolved. During the pendency of this appeal, the Tax Court
issued a “Memorandum Findings of Fact and Opinion” in which it concluded that
Minemyer was “not liable for the fraud penalty for 2001.” Suppl. ROA at 18. The
Tax Court concluded that “[a]n appropriate decision will be entered.” Id. The Tax
Court has not yet, however, issued such a decision. We asked the parties to file
supplemental briefs addressing several potential bases for our jurisdiction including
what, if any, impact the Tax Court’s Memorandum Findings of Fact and Opinion had
on our jurisdiction. In their supplemental briefing, both parties agreed that the Tax
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Court’s opinion was not a “decision” and thus had no jurisdictional impact. The
Commissioner continued to maintain that we lack jurisdiction, while Minemyer
argued we have, and have always had, jurisdiction over the two Tax Court orders
appealed.
II
“The United States Courts of Appeals . . . shall have exclusive jurisdiction to
review the decisions of the Tax Court . . . in the same manner and to the same extent
as decisions of the district courts in civil actions tried without a jury[.]” 26 U.S.C.
§ 7482(a)(1). “For a Tax Court’s decision to be reviewable, it must be final.”
Whitlock’s Estate v. C.I.R., 547 F.2d 506, 509 (10th Cir. 1976); see also 28 U.S.C.
§ 1291 (“The courts of appeals . . . shall have jurisdiction of appeals from all final
decisions of the district courts of the United States . . . .”).
The Circuits are divided over whether § 7482(a)(1) provides jurisdiction where
the Tax Court disposes of some, but not all, claims arising from the same proceeding.
Under the majority approach, appellate jurisdiction exists over an order disposing of
some, but not all, claims if the Tax Court expressly determines that the order is final
and that there is no just reason to delay, similar to a Rule 54(b) certification by a
district court. See, e.g., New York Football Giants, Inc. v. C.I.R., 349 F.3d 102, 106–
07 (3d Cir. 2003); Nixon v. C.I.R., 167 F.3d 920, 920 (5th Cir. 1999) (per curiam);
Shepherd v. C.I.R., 147 F.3d 633, 635 (7th Cir. 1998); Brookes v. C.I.R., 163 F.3d
1124, 1128 (9th Cir. 1998). In contrast, the Second and Sixth Circuits have held that
appellate jurisdiction exists only once the Tax Court disposes of an entire case.
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Estate of Yaeger v. C.I.R., 801 F.2d 96, 98 (2d Cir. 1986); Schrader v. C.I.R., 916
F.2d 361, 363 (6th Cir. 1990); see also Christian v. C.I.R., 1993 WL 421646 (4th Cir.
Oct. 20, 1993) (unpublished) (per curiam). And the D.C. Circuit has held that
appellate jurisdiction exists over an order so long as the order itself is final,
regardless whether the Tax Court made a Rule 54(b)-like certification. InverWorld,
Ltd. v. C.I.R., 979 F.2d 868, 872 (D.C. Cir. 1992).
We adopt the majority approach and conclude that neither the Tax Court’s
partial grant of summary judgment nor its denial of reconsideration were immediately
appealable decisions. Section 7482 grants the courts of appeals “exclusive
jurisdiction to review the decisions of the Tax Court . . . in the same manner and to
the same extent as decisions of the district courts in civil actions tried without a
jury.” 26 U.S.C. § 7482(a)(1) (emphasis added). Thus, “we can review decisions by
the Tax Court in exactly the same circumstances in which we review decisions by the
district courts.” Shepherd, 147 F.3d at 634. Analogizing appellate jurisdiction over
tax court decisions to appellate jurisdiction over district court decisions makes
particular sense because a taxpayer may dispute a deficiency in either Tax Court or
district court. See id. at 634–35 (noting that treatment of tax refund disputes in
district court are the “closest counterpart” to deficiency disputes in Tax Court).
Requiring certification by the Tax Court, similar to a Rule 54(b)-certification
by a district court, promotes consistency and clarifies the appropriate time for taking
an appeal. Brookes, 163 F.3d at 1129 (“Treating appellate jurisdiction over the Tax
Courts as identical to appellate jurisdiction over district courts greatly simplifies an
5
already overburdened appellate system and assists in judicial efficiency.”); Shepherd,
147 F.3d at 635 (certification requirement reduces uncertainty regarding finality).
Further, the Tax Court, rather than this court, is the proper “gatekeeper” in
determining the impact of an immediate appeal. See New York Football Giants, 349
F.3d at 108 (“The Tax Court, like the district courts, enjoys a familiarity with the
underlying case that the courts of appeals do not—particularly with respect to
whether, in the interest of sound judicial administration[,] there is no just reason for
delay.”) (internal quotations omitted).
Here, the Tax Court’s partial grant of summary judgment, as well as its denial
of reconsideration, left unresolved the 2001 civil fraud penalties. Further, the Tax
Court did not certify the finality of its orders or the potential injustice of any delay.
Thus, those orders were not immediately appealable.
We recognize, as have other Circuits following the majority approach, that the
Rules of Practice and Procedure of the United States Tax Court do not contain a
counterpart to Rule 54(b) of the Federal Rules of Civil Procedure. Yet, Rule 1(b) of
the Rules of Practice and Procedure of the United States Tax Court provides that
“[w]here in any instance there is no applicable rule of procedure, the [Tax] Court
. . . may prescribe the procedure, giving particular weight to the Federal Rules of
Civil Procedure to the extent that they are suitably adaptable to govern the matter at
hand.” Accordingly, absence of a Federal Rule of Civil Procedure 54(b) counterpart
does not preclude the Tax Court from making a similar certification pursuant to Tax
Rule 1(a). See, e.g., Shepherd, 147 F.3d at 635.
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The D.C. Circuit reasoned that the phrase “in the same manner and to the same
extent” in § 7482(a)(1) “was intended only to alter the scope of review,” and not the
availability of review. InverWorld, 979 F.2d at 874 (emphasis in original). In doing
so, the D.C. Circuit relied on the legislative history for § 7482. Yet, even if that
phrase was only intended to restrict our scope of review, we see no reason why
§ 7482(a)(1) should restrict (or expand) the availability of review of Tax Court
decisions compared to district court decisions. Indeed, this court has previously
analogized the finality requirement under § 7482(a)(1) to that under § 1291.
Whitlock’s Estate, 547 F.2d at 509.
The D.C. Circuit also reasoned that a certification should not be required
because “Rule 54(b) does not ‘create’ finality under § 1291 where it does not already
exist[;] it merely allows a district court formally to decree a decision final and to
determine which final decisions in a consolidated proceeding are subject to
immediate appeal.” InverWorld, 979 F.2d at 874 (emphasis in original). The D.C.
Circuit correctly observed that Rule 54(b) did not relax the finality requirement;
rather, Rule 54(b) “was designed to relax the ‘single judicial unit’ theory which had
required all claims in an action to be disposed of before any claim could be
reviewed.” Id. at 875; see also Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 435
(1956) (holding that Rule 54(b) “does not relax the finality required of each decision,
as an individual claim, to render it appealable, but it does provide a practical means
of permitting an appeal to be taken from one or more final decisions on individual
claims, in multiple claims actions, without waiting for final decisions to be rendered
7
on all the claims in the case.”). Yet, we see no reason why the “single judicial unit”
theory should be any different in Tax Court than in district court, including the
requirement of a Rule 54(b) certification. In short, without a finding by the Tax
Court that its partial grant of summary judgment was final and that there was no just
reason to delay, similar to a Rule 54(b) certification, the Tax Court’s partial grant of
summary judgment and denial of reconsideration were not immediately appealable.1
III
Nor did the Tax Court’s partial grant of summary judgment become appealable
following the Tax Court’s “Memorandum Findings of Fact and Opinion” regarding
the 2001 civil fraud penalty. The Tax Court’s Memorandum Findings of Fact and
Opinion did not include any order or decision by the Tax Court. In fact, the
Memorandum Findings of Fact and Opinion specified that “[a]n appropriate decision
will be entered.” Suppl. ROA at 18.2
Accordingly, the Memorandum Findings of Fact and Opinion was not a
“decision” within the meaning of the Internal Revenue Code. Indeed, the Code, Tax
Court Rules, and Supreme Court caselaw all distinguish a Tax Court’s “reports” from
1
In addition to adopting the Seventh Circuit’s holding in Shepherd, we also
echo that court’s concern that the ongoing circuit split could “easily be ended through
the rulemaking process in one of two ways.” 147 F.3d at 636. “One is for the Tax
Court, using its explicit rulemaking power, to adopt a version of Rule 54(b) as a rule
of that court. Another is for the Supreme Court to use its rulemaking power to amend
the Federal Rules of Appellate Procedure to provide explicitly for appeals from Tax
Court decisions that meet the criteria of Rule 54(b).” Id.2
To date, no decision has been entered.
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its “decisions.” For example, 26 U.S.C. § 7459(b) explains that a “report” shall
include the Tax Court’s “findings of fact or opinion or memorandum opinion.”
Section 7459(c) then separately describes a “decision,” which is “rendered upon the
date that an order specifying the amount of deficiency is entered in the records of the
Tax Court . . . .” Tax Court Rule 161 describes motions to reconsider “an opinion or
findings of fact,” whereas Tax Court Rule 162 separately describes motions to
“vacate or revise a decision.” Tax Court Rule 163 further distinguishes opinions
from decisions by prohibiting the joinder of Rule 161 and Rule 162 motions. And,
the Supreme Court has distinguished the proposed findings and opinion, which may
be made by a special trial judge, from a “decision,” which may only be made by a
Tax Court judge. Freytag v. C.I.R., 501 U.S. 868, 876–77 (1991); see also 26 U.S.C.
§ 7443A(b)(7), (c) (permitting special trial judges to hear “any other proceeding
which the chief judge may designate” but prohibiting a special trial judge from
“mak[ing] the decision of the court with respect to [such a] proceeding . . . .”).
Thus, the pending claim regarding the 2001 civil fraud penalty is no more final
at this time than it was when Minemyer filed his notice of appeal. And because that
claim has not been adjudicated, Minemyer’s appeal of the Tax Court’s partial
summary judgment order has not ripened. See Lewis v. B.F. Goodrich, Co., 850 F.2d
641, 645 (10th Cir. 1988) (en banc) (holding that a premature notice of appeal ripens
“when a district court has adjudicated all remaining outstanding claims before this
appellate court acts to dismiss the appeal”).
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IV
Accordingly, we DISMISS Minemyer’s appeal for lack of appellate
jurisdiction. We DENY the Commissioner’s pending motion to dismiss as moot.
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