Patrick Bohall v. United States

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 08-1373
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Patrick L. Bohall; Jan Bohall, *
*
Appellants, *
* Appeal from the United States
v. * District Court for the
* Southern District of Iowa.
United States of America; Internal *
Revenue Service; Department of the *
Treasury; Siouxland Federal Credit *
Union; Nationwide Advantage *
Mortgage Company; Beth Thompson, *
in her official and individual capacity; * [UNPUBLISHED]
Premier Senior Marketing, Inc.; *
Michael J. Kobolt, in his official *
1
capacity, *
*
Appellees. *
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Submitted: July 30, 2009
Filed: August 4, 2009
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Before MURPHY, COLLOTON, and SHEPHERD, Circuit Judges.
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PER CURIAM.
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Beth Thompson’s name was spelled incorrectly on the district court’s docket
sheet and caption. Although Michael J. Kobolt was a defendant, he was not listed as
a defendant on the district court’s docket sheet and caption.
Patrick Bohall and Jan Bohall appeal the district court’s2 dismissal of their
action to quash summonses issued by the Internal Revenue Service (IRS) to third
parties. On appeal, the Bohalls argue (1) the IRS Special Agents who issued the
summonses did not obtain the signatures of supervisory officials, which violated a
written IRS administrative order and rendered the summonses unenforceable under
United States v. Powell, 379 U.S. 48, 57-58 (1964) (to enforce summons,
Commissioner must show, inter alia, that administrative steps required by Internal
Revenue Code have been followed); (2) one of the summonses is unenforceable for
the additional reason that it was served on a “third-party recordkeeper” within the
meaning of 26 U.S.C. § 7603(b)(2)(D) (brokers), and the Bohalls did not receive
notice of that summons, as required under 26 U.S.C. § 7609(a)(2) for such
summonses; and (3) the district court deprived them of due process by converting
motions to dismiss into motions for summary judgment.
First, we conclude that the district court did not clearly err in finding that the
IRS Special Agents did not violate the administrative order at issue, because that
order, read as a whole, delegated to Special Agents (unlike some other types of
officers and agents) the authority to issue summonses without the approval or
signature of a supervisory official. See United States v. Kaiser, 397 F.3d 641, 642-43
(8th Cir. 2005) (reviewing district court’s determination under Powell for clear error);
United States v. Lask, 703 F.2d 293, 297 (8th Cir. 1983) (once IRS establishes prima
facie case, burden shifts and party challenging summons bears “heavy” burden to
disprove Powell elements or demonstrate that judicial enforcement of summons would
otherwise constitute abuse of court’s process).
Second, the district court did not err in rejecting the Bohalls’ unsubstantiated
argument that one of the parties receiving a summons was a “broker” and thus was a
2
The Honorable John A. Jarvey, United States District Judge for the Southern
District of Iowa.
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“third-party recordkeeper” within the meaning of section 7603(b)(2)(D). See 26
U.S.C. § 7603(b)(2)(D) (“third-party recordkeeper” refers to, inter alia, “any broker,”
as defined in 15 U.S.C. § 78c(a)(4)); 15 U.S.C. § 78c(a)(4) (“broker” generally means
“any person engaged in the business of effecting transactions in securities for the
account of others”); see also Robert v. United States, 364 F.3d 988, 994 (8th Cir.
2004) (“We review under a de novo standard the district court’s summary
enforcement of, and refusal to quash, an IRS summons.”).
Finally, we see no merit in the Bohalls’ argument that the procedures used by
the district court resulted in a denial of due process, especially given that the Bohalls
had an opportunity to respond to the motions to dismiss. Cf. United States v.
McDonnell Douglas Corp., 751 F.2d 220, 228-30 (8th Cir. 1984) (holding that district
court’s use of summary proceedings to enforce subpoena did not violate due process;
“[d]eparting from the summary nature of a subpoena enforcement proceeding is the
exception rather than the rule”; issues before district court were properly resolved
based on parties’ affidavits and briefs; and defendant was required to show that there
were disputed questions of material fact, but failed to do so).
The judgment of the district court is affirmed. See 8th Cir. R. 47B.
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