The opinion of the court was delivered by: John D. Bates United States District Judge
Plaintiff Green Miller, Jr. filed this suit in late 2006 seeking to set aside defendant District of Columbia's ("defendant" or "the District") sale of two of his properties at a tax auction and to recover damages for the District's allegedly unlawful possession of two others. The Court denied plaintiff's request for a temporary restraining order ("TRO"), both because of substantial doubt that subject-matter jurisdiction lies in this court and because plaintiff had failed to demonstrate irreparable harm. Miller v. District of Columbia, Civ. A. No. 06-1935, 2006 U.S. Dist. LEXIS 84120, at *8-*13 (D.D.C. Nov. 20, 2006). Defendant has now moved to dismiss plaintiff's suit for lack of subject-matter jurisdiction. For the reasons set forth below, the Court will grant in part and deny in part defendant's motion, and will refer plaintiff's surviving claim to the U.S. Bankruptcy Court for the District of Columbia pursuant to 28 U.S.C. § 157(a) and DCt.LBR 5011-1.
The facts are drawn essentially verbatim from this Court's previous opinion denying the TRO. See 2006 U.S. Dist. LEXIS 84120, at *1-*4. Plaintiff owned a group of properties in the mid-1990's. As is relevant here, he owned four properties located at (a) 1330 Belmont Street NW, (b) 1332 Belmont Street NW, (c) 2560 University Place NW, and (d) 6920 Eighth Street NW. Plaintiff owed back taxes on all four of these properties. He filed a bankruptcy petition in April of 1996. Although the filing of that petition activated the automatic-stay provision of 11 U.S.C. § 362, the District notified plaintiff of its intent to take possession of the Belmont Street properties. On September 20, 1996, the District filed suit in Superior Court to remove the cloud of title over those properties. Unbeknownst to plaintiff, however, defendant had already taken title to 1330 and 1332 Belmont through a pair of deeds issued by the mayor to the District's "Homestead Housing Preservation Program" in August of 1996. The District's quiet-title suit was eventually dismissed when one of Belmont's lien holders alerted the Superior Court to the automatic stay.
In September of 1997, the bankruptcy court issued an order confirming the reorganization plan proposed by plaintiff. Article IV of the reorganization plan, entitled "Treatment of Claims," contemplated that plaintiff would retain ownership of the Belmont properties, but stated that if he did not either sell the properties within six months for an amount sufficient to pay the back taxes or donate the properties to a non-profit group, then he would have to "abandon all claims to the lots and consent to the relief sought in the D.C. Superior Court proceeding." A consent order filed the following summer modified the original reorganization plan in some respects and also clarified that plaintiff would "consent to judgment in any quiet title action" brought by defendant if he was "unable to pay off the Real Property Taxes on said lots as provided in the Confirmed Plan." Article VIII of the reorganization plan provided that the bankruptcy court would "retain jurisdiction of this case to: determine . . . any matters arising concerning the title to property of the Debtor, [or] the sale thereof . . . ; . . . hear and determine any adversary proceedings or contested matters commenced by the Debtor; . . . enforce the provisions of [this] Plan and resolve all other matters as may be set forth in the order of Confirmation [of this Plan]."
In August of 1998, one month after the reorganization plan was modified, plaintiff learned that the District had taken title to the Belmont properties two years earlier. The District finally returned the Belmont properties to plaintiff via a quit-claim deed in June of 2002. Meanwhile, taxes on the two remaining properties, one on Eighth Street NW and another on University Place NW, continued to accrue. Believing that the damages he had suffered over the two years during which defendant possessed the Belmont properties exceeded the taxes that he owed on the two other properties for the 2005 year, plaintiff refused to pay those taxes. On July 12, 2006, the District sold the Eighth Street and University Place properties at a tax sale.
In his pro se complaint, plaintiff sought a TRO and a permanent injunction setting aside the tax sales of the 6920 Eighth Street NW and 2560 University Place NW properties, compensatory damages for emotional distress and mental anguish, punitive damages, attorney fees and costs, and an award of rent for the six-year period of allegedly unlawful possession of the Belmont properties. Plaintiff then moved for a TRO and a permanent injunction to set aside the tax sale. This Court denied plaintiff's motion, concluding that he had shown little likelihood of success on the merits and had failed to demonstrate irreparable harm. Miller, 2006 U.S. Dist. LEXIS 84120, at *7-*13. In denying the motion, the Court expressed doubt that subject-matter jurisdiction properly lies in this court and therefore provided an opportunity for defendant to seek dismissal on that basis and for plaintiff to respond. Id. at *14. Defendant's motion to dismiss for lack of subject-matter jurisdiction, to which plaintiff has responded, is now ripe for resolution.
Under Rule 12(b)(1), the party seeking to invoke the jurisdiction of a federal court -- plaintiff here -- bears the burden of establishing that the court has jurisdiction. See US Ecology, Inc. v. U.S. Dep't of Interior, 231 F.3d 20, 24 (D.C. Cir. 2000); see also Grand Lodge of Fraternal Order of Police v. Ashcroft, 185 F. Supp. 2d 9, 13 (D.D.C. 2001) ("[A] Rule 12(b)(1) motion imposes on the court an affirmative obligation to ensure that it is acting within the scope of its jurisdictional authority."); Pitney Bowes, Inc. v. United States Postal Serv., 27 F. Supp. 2d 15, 18 (D.D.C. 1998). At the stage of litigation when dismissal is sought, a plaintiff's complaint must be construed liberally, and the plaintiff should receive the benefit of all favorable inferences that can be drawn from the alleged facts. See EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621, 624 (D.C. Cir. 1997). Additionally, a court may consider material other than the allegations of the complaint in determining whether it has jurisdiction to hear the case, as long as it still accepts the factual allegations in the complaint as true. See Jerome Stevens Pharmaceuticals, Inc. v. FDA, 402 F.3d 1249, 1253-54 (D.C. Cir. 2005); St. Francis Xavier Parochial Sch., 117 F.3d at 624-25 n.3; Herbert v. Nat'l Acad. of Scis., 974 F.2d 192, 197 (D.C. Cir.1992); Haase v. Sessions, 835 F.2d 902, 906 (D.C. Cir. 1987); Hohri v. United States, 782 F.2d 227, 241 (D.C. Cir. 1986).
In opposing defendant's motion to dismiss, plaintiff has offered no reason for the Court to question the conclusion that it tentatively reached in its prior opinion -- that it lacks subject-matter jurisdiction over plaintiffs' challenge to the sale of his properties at a tax auction and over his related request that the tax sale be "set aside." See Miller, 2006 U.S. Dist. LEXIS 84120, at *8-*9. First, the D.C. Circuit has held that District of Columbia courts have "exclusive jurisdiction over all challenges to District of Columbia taxes including those involving federal statutory or constitutional claims in lieu of (rather than concurrently with) jurisdiction in the federal courts."
Jenkins v. Wash. Convention Ctr., 236 F.3d 6, 11 (D.C. Cir. 2001); see id. at 10 ("Congress has vested exclusive jurisdiction in the District of Columbia courts over all challenges to assessments and claims for refunds of [D.C.] taxes."). To the extent that plaintiff's challenge to the sale of his properties at a tax sale calls into question the validity of the manner in which the District assesses or collects taxes or grants refunds, that challenge must be brought in Superior Court. Id.
But even if Jenkins does not foreclose subject-matter jurisdiction, the federal ("FTIA") and District of Columbia ("DTIA") Tax Injunction Acts do. The FTIA, 28 U.S.C. § 1341, bars district courts from enjoining, suspending, or restraining "the assessment, levy or collection of any tax under State law where a plain, speedy and efficient remedy may be had in the courts of such State." See Roswell v. LaSalle Nat'l Bank, 450 U.S. 503, 512 (1981).*fn1 Federal courts, including the Seventh Circuit in an opinion by Judge Posner, have held that a tax sale -- such as the one for plaintiff's Eighth Street NW and University Place NW properties -- "is a mode of tax collection," and consequently that "an action to enjoin [the tax collection], or declare it illegal, or rescind it . . . would be barred by the [FTIA]." Wright v. Pappas, 256 F.3d 635, 637 (7th Cir. 2001); see also, e.g., Deshazo v. Baldwin County, Civ. A. No. 06-0174, 2006 U.S. Dist. LEXIS 51118, at *9-*10 (S.D. Ala. July 25, 2006); Bouchard v. Clinton County, Civ. A. No. 06-0418, 2006 U.S. Dist. LEXIS 22937, at *9-*19 (N.D.N.Y. April 25, 2006). This conclusion, which rests on the rationale that a tax sale constitutes a "mode of tax collection," Wright, 256 F.3d at 637, applies with equal force to the DTIA, since its provision also employs the term "collection." See D.C. Code § 47-3307 ("No suit shall be filed to enjoin the assessment or collection by the District of Columbia or any of its officers, agents, or employees of any tax."). One aspect of plaintiff's suit constitutes an attempt "to enjoin the assessment or collection" of taxes by District officials, and therefore falls within the scope of the DTIA. Furthermore, to the extent that the FTIA also applies, its plain terms divest the Court of subject-matter jurisdiction so long as there is "a plain, speedy and efficient remedy" available in District of Columbia courts. See 28 U.S.C. § 1341. The Court pointed to just such a remedial scheme in its previous opinion. Miller, 2006 U.S. Dist. LEXIS 84120, at *7. Accordingly, the FTIA or the DTIA (or both) deprive this court of subject-matter jurisdiction over the aspect of plaintiff's suit seeking to set aside or undo the sale of his properties at a tax auction.
As mentioned in the Court's previous opinion, id. at *9 n.2, plaintiff suggests various other bases for subject-matter jurisdiction. See Compl. at 3. Three of them are unavailing. The first, 28 U.S.C. § 158, grants district courts appellate jurisdiction over challenges to decisions of bankruptcy courts. 28 U.S.C. § 158(a) ("[D]istrict courts of the United States shall have jurisdiction to hear appeals from final judgments, orders, and decrees . . . of bankruptcy judges."). Here, plaintiff's claim for damages was brought directly in the district court, thus skipping over the procedural step required for 28 U.S.C. § 158(a) to apply -- that the bankruptcy court first adjudicate the case. The second suggested basis for jurisdiction, D.C. Code § 47-847, is a District of Columbia law that provides a mechanism for owners to redeem their properties sold at tax sales. As was explained in the previous section, District of Columbia courts have exclusive jurisdiction over claims arising under the District's tax laws. See Jenkins, 236 F.3d at 11-12. With respect to the third suggested basis for jurisdiction, Article VIII of the reorganization plan approved by the bankruptcy court states that that court would "retain jurisdiction of this case to . . . determine any matters arising concerning the title to property of the Debtor, [or] the sale thereof." All of plaintiff's claims appear to be ones that concern "the title to property of the Debtor, [or] the sale thereof," and ...