United States District Court, District of Columbia
MICHAEL B. ELLIS et al., Plaintiffs,
AMY BERMAN JACKSON et al., Defendants.
TIMOTHY J. KELLY, United States District Judge
Michael Ellis, Robert McNeil, and Harold Stanley have
embarked on a seemingly unending quest to stop the federal
government from collecting unpaid income taxes. Courts in
this Circuit have repeatedly dismissed Plaintiffs' cases
for lack of subject-matter jurisdiction. These rulings have
not dissuaded Plaintiffs from tilting at windmills, however,
and judges themselves have become targets for Plaintiffs'
ill-advised jousting. Plaintiffs fare no better in these
consolidated cases, the latest chapter in their saga.
Judge G. Michael Harvey has issued a Report and
Recommendation recommending, among other things, that the
Court grant Defendants' First Amended Motion to Dismiss
these cases for lack of subject-matter jurisdiction. Upon
review of the Report and Recommendation and Plaintiffs'
objections to it, the Court adopts the Report and
Recommendation in its entirety and dismisses the cases on
consolidated cases-Ellis v. Jackson, No. 16-cv-2313
(“ Ellis ”), and Stanley v.
Lynch, No. 17-cv-22 (“Stanley”)-are
the latest volley in Plaintiffs' war to enjoin the
federal government's enforcement of the income tax
against individuals who do not file their returns. At their
core, the complaints allege that various U.S. government
employees-including everyone from a former President to three
federal judges-have concocted a “scheme” to
“enforce the income tax” on those who do not pay
it. See No. 16-cv-2313, ECF No. 3
(“Ellis Am. Compl.”) ¶ 12; No.
17-cv-22; ECF No. 3 (“Stanley Am.
Compl.”) ¶¶ 1, 3. Specifically, Plaintiffs
allege that certain Internal Revenue Service
(“IRS”) employees operate a “records
falsification” program that they use to collect taxes
from individuals who do not file a tax return, so-called
“non-filers.” See Ellis Am. Compl.
¶¶ 19-35; Stanley Am. Compl. ¶¶
42-45. To do so, IRS employees purportedly enter “a
certain sequence of numeric entries” into an IRS
database which creates the “appearance” of two
abbreviations in IRS's “Individual Master
File.” See Ellis Am. Compl. ¶¶
22-23; see also Stanley Am. Compl. ¶¶ 39,
42. These abbreviations purportedly denote falsified dates
showing when the IRS “received” a tax return from
the non-filer and when a “substitute for return”
(“SFR”) was executed, even though no tax return
was filed and no SFR created. Ellis Am. Compl.
¶ 22; see also Stanley Am. Compl. ¶ 42. As
Plaintiffs tell it, the Department of Justice
(“DOJ”) relies on the information in this
“Individual Master File” to pursue collection and
enforcement proceedings against non-filers. See
Ellis Am. Compl. ¶¶ 11, 24, 28, 32-35;
Stanley Am. Compl. ¶¶ 43-47. This scheme
is allegedly blessed by high-level government officials,
including a former President and Attorney General.
Stanley Am. Compl. ¶ 1. And in Ellis,
Plaintiffs also name three federal judges as defendants.
Ellis Am. Compl. They allege that these judges, each
of whom has agreed that federal courts lack subject-matter
jurisdiction over similar lawsuits, have participated in the
scheme against Plaintiffs by conspiring among themselves and
with DOJ attorneys to dismiss those previous cases, including
by misstating Plaintiffs' factual allegations.
Id. ¶¶ 36-84.
assert claims under the Administrative Procedure Act, 5
U.S.C. § 551 et seq., and the First, Fourth,
and Fifth Amendments to the Constitution. Ellis Am.
Compl. ¶¶ 85-98; Stanley Am. Compl.
¶¶ 78-88. They seek various forms of relief,
including (1) a declaratory judgment that Congress has not
imposed a duty on Americans to file income tax returns, and
therefore non-filers cannot be prosecuted for failing to
file, Ellis Am. Compl. ¶¶ 100-102;
Stanley Am. Compl. ¶ 96; and (2) an injunction
prohibiting IRS and DOJ employees from taking various actions
involving the falsification or manipulation of computer
records related to tax returns, Ellis Am. Compl.
¶¶ 110-112; Stanley Am. Compl. ¶ 98.
April 26, 2017, Defendants moved to dismiss these cases.
See No. 16-cv-2313, ECF No. 8. On November 1, 2017,
Magistrate Judge Harvey issued his Report and Recommendation
relating to the motion to dismiss, as well as several other
pending motions. See No. 16-cv-2313, ECF No. 20
(“R&R”). In it, he recommends that the Court
grant the motion to dismiss Plaintiffs' complaints for
three reasons: (1) the Anti-Injunction Act
(“AIA”), 26 U.S.C. § 7421(a), deprives this
Court of jurisdiction to hear the case; (2) Plaintiffs lack
standing; and (3) their claims, which have been repeatedly
rejected in this Circuit, are frivolous. Id. at 7,
November 15, 2017, Plaintiffs filed their objections to the
Report and Recommendation. See No. 16-cv-2313, ECF
No. 21 (“Pls.' Objs.”). Specifically, they
assert that Judge Harvey: (1) failed to recuse himself or
explain his decision not to do so; (2) failed to take
judicial notice of and resolve conflicting IRS statements
about the applicability of 26 U.S.C. § 6020(b) to income
tax; (3) refused to evaluate whether the AIA shields IRS
“non-action” from judicial review; (4) failed to
determine if the equitable exception to the AIA applies; (5)
was incorrect in concluding that Plaintiffs lack standing;
(6) falsified the record in multiple instances; (7)
improperly refused to compel the IRS to produce a document;
and (8) impermissibly dismissed Plaintiffs' claims as
frivolous. Id. at 4-5.
Evaluating a Report and Recommendation
Federal Rule of Civil Procedure 72(b), when a magistrate
judge issues a report and recommendation on a dispositive
motion, “[t]he district judge must determine de novo
any part of the magistrate judge's disposition that has
been properly objected to.” Fed.R.Civ.P. 72(b)(3). But
“when a party makes conclusory or general objections,
or simply reiterates his original arguments, the Court
reviews the Report and Recommendation only for clear
error.” M.O. v. District of Columbia, 20
F.Supp.3d 31, 37 (D.D.C. 2013) (quoting Alaimo v. Bd. of
Educ. of the Tri-Valley Cent. Sch. Dist., 650 F.Supp.2d
289, 291 (S.D.N.Y. 2009)).
72(b) “does not permit a litigant to present new
initiatives to the district judge.” Taylor v.
District of Columbia, 205 F.Supp.3d 75, 89 (D.D.C. 2016)
(quoting Aikens v. Shalala, 956 F.Supp. 14, 19
(D.D.C. 1997)). “[O]nly those issues that the parties
have raised in their objections to the Magistrate Judge's
report will be reviewed by this court.” M.O.,
20 F.Supp.3d at 37 (quoting Aikens, 956 F.Supp. at
19). Indeed, “[p]arties must take before the Magistrate
Judge, ‘not only their “best shot” but all
of their shots.'” Aikens, 956 F.Supp. at
23 (quoting Singh v. Superintending Sch. Comm., 593
F.Supp. 1315, 1318 (D. Me. 1984)).
district judge may accept, reject, or modify the recommended
disposition; receive further evidence; or return the matter
to the magistrate judge with instructions.”
courts are courts of limited jurisdiction. See Gen.
Motors Corp. v. EPA, 363 F.3d 442, 448 (D.C. Cir. 2004)
(“As a court of limited jurisdiction, we begin, and
end, with an examination of our jurisdiction.”). The
law presumes that “a cause lies outside [the
Court's] limited jurisdiction” unless the party
asserting jurisdiction establishes otherwise. Kokkonen v.
Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994).
“Under Rule 12(b)(1), the plaintiff bears the burden of
establishing jurisdiction by a preponderance of the
evidence.” Ellis v. Comm'r, 67 F.Supp.3d
325, 330 (D.D.C. 2014) (citing Lujan v. Defs. of
Wildlife, 504 U.S. 555, 561 (1992)), affd, 622
Fed.Appx. 2 (D.C. Cir. 2015). “A court may consider
materials outside the pleadings to determine its
jurisdiction.” DePolo v. Ciraolo-Klepper, 197
F.Supp.3d 186, 189-90 (D.D.C. 2016) (citing Settles v.
U.S. Parole Comm'n , 429 F.3d 1098, 1107 (D.C. Cir.
2005)), affd, No. 16-5308, 2017 WL 4231143 (D.C.
Cir. June 15, 2017).
Judge Harvey recommends that this Court conclude that it
lacks subject-matter jurisdiction for three reasons: (1) the
lawsuit is barred by the AIA, (2) Plaintiffs lack standing,
and (3) their cases should be dismissed as frivolous.
Plaintiffs object to all three recommendations. The Court
addresses each in turn.
provides that, except under statutory exceptions not relevant
here, “no suit for the purpose of restraining the
assessment or collection of any tax shall be maintained in
any court by any person, whether or not such person is the
person against whom such tax was assessed.” 26 U.S.C.
§ 7421(a). “The manifest purpose of § 7421(a)
is to permit the United States to assess and collect taxes
alleged to be due without judicial intervention, and to
require that the legal right to the disputed sums be
determined in a suit for ...