Justia Civil Rights Opinion Summaries

Plaintiff, for 22 years, contested in administrative proceedings a California Franchise Tax Board ruling that he owed close to $7.4 million in taxes, penalties, and interest. The Ninth Circuit affirmed the district court's dismissal of plaintiff's action under 42 U.S.C. 1983, which arose from his administrative proceedings. The panel held that the Tax Injunction Act, 28 U.S.C. 1341, barred plaintiff's suit because plaintiff could either pay now and litigate later, or the pay-then-protest remedy provided plaintiff a speedy remedy, even if the protest-then-pay remedy had not. The court also held that, if plaintiff pays and then protests, the California state courts would likely allow plaintiff to add constitutional claims to a state court action challenging the tax. View "Hyatt v. Yee" on Justia Law

The money that a homosexual man paid to father children through in vitro fertilization—and in particular, to identify, retain, compensate, and care for the women who served as an egg donor and a gestational surrogate—was not spent "for the purpose of affecting" his body's reproductive "function" within the meaning of I.R.C. 213. In this case, the Eleventh Circuit held that it was constrained by I.R.C. 213's plain language where taxpayer's own function within the human reproductive process was to produce and provide healthy sperm, and because taxpayer was and remained capable of performing that function without the aid of IVF-related treatments, those treatments did not affect any function of his body and did not qualify as deductible "medical care" within the meaning of Section 213(a). The court also held that the IRS's disallowance of taxpayer's claimed deduction neither violated any fundamental right nor discriminated on the basis of any suspect (or quasi-suspect) characteristic. View "Morrissey v. United States" on Justia Law

Plaintiff filed suit seeking damages under Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, alleging that IRS employees barred him from representing taxpayers before the Service without due process in violation of the Fifth Amendment. The district court dismissed the case because the Internal Revenue Code's remedial scheme for tax practicitioners foreclosed a Bivens action. The court did not reach the issue and ruled on the alternative ground that plaintiff failed to state a claim under Federal Rule of Civil Procedure 12(b)(6) because his complaint contains no allegation that defendants deprived him of a constitutionally protected interest. Accordingly, the court affirmed the judgment. View "Bowman v. Iddon" on Justia Law

Plaintiffs filed suit against the IRS and several of its individual employees, seeking money damages by way of relief under Bivens v. Six Unknown Named Agents of Fed. Bureau of Narcotics, and equitable relief by way of injunction and declaratory judgment. Additionally, the complaints alleged that the IRS invaded plaintiffs’ statutory rights by violating 26 U.S.C. 6103, by conducting unauthorized inspection and/or disclosure of tax return information from their applications and the other information improperly obtained from them. The court affirmed the district court's dismissal of the Bivens actions under Rule 12(b)(6). The court held, however, that the equitable actions are not moot. After the initiation of the suits, the IRS took action to end some unconstitutional acts against at least a portion of plaintiffs. Based on these actions, the district court dismissed the equitable claims as moot. Even if the court accorded deference to the district court, the government has not carried its heavy burden of showing mootness under the voluntary cessation doctrine. Therefore, the court vacated and remanded for further proceedings with respect to the equitable claims. View "True the Vote, Inc. v. IRS" on Justia Law

This case was one of several cases involving litigation between Lands’ End and the City of Dodgeville challenging the City’s property tax assessment of Lands’ End’s headquarters. In 2009, Lands’ End made an offer of settlement, which the City rejected. Eventually, the court of appeals remanded the matter to the circuit court with directions to enter judgment in favor of Lands’ End in the amount of $724,292 plus statutory interest. At issue on remand was whether Lands’ End was entitled to interest at the statutory rate of interest in effect when the offer of settlement was made under Wis. Stat. 807.01(4) or at the statutory rate of interest in effect when Lands’ End recovered the judgment under the amended version of the statute. The circuit court awarded interest at “1 percent plus the prime rate,” the rate in the amended version of the statute. The Supreme Court affirmed, holding (1) Lands’ End did not have a vested right in the twelve percent interest rate in effect in section 807.01(4) at the time Lands’ End made its offer of settlement; and (2) awarding interest under the amended version of the statute did not violate the Due Process or Equal Protection clauses of the federal and state constitutions. View "Lands' End, Inc. v. City of Dodgeville" on Justia Law

After plaintiffs challenged a substantial increase in the taxes on two properties they own, the Parish sent two tax assessors to inspect the property. Plaintiffs filed suit in state court alleging violations of their state and federal constitutional rights stemming from the inspection. After removal to federal court, the district court determined that inspector Lloyd Handorf was not entitled to qualified immunity because he had exceeded the scope of his consent and therefore violated plaintiffs’ Fourth Amendment rights. Specifically, the district court determined that while Handorf had consent to conduct a tax appraisal, he exceeded this consent by: (1) being on the curtilage; (2) peering into the windows; and (3) opening the pool house door. The court concluded that there is no guidance within this circuit regarding the actions a tax appraiser may take in an assessment. Further, other than conclusory allegations, plaintiffs have not identified the proper course of conduct for a tax appraiser. Therefore, the court reversed the judgment and concluded that Handorf is entitled to qualified immunity because plaintiffs' constitutional right was not clearly established at the time of the challenged conduct. View "King v. Louisiana Tax Commission" on Justia Law

Plaintiff filed a class action lawsuit against the City of Los Angeles challenging the validity of a certain tax and seeking a refund of taxes. In 2007, during discovery proceedings in the underlying litigation, the trial court determined that certain documents the City possessed were privileged under either the the attorney-client privilege or the privilege for attorney work product. In 2013, Plaintiff filed a request under the California Public Records Act seeking to obtain copies of documents relating to the tax at issue. The City’s administrative office, in response, inadvertently provided Plaintiff with some of the privileged documents. The City filed a motion for an order compelling the return of the privileged material. The trial court denied the motion, concluding that the production of the documents under the Public Records Act had waived any privilege. The Court of Appeal affirmed. The Supreme Court reversed, holding that Cal. Gov’t Code 6254.5, which generally provides that “disclosure” of a public record waives any privilege, applies to an intentional, not an inadvertent, disclosure. Remanded. View "Ardon v. City of Los Angeles" on Justia Law

As part of an investigation into the 2008 tax liability of Defendant and his wife, the IRS served a summons on Defendant requiring him to appear for an interview and to produce banking and financial records. Defendant refused to answer any questions and did not provide the requested documents. The government filed a petition to enforce the portion of the summons seeking the production of the documents. In response, Defendant asserted a Fifth Amendment claim of privilege over his compelled act of producing the documents. The district court ultimately ordered Defendant to produce all of the requested documents, including those covered and those not covered by the Bank Secrecy Act (BSA). The First Circuit affirmed the district court’s enforcement of the summons as to documents required to be kept under the BSA and vacated the enforcement of the summons for documents not subject to the BSA, holding that a taxpayer must comply with an IRS summons for documents he or she is required to keep under the BSA, where the IRS is civilly investigating the failure to pay taxes and the matter has not been referred for criminal prosecution. View "United States v. Chen" on Justia Law

The City of Fernley filed a complaint seeking declaratory and injunctive relief arguing that the Local Government Tax Distribution Account under Nev. Rev. Stat. 360.660 violates the Separation of Powers Doctrine and the prohibition on special or local legislation under Nev. Const. art IV, 20. The district court entered summary judgment in favor of the State. The Supreme Court affirmed, holding that the district court properly found the Local Government Tax Distribution Account to be general legislation because the system is a “general law that applies neutrally to local government entities and is based on classifications that are rationally related to achieving the Legislature’s legitimate government objective of promoting general-purpose governments that have public services.” View "City of Fernley v. State, Dep't of Taxation" on Justia Law

Guam taxpayers filed a class action suit against Guam and its officers, alleging that Guam violated the tax provisions of the Organic Act of Guam, 48 U.S.C. 1421i, by failing timely to refund overpayments, and, via a claim brought under 42 U.S.C. 1983, the taxpayers also challenged the arbitrary expedited refund program as a violation of equal protection. The district court granted summary judgment to the taxpayers on both claims, entered a permanent injunction both ending the expedited refund program and requiring Guam to pay approved refunds in a timely manner, and awarded substantial attorney’s fees and costs. The court concluded that Guam's section 1983 arguments did not implicate subject matter jurisdiction, but nonetheless, the court exercised its discretion in considering Guam's section 1983 arguments; the official-capacity defendants in this case are “persons” within the meaning of section 1983 for purposes of prospective relief; even if the territorial officials had been obliged by federal law to institute the arbitrary expedited refund process - which they most certainly were not - they were empowered to act only in their capacities as territorial officers; and the district court did not abuse its discretion in requiring that Guam pay refunds within six months once Guam determines that the requests are valid and not subject to investigation or audit. Accordingly, the court affirmed the judgment. View "Paeste v. Government of Guam" on Justia Law