United States District Court, N.D. Texas, Fort Worth Division
FINDINGS, CONCLUSIONS, AND RECOMMENDATION OF THE
UNITED STATES MAGISTRATE JUDGE
JEFFREY L. CURETON, UNITED STATES MAGISTRATE JUDGE.
to the District Court's May 1, 2018 Order Referring Case,
pending before the Court is the United States' Petition
to Enforce Internal Revenue Service ("IRS") Summons
[doc. 1], filed November 1, 2017. In the Petition, the
government requested, inter alia, that the Court
issue a show cause order directing Respondent Bill R. Waldrop
("Waldrop") to show cause why an order should not
be issued directing Waldrop to appear before an officer of
the IRS to give testimony and produce such records as were
requested in the summons. (Petition to Enforce IRS Summons
("Petition") at 4.) Having carefully considered the
Petition and its attachments and the applicable law, the
Court recommends that the government's Petition be
April 5, 2018, the Honorable Reed O'Connor issued an
order for Waldrop to show cause, at a hearing set for Monday,
May 7, 2018 at 10:00 a.m., why the Petition should not be
enforced. The Court specially appointed IRS Revenue Officer
Tackno ("Revenue Officer Tackno") or any other
Revenue Officer to serve the show cause order and a copy of
the Petition on Waldrop. In a Declaration of Service dated
April 9, 2018, Revenue Officer Tackno declared under penalty
of perjury that he, on April 9, 2018, personally served on
Waldrop the show cause order and a copy of the Petition.
Court held the show cause hearing on Monday, May 8, 2018.
Waldrop did not appear as ordered. According to information
contained in the Petition, as well as the Exhibits attached
to the Petition, including a Declaration by Revenue Officer
Tackno, Tackno is investigating the tax liability and
delinquent tax returns of Waldrop for the calendar years
ending in 2010, 2011, 2012, 2013, 2014, and
2015. On April 6, 2017, Revenue Officer Thomas
E. Douglas ("Revenue Officer
Douglas") issued an IRS summons to Waldrop, pursuant
to section 7602 of the Internal Revenue Code of 1954, to
obtain delinquent tax returns for calendar years set forth
above. A copy of the summons was served on Waldrop on April
10, 2017. The summons required Waldrop to appear before a
Revenue Officer at the IRS office located at 5450 Stratum Dr.
in Fort Worth, Texas on May 2, 2017. According to the
certificate of service of summons, on April 10, 2017, Tackno
handed an attested copy of the summons to Waldrop.
Subsequently, on May 2, 2017, Waldrop failed to appear.
on June 6, 2017, the Department of Treasury, Office of Chief
Counsel, sent Waldrop a letter noting that he had been served
with summons and giving him an opportunity to respond to the
summons before legal action was initiated. The letter, which
was sent to Waldrop via first-class mail, was not returned as
unclaimed and is presumed received. Again, Waldrop did not
on August 14, 2017, the United States Attorney's Office
sent Waldrop a letter, via certified mail, return-receipt
requested as well as via first class mail, noting that he had
been served with the summons and giving him an opportunity to
respond before legal action was initiated. The certified mail
receipt was returned signed by Waldrop.
any person refuses to obey an IRS summons, the government may
seek judicial enforcement of the summons. 26 U.S.C. §
7604. It is well settled that the government's prima
facie case for enforcement requires only a
"minimal" initial showing that the summons was
issued in good faith, i. e., that (1) it was issued
for a proper purpose; (2) that the material sought is
relevant to that purpose; (3) that the information sought is
not already within the Commissioner's possession; and (4)
that the administrative steps required by the Internal
Revenue Code have been followed. United States v.
Powell, 379 U.S. 48, 57-58 (1964); see Barquero v.
United States, 18 F.3d 1311, 1316 (5th Cir. 1994);
United States v. McCoy, 954 F.2d 1000, 1004 (5th
Cir. 1992). This showing "may be made by a simple
affidavit filed with the petition to enforce by the agent who
issued the summons." United States v.
Linsteadt, 724 F.2d 480, 482 (5th Cir. 1984); see
United States v. Davis, 636 F.2d 1028, 1034 (1981). Once
the government makes this minimal showing, the burden shifts
to the party resisting the summons to challenge it on any
appropriate ground, including demonstrating an improper
purpose of the summons or abuse of the court's process.
See United States v. LaSalle Nat'l Bank, 437
U.S. 298 (1978); Powell, 379 U.S. at 58;
McCoy, 954 F.2d at 1004. In other words, the
taxpayer or the party challenging the summons bears the
"heavy" burden of rebutting the government's
prima facie showing for enforcement of a summons. See
Mazurek v. United States, 271 F.3d 226, 230 (5th Cir.
case, the declaration of Revenue Officer Tackno establishes
that the IRS needs the information summoned to investigate
the federal tax liability of Waldrop and that the information
may be relevant to the examination of such tax liability for
the periods ending December 31, 2010 through December 31,
2015. Revenue Officer Tackno's declaration adequately
meets the United States' burden of establishing a
legitimate purpose in issuing the summons and that the
information sought may be relevant for that purpose. His
declaration also adequately meets the United States'
burden of establishing that it does not have possession of
the records summonsed. Waldrop failed to meet his heavy
burden of rebutting the government's prima facie showing
for enforcement of a summons.
on the foregoing, the Court finds that the Internal Revenue
Service summons issued by Revenue Officer Tackno was
authorized and properly served pursuant to the provisions of
26 U.S.C. §§7602 and 7603, and that jurisdiction to
enforce the summons in this action properly exists in this
Court pursuant to 26 U.S.C. §7604(a). The Court finds
that the summons, which is the subject matter of this action,
(1) was issued for a legitimate purpose pursuant to the
Internal Revenue Code; (2) seeks information relevant for
that purpose; and (3) seeks testimony and documents that are
not presently in the possession of the Internal Revenue
Service. The Court specifically finds that the purpose of the
summons was to secure testimony, records and documents
relating to Waldrop's tax liability to determine the
amount of his tax liability. The summons was issued in
compliance with all applicable statutes, rules, and
regulations and there is no evidence that there is a
"Justice Department referral" in effect with
respect to Waldrop, or any person whose tax liability is at
issue pursuant to said summons, as that term is defined in 26
U.S.C. 7602(d).Accordingly, the requirements set forth in
United States v. Powell, supra, have been satisfied,
and the government is entitled to enforcement of the summons.
United States v. LaSalle National Bank, 437 U.S.
recommended that the Petition to enforce the summons be
GRANTED, and that Waldrop be
ORDERED to appear before Revenue Office
Tackno, or another officer of the IRS, at 5450 Stratum Dr.,
Fort Worth, Texas 76137, on Tuesday, June 26, 2018 at 10:00
a.m. to testify and produce all documents, records, books,
records, and receipts specified in the summons attached as
Exhibit "A" to the Petition of the United States of
America filed in this matter. The Court further recommends
that all court costs be taxed against Waldrop.
OF RIGHT TO OBJECT TO PROPOSED FINDINGS, CONCLUSIONS AND
RECOMMENDATION AND CONSEQUENCES OF FAILURE TO
28 U.S.C. § 636(b)(1), each party to this action has the
right to serve and file specific written objections in the
United States District Court to the United States Magistrate
Judge's proposed findings, conclusions, and
recommendation within fourteen (14) days after the party has
been served with a copy of this document. The United States
District Judge need only make a de novo determination of
those portions of the United States Magistrate Judge's
proposed findings, conclusions, and recommendation to which
specific objection is timely made. See 28 U.S.C.
§ 636(b)(1). Failure to file by the date stated above a
specific written objection to a proposed factual finding or
legal conclusion will bar a party, except upon grounds of
plain error or manifest injustice, from ...