The opinion
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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UNITED STATES OF AMERICA, :
:
Plaintiff, : DECISION & ORDER
v. : 19-CV-5770
:
ROGER ROWE, :
:
Defendant. :
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WILLIAM F. KUNTZ, II, United States District Judge: By Complaint filed on October 11,
2019, Plaintiff United States of America (“Plaintiff”) brings this action against Defendant Roger
Rowe (“Defendant”) pursuant to 26 U.S.C. § 7401 to reduce to judgment assessed and unpaid
federal tax liabilities owed by Defendant. Plaintiff moves for summary judgment pursuant to
Fed. R. Civ. P. 56. ECF No. 20. Defendant moves to dismiss pursuant to Fed. R. Civ. P.
12(b)(6) and for summary judgment pursuant to Fed. R. Civ. P. 56. ECF No. 23. For the reasons
stated below, the Court grants Plaintiff’s motion for summary judgment in its entirety and denies
Defendant’s motions.
BACKGROUND AND PROCEDURAL HISTORY
The Court finds the following facts from the Plaintiff’s Local Rule 56.1 Statements,
declarations, and other evidence submitted in support of the motion, to be undisputed or
construed in the light most favorable to Defendant, the non-moving party, for the purposes of
evaluating Plaintiff’s motion. Plaintiff sent the required Local Rule 56.2 Notice to Defendant.
ECF No. 20 at 2. However, Defendant did not submit a Statement of Undisputed Facts in
accordance with Local Civil Rule 56.1 neither in support of his own motion nor in opposition to
Plaintiff’s motion.1 Defendant also did not cite evidence in support of his motion as required by
Fed. R. Civ. P. 56(c).2 “[P]ro se status ‘does not exempt a party from compliance with relevant
1 “Significantly, the requirement of filing a Rule 56.1 statement is not waived due to a litigant’s pro se status.” Bristol
v.Schenk, 14-CV-6647, 2017 WL 9485715, at *4 (E.D.N.Y. July 31, 2017) (Tomlinson, Mag. J.) (collecting cases).,
report and recommendation adopted, 14-CV-6647, 2017 WL 4277158 (E.D.N.Y. Sept. 25, 2017) (Bianco, J.).
2 A party moving for summary judgment under Rule 56 must submit a “separate, short and concise statement, in
numbered paragraphs, of the material facts as to which the moving party contends there is no genuine issue to be
tried.” Antwi v. Health & Human Sys. (Ctrs.) F.E.G.S., 13-CV-835, 2014 WL 4548619, at *4 (S.D.N.Y. Sept. 15,
2014) (Ramos, J.) (denying pro se plaintiff’s motion seeking summary judgment for failing to comply with Local Rule
56.1).
rules of procedural and substantive law.’” Jenn-Ching Luo v. Town of Hempstead, 06-CV-0082,
2007 WL 9706846, at *2 (E.D.N.Y. June 29, 2007) (Spatt, J.) (citing Traguth v. Zuck, 710 F.2d
90, 95 (2d Cir. 1983)).
Accordingly, the Court finds as true those statements in Plaintiff’s Local Rule 56.1
Statement, which are supported by citations to evidence. E.D.N.Y. Local Rules 56.1(c)–(d).
I. Facts
On October 19, 2009, a delegate of the Secretary of the Treasury assessed a trust fund
recovery penalty (“TFRP”) against Defendant, as a responsible person of Integrated Construction
Management, Inc. (“ICM”) who willfully failed to collect, truthfully account for and pay over to
the United States the income and Federal Insurance Contribution Act taxes withheld from the
wages of ICM employees for the quarterly tax period ending on December 31, 2007 through
September 30, 2008. Pl.’s Statement of Facts ¶ 7, ECF No. 20 (“Pl. St.”). Defendant has
acknowledged the trust fund penalty was assessed within the time required by the statute, id. ¶ 8,
yet has failed to fully pay the assessment and the interests accrued, id. ¶ 9.
II. Procedural History
Plaintiff filed suit against Defendant on October 11, 2019. Compl., ECF No. 1. On
October 28, 2019, Defendant filed an Answer to the Complaint. ECF No. 6. After a pre-motion
conference held on January 24, 2020, the Court granted the parties’ applications to make cross-
motions for summary judgment. ECF No. 16. On March 20, 2020, both parties filed their
motions and memoranda of law. ECF Nos. 20, 21, 22, 23, 24. On August 28, 2020, Defendant
filed a notice regarding correction of false statements of material fact. ECF No. 27. Plaintiff
filed a letter in response on September 1, 2020, ECF No. 28, and Defendant filed a reply on
September 3, 2020, ECF No. 29.
LEGAL STANDARD
Summary judgment is appropriate where the movant establishes there exists no genuine
issue as to any material fact, and the movant is entitled to summary judgment as a matter of law.
Fendi Adele, S.R.L. v. Ashley Reed Trading, Inc., 507 F. App’x 26, 29 (2d Cir. 2013). In
deciding a motion for summary judgment, the Court must “construe the facts in the light most
favorable to the non-moving party and must resolve all ambiguities and draw all reasonable
inferences against the movant.” Brod v. Omya, Inc., 653 F.3d 156, 164 (2d Cir. 2011) (quoting
Williams v. R.H. Donnelley, Corp., 368 F.3d 123, 126 (2d Cir.2004)). The movant has the
burden of showing the absence of a disputed issue of material fact, after which the burden shifts
to the nonmoving party to present specific evidence showing a genuine dispute. Brown v. Eli
Lilly & Co., 654 F.3d 347, 358 (2d Cir. 2011).
“The same standard of review applies when the court is faced with a cross-motion for
summary judgment. When evaluating cross-motions for summary judgment, the Court reviews
each party’s motion on its own merits and draws all reasonable inferences against the party
whose motion is under consideration.” Gustavia Home, LLC v. Hoyer, 362 F. Supp. 3d 71, 78
(E.D.N.Y. 2019) (Chen, J.) (internal citations and alterations omitted).
DISCUSSION
After careful review of the motion papers submitted by both parties, see ECF Nos. 20, 21,
22, 23, 24, Defendant’s notice regarding correction of false material fact, ECF Nos. 27, 29, and
the Plaintiff’s response, ECF No. 28, the Court finds there are no genuine issues of material fact
and GRANTS Plaintiff’s motion for summary judgment.
Plaintiff takes the position: (1) 26 U.S.C. § 6502(a) is the applicable statute of limitations
for collection of a TFRP assessment resulting in a statute of limitations of 10 years after the
October 19, 2009 assessment; (2) Defendant was a responsible person within the meaning of 26
U.S.C. § 6672; and (3) Defendant meets the willfulness requirements of 26 U.S.C. § 6672. Pl.
Mem. in Supp. Mot. for Summ. J. at 6–10, ECF No. 20.
In his cross-motion, Defendant argues Plaintiff failed to state a claim pursuant to Fed. R.
Civ. P. 12(b)(6). Def.’s Mem. in Supp. Mot. to Dismiss and Summ. J., at 5–6, ECF No. 23.
Defendant further claims he is entitled to summary judgment because the statute of limitations
“prohibits Defendant from being prosecuted, tried, or punished for these claims.” Id. at 8.
Defendant takes the position the relevant statutes are 26 U.S.C. §§ 6531, 6533 and 28 U.S.C.
§ 2462, which provide for a six-year statute of limitations. Id. at 6–10.
I. Plaintiff’s Prima Facie Case
Plaintiff brought action seeking to reduce to judgment trust fund liability assessments
made against Defendant. “Section 6672 of the IRS Code was designed to ensure that employers
would comply with their obligation to withhold taxes and to pay the taxes withheld by subjecting
the employers’ officers responsible for the withholding and payment of taxes to personal
liability.” Skouras v. United States, 854 F. Supp. 962, 971 (S.D.N.Y. 1993) (Patterson, J.), aff’d,
26 F.3d 13 (2d Cir. 1994) (internal quotation omitted). Section 6672, which governs the
imposition of TFRP’s, provides:
Any person required to collect, truthfully account for, and pay over
any tax imposed by this title who willfully fails to collect such tax,
or truthfully account for and pay over such tax, or willfully attempts
to in any manner to evade or defeat any such tax or the payment
thereof, shall, in addition to other penalties provided by law, be
liable to a penalty equal to the total amount of the tax evaded, or not
collected, or not accounted for and paid over.
26 U.S.C. § 6672(a). “It is well established that the statute requires two elements to be
present before personal liability for unpaid withholding taxes attaches: first, the individual must
be a person responsible for the collection and payment of withholding taxes, i.e., he must have
the authority to direct the payment of corporate funds; second, the individual’s failure to comply
with the statute must be willful.” Hochstein v. United States, 900 F.2d 543, 546 (2d Cir. 1990).
Plaintiff has established a prima facie case of Defendant’s liability. For the first element
of responsibility, Defendant concedes he was a “responsible person” at ICM during the relevant
period. Def.’s Ltr. at 1, ECF No. 15. As to the second element of willfulness, Plaintiff has
provided employment tax returns from October 2007 through September 2008 signed by
Defendant, Decl. of Thelma A. Lizama (“Lizama Decl.”), Ex. 9, ECF No. 20, and
correspondences from the IRS to Defendant attempting to collect liabilities at issue and
outstanding liabilities from earlier quarters, Lizama Decl., Ex. 12, ECF No. 20. Plaintiff also
provided evidence Defendant signed payroll and other checks for ICM during the period in
question, instead of remitting funds in trust for the benefit of the United States. Lizama Decl.,
Ex 11, ECF No. 20; Lizama Decl., Exs. 18, 19A, 19B, ECF No. 24. This evidence demonstrates
Defendant’s willfulness, as he knew of ICM’s obligations to pay withholding taxes and knew
ICM funds were being used for alternative purposes.
Plaintiff has therefore demonstrated a prima facie case for Defendant’s liability.
II. Defendant’s Alleged Affirmative Defenses
Once a prima facia case is established, the burden then shifts to Defendant who “must
come forward with specific evidence demonstrating the existence of a genuine dispute of
material fact.” Brown, 654 F.3d at 358. “When the moving party has carried its burden under
Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt
as to the material facts.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586
(1986). Defendant has failed to meet his burden.
Defendant argues Plaintiff “failed to provide sufficient evidence proving Defendant
willfully failed to collect such tax” and “the government failed to provide evidence that a balance
remains due” for the periods at issue. Def.’s Mem. in Opp’n to Pl.’s Mot. for Summ. J. at 5, ECF
No. 21 (“Def. Opp.”). Having determined Plaintiff has established its prima facie case, the Court
rejects this defense. Signature Bank v. HKD Prods., Inc., 12-CV-6149, 2013 WL 1130247, at *2
(S.D.N.Y. Mar. 19, 2013) (Keenan, J.) (rejecting failure-to-state-a-claim defense where Plaintiff
“ha[d] established a prima facie case”).
Defendant also argues Plaintiff’s claim is barred by the statute of limitations, claiming 26
U.S.C. §§ 6531, 6533 and 28 U.S.C. § 2462 govern suits to collect a TFRP. Def. Opp. 7–14.
Defendant is incorrect. 26 U.S.C. § 6502(a) prescribes the applicable statute of limitations for
collections of a TFRP assessment. 26 U.S.C. § 6671(a) explicitly provides TFRP “shall be
assessed and collected in the same manner as taxes.” United States v. Rozbruch, 28 F. Supp. 3d
256, 264 (S.D.N.Y. 2014) (Gorenstein, J.), aff’d, 621 F. App’x 77 (2d Cir. 2015) (quoting 26
U.S.C. § 6671(a)). A timely assessed “tax may be collected . . . by a proceeding in court, but
only if the levy is made or the proceeding begun within 10 years after the assessment of the tax.”
26 U.S.C. § 6502(a).
A TFRP was assessed against Defendant on October 19, 2009. Defendant has
acknowledged this assessment was performed “within the time frame proscribed by law.” Pl. St.
¶ 8. Plaintiff filed the instant action on October 11, 2019, eight days short of the ten-year statute
of limitations. 26 U.S.C. § 6502(a). Accordingly, the Court rejects Defendant’s argument
Plaintiff’s claim is barred by the statute of limitations.
Finally, Defendant claims his actions did not rise to the level of recklessness to warrant
summary judgment. Def. Opp. at 14–16. Defendant fails to provide a statement of material facts
nor cite to any “specific evidence” in support of his claim. See Fincher v. Depository Tr. &
Clearing Corp., 06-CV-9959, 2008 WL 4308126, at *3 (S.D.N.Y. Sept. 17, 2008) (Pauley, J.)
(“A [non-moving party’s] self-serving statement, without direct or circumstantial evidence to
support the charge, is insufficient to defeat a motion for summary judgment.”), aff’d, 604 F.3d
712 (2d Cir. 2010); Jenn-Ching Luo, 2007 WL 9706846, at *2 ( “[P]ro se status ‘does not
exempt a party from compliance with relevant rules of procedural and substantive law.’”).
III. Defendant’s Cross-Motion
Defendant brings a cross-motion for summary judgment and motion to dismiss arguing
Plaintiff failed to state a claim and violated the statute of limitations. Defendant failed to provide
a statement of material fact and does not cite to evidence in the record as required by Fed. R.
Civ. P. 56(c) and Local Civil Rule 56.1. Because the Court has concluded Plaintiff is entitled to
summary judgment, Defendant’s cross-motion is necessarily dismissed. See Colavito v. N.Y.
Organ Donor Network, Inc., 356 F. Supp. 2d 237, 238 (E.D.N.Y. 2005) (Irizarry, J.).
CONCLUSION
For the foregoing reasons, the Court hereby DENIES Defendant’s motion for summary
judgment, ECF No. 23, and GRANTS Plaintiff’s cross-motion for summary judgment in its
entirety, ECF No. 20.
SO ORDERED.
s/ WFK
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HON. WILLIAM F. KUNTZ, II
UNITED STATES DISTRICT JUDGE
Dated: September 16, 2020
Brooklyn, New York