United States v. Kistler

THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

UNITED STATES OF AMERICA, :

: CIVIL ACTION NO. 3:21-CV-1283

Plaintiff, : (JUDGE MARIANI)

: (Magistrate Judge Carlson)

V. :

JOHN MICHAEL KISTLER, JR., :

Defendant. :

ORDER

AD NE .

AND NOW, THIS AY OF JUNE 2023, upon review of Magistrate Judge

Martin C. Carlson's Report and Recommendation (“R&R”) (Doc. 77) and all relevant

documents for clear error or manifest injustice,’ IT IS HEREBY ORDERED THAT:

1 The Court concludes that de novo review is not warranted in the circumstances presented here. If

a party timely and properly files a written objection to a Magistrate Judge's Report and Recommendation,

the District Court “shall make a de novo determination of those portions of the report or specified proposed

findings or recommendations to which objection is made.” 28 U.S.C. § 636(b)(1)(C); see also Fed. R. Civ.

P. 72(b)(3); M.D. Pa. Local Rule 72.3; Brown v. Astrue, 649 F.3d 193, 195 (3d Cir. 2011). “If a party does

not object timely to a magistrate judge's report and recommendation, the party may lose its right to de novo

review by the district court.” EEOC v. City of Long Branch, 866 F.3d 93, 99-100 (3d Cir. 2017). The de

novo standard applies only to objections which are specific. Goney v. Clark, 749 F.2d 5, 6-7 (3d Cir. 1984).

Following issuance of the R&R on July 12, 2022, Defendant filed a three-part document (Docs. 78, 78-1,

78-2) on July 28, 2022, which he docketed as a motion. Document 78 is titled “Petitioner’s Motion

Statement in Support of Remand to US Tax Court Basis is Jurisdiction and Venue are Improper.”

Document 78-1 is titled “Petitioner Notice in Opposition to Summary Judgment and Notice of Appeal to

United States Tax Court.” Document 78-2 is titled “Summary Statement in Support of Opposittion to US

Atty. Carroll's Motion for Summary Judgment Proof of Claim by the Secretary Demanded.” Only the

second of these contains any reference to the R&R or Magistrate Judge Carlson: in five of the sixty-one

paragraphs in the document, Plaintiff lodges complaints against Magistrate Judge Carlson but does not

specifically reference the R&R. (See Doc. 78-1 ff] 2, 3, 4, 9, 14.) To the extent the Court considers

“Petitioner Notice in Opposition to Summary Judgment and Notice of Appeal to United States Tax Court” to

be objections to the R&R, the document was not timely filed in that the R&R was served on Defendant via

electronic filing on July 12, 2022, and the last day for filing objections was July 26, 2022—two days before

Defendant filed the document at issue. (See Doc. 77 at 20; see also Doc. 77 Notice of Electronic Filing.)

1. The R&R (Doc. 77) is ADOPTED for the reasons set forth therein.

2. Third-Party Defendants EASi LLC’s (n/k/a/ Actalent Services, LLC) and Aerotek

Inc.'s (n/k/a Aerotek Affiliated Services, Inc.) Motion to Dismiss Third-Party

Complaint (Doc. 50) is GRANTED.

3. Third-Party Defendant Wells Fargo Bank & Trust Company, Inc.’s Motion to Dismiss

Third-Party Complaint (Doc. 53) is GRANTED.

4. Third-Party Defendant Day & Zimmermann NPS, Inc.'s Motion to Dismiss Pursuant

to Fed. R. Civ. P. 12(b)(6) (Doc. 54) is GRANTED.

5. Third-Party Defendants Peoples Security Bank and Trust Company (f/k/s Old Forge

Bank) and Fidelity Deposit & Discount Bank (s/h/a Fidelity Bank, Dunmore, PA) and

Mary Blasi’s Motion to Dismiss Defendant/Third-Party Plaintiff John M. Kistler, Jr.’s

Third-Party Complaint (Doc. 55) is GRANTED.

6. All claims against Third-Party Defendants EASi LLC’s (n/k/a/ Actalent Services, LLC)

and Aerotek Inc.’s (n/k/a Aerotek Affiliated Services, Inc.), Wells Fargo Bank & Trust

Company, Inc., Day & Zimmermann NPS, Inc., Peoples Security Bank and Trust

Company (f/k/s Old Forge Bank) and Fidelity Deposit & Discount Bank (s/h/a Fidelity

Further, if the document had been timely filed, Defendant's allegations lack the specificity required by

Goney. Therefore, Defendant is not entitled to de novo review of any portion of the R&R.

Bank, Dunmore, PA) and Mary Blasi contained in Third-Party Plaintiff's third-party

complaints (Docs. 25-32) are DISMISSED WITH PREJUDICE.2

7. Claims against remaining Third-Party Defendant James Smith are DISMISSED

WITH PREJUDICE.

2 Magistrate Judge Carlson's conclusions that the third-party complaints should be dismissed

because they violate Federal Rule of Civil Procedure 14 (failure to state a directly derivative claim) and

Third-Party Defendants cannot be held liable for complying with a tax-levy (Doc. 77 at 11, 14-16) indicate

that leave to amend would be futile. See, e.g., Phillips v. Allegheny, 515 F.3d 224, 236 (3d Cir. 2008).

Plaintiff's eight third-party complaints appear to be identical filings with different docket entry descriptions

entered by Defendant. (See Docs. 25-32.)

3 Smith, whom Defendant identifies as an IRS agent (see, e.g., Doc. 25 at 5), did not move for

dismissal, and there has been no entry of appearance on his behalf. A district court “may on its own

initiative enter an order dismissing an action provided that the complaint affords sufficient basis for the

court's action.” Bryson v. Brand Insulations, Inc., 621 F.2d 556, 559 (3d Cir. 1980). Sua sponte dismissal

generally requires giving the plaintiff an opportunity to respond. Huber v. Taylor, 532 F.3d 237, 249 (3d Cir.

2008). However,

[in narrow circumstances, courts have upheld a district court's authority to sua sponte

dismiss a complaint against a non-moving defendant where it is clear the plaintiff cannot

succeed, if the plaintiff has notice and an opportunity to respond to the moving defendant's

relevant arguments. See Martinez-Rivera v. Sanchez Ramos, 498 F.3d 3, 7 (1st Cir. 2007)

(describing limited circumstances in which sua sponte dismissals under Rule 12(b)(6) are

appropriate); Acequia, Inc. v. Prudential Ins. Co. of Am., 226 F.3d 798, 807 (7th Cir. 2000)

(stating “where one defendant succeeds in winning summary judgment on a ground common

to several defendants, the district court may also grant judgment to the non-moving

defendants, if the plaintiff had an adequate opportunity to argue in opposition”); see also

Wachtler v. Cnty. of Herkimer, 35 F.3d 77, 82 (2d Cir.1994); Bonny v. Soc'y of Lloyd's, 3

F.3d 156, 162 (7th Cir. 1993); cf. Oatess v. Sobolevitch, 914 F.2d 428, 430 n.5 (3d Cir. 1990)

(noting, in a different context, that a district court may sua sponte raise the deficiency of a

complaint so long as the plaintiff is given an opportunity to respond). Here, the non-moving

defendants were represented. by the same counsel as tie moving defendarit and are

participating in this appeal. Chen had notice and an opportunity to respond to the motion to

dismiss. We will affirm the District Court's dismissal of the individual defendants under the

particular circumstances of this case.

Chen v. KPMG LLP, No. 21-1202, 2021 WL 4520645, at *3 (3d Cir. Oct. 4, 2021), cert. denied, 214 L. Ed.

2d 170, 143 S. Ct. 352 (2022).

8. Defendant's Third-party complaints (Docs. 25-32) are DISMISSED WITH

PREJUDICE.‘

9. The Clerk of Court is directed to CLOSE THIS CASE.

UMMM

/ Robert D. Mariani

United States District Judge

Here, Third-Party Plaintiff had notice and an opportunity to respond to the moving Third-Party

Defendants’ motions and he had notice and an opportunity to respond to the R&R recommending dismissal

of the motions. Third-Party Plaintiff Kistler did not meaningfully respond to Magistrate Judge Carlson's

R&R regarding dismissal of the moving Third-Party Defendants on grounds equally applicable to Third-

Party Defendant Smith, specifically the failure of the third-party complaints to advance a directly derivative

claim in violation of Rule 14 of the Federal Rules of Civil Procedure (Doc. 77 at 11). Because the third-

party complaints do not identify a derivative claim against Smith necessary to sustain an action pursuant to

Federal Rule of Civil Procedure 14, dismissal of all claims against him is appropriate. See, e.g., FD.I.C. v.

Bathgate, 27 F.3d 850, 873 (3d Cir. 1994); see also Simonson v. Borough of Taylor, Civ. A. No. 18-CV-

2445, 2019 WL 6715789, at *4-5 (M.D. Pa. Dec. 10, 2019) (collecting cases); R&R, Doc. 77 at 9-10.

Further, specific to Third-Party Defendant Smith, the Third Circuit Court of Appeals has observed that

“Congress has expressly invoked sovereign immunity with respect to virtually all tax assessment

challenges and demands for declaratory and injunctive relief under the [Internal Revenue Code], except in

narrow situations,” United States v. Stuler, 396 F. App'x 798, 800 (3d Cir. 2010), thereby barring claims

against IRS agents for filing notices of tax liens, United States v. Beeman, Civ. A. No. 1:10-CV-237, 2011

WL 2601959, at *16 (W.D. Pa. June 30, 2011). Because Third-Party Plaintiff had notice and an opportunity

to respond to the impropriety of his third-party complaints pursuant to Rule 14 and it is clear that Third-

Party Plaintiff cannot succeed against Third-Party Defendant Smith, claims against him are appropriately

dismissed at this juncture.

To the extent Third-Party Plaintiff intended Cathy Tompson, whom he identifies as an

“EAS|/Aerotek” employee who works in the payroll office (Doc. 25 at 5), to be an individual third-party

defendant, his allegations indicate that she was acting within the scope of her employment (see id.), and

the opinion with respect to her employer (see supra {| 2) applies to her.

4 See n.2.