Petition for Writ of Certiorari — Romano v. United States
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92-32 | S Mupreme Court, U.S.
FILED
No. JUL 8 1992
a
QFARQE OF THE Clan
SS ———-
IN THE
Supreme Court of the United States
October Term, 1992
UNITED STATES OF AMERICA,
Respondent,
-against-
BENEDETTO ROMANO,
Petitioner.
PETITION FOR WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
MURRAY APPLEMAN
Attorney for Petitioner
A Member of the Bar of the
United States Supreme Court
225 Broadway—39th Floor
New York, New York 10007
(212) 349-6966
Dick Bailey Appellate Printers > Tel.: 1-800-564-4918 <
(212) 608-7666 — (718) 447-5358 — (S16) 222-2470 — (914) 682-0848
Fax Number: (718) 273-8031
QUESTION PRESENTED
Whether the United States District Court has jurisdic-
tion pursuant to Section 7402(a) of the Internal Revenue
Code and 28 U.S. Code Sections 1340 and 1345 to reduce
termination tax assessments (685], 1.R.C.) to judgment
subject to modification pursuant to Section 7403 of the
I.R.C. (26 U.S.C.) subsequent to petition filed in United
States Tax Court when 26 U.S.C. Section 7422(e) man-
dates that once a petition is filed in Tax Court, ‘‘The
district court and the court of claims as the case may be
should lose jurisdiction.’”’
LIST OF PARTIES
BENEDETTO ROMANO, defendant in the United
States District Court appealed to the Second Circuit Court
of Appeals.
il
TABLE OF CONTENTS
Page
QwettIONS PORREOE occccsccnccavcthcdcienscderavmnenenbaneceassas i
TRO POMUIEE ncccacccacndcencneccesssncctscsesacasinscbaass vessels i
The Opinion of the Court Below ...............cceceseeeeeeeees ‘i
FUTIBGICTIOR .osccennss0cticecendsntemnseeeewansensseabeunesatanensceus 2
The Principal Constitutional and Statutory
PTOVISIORS TRVOIVIE 6 cscsdccnccenctciniecnrsersmentianiaseisiate 2
StRtCERt GE CO COBDS oss cncccanchennavsuausauceipeneicntencececcs 2
Reasons for Granting the Petition .............sssssssssseesees 2
POINT—Once a petition is filed in the United States
Tax Court, sole jurisdiction rests therein in accor-
dance with Congressional intent and the Internal
Rewemwe COGS .ascocvacccaccecssusecnaebaGeeenaae ces 3
CORCIREIOR ocsccnsscecewecnenscnsugeeacuaeseienaeees anal 1]
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CASES CITED
Cases Pages
Akron v. Akron Center for Reproductive Health ~
a Se Mata i, CUP URE Bineanecicnsenenneesccccnsnasccensss 10
pener v. U.2., DA.-02. OFC. SIG F. SUDD. 4D oc ncccsccscces 9
Burnett v. Coronado Oil & Gas Co., 285 U.S. 395,
405 (1932) (Brandeis, J., Dissenting)......................06. 10
Dorl v. Comm., 507 F.2d 406 (2d Cir., 1974)................ Y
Elbert v. Johnson, 164 F.2d 421, 424 (2d Cir. 1947)........ Q
Care B.C. GES U.S. BGT CIS TS) a occsnsis vee cccessdy 349,09
Patterson v. McLean Credit Union, 491 U.S. 164, 172
Teen ecu gugk eta cwanheudsaseedunss 10
Perlowin vy. Michael D. Sassi, cf., (DC-Calif., 83
1USTC 9417) (Ca-9, 1983) 711 F.2d 910...................... 8
Ercues We GOOD, Boe © ePID. OE FO occ cscesescncssccnsccccsess 4
U.S. v. LeRoy Doyle (DC-ED Wisc) 494 F. Supp.
DeLee A eel UL GC ocad scchnbireankehuhecachibcevewedienidnn 8
U.S. v. Joe Graham Post No. 119 Am. Legion, 340
F.2d 474 (Sth Cir. 1965) cert den 382 U.S. 824 .............. 9
U.S. v. Stonehill, 702 F. 2d 1288, 1292 (9th Cir. 1983).....9
U.S. v. Wolf, 238 F.2d 447, 449 (9th Cir. 1956)............. 9
Yannicelli v. Nash, 354 F. Supp. 143 (N.J. 1973)........... 9
iV
I.R.C. Sections
GUE cicacannchtndencnksvadenndsdebanaialauanansnccakenieaeens 2,3
OE. sinkakanewicecauces sbuinhyekeaseaneenbundaaneeanesceuekbaene 2
DUET ‘skkucakedennatuccencincovestansennnanetoncseaeauiatinecosnens 2
GRE knitenanieinssctdenbineshauseeakaanedaiaen ae 2,7,8
PREGA devon suownudancsscniapiaccceubestastnedsentestekpatadonmenie 2
PO iddewevcuvnnvnosasuctocsccnakaunsucsisnaniidsseaneneeseuadelaes 2
PU ANis bic kebandosnvapanwiadasbedasininteduemdcasametncbeonbenors 2
Be Sock Ee BE BEE Snnawukacdeiavudkucetieetedaccneensees i
]
IN THE
Supreme Court of the Wnited States
October Term, 1992
UNITED STATES OF AMERICA,
Respondent,
.-against-
BENEDETTO ROMANO,
Petitioner.
PETITION FOR WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
Petitioner, BENEDETTO ROMANO prays that a
writ of certiorari issue to review a final judgment and
order of the United States Court of Appeals for the Se-
cond Circuit decided April 8, 1992 and amended May 6,
1992 (Appendix A) infra which affirmed the judgment of
the United States District Court for the Eastern District of
New York (Korman, Edward R.D.J.) granting summary
judgment to the respondent.
THE OPINION OF: THE COURT BELOW
The opinions of the Court below, namely the United
States Court of Appeals for the Second Circuit affirming
the decision and judgment are set forth in Appendix A, in-
fra as aforesaid.
2
JURISDICTION
The orders of the judgment of the United States
Court of Appeals for the Second Circuit, the Court below
are dated April 8 and May 6, 1992. Jurisdiction of this
Court is invoked, made and conferred under 28 U.S.C. §
1254(1).
THE PRINCIPAL CONSTITUTIONAL AND
STATUTORY PROVISIONS INVOLVED
Internal Revenue Code Sections 6851, 6861,
6863/7422 and 7429
STATEMENT OF THE CASE
The facts are not in dispute. Solely due to Federal
Custom Agents seizing $359,500 in cash BENEDETTO
ROMANO was carrying in his automobile when he at-
tempted to enter Canada from Buffalo, New York, the In-
ternal Revenue Service made a deficiency determination
pursuant to Code Section 6851(a), which provided for ter-
mination of the tax year and immediate determination of
the tax due. Following the procedures mandated by Con-
gress and the Supreme Court decision in Laing, 423 U.S.
161 (1976) a 90 day letter was subsequently issued and a
petition was timely filed in the United States Tax Court,
Docket No. 621-85 still pending.
REASON FOR GRANTING THE PETITION
1. The lower Court’s decision is ill conceived, con-
troverts Congressional intent and is contrary to Supreme
Court precedent.
3
2. Conflict in the Court exist and this decision renders
jurisdiction of the United States Tax Court a nullity upon
the whims of the United States.
WHETHER JURISDICTION OF THE UNITED
STATES TAX COURT MAY BE SUBJECTED TO
WHIMS OF THE UNITED STATES GOVERNMENT
AND UNITED STATES DISTRICT COURT IN
CONTRAVENTION OF THE INTERNAL REVENUE
CODE AND LIMITATIONS PLACED ON UNITED
STATES DISTRICT COURT JURISDICTION
PURSUANT TO CODE SECTION 6851, 6512,
PLUS 7422 AND CONGRESSIONAL TEACHINGS
The Supreme Court in Laing, 96 S. CT. 473, 423 U.S.
16], set the foundation for the procedures involved with
regard to a termination and jeopardy assessment and trig-
gered Congressional action. The tax owing but not
reported, at a time of a jeopardy termination of a tax year
under Code Section 6851 is a deficiency, whose assessment
and collection is subject to the procedural requirements of
Code Section 6861. As a result the Internal Revenue Ser-
vice must mail a deficiency notice to the taxpayer within 60
days after the jeopardy assessment.
Termination assessments are made when it appears to
the Internal Revenue Service that the collection of income
tax for the current tax year or the immediate preceding
year will be jeopardized by certain acts of a taxpayer.
Regs. 1.6851-1(a)(1).
If the District Director decides that a termination
assessment for a current year is to be made, the taxpayer is
assessed an income tax liability that is based on the tax-
payer’s taxable income for a period that begins on the Ist
4
day of the tax year and ends on the day of assessment. A
termination assessment thus does not end the taxable year
for any purpose other than the computation of tax that
becomes due and payable by reason of the termination
assessment. The termination assessment of tax, thus, has
an effect similar to the collection of estimated taxes. Code
Section 6851 (a)(1)(2) and (3).
Prior to the Tax Reform Act of 1976, there was no
immediate avenue for judicial review of these extraor-
dinary’ assessments. The taxpayer was relegated to the post
collection-remedy of a suit for a tax refund. The 1976 act,
however provided for both administrative and judicial
review of this type of assessment. 26 U.S.C. §7429.
The District Court’s task under §7429 is limited to
evaluating the reasonableness of the Internal Revenue Ser-
vice assessment. The taxpayer’s ultimate tax liability is not
at issue.
The holding below is inconsistent with this court’s
decision in Laing, supra, and conflicts with decisions of
other Federal Courts. Court decisions have been consis-
tent with basis that once United States Tax Court has
jurisdiction, transfer to another Court can possibly be bas-
ed solely on consent of both parties examining Congres-
sional intent as inferred through the applicable statutes.
The judiciary has a role as a neutral ‘“‘checkpoint be-
tween the government and the citizen.’’ But once in United
States Tax Court, the United States District Court has no
authority to overrule the former’s jurisdiction. This is an
infringement of the United States Tax Court’s jurisdiction
and responsibilities.
This Court held in Laing, supra, that within 60 days
after a termination assessment, the Service should have
sent deficiency notices to the petitioner despite the absence
of an explicit requirement to that effect in the termination
assessment statute. In so ruling the Court was particularly
concerned that individuals subjected to the extraordinary
remedy of termination assessment be afforded the oppor-
tunity to obtain a redetermination of the deficiency in the
Tax Court. The Court noted:
Denial of an opportunity to litigate in the Tax Court
is out of keeping with the thrust of the Code, which
generally allows income-tax pzyers access to that
Court. Where exceptions are intended, the Code is ex-
plicit on the matter. See e.g. § 6871 (b). Denying a
Tax Court forum to a particular class of taxpayers is
sufficiently anomalous that an intention to do so
should not be imputed to Congress when the statute
does not expressly so provide.
Laing v U.S., supra, 423 U.S. at 176.
After Laing, Congress amended the termination pro-
vision, adding section 6851 (b), which requires that defi-
ciency notices be sent to taxpayers who have been sub-
jected to termination assessments. However, Congress did
not adopt the 60 day rule articulated in Laing. Instead it
provided that the Service could wait until the terminated
year actually ended. Then, the Service would be required
to send the taxpayer a deficiency notice within 60 days
after the later of the due date of the tax return or the ac-
tual filing date of the return as noted. This framework
does enable the taxpayer to challenge the termination
assessment in the Tax Court, but requires the taxpayer to
wait until the terminated year has come to a natural close.
6
Even though Congress chose a procedure for sending
notices of deficiency that differs slightly from the pro-
cedure articulated in Laing, it is clear that in adding the
deficiency notice provision to the termination assessment
Statute, Congress was motivated by the same concerns
which had prompted the Supreme Court to import the
jeopardy termination safeguards into the termination
assessment context. Congress was trying to assure that
redetermination in the Tax Court would ultimately be
avaliable to the taxpayer subjected to termination assess-
ment. As was noted in the General Explanation of the Tax
Reform Act of 1976 by the Staff of the Joint Committee
on Taxation
Congress believes it appropriate to allow a taxpayer
who has been subjected to a termination assessment
to contest the ultimate issue of his tax liability in the
Tax Court in the same manner as is provided with
respect to a taxpayer who has been subjected to a
jeopardy assessment. Consequently, the Act provides
that within 60 davs after the later of the due date of
the taxpayer’s return for the full taxable year or the
date on which the return is actually filed, the Service
must send the taxpayer a notice of deficiency.
H.R. No. 10612, 94th Cong, 2d Sess. 363(1976)
Congress chose not to use the 60 day rule set forth in
Laing because in addition to providing year-end ac-
cess to the Tax Court for taxpayers subjected to ter-
mination assessment, Congress also amended the In-
ternal Revenue Code to provide an expedited mid-
year administrative and judicial review. Congress
determined that this review would constitute an ade-
quate mid-year procedural safeguard, while
eliminating the technical difficulties involved in a full
mid-year redetermination by the Tax Court. See H.R.
Rep. No. 10612, 94th Cong, 2d Sess. 363 (1976)
Thus pursuant to 26 U.S.C. § 7429, within 30 days of
receipt from the Service of a written statement of the
information on which it relied in making its termina-
tion assessment a taxpayer may now request the Ser-
vice to review the assessment. The Service determines
whether the termination assessment was reasonable
under the circumstances and whether the amount
demanded was appropriate. The Service notifies the
taxpayer of its decision. The taxpayer may then bring
a civil action in district court. The district court’s
review, like that of the Service, is limited to a deter-
mination whether the assessment was reasonable
under the circumstances and whether the amount
demanded was appropriate.
Petitioner did not take advantage of these expedited
mid-year review procedures, although he could have
done so without a notice of deficiency. Evidently, his
failure to take advantage of these optional remedies
does not affect his right to receive a notice of deficien-
cy and file a petition for redetermination in the Tax
Court. The mid-year proceedings would have resulted
in only a determination as to the ‘‘reasonableness’”’
and ‘‘appropriatencee’’ of the assessment. This
would not have given him the full relief he would be
entitled to in the Tax Court- a redetermination of the
amount of the deficiency. In discussing the mid-year
review mechanisms, Congress acknowledged that
they were not intended to serve as a substitute for a
full determination in the Tax Court.
In determining whether the amount assessed is ap-
propriate under the circumstances, the Court is not
it
8
expected to attempt to determine ultimate tax liabili-
ty. Rather, the issue to be determined is whether, bas-
ed on the information then available, the amount of
the assessment is reasonable. Thus, for example, in
the absence of other evidence made available to the
Internal Revenue before the proceeding or during the
proceeding, an assessment of an estimate of the tax-
payer’s liability to date based on information in fact
available to the Internal Revenue Service will be
presumed to be reasonable.
A determination made under section 7429 will have
no effect upon the determination of the correct tax
liability in a subsequent proceeding. The proceeding
under the new provision is to be a separate proceeding
which is unrelated, substantively and procedurally, to
any subsequent proceeding to determine the correct
tax liability, either by action for refund in a Federal
district court or in the Court of Claims or by a pro-
ceeding in the Tax Court. H.R. Rep. No. 10612, 94th
Cong., 2d Sess 362(1976)
See/cf. Perlowin v. Michael D. Sassi, (D.C. Calif) 83-1
U.S.T.C. 9417 and C.A.-9 1983, 711 F.2d. 910.
As was pointedly revealed in U.S.A. v. LeRoy Doyle,
(DC-ED Wisc) 494 F. Supp. 1041
The summary proceeding under § 7429 is to be a
separate proceeding which is unrelated substantively
and procedurally to any subsequent proceeding to
determine the correct tax liability either by action for
refund in a Federal taxpayer’s District Court or in the
Court of Claims or by a proceeding in the Tax Court.
S. Rep. No. 94-938 (part I), 94th Cong,2d Sess 365
reprinted in (1976) U.S. Code & Adm. News 3429,
3795.
9
The District Court has no jurisdiction to hear a case
when a petition has been filed in Tax Court. Baker v.
U.S., DC-D of C, 518 F.Supp. 45. citing Dorl v. Comm,
507 F.2d 406 (2d Cir, 1974) citing U.S. v. Wolf, 238 F.2d
447,449 (9th Cir 1956) and Elbert v. Johnson, 164 F.2d
421,424 (2d Cir. 1947). See also U.S. v. Joe Graham Post
No. 119 Am. Legion, 340 F.2d 474 (Sth Cir 1965) cert.
den. 382 U.S. 824. Yannicelli v. Nash, 354 F. Supp. 143
(N.J. 1973).
Thus it is a remarkable conclusion by the Second Cir-
cuit with regard to a case having to do with a foreclosure
of a tax lien, U.S. v. Stonehill, 702 F.2d 1288, 1292 (9th
Cir 1983) that it had jurisdiction. Had Congress intended
for the District Court to have jurisdiction solely based on
Termination Assessment it would have done so expressly
without requiring a notice of deficiency within 60 days.
The government subsequent to the decision rendered
by the Second Circuit Court of Appeals on April 8, 1992
made a motion to correct the opinion specifically objec-
ting to the Court’s stating ‘‘Since any final judgment ob-
tained in this case is subject to a refund if the Tax Court
determines there has been an overassessment, the District
Court did not have to decline jurisdiction, Clinton, 232 F.
Supp. at 958 and we find no abuse of discretion.”’
Moreover, taking exception to ‘‘the proceeding in the
Tax Court is still pending, so the final assessment has not
yet been determined.’”’
It was then requested that in contravention of Code
Sction 7429, Congressional intent and this Court’s deci-
sion in Laing, supra, that the Court ‘‘correct its opinion to
reflect that the termination assessment made against the
taxpayer has been determined on the merits and that tax-
payer may not relitigate his liability for these taxes in his
10
Tax Court proceeding pointedly revealing that ‘‘a suit to
reduce an assessment to judgment is a proceeding on the
merits of the tax assessment; it determines the taxpayer’s
tax liability and is res judicata in any future proceedings.”’
This determination based on Laing and Congressional in-
tent should be in the United States Tax Court.
STARE DECISIS
The overruling of Congressional intent and Court
precedents ought to be a matter of great moment and con-
sequence. Although the doctrine of stare decisis is not an
‘‘inexorable command’’, Burnet v. Coronado Oil & Gas
Co., 285 U.S. 395, 405 (1932) (Brandeis J. dissenting), the
Supreme Court has repeatedly stressed that fidelity to
precedent is fundamental to a ‘“‘society governed by the
rule of law’’. Akron v. Akron Center for Reproductive
Healty, Inc., 462 U.S. 416,420 (1983). See generally Par-
terson v. McLean Credit Union, 491 U.S. 164,172(1989).
It is indisputable that stare decisis is a basic self governing
principle within the judicial branch, which is entrusted
with the sensitive and difficult task of fashioning and
preserving a jurisprecedential system that is not based:
upon an arbitrary discretion.
The Second Circuit cannot seriously claim that any
legal basis exists for removing jurisdiction from the Tax
Court which this decision accomplishes.
nee ae
)]
CONCLUSION
The petition for a writ of certiorari should be granted.
Respectfully submitted,
MURRAY APPLEMAN
Attorney for Petitioner
A Member of the Bar of the
United States Supreme Court
225 Broadway—39th Floor
New York, New York 10007
(212) 349-6966
la
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
UNITED STATES OF AMERICA,
Plaintiff,
V.
BENEDETTO ROMANO,
Defendant.
CV-89-3862 (ERK)
ORDER
The plaintiff United States of America, having moved
this Court for entry of summary judgment in its favor and
upon a review of all the papers submitted in this manner
and oral argument having been had thereon it is hereby
ORDERED AND ADJUDGED that the plaintiff’s mo-
tion for summary judgment is granted and it is further
ORDERED AND ADJUDGED that summary judgment
is entered in favor of the United States in the amount of
$169,981.00 plus statutory interest as allowed by law.
HONORABEL EDWARD R. KORMAN
United States District Judge
2a
UNITED STATES COURT OF APPEALS FOR THE
SECOND CIRCUIT
At a stated Term of the United States Court of Ap-
peals for the Second Circuit, held at the United States
Courthouse in the City of New York, on the 9th day of
April, one thousand nine hundred and ninety-two.
PRESENT:
HON. ROGER J. MINER,
Circuit Judge,
HON. JOHN S. MARTIN, Jr.,
District Judge.’
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
BENEDETTO ROMANO,
Defendant-Appellant.
ORDER
91-6106
UPON CONSIDERATION of this appeal from an
order entered by the United District Court for the Eastern
District of New York (Korman, J.) it is hereby
' Hon. John S. Martin, Jr., United States District
Judge for the Southern District of New York, sitting by
disignation.
3a
ORDERED, ADJUDGED, AND DECREED that
the judgment of the said District Court be and it hereby is
affirmed. :
Defendant-appellant Benedetto Romano appeals
from an order entered in the District Court on December
19, 1990, granting in the amount of $169,981 ‘‘plus
Statutory interest as allowed by law’’ for taxes owed pur-
suant to a termination assessment issued by the Internal
Revenue Service (‘‘IRS’’), 26 U.S.C. § 6851, for tax year
1983.
In Novemer 1983, Romano and his wife attempted to
cross into Canada via the Peace Bridge near Buffalo, New
York. A Canadian customs agent stopped their car on the
Canadian side and requested permission to search the
trunk. Romano agreed, and the agent discovered several
bags containing U.S. currency inside. The agent then con-
tacted the U.S. Customs Service on the other side of the
bridge. The U.S. agents requested that the Romanos be
returned to the United States, and the Canadian agent sent
them back across the bridge.
On the American side, U.S. Customs agents question-
ed Romano, who eventually admitted that the bags con-
tained over $300,000 in cash. Romano filled out the ap-
propriate forms to declare this amount, and the agents
seized the money ($359,500) pursuant to 31 U.S.C. §
5317(c) (money may be seized for failure to report its
transportation outside the United States). The IRS was in-
formed of the seizure, and, based on the cash in Romano’s
possession at the time, issued a termination assessment, 26
U.S.C. § 6851, against Romano for $169,981 as income
tax due. The termination assessment abruptly ended
Romano’s tax year and determined his tax liability for that
tax year, because he was presumed to be attempting to
hide the cash from the government’s reach. Jd. The
4a
amount of a tax liability set by a termination assessment is
due immediately. /d.
In October 1984, after Romano failed to file a tax
return for tax year 1983 (including extensions), the IRS
sent him a notice of deficiency for that year, which includ-
ed the amount calculated under the termination assess-
ment. Jd. at §§ 6212, 6851(b). Romano timely appealed
the assessed deficiency to the Tax Court. Jd. at §6213(a).
In a subsequent civil proceeding seeking forfeiture of the
cash pursuant to 31 U.S.C. §5317(b), the government
sought the entire $359,500 discovered at the border. The
district court denied the forfeiture, holding that actual
knowledge of the reporting requirement by the defendant
was necessary to sustain forfeiture under 31 U.S.C. §5317.
United States v. $359,500 in United States Currency, 645
F. Supp. 638 (W.D.N.Y. 1986), rev’d, 828 F.2d 930 (2d
Cir. 1987).
We reversed, ruling that constructive knowledge is
sufficient to support a forfeiture, and remanded for a
determination of Romano’s constructive knowledge of the
reporting requirement. United States v. $359,500 in
United States Currency, 828 F.2d 930 (2d Cir. 1987). The
district court stayed the action when Romano invoked his
Fifth Amendment right against self-incrimination, based
upon a pending criminal tax evasion indictment, when he
was asked questions about his constructive knowledge of
the requirement. In the criminal case, Romano was charg-
ed with, and convicted of, one count of tax evasion. We
overturned the conviction, United States v. Romano, 938
F.2d 1569 (2d Cir. 1991), finding that the government fail-
ed to prove that Romano affirmatively attempted to evade
taxes.
Sa
In the meantime, the government, in November 1989,
filed this suit on behalf of the IRS to reduce the deficiency
for tax year 1983 (specifically the amount in the termina-
tion assessment) to judgment. The proceeding in the Tax
court is still pending, so the final assessment has not yct
been determined. Romano argues on appeal that the
District Court lacked subject matter jurisdiction because
of the pending Tax Court proceeding. This
argument fails.
The Tax Court and the district courts have concurrent
jurisdiction to determine a taxpayer’s final deficiency. See
26 U.S.C. §§ 6213(a), 7402(a); see also 28 U.S.C. § 1340.
If he taxpayer timely petitions the Tax Court, the govern-
ment is prohibited from, among other things, commencing
any proceedings for collection of the deficiency until the
Tax Court decision becomes final. 26 U.S.C. § 6213(a).
Excluded from this prohibition, however, are proceedings
brought by the government to enforce termination
assessments under section 6851. Thus, section 6213
specifically permits the government to bring actions such
as this one. See United States v. Cinton, 232 F. Supp. 957,
958 (S.D.N.Y. 1964).
The only method by which a taxpayer may stay collec-
tion of the tax due on a termination assessment is by filing
‘*a bond in an amount equal to the amount as to which the
stay is desired.’’ 26 U.S.C. § 6863; see United States v.
O’Commor, 291 F.2d 520, 525 (2d Cir. 1961); Clinton,
232 F. Supp. at 958. Unless the taxpayer-files the bond, the
IRS may seek to collect the assessed amount by bringing a
proceeding in a district court, even during pendency of a
Tax Court action. See Clinton, 232 F. Supp. at 958. In this
case, Romano failed to file a bond. Thus, since the statute
expressly permits the government to bring this action, and
the District Court has jurisdiction to hear such cases, the
64
only issue remaining is whether the District Court should
have exercised jurisdiction under these circumstances or
deferred to the Tax Court proceeding. O’Commor, 291
F.2d at 528. Since any final judgment obtained in this case
is subject to a refund if the Tax Court determines that
there has been an overassessment, the District Court did
not have to decline jurisdiction, Clinton, 232 F. Supp. at
958, and we find no abuse of discretion.
In his conclusory opposition to summary judgment,
Romano did not ask the District Court to stay the concur-
rent Tax Court proceeding. Furthermore, Romano of-
fered no opposition to the merits of the termination assess-
ment in response to the motion. Without a reason from
Romano to Stay its hand, and in the absence of a showing
of any triable issue of fact regarding the termination
assessment itself, the District Court did not abuse its
discretion in granting summary judgment based on the
government’s submission.
Finally, Romano in his brief makes the following con-
tention: ‘‘Suppression is mandated by the Fifth Amend-
ment Due Process Constitution violation and the suppres-
sion remedy is contained within the guarantee of the Fifth
Amendment itself.’’ This sentence constitutes the sum
total of Romano’s argument on this point. Federal Rule of
Appellate Procedure 28(a)(5) states that an appellant’s
brief shall contain an argument setting forth the ‘‘conten-
tions of the appellant with respect to the issues presented,
and the reasons therefor, with citations to the authorities,
statutes and parts of the record relied on.’’ Failure to
develop an argument with some support in fact and law
results in waiver of the argument. See, e.g., United States
v. Zannino, 895 F.2d 1, 17 (ist Cir.), cert. denied, 494
U.S. 1082 (1990); Hershinow v. Bonamarte, 735 F.2d 264,
Ta
266 (7th Cir. 1984); Carducci v. Regan, 174 F.2d 171, 177
(D.C. Cir. 1983). As Romano does nothing more than
make an unsupported allegation on this issue, the argu-
ment is waived, and we need not address it.
We have considered appellant’s remaining arguments
and find them to be without merit.
HON. ROGER J. MINER,
Circuit Judge,
HON. JOHN S. MARTIN, Jr.,
District Judge.
N.B. THIS SUMMARY ORDER WILL NOT BE
PUBLISHED IN THE FEDERAL REPORTER
AND SHOULD NOT BE CITED OR OTHERWISE
RELIED UPON IN UNRELATED CASES BEFORE
THIS OR ANY OTHER COURT.
|
8a
AMENDED ORDER
UNITED STATES COURT OF APPEALS FOR THE
SECOND CIRCUIT
At a stated Term of the United States Court of Ap-
peals for the Second Circuit, held at the United States
Courthouse in the City of New York, on the 6th day of
May, one thousand nine hundred and ninety-two.
PRESENT:
HON. ROGER J. MINER,
Circuit Judge,
HON. JOHN S. MARTIN, Jr.,
District Judge. '
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
ORDER
91-6106
BENEDETTO ROMANO,
Defendant-Appellant.
' Hon. John S. Martin, Jr., United States District
Judge for the Southern District of New York, sitting by
designation.
span
9a
UPON CONSIDERATION of this appeal from an
order entered by the United States District Court for the
Eastern District of New York (Korman, J.) it is hereby
ORDERED, ADJUDGED, AND DECREED that
the judgment of the said District Court be and it hereby is
affirmed.
Defendant-appellant Benedetto Romano _ appeals
from an order entered in the District Court on December
19, 1990, granting summary judgment in favor of
plaintiff-appellee the United States in the amount of
$169,981 ‘‘plus statutory interest as allowed by law’’ for
taxes owed pursuant to a termination assessment issued by
the Internal Revenue Service (‘‘IRS’’), 26 U.S.C. § 6851,
for tax year 1983.
Romano agreed, and the agent discovered several bags
containing U.S. currency inside. The agent then contacted
the U.S. Customs Service on the other side of the bridge.
The U.S. agents requested that the Romanos be returned
to the United States, and the Canadian agent sent them
back across the bridge.
On the American side, U.S. Customs agents question-
ed Romano, who eventually admitted that the bags con-
tained over $300,000 in cash. Romano filled out the ap-
propriate forms to declare this amount, and the agents
seized the money ($359,500) pursuant to 31 U.S.C. §
5317(c) (money may be seized for failure to report its
transportation outside the United States). The IRS was in-
formed of the seizure, and, based on the cash in Romano’s
possession at the time, issued a termination assessment, 26
U.S.C. § 6851, against Romano for $169,981 as income
tax due. The termination assessment abruptly ended
Romano’s tax year and determined his tax liability for that
10a
tax year, because he was presumed to be attempting to
hide the cash from the government’s reach. /d. The
amount of a tax liability set by a termination assessment is
due imediately. /d.
In October 1984, after Romano failed to file a tax
return for tax year 1983 (including extensions), the IRS
sent him a notice of deficiency for that year, which includ-
ed the amount calculated under the termination assess-
ment. Jd. at §§ 6212, 6851(b). Romano timely appealed
the assessed deficiency to the Tax Court. /d. at § 6213(a).
In a subsequent civil proceeding seeking forfeiture of the
cash pursuant to 31 U.S.C. § 5317(b), the government
sought the entire $359,500 discovered at the border. The
district court denied the forfeiture, holding that actual
knowledge of the reporting requirement by the defendant
was necessary to sustain forfeiture under 31 U.S.C. §
5317. United States v. $359,500 in United States Currency,
545 F. Supp. 638 (W.D.N.Y. 1986), rev’d, 828 F.2d 930
(2d Cir. 1987).
We reversed, ruling that constructive knowledge is
sufficient to support a forfeiture, and remanded for a
determination of Romano’s constructive knowledge of the
reporting requirement. United States v. $359,500 in
United States Currency, 828 F.2d 930 (2d Cir. 1987). The
district court stayed the action when Romano invoked his
Fifth Amendment right against self-incrimination, based
upon a pending criminal tax evasion indictment, when he
was asked questions about his constructive knowledge of
the requirement. In the criminal case, Romano was charg-
ed with, and convicted of, one count of tax evasion. We
overturned the conviction, United States v. Romano, 938
F.2d 1569 (2d Cir. 1991), finding that the government fail-
ed to prove that Romano affirmatively attempted to evade
taxes.
lla
In the meantime, the government, in November 1989,
filed this suit on behalf of the IRS to reduce the amount in
the termination assessment to judgment. The proceeding
in the Tax Court is still pending, so the final assessment
for tax year 1983 has not yet been determined. Romano
argues on appeal that the District Court lacked subject
matter jurisdiction because of the pending Tax Court pro-
ceeding. This argument fails.
The Tax Court and the district courts have concurrent
jurisdiction to determine a taxpayer’s income tax liability.
See 26 U.S.C. § 7402(a); see also 28 U.S.C. § 1340. Section
7402 provides a broad grant of jurisdiction to district
courts ‘‘to render suct judgments and decrees as may be
necessary or appropriate for the enforcement of the inter-
nal revenue laws.’’ The government may _ initiate
thereunder an action in a district court to reduce a ter-
mination assessment to judgment. Cf. United States v.
Stonehill, 702 F.2d 1288, 1292 (9th Cir. 1983) (action
jeopardy assessments). Ordinarily, if the taxpayer timely
petitions the Tax Court, the government is prohibited
from, among other things, commencing any proceedings
for collection of the deficiency assessed until the Tax
Court decision becomes final. 26 U.S.C. § 6213(a). Ex-
cluded from this prohibition, however, are proceedings
brought by the government to enforce termination
assessments made under section 6851. Thus, section 6213
does not bar the government from bringing actions such as
ihis one. See United States v. Clinton, 232 F. Supp. 957,
958 (S.D.N.Y. 1964).
The only method by which a taxpayer may Stay collec-
tion of the tax due on a termination assessment is by filing
‘*a bond in an amount equal to the amount as to which the
stay is desired.”’ 26 U.S.C. § 6863; see United States v.
O’Connor, 291 F.2d 520, 525 (2d Cir. 1961); Clinton, 232
l2a
F. Supp. at 958. Unless the taxpayer files the bond, the
IRS may seek to collect the assessed amount by bringing a
proceeding in a district court, even during pendency of a
Tax Court action. See Clinton, 232 F. Supp. at 958. In this
case, Romano failed to file a bond. Thus, since the statute
expressly permits the government to bring this action, and
the District Court has jurisdiction to hear such cases, the
only issue remaining is whether the District Court should
have exercised jurisdiction under these circumstances or
deferred to the Tax Court proceeding. O’Connor, 291
F.2d at 528. We find no abuse of discretion in the exercise
of jurisdiction by the District Court.
In his conclusory opposition to summary judgment,
Romano did not ask the District Court to stay the concur-
rent Tax Court proceeding. Furthermore, Romano of-
fered no opposition to the termination assessment on the
merits in response to the motion. Without a reason from
Romano to Stay its hand, and in the absence of a showing
of any triable issue of fact regarding the termination
assessment itself, the District Court did not abuse its
discretion in granting summary judgment based on the
government’s submission.
Finally, Romano in his brief makes the following con-
tention: ‘‘Suppression is mandated by the Fifth Amend-
ment Due Process Constitution violation and the suppres-
sion remedy is contained within the guarantee of the Fifth
Amendment itself.’” This sentence constitutes the sum
total of Romano’s argument on this point. Federal Rule of
Appellate Procedure 28(a)(5) states that an appellant’s
brief shall contain an argument setting forth the ‘‘conten-
tions of the appellant with respect to the issues presented,
and the reasons therefor, with citations to the authorities,
Statutes and parts of the record relied on.’’ Failure to
develop an argument with some support in fact and law
l3a
results in waiver of the argument. See, e.g., United States
v. Zannino, 895 F.2d 1, 17 (1st Cir.), cert. denied, 494
U.S. 1082 (1990); Hershinow v. Bonamarte, 735 F.2d 264,
266 (7th Cir. 1984); Carducci v. Regan, 714 F.2d 171, 177
(D.C. Cir. 1983). As Romano does nothing more than
make an unsupported allegation on this issue, the argu-
ment is waived, and we need not address it.
We have considered appellant’s remaining arguments
and find them to be without merit.
HON. ROGER J. MINER,
Circuit Judge,
HON. JOHN S. MARTIN, Jr.,
District Judge.
N.B. THIS SUMMARY QRDER WILL NOT BE
PUBLISHED IN THE FEDERAL REPORTER
AND SHOULD NOT BE CITED OR OTHERWISE
RELIED UPON IN UNRELATED CASES BEFORE
THIS OR ANY OTHER COURT.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.