The opinion of the court was delivered by: BAER
HAROLD BAER, JR., District Judge:
Defendant, United States of America, has moved for summary judgment dismissing plaintiff's complaint and in favor of its counterclaim. For the reasons that follow, defendant's motion is GRANTED.
This case involves employment withholding taxes owed by a company known as Cafe Society, Inc. Cafe Society was formed to operate a restaurant and cabaret located at 915 Broadway in New York City. Plaintiff, James O'Callaghan, first invested in Cafe Society in October 1986 when he purchased 100 shares for a 2.7% ownership stake. In April 1987, plaintiff became president of Cafe Society. In November 1987, he began to increase his investment. His investment ultimately totaled $ 1.5 million such that he owned 41% of the company.
Plaintiff apparently had no responsibility for the day-to-day management of Cafe Society. All of this was handled by Dellaman and Cafe Society's employees hired by Dellaman. With the exception of three checks written in 1987, plaintiff did not execute any checks drawn on Cafe Society bank accounts. O'Callaghan, however, was the sole authorized signatory on Cafe Society's primary operating account maintained at Merchants Bank. Checks issued by Cafe Society were signed using a facsimile rubber stamp of O'Callaghan's signature. In addition, in July 1987 plaintiff obtained a $ 500,000 loan on behalf of Cafe Society.
In August 1992, plaintiff learned that Cafe Society had not paid all of the employee withholding taxes that were due to the Internal Revenue Service. On August 20, 1992, Cafe Society filed for bankruptcy under Chapter 11 of the Bankruptcy Code. At this time, Cafe Society's bookkeeper, Carol Trouche, informed plaintiff that Cafe Society's tax liability was at least $ 40,000. On August 18, the IRS filed a Notice of Federal Tax Lien against Cafe Society reflecting an unpaid assessment of $ 319,279.43.
Cafe Society was closed from July 1992 to September 28, 1992, when it reopened and operated until December 31, 1992. Upon learning of the tax problem, plaintiff asked Cafe Society's bankruptcy attorney, William Kaye, to ensure that the tax liabilities were paid. Plaintiff claims that Kaye repeatedly assured him that the payments were being made.
The IRS issued a tax assessment of $ 98,363.50 against O'Callaghan on January 2, 1995 for unpaid employee tax withholdings. This assessment differs from the August 18, 1992 assessment against Cafe Society in part because a payment had been made to reduce the withholding tax liability and in part because the corporation was liable for certain taxes for which O'Callaghan was not responsible. Plaintiff paid $ 21.42 of this assessment on September 29, 1995. Subsequently he brought this action seeking a refund and a declaratory judgment and injunction to abate the IRS assessment. The United States counterclaimed seeking the unpaid taxes and interest from January 2, 1995. The defendant has now moved for summary judgment.
Summary judgment is appropriate where there are no disputed issues of material facts and the moving party is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby, Inc. 477 U.S. 242, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986); Tomka v. Seiler Corp., 66 F.3d 1295, 1313 (2nd Cir. 1995). The "party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of [the record] . . . which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Once "a properly supported motion for summary judgment is made, the adverse party 'must set forth specific facts showing that there is genuine issue for trial.'" Anderson, 477 U.S. at 250. In determining whether there is a genuine issue of material fact, the court must resolve all ambiguities and draw all factual inferences in favor of the non-moving party. Tomka, 66 F.3d at 1304.