United States District Court, S.D. New York
OPINION AND ORDER
GABRIEL W. GORENSTEIN United States Magistrate Judge.
the United States of America (the “Government”)
has moved for summary judgment in this case, which seeks to
reduce tax assessments against the defendant taxpayers to
judgment. For the following reasons, the
Government's motion for summary judgment is granted.
The Claims in this Case
case was brought by the Government, on behalf of the Internal
Revenue Service (“IRS”), against defendants to
obtain a judgment for outstanding federal tax liabilities -
initially, for tax years 2002 through 2008. Complaint, filed
Feb. 10, 2014 (Docket # 2) (“Compl.”),
¶¶ 1, 7-19. Since filing the complaint, however,
defendants “fully paid tax years 2002, 2007, and
2008.” Gov't Mem. at 1 n.2. Thus, the only tax
years at issue are 2003, 2004, 2005, and 2006, for which the
Government is seeking a total of $122, 072.59 in unpaid
taxes, penalties and interest as of September 1, 2016.
Id. at 1 nn.1-2; accord Account Transcripts
(attached to Sun Decl. as Ex. A) (“Transcripts”),
at 0750, 0758, 0766, 0772. The Government notes that interest will
continue to accrue and that “statutory additions”
may also become due before the date judgment is entered.
See Gov't Mem. at 1 n.1. Thus, the Government
asks that its motion “be understood to incorporate a
request for [any] additional interest as well as for
statutory additions that will have accrued” through the
date of judgment. Id.
Defendants' Failure to Respond Properly to the
Government's Statement Under Local Civil Rule 56.1
Local Civil Rule 56.1, a summary judgment movant is required
to file a “concise statement, in numbered paragraphs,
of the material facts as to which the moving party contends
there is no genuine issue to be tried.” Local Civ. R.
56.1(a). The responding party must “include a
correspondingly numbered paragraph responding to each
numbered paragraph in the statement of the moving
party.” Local Civ. R. 56.1(b). Both the movant and
opposing party must cite to admissible evidence to support
each of their statements of material fact. Local Civ. R.
56.1(d). Under Local Civ. R. 56.1(c), “[e]ach numbered
paragraph in the statement of material facts . . . will be
deemed to be admitted for purposes of the motion unless
specifically controverted by a correspondingly numbered
paragraph in the statement required to be served by the
opposing party.” Accord Giannullo v. City of New
York, 322 F.3d 139, 140 (2d Cir. 2003).
the Government submitted a statement under Local Civil Rule
56.1 that contained 95 numbered paragraphs. See
Gov't Statement. While defendants filed a
counterstatement that denied the truth of a number of those
paragraphs, see Defs. Statement, defendants'
counterstatement cites to no admissible evidence. Indeed,
defendants provide no citations to evidence at
Thus, Local Civ. R. 56.1(c) dictates that all of the
Government's statement be deemed admitted.
court is expected to give special consideration to pro se
litigants, that doctrine does not apply here because Wales -
as he himself has pointed out, see, e.g.,
Defs. Statement ¶¶ 111-116 - is an experienced
attorney. See, e.g., Harbulak v. County
of Suffolk, 654 F.2d 194, 198 (2d Cir. 1981) (lawyer
proceeding pro se “cannot claim the special
consideration which the courts customarily grant to pro se
parties”) (citation omitted); accord Cayo v.
Sefceik, 2014 WL 5038056, at *3 (D. Conn. Oct. 8, 2014);
Corsini v. Bloomberg, 2014 WL 2029178, at *14
(S.D.N.Y. May 15, 2014); see also Smith v. Plati,
258 F.3d 1167, 1174 (10th Cir. 2001) (declining to construe
pleading liberally because litigant was licensed attorney);
Olivares v. Martin, 555 F.2d 1192, 1194 n.1 (5th
Cir. 1977) (plaintiff would not be “accord[ed] . . .
the advantage of the liberal construction of his complaint
normally given pro se litigants because he is a licensed
attorney”) (citation omitted). In fact, Mr. Wales
claims expertise specifically in federal litigation.
See Defs. Statement ¶ 113 (noting his
chairmanship of the “Federal Court Committee” at
the New York County Lawyers' Association).
application of Local Civil Rule 56.1(c) by itself would
require the granting of the Government's motion inasmuch
as all the facts necessary for it to prevail are contained in
its Rule 56.1 Statement. Nonetheless, a district court
“has broad discretion to determine whether to overlook
a party's failure to comply with local rules.”
Holtz v. Rockefeller & Co., 258 F.3d 62, 73 (2d
Cir. 2001) (citations omitted). We will exercise our
discretion here to examine the admissible evidence that
defendants have submitted notwithstanding their failure to
comply with Local Rule 56.1 because doing so has no effect on
the outcome of the Government's motion.
Facts Defendants Do Not Purport to Dispute
2003, 2004, 2005, and 2006, the defendants timely filed their
tax returns. Gov't Statement ¶¶ 22, 37, 47, 57;
Defs. Statement ¶¶ 22, 37, 47, 57. At the time they
filed their returns, however, they failed to pay the taxes
they owed for any of these years. For tax year 2003, the IRS
assessed $17, 551.00 in taxes due. Gov't Statement ¶
23; Defs. Statement ¶ 23. For tax year 2004, the IRS
assessed $29, 476.41. Gov't Statement ¶ 38; Defs.
Statement ¶ 38. For tax year 2005, the IRS assessed $14,
994.52 and defendants claimed $3, 590.00 in withholding
credit. Gov't Statement ¶¶ 48, 49; Defs.
Statement ¶¶ 48, 49. For tax year 2006, the IRS
assessed $14, 708.97 and defendants claimed $3, 500.00 in
withholding credit. Gov't Statement ¶¶ 58, 59;
Defs. Statement ¶¶ 58, 59.
do not even purport to contest any of these assessments.
Instead, the issue in this case centers on what payments
defendants made toward their tax liabilities for these four
tax years. Apart from defendants's admission they
“made a payment of $317.33 towards their 2006
taxes” on December 4, 2014, see Gov't
Statement ¶ 63; Defs. Statement ¶ 63, the parties
dispute what payments were made.
IRS Tax Records
all the evidence offered by the Government regarding
defendants' payments is derived from IRS “tax
transcripts, ” which are described in detail by IRS
Revenue Officer Karen Sun. See generally Sun Decl.;
Sun Suppl. Decl. Copies of the defendants' transcripts
are attached to Sun's declarations.
worked for the IRS as a Revenue Officer for 26 years. Sun
Decl. ¶ 1. Sun described her familiarity and experience
working with the IRS's Integrated Data Retrieval System
(“IDRS”) - the system that generates the tax
transcripts - as well as her work on defendants' own
account since May 12, 2012. Id. ¶¶ 1-2.
The IDRS is the basis by which the IRS maintains account
information for taxpayers for each taxable year. Id.
¶ 3. For these accounts, the IRS contemporaneously notes
any transactions, payments, communications, and any other
occurrence with taxpayers in the IDRS, with each occurrence
type identified by a numeric code. Id. ¶¶
2, 4-6, 10. These entries cannot be backdated. Id.
¶ 7. Information in the IDRS may be retrieved in the
form of a “literal transcript” which shows
occurrence codes and a description of each occurrence, as
well as a “‘certified transcript' (also known
as a ‘Form 4340'), which omits the transaction code
information.” Id. ¶ 8. Sun attached to
her declaration copies of literal and certified transcripts
from the defendants' tax accounts for tax years 2003,
2004, 2005, and 2006. Sun Decl. ¶ 16 n.1; Transcripts.
year 2003, the IRS assessed $17, 551.00 against defendants on
May 31, 2004. Sun Decl. ¶ 19; Transcripts at 0742.
Defendants claimed $1, 440.00 in withholding credits, but the
IRS later reduced that amount to $86.00 after determining
that the defendants overstated their withholdings. Sun Decl.
¶ 20 & n.2; Transcripts at 0742, 0744. Thus, the
effective amount owed on the initial IRS assessment was $17,
465.00. Over the next 12 years, the IRS assessed an
additional $11, 857.69 in penalties, interest, and costs,
while the defendants made a total of $6, 879.65 in subsequent
payments, for a net increase of $4, 978.04 in the amount due.
See Transcripts at 0742-49; Sun Decl. ¶¶
19-30. This lead to an outstanding balance of $22, 443.04 as
of September 1, 2016. Transcripts at 0750; accord
Sun Decl. ¶ 30.
year 2004, the IRS assessed $29, 476.41 against defendants on
May 30, 2005. Sun Decl. ¶ 33; Transcripts at 0752.
Defendants claimed $300.00 in withholding and paid $4, 000.00
in estimated taxes, Sun Decl. ¶ 34; Transcripts at 0752,
for a starting assessment balance of $25, 176.41. Sun Decl
¶ 37. Over the next 11 years, defendants made no
additional payments to this account and the IRS imposed
penalties and interest totaling an additional $20, 782.30.
Transcripts at 0752-58; Sun Decl. ¶ 34-39. This lead to
an outstanding balance of $45, 958.71 as of September 1,
2016. See Transcripts at 0758; Sun Decl. ¶ 40.
year 2005, the IRS assessed $14, 994.52 on June 12, 2006, and
the defendants claimed $3, 590.00 in withholding credit, Sun
Decl. ¶¶ 43-44; Transcripts at 0760, for an initial
balance of $11, 404.52, see Sun Decl. ¶ 47.
Over the next 10 years, defendants made no payments toward
this account and the IRS imposed penalties and interest on
the original balance, totaling $8, 786.93. Transcripts at
0760-66; Sun Decl. ¶ 46, 48-49. The ...