United States District Court, W.D. Kentucky, Louisville
CHARLES R. SIMPSON III, SENIOR JUDGE.
matter is before the court on motion of the Plaintiff, the
United States of America, for summary judgment pursuant to
Fed.R.Civ.P. 56. The Defendants, the Law Offices of
Forbush-Moss PSC (“Law Office”) and Bethanni
Forbush-Moss, did not respond to the Plaintiff's Motion
for Summary Judgement and the time for a response has
expired. Therefore, the motion is ripe for review. For the
reasons stated, the Plaintiff's motion will be
Forbush-Moss is the owner of and sole attorney at the Law
Offices of Forbush-Moss PSC in Jefferson County, Kentucky.
(DN 1, ¶ 5.) In October of 2016, the Plaintiff filed a
Complaint in this court alleging that the Defendants
repeatedly have failed to pay federal employment,
unemployment, and corporation taxes. (Id. at ¶
6.) The Complaint alleges that, as of September 12, 2016, the
Defendants were indebted to the United States in the total
amount of $136, 951.95, inclusive of interest and penalties
accrued as of that date. (Id. at ¶ 10.) The
United States seeks an injunction compelling the
Defendants' compliance with the federal tax laws at
moving for summary judgment must show that “there is no
genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a). The moving party bears the burden of demonstrating the
absence of a genuine issue of material fact. Celotex
Corp. v. Catrett, 477 U.S. 317, 323 (1986).
Additionally, the Court must draw all factual inferences in
favor of the nonmoving party. Matsushita Elec. Indus.
Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587
(1986). A genuine issue for trial exists when “there is
sufficient evidence favoring the nonmoving party for a jury
to return a verdict for that party.” Anderson v.
Liberty Lobby, 477 U.S. 242, 249 (1986). It is the
burden of the nonmoving party to “direct the
court's attention to those specific portions of the
record upon which it seeks to rely to create a genuine issue
of material fact.” In re Morris, 260 F.3d 654,
655 (6th Cir. 2001).
Defendants are obligated to comply with certain federal tax
laws. The Law Office must file with the Internal Revenue
Service (IRS) its Employer's Quarterly Federal Tax
Returns, its annual Employer's Federal Unemployment Tax
Returns, and its annual United States Corporation Tax Return.
26 U.S.C. § 6011; 26 C.F.R. § 31.6071(a)-1. The Law
Office also must withhold its employees' federal income
and Federal Insurance Contributions Act (“FICA”)
taxes, as well as withhold its own FICA, Federal Unemployment
Tax Act (“FUTA”) taxes, and corporation income
taxes. 26 U.S.C. §§ 11, 3102, 3111, 3301, 3402. The
Law Office must make periodic deposits of its withheld taxes
into a federal depository bank. 26 U.S.C. §§ 6302,
6157; 26 C.F.R. § 31.6302-1. The Defendants' answers
to the Complaint did not dispute that they were subject to
these federal tax laws. (DN 8, ¶ 3; DN 9, ¶ 3.)
Plaintiff contends that the Defendants have violated these
tax laws by failing to withhold and pay employment and
unemployment taxes since 2011, failing to make quarterly
payments of its corporate income taxes since 2009, and
failing to file various required tax returns since 2012. (DN
15-3, ¶¶ 16, 22, 25.) The United States claims that
the IRS has attempted to collect the Law Office's tax
debts on numerous occasions, including recording Notices of
Federal Tax Liens against the Defendants. (Id. at
¶ 30.) The Plaintiff also states that a Revenue Officer
hand-delivered a letter to the Law Office informing the
Defendants that the IRS would take additional enforcement
actions, including seeking a civil injunction, if the Law
Office did not make its required federal tax deposits.
(Id. at ¶ 32.) According to the United States,
despite the IRS's efforts, the Defendants nonetheless
failed to make required tax payments. (Id. at ¶
34.) The IRS contends that it has exhausted all of its
administrative abilities to recover the tax debts.
(Id. at ¶ 35.)
support of its motion for summary judgment, the United States
has submitted the Account Transcripts of the Defendants
between the years of 2009 and 2015. The Account Transcripts
show the Defendants' account balances, accrued interest,
penalties, and transactions. (DN 15-4 - 15-6.) The United
States has also submitted the affidavit of Gregory W.
Kamenish (“Kamenish”), a Supervisory Revenue
Officer for the IRS. (DN 15-3.) Kamenish testified to the
accuracy of the Account Transcripts. (Id. at ¶
8.) He stated that a review of the Account Transcripts shows
that the Law Office owes employment taxes in the amount of
$100, 210.80, unemployment taxes in the amount of $3, 740.63,
and corporation income taxes in the amount of 23, 674.86.
(Id. at ¶¶ 11, 17, 23.) These amounts do
not include interest and penalties, which Kamenish asserts
are also owed by law. (Id.)
Plaintiff additionally attached documents evidencing the
IRS' attempts at recovering the Defendants' tax
debts. These include Notices of Federal Tax Liens and a
letter addressed to the Law Office dated May 5, 2015. (DN
15-7; DN 15-8.) This letter states that the IRS would
“consider stricter civil or criminal enforcement
procedures” if federal taxes were not deposited within
thirty days. (DN 15-8.) As the Defendants did not file a
response to the Plaintiff's motion for summary judgment,
these facts are uncontested.
United States claims that, in light of the above undisputed
facts, the court should enter a permanent injunction against
the Defendants pursuant to Section 7402(a) of the Internal
Revenue Code. 26 U.S.C. § 7402(a). Section 7402(a)
states, in relevant part:
The district courts of the United States at the instance of
the United States shall have such jurisdiction to make and
issue in civil actions, writs and orders of injunction. . .
and to render such judgments and decrees as may be necessary
or appropriate for the enforcement of the internal revenue
laws. The remedies hereby provided are in addition to and not
exclusive of any and all other remedies of the United States
in such courts or otherwise to enforce such laws.
Id. The Sixth Circuit has held that “because
the statute expressly authorizes the issuance of an
injunction, the traditional requirements for equitable relief
need not be satisfied.” U.S. v. ITSFinancial, LLC, 592 Fed.Appx. 387, 400 (6th Cir.
2014). Courts have noted the broad scope of power granted by
the statute. Id. at 394; See also United States
v. Hinz, 126 F.Supp.3d 921, 930 (N.D. Ohio 2015)
(“The statute is essentially a catch-all provision that
grants federal courts the authority to issue any remedy that
may be necessary and appropriate for the enforcement of the
internal revenue laws.”) (internal quotations omitted).
Thus, an injunction may be issued if it is ...