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Donald R. Huene v. U.S. Department of the Treasury

August 23, 2012

DONALD R. HUENE, PLAINTIFF,
v.
U.S. DEPARTMENT OF THE TREASURY, INTERNAL REVENUE SERVICE; SIU CHAN; AND ANTHONY SHELLEY, DEFENDANTS.



The opinion of the court was delivered by: Kendall J. Newman United States Magistrate Judge

FINDINGS AND RECOMMENDATIONS

Presently before the court is defendant Internal Revenue Service's ("IRS") motion for summary judgment directed at plaintiff's Freedom of Information Act ("FOIA") claims (Dkt. No. 28).*fn1 This court heard this matter on its civil law and motion calendar on August 23, 2012.

Attorney Ann E. Oliver appeared via telephone on behalf of the IRS.*fn2 Plaintiff, who is proceeding without counsel, failed to appear at the hearing in violation of Local Rule 230(i). The court called plaintiff just before the hearing, but plaintiff did not answer his telephone. In response to the court's inquiry, Ms. Oliver related to the court information contained in recent emails between her and plaintiff that plaintiff essentially chose not to appear at the hearing because he believed the motion was adequately briefed. Although plaintiff's communication with Ms. Oliver does not mitigate plaintiff's failure to appear at a court ordered hearing, the undersigned declines to impose sanctions on plaintiff at this time. See Local Rule 110 ("Failure of counsel or of a party to comply with these Rules or with any order of the Court may be grounds for imposition by the Court of any and all sanctions authorized by statute or Rule or within the inherent power of the Court."); see also Local Rule 183(a) ("All obligations placed on 'counsel' by these Rules apply to individuals appearing in propria persona. Failure to comply therewith may be ground for dismissal, judgment by default, or any other sanction appropriate under these Rules.").

Upon consideration of the parties' briefs, oral arguments, and appropriate portions of the record, the undersigned recommends that the IRS' motion for summary judgment be granted, that judgment be entered in the IRS' favor, and that this case be closed.

I. BACKGROUND

Generally, plaintiff's complaint concerns the alleged actions of the IRS and its agents in connection with a continuing tax audit of plaintiff. (See Compl. ¶ 7.) In connection with the audit, plaintiff requested access to documents concerning him that are alleged to be in the possession of the IRS. (See id.) Specifically, plaintiff alleges that on March 21, 2011, he "formally requested all documents in [the IRS's] possession concerning plaintiff from previous tax filings including the previous 12 years of tax returns, the results of previous audits, and all documents and other instructions in their possession relating to the present audit." (Id., at p. 3:1-5.) Plaintiff alleges that he advised the IRS of the statutory 20-day deadline to respond to his request. (Id., at p. 3:5-6 (citing 5 U.S.C. §§ 552(a)(6)(A)(i)-(ii), (a)(6)(C)).)

Plaintiff alleges that the IRS failed to respond to his FOIA request within 20 days. He further alleges that he gave the IRS an extension of time in which to respond, until June 6, 2011, but that the IRS still did not produce documents to plaintiff. (Compl. ¶ 7, at p. 3:18-21.) Plaintiff alleges that "defendants failed to make a determination regarding plaintiff's FOIA request, failed to disclose any documents or any response whatsoever within the statutory 20 day time deadline pursuant to 5 U.S.C. § 552(a)(6)(i) (2009) and 5 U.S.C. § 552(a)(6)(A)(ii) (2009) and have failed to respond in any manner." (Id., at p. 3:22-26.) Plaintiff filed suit on June 8, 2011.

On March 1, 2012, the undersigned conducted a status (pretrial scheduling) conference in this case, but ultimately declined to enter a scheduling order at that time for multiple reasons. (See Order, Mar. 5, 2012, at 2, Dkt. No. 15.) In part, the undersigned believed that the case might resolve because counsel for the IRS represented that she possessed documents responsive to plaintiff's FOIA request and finally intended to respond to plaintiff's request. Thus, the undersigned ordered the IRS to deliver the documents to plaintiff within ten days, and ordered the parties to file a joint status report after plaintiff had an opportunity to review the documents. (Order, Mar. 5, 2012, at 3.)

The IRS notified the court that it delivered the documents responsive to plaintiff's FOIA request on March 15, 2012, and that plaintiff confirmed receipt of the documents on March 16, 2012 (Dkt. No. 17). Plaintiff filed a status report confirming receipt of the documents, but indicating that the IRS claimed exemptions from disclosure under FOIA. (Pl.'s Status Report, Apr. 2, 2012, at 2, Dkt. No. 18.) The court ultimately set a briefing schedule on the parties' motions for summary judgment, and in so doing denied plaintiff's request for an in camera review of the documents withheld by the IRS.*fn3 (See Order, May 14, 2012, at 6, Dkt. No. 23.)

II. UNDISPUTED FACTS

Although the IRS filed a statement of undisputed material facts ("IRS' SUF"), plaintiff failed to file a response to the IRS' statement or a statement of disputed facts, in violation of Local Rule 260(b). Accordingly, the material facts presented by the IRS are undisputed.

The IRS represents that plaintiff made his FOIA request in a letter dated March 21, 2011, and that plaintiff requested the following: "any and all documents that you and your agents, the Internal Revenue Service or any other government agency has in your possession concerning myself or Yosemite Farms for the audit that is presently taking place.

Finally, I further request that you send any documents, opinions, regulations, source books, manuals, or any other documents or rules that permits [sic] you to request 12 years of documents, from a taxpayer, that are already in your possession." (IRS' SUF ¶ 6.) Yosemite Farms is a sole proprietorship disclosed in a schedule to plaintiff's individual federal tax return, and there is no separate tax identification number or audit file for Yosemite Farms such that all documents related to Yosemite Farms are included in plaintiff's individual audit file. (Id. ¶¶ 11-12.)

The IRS requested additional information from plaintiff in order to process plaintiff's request, and plaintiff provided that information. (Id. ¶¶ 7-9.) The IRS then processed plaintiff's request and searched for records that were responsive to plaintiff's request within the limits of FOIA. (See id. ¶¶ 10-23.)

The employee who searched for records responsive to plaintiff's FOIA request, Glendsey Tucker, reviewed the recovered records and redacted materials she believed fell within FOIA's disclosure exemptions in advance of release to plaintiff. (IRS' SUF ¶¶ 4, 24.) Following the IRS' three requests for extensions of time to respond to plaintiff's FOIA request, the filing of this lawsuit, and an order of the court directing the IRS to respond to plaintiff's request under the threat of sanctions, the IRS finally released to plaintiff what it believed was non-exempt material. (See id. ¶¶ 32-37; see also Order, Mar. 5, 2012, at 3-4.)

The IRS located a total of 394 pages of documents responsive to plaintiff's FOIA request. (IRS' SUF ¶ 38.) It characterizes 48 full pages and portions of two additional pages as not responsive to plaintiff's request because those materials did not pertain to either plaintiff individually or Yosemite Farms. (Id. ¶¶ 39, 43.) The IRS released 389 full pages and five redacted pages to plaintiff. (Id. ¶ 40.) Of the five pages withheld from plaintiff, the IRS determined that the pages numbered 77 and 85 contained non-responsive material that could be segregated and redacted. (Id. ¶ 41.) It further concluded the pages numbered 56 and 62 reflected information used by the IRS to "identify returns for examination," and the IRS claimed that these two pages were exempt from disclosure pursuant to FOIA's exemption found at 5 U.S.C. §§ 552(b)(3) and (b)(7)(E). (Id. ¶¶ 41, 50-75.) Finally, the IRS withheld part of page number 7 on the grounds that it consists of an intra-agency email reflecting opinions and thoughts regarding an ongoing audit and, as a result, falls within the FOIA exemption found at 5 U.S.C. § 552(b)(5). (Id. ¶¶ 41, 45-49.)*fn4

III. LEGAL STANDARDS

A. General Summary Judgment Standards

Federal Rule of Civil Procedure 56(a) provides that "[a] party may move for summary judgment, identifying each claim or defense--or the part of each claim or defense--on which summary judgment is sought." It further provides that "[t]he court shall grant summary judgment if the movant shows 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).*fn5 A shifting burden of proof governs motions for summary judgment under Rule 56. Nursing Home Pension Fund, Local 144 v. Oracle Corp. (In re Oracle Corp. Sec. Litig.), 627 F.3d 376, 387 (9th Cir. 2010). Under summary judgment practice, the moving party always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those ...


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