17-2500-cv
Campaniello v. NY State Dept.


                          UNITED STATES COURT OF APPEALS
                              FOR THE SECOND CIRCUIT
                                             SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY
FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT=S LOCAL RULE 32.1.1. WHEN
CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE
EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION
ASUMMARY ORDER@). A PARTY CITING TO A SUMMARY ORDER MUST SERVE A COPY OF IT ON
ANY PARTY NOT REPRESENTED BY COUNSEL.

       At a stated term of the United States Court of Appeals for the Second Circuit, held
at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New
York, on the 20th day of September, two thousand eighteen.

PRESENT: RALPH K. WINTER,
           JOHN M. WALKER, JR.,
           CHRISTOPHER F. DRONEY,
                    Circuit Judges.
_____________________________________

THOMAS CAMPANIELLO, SANDRA
CAMPANIELLO,

                                Plaintiffs-Appellants,

NATHAN LEWIN

                                            Plaintiff,

                  v.                                          17-2500-cv

NEW YORK STATE DEPARTMENT OF TAXATION
AND FINANCE, NEW YORK STATE DIVISION OF
TAX APPEALS TRIBUNAL, COMMISSIONER OF
TAX AND FINANCE, JAMES H. TULLY, JR.,

                                                         1
ROBERTA MOSELEY NERO,

                 Defendants-Appellees.
_____________________________________

FOR PLAINTIFFS-APPELLANTS:                  NATHAN LEWIN (Alyza D. Lewin, on the brief),
                                            Lewin & Lewin LLP, Washington, DC.

                                            Richard H. Dolan and Seth D. Allen, Schlam
                                            Stone & Dolan LLP, New York, NY.

FOR DEFENDANTS-APPELLEES:                   SCOTT A. EISMAN (Anisha S. Dasgupta, on the
                                            brief), for Barbara D. Underwood, Attorney
                                            General of the State of New York, New York,
                                            NY.

      Appeal from the United States District Court for the Southern District of New York
(Schofield, J.).

    UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of the district court is AFFIRMED.

        Plaintiffs-Appellants Thomas Campaniello and Sandra Campaniello appeal from
the district court’s decision dismissing their complaint for lack of subject matter
jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1). On appeal, they contend
that their claims are not barred by the Tax Injunction Act and that New York's tax laws are
discriminatory. We affirm the district court's dismissal and conclude that the Tax
Injunction Act deprived the district court of subject matter jurisdiction over this matter. We
assume the parties’ familiarity with the facts and record of prior proceedings, which we
briefly summarize as necessary to explain our decision. We then turn to the merits of this
appeal.

 I.    The Campaniello's Allegations and Procedural History

      Plaintiffs-Appellants Thomas Campaniello ("Thomas") and Sandra Campaniello
("Sandra") (collectively, "Plaintiffs-Appellants") brought an action against Defendants
New York State Department of Taxation and Finance ("Department of Taxation"); New
York State Division of Tax Appeals, Tax Appeals Tribunal ("TAT"); Commissioner of
Taxation and Finance ("Commissioner"); James H. Tully, Jr. and Roberta Mosely Nero

                                              2
(collectively "Defendants-Appellees"), alleging, in an action brought pursuant to 42 U.S.C.
§ 1983, that the Defendants-Appellees had violated their rights under the Fourteenth
Amendment to the U.S. Constitution. Defendants-Appellees filed a motion to dismiss this
action in the district court for lack of subject matter jurisdiction pursuant to Federal Rule
12(b)(1) of the Federal Rules of Civil Procedure, which the district court granted.

       Plaintiffs-Appellants are married, but live separately for approximately half of the
year, with Sandra residing in New York and Thomas residing in Florida while apart.
Thomas frequently travels to New York to visit Sandra, their daughter, and their grandson.
Thomas moved to New York City from Italy to be in a relationship with Sandra after they
met while both vacationing in Rome. Thereafter, they were married and resided in New
York, where they entered the furniture business. In 1981, Thomas purchased a
condominium apartment in Florida and opened a Florida showroom for his furniture
company. By 2006, Thomas had accumulated nine properties in Florida. Thomas alleges
that he obtained a Florida driver's license in 1998 and began moving his "prized
possessions" to Florida in 2006, including his Ferrari, catamaran, and classical guitars. In
November 2007, Thomas sold one of his Florida investment properties. From that sale, he
realized a capital gain of $5,392,445. Thomas did not file a resident state tax return in New
York for the calendar year 2006, because he concluded that he was domiciled in Florida,
and instead filed a nonresident New York tax return. He filed that return on December 6,
2007, pursuant to an extension granted for the filing of his 2006 return, after he sold the
Florida investment property. For the calendar year 2007, Thomas also filed nonresident tax
returns in New York.

        On November 14, 2011, Thomas was served with a Notice of Deficiency by the
Commissioner for the 2007 tax year, stating that he owed $488,781.00 in tax, $177,824.15
in interest, and $113,349.56 in penalties for capital gains from selling the Florida property.
The Tax Division assessed this amount because it determined that Thomas was a New York
resident and should have filed a resident New York tax return for 2006 and 2007, which
would have required Thomas to pay capital gains taxes on the sale of the property.

       Thomas appealed the decision of the Tax Division and had a hearing before an
Administrative Law Judge ("ALJ"). The ALJ affirmed the decision of the Tax Division on
June 25, 2015. Thomas then appealed that decision to the TAT. On July 21, 2016, the TAT
affirmed the ALJ's decision in an opinion issued by Commissioners Tully and Nero, the
individual Defendants named in this suit. Thomas then appealed the TAT decision to the
New York Supreme Court Appellate Division, Third Department, pursuant to Article 78 of
the New York Civil Practice Law and Rules and Section 2016 of the New York Tax Law,
asserting that the decision was arbitrary and capricious and not supported by substantial

                                              3
evidence. While that action was still pending, Plaintiffs-Appellants filed this action on
November 18, 2016. Plaintiffs-Appellants' action asserts a cause of action under 42 U.S.C.
§ 1983 for the violation of their Fourteenth Amendment "right to live their marriage in the
manner in which they desire." J. App’x at 18. On March 3, 2017, the Defendants filed a
motion to dismiss for lack of subject matter jurisdiction, which the district court granted
on July 27, 2017.

 II.   Standard of Review

       On appeal from a judgment dismissing a suit for lack of subject matter jurisdiction
under Federal Rule of Civil Procedure 12(b)(1), we review a district court's factual
determinations for clear error and legal conclusions de novo. Makarova v. United States,
201 F.3d 110, 113 (2d Cir. 2000). Moreover, "[a] plaintiff asserting subject matter
jurisdiction has the burden of proving by a preponderance of the evidence that it exists."
Id. In deciding a motion to dismiss under Rule 12(b)(1), a "district court must take all
uncontroverted facts in the complaint . . . as true, and draw all reasonable inferences in
favor of the party asserting jurisdiction." Tandon v. Captain's Cove Marina of Bridgeport,
Inc., 752 F.3d 239, 243 (2d Cir. 2014).

III.   The Tax Injunction Act

        The Tax Injunction Act ("TIA"), 28 U.S.C. § 1341, "prevents federal courts from
giving injunctive relief or declaratory relief, as long as there is a plain, speedy and efficient
remedy in state court." Bernard v. Vill. of Spring Valley, N.Y., 30 F.3d 294, 297 (2d Cir.
1994) (quoting Long Island Lighting Co. v. Town of Brookhaven, 889 F.2d 428, 431 (2d
Cir. 1989)). The TIA is meant to strictly limit federal courts from interfering with local tax
matters. Long Island Lighting Co., 889 F.2d at 431. This prohibition is jurisdictional and
strips the federal courts of subject matter jurisdiction. Id.

        Plaintiffs-Appellants are seeking to enjoin New York from treating Thomas as a
New York resident for the purposes of assessing and collecting state taxes. As such, their
suit falls squarely within the type of interference with state courts that the TIA is meant to
prevent. Plaintiffs-Appellants' argument that their suit is broader than the tax laws of New
York is unavailing as the only defendants are tax officials and agencies, the only alleged
conduct at issue is related to a tax liability, and the only relief requested relates to enjoining
tax officials and agencies from applying the Tax Laws "in violation of the Fourteenth
Amendment." J. App'x 19.

       Moreover, New York provides "plain, speedy, and efficient relief" for taxpayers. A
state court provides a taxpayer with "plain, speedy, and efficient relief" if that taxpayer is

                                                4
afforded "a full hearing and judicial determination at which she may raise any and all
constitutional objections to the tax." California v. Grace Brethren Church, 457 U.S. 393,
411 (1982) (internal quotation marks omitted). The Supreme Court concluded that New
York's procedures for challenging tax assessments satisfied this standard. Tully v. Griffin,
Inc., 429 U.S. 68, 74–77 (1976); see also Long Island Lighting Co., 889 F.2d at 431
("Because New York provides several remedies which afford [plaintiff] an opportunity to
raise all constitutional objections to the real property taxes imposed, . . . the Tax Injunction
Act bar[s] access to federal court."). Because New York offers an adequate remedy to the
Plaintiffs-Appellants, we conclude that we are without jurisdiction under the TIA to grant
them any injunctive relief.

IV.    Principles of Comity

        Plaintiffs-Appellants’ requested relief is also barred by the comity doctrine, which
"restrains federal courts from entertaining claims for relief that risk disrupting state tax
administration," Levin v. Commerce Energy, Inc. 560 U.S. 413, 417 (2010), provided that
plaintiffs can access "state remedies that are plain, adequate, and complete, and may
ultimately seek review of the state decisions in [the Supreme] Court." Abuzaid v. Mattox,
726 F.3d 311, 315 (2d Cir. 2013) (alteration in original) (internal quotation marks omitted).
Plaintiffs-Appellants’ claims would disrupt state tax administration by preventing New
York State from assessing and collecting taxes from married individuals living apart who
tax authorities have found to be domiciled in New York. Moreover, we have consistently
found that New York state courts provide a "plain, adequate, and complete remedy" for
litigants. See, e.g., id. at 315–16. For these reasons, the Plaintiffs-Appellants' requested
relief is also barred by the doctrine of comity.

 V.     Declaratory Judgment Act

        Plaintiffs-Appellants also seek declaratory relief in the form of a "declaration that
'living apart together' is a protected type of marriage under the Fourteenth Amendment to
the United States Constitution." J. App'x 19. Because we have determined that the federal
courts do not have subject matter jurisdiction to adjudicate the dispute between the
Plaintiffs-Appellants and New York State's tax authorities, we also lack the power to grant
the requested declaration. Keene Corp. v. Fiorelli (In re Joint E. & S. Dist. Asbestos Litig.),
14 F.3d 726, 731 (2d Cir. 1993) ("[A] request for relief in the form of a declaratory
judgment does not by itself establish a case or controversy involving an adjudication of
rights.").




                                               5
       We have considered the remainder of Plaintiffs-Appellants' arguments and conclude
they are without merit. For the reasons stated above, we AFFIRM the district court’s
judgment.

                                        FOR THE COURT:
                                        Catherine O’Hagan Wolfe, Clerk of Court




                                           6
