            3Jn tbc Wnitcb ~tatcs Qtourt of §cbcral ~Iaims
                                            (Pro Se)
                                        No. #18-1665C
                        (Filed: September 16, 2019 I Not for Publication)

                                                  )
 BAHIG F. BISHAY,                                 )
                                                  )   Keywords: I.RC. § 6672; Token
                       Plaintiff,                 )   Payment; Tax Refund; Motion to Dismiss;
                                                  )   Subject-Matter Jurisdiction; Pro Se
 V.                                               )
                                                  )
 THE UNITED STATES OF AMERICA,
                                                  )              Received • USCFC
                                                  )
                                                  ~
                       Defendant.
                                                                    SEP 16 2019
_ _________ _ _____ )

Bahig F. Bishay, Norwood, MA, pro se.

Courtney M Hutson, Trial Attorney, U.S. Depai1ment of Justice, Tax Division, Court of Federal
Claims Section, Washington, D.C., with whom were Richard E. Zuckerman, Principal Deputy
Assistant General and David I Pincus, Chief, Court of Federal Claims Section, for Defendant.

                                    OPINION AND ORDER


KAPLAN, Judge.

        Presently before the Court are Plaintiff Bahig Bishay's motion for leave to proceed in
forma pauperis, Docket No. 4, and the government's motion to dismiss pursuant to Rule 12(b)(l)
of the Rules of the Com1 of Federal Claims ("RCFC"), Def. 's Mot. to Dismiss ("Defs. Mot.") at
1, Docket No. 23. For the reasons that follow, Plaintiffs motion for leave to proceed in forma
pauperis is GRANTED. The government's motion to dismiss is likewise GRANTED and
Plaintiffs complaint is DISMISSED without prejudice for lack of subject-matter jurisdiction.

                                         DISCUSSION

I.     Motion for Leave to Proceed In Forma Pauperis

        Mr. Bishay requests that the Comt allow him to proceed in forma pauperis. Pursuant to
28 U.S.C. § 1915(a)(l), "any com1 of the United States may authorize the commencement ... of
any suit, action or proceeding ... without prepayment of fees or security therefor, by a person
who submits an affidavit that includes a statement ... that the person is unable to pay such fees
or give security therefor." 1 A plaintiff does not have to "be absolutely destitute to enjoy the
benefit of the statute." Adkins v. E.I. DuPont De Nemours & Co. 335 U.S. 331,339 (1948). An
affidavit that demonstrates that a plaintiff is unable to pay the fee or give security and still
provide for himself and any dependents is sufficient. See id.; Waltner v. United States 93 Fed.
Cl. 139, 143 (2010) (stating that the question is whether "paying such fees would constitute a
serious hardship on the plaintiff').

         Mr. Bishay states in his application that he currently has $ I ,200 in cash or bank accounts.
Pl. 's Appl. To Proceed In Forma Pauperis at 2, Docket No. 4. He is currently unemployed and
receives Social Security benefits in the amount of"$ I ,420/mo." Id. at 2. Under these
circumstances, Mr. Bishay has sufficiently demonstrated that he is unable to pay the court's
filing fee. His application to proceed in fornm pauperis is therefore GRANTED.

II.    Background

         PlaintiffBahig Bishay, appearing prose, filed a complaint in this comi on October 17,
20 I 8, alleging that the Internal Revenue Service ("the IRS") "arbitrarily, maliciously, and
unjustly," recorded a tax lien against him in the amount of $41,612.40. Comp!. ,i,i 2, 5, Docket
No. 1. He contends that the lien was based on an inaccurate allegation by the IRS that
Commonwealth Auto Company, Inc. ("Commonwealth Auto"), a company for which he had
once been the president and sole shareholder, had failed to collect, account for, and pay over
certain payroll taxes for the first two quarters of 2002. Id. ,i 2. Mr. Bishay challenges the IRS's
determinations that Commonwealth Auto-which subsequently filed for bankruptcy-never paid
over the taxes and/or that he bears responsibility for their payment. Id.

         The IRS assessed a penalty against Mr. Bishay on February 5, 2007 in accordance with
I.R.C. § 6672. Def.'s Mot. Ex. 1, at I (IRS transcript for Bahig Bishay indicating that an I.R.C.
trust fund recovery penalty was assessed February 5, 2007); see also Comp!. Ex. I, at 31-36
(CP15B notices informing Mr. Bishay that penalty was assessed for tax periods ending March 31
and June 30, 2002). 2 The lien at issue was recorded on August 29, 2013. Comp!. Ex. I, at 37
(notice of federal tax lien). In its February 5, 2007 notices, the IRS advised Mr. Bishay of his
right to file a suit for a refund. Id. at 31, 34. The notices instructed him that, to do so, he must




1
  For purposes of28 U.S.C. § 1915, the Comi of Federal Claims is a court of the United States.
28 U.S.C. § 2503(d).
2
  I.R.C. § 6672(a) provides that a person is subject to a 100% tax penalty ifhe "willfully fails to
collect[], or truthfully account for and pay over[], or willfully attempts in any manner to evade or
defeat" such tax which he is "required to collect, truthfully account for, and pay over." See also
Godfrey v. United States, 748 F.2d 1568, 1573-74 (Fed. Cir. 1984) (discussing the elements ofa
penalty under I.R.C. § 6672). In other words, the statute imposes personal liability on officers or
employees of a company who are responsible for collecting federal income and social security
taxes withheld from employees' paychecks. See Def.'s Mot. at 2. The government refers to this
penalty as a "trust fund recovery penalty." Id.


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"pay the withheld tax for one employee for one quarter of liability" and also must "file a claim
for refund on Form 843 ... for the amount paid by March 7, 2007." Id. 3

        The IRS's instruction that Mr. Bishay must pay the withheld tax for one employee for
one qumier of liability stems from the requirement that, to invoke this Couti's jurisdiction in a
tax refund suit, a plaintiff must comply with the "full payment rule"-i.e., he must demonstrate
that the principal tax deficiency was paid in full. See Shore v. United States, 9 F.3d 1524, 1526-
27 (Fed. Cir. 1993); Jackson v. United States, 143 Ft,d. Cl. 242,246 (2019). Where, as here, the
tax in question involves a § 6672 penalty, the plaintiff can satisfy the full payment rule by paying
the "IRS an amount equal to one employee's withholding for one qumier." Vir v. United States,
125 Fed. Cl. 293,301 (2016) (citing Godfrey v. United States, 748 F.2d 1568, 1573 (Fed. Cir.
1984)),

        Mr. Bishay alleges in his complaint that in July 2015 he made a "token" payment to the
IRS "pursuant to the federal authority explained in Weber v. Commissioner, 138 T.C. 348,363
n. 12 (2012)." Comp!. ,r,r 7, 24; see also Comp!. Ex. 1, at 44 (letter dated July 23, 2015 from Mr.
Bishay to the IRS noting that "appended herewith [are] two re-dated 843 Forms, together with
'token' payment in the sum of$100.00 U.S. Dollars"). The referenced footnote in the Weber
decision states that "a taxpayer may litigate the penalty after having paid an amount
corresponding to the tax withheld from a single employee." 138 T.C. at 363 n.12. The IRS's
ce1iified transcript for Mr. Bishay's account reveals that he made a $100 payment toward his
trust fund penalty liability on August 7, 2015. Def.'s Mot. for a More Definite Statement, Ex. 1,
at 2, Docket No. 20.

       The government filed a motion for a more definite statement on May 24, 2019 asking Mr.
Bishay to put forth facts to show that the $100 payment was equivalent to the tax due for one
employee for one qumier of liability. The government observed that certain payroll records
provided as exhibits to the complaint cast doubt upon whether the $100 payment would be
enough to cover withholding for any single employee for a quarter. See Defs Mot. at 9-11.
Though the Couti denied the government's motion for a more definite statement, it cautioned
that "Mr. Bishay [would] be required to produce evidence sufficient to establish that the $100

3
  Mr. Bishay was also notified of this requirement in a memorandum opinion issued by the
United States Tax Court in 2015. See Bishay v. Comm'r oflnternal Revenue, 109 T.C.M. (CCH)
1543, 2015 WL 3505310, at *6 n.9 (June 4, 2015). After unsuccessfully challenging the IRS's
assessment of the § 6672 penalty, Mr. Bishay timely filed suit in the Tax Court. Id. at *2-3. In
that case, Mr. Bishay alleged that he was not liable for the trust fund recovery penalties because
of the appointment of a bankruptcy trustee in June 2002. Id. at *2. He futiher alleged that he was
not liable for the § 6672 penalty because the IRS should have-and failed to-pursue the taxes
from the bankruptcy estate. Id. at *3. The Tax Comi granted the IRS's motion for summary
judgment, finding that the IRS did not abuse its discretion by issuing a notice of federal tax lien
to recover the§ 6672 penalty from Mr. Bishay. Id. at *8. In its opinion, the Tax Court informed
Mr. Bishay that a "taxpayer whose liability is upheld in the Letter 1153 proceeding can make a
small 'token' payment towards the section 6672 penalty, file a refund claim with the IRS, and, if
the refund claim is denied, file a refund suit in Federal District Court or the Comi of Federal
Claims." Id. at *6 n.9.


                                                 3
payment he allegedly made to the IRS is equivalent to the tax due for one employee for one
quarter ofliability." Order at 4, Docket No. 22. The government filed its motion to dismiss for
lack of subject-matter jurisdiction on June 24, 2019.

II.     The Government's Motion to Dismiss

        In considering a motion to dismiss for lack of subject-matter jurisdiction, the Court
accepts as true all undisputed facts in the pleadings and draws all reasonable inferences in favor
of the plaintiff. Trusted Integration, Inc. v. United States, 659 F.3d 1159, 1163 (Fed. Cir. 2011).
The Court may, however, "inqnire into jurisdictional facts" to determine whether it has
jurisdiction. Rocovich v. United States, 933 F.2d 991,993 (Fed. Cir. 1991). It is well-established
that complaints filed by pro se plaintiffs are held to "less stringent standards than formal
pleadings drafted by lawyers." Haines v. Kerner, 404 U.S. 519, 520 (1972). Nonetheless, even
pro se plaintiffs must persuade the Court that jurisdictional requirements have been met. Harris
v. United States, 113 Fed. Cl. 290,292 (2013).

        The Tucker Act grants the United States Court of Federal Claims jurisdiction over "any
claim against the United States founded ... upon the Constitution, or any Act of Congress or any
regulation of an executive depmiment, or upon any express or implied contract with the United
States." 28 U.S.C. § 149l(a)(I). It serves as a waiver of sovereign immunity and a jurisdictional
grant, but it does not create a substantive cause of action. Jan's Helicopter Serv., Inc. v. Fed.
Aviation Admin., 525 F.3d 1299, 1306 (Fed. Cir. 2008). A plaintiff, therefore, must establish
that "a separate source of substantive law ... creates the right to money damages." Id. (quoting
Fisher v. United States, 402 F.3d 1167, 1172 (Fed. Cir. 2005) (en bane in relevant part)); Rick's
Mushroom Serv., Inc., 521 F.3d at 1343 ("[P]laintiffmust look beyond the Tucker Act to
identify a substantive source of law that creates the right to recovery of money damages against
the United States.") (citation omitted).

        In regards to tax disputes, the Court's jurisdiction is generally limited to tax refund suits.
See 28 U.S.C. § 1346(a)(l) (granting the Comi of Federal Claims concurrent jurisdiction with
federal district courts over "[a]ny civil action against the United States for the recovery of any
internal-revenue tax alleged to have been erroneously or illegally assessed or collected, or any
penalty claimed to have been collected without authority or any sum alleged to have been
excessive or in any marmer wrongfully collected under the internal-revenue laws"); Cheesecake
Factory, Inc. v. United States, 111 Fed. Cl. 686,690 (2013) (citing 28 U.S.C. § 1346(a)(l));
Riggle v. United States, 131 F. App'x. 273,274 (Fed. Cir. 2005) (unpublished) (citing, inter alia,
Shore, 9 F.3d at 1526).

        In order to meet this court's jurisdictional requirements in a tax refund suit, a plaintiff
must: 1) satisfy the full payment rule; 2) timely file a tax refund claim with the IRS; and 3)
provide the amount, date, and place of each payment to be refunded, along with a copy of the
refund claim. Fry v. United States, 72 Fed. Cl. 500,510 (2006). To satisfy the full payment rule
in regards to an I.R.C. § 6672 penalty, a taxpayer must pay the amount of the assessment
attributable to one employee's withholding. Vir, 125 Fed. Cl. at 300 (quoting Boynton v. United
States, 566 F.2d 50, 52 (9th Cir. 1977)). The rationale for this is that"[§] 6672 assessments
represent a cumulation of separable assessments for each employee from whom taxes were
withheld." Boynton, 566 F.2d at 52. Thus, "courts have permitted [§] 6672 refund cases to

                                                  4
proceed when the taxpayer prepaid the IRS an amount equal to one employee's withholding for
one quarter." Vir, 125 Fed. Cl. at 301 (citing Godfrey, 748 F.2d at 1573).

         The government argues that the Court lacks subject-matter jurisdiction because Mr.
Bishay has "alleged no facts that suggest [his] $ 100 [payment] equals the withholding for one
employee for one quarter" and has "failed to produce any documents ... to support the notion
that $100 was sufficient to cover the withholding for one employee." Defs Mot. at 9. It further
contends that Mr. Bishay's $100 payment "was less than one third of the amount of the smallest
federal withholding for the three quarters ending September 30, 2002, for one employee" and
that the smallest withholding for one employee for the three quaiiers ending September 30, 2002
was $406.60 (see Comp!. Ex. 1, at 15)-----one third of which would be $135.53. Def.'s Mot. at 9-
10. The government states that this suggests the $ 100 payment was not enough to cover the
withholding for any single employee for both quarters at issue here. Id. at 10.

       Mr. Bishay has not supplied facts to challenge the government's asse1iions. Instead, Mr.
Bishay presents an affidavit attesting to the fact that he was Commonwealth Auto's lowest paid
employee, having received $0 dollars per hour from September 1999 through June 2002. Aff. of
Bahig Bishay at ,r,r 1-2, Docket No. 26-1. Therefore, in his view, the $100 token payment is
equivalent to more than his withholding for at least one quarter. PL 's Resp. to Def. 's Mot. to
Dismiss at 9-10, Docket No. 26.

         Mr. Bishay's asse1iion, even if true, fails to qualify as a "token payment." The exception
to the full-payment rule states that "a taxpayer assessed under section 6672 need only pay the
divisible amount of the penalty assessment attributable to a single individual's withholding
before instituting a refund action." Roseman v. United States, No. 09-539T, 2013 WL 151716, at
*1 (Fed. CL Jan. 3, 2013) (citing Boynton, 566 F.2d at 52) (emphasis supplied). If the Court
accepts Mr. Bishay's statement that he did not receive a salary during the relevant time periods
as true, that means he did not owe any tax for that period and so none would have been withheld.
Thus, this zero dollars could not serve as a "divisible amount of the penalty assessment
attributable to a single individual's withholding." Id. Because Mr. Bishay has failed to establish
that his $100 payment was attributable to one employee's withholding for one quaiier, he has
failed to demonstrate that the Comi possesses subject-matter jurisdiction over his tax refund
claim.

       Likewise, the Court does not have jurisdiction over his remaining claims. First, Mr.
Bishay asks for declaratory judgment that: 1) he does not owe the government any money; 2) the
government was not entitled to record a federal tax lien against him; 3) the government failed to
make a showing that Mr. Bishay exercised control over the payment of taxes owed; and 4) the
government was barred by the statute of limitations from recording a federal tax lien against him.
Comp!. at 5, ,r,r 1-4. However, "this Court may not grant declaratory relief if such relief is the
primary focus of the plaintiffs suit." Rice v. United States, 31 Fed.Cl. 156, 164 (1994), affd, 48
F.3d 1236 (Fed. Cir. 1995). Thus, the Comi finds that Mr. Bishay's claims requesting declaratory
judgment are beyond the scope of its jurisdiction.

         Although the Court of Federal Claims has concurrent jurisdiction with United States
district comis over tax refund suits, this jurisdiction does not extend to cases challenging the
validity of tax liens. See 28 U.S.C. § 1346(a)(l); George v. United States, No. 99-347T, 1999

                                                 5
WL 1211626, at *1 (Fed. Cl. May 28, 1999). Congress reserved tax lien challenges for federal
district and state courts. See 28 U.S.C. § 24IO(a) ("[T]he United States may be named a party in
any civil action or suit in any district court, or in any State court having jurisdiction of the
subject matter ... to quiet title to ... real or personal property on which the United States has or
claims a mortgage or other lien.") (emphasis added). Additionally, the Court lacks jurisdiction on
claims that request a withdrawal of a tax lien or a reinstatement of exempt withholding status
because the claims are not based upon a money-mandating substantive source oflaw. See
Gregoline v. United States, 99 Fed. Cl. 161, 168 (2011) (citing Fisher v. United States, 402 F.3d
1167, 1172 (Fed. Cir. 2005)). Therefore, Mr. Bishay' s challenges to the tax lien are not within
the Court's jurisdiction.

         Finally, the Anti-Injunction Act prevents this Coutt from granting injunctive relief
regarding IRS collection proceedings. See 26 U.S.C. § 7421; see also Schlabach v. United States,
97 Fed. Cl. 232,234 (2011) ("The Anti-Injunction Act[] 'flatly prohibits' the grant of injunctive
relief regarding IRS collection proceedings") (quoting Ledford v. United States, 297 F.3d 1378,
1381 (Fed. Cir. 2002)). To the extent that Mr. Bishay requests injunctive relief against the
government when he asks the Court to "DISCHARGE [the Defendant's] Federal Tax Lien ...
and further enjoin the Defendant from attempting to collect any money from the Plaintiff on
account of any taxes previously owed by [Commonwealth Auto]," Comp!. at 5, ,r 5, the Court
lacks jurisdiction over his request.

                                         CONCLUSION

       Plaintiff's motion for leave to proceed in fornm pauperis is GRANTED. Because the
Coutt lacks subject-matter jurisdiction over Mr. Bishay's complaint, the government's motion to
dismiss is also GRANTED. Mr. Bishay's complaint is therefore DISMISSED without
prejudice. The Clerk is directed to enter judgment accordingly. Each side shall bear its own
costs.

       IT IS SO ORDERED.




                                                     Judge




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