                             UNITED STATES DISTRICT COURT
                             FOR THE DISTRICT OF COLUMBIA


THEODORA CATO,                         )
                                       )
               Plaintiff,              )
                                       )
               v.                      )             Civil Action No. 18-2935 (RC)
                                       )
                                       )
TRACIE NOYES et al.,                   )
                                       )
               Defendants.             )


                                 MEMORANDUM OPINION

                                      I. INTRODUCTION

       Plaintiff, appearing pro se, filed a cryptically worded Complaint, ECF No. 1, against the

United States, several employees of the Internal Revenue Service (“IRS”), and three private

individuals. The complaint against the private individuals has been dismissed for lack of

personal jurisdiction, see Order, ECF No. 18, and what remains has been construed as a suit

against the United States for a tax refund under 26 U.S.C. § 7422 and for civil damages under 26

U.S.C. § 7433. See July 26, 2019 Minute Order (granting motion to substitute the United States

as the proper defendant).

       Pending before the Court is the United States’ Motion for Summary Judgment under Rule

56 of the Federal Rules of Civil Procedure, ECF No. 20. Plaintiff has opposed the motion, ECF

No. 25; the United States has replied, ECF No. 26; and Plaintiff has filed a “civil statement,”

ECF No. 27 (hereafter “Sur-reply”). For the following reasons, the motion will be granted. 1




1
  Also pending is Plaintiff’s motion for an appointment of counsel, which, after careful
consideration of the factors for appointing counsel, see LCvR 83.11(b)(3), the Court will deny.
                                                 1
                                         II. BACKGROUND

         The documented material facts are as follows. 2 Plaintiff is the disabled adult child of a

deceased federal employee who receives survivor annuity payments from the U.S. Office of

Personnel Management (“OPM”), Retirement Programs. Def.’s Statement of Facts (“SOF”) ¶ 4,

ECF No. 20-2 at 2-5. The annuity payments were Plaintiff’s only reported source of income in

tax years 2014 and 2015, which are the subject of this action.

         Plaintiff’s survivor benefits also included “health insurance through the Federal

Employees Health Benefits Plan[,]” and she “specifically . . . elected Blue Cross Blue Shield’s

Federal Employee Plan.” SOF ¶ 6. “OPM deducted the cost of [Plaintiff’s] health insurance

premiums from her monthly benefits payments.” Id. ¶ 7. In Form 1099-R (statement of annuity

payments), OPM reported for tax year 2014 that Plaintiff was paid $5,760 in survivor benefits,

from which $2,279.22 were deducted to pay for Plaintiff’s health insurance premiums. Id. ¶ 8;

Ex. B at 3. For tax year 2015, Plaintiff was paid $5,856 in survivor benefits, from which

$2,359.81 were deducted to pay for the health insurance premiums. Id.; Ex. E at 3.

         The IRS received Plaintiff’s 2014 income tax return on April 15, 2015; her 2015 income

tax return on April 15, 2016; and her amended income tax returns for both years on November

21, 2017. SOF ¶¶ 1-2. For both years, Plaintiff claimed a tax credit under the Health Coverage

Tax Credit (“HCTC”), 26 U.S.C. § 35. 3       Id. ¶ 10; see also Compl. Exs. at 15-16 (completed



2
  In support of summary judgment, Defendant has proffered the Declaration of Rachel L. Gregory,
who is an Attorney with the IRS’s Office of Chief Counsel, Small Business/Self-Employed
Division. Gregory’s declaration is based on information she obtained in the course of her official
duties, including from her review of the income tax returns and account transcripts attached as
exhibits to the declaration. See Gregory Decl. ¶¶ 3-17.
3
    Paragraph (a) of the statute provides:

                 In the case of an individual, there shall be allowed as a credit against
                                                    2
2017 Health Coverage Tax Credit Form and inquiries about refund checks for years 2014 and

2015). For 2014, Plaintiff “asserted that she was due a refund in the amount of $2,278, which

[was] 72.5% of the total of health insurance premiums and prescription drug costs that she paid

for 2014.” SOF ¶ 12. For 2015, Plaintiff “asserted that she was due a refund . . . of $2,066,

which [was] approximately 72.5% of the total of health insurance premiums and prescription

drug costs that she paid for 2015.” Id. ¶ 14.

       Eventually, the IRS “disallowed” Plaintiff’s “refund claims because she never provided

the requested documentation showing that she was eligible for the HCTC.” SOF ¶ 17. In a letter

to Plaintiff dated July 26, 2018, the independent Taxpayer Advocate Service informed Plaintiff

that “[t]o be eligible for the HCTC, you cannot be enrolled in the Federal Employees Health

Benefits Program (FEHBP),” and the fact that she was so enrolled disqualified her for the

HCTC. Compl. Ex., ECF No. 1-1 at 20-21.

       Nevertheless, Plaintiff filed this action on December 13, 2018, seeking a tax refund based

on the HCTC “for 2014 and the year 2015,” Compl. at 10, and punitive damages “based on the

alleged theft of her refund checks,” Mem. of Law in Support of the United States’ Mot. for

Summ. J. at 1, ECF No. 20-2. Plaintiff later elaborates that “the 2014 and 2015 checks were

cashed without [her] consent at the [Capital One] bank that [she does] not have a[n] account

with,” Sur-reply at 4, and that “employees or a[n] employer . . . had the money transferred to a

[Capital One] bank account” that was not her account and “the money was sent to the defendants



               the tax imposed by subtitle A an amount equal to 72.5 percent of the
               amount paid by the taxpayer for coverage of the taxpayer and
               qualifying family members under qualified health insurance for
               eligible coverage months beginning in the taxable year.

26 U.S.C. § 35(a). The tax returns in the record show that in 2014 and 2015, Plaintiff reported no
taxable income and “paid $0 in taxes[.]” SOF ¶ 3.
                                                3
that worked for the federal government[.]” Id. at 2. She therefore seeks $50,000 in punitive

damages “based on facts that the fraud [and theft] [were] committed[.]” Id. at 5.

                                     III. LEGAL STANDARD

        Under Rule 56 of the Federal Rules of Civil Procedure, a court must 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). A “material” fact is

one capable of affecting the substantive outcome of the litigation. See Anderson v. Liberty

Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is “genuine” if there is enough evidence for a

reasonable jury to return a verdict for the non-movant. See Scott v. Harris, 550 U.S. 372, 380

(2007). The inquiry under Rule 56 is essentially “whether the evidence presents a sufficient

disagreement to require submission to a jury or whether it is so one-sided that one party must

prevail as a matter of law.” Anderson, 477 U.S. at 251-52.

        The principal purpose of summary judgment is to determine whether there is a genuine

need for trial by disposing of factually unsupported claims or defenses. See Celotex Corp. v.

Catrett, 477 U.S. 317, 323-24 (1986). The movant bears the initial burden of identifying

portions of the record that demonstrate the absence of any genuine issue of material fact. See

Fed. R. Civ. P. 56(c)(1); Celotex, 477 U.S. at 323. In response, the non-movant must point to

specific facts in the record that reveal a genuine issue that is suitable for trial. See Fed. R. Civ. P.

56(c)(1); Celotex, 477 U.S. at 324. The non-movant may not rest upon mere allegations or

denials but must instead present affirmative evidence. Laningham v. U.S. Navy, 813 F.2d 1236,

1241 (D.C. Cir. 1987) (citing Anderson, 477 U.S. at 257).

        In considering a motion for summary judgment, a court must “eschew making credibility

determinations or weighing the evidence.” Czekalski v. Peters, 475 F.3d 360, 363 (D.C. Cir.



                                                   4
2007). All underlying facts and inferences must be analyzed in the light most favorable to the

non-movant. See Anderson, 477 U.S. at 255. Nevertheless, conclusory assertions offered

without any evidentiary support do not create a genuine issue for trial. See Greene v. Dalton,

164 F.3d 671, 675 (D.C. Cir. 1999).

                                         IV. ANALYSIS

       1. Tax Refund Claim

       Defendant argues that Plaintiff’s enrollment in Blue Cross Blue Shield Federal Employee

Program disqualified her for a refund under the HCTC for tax years 2014 and 2015. See Def’s

Mem. at 6-7. The Court agrees. Under the statute, “eligible coverage month” for purposes of

qualifying for a credit “means” the first day of “any month” where the taxpayer “does not have

other specified coverage[.]” 26 U.S.C. § 35(b)(1)(A)(iii) (emphasis added). Specified coverage

includes “a health benefits plan under chapter 89 of title 5, United States Code,” id., § 35(f)

(3)(A), which is “the Federal Employees Health Benefits Act of 1959 (FEHBA), 5 U.S.C. § 8901

et seq.” Coventry Health Care of Missouri, Inc. v. Nevils, 137 S. Ct. 1190, 1194 (2017).

       Plaintiff does not dispute that OPM’s survivor annuity payments were her only source of

income in 2014 and 2015 and that she was enrolled in the federal health insurance program

during those tax years. Consequently, Defendant is entitled to judgment as a matter of law on

Plaintiff’s claim for a tax refund.

       2. Monetary Damages Claim

       Plaintiff seeks punitive damages “for all the hell that [defendants] took” her through

“when they knew” that she was “entitle[d] to the Health Care Tax Credit.” 4 Compl. at 3. The



4
  Plaintiff seems to allege that she “received” a “health care tax credit refund” in 2016 and 2017
and therefore is entitled to a refund for tax years 2014 and 2015. Compl. at 3. Defendant counters
that to the extent the allegation is true, such “refunds were erroneous” because “[i]t appears that
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false premise notwithstanding, an award of damages would be against the United States, and

“[a]bsent a waiver, sovereign immunity shields the Federal Government and its agencies from

suit.” FDIC v. Meyer, 510 U.S. 471, 475 (1994); see accord American Road & Transp. Builders

Ass’n v. EPA, 865 F. Supp. 2d 72, 79 (D.D.C. 2012). Congress may waive the government’s

immunity, but such a waiver “must be unequivocally expressed in statutory text, and will not be

implied.” Lane v. Pena, 518 U.S. 187, 192 (1996) (citations omitted); see also United States v.

Mitchell, 463 U.S. 206, 212 (1983) (“It is axiomatic that the United States may not be sued

without its consent and that the existence of consent is a prerequisite for jurisdiction.”).

       Defendant argues that Plaintiff’s claim for damages should be dismissed because she

failed to exhaust her administrative remedies under the Taxpayer Bill of Rights by following the

procedures set out at 26 U.S.C. § 7433(d)(1). Def.’s Mem. at 7-8. But the D.C. Circuit has

“limited § 7433’s reach to situations in which the IRS has ‘tak[en] an affirmative step to recover’

taxes owed to the government.” Ivy v. Comm’r of Internal Revenue Serv., 877 F.3d 1048, 1050

(D.C. Cir. 2017) (quoting Agility Network Servs., Inc. v. United States, 848 F.3d 790, 794 (6th

Cir. 2017); see id. (citing with approval Gonsalves v. IRS, 975 F.2d 13, 16 (1st Cir. 1992),

holding that a “claim for damages resulting from the government’s refusal to give [the plaintiff]

a tax refund runs afoul of the clause in Section 7433 which says that a taxpayer may sue only if

an IRS agent disregards a statute or regulation ‘in connection with any collection of Federal

tax’”); see also Jaeger v. U.S. Gov’t, 524 F. Supp. 2d 60, 63-64 (D.D.C. 2007) (holding that

“section 7433 does not provide a cause of action for wrongful tax assessment, the absence of a

tax assessment, or other actions not related to the collection of income tax”) (citing cases holding




[Plaintiff’s] health insurance in 2016 and 2017 was also Blue Cross Blue Shield’s Federal
Employee Plan.” Mem. at 7, n.2.
                                                  6
same)). Plaintiff’s claim, to the extent intelligible, is based not on the collection of taxes but

on the alleged theft of her tax refund through fraudulent means by federal employees. Pl.’s Sur-

reply at 5. Therefore, the government’s invocation of § 7433’s immunity waiver is inapposite.

       The Federal Tort Claims Act (“FTCA”), 28 U.S.C. §§ 2671-80, waives the United States’

immunity as to certain enumerated claims for money damages. It “‘mak[es] the Federal

Government liable to the same extent as a private party for certain torts of federal employees

acting within the scope of their employment[,]’” Bell v. United States, 301 F. Supp. 3d 159, 163

(D.D.C. 2018), aff'd, No. 18-5115, 2018 WL 6720681 (D.C. Cir. Dec. 17, 2018) (quoting United

States v. Orleans, 425 U.S. 807, 813 (1976)), “in accordance with the law of the place where the

act or omission occurred.” 28 U.S.C. § 1346(b)(1).

       The FTCA explicitly immunizes the United States from “[a]ny claim arising in respect of

the assessment or collection of any tax[.]” 28 U.S.C. §2680(c). Courts have found this

language “broad enough to encompass any activities of an IRS agent [or employee] even

remotely related to his or her official duties.” Childresss v. Northrop Corp., 618 F. Supp. 44, 49

(D.D.C. 1985) (quoting Capozzoli v. Tracey, 663 F.2 654, 658 (5th Cir. 1981) (other citations

omitted)); see Reiff v. United States, 107 F. Supp. 3d 83, 87-88 (D.D.C. 2015) (rejecting

argument that immunity extends only to conduct of “IRS ‘agents’”); see also Clark v. United

States, 326 F.3d 911, 913-14 (7th Cir. 2003) (examining cases from “other circuits” that “have

held that a wide range of activity by the IRS ‘arises in respect of’ its collection or assessment of

taxes”). Consequently, Plaintiff’s claim for punitive damages is barred.

                                          CONCLUSION

       For the foregoing reasons, the Court concludes that no reasonable jury could find that

Plaintiff is owed a tax refund for tax years 2014 and 2015, and that sovereign immunity bars



                                                  7
Plaintiff’s claim for monetary damages. Therefore, summary judgment will be entered in the

government’s favor on both claims. A separate order accompanies this Memorandum Opinion.


                                           ________/s/____________
                                           RUDOLPH CONTRERAS
DATE: March 19, 2020                       United States District Judge




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