Cohen v. United States, 397 U.S. App. D.C. 33

IRS levied a 3% excise tax on long-distance telephone calls; taxpayers argued the tax was inapplicable where charges were time-based rather than distance-based.
IRS issued Notice 2005-79 continuing collection and refund claims as placeholders while related circuit courts decided the issue.
Notice 2006-50 created a one-time refund mechanism for overpayments (Feb 28, 2003–Aug 1, 2006) with refunds processed via individual tax returns; later notices refined procedures.
Appellants Cohen, Sloan, and Gurrola filed MDL tax refund challenges alleging the notice and refund regime were unlawful; district court dismissed for lack of exhaustion and non-justiciability.
Panel reversed, holding Notice 2006-50 was final agency action reviewable under the APA and that the I.R.S.’s refund framework could be attacked in court.
En banc review addressed jurisdiction under the AIA and DJA, whether APA §702 waives sovereign immunity, and whether Appellants’ APA claim is ripe or exhaustible.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does APA §702 waive sovereign immunity for an injunctive/declaratory APA challenge?	Cohen argues §702 allows equitable relief against the IRS for non-monetary relief.	IRS contends AIA/DJA limit review and bar equity, so §702 does not waive immunity here.	Yes; §702 waives sovereign immunity for non-monetary APA claims here.
Do AIA and DJA operate as limitations on review of this APA action?	Appellants seek to circumvent by APA review, arguing DJA/AIA do not bar equitable relief.	IRS urges coterminous reading of AIA and DJA bars equitable relief that would affect tax matters.	No; the APA allows review, and neither AIA nor DJA bars the relief in this context.
Is Appellants’ APA claim ripe for review without exhausting refund procedures?	Ripeness is satisfied because the refund mechanism is unlawful and exhaustions not required for adequacy of procedures.	Ripeness requires exhaustion through refund claims and delay to be justified.	Appellants’ claim is ripe; exemption from exhaustion applies here because the administrative remedy is allegedly unlawful.
Is the refund-remedy under §7422(a) an adequate remedy at law that bars this APA action?	Refund suits are inadequate for class-wide equitable relief; APA relief should be available.	Refund suits provide an adequate forum for challenges to the refund rules and preclude APA action.	Refund suits are an adequate remedy; therefore the APA action must be dismissed or not allowed to proceed.

Bob Jones Univ. v. Simon, 416 U.S. 725 (1974) (AIA prohibits suits to restrain tax collection; refunds are proper forum)
Hibbs v. Winn, 542 U.S. 88 (2004) (DJA tax-exemption; limits of tax-related relief and final agency action)
South Carolina v. Regan, 465 U.S. 367 (1984) (refunding mechanisms and adequacy of alternative forums for tax challenges)
Abbott Laboratories v. Gardner, 387 U.S. 136 (1967) (ripeness and reviewability of agency regulations)
National Park Hospitality Ass'n v. Dep't of Interior, 538 U.S. 803 (2003) (ripeness and the immediacy of regulatory impact on compliance)
Tomlinson v. Smith, 128 F.2d 808 (7th Cir.1942) (DJA tax exemption and scope of tax-related declaratory relief)
Clintwood Elkhorn Mining Co., 553 U.S. 1 (2008) (clarifies refund-suit framework with respect to AIA/§7422(a))
Foodservice & Lodging Inst. v. Regan, 809 F.2d 842 (D.C. Cir. 1987) (equitable relief available in tax context; exhaustion not always required)
"Americans United" Inc. v. Americans United, 416 U.S. 752 (1974) (DJA scope and coterminous reading with AIA)
Williams Packing Co. v. United States, 370 U.S. 1 (1962) (AIA purpose to protect revenue collection; injunctive relief context)