951 F. Supp. 2d 45
D.D.C.2013Background
- Plaintiff Mihretu Bulti Dasisa alleges the Department of the Treasury (DOT) improperly offset part of his tax refund to satisfy a debt asserted by the Department of Education.
- Under 31 U.S.C. §§ 3711(g) and 3716(a) DOT performs offsets when an agency refers a debt and forwards withheld funds to that agency. Agencies certify debts as valid and enforceable under 31 C.F.R. § 285.5(d)(6).
- Plaintiff filed suit against DOT seeking declaratory relief and to challenge the offset.
- DOT moved to dismiss for lack of subject matter jurisdiction under Fed. R. Civ. P. 12(b)(1), citing 26 U.S.C. § 6402(g), which bars suits to restrain or review certain tax refund reductions carried out under subsection (d).
- The statute preserves a plaintiff’s ability to sue the referring agency directly but strips courts of jurisdiction to review DOT’s ministerial offset actions.
- The Court granted DOT’s motion to dismiss, denied all of plaintiff’s motions, and dismissed the case with prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court has jurisdiction to review DOT’s offset of plaintiff’s tax refund | Dasisa contends the offset was improper and seeks judicial relief against DOT | DOT contends 26 U.S.C. § 6402(g) deprives courts of jurisdiction to hear suits challenging such offsets against the Treasury | Court held it lacks jurisdiction under § 6402(g); dismissal granted |
| Whether DOT is a proper defendant for challenging the underlying debt | Dasisa sued DOT to recover/refund the offset amounts | DOT argued it is only the federal collector acting pursuant to a referring agency’s certification; § 6402(g) precludes suits against DOT but not against the referring agency | Court held DOT is the wrong defendant; plaintiff must sue the agency claiming the debt |
| Whether plaintiff’s motions for declaratory/judgment or summary relief against DOT may proceed despite § 6402(g) | Plaintiff sought declaratory judgment and summary judgment against DOT | DOT asserted statutory bar precludes both legal and equitable relief against it | Court denied all plaintiff motions and dismissed the case |
| Effect of statutory reservation to sue the referring agency | Plaintiff urged relief from DOT to reach the debt issue | DOT noted § 6402(g) explicitly preserves actions against the agency that received the offsetted funds, not against DOT | Court reiterated plaintiff may pursue claims against the referring agency, not DOT |
Key Cases Cited
- Texas Alliance for Home Care Servs. v. Sebelius, 681 F.3d 402 (D.C. Cir. 2012) (statutory jurisdictional bars can overcome the Administrative Procedure Act’s presumption of judicial review)