71 F. Supp. 3d 219
D.D.C.2014Background
- True the Vote (TTV), a nonprofit, applied for 501(c)(3) tax-exempt status in July 2010; its application experienced prolonged inquiries and delays by IRS offices (Cincinnati and Washington), which TTV alleges were part of an unlawful “targeting scheme” aimed at Tea Party–associated groups.
- TTV submitted repeated additional materials in 2011–2012; Treasury Inspector General and IRS internal materials later identified inappropriate criteria and that the review process was suspended in mid-2013.
- TTV filed suit (May 2013, amended July 2013) asserting five counts: (1) declaratory relief re: tax-exempt status; (2) First Amendment violation and injunctive relief; (3) Bivens monetary damages against individual IRS officials; (4) violations of 26 U.S.C. § 6103 (unauthorized inspection/disclosure); and (5) APA violations.
- After suit was filed, the IRS granted TTV tax-exempt status (Sept. 26, 2013) and announced suspension/remedial steps regarding the targeting practices; the IRS also produced public reports identifying inappropriate criteria.
- The court resolved multiple motions to dismiss: it dismissed all five counts (Counts 1, 2, 5 for lack of subject-matter jurisdiction as moot; Count 3 for failure to state a Bivens claim; Count 4 for failure to state a §6103 claim) and denied TTV’s motion to stay agency action as moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Mootness of Counts 1, 2, 5 (declaratory, First Amendment injunction, APA) | TTV: controversy remains because court should declare the IRS targeting scheme unlawful and enjoin ongoing implementation | Defs: IRS granting TTV tax-exempt status and suspending the scheme eradicates the injury; case is moot | Counts 1, 2, 5 are moot; dismissal for lack of subject-matter jurisdiction |
| Voluntary cessation exception to mootness | TTV: IRS could resume targeting; suspension and approval are insufficient | Defs: government suspension, remedial steps, and grant of status remove reasonable expectation of recurrence; heavy burden to show recurrence | Voluntary cessation exception inapplicable; prospective harm speculative and different from pleaded harm |
| Count 3 — Bivens damages against individual IRS officials | TTV: constitutional violations (First Amendment) by individual officials warrant Bivens damages | Defs: Bivens remedy inappropriate here due to comprehensive statutory remedial scheme and Circuit precedent; alternative remedies exist | No extension of Bivens; Count 3 dismissed with prejudice for failure to state a claim |
| Count 4 — §6103 (unauthorized inspection/disclosure) | TTV: IRS requested unnecessary information and inspected it for non-tax-administration purposes, violating §6103/§7431 | Defs: §6103 governs handling (inspection/disclosure) of return information; acquisition/collection methods do not create §6103 liability; remedies for application-related disputes lie elsewhere | §6103 claim dismissed: plaintiff failed to plead improper inspections/disclosures; alleged improper acquisition is not cognizable under §6103 here |
Key Cases Cited
- Bivens v. Six Unknown Named Agents of Fed. Bureau of Narcotics, 403 U.S. 388 (1971) (recognized implied damages remedy against federal officers for constitutional violations)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (standing requires concrete and imminent injury)
- Qassim v. Bush, 466 F.3d 1073 (D.C. Cir. 2006) (voluntary cessation exception standards to mootness)
- Kim v. United States, 632 F.3d 713 (D.C. Cir. 2011) (declining to create Bivens remedy against IRS employees given comprehensive statutory scheme)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard requiring plausibility; conclusory allegations not credited)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state a plausible claim for relief)
- Spagnola v. Mathis, 859 F.2d 223 (D.C. Cir. 1988) (comprehensive statutory scheme may be a special factor counseling against recognizing Bivens remedies)
- United States v. W.T. Grant Co., 345 U.S. 629 (1953) (defendant bears heavy burden to show no reasonable expectation of recurrence when invoking voluntary cessation)
- Newdow v. Roberts, 603 F.3d 1002 (D.C. Cir. 2010) (mootness doctrine bars adjudication where no live controversy exists)