Owens v. Department of Treasury

Background

Cody Lee Owens, a state prisoner in Texas proceeding without a lawyer, brought a civil action against the Department of Treasury. He had permission to proceed without paying the filing fee. Owens sought court intervention to obtain economic impact payments under the Coronavirus Aid, Relief, and Economic Security Act, commonly called the CARES Act. He stated that he had not received his payments and asked the court to compel the Internal Revenue Service to provide them.

Screening standard

Because Owens was a prisoner suing a governmental entity, the court conducted the required preliminary screening under 28 U.S.C. § 1915A. That law requires dismissal of claims that are frivolous, malicious, fail to state a claim for relief, or seek money from a defendant immune from that relief. The court also noted that filings by people without lawyers must be read liberally, but a complaint still must contain enough factual allegations to make a claim plausible rather than merely speculative.

CARES Act and prior class case

The court explained that the CARES Act created a tax credit for eligible individuals and authorized advance economic impact payments. The statute provided that no refund or credit could be made or allowed under the relevant provision after December 31, 2020.

The court relied on an earlier class action, Scholl v. Mnuchin. In that case, the court certified a class that included qualifying United States citizens and lawful permanent residents who were or had been incarcerated, among other requirements. The court declared that the CARES Act did not allow the government to withhold payments solely because a class member was incarcerated and found that the government’s contrary policy was arbitrary and not lawful. The earlier court ordered the government to reconsider payments denied solely because of incarceration. It expressly did not decide whether any particular person was owed a payment or the amount of any payment.

Ruling

The court found that Owens was incarcerated and part of the Scholl class. To the extent he claimed that his payment was denied because of incarceration, the court held that he was not entitled to separate individual injunctive or equitable relief because that request duplicated the existing class action. The court explained that class members could pursue further action through the class representatives and attorneys, including contempt proceedings or intervention in the class case.

The court also rejected Owens’s request to compel payment under Scholl or the CARES Act. Scholl established that incarceration alone could not justify denying a payment, but it did not determine that every incarcerated person was individually owed a payment. The court stated that the Internal Revenue Service was responsible for making individual eligibility determinations. More importantly, the December 31, 2020 statutory deadline had passed, so the CARES Act could not support issuing additional payments.

The court concluded that Owens failed to state a claim for relief. It dismissed the complaint without leave to amend because no amendment could cure the identified problems. The conclusion states: “The action is DISMISSED with prejudice.” The clerk was ordered to close the case.