Davis v. Internal Revenue Service

Background

Willie Davis, identified as a state prisoner in Texas, filed a civil action against the Internal Revenue Service. He proceeded without a lawyer and had permission to proceed without paying the filing fee. Davis said he had not received his economic-impact payments and asked the court to require the Internal Revenue Service to provide them under the Coronavirus Aid, Relief, and Economic Security Act, commonly called the CARES Act.

Screening standard

Because Davis was a prisoner suing a governmental entity, the court conducted the preliminary review required by 28 U.S.C. § 1915A. That review requires dismissal of claims that are frivolous, malicious, fail to state a legally sufficient claim, or seek money from a defendant protected from such relief. The court also noted that complaints filed without a lawyer are read generously, but they still must include enough factual allegations to make the requested relief plausible.

The CARES Act and the earlier class action

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

The court discussed an earlier related class action that addressed the Internal Revenue Service’s policy of treating incarcerated people as ineligible for the payments. In that class action, the court declared that the statute did not allow the payments to be withheld solely because a person was or had been incarcerated, and found that the Internal Revenue Service’s policy was arbitrary, capricious, and not in accordance with law. The earlier court ordered the agency to reconsider payments denied solely for that reason, but expressly did not decide whether particular people were owed payments or how much they should receive.

Reasoning

The court determined that Davis was a member of the earlier certified class. To the extent he claimed that his payments were denied because he was incarcerated, the court held that he was not entitled to separate individual relief duplicating the class action. The court stated that class members must pursue additional action through the class representative and attorney, including possible enforcement proceedings or intervention in the class action.

The court separately rejected Davis’s request to compel payment under the earlier class action or the CARES Act. The earlier class action did not establish that every incarcerated person was owed a payment; it required the Internal Revenue Service to make individual eligibility determinations. In addition, the statutory deadline for issuing or allowing the payments had passed, so the court concluded that Davis could not obtain the relief he requested in this case.

Disposition

The court found that Davis failed to state a claim for relief. It dismissed the complaint without leave to amend because it concluded that no amendment could correct the identified problems. The court then dismissed the action with prejudice and directed the clerk to close the case. Judge Phyllis J. Hamilton signed the order.