Cobai v. United States of America

Background

The court had previously dismissed pro se plaintiff Gregory Cobai’s original complaint for lack of subject-matter jurisdiction because he had not adequately shown that he filed a proper administrative claim with the Internal Revenue Service before suing. The court previously determined that the alleged refund claims did not adequately explain the basis for Cobai’s objections to the tax assessments and were not verified by a declaration made under penalty of perjury. The court also dismissed a collections-related claim because the complaint did not identify a statutory basis for relief or allege that Cobai met the requirements for a damages claim under 26 U.S.C. § 7433. The dismissal allowed Cobai to amend, and he filed a first amended complaint.

Amended Complaint

The amended complaint was, in substance, virtually identical to the original complaint. Cobai alleged that the IRS lacked evidence or facts showing that the Internal Revenue Code applied to him, that the IRS had jurisdiction over him, or that he was obligated to pay money to the IRS. The defendants asked the court to dismiss under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6), which address subject-matter jurisdiction and failure to state a legally sufficient claim.

The court determined that the alleged refund claim did not specifically identify a factual or legal basis for contesting Cobai’s tax liability. It said that questioning the IRS’s authority to tax Cobai, without more, did not establish grounds for suing the IRS.

For Count II, Cobai sought a refund of garnished wages. The court stated that 26 U.S.C. § 7433 provides the exclusive civil remedy for damages resulting from improper collection activity, subject to its own exhaustion and timing requirements. The court said Cobai had not demonstrated compliance with those requirements. It also noted that the amended complaint alleged improper collection activity in 2018, while the action was not filed until April 5, 2023, after the two-year limitations period had expired.

Ruling

The court said Cobai had been given multiple opportunities to establish jurisdiction and plausibly allege a claim. It reviewed the pleadings under the generous reading afforded to a self-represented litigant but concluded that further amendment was not warranted. Judge James Donato dismissed the complaint with prejudice.