FILED
NOT FOR PUBLICATION NOV 02 2010
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 08-56929
Petitioner - Appellee, D.C. No. 2:07-cv-08395-GHK-SH
v.
MEMORANDUM *
EVELYN CATHCART,
Respondent - Appellant.
Appeal from the United States District Court
for the Central District of California
George H. King, District Judge, Presiding
Argued and Submitted October 6, 2010
Pasadena, California
Before: CUDAHY,** Senior Circuit Judge and WARDLAW and W.
FLETCHER, Circuit Judges, .
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The Honorable Richard D. Cudahy, Senior United States Circuit
Judge for the Seventh Circuit, sitting by designation.
Taxpayer Evelyn Cathcart appeals the district court’s order enforcing seven
IRS summonses for records. See 26 U.S.C. § 7602(a)(2). We have jurisdiction
under 28 U.S.C. § 1291 and we affirm.
The district court correctly concluded that it had subject matter jurisdiction
under 26 U.S.C. §§ 7402(b) and 7604(a), and that venue was proper under those
provisions, because Cathcart was “found” in the Central District of California
when she was personally served there with the petition to enforce the summonses
and the district court’s order to show cause. The district court also correctly
determined that the government satisfied its burden for enforcement by introducing
Revenue Agent Jaya Balu’s sworn declaration attesting to compliance with the
requirements of United States v. Powell, 379 U.S. 48, 57-58 (1964). See Stewart v.
United States, 511 F.3d 1251, 1254 (9th Cir. 2008). We reject Cathcart’s argument
premised on United States v. Jose, 131 F.3d 1325 (9th Cir. 1997) (en banc), that
the district court lacked the authority to modify the summonses to permit Cathcart
to produce the requested documents by mail rather than by personal appearance.
Jose holds that a district court may not conditionally enforce a summons by
restricting the IRS’s use of the summoned material. Id. at 1329. Here, the district
court changed only the manner in which Cathcart was to comply; the court limited
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neither the investigative scope of the summonses nor the IRS’s ability to use the
material sought.
We also agree with the district court that Cathcart’s speculative claims of
bad faith and harassment – most of which pertain to the IRS’s investigation of her
husband Charles – do not carry her “heavy burden” of showing that the IRS issued
the summonses for an illegitimate purpose. See United States v. Stuckey, 646 F.2d
1369, 1372 (9th Cir. 1981). The district court did not abuse its discretion by
refusing Cathcart’s request for an evidentiary hearing. Even taken as true, the
declarations submitted by Cathcart establish at most that the IRS missed two
scheduled appointments with Charles Cathcart and did not respond to several
communications from Evelyn Cathcart. Such conduct does not rise to the
“disruptive” and “damag[ing]” level that we have held to require a hearing in the
past. See, e.g., United States v. Samuels, Kramer & Co., 712 F.2d 1342, 1347 (9th
Cir. 1983).
Nonetheless, we note the troubling nature of the IRS’s conduct. The IRS
addressed the summonses to Cathcart at a residence in Tuxedo Park, N.Y., and
served Cathcart at that residence in May 2006, but the summonses demanded that
Cathcart appear personally in San Francisco, Calif., to produce the requested
records. Two weeks after Cathcart was served with the summonses, her accountant
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Charles Bailin faxed a letter to the issuing officer, Revenue Agent Marie Allen,
suggesting that Cathcart should be allowed to produce the records by mail rather
than in person. Bailin states that he followed up with phone calls and a second
letter to Allen, but received no response. Instead, the IRS brought this enforcement
action in December 2007. The IRS eventually conceded, in August 2008, that
Cathcart could comply with the summonses by mailing the requested records to
Allen. Contrary to the government’s claim that Cathcart could have complied with
the summonses at the time of issuance “simply by mailing the summoned
documents to the IRS office in San Francisco,” the summonses clearly require
Cathcart “to appear” before Revenue Agent Allen in San Francisco. The
government’s memorandum in support of its petition to enforce the summonses
asked the district court to issue an order “compelling Respondent to appear before
an authorized representative of the IRS at a time and place to be determined by the
IRS.”
If production of the summoned records by mail sufficed, the IRS should
have accepted Cathcart’s offer in 2006, instead of consuming scarce agency and
judicial resources in this litigation. By the same token, we note that we do not
understand why Cathcart did not take up the IRS’s belated invitation to comply by
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mail in August 2008, choosing to litigate instead. In any event, the district court’s
order is affirmed.
AFFIRMED.
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