United States Court of Appeals
For the First Circuit
No. 06-2037
MARLENE JOHANSEN,
Plaintiff, Appellant,
v.
UNITED STATES,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Reginald C. Lindsay, U.S. District Judge]
Before
Howard, Circuit Judge,
Campbell, Senior Circuit Judge,
and Saris,* District Judge.
Timothy J. Burke with whom Burke & Associates was on brief for
appellant.
Kenneth W. Rosenberg, Attorney, Tax Division, with whom
Michael J. Sullivan, United States Attorney, Eileen J. O'Connor,
Assistant Attorney General, Bruce R. Ellisen and Laurie Snyder,
Attorneys, Tax Division, Department of Justice, were on brief for
appellee.
October 29, 2007
*
Of the District of Massachusetts, sitting by designation.
CAMPBELL, Senior Circuit Judge. Appellant Marlene
Johansen appeals from the dismissal of her suit in the United
States District Court for the District of Massachusetts to quiet
title on her property. The suit was dismissed for lack of
jurisdiction on mootness grounds, and Johansen argues that this was
error because she has suffered damages that must be redressed by
the government. After reviewing her arguments and the record, we
affirm the dismissal of her suit.
Background
On August 17, 2004, Johansen filed a complaint to quiet
her title to a residential property in Stoneham, Massachusetts.
She contended that a tax lien the United States had asserted
against her as nominee for her divorced ex-husband, Ralph Johansen,
for his delinquent income tax liabilities created a cloud on her
title, effected a detriment to her creditworthiness, and damaged
her. She also requested attorneys' fees under the Internal Revenue
Code, 26 U.S.C. § 7430, and the Equal Access to Justice Act, 28
U.S.C. § 2412(d). The government counterclaimed to foreclose the
tax lien against the Stoneham property by sale.
The district court initially had jurisdiction over
Marlene's action pursuant to 28 U.S.C. §§ 1331 and 1340 (general
jurisdictional statutes) and 2410 (which provides in relevant part
that "the United States may be named a party in any civil action or
suit . . . having jurisdiction of the subject matter (1) to quiet
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title to; (2) to foreclose a mortgage or other lien upon; (3) to
partition; (4) to condemn; or (5) of interpleader or in the nature
of interpleader with respect to real or personal property on which
the United States has or claims a mortgage or other lien"), and
over the government's counterclaim under 28 U.S.C. §§ 1340, 1345
and IRC § 7403. During the course of the litigation, however, on
August 22, 2005, Ralph Johansen paid in full his tax liabilities.
As a result, on September 20, 2005, the government filed a motion
to dismiss the action on the grounds that it no longer had any
interest in the Stoneham property since full payment of its tax
claim had been made. Thus, the government argued, the issue raised
in Johansen's suit was moot, there no longer being any occasion to
quiet title, and the court being without jurisdiction to decide
anything more. Marlene Johansen opposed the motion to dismiss on
the grounds that the government's lien on her property had been
wrongfully imposed from the start,1 that she had suffered damages,
and that she was entitled to attorneys' fees.
On February 9, 2006, the magistrate judge recommended
dismissing the case as moot. On the same day, the government filed
1
Marlene Johansen had received the property from her ex-
husband as part of the divorce settlement. In its counterclaim the
government asserted that its unrecorded lien against Ralph's
interest in the Stoneham property was valid against Marlene and
that the conveyance to her was fraudulent. Marlene contends that
upon coming to her, the property was no longer subject to the
government's claim for taxes owed by her ex-spouse and that the
government's subsequent filing of a lien on her property was
therefore improper.
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with the court documents demonstrating that, on February 8, 2006,
it had officially withdrawn notice of the lien on Ralph Johansen's
tax liabilities. Marlene Johansen filed objections to the
recommendation, arguing that she was nonetheless entitled to have
the court find that the tax lien had been wrongly placed on her
property, and that the government's release of the lien did not
alter the fact that, from the time filed until its release, the
lien was improper and had injured her by undermining her
creditworthiness.
The district court endorsed the recommendation of the
magistrate judge that because the government no longer had an
interest in the property, the case was moot, and that Johansen's
other allegations and her interest in attorneys' fees were
insufficient to maintain a live controversy. This timely appeal
followed.
Discussion
On appeal, Marlene Johansen argues that her claim is not
moot, relying on the same cases which the district court's ruling
properly distinguished. We will discuss her argument infra. As a
preliminary matter, the government argues that the appellant failed
to preserve the issues she raises here on appeal as she did not
specifically indicate them in her objections below to the
magistrate judge's report and recommendations. Johansen's
objections were, indeed, vague, but as the points she now raises
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are clearly without merit, we need not go into the issue of their
preservation. Instead, we address her appellate claims on the
merits.
As we explain infra, when the government ceased to have
an interest in the Stoneham property because the tax liabilities
had been paid, Johansen's suit to quiet title to that property
became moot. The only remedy to which she had been entitled under
28 U.S.C. § 2410, which was the statutory basis of her suit, was
removal of the lien, and that removal was accomplished, leaving the
court with nothing to do. While Johansen alleged in her complaint
that the lien affected her creditworthiness and damaged her, these
claims, standing alone, were outside the province of § 2410, hence
beyond the subject matter jurisdiction of the court and leaving
them barred by the government's sovereign immunity.
The district court's legal conclusion on the motion to
dismiss for lack of jurisdiction is reviewed by us de novo. Gill
v. United States, 471 F.3d 204, 205 (1st Cir. 2006). When a
defendant moves to dismiss for lack of federal subject matter
jurisdiction, "'the party invoking the jurisdiction of a federal
court carries the burden of proving its existence.'" Murphy v.
United States, 45 F.3d 520, 522 (1st Cir.), cert. denied, 515 U.S.
1144 (1995) (quoting Taber Partners, I. v. Merit Builders, Inc.,
987 F.2d 57, 60 (1st Cir.), cert. denied, 510 U.S. 823 (1993)). We
have held that the party advocating jurisdiction must make clear
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the grounds on which the court may exercise jurisdiction: "it is
black-letter law that jurisdiction must be apparent from the face
of the plaintiffs' pleading." PCS 2000 LP v. Romulus Telecomms.,
Inc., 148 F.3d 32, 35 (1st Cir. 1998). If the party fails to
demonstrate a basis for jurisdiction, the district court must grant
the motion to dismiss. Though we take as true the well-pleaded
facts of the complaint, Santa-Rosa v. Combo Records, 471 F.3d 224,
226 (1st Cir. 2006), a plaintiff cannot rest a jurisdictional basis
"merely on 'unsupported conclusions or interpretations of law.'"
Murphy, 45 F.3d at 422 (quoting Washington Legal Foundation v.
Massachusetts Bar Foundation, 993 F.2d 962, 971 (1st Cir. 1993)).
i. Availability of Damages
Johansen argues that the mere fact that the United States
no longer claimed an interest in the property on which the lien had
been placed did not make the controversy moot. She opposed the
government's motion to dismiss below by arguing,
The United States' motion does not provide a basis for
its conclusion that [the removal of the lien] adequately
addressed the allegations and relief sought from the
Court in [plaintiff's] complaint. The issue before the
Court remains as to whether the United States had legal
justification for the filing of the nominee lien, and if
the Court finds none, the extent of damages caused to Ms.
Johansen by its erroneous filing. . . . Ms. Johansen's
Complaint properly alleges that her creditworthiness was
damaged by the filing of the unlawful lien. Her matter
addresses the injury she suffered. Her matter is not
moot.
As already noted, Johansen asserted jurisdiction under general
jurisdictional statutes, 28 U.S.C. §§ 1331 and 1340, and under 28
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U.S.C. § 2410. As the magistrate judge found, any claim of
jurisdiction for the purpose of enabling plaintiff to recover money
damages for alleged detriment to the plaintiff's creditworthiness
fails because § 2410 provides for federal court subject matter
jurisdiction and for an implicit waiver of the United States'
sovereign immunity only for the adjudication of an equitable action
to quiet title, and not an action for money damages. Kulawy v.
United States, 917 F.2d 729, 736 (2d Cir. 1990) ("in a § 2410
action, only equitable relief affecting title, and not damages, may
be awarded").
ii. Mootness
In finding mootness, the magistrate judge relied on Lewis
v. Continental Bank Corporation, 494 U.S. 472, 477 (1990), in which
the Supreme Court set out the definition of a live controversy
under Article III:
Under Article III of the Constitution, federal courts may
adjudicate only actual, ongoing cases or controversies.
To invoke the jurisdiction of a federal court, a litigant
must have suffered, or be threatened with, an actual
injury traceable to the defendant and likely to be
redressed by a favorable judicial decision. Article III
denies federal courts the power to decide questions that
cannot affect the rights of litigants in the case before
them, and confines them to resolving real and substantial
controversies admitting of specific relief through a
decree of a conclusive character, as distinguished from
an opinion advising what the law would be upon a
hypothetical set of facts. This case-or-controversy
requirement subsists through all stages of federal
judicial proceedings, trial and appellate.
Id. (internal citations and quotations omitted).
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Johansen argues that the question of whether the
government was right to place a tax lien on her property amounts to
a still valid ongoing controversy. She says she suffered actual
injury as a result of the wrongful lien and seeks resolution of her
challenge to the lien as a necessary condition to her becoming a
prevailing party entitled to attorneys' fees under 26 U.S.C. §
7430. The magistrate judge rightly found that Johansen's position
could not be sustained. First, the distinction between a
"conclusive decree" and an "advisory opinion" was reiterated in
Rhodes v. Stewart:
The real value of the judicial pronouncement--what makes
it a proper judicial resolution of a 'case or
controversy' rather than an advisory opinion--is in the
settling of some dispute which affects the behavior of
the defendant towards the plaintiff.
488 U.S. 1, 4 (1988) (quoting Hewitt v. Helms, 482 U.S. 755, 761
(1987)) (emphasis in original). Here, the magistrate judge
concluded, "the desired modification of behavior underlying the
plaintiff's complaint, the removal of the defendant's lien on the
subject property, has already been accomplished. Any further
judicial pronouncements would be without 'real value.'"2 In saying
2
When the government filed its motion to dismiss, it had
argued that as a result of Ralph Johansen's payment of his tax
liabilities, "[t]he United States will release all liens against
Ralph Johansen, including those liens naming Marlene Johansen as
the nominee of Ralph Johansen. The United States, therefore,
claims no interest in the subject property, and moves to dismiss
this action because there is no controversy to adjudicate." In her
opposition to the motion to dismiss, Johansen did not dispute the
fact that the tax liabilities underlying the lien had been
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the latter, the magistrate judge reiterated what is clear: that no
matter what damages plaintiff may feel she has suffered as a result
of the lien, "no specific relief through a decree of a conclusive
character," as distinguished from a mere advisory opinion, is
presently possible in this litigation. Lewis, 494 U.S. at 477.
Second, the Supreme Court has concluded that the desire
for attorney's fees is insufficient to maintain Article III
jurisdiction:
At the time Continental's challenge to denial of its
application for an insured ISB was mooted by the
amendments to the BHCA, this litigation had been in
progress for almost seven years. An order vacating the
judgment on grounds of mootness would deprive
Continental of its claim for attorney's fees under 42
resolved. Following the magistrate judge's report and
recommendation to dismiss the complaint, the government filed
documents showing that on February 8, 2006 (the day before the
report and recommendation issued), the government withdrew three
notices of federal lien related to the liabilities of Ralph
Johansen. According to the language of I.R.C. § 6322, a lien
continues "until the liability for the amount so assessed (or a
judgment against the taxpayer arising out of such liability) is
satisfied or becomes unenforceable by reason of lapse of time"
(emphasis supplied). Johansen did not in either her objection to
the report and recommendation or her initial appellate brief raise
any objection to the fact that the formal paperwork withdrawing
notice of the lien was not filed until February 8, 2006. In her
reply brief, however, she takes issue with the timing of the
withdrawal of the lien notice, arguing that "the finding of
mootness was made without evidence that the matter was moot." Even
if the withdrawal of the lien notice was integral to the mootness
of the controversy, and even if Johansen had raised this argument
in a timely fashion instead of in her reply brief, the "case-or-
controversy requirement subsists through all stages of federal
judicial proceedings, trial and appellate." Lewis, 494 U.S. at
477. At the time the district court approved the report and
recommendation, there was no lien against Johansen's property and
thus no need to quiet the title on it.
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U.S.C. § 1988 (assuming, arguendo, it would have such a
claim), because such fees are available only to a party
that "prevails" by winning the relief it seeks. This
interest in attorney's fees is, of course, insufficient
to create an Article III case or controversy where none
exists on the merits of the underlying claim. Where on
the face of the record it appears that the only concrete
interest in the controversy has terminated, reasonable
caution is needed to be sure that mooted litigation is
not pressed forward, and unnecessary judicial
pronouncements . . . obtained solely in order to obtain
reimbursement of sunk costs.
Lewis, 4984 U.S. at 480 (internal citations omitted). See also
Buckhannon Bd. & Care Home, Inc. v. W.V. Dep't of Health & Human
Resources, 532 U.S. 598, 605 (2001) (holding that the term
"prevail" denotes "a judicially sanctioned change in the legal
relationship of the parties"). We have held that "Buckhannon is
presumed to apply generally to all fee-shifting statutes that use
the 'prevailing party' terminology." The situation here, as the
magistrate judge pointed out, is parallel to Lewis in that the
concrete interest in the controversy has terminated with the
removal of the tax lien from the property. To be sure, plaintiff
may feel a dispute still lingers over the United States' legal
justification for filing the lien in the first place. Section
2410, however, makes no provision for adjudicating such a question
now that the lien no longer exists, leaving the court without
jurisdiction to do so. And this Circuit has recently held that a
"litigant's interest in a possible award of attorney's fees is not
enough to create a justiciable case or controversy if none exists
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on the merits of the underlying claim." Goodwin v. C.N.J., Inc.,
436 F.3d 44, 51 (1st Cir. 2006).
Johansen cites on appeal two additional cases as
supporting her argument, Rainey v. Jackson State College, 481 F.2d
347 (6th Cir. 1973) and Education/Instruccion, Inc. v. United
States, 471 F. Supp. 1074 (D. Mass. 1979). Neither case, however,
even assuming their applicability, lends persuasive support to
plaintiff's position here, since both have since been superceded by
the Supreme Court's decision in Buckhannon. See also Oil, Chemical
& Atomic Workers Int'l Union v. Dep't of Energy, 288 F.3d 452, 455
(D.C. Cir. 2002) (existing case law must give way to the extent it
does not require a plaintiff to have "been awarded some relief by
[a] court" to become eligible for fees).
In the absence of any federal remedy under the statutory
provisions plaintiff relies upon, we must affirm the judgment of
the district court. AFFIRMED.
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