United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 8, 2016 Decided February 21, 2017
No. 15-7118
JOHN J. BOWMAN, JR.,
APPELLANT
v.
KIMBERLY IDDON, ET AL.,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 1:14-cv-00520)
Jennifer J. Clark, appointed by the court, argued the
cause as amicus curiae in support of appellant. With her on
the briefs was Jeffrey T. Green.
John J. Bowman Jr., pro se, was on the brief for
appellant.
Jonathan S. Cohen, Attorney, U.S. Department of Justice,
argued the cause for appellees. With him on the brief were
Gilbert S. Rothenberg and Gretchen M. Wolfinger, Attorneys.
2
Before: TATEL and WILKINS, Circuit Judges, and
GINSBURG, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge TATEL.
Concurring opinion filed by Circuit Judge TATEL, with
whom Senior Circuit Judge GINSBURG joins.
TATEL, Circuit Judge: Appellant John Bowman alleges
that five Internal Revenue Service (IRS) employees barred
him from representing taxpayers before the Service without
due process in violation of the Fifth Amendment. He seeks
damages under Bivens v. Six Unknown Named Agents of the
Federal Bureau of Narcotics, 403 U.S. 388 (1971). The
district court dismissed the case, concluding that the Internal
Revenue Code’s remedial scheme for tax practitioners
foreclosed a Bivens action. Without reaching that issue, we
affirm on the alternative ground that Bowman has failed to
state a claim under Federal Rule of Civil Procedure 12(b)(6)
because his complaint contains no allegation that Defendants
deprived him of a constitutionally protected interest.
I.
The Internal Revenue Service recognizes four primary
groups of individuals who prepare tax returns: certified public
accountants (CPAs), lawyers, enrolled agents, and unenrolled
preparers (“tax preparers”). See 31 C.F.R. § 10.8(a);
American Institute of Certified Public Accountants v. IRS, 804
F.3d 1193, 1194–95 (D.C. Cir. 2015). CPAs, lawyers, and
enrolled agents must be licensed, while tax preparers are
“subject to less stringent regulation.” American Institute, 804
F.3d at 1195. This case concerns a tax preparer.
As of 2005, IRS regulations permitted the first three of
these groups—all but tax preparers—to “practice before the
3
IRS.” See 31 C.F.R. §§ 10.2(d)–(e), 10.3(a)–(c) (2005). The
regulation then governing practice before the IRS, Circular
230, defined these groups as “practitioners” and permitted
them to act in “all matters connected with a presentation to
the [IRS] or any of its officers or employees relating to a
taxpayer’s rights, privileges, or liabilities,” including through
“filing documents,” “corresponding . . . with the IRS,” and
“representing a client at conferences.” Id. §§ 10.2(d)–(e),
10.3. Tax preparers, by contrast, could obtain only “limited
practice” authorization, which allowed them to represent
taxpayers before certain line officers of the IRS, excluding
“appeals officers, revenue officers, Counsel or similar officers
or employees.” Id. § 10.7(c)(1)(viii).
In 2011, “after an IRS review found problems in the tax-
preparation industry,” the Service issued a new rule governing
tax preparers. Loving v. IRS, 742 F.3d 1013, 1015 (D.C. Cir.
2013) (citing Regulations Governing Practice Before the
Internal Revenue Service, 76 Fed. Reg. 32,286 (June 3,
2011)). That rule created a new category of “registered tax
preparers,” who counted as “practitioners” obligated to
“register with the IRS by paying a fee and passing a
qualifying exam.” Id.; see 31 C.F.R. §§ 10.2(a)(5), 10.3(f),
10.4(c), 10.5(b) (2011). Under the rule, and except as
otherwise prescribed, only attorneys, CPAs, enrolled agents,
and registered tax preparers could “for compensation
prepare[] or assist[] with the preparation of all or substantially
all of a tax return or claim for refund.” 76 Fed. Reg. at
32,291; see 31 C.F.R. § 10.8(a) (2011); see also 26 C.F.R.
§ 301.7701-15 (2009) (“A tax return preparer is any person
who prepares for compensation, or who employs one or more
persons to prepare for compensation, all or a substantial
portion of any return of tax or any claim to refund of tax
under the Internal Revenue Code.”). This court invalidated
these regulations in Loving v. IRS, holding that tax-return
4
preparers fall outside the IRS’s statutory authority to regulate
“‘the practice of representatives of persons before the
Department of the Treasury.’” 742 F.3d at 1015 (quoting 31
U.S.C. § 330(a)(1)).
Enter appellant John Bowman. While working as a tax
preparer in June 2005, he pleaded guilty to mail fraud, wire
fraud, and money laundering, and was sentenced to fifty-
seven months’ incarceration. He began serving his sentence in
August 2005.
Three months later, while Bowman was still in prison,
Defendant Kimberly Iddon, an IRS Revenue Agent, submitted
a report of Bowman’s suspected misconduct to the IRS Office
of Professional Responsibility (OPR). The form on which
Iddon submitted the report required her to identify whether
Bowman was an attorney, CPA, enrolled agent, or enrolled
actuary. Though Bowman had never been an enrolled agent,
Iddon erroneously identified him as one, citing “personal
knowledge” and attaching newspaper articles on Bowman’s
prosecution. Bowman Mot. for Summ. J. at 21. None of those
articles, however, identify Bowman as an enrolled agent, and
Iddon never searched the IRS’s records to confirm Bowman’s
status.
A few weeks later, Iddon faxed Bowman’s IRS
Centralized Authorization File to an OPR paralegal. Although
the space on the form for “Enrollment Number” is empty,
someone handwrote the words “Enrolled Agent” at the bottom
of the page. Bowman Mot. for Summ. J. at 35. An IRS
official who has since searched the agency’s records reports
that she “did not find any record indicating that [Bowman]
was authorized to practice before the IRS as an enrolled
agent.” Rogers Decl. at 1.
5
OPR nonetheless initiated disciplinary proceedings to
suspend Bowman from doing what, as a tax preparer, he had
no authority to do: practice before the IRS. Due to a second
mistake by the IRS, Bowman received neither the complaint
that initiated those proceedings nor an opportunity to correct
the agency’s obvious error. Specifically, the Service mailed a
copy of the complaint to his business address, even though the
IRS knew Bowman was incarcerated and had forfeited his
business property to the government as restitution.
Unsurprisingly, the letter was returned undelivered.
A month later, OPR issued a “decision by default”
suspending Bowman. Decision – Complaint No. XP-2006-
067 at 1. That decision reads:
Effective this date, you are suspended from
eligibility to practice before the Internal Revenue
Service. Your suspension prohibits you from
engaging in practice before the Internal Revenue
Service as that term is defined in section 10.2(d) of
Circular 230.
Repeating its earlier mistake, OPR sent the letter to
Bowman’s former business address even though, as the IRS
well knew, Bowman remained incarcerated and the previous
letter had been returned undelivered.
The IRS then announced Bowman’s suspension in its
quarterly bulletin, as well as on a website listing disciplinary
actions for “Attorneys, Certified Public Accountants, Enrolled
Agents, and Enrolled Actuaries.” See Internal Revenue
Bulletin, 2006-18 I.R.B. 855, 869 (May 1, 2006). Defendant
Karen Copeland, an OPR manager, emailed more than twenty
people informing them that Bowman “ha[d] been suspended
from practice before the [IRS]” and “should not be recognized
6
as a taxpayer’s representative.” Bowman Mot. for Summ. J. at
49–50. She provided the information for “dissemination
throughout your organization as you deem appropriate.” Id. at
49.
Having left prison, and having received no
correspondence from the IRS, Bowman learned of OPR’s
disciplinary decision through a Freedom of Information Act
request in September 2011. By this time, the IRS had
promulgated the 2011 rule extending Circular 230 to tax
preparers. So on November 30, 2012, Bowman filed a petition
for reinstatement with OPR pursuant to Circular 230.
Two years later, after this court’s Loving decision
invalidated the 2011 rule, the IRS responded to Bowman’s
petition. Now recognizing that Bowman was not and had
never been an enrolled agent, OPR sent him a letter dated
November 3, 2014, informing him that “[a]ccording to the
[IRS’s] Enrolled Agent database, you are not an Enrolled
Agent.” Bowman Mot. for Summ. J. at 75. OPR went on to
warn Bowman that “unless you currently possess a license
under section 10.3 of Circular 230, you may not engage in full
practice before the Internal Revenue Service . . . .” Id. But
OPR concluded by restoring Bowman’s “ability to engage in
limited practice before the IRS, as defined in section 10.7 of
Circular 230, by removing [his] name from the list of
individuals currently barred from practice before the IRS.” Id.
In January 2014, Bowman, proceeding pro se, sued
Iddon, Copeland, and three other IRS officials. He raised a
single Bivens claim—that Defendants violated the Fifth
Amendment by harming his reputation and business without
due process—and sought compensatory damages, punitive
damages, and costs. Defendants moved to dismiss under
Federal Rules of Civil Procedure 12(b)(1) and (6) on a variety
7
of grounds, including failure to state a claim and qualified
immunity.
The district court granted Defendants’ motion to dismiss,
concluding that Circular 230’s comprehensive remedial
scheme governing practitioner discipline precluded any
Bivens remedy, regardless of whether Bowman was an
enrolled agent or unenrolled preparer. Bowman v. Iddon, 138
F. Supp. 3d 3, 8–9 (D.D.C. 2015). Bowman now appeals. In
considering the issues before us, we have been ably assisted
by court-appointed amicus.
II.
Amicus and Defendants focus their dispute on whether a
Bivens remedy is available here. We have no need to address
that question, however, because we affirm for an independent
reason, namely that Bowman’s complaint “fail[s] to state a
claim upon which relief can be granted.” Fed. R. Civ. P.
12(b)(6). Defendants raised this argument both in the district
court and in their brief here, and amicus responded. See Jones
v. Bernanke, 557 F.3d 670, 676 (D.C. Cir. 2009) (“[W]e may
affirm a judgment on any ground the record supports, and that
the opposing party had a fair opportunity to address.”
(citations and internal quotation marks omitted)).
To survive a motion to dismiss under Rule 12(b)(6), a
complaint must set forth “factual content that allows the court
to draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009). When considering a Rule 12(b)(6) motion, we
“accept[] as true all of the factual allegations contained in the
complaint and draw[] all inferences in favor of the nonmoving
party.” Autor v. Pritzker, 740 F.3d 176, 179 (D.C. Cir. 2014)
(citation and internal quotation marks omitted). Because
Bowman filed pro se, his complaint “is to be liberally
8
construed” and “must be held to less stringent standards than
formal pleadings drafted by lawyers.” Erickson v. Pardus,
551 U.S. 89, 94 (2007) (per curiam) (internal quotation marks
and citation omitted). We are not, however, limited to the
complaint itself: we may consider Bowman’s pro se affidavits
and exhibits, as well as public records subject to judicial
notice. See Abdelfattah v. U.S. Department of Homeland
Security, 787 F.3d 524, 529 (D.C. Cir. 2015) (drawing on pro
se affidavits and exhibits); Abhe & Svoboda, Inc. v. Chao, 508
F.3d 1052, 1059 (D.C. Cir. 2007) (drawing on “public records
subject to judicial notice on a motion to dismiss”).
Bowman alleges that Defendants deprived him of the
procedural due process guaranteed by the Fifth Amendment.
“A procedural due process violation occurs when an official
deprives an individual of a liberty or property interest without
providing appropriate procedural protections.” Atherton v.
District of Columbia Office of the Mayor, 567 F.3d 672, 689
(D.C. Cir. 2009). In his complaint, Bowman alleges a serious
procedural defect, i.e., that he received neither notice of his
suspension nor an opportunity to challenge it.
Bowman’s claim fails, however, because he identifies no
constitutionally protected interest lost through Defendants’
actions. His complaint repeatedly identifies a property interest
in his enrolled-agent status and then describes his Bivens
claim in one sentence: “Because Plaintiff has not received the
quantum of process he was due before being suspended
indefinitely as an Enrolled Agent [he] has suffered damage to
his reputation and business in perpetuity.” Compl. at 17. To
enjoy a “property interest in a benefit,” however, Bowman
must have a “legitimate claim of entitlement to it.” Board of
Regents of State Colleges v. Roth, 408 U.S. 564, 577 (1972).
Yet he has disclaimed any claim of entitlement to enrolled-
agent status. As he states in his affidavit, “At no time was I an
9
Enrolled Agent (Practitioner).” Bowman Aff. at 1.
Confirming the accuracy of that statement, the IRS’s official
response to Bowman’s reinstatement petition informed him
that he was “not an Enrolled Agent.” Bowman Mot. for
Summ. J. at 75. Obviously, if Bowman never obtained
enrolled-agent status, Defendants could not have deprived
him of his interest in that status, however careless their
actions.
Amicus argues that “Bowman’s claim involves . . . the
deprivation of his liberty interests in the ability to engage in
his chosen profession as a tax preparer and in his reputation.”
Amicus Br. 34. Indeed as amicus points out, we have
recognized that “when the government formally debars an
individual from certain work . . . , there is a cognizable
‘deprivation of liberty that triggers the procedural guarantees
of the Due Process Clause.’” Abdelfattah, 787 F.3d at 538
(quoting Trifax Corp. v. District of Columbia, 314 F.3d 641,
643–44 (D.C. Cir. 2003)). An individual may also bring a
“stigma-plus” claim if the defendant has harmed the
plaintiff’s reputation and “deprived [the plaintiff] of some
benefit to which [the plaintiff has] a legal right.” General
Electric Co. v. Jackson, 610 F.3d 110, 121 (D.C. Cir. 2010).
According to amicus, Bowman satisfies both of these
theories of liability because “he has alleged injury to his
liberty interest in pursuing his chosen profession as a tax
preparer in addition to damage to his reputation.” Amicus
Reply Br. 16. The argument goes like this: The IRS’s 2006
decision suspended Bowman from practice before the Service,
and although at that time the suspension only prevented him
from working as an enrolled agent, the Service later amended
its regulations to permit only practitioners—including
registered tax preparers—to prepare taxes. From then until
our decision in Loving, amicus argues, the suspension barring
10
Bowman from practicing before the IRS prohibited him from
becoming a practitioner and thus from preparing taxes.
Amicus’s theory, clever as it is, appears nowhere in the
complaint. Not once does Bowman allege that he was
prevented from preparing taxes. Instead, he repeatedly refers
to himself as an enrolled agent and links his harm to his
enrolled-agent status. He alleges that “according to the IRS
records” he “was an Enrolled Agent permitted to practice
before the Internal Revenue Service.” Compl. at 2; see id. at 3
(similar). He claims that Defendants publicized the “universal
suspension of Plaintiff, John J. Bowman, Jr. Enrolled Agent”
by email and in a Bulletin listing “Attorneys, [CPAs],
Enrolled Agents, and Enrolled Actuaries.” Id. at 6–7.
Bowman argues that “[a]n enrolled agent (EA) . . . is
considered a property interest that triggers Fifth Amendment
due process protection,” and that he “had a legitimate claim of
entitlement” to the “benefits” associated with being an
enrolled agent. Id. at 12–13; see Roth, 408 U.S. at 577
(explaining that, to have a protected property interest in a
benefit, an individual must “have a legitimate claim of
entitlement to it”). When describing the strength of the private
interest at stake in his procedural due process claim, Bowman
repeatedly characterizes it as his “property interest” and refers
to the IRS sanction as suspension not from tax preparation,
but rather from representing “all individuals, businesses, and
estates before the IRS.” Compl. at 13–14. And, as noted
above, Bowman identifies his Bivens claim as “being
suspended indefinitely as an Enrolled Agent” without due
process. Id. at 17. Even construing the complaint liberally, as
we must, it contains nothing resembling the claim amicus
asserts.
Amicus also argues that Bowman was barred from
preparing taxes from the moment of his suspension decision
11
in 2006 because the definition of “practice before the IRS” is
capacious enough to include tax preparation. Amicus Br. 36;
Oral Arg. Rec. 6:23–7:14. But again, and construing the
complaint liberally, we can find no basis for that argument in
in the complaint, which lacks any claim that Defendants
prevented Bowman from preparing taxes. The argument is
also foreclosed by our decision in Loving, which explains that
“tax-return preparers do not practice before the IRS when they
simply assist in the preparation of someone else’s tax return.”
742 F.3d at 1018.
Because the sole theory alleged in Bowman’s
complaint—that Defendants deprived him of a property
interest in his enrolled-agent status without due process—
cannot survive Defendants’ Rule 12(b)(6) motion to dismiss,
we affirm.
So ordered.
TATEL, Circuit Judge, with whom Senior Circuit Judge
GINSBURG joins, concurring: Although our resolution of this
case avoids the need to address Bowman’s Bivens claim,
because the issue is fully briefed and one of first impression
in this circuit, I write separately to explain why, had Bowman
alleged that Defendants barred him from preparing taxes, I
would have concluded that he was entitled to pursue his claim
against Defendants.
In Bivens, the Supreme Court recognized an implied right
of action for damages when federal officials violate the
Fourth Amendment. Bivens v. Six Unknown Named Agents of
the Federal Bureau of Narcotics, 403 U.S. 388 (1971); see
Davis v. Passman, 442 U.S. 228 (1979) (recognizing a Bivens
remedy for a claim of employment discrimination by a
congressman in violation of the Fifth Amendment’s Due
Process Clause). Since then, the Supreme Court and this
circuit have “tread carefully before recognizing Bivens causes
of actions.” Meshal v. Higgenbotham, 804 F.3d 417, 421–22
(D.C. Cir. 2015) (collecting cases). In determining whether to
do so, courts take a “case-by-case approach” rather than
asking “categorically[] whether a Bivens action can lie.” Id. at
422.
This approach involves two steps. First, courts consider
whether “‘any alternative, existing process for protecting the
constitutionally recognized interest amounts to a convincing
reason for the Judicial Branch to refrain from providing a new
and freestanding remedy in damages.’” Minneci v. Pollard,
132 S.Ct. 617, 621 (2012) (alteration omitted) (quoting Wilkie
v. Robbins, 551 U.S. 537, 550 (2007)). Second, “even in the
absence of an alternative, . . . federal courts must make the
kind of remedial determination that is appropriate for a
common-law tribunal, paying particular heed . . . to any
special factors counselling hesitation before authorizing a new
kind of federal litigation.” Id. (quoting Wilkie, 551 U.S. at
550).
2
One such special factor—the one at issue here—is the
existence of a “comprehensive remedial scheme” representing
“an informed congressional judgment . . . sufficient to stay the
judiciary’s hand.” Davis v. Billington, 681 F.3d 377, 382–83
(D.C. Cir. 2012). Specifically, the Supreme Court has
declined to extend Bivens when “the design of a Government
program suggests that Congress has provided what it
considers adequate remedial mechanisms for constitutional
violations that may occur in the course of its administration.”
Schweiker v. Chilicky, 487 U.S. 412, 423 (1988). If a claim
falls “within [the] ambit” of a comprehensive remedial
scheme, courts defer to Congress’s choice “about which
remedies should be available,” even if Congress has chosen to
provide no remedy at all. Davis, 681 F.3d at 383.
The district court concluded—and Defendants argue on
appeal—that Circular 230 qualifies as a comprehensive
remedial scheme that precludes Bowman’s Bivens remedy. As
Defendants point out, Circular 230’s disciplinary process
includes, “among other procedures, the institution of
proceedings (31 C.F.R. § 10.60), service of the complaint
(§ 10.63), the filing of an answer (§ 10.64), representation
(§ 10.69), conduct of the hearing (§ 10.7[2]), and [the]
decision of the Administrative Law Judge (§ 10.76),”
followed by “appeal . . . to the Secretary of the Treasury” and
“federal court review.” Appellee’s Br. 29–30. These
procedures allow practitioners to “challenge allegations of
misconduct.” Id. at 29.
In support of their argument that this scheme bars
Bowman’s Bivens claim, Defendants cite a series of cases in
which we rejected Bivens claims in situations where Congress
intended to include “a particular claimant—and his
underlying claim”—within the ambit of “a given
congressional ‘comprehensive system.’” Spagnola v. Mathis,
3
859 F.2d 223, 229 (D.C. Cir. 1988) (en banc) (per curiam);
see Davis, 681 F.3d at 387; cf. id. at 383–84 (examining a
comprehensive remedial scheme that covers the claimant).
For instance, in Spagnola v. Mathis, we held that because the
plaintiffs’ constitutional claims qualified as “prohibited
personnel practices” within the meaning of the Civil Service
Reform Act (CSRA), and because the actions they challenged
were “plainly cognizable” under the Act, their claims fell
within the Act’s ambit. 859 F.2d at 229 & n.11. In Wilson v.
Libby, the defendants disclosed information “subject to the
Privacy Act’s protections,” but the Act exempted the
defendants from its remedies. 535 F.3d 697, 707 (D.C. Cir.
2008). “Th[e] intentional omission of the [defendants] from
the comprehensive coverage of the Privacy Act,” we
concluded, “require[d] us to deny the additional remedies to
the [plaintiffs] which they seek.” Id. at 708. And in Davis v.
Billington, we explained that the CSRA precluded a Bivens
claim brought by a Library of Congress probationary
employee because the Act “deliberately included Library of
Congress employees in the ‘civil service’ governed by the
CSRA” and “just as deliberately . . . limit[ed] the
beneficiaries of the CSRA’s remedial protections in large part
to non-probationary employees in the executive branch.” 681
F.3d at 384. The CSRA, moreover, provided “procedural
protections and rights of appeal for the specific underlying
actions [the plaintiff] challenge[d].” Id. at 387.
This case is very different. In Loving, we held that
Congress, in enacting the statute under which the Secretary of
the Treasury promulgated Circular 230, see 31 U.S.C.
§ 330(a), had no intention of giving the Secretary authority
over tax preparers. 742 F.3d at 1022. As we noted, that statute
only authorizes the Secretary to “regulate the practice of
representatives of persons before the Department of the
Treasury.” Id. at 1015 (quoting 31 U.S.C. § 330(a)(1)). Tax
4
preparers, we explained, are not “representatives,” and tax-
return preparation is not “practice . . . before the Department
of the Treasury” within the meaning of the statute. 742 F.3d at
1016–21. Accordingly, the IRS lacked statutory authority to
discipline tax preparers, including through Circular 230.
Bowman’s case is thus not at all like Spagnola, Wilson,
or Davis. Unlike the plaintiff’s claim in Spagnola, Bowman’s
claim—that is, the claim amicus offers on his behalf—is not
“plainly cognizable” under the remedial scheme. Unlike in
Wilson, where Congress “intentional[ly] omi[tted]” a remedy
for the plaintiff, here Congress said nothing at all about a
remedy for tax preparers disciplined by IRS officials without
due process. And unlike in Davis, where the statute provided
“procedural protections and rights of appeal for the specific
underlying actions” the plaintiff challenged, here the scheme
provides no protections at all from Defendants’ series of
blunders. In light of Loving, congressional silence here
reveals not only that Congress intended to provide no remedy
for the claims of a tax preparer disciplined by IRS officials
without due process, but also that it intended to give the IRS
no disciplinary authority over the claimant at all. As amicus
puts it, Congress “left tax preparers entirely outside the
scheme and therefore outside the reach of lawful IRS
disciplinary action.” Amicus Br. 27.
Instead, this case is like Stewart v. Evans, 275 F.3d 1126
(D.C. Cir. 2002), in which we permitted a federal employee to
pursue a Fourth Amendment Bivens claim against her
supervisors because a warrantless search—the focus of her
claim—“falls outside the condemnation (and, we presume, the
approbation) of the” CSRA. Id. at 1130. Likewise here. Given
our decision in Loving, tax preparers’ claims of unlawful IRS
discipline fall outside the “condemnation” of Circular 230’s
remedial scheme.
5
Defendants cite our decision in Kim v. United States, 632
F.3d 713 (D.C. Cir. 2011), in which we concluded that tax
protesters could not bring a Bivens action against IRS officials
because the Internal Revenue Code offers taxpayers a set of
rights and remedies reflecting its “balance between the desire
for taxpayer protection and the need for efficient tax
administration.” Adams v. Johnson, 355 F.3d 1179, 1186 (9th
Cir. 2004); see Kim, 632 F.3d at 717 (citing Adams); see also
True the Vote, Inc. v. IRS, 831 F.3d 551, 556–57 (D.C. Cir.
2016) (precluding a Bivens remedy for organizations seeking
tax-exempt status in light of the Internal Revenue Code’s
remedy for challenging rulings on tax exemption). Here, by
contrast, under Loving the IRS remedial scheme offers tax
preparers no rights or remedies at all. Indeed, in the only case
Defendants cite where a court held that Circular 230
precluded a Bivens remedy, the plaintiff was a practitioner,
and practitioners are subject to Circular 230. Kenney v. United
States, 489 F. App’x 628, 631–32 (3d Cir. 2012). As Loving
teaches, tax preparers are not practitioners, and Circular 230
has never lawfully governed their relationship with the IRS.
To be sure, tax preparers are subject to other statutory
penalties elsewhere in the Internal Revenue Code for certain
kinds of misconduct. See Loving, 742 F.3d at 1020 (citing 26
U.S.C. §§ 6694, 6695, 6713) (“Over the years, Congress has
enacted a number of targeted provisions specific to tax-return
preparers, covering precise conduct ranging from a tax-return
preparer’s failing to sign returns to knowingly understating a
taxpayer’s liability.”). But Defendants never argue that these
provisions preclude Bowman’s Bivens claim. And in any
event, scattered statutory penalties for things like failure to
sign a tax return, see 26 U.S.C. § 6695(b), hardly amount to a
comprehensive scheme evincing congressional intent to
preclude Bivens remedies for other, ultra vires IRS actions
like the ones at issue here. Cf. Davis, 681 F.3d at 385–86
6
(finding a remedial scheme preclusive after reviewing its
“careful categorization of the subsets of civil-service
employees eligible for each part of the CSRA’s remedial
scheme”).
Resisting this analysis, Defendants argue that Bowman’s
claim falls within Circular 230’s remedial scheme because he
may obtain “limited practice” rights, that is, he may represent
“particular persons or entities before the IRS, where such
representation reflects well-accepted agent-principal
relationships.” Amicus Br. 30 (citing 31 C.F.R. § 10.7(c)(1)).
But tax preparers have no special limited practice rights. They
may engage in limited practice only to the same extent as any
other individual—for instance, by representing a member of
their immediate family or their employer. 31 C.F.R.
§§ 10.7(c)(1)(i)–(ii). The limited practice scheme is too thin a
reed to support the conclusion that Congress intended to
preclude a Bivens remedy in this context.
Finally, Defendants argue that prior to our decision in
Loving, when Circular 230 covered tax preparers, the
remedial scheme “was available to Bowman” and “he availed
himself of it” by filing his petition for reinstatement.
Appellee’s Br. 37. In Loving, however, we explained that the
IRS’s effort to extend Circular 230 to tax preparers was an
“expansive, atextual, and ahistorical reading” of the statute.
742 F.3d at 1022. In other words, the statute never lawfully
covered tax preparers. In any event, the question here is not
whether Bowman made an ill-fated attempt to avail himself of
the remedial scheme, but rather whether Congress intended
that scheme to encompass tax preparers. The answer is no.
To sum up, had Bowman alleged that Defendants
disciplined him without authority and barred him from
preparing taxes, I would have concluded that Circular 230’s
7
remedial scheme presents no bar to a Bivens claim in the
narrow and unique circumstances of this case. In reaching this
conclusion, I note that Defendants have identified no other
reason why this court should refrain from recognizing a
Bivens remedy here. Cf. Wilkie, 551 U.S. at 554–62
(weighing the “reasons for and against the creation of a new
cause of action, the way common law judges have always
done”). I also acknowledge that this court is reluctant to
recognize new Bivens claims and does so rarely. But rarely
does not mean never. This circuit has recognized Bivens
claims before, supra at 4, as have other circuits, see e.g.,
Engel v. Buchan, 710 F.3d 698, 699 (7th Cir. 2013)
(recognizing a Bivens claim for Brady violations); Smith v.
United States, 561 F.3d 1090, 1102–03 (10th Cir. 2009)
(concluding that the Inmate Accident Compensation Act did
not preclude a Bivens action “for constitutional harms arising
from work-related asbestos exposure”), and we should be
prepared to do so again in appropriate circumstances—like
those existing here.