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United States v. Mooney

United States District Court, D. Minnesota

May 31, 2017

United States of America, Plaintiff,
William J. Mooney, Joni T. Mooney, and Harbor Holdings, Mid-Atlantic Trustees and Administrators, Defendants.

          Michael R. Pahl, United States Department of Justice District of Columbia, for Plaintiff.

          William J. Mooney and Joni T. Mooney, pro se.


          SUSAN RICHARD NELSON, United States District Judge


         This matter comes before the Court on the Objections [Doc. No. 75] of Defendants William J. Mooney and Joni T. Mooney (together, the “Mooney Defendants”) to United States Magistrate Judge Leo I. Brisbois's Report and Recommendation (“R&R”), dated May 1, 2017 [Doc. No. 76]. The magistrate judge recommended that the Mooney Defendants' Motion for Dismissal with Prejudice [Doc. No. 51] be denied.

         Pursuant to statute, this Court reviews de novo any portion of the magistrate judge's opinion to which specific objections are made, and “may accept, reject, or modify, in whole or in part, the findings or recommendations” contained in that opinion. 28 U.S.C. § 636(b)(1)(C); see also Fed. R. Civ. P. 72(b); D. Minn. LR 72.2(b)(3). For the reasons stated herein, the Court overrules the Mooney Defendants' objections and adopts the R&R in its entirety.


         The facts underlying this case and the present motion have been thoroughly and accurately stated in the R&R, the background section of which the Court incorporates by reference here. Very briefly stated, Plaintiff, the United States of America, “brings this action against the above defendants to reduce federal tax and penalty assessments to judgment and enforce federal tax liens on property located in this district.” (Compl. [Doc. No. 1] at 1.) Plaintiff alleges that for the period from 2002 to 2014, the Secretary of the Treasury calculated tax assessments against the Mooney Defendants totaling $87, 475.07, and penalty assessments for the same period totaling $71, 295.14. (See Id. ¶¶ 6-8, 12-17.) Plaintiff seeks to enforce tax liens on property occupied by the Mooney Defendants in Little Falls, Minnesota. (See Id. ¶ 5.)

         The Complaint alleges that although the Mooney Defendants acquired the property by deed in February 26, 1982, and have continuously occupied it since, they purported to convey their interest in the property to Defendant Harbor Holdings, Mid-Atlantic Trustees and Administrators, Trustee (“Harbor Holdings”) by a quit claim deed recorded on November 1, 2004. (See Id. ¶¶ 18, 25.) Plaintiff contends that “Mid-Atlantic Trustees and Administrators” was the name used by certain promoters to “promote an abusive tax scheme where customers used sham trusts to hide their income and assets from the IRS.” (Id. ¶ 26.) Importantly, although Harbor Holdings was supposedly the title-holder to the Little Falls property, the Mooney Defendants have “enjoyed the benefits of, and paid for all costs associated with the property, ” and “are the named insureds under the current homeowners insurance on the property.” (Id. ¶¶ 31-33.) Ultimately, the Complaint asserts that the “federal tax liens associated with the unpaid federal income tax and penalty assessments against William J. and Joni T. Mooney (individually and jointly)” should “attach to the [Little Falls] property” and be enforced by a court-ordered sale of the property and distribution of the proceeds. (See Id. ¶ 37.)

         Between the filing of the Complaint on July 28, 2016 and the present date, the Mooney Defendants have engaged in what may be described as an unconventional response to litigation. A complete recounting of events is contained in the R&R, and for the sake of brevity will not be repeated here. Of particular note, Defendant William J. Mooney, although not a lawyer authorized to practice law in the State of Minnesota or to appear before this Court, has attempted to represent not only himself but his wife and Harbor Holdings. (See Jan. 30, 2017 Order [Doc. No. 47].) Defendants have also filed more than two dozen affidavits, exhibits, motions, and notices with names such as “Lawful Notice of Fault in Dishonor” and “Affidavit of ‘Friend of a Friend' and “Constitutional Consul'.” These documents have generally proven non-responsive to the Complaint and not in keeping with the Federal Rules of Civil Procedure, and accordingly have been nearly universally stricken from the record by the magistrate judge. (See Jan. 30, 2017 Order; Nov. 7, 2016 Order [Doc. No. 36].) Judge Brisbois has also repeatedly reminded the Mooney Defendants that a non-lawyer may not represent a third-party in court. (See, e.g., Jan. 30, 2017 Order.)

         Because Defendant Harbor Holdings had failed to plead or otherwise properly defend the action-despite repeated orders of this Court to do so-Plaintiff moved for an entry of default as to that defendant on February 2, 2017. (See Request for Entry of Default [Doc. No. 48].) Pursuant to Federal Rule of Civil Procedure 55(b)(1), the Clerk of Court duly entered default four days later. (See Clerk's Entry of Default [Doc. No. 50].) On February 15, 2017, the Mooney Defendants filed the present Motion for Dismissal with Prejudice. They contend that dismissal is warranted on five separate grounds: (1) lack of subject matter jurisdiction; (2) lack of personal jurisdiction; (3) insufficient process as to Defendant Harbor Holdings; (4) insufficient service of process as to the same defendant; and (5) failure to join Harbor Holdings. The magistrate judge filed the R&R as to the Mooney Defendants' motion on May 1, 2017, recommending that the motion be denied. The Mooney Defendants have since filed timely objections to the R&R, triggering this de novo review.


         A. Standard of Review

         Upon issuance of an R&R, a party may “serve and file specific written objections to the proposed findings and recommendations.” Fed.R.Civ.P. 72(b)(2) (emphasis added). “The objections should specify the portion of the magistrate judge's [R&R] to which objections are made and provide a basis for those objections.” Mayer v. Walvatne, No. 07-cv-1958 (JRT/RLE), 2008 WL 4527774, at *2 (D. Minn. Sept. 28, 2008). Objections which are not specific but merely parrot arguments already presented to and considered by the magistrate judge are not entitled to de novo review. Dunnigan v. Fed. Hom Loan Mortg. Corp., No. 15-cv-2626 (SRN/JSM), 2017 WL 825200, at *3 (D. Minn. Mar. 2, 2017) (citing Mashak v. Minnesota, No. 11-cv-473 (JRT/JSM), 2012 WL 928251, at *2 (D. Minn. Mar. 19, 2012)). Furthermore, when presenting arguments to a magistrate judge, parties must put forth “not only their ‘best shot' but all of their shots.” Ridenour v. Boehringer Ingelheim Pharm., Inc., 679 F.3d 1062, ...

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