The opinion of the court was delivered by: HUYETT
Presently before me is a petition to quash a summons issued by the Internal Revenue Service to the Vice President of the Ephrata National Bank requesting information concerning the financial affairs of petitioners William H. and Linda L. Johnson. The IRS is currently investigating the federal income tax liability of the Johnsons for the years 1981 through 1983. The United States filed a motion for summary denial of the petition and a motion for summary enforcement of the summons, and has requested an award of attorney's fees and costs. For the reasons which follow, the petition to quash will be denied and the government's request for summary enforcement and for an award of attorney's fees and costs will be granted.
The relevant facts in this case can be summarized as follows. On November 29, 1984, Carl J. Butler, a special agent with the IRS, issued a "third party recordkeeper" summons to the Ephrata National Bank to obtain information which the bank possessed relating to the Johnsons' financial transactions for the years in question. Such "third party recordkeeper" summons are authorized by 26 U.S.C. § 7609(a)(3).
In order to establish a prima facie case for enforcement, the government must show that (1) the investigation is being conducted for a legitimate purpose; (2) the information sought is relevant to that purpose; (3) the information is not already in the possession of the IRS, and (4) the administrative steps required by the IRS have been followed. See United States v. Powell, 379 U.S. 48, 57-58, 13 L. Ed. 2d 112, 85 S. Ct. 248 (1964); Godwin v. United States, 564 F. Supp. 1209 (D.Del. 1938). The government has filed a sworn declaration of Special Agent Butler that establishes all of the requisite elements of a prima facie case for enforcement of the summons. The burden therefore shifts to the petitioners to disprove the existence of a valid purpose or to show that enforcement of the summons would be an abuse of the court's process or would otherwise be improper. United States v. Powell, 379 U.S. at 58; Byasse v. United States, No. 84-2415 slip op. (E.D. Pa. Sept. 26, 1984). Specifically, the party opposing an IRS summons must come forward with specific facts, under oath, from his or her own resources, demonstrating that a triable issue exists on a legally sufficient defense, in order to justify an evidentiary hearing. Universal Life Church, Hidden Valley Congregation v. United States, 573 F. Supp. 181, 183 (W.D. Va. 1983); Godwin v. United States, 564 F. Supp. at 1215.
The government has asked for the imposition of sanctions. It asserts that the petition submitted by the petitioners in this case is a patently frivolous form petition brought solely for the purpose of delay in contravention of Rule 11 of the Federal Rules of Civil Procedure. Alternatively, if this position is not accepted, the government has requested that sanctions be imposed if the petitioner continues to prosecute this action on frivolous grounds.
I agree with the government that the imposition of sanctions is warranted in this case. Under Rule 11 of the Federal Rules of Civil Procedure, the petitioners' signing of the petition constituted a certification that: "to the best of his [their] knowledge, information, and belief formed after reasonable inquiry it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law, and that it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation . . . [Emphasis added.]"
As the Advisory Committee Notes state, the standard is the same for unrepresented parties, but a determination as to what is reasonable must take into account any special circumstances of the pro se litigant.
Accordingly, the government's request for attorney's fees and costs will be granted. The government shall submit within two weeks appropriate affidavits so that a determination may be made as to the appropriate attorney's fees and costs.
An appropriate order follows.
NOW, March 27, 1985, upon consideration of the petition to quash the Internal Reveneu summons, respondent's motion for summary enforcement of the third party recordkeeper summons, the memoranda of law and affidavits submitted by the parties, and for the ...