The opinion of the court was delivered by: Buckwalter, S.J.
Currently pending before the Court is the Motion of Defendant United States of America to Dismiss Plaintiffs' Complaint for lack of subject-matter jurisdiction. For the following reasons, the Motion is granted.
I. FACTUAL AND PROCEDURAL HISTORY
According to the facts set forth in the Complaint, Plaintiffs Lothar E.S. Budike, Sr. and Alexandra Budike are husband and wife. (Compl. ¶¶ 9-10.) Mr. Budike is President of Plaintiff AValey Engineers, Inc. ("A-Valey"), a multi-discipline engineering and consulting firm, while Mrs. Budike is the Secretary of A-Valey. (Id.) In April 2000, the Budikes were notified by the IRS, located in Media, Pennsylvania, that their company A-Valey was going to be audited for the fiscal year 1999. (Id. ¶ 13.) Shortly thereafter, they received a follow-up correspondence stating that IRS agent John L. Vastardis would be performing the audit. (Id. ¶ 14.) From the onset of the audit, Mr. Budike sought a conference meeting with an IRS supervisor to request that Agent Vastardis be removed from the process due to a conflict of interest. (Id. ¶¶ 16-17.) Specifically, Mr. Budike noted that Agent Vastardis, the Budikes, and the Budikes' accountant for the past forty-five years (Lazarus P. Kirfides), were all members of the same Greek Church and community and had been so for many years. (Id. ¶ 18.) Moreover, Mr. Budike, as a professional engineer and owner of AValey, worked and performed as the engineer of record on numerous construction projects in which Agent Vastardis's father was employed as a contractor. (Id. ¶ 19.) Finally, Agent Vastardis's father and Mr. Budike were investors/business partners on a failed housing development project in Pleasantville, NJ, in which Mr. Budike and Agent Vastardis's father both lost a substantial amount of money. (Id. ¶ 20.) Mr. Budike was blamed by the Vastardis family for their financial loss. (Id.). Despite Mr. Budike's request, however, he was never afforded a conference with a supervisor. (Id. ¶ 16.)
In June 2000, Mr. Budike received a follow-up correspondence from the IRS outlining the procedures for the upcoming audit and requesting certain documents. (Id. ¶ 21.) Mr. Budike complied and turned over all personal and corporate bank statements, including a special bank account for long-term projects and the U.S. Department of Commerce Overseas Balkan States Project. (Id. ¶ 22.) Due to the sensitive nature of the latter operation, which was gathering criminal information against certain Greek citizens who were covertly operating within Greek communities in the United States, Mr. Budike's attorney, Kirk Karaszkiewicz, decided that the audit should be performed at his Philadelphia, Pennsylvania office. (Id. ¶¶ 23-24.) Mr. Karaskiewicz also decided to bar accountant Lazarus Kirfides from the audit process because of his relationship with certain Greek companies that were the target of the criminal investigation. (Id. ¶ 25.)
During the course of the audit process, Agent Vastardis called Mr. Budike and requested a private meeting at his Media, PA office. (Id. ¶ 27.) At that time, Agent Vastardis indicated that he needed to come to A-Valey's New Jersey Corporate Office facility to inspect company trucks and equipment, and that it was unnecessary for Mr. Budike's attorney or accountant to be present. (Id.)
Mr. Budike again requested a conference meeting with Agent Vastardis's supervisor, but was again denied. (Id. ¶ 28.) During the subsequent audit process at the New Jersey facility, Agent Vastardis searched all the vehicles, as well as the storage bins in the shop and the kitchen cabinet areas, and confiscated paperwork. (Id. ¶¶ 29-31.) He also asked several employees personal questions regarding the Budike family, none of which had anything to do with their business affairs. (Id. ¶ 32.)
Thereafter, Agent Vastardis stated to Mr. Budike that he needed to audit the books of his daughter's company, named General Contracting, Inc., and his son's company, named Powerweb Technologies, Inc. ("Powerweb"), in order to complete his audit. (Id. ¶ 33.) Both the son and daughter maintained an office at the New Jersey Corporate Office facility. (Id.) Mr. Budike's daughter immediately turned over her corporate books, while Mr. Budike's son issued an opinion letter through his Accountant refusing to turn over his books and income tax returns. (Id. ¶¶ 34-35.) He further wrote that the IRS had no legal rights to Powerweb's books because it was not the subject of the audit. (Id. ¶ 35.) At the insistence of Agent Vastardis, however, Powerweb's books, which included a confidential listing of Powerweb's stockholders and their social security numbers, were physically taken without the authorization of either Mr. Budike or his son. (Id. ¶ 37.)
On September 16, 2007, Agent Vastardis and Mr. Budike's son were invited to an intimate dinner engagement by a mutual friend. (Id. ¶ 38.) During this dinner, Agent Vastardis told Mr. Budike's son that if he ever encountered a problem with the IRS that he could intervene on his behalf and have the problem corrected. (Id. ¶ 39.) The son informed his father of this encounter and Mr. Budike, in turn, viewed this as either extortion or an attempt to entrap the Budikes in a bribery/sting operation. (Id. ¶ 40.) As such, Mr. Budike reported this incident to the proper authorities within the IRS. (Id. ¶ 41.) Subsequently, Mr. Budike's son was served with an official IRS letter that he was going to be audited. (Id. ¶ 42.)
As a purported result of the pressure from the audits, Mr. Budike lapsed into a long-term illness and battle with depression, where he was admitted to a mental hospital. (Id. ¶ 43.) The inspection and audit was postponed for several months as Mr. Budike was not able to fulfill his personal and business obligations. (Id.) Prior to his full recovery, Agent Vastardis contacted him to state that he was being pressured by his supervisor to conclude his audit. (Id. ¶ 44.) While still under his doctor's care and heavy medication, Mr. Budike returned to the office to complete the audit. (Id.)
At the completion of the audit, Agent Vastardis personally contacted Mr. Budike via telephone so he could go over the outcome. Shortly thereafter, a letter from the IRS arrived indicating that the Budikes were deficient in their reported income and that the Budikes and AValey were levied additional taxes, penalties, and interest in excess of $3 million dollars. (Id. ¶ 47). Mr. Budike believes that Agent Vastardis had made false, misleading, and ambiguous statements during the course of the audit and purposefully retaliated against the Budikes for the failed investment of Agent Vastardis's father. (Id. ¶ 48.) The case has been in dispute since its inception in 2001, and, to date, remains unresolved. (Id. ¶ 50.)
In 2008, the Budike family was finally afforded an opportunity to meet with IRS Appeals Officer David Rollins concerning the audit. (Id. ¶ 51.) Plaintiffs allege that Mr. Rollins and IRS Counsel Tom Rath's inability to remember stipulations, understandings, and agreements prevented the matter from being amicably and timely resolved. (Id. ¶ 53.) Ultimately, the Budikes agreed to settle the matter for $300,000 in order to proceed to federal court for a proper determination. (Id. ¶ 54.) The IRS, however, assessed them additional penalties and interest in the amount of $300,000, bringing the total assessed liability and obligation to $600,000. (Id. ¶ 55.)
On February 2, 2009, IRS Revenue Officer Henry Kline arrived unannounced at the Budikes' home office in Wallingford, Pennsylvania. (Id. ¶ 56.) Mr. Kline spoke with Mrs. Budike and threatened her by stating that they owed the IRS in excess of $400,0000 and had five days to make the required payment or face seizure of their assets. (Id. ¶ 56.) Mr. Budikes' personal representative, Reverend Duane A. Quamina, then called Mr. Kline to find out the purpose of his visit. (Id. ¶ 57.) Rev. Quamina explained that the Budikes were in the process of appealing the interest and penalties, and Mr. Kline responded that the Budikes needed to file a "Reasonable Cause Letter" sent to his attention instead of the IRS form 843 "Claim for Refund and Request for Abatement," which the Budikes had already prepared. (Id.)
On February 9, 2009, Mr. Budike met with Mr. Kline at his office, at which time Mr. Kline told Mr. Budike that they had no right to appeal and admonished him not to file IRS Form 433-B, apply for installment payments, or file IRS Form 843. (Id. ¶ 58.) He further told Mr. Budike that he must pay the assessed penalties before the IRS would consider his abatement request, but that, in his thirty years with the IRS, he had never seen the IRS abate anyone's interest or penalty. (Id. ¶ 58.) Subsequently, on February 17, 2009, Mr. Kline told Mr. Budike to come to his office and bring three separate checks in the amounts of $14,741, $4,242, and $2,422. (Id. ¶ 59.) Moreover, Mr. Kline stated that if Mr. Budike complied, he would ask his boss to give Mr. Budike an additional five to ten days to make payment in full, but if he did not comply, he would immediately file a levy and lien against the Budikes and seize their assets. (Id. ¶ 59). Then, on February 17, 2009, Mr. Kline wrote to the Budikes stating that he had conferred with IRS District Counsel and was advised that they had availed themselves of all appeal rights and "waived the restrictions contained in I.R.C. 6213(a) prohibiting assessment and collection of the deficiencies and ...