Offenses by Officers
& Employees of U.S. Page5

Although
Michael does grapple with the apparent conflict between the
Mandamus and Venue Act, 28 U.S.C. §1361, and the Anti-Injunction act,
it does not support Plaintiff's position. The Michael court found
that the Mandamus Act did "not override the Anti-Injunction
Act."
Id.
at 506. The Court held that in order to prevail, the plaintiff had to
"show either that its claim does not implicate the Anti-Injunction
Act or that it fits within the narrow exception to that act."
Id.
The Court in Michael then went on to enumerate the factors that
must be present in order to invoke the Enochs exception: (1)
"irreparable injury, the essential prerequisite for injunctive
relief in any case," and (2) "certainty of success on the
merits."
Id.
In reversing the district court's dismissal of Plaintiff's claim, the Michael
court ultimately found that the plaintiff had established irreparable
injury and had established that, "under the most liberal view of
the law and facts, the
United States
cannot establish its claim." Id.; see also Davidson, supra.
(denying injunctive relief based on the Anti-Injunctive Act because it
could not be said that the government would be unable to establish the
validity of assessments made and taxpayers did not establish lack of
legal remedy).
Here,
Plaintiff has not established that his claim does not implicate the
Anti-Injunction Act or that the claim fits within the narrow exception
to that Act. See Bowers v. United States [70-2 USTC ¶9560], 423
F.2d 1207 (5th Cir. 1980) (dismissing taxpayer's suit holding that he
did not establish that his case fell within the judicial exception to
the Anti-Injunction Act); see also Keese v.
United States
[86-1 USTC ¶9389], 632 F.Supp. 85 (S.D. Tex 1985) (dismissing a
suit brought by an income tax preparer finding that the preparer failed
to establish an irreparable injury beyond conclusory allegations that
the IRS was injuring her business and reputation or that the government
would under no circumstances prevail). Recognizing that the Federal
Rules of Civil Procedure prescribe a liberal pleading standard, the
Court GRANTS Plaintiff leave to Amend his Complaint in accordance with
this Order so that he may clarify what equitable relief, if any, he may
be entitled to. If Plaintiff desires to submit an amended complaint, it
must be filed within fifteen (15) days of receipt of this Order.
The
Court recognizes, as delineated above, that certain exceptions exist to
allow equitable relief despite the Anti-Injunction Act's prohibition of
such relief. The injunctive relief, however, when granted, is always in
conjunction with a claim of some wrongdoing. In a typical case, the
wrongdoing would involve the levy of an unlawful tax assessment by the
IRS against a taxpayer. If this is the case here, Plaintiff, in his
second amended complaint needs to identify the tax assessment that was
wrongfully assessed so that the Court can address Plaintiff's claim as
it relates to that allegedly unlawful action. As drafted, Count One of
Plaintiff's Amended Complaint references the general factual scenario
and mentions a laundry list of alleged statutory violations: Circular
230 of the Internal Revenue Code, Sections 6103, 7214, 7431, 7435,
7521(b) and (c), and 7605(b) of the Internal Revenue Code, various rules
for practice before the Internal Revenue Service, as well as IRS
internal policies regarding the improper inspection and disclosure of
Plaintiff's income information, the unauthorized maintenance of files on
Plaintiff, the illegal interview of Plaintiffs employees, and the
improper enticement of Plaintiff's representatives. Count One does not,
however, allege, or specify in any way what activity constitutes a
violation of the statutes listed therein.
Accordingly,
the Court GRANTS Defendants' Motion to Dismiss Plaintiff's claim for
injunctive relief in Count One but grants Plaintiff leave to amend his
Complaint a second time.
2.
Plaintiff's Claim pursuant to 26 U.S.C. §7431
Counts
One, Two and Three of Plaintiff's Complaint, as amended, allege the
violation of 26 U.S.C. §7431. Section 7431 states that if any officer
or employee of the
United States
knowingly or negligently inspects or discloses any return or return
information with respect to a taxpayer in violation of any provision of
section 6103, such taxpayer may bring a civil action for damages against
the
United States
. 26 U.S.C. §7431. Section 6103 states that no officer or employee of
the
United States
shall disclose any return or return information obtained by him in any
manner in connection with his service as such officer or an employee. 26
U.S.C. §6103.
Defendants
argue that Plaintiff fails to state a claim for which relief can be
granted because Plaintiff (1) has not identified the specific return or
return information that was unlawfully disclosed, and (2) has not
alleged the disclosure of any information that would be defined as
"return information." Defendants argue that Plaintiff can not
state a claim under Section 7431 for the disclosures made with respect
to Joan Martin as the statute allows recovery only for information
pertaining to the taxpayer-litigant, Plaintiff in this case, and not an
"associate" of Plaintiff.
Plaintiff
argues generally that the Federal Rules of Civil Procedure reject the
notion that pleadings should be construed strictly so that judgments are
rendered on the skill of a litigant in drafting pleadings rather than on
the substance of the case. Plaintiff maintains that construed liberally,
his Complaint sufficiently states a claim for which relief can be
granted. In addition to this general argument, Plaintiff specifically
argues that Section 7431 provides a cause of action for the unlawful
inspection or disclosure of returns and that his Complaint has
sufficiently stated a claim under both theories.
Defendants'
Motion does not address Plaintiff's claim of an unlawful inspection. Nor
does the sole case cited by Defendants address the unlawful inspection
prong of a claim pursuant to Section 7431. The Court notes that 26
U.S.C. 7431 was amended in 1997 to include liability for unlawful
inspection as well as the already existing unlawful disclosure. See
26 U.S.C. 7431 (2000), amended by Taxpayer Browsing Protection
Act, PL 105-35,11 Stat. 1104,
August 5, 1997
. The decision in the case cited by Defendants was rendered in 1987,
many years before this provision was enacted. See Flippo v.
United States,
1987
U.S.
Dist. LEXIS 16096 (W.D.N.C. May 13,1987).
Pretermitting
an examination into the soundness of Defendants argument concerning
Plaintiff's claim pursuant to Section 7431 for an unlawful disclosure in
violation of 26 U.S.C. §6103, the Court finds that Plaintiff has stated
a claim pursuant to Section 7431 for an unlawful inspection in violation
of 26 U.S.C. §6103. Accordingly, the Court DENIES Defendants' Motion to
Dismiss as it relates to Plaintiff's claim pursuant to 26 U.S.C. §7431.
The
Court notes that Count Two of Plaintiff's Amended Complaint is also
confusing as to which statutes are alleged to have been violated and
which conduct on the part of Defendants comprised these violations. 10 The Court,
therefore, orders Plaintiff to clarify Count Two in accordance with this
Order when and if Plaintiff submits an Amended Complaint.
3.
Plaintiff's Claim pursuant to 5 U.S.C. §552
One
of the violations alleged to have been perpetrated by Defendants listed
in Count Three of Plaintiff's Complaint, as Amended, is a violation of
the Freedom of Information Act ("FOIA"), 5 U.S.C. §552.
Defendants argue that (1) the FOIA does not authorize suit against
federal employees or officers and (2) the FOIA does not provide for the
recovery of money damages. Defendants also argue that Plaintiff has not
alleged that he has exhausted the administrative remedies available to
him under the FOIA by submitting an administrative appeal to the
appropriate agency officials.
Plaintiff's
Response restates that Defendants violated the FOIA and the Privacy Act
of 1974, 5 U.S.C. §552(a). 11 The
Response does not, however, respond to Defendants valid objections
detailed above. Accordingly, the Court finds that Plaintiff's claim
pursuant to the FOIA should be dismissed because (1) the FOIA does not
authorize suit against federal employees or officers, (2) the FOIA does
not provide for the recovery of money damages, and (3) Plaintiff has not
alleged that he has exhausted the administrative remedies available to
him under the FOIA by submitting an administrative appeal to the
appropriate agency officials. Accordingly, the Court GRANTS Defendants'
Motion to Dismiss as it relates to Plaintiff's claim pursuant to the
FOIA, 5 U.S.C. §552. 12
4.
Plaintiff's Claim pursuant to 26 U.S.C. §7214 13
Defendants
argue that §7214 does not create a private cause of action. See
Nordbrook v. United States [2000-1 USTC ¶50,247], 96 F.Supp.2d 944,
948 (D. Ariz. 2000) (dismissing claim pursuant to 26 U.S.C. §7214,
finding "no basis for implying a civil cause of action from these
federal criminal code provisions"). They argue that the statute is
a criminal statute and only the government has the authority to enforce
its criminal laws. Plaintiff's Response argues that the Writ of Mandamus
and Venue Act confers jurisdiction upon him to bring a suit to move the
Court to enforce these provisions. Plaintiff provides no case law and
does not elaborate on this claim.
Section
7214 does not grant this Court jurisdiction or waive the Government's
sovereign immunity. It merely provides a criminal penalty for the
unlawful acts of revenue officers or agents. Plaintiff has failed to
state a claim. Accordingly, the Court GRANTS Defendants' Motion to
Dismiss all of Plaintiff's claims pursuant to 26 U.S.C. §7214.
5.
Plaintiff's Claim pursuant to 26 U.S.C. §7435
Defendants
argue that Section 7435 provides a remedy to a taxpayer when an employee
of the IRS compromises the determination of a tax due to a taxpayer in
exchange for information from a representative about that taxpayer's tax
liability. Defendants argue that the purview of the statute does not fit
the factual scenario delineated in Plaintiff's Complaint, as amended.
Section 7435 provides in relevant part:
(a)
In general.--If any officer or employee of the United States
intentionally compromises the determination or collection of any tax due
from an attorney, certified public accountant, or enrolled agent
representing a taxpayer in exchange for information conveyed by the
taxpayer to the attorney, certified public accountant, or enrolled agent
for purposes of obtaining advice concerning the taxpayer's tax
liability, such taxpayer may bring a civil action for damages against
the United States in a district court of the United States. Such civil
action shall be the exclusive remedy for recovering damages resulting
from such actions.
26
U.S.C. §7435. Simply put, Defendants point out that Plaintiff's claim
pursuant to Section 7435 involves Ms. Joan Martin with whom Plaintiff
claims that he is affiliated and Plaintiff's Complaint, as amended, does
not allege that Ms. Martin prepared his taxes, or that she was his power
of attorney, or that he conveyed any information to her "for
purposes of obtaining advice concerning the taxpayer's liability."
Id.
Defendants do not cite any case law for their proposition. Plaintiff
avers that Ms. Martin represented him regarding the assessment of
penalties in front of the IRS and Defendants were aware that she
represented him.
It
is not clear, accepting as true all the allegations contained in the
Complaint, as amended, and viewing the allegations therein in the light
most favorable to the plaintiff, that no relief could be granted
pursuant to 26 U.S.C. §7435. Because there remains a question as to
whether Ms. Martin "represented" Plaintiff for purposes of
this statute, or in what capacity she represented Plaintiff, it is
unclear that Plaintiff's claim does not fall within the purview of this
statute. Accordingly, the Court DENIES Defendants' Motion to Dismiss all
of Plaintiff's claims pursuant to 26 U.S.C. §7435.
6.
Plaintiff's Claim pursuant to 26 U.S.C. §7217
Plaintiff's
Complaint, as amended, includes a claim for a violation of 26 U.S.C. §7217.
Defendants move to dismiss this claim on the grounds that the statute is
only applicable to the President, Vice President, any employee of the
executive office of the President, any employee of the executive office
of the Vice President, or any individual other than the Attorney
General, serving in a position specified in 5 U.S.C. §5312. Plaintiff
did not respond to this portion of Defendants' Motion. Section 7217
provides:
It
shall be unlawful for any applicable person to request, directly or
indirectly, any officer or employee of the Internal Revenue Service to
conduct or terminate an audit or other investigation of any particular
taxpayer with respect to the tax liability of such taxpayer.
26
U.S.C. §7217. The Court agrees with Defendants's position, Section 7217
is not applicable to the present case. Therefore, pretermitting any
examination into Plaintiff's doubtful authority to enforce a criminal
statute, the Court finds that this statute is inapplicable to the
present suit and that Plaintiff has failed to state a claim.
Accordingly, the Court GRANTS Defendants' Motion to Dismiss all of
Plaintiff's claims pursuant to 26 U.S.C. §7217.
7.
Plaintiff's Claims against the individual Defendants
Defendants
argue that Plaintiff's claims against the named individual Defendants
are, in actuality, claims against the acts those Defendants took in
their official capacity as agents of the
United States
. As such, Defendants argue, Plaintiff's claims are really against the
United States
and the claims against the individual Defendants' should be dismissed.
Plaintiff responds that the individual Defendants are liable under Bivens.
14 Defendants
have not responded to this argument. 15 Because
Defendants' Motion does not address this matter, the Court declines to
grant Defendants' Motion at this time. Accordingly, the Court DENIES
Defendants' Motion to Dismiss all of Plaintiff's claims against the
individual Defendants.
D.
Plaintiff's Motion to Compel
Plaintiff
moves this Court to compel Defendants to file answers to the Mandatory
Interrogatories. Defendants correctly point out that they have filed a
Motion to Dismiss and until this Court rules on that Motion, Defendants
are not required to answer the Mandatory Interrogatories. Accordingly,
the Court DENIES Plaintiff's Motion to Compel [15].
E.
Plaintiff's Motion for Oral Argument
Plaintiff
requests the opportunity to orally argue the present Motion to Dismiss.
The Court perceives no reason to entertain oral arguments. Accordingly,
the Court DENIES Plaintiff's Motion for Oral Argument [20].
III.
CONCLUSION
For
the foregoing reasons, the Court GRANTS IN PART and DENIES IN PART
Defendant's Motion to Dismiss. The Court GRANTS Defendants' Motion as it
relates to
(1)
the claim for injunctive relief found in Count One of the Complaint;
(2)
the Freedom of Information Act ("FOIA") claim(s), 5 U.S.C. §552;
(3)
the claim(s) pursuant to 26 U.S.C. §7214; and
(4)
the claim(s) pursuant to 26 U.S.C. §7217.
These
claims are hereby dismissed. Defendants Motion as to all of the other
claims is DENIED but the Court grants Defendants leave to refile the
present Motion in relation to Plaintiff's remaining claims within
fifteen (15) days of receipt of Plaintiff's Amended Complaint.
The
Court hereby ORDERS Plaintiff within fifteen (15) days of receipt of
this Order to submit an amended complaint that:
(1)
specifically states which statutory violation(s) or cause(s) of action
are alleged in each of the counts contained in the Amended Complaint; 16 and
(2)
the alleged conduct on the part of Defendants that comprises said
violations.
It
is so ORDERED.
1
This Order grants Plaintiff's Motion to Amend his Complaint. As such,
the factual background herein reflects and includes the allegations
contained in the Complaint, as amended.
2
Plaintiff's Complaint, as amended, frequently refers to preparer
penalties "against Defendant." The Court believes Plaintiff is
meaning to refer to penalties assessed against himself and the Court
will, therefore, interpret these allegations as penalties assessed
against Plaintiff.
3
Although not explained, the Court assumes a "no change report"
is a decision on the part of the Appeals Division finding that, rather
than agreeing with the Macon Division's assessment increasing a
taxpayer's tax obligation, the assessment of tax should not be changed
from the taxpayer's original filing. The "no change report,"
in effect, overrules a Macon Division assessment that more tax is owed.
4
Plaintiff's less than artful explanation of this delaying tactic leaves
the Court in a quandary as to what exactly occurred. For the purposes of
this Motion, the Court will assume that Plaintiff's Complaint alleges
that Defendants, in violation of the IRS Code, purposefully delayed the
production of some report so that Plaintiff's clients were somehow
deprived of their rights, thereby causing harm to him and his practice.
5
Decisions of the former Fifth Circuit rendered prior to
October 1, 1981
are binding precedent in the Eleventh Circuit. Bonner v. City of
Prichard, 661 F.2d 1206, 1207 (11th Cir. 1981) (en banc).
6
Plaintiff argues that Defendants should be enjoined from auditing any of
Plaintiff's clients, any clients of any of Plaintiff's employees or
clients of any tax return preparers associated with Plaintiff. Count One
requests the Court to order Defendants to transfer all of Plaintiff's
clients' existing cases to offices other than the
Macon
,
Georgia
Division. The Count further requests the Court to prohibit any of the
Defendants from communicating with the IRS agents who may receive the
transferred cases. Plaintiff also requests that Defendant Minsico be
prohibited from supervising his cases.
7
Plaintiff's Complaint states: "Defendants [sic] Plaintiff's clients
to file complaints against Plaintiff, interfering with Plaintiff's
client relationships, accelerating third party summons to embarrass
Plaintiff and his clients when not necessary, and necessary [sic]
subjecting taxpayers to unnecessary examinations or
investigations." The Court includes language extracted from
Plaintiff's Complaint to ensure the Court has correctly summarized his
Complaint herein.
8
The exceptions enumerated in Subsection (a) are inapplicable here:
Section 1015 relates to the tax assessed to gifts or trusts; Sections
6212 and 6213 apply when a taxpayer seeks review by the Tax Court of a
notice of deficiency; Section 6225 relates to tax assessed against
partnership items; Section 6246 relates to adjustments made regarding
partnership items; Section 6331 relates to the authority of the IRS to
collect delinquent taxes; Section 6672(b) applies only when the
responsible person has filed a bond within thirty days of the assessment
to ensure collection; Section 6694 applies to certain return preparer
penalty proceedings; Section 7426 applies in certain third-party
wrongful levy actions and Section 7429 applies in proceedings to review
jeopardy assessments.
9
The case law holds that it must be clear that the government cannot win
"under the most liberal view of the facts and law." See
Smith v. Rich [82-1 USTC ¶9206], 667 F.2d 1228, 1230 (5th Cir.
1982).
10
For example, Count Two alleges that Defendants illegally contacted
Plaintiff's associate but does not state what statute that activity
violates. Count Two also alleges violations of Sections 7412 and 7435
but does not specify what activity comprised these violations. Count Two
of the Amended Complaint also alleges that Defendants' actions violate
the Taxpayer Bill of Rights and give rise to a Bivens claim but
does not elaborate on these assertions.
11
Plaintiff's Response conflates the FOIA, 5 U.S.C. §552, with the
Privacy Act of 1974, 5 U.S.C. §552a.
12
Defendants, in footnote, argue that §552a(g)(1)(D) does not apply to
the determination of a taxpayer's tax liability. Apparently Defendants
read Plaintiff's Complaint to allege a violation of this particular
provision. Although the Court understands why Defendants were confused
as to what Plaintiff was alleging pursuant to the Privacy Act of 1974,
the Court does not find that this argument is sufficient to dismiss
Plaintiff's claim pursuant to the Privacy Act of 1974, 5 U.S.C. §552a.
To the extent Defendants' Motion is moving to dismiss this claim, it is
DENIED.
13
Defendants' Motion confuses 26 U.S.C. §7412 with 26 U.S.C. §7214.
Plaintiff's Complaint, as amended, refers to both statutes. Because the
statutory language cited by Defendants is identical to that found in §7214,
the Court will assume that Defendants arguments address the claims by
Plaintiff pursuant to that statute even though Defendants cite "§7412"
in the title of this section of their Motion and at various other
junctures in their argument.
14
To find liability under Bivens a plaintiff must have proof of an
affirmative causal connection between the defendants acting and the
alleged constitutional deprivation. See Lojuk v. Quandt,
706 F.2d 1456 (7th Cir. 1983), cert. Denied, Lojuk v. Johnson,
474
U.S.
1067, 106 S.Ct. 822 (1986). A causal connection may be established by
proving that the defendant was personally involved in the act or
omission that led to a constitutional deprivation. Zatler v.
Wainwright, 802 F.2d 397, 401 (11th Cir. 1986). In addition, the
doctrine of respondeat superior does not apply in a Bivens
action. Lojuk, supra.
15
Plaintiff's Amended Complaint was filed after Defendants filed the
present Motion to Dismiss. The Amended Complaint included an allegation
that Defendants were liable under Bivens v. Six Unknown Named Agents
of the Federal Bureau of Narcotics, 403 U.S. 388, 91 S.Ct. 1999
(1971).
16
This Second Amended Complaint should not include allegations for the
claims pursuant to 5 U.S.C. §552, 26 U.S.C. §7214 and §7217,
dismissed herein. Plaintiff is, however, invited to state with more
clarity the claim, if any, for injunctive relief, and ordered to state
with more clarity his remaining claims.
[2000-1
USTC ¶50,278] Daniel L. Leveto, and Margaret A. Leveto, Plaintiffs v.
Robert A. Lapina, Richard W. Adams, Judy A. Graham, Suzi Hines,
"Joe Rivera", and ten unknown IRS agents, Defendants
U.S.
District Court, West.
Dist.
Pa.
, 98-143
Erie
,
2/5/2000
First Amendment: Seizure of documents.--A veterinarian's First
Amendment rights were not violated by the IRS's seizure of documentary
evidence from his business. He alleged only legal conclusions that he
was denied the use and benefits of his written property with the intent
to restrict his freedom of speech and that the investigation resulted
from his involvement with a tax protest group. The IRS agents who
conducted the search were entitled to qualified immunity regarding this
allegation.
Fifth Amendment: Custodial investigation: Deprivation of property.--IRS
agents had qualified immunity from a veterinarian's Fifth Amendment
claim arising out of his custodial interrogation and the agents' alleged
failure to provide his Miranda rights. His right against
self-incrimination did not apply in his suit for money damages as it
would in a criminal proceeding. Furthermore, he failed to state a claim
regarding deprivation of property in connection with documents that were
seized pursuant to lawful search warrants.
Miscellaneous constitutional attacks: Bivens-type claim: IRS
agents: Scope of authority: Damage to reputation.--To the extent
that a veterinarian claimed injury to his reputation based on IRS
agents' alleged questioning regarding weapons, he failed to state a Bivens
claim since even abusive verbal attacks do not violate the Constitution.
Moreover, even if IRS agents improperly carried firearms during the
search of his business premises, a Bivens action did not
automatically arise from a failure to follow IRS procedures.
[Code
Secs. 6103 and 7431
]
Disclosure of return information:
U.S.
as proper defendant.--A veterinarian who marketed a book promoting
the evasion of taxes failed to state a claim for unauthorized
disclosures of confidential information against various IRS agents. The
exclusive remedy for unauthorized disclosures is an action against the
U.S.
, rather than individual IRS agents.
[Code
Sec. 7206 ]
Sixth Amendment: Right to counsel: Attachment of right.--A
veterinarian's claim that his Sixth Amendment right to counsel was
violated by IRS agents when he was allegedly forbidden to have any
contact with an attorney during the search of his business premises was
dismissed. He was never formally charged with a tax offense and, thus,
had no clear right to an attorney.
[Code
Sec. 7206 ]
Fraud offenses: Conspiracy to evade taxes: IRS investigation: Search
warrants.--Search warrants issued in connection with an IRS
investigation of a veterinarian who marketed a book promoting the
evasion of taxes were sufficiently specific. The warrants limited the
search to documentary evidence related to violations of the Code
concerning possible conspiracy to evade taxes. The fact that the warrant
failed to name the taxpayer or his wife was not fatal to its validity
since it only had to identify the place to be searched and the targets
of seizure.
[Code
Sec. 7214 ]
Damages: IRS conduct: Search and seizure: No criminal conviction.--A
veterinarian who marketed a book promoting the evasion of taxes could
not recover damages against the agents in connection with the search of
his business and the seizure of documentary evidence under Code Sec. 7214 . No revenue
agent had been convicted of any crime in connection with his case.
[Code
Sec. 7402 ]
Fourth Amendment: Search and seizure: Qualified immunity: Warrant:
Affidavit in support of: Scope of warrant.--An IRS agent had
qualified immunity from liability in connection with a taxpayer's Fourth
Amendment claims arising out of the search of his business and the
seizure of documentary evidence. The agent's affidavit provided ample
probable cause to support the issuance of search warrants since it
included details of the IRS investigation of the taxpayer and
information given by confidential informants and outside sources. The
taxpayer's contention that the informants' statements were hearsay was
irrelevant; hearsay is permitted to establish probable cause for a
warrant. Further, there was no evidence that the agent misrepresented
any material fact in obtaining the warrant.
[Code
Sec. 7402 ]
District Court: Default judgment: Service of process.--A
veterinarian who filed a claim for damages against IRS agents who
searched his business and seized documents was not entitled to a default
judgment against agents who failed to respond to the complaint. The
agents were never served with process.
[Code
Sec. 7433 ]
Fourth Amendment: Search and seizure: Scope of search: Pat-down and
detention: Conspiracy.--IRS officers who conducted a search of a
veterinarian's business did not go beyond the scope of a valid warrant
in allegedly "ransacking" the taxpayer's office. That the
officers may have seized a large amount of documentation was reasonable
and did not rise to the level of a constitutional violation.
Furthermore, the agents' brief pat-down and detention of the taxpayer
and his wife at the search sites did not give rise to a Fourth Amendment
violation since it was reasonable under the circumstances. Additionally,
the taxpayer's claim that the agents conspired against him was dismissed
as insufficiently specific.
[Code
Sec. 7608 ]
Constitutional claims: Bivens-type claim: Search warrant:
Authority of CID.--A veterinarian who marketed a book promoting
strategies to avoid federal income taxes failed to state a Bivens-type
claim against IRS agents for violations of his constitutional rights
arising out of the search of his home and business. The reference in Code Sec. 7608 to
"Intelligence Division" did not limit the authority of an IRS
Criminal Investigation Division (CID) agent to present an affidavit of
probable cause for the search warrants.
OPINION
CAHILL,
JR., Senior District Judge:
This
is a Bivens 1 action
against various known and unknown IRS agents. Plaintiffs allege that the
defendants violated various constitutional and statutory rights of the
plaintiffs by conducting a search of their personal residence and
business premises. Presently before the court are defendants' motion to
dismiss, plaintiffs' motion for entry of default, plaintiffs'
"Motion for In Camera Review to Determine if Proper Procedures and
Safeguards Have Been Followed to Protect Electronically Monitored
Evidence", and plaintiffs' "Motion for Contempt and to Seek
Enforcement of Court Order."
I.
BACKGROUND
A.
Factual Allegations
1.
Lapina Affidavit
Plaintiff
Daniel L. Leveto is a veterinarian who practices out of the Langdon and
Leveto
Veterinary
Hospital
at
316 Conneaut Lake Road
,
Meadville
,
Pennsylvania
. Dr. Leveto was the main target of an undercover operation that began
in December of 1994. On
May 1, 1996
, IRS special agent Robert A. Lapina, who at that time had nearly nine
years' experience in the IRS's Criminal Investigation Division
("IRS-CID"), submitted a 27 page, signed affidavit
("Lapina Affidavit") to Magistrate Judge Susan Paradise
Baxter, explaining the history of the IRS-CID's still-ongoing
investigation into possible tax evasion by Dr. Leveto. The Lapina
Affidavit is attached as Exhibit B to plaintiffs' "Motion to Bring
Essential Evidence into Custody of the Court." 2 According to
the affidavit, Dr. Leveto and his wife, plaintiff Margaret A. Leveto,
file joint federal income tax returns. The Levetos were suspected of
willfully attempting to evade personal income tax liabilities, in
violation of 26 U.S.C. §7201, willfully making materially false income
tax returns for the years 1991 through 1994, in violation of 26 U.S.C.
§7206(1), and conspiracy to defraud the United States in violation of
18 U.S.C. §371.
Included
in the Lapina Affidavit is a description of a book entitled "Tax
Free, How the Super Rich Do It", written by Don Turner, also a
target of the investigation, who previously served 18 months in prison
for income tax related violations. Dr. Leveto stated to a confidential
informant that he (Dr. Leveto) was the only individual in the
United States
who was marketing this publication. He promoted the book to one
confidential informant and to the undercover agent, and later sold a
copy of this book to the undercover agent. The book advocates the use of
"colatos", which stands for (c)ommon (l)aw (t)rust
(o)rganizations, and advises that individuals can sell their business to
a foreign "colato" and then receive the profits from this
business in the form of non-income sources. The foreign
"colato" is responsible for filing a 1040 Non-Resident Alien
federal income tax return ("1040NR"). Instead of paying tax on
the profits, the foreign "colato" can elect to distribute
these profits to another foreign "colato", thereby converting
income earned in the
United States
to foreign source income.
The
IRS apparently had reason to suspect that Dr. Leveto, possibly with the
help of Mr. Turner, was practicing the tax-evasion techniques espoused
in this publication. For example, the undercover agent had numerous
conversations with Dr. Leveto about how to go about setting up a
"foreign colato." These conversations are detailed in the
Lapina Affidavit. According to the Lapina Affidavit, Dr. Leveto also
explained to a confidential informant that Dr. Leveto became involved in
an "association" which could help the confidential informant
reduce and/or eliminate paying income taxes. Dr. Leveto explained that
once he (Dr. Leveto) joined the "association," he sold his
business to either a person or organization, outside the
United States
. Leveto told the confidential informant that since the business was
sold, he receives only wages from this foreign individual/entity when in
reality he still controls all of the gross receipts of the veterinarian
business. Leveto told the confidential informant that as a result of
this, he pays only as much tax as he wants to. On another occasion, Dr.
Leveto stated to a confidential informant that he pays only what he
considers to be his "fair share" of taxes.
In
addition, the IRS learned that sometime in 1993, a certain advertisement
was placed in the Wall Street Journal, entitled "Hot New
Report Reveals A Unique Way to Legally Pay Zero Taxes and Totally
Eliminate Lawsuits." Anyone interested in responding to this
advertisement was directed to write to Center Company, Daniel Leveto
VMD, GM,
316 Conneaut Lake Road
,
Meadville
,
Pennsylvania
. This is the same address as Dr. Leveto's veterinarian business. The
same advertisement was found in the
November 20, 1995
issue of The Spotlight weekly newspaper, with interested parties
instructed to write to the same address described supra.
According
to the Lapina Affidavit, and consistent with Dr. Leveto's statements to
the confidential informant, Leveto had sold the veterinarian business to
an entity named Center Company on
July 31, 1991
. Center Company filed nonresident alien income tax returns for the
years 1991 and 1992, postmarked from the Turks and Caicos Islands,
British West Indies
. Both the 1991 and 1992 1040NRs reflect that all income was distributed
to a beneficiary, resulting in Center Company having no total, adjusted,
or taxable income. In 1992, 1993 and 1994 the Levetos reported zero
taxable income. The Lapina Affidavit details various expenditures by the
Levetos, including extravagant vacations and the purchases of airplanes
and cars. Leveto made admissions to the confidential informant and to
the undercover agent reflecting the fact that he was involved in nothing
more than a "charade or sham." Special agent Lapina stated
that Dr. Leveto was "well aware he can dictate whatever taxable
income he desires and then disguise the balance of funds he receives as
non-income sources utilizing 'debit cards' and a 'line of credit', which
he termed as a 'paper tiger.' " Lapina Affidavit at p. 26.
Special
agent Lapina explained in his affidavit that it has been his experience
that in order to determine an individual's correct taxable income,
indirect methods of proof must be utilized, including documentation of
assets, liabilities and expenditures. Such financial records are
typically kept at business locations and residences. Lapina Aff. ¶5.
The confidential informants, one-time friends of the Levetos, were able
to pinpoint the likely locations of such financial records. They
described the Leveto residence as having a home office with a computer,
file cabinet and safe. Mrs. Leveto had explained to one confidential
informant that her husband used the home computer for buying and selling
commodities. She also explained that Dr. Leveto had a computer at work
as well, which he uses for this same activity. During the course of
meetings with the undercover agent, Dr. Leveto admitted that he has
evidence of assets placed in a nominee name as well as instructions on
how "this whole process can be unwound", located in a safe.
As
a result of the Lapina Affidavit, the magistrate found that probable
cause existed to search plaintiff's home and business for evidence of
tax law violations. The searches were authorized and took place the next
day,
May 2, 1996
. The warrants are attached as Exhibit A to the Second Amended
Complaint. A descriptive list of items to be seized appears as Exhibit B
to the search warrants, and are attached to the warrants and
incorporated therein by reference. The Lapina Affidavit was placed under
seal until recently.
2.
Second Amended Complaint
The
allegations in the complaint are as follows. When Dr. Leveto arrived at
his place of business the morning of
May 2, 1996
, he was "rushed by several armed people from cars that followed
him into the parking lot." Second Amended Complaint at ¶20.
Special agent Lapina was armed and wearing a bullet proof vest, and
Leveto was patted down. Second Amended Complaint at ¶21. The agents
shouted "where are the weapons?" Second Amended Complaint at
¶21. Leveto was escorted into a small room and ordered not to answer
the phone or talk to anyone other than the agents. Second Amended
Complain at ¶22. Dr. Leveto was held there for one hour. Second Amended
Complaint at ¶22.
Dr.
Leveto was then ordered to accompany special agents Lapina, Adams and
two other unnamed agents to his home. Upon their arrival, Mrs. Leveto,
wearing only her nightgown, was also patted down. Second Amended
Complaint at ¶23. Under the supervision of special agent Hines, a
second set of agents remained at the Leveto residence for six hours and
seized thousands of documents, computer discs, personal mail, and other
personal records. Second Amended Complaint at ¶24.
Dr.
Leveto was ordered back to the veterinary hospital and held there for
six hours in one room, with escorted visits to the restroom. Second
Amended Complaint at ¶25. Dr. Leveto feared for his life and did not
challenge the heavily armed agents. Second Amended Complaint at ¶26.
During that time, Dr. Leveto was "interrogated" by special
agents Lapina and Adams, without a Miranda warning, and felt
obliged to cooperate because he feared for his life as a result of the
fact that the agents were armed and were "ransacking" the
business offices. Second Amended Complaint at ¶27. Dr. Leveto was not
permitted to call an attorney. Second Amended Complaint at ¶28.
Dr.
Leveto further alleges that his fellow employees were segregated,
questioned, and sent home, and that armed agents turned away clients in
the parking lot, claiming the facility was closed until further notice.
Second Amended Complaint at ¶29, 30. The agents loaded trucks with the
records of five companies, personal reading material, computer software,
research related to commodity trading, and also computer files relating
to the hospital, over 3,000 client medical and financial records. Second
Amended Complaint at ¶33, 34. Special agent Judy Graham made an
inventory of the items seized, which has been attached as Exhibit J to
the Second Amended Complaint. No weapons were found on the premises.
Second Amended Complaint at ¶36.
The
application for the search warrant and the affidavit of probable cause
were sealed by order of court. Until they were unsealed two years later,
the Levetos allege, Dr. Leveto had no idea of the crime he was suspected
of committing, other than a violation of 18 U.S.C. §371 (conspiracy to
impair, impede or obstruct the functions of the IRS). This is the
statutory violation cited on the search warrant. The Levetos admit that
they were shown a copy of the warrants prior to the searches, and that
they voluntarily consented to further searches of areas outside the
scope of the search warrant. In light of the suddenness of the searches,
however, they were confused by what was happening.
The
Levetos filed a motion for return of the seized property pursuant to
Fed.R.Crim.P. 41(e). After a hearing, at which the IRS refused to offer
testimony or evidence because the investigation was--and for all we
know, still is--ongoing, Magistrate Judge Baxter ordered that all items
seized in the two searches be returned. This order was entered on
August 4, 1998
.
B.
The Parties and Proceedings
On
April 29, 1998
, plaintiffs, Daniel L. Leveto and Margaret A. Leveto, filed a complaint
claiming violations of their constitutional rights Which allegedly
occurred during the procurement and execution of the search warrants.
The defendants at that time included special agents from the Internal
Revenue Service Robert A. Lapina, Richard W. Adams, Judy A. Graham, Suzi
Hines, "Joe Rivera" and "10 Unknown IRS Agents." On
May 14, 1998
, pursuant to court order, plaintiffs filed a twenty-nine count amended
complaint against the same defendants, this time deleting the amount of
unliquidated damages claimed, as is required by local rule.
Defendants
Lapina, Adams, Graham and Hines waived service of a summons, and they
subsequently filed a motion to dismiss plaintiffs' amended complaint.
According to counsel for defendants, plaintiffs failed to effectuate
service of process on any of the other defendants. Neither "Joe
Rivera" nor the ten unnamed defendants responded to plaintiffs'
amended complaint.
On
October 8, 1998
, Judge McLaughlin of this court heard oral argument concerning the
various motions then pending. The transcript of that argument
("Oral Arg. Tr.") (Doc. 43) is part of the record and has been
reviewed by this member of the court. Because the affidavit in support
of probable cause had only been recently unsealed, Judge McLaughlin
granted leave to allow plaintiffs to file a Second Amended Complaint,
which they did on
October 26, 1998
. The Second Amended Complaint has forty-nine counts and was drafted
with the benefit of legal counsel.
In
addition, to help clarify the names of the individuals who fit within
the category of "10 Unknown IRS Agents," Judge McLaughlin
ordered defendants' counsel to provide plaintiffs' counsel with the
names of all of the IRS special agents who participated in the search of
plaintiffs' home and business. At oral argument, defendants' counsel
represented to the court that the unnamed defendants would not attempt
to "duck service," and, as agreed, defense counsel later
provided the names. Plaintiffs moved to amend the Second Amended
Complaint's caption and allegations pertaining to the unnamed defendants
to include said individuals. We granted that motion on
November 5, 1998
(Doc. 48). However, plaintiffs have not yet served summons or complaint
on any of these individuals.
The
counts of the Second Amended Complaint will be discussed in more detail
infra, but generally can be grouped as follows. Counts 1 through 8, 48
and 49 allege violations of the First Amendment. Counts 9 through 28, 45
and 49 allege violations of the Fourth Amendment. Counts 29 through 35,
43, 44, 48 and 49 allege denial of due process in violation of the Fifth
Amendment. Counts 36 through 39 allege violations of the Sixth
Amendment's guarantee of right to counsel. Counts 40 through 42 allege
violations of the Thirteenth Amendment. There are also various statutory
claims sprinkled throughout the Second Amended Complaint.
Defendants
then filed the now-pending motion to dismiss the Second Amended
Complaint on
November 12, 1998
. It is their position that the legal arguments contained therein apply
equally to all named and unnamed defendants, whether they have been
served or not. On
November 13, 1998
, attorney Neil Price withdrew as counsel to plaintiffs. On
November 18, 1998
, Judge McLaughlin entered an order of recusal and the case was
transferred to the undersigned member of this court.
Plaintiffs,
appearing pro se, subsequently filed a brief in opposition to the
motion to dismiss the Second Amended Complaint, as well as a brief in
support of their "motion for in camera review."
On
March 22, 1999
, this member of the court held a status conference on this and other
consolidated cases, 3 at which
time we took under advisement all pending motions. We ordered the
government to turn over certain documents responsive to certain pending
FOIA requests. However, we heard no substantive argument at that time,
although the transcript of that conference is now part of the record.
On
July 12, 1999
, attorney William G. McConnell entered his appearance on behalf of the
plaintiffs. In that capacity he filed the "Motion for Contempt and
to Seek Enforcement of Court Order" with respect to one FOIA
request.
II.
DISCUSSION
A.
Standard for Motions to Dismiss
On
a Rule 12(b)(6) motion, the court is required to accept as true all
allegations in the complaint and all reasonable inferences that can be
drawn therefrom, and to view them in the light most favorable to the
nonmoving party. Oshiver v. Levin, Fishbein, Sedran & Berman,
38 F.3d 1380, 1384 (3d Cir. 1994). The question is whether the plaintiff
can prove any set of facts consistent with his allegations that will
entitle him to relief, not whether he will ultimately prevail. Hishon
v. King & Spalding, 467
U.S.
69, 73 (1984). While a court will accept well-pleaded allegations as
true for the purposes of the motion, it will not accept legal or
unsupported conclusions, unwarranted inferences, or sweeping legal
conclusions cast in the form of factual allegation. See Miree v.
DeKalb County
,
Ga.
, 433
U.S.
25, 27 n. 2 (1977). Moreover, the claimant must set forth sufficient
information to outline the elements of his claims or to permit
inferences to be drawn that these elements exist. See
Fed.R.Civ.P. 8(a)(2); Conley v. Gibson, 355
U.S.
41, 45-46 (1957). Matters outside the pleadings should not be
considered. This includes "any written or oral evidence in support
of or in opposition to the pleading that provides some substantiation
for and does not merely reiterate what is said in the pleadings."
Charles A. Wright, Arthur R. Miller, Federal Practice and Procedure
§1366 (West 1990).
"It
is well established that, even if a party does not make a formal motion
to dismiss, the court may, sua sponte, dismiss the complaint
where the inadequacy of the complaint is clear." Slater v.
Skyhawk Transp., Inc., 187 F.R.D. 185, 202 (D.N.J. 1999), quoting
Michaels v.
New Jersey
, 955 F.Supp. 315, 331 (D.N.J. 1996). A court may on its own
initiative enter an order dismissing the action provided that the
complaint affords a sufficient basis for the court's action. Bryson
v. Brand Insulations, Inc., 621 F.2d 556, 559 (3d Cir. 1980).
The
United States Court of Appeals for the Third Circuit has imposed a
heightened pleading standard in civil rights actions; complaints against
government officials in their personal capacity must "contain a
modicum of factual specificity, identifying the particular conduct of
defendants that is alleged to have harmed the plaintiffs." Colburn
v. Upper Darby Township, 838 F.2d 663, 666 (3d Cir. 1988), cert.
denied, 489
U.S.
1065 (1989). To satisfy this standard, a plaintiff must "allege the
specific conduct violating the plaintiff's rights, the time and place of
that conduct, and the identity of the responsible officials."
Id.
In a Bivens action against multiple federal defendants, "the
plaintiff must plead the personal involvement of each defendant with
specificity and with sufficient facts to overcome a likely defense of
immunity." See Baise v. Kaplin, 852 F.Supp. 268, 287 (D.N.J.
1994).
B.
Authority of Agent Lapina
At
the outset, plaintiffs argue that special agent Lapina lacked authority
to present the application and affidavit of probable cause, and thus,
the searches and seizures were void ab initio. See Counts 7, 8,
23, 24, 34, 35, 38, 39, 41, and 42. These allegations border on the
frivolous. Federal Rule of Criminal Procedure 41(a) states that a
federal magistrate may issue a search warrant "[u]pon the request
of a federal law enforcement officer or an attorney for the
government." A "federal law enforcement officer" is any
government agent who is engaged in the enforcement of the criminal laws
and is within the category of officers authorized by the Attorney
General to request the issuance of a search warrant. Fed.R.Crim.P.
41(h); 28 C.F.R. §60.2. There is no doubt that special agent Lapina's
primary responsibilities include the investigation of alleged criminal
violations under federal tax law, and that the Internal Revenue Code
grants him the authority to execute search warrants and to seize
property. 26 U.S.C. §7608(b)(2)(A).
Plaintiffs
are under the mistaken impression that because §7608 of the Internal
Revenue Code uses the term "Intelligence Division," rather
than Criminal Investigation Division, special agent Lapina lacked
authority to execute the search warrants. "Intelligence
Division" is the former name of the Criminal Investigation
Division. See U.S. v. Amerada Hess Corp. [80-1 USTC ¶9160], 619
F.2d 980, 982 (3d Cir. 1980); U.S. v. Garden State Nat'l Bank
[79-2 USTC ¶9632], 607 F.2d 61, 65 n. 3 (3d Cir. 1979); U.S. v.
Morgan [85-1 USTC ¶9397], 761 F.2d 1009, 1011 (4th Cir. 1985); U.S.
v. Silvestain [82-1 USTC ¶9159], 668 F.2d 1161, 1163 (10th Cir.
1982); U.S. v. Miller [81-2 USTC ¶9749], 660 F.2d 563, 565 n. 2
(5th Cir. 1981); U.S. v. Jones [80-2 USTC ¶9804], 630 F.2d 1073,
1081 n. 12 (5th Cir. 1980); U.S. v. Equitable Trust Co. [79-2
USTC ¶9653], 611 F.2d 492, 495 n. 1 (4th Cir. 1979).
Therefore,
Counts 7, 8, 23, 24, 34, 35, 38, 39, 41 and 42 are wrongly premised on
the notion that special agent Lapina knew or should have known that he
lacked authority to present an application and affidavit of probable
cause, and those portions of those counts will be stricken on the
grounds that they fail to state a claim upon which relief can be
granted.
C.
Bivens and Qualified Immunity
Under
limited circumstances, a federal official may be held liable for the
violation of a person's constitutional rights while acting in an
official capacity. In Bivens v. Six Unknown Named Agents of Federal
Bureau of Narcotics, 403 U.S. 388, 397 (1971), the Supreme Court
held that a plaintiff could recover money damages for Fourth Amendment
violations committed by federal agents. In order to state a Bivens
claim, the plaintiff must allege a specific deprivation of
constitutionally protected rights through specific allegations of fact
regarding defendants' conduct. Baker v. McCollan, 443
U.S.
137, 140 (1979). Subsequently, courts have expanded the Bivens
remedy to encompass violations of other constitutional provisions. The
Supreme Court, however, repeatedly has warned that federal courts should
exhibit caution in "extending Bivens remedies into new
contexts." F.D.I.C. v. Meyer, 510
U.S.
471, 484 (1994); Schweiker v. Chilicky, 487
U.S.
412, 421 (1988). The Supreme Court has held that plaintiffs must do much
more than simply allege that a provision of the Bill of Rights has been
violated. For instance, simply alleging a violation of the Due Process
Clause is not enough.
[O]ur
cases establish that the right the official is alleged to have violated
must have been "clearly established" in a more particularized,
and hence more relevant, sense: The contours of the right must be
sufficiently clear that a reasonable official would understand that what
he is doing violates that right. . . . [I]n the light of preexisting law
the unlawfulness must be apparent.
Anderson
v. Creighton, 483 U.S. 635 (1987), citing Mitchell v. Forsyth,
472
U.S.
511, 535 n. 12 (1985) and Malley v. Briggs, 475
U.S.
335, 344-45 (1986).
Defendants
argue that they are protected from liability under the doctrine of
qualified immunity. "[G]overnment officials performing
discretionary functions generally are shielded from liability for civil
damages insofar as their conduct does not violate clearly established
statutory or constitutional rights of which a reasonable person would
have known." Harlow v. Fitzgerald, 457
U.S.
800, 818 (1982); see also Anderson, 483
U.S.
at 638. Under
Harlow
, this determination requires an objective analysis. Stoneking v.
Bradford
Area Sch. Dist., 882 F.2d 720, 726 (3d Cir. 1989). Plaintiffs have
the burden of showing a prima facie case of defendants' knowledge
of impropriety, actual or constructive. Davis v. Scherer, 468
U.S.
183, 191 (1984). The defense of qualified immunity is a recognition of
the fact that subjecting public officials to personal liability for
their discretionary actions results in the distraction of those
officials from their public duties, inhibits their discretionary
actions, and, quite possibly, deters qualified people from accepting
public service. Harlow, 457
U.S.
at 815.
The
case law instructs that, in analyzing the defendants' claim of qualified
immunity, we must first make a threshold determination of whether the
constitutional rights asserted by the plaintiff were "clearly
established" at the time the defendant officials acted, and whether
the plaintiffs have asserted a violation of a constitutional right at
all. Giuffre v. Bissell, 31 F.3d 1241, 1255 (3d Cir. 1994). We
must then further inquire whether a reasonable person in the official's
position at the relevant time could have believed, in light of what was
in the decided case law, that his conduct would be unlawful. Good v.
Dauphin
County
Social Servs. for Children and Youth, 891 F.2d 1087, 1092 (3d Cir.
1989). Qualified immunity protects "all but the plainly incompetent
or those who knowingly violate the law." Malley, 475
U.S.
at 341.
One
of the purposes of the qualified immunity standard is to protect public
officials from the "broad-ranging discovery that can be peculiarly
disruptive of effective government." Anderson, 483
U.S.
at 646 n. 6. For this reason, "qualified immunity should be
resolved at the earliest possible stage of the litigation."
Id.
"Unless the plaintiff's allegations state a claim for violation of
clearly established law, a defendant pleading qualified immunity is
entitled to dismissal before commencement of discovery." Mitchell,
472
U.S.
at 526.
1.
The Fourth Amendment
The
Fourth Amendment provides:
The
right of the people to be secure in their persons, houses, papers, and
effects, against unreasonable searches and seizures, shall not be
violated, and no Warrants shall issue, but upon probable cause,
supported by Oath or affirmation, and particularly describing the place
to be searched and the person or things to be seized.
U.S.
Const. Amend. IV.
The
plaintiffs allege that their Fourth Amendment rights were violated for
numerous reasons, including perceived defects in the warrants, the
nature and reliability of the information contained in the Lapina
Affidavit, the lack of probable cause for their issuance, the breadth of
the warrants, the scope of the search, and the fact that they were
patted down.
At
the outset, we note that we are in an unusual posture: this case
challenges the constitutionality of a search and seizure, yet the
Levetos have not been indicted. Should criminal charges be brought, they
will be entitled to a suppression hearing on many of the issues infra.
We do not intend this decision to have any preclusive effect on any
subsequent criminal matters involving the same facts and parties.
a.
Probable Cause
A
valid search warrant may issue only upon the showing to the issuing
authority that there is probable cause for the search. To determine
whether probable cause exists, the magistrate is required to make a
"practical, common sense decision" whether, given the
circumstances, there is "a fair probability that contraband or
evidence of a crime will be found in a particular place."
Illinois
v. Gates, 462
U.S.
213, 238 (1983). The decision is based upon the totality of the
circumstances, and doubtful cases are to be resolved in favor of
upholding the warrant.
Id.
at 237; see
United States
v. Sleet, 54 F.3d 303 (7th Cir. 1995). "[P]robable cause is a
fluid concept--turning on the assessment of probabilities in particular
factual contexts--not readily, or even usefully, reduced to a neat set
of legal rules." Gates, 462
U.S.
at 232. A deciding judge deals with probabilities, not technicalities,
when deciding whether to issue a warrant.
Id.
A sufficient nexus between the items to be seized and the place to be
searched may be established by direct evidence or by inferences.
United States
v.
McKinney
, 758 F.2d 1036, 1043 (5th Cir. 1985);
United States
v. Malin, 908 F.2d 163, 165 (7th Cir. 1990). Even if a reviewing
court would not have found probable cause for issuance of a search
warrant, it must nevertheless uphold the warrant so long as the issuing
magistrate's determination was made consistent with the minimal
substantial basis standard. United States v. Conley, 4 F.3d 1200,
1205 (3d Cir. 1993), cert. denied, 510
U.S.
1177 (1994).
The
case of United States v. Williams, 124 F.3d 411, 420 (3d Cir.
1997), cert. denied, 522 U.S. 1051 (1998), instructs that the
supporting affidavit to a search warrant application must be read in its
entirety and in a common sense and nontechnical manner. See Conley,
4 F.3d at 1206. The affidavit need not contain direct evidence that
proof of wrongdoing would be present at the premises.
Id.
at 1207. "Instead, probable cause can be, and often is, inferred by
'considering the type of crime, the nature of the items sought, the
suspect's opportunity for concealment and normal inferences about where
a criminal might hide [the] property.' " Id., quoting United
States v. Jones, 994 F.2d 1051, 1056 (3d Cir. 1993). The focus
should be on what the affidavit includes, rather than on what it does
not include.
Id.
at 1208. Even where a misrepresentation or an omission is included in an
affidavit, the affidavit may nevertheless support the valid warrant if
information contained in the affidavit, independent of the defective
portion, supports a probable cause finding. United States v. Frost,
999 F.2d 737, 742-43 (3d Cir. 1993), cert. denied, 510
U.S.
1001 (1993). This is true even where the misrepresentation or omission
is made intentionally or knowingly, or made with reckless disregard for
the truth.
Id.
We
find that, as a matter of law, the Lapina Affidavit, when read in its
entirety, provides ample probable cause to support