United States District Court, D. Hawaii
FINDINGS AND RECOMMENDATION TO GRANT THE UNITED
STATES OF AMERICA'S PETITION TO ENFORCE INTERNAL REVENUE
Kenneth J. Mansfield United States Magistrate Judge.
January 25, 2017, Petitioner United States of America
(“Petitioner”) filed a Petition to Enforce
Internal Revenue Service Summons (“Petition”)
served upon Respondent Richard A. Takase
(“Takase”). ECF No. 1. The Petition included a
declaration of Revenue Officer Martin L. Humpert
(“Humpert Declaration”) and an Internal Revenue
Service (“IRS”) summons served upon Takase on
April 1, 2016 (the “Summons”). Id. On
January 27, 2017, the Court issued an Order to Show Cause
(“Order to Show Cause”) ordering Takase to appear
to show cause, if there be any, why he should not be
compelled to comply with the Summons. ECF No. 4.
matter first came on for hearing on March 1, 2017. Assistant
United States Attorney Harry Yee appeared on behalf of
Petitioner. Takase appeared pro se. At the hearing
the parties advised the Court that they were working on a
resolution and jointly requested a five-month continuance,
which the Court granted.
matter came on for further hearing on August 8, 2017.
Assistant United States Attorney Harry Yee appeared on behalf
of Petitioner along with Internal Revenue Service Revenue
Officer Martin L. Humpert. Takase appeared pro se.
The parties were unable to resolve the Petition by agreement.
careful consideration of the Petition, briefs, declarations,
exhibits, and arguments of the parties in their written
submissions and during the hearing, and being fully advised
in the matter, the Court FINDS and RECOMMENDS that the
Petition be GRANTED and the Summons be enforced.
April 1, 2016, in accordance with Internal Revenue Code
section 7603, IRS Officer Martin Humpert served an attested
copy of the Summons on Takase by handing a copy of the
Summons to Takase. ECF No. 1-1. The Summons requested
Takase's documents and records related to his financial
affairs for the period October 1, 2015 to March 31, 2016, and
his Form 1040 for the calendar years 2002, 2003, 2004, 2005,
2006, 2007, 2008, and 2009. Id. The Summons directed
Takase to appear before Humpert with these materials on May
5, 2016. Id. Takase appeared on May 5, 2016, but he
did not provide all summoned information. Id.
Petitioner responded by filing the instant Petition.
obtain enforcement of a summons, the IRS need only make a
prima facie showing of good faith in the issuance of
the summons. See Lidas Inc. v. United States, 238
F.3d 1076, 1082 (9th Cir. 2001). A showing of good faith is
based upon the four requirements set forth in United
States v. Powell, which requires the IRS to show that:
(1) the investigation is conducted for a legitimate purpose;
(2) the inquiry may be relevant to that purpose; (3) the
information requested is not already in the possession of the
IRS; and (4) the administrative steps required by the
Internal Revenue Code have been followed. United States
v. Powell, 379 U.S. 48, 57-58 (1964). Declarations or
affidavits by directors or agents generally satisfy the
requirements set forth in Powell. See
Lidas, 238 F.3d at 1082 (citing United States v.
Stuart, 489 U.S. 353, 360-61 (1989)).
instant case, Petitioner has established that the Summons
complies with the four elements of the Powell
standard. The Humpert Declaration establishes that the
Summons was issued for a legitimate purpose, that is, in an
effort to determine Takase's correct federal income tax
liabilities for the years at issue. Moreover, the court is
satisfied that the information sought through the Summons is
relevant to the inquiry into Takase's correct tax
liability for those years and that the information sought is
not within the IRS' possession. Finally, the court finds
that all administrative requirements have been met.
the United States has established its prima facie
case, and the burden now falls upon Takase to
“‘challenge the summons on any appropriate
ground.'” Powell, 379 U.S. at 58 (quoting
Reisman v. Caplin, 375 U.S. 440, 449 (1964)). The
objecting party must allege specific facts and evidence to
support allegations of bad faith or improper purpose. See
Crystal v. United States, 172 F.3d 1141, 1144 (9th Cir.
1999). Moreover, where the government must meet only a
minimal threshold to demonstrate relevance and purpose, the
burden on the objecting party to prove government wrongdoing
is significantly greater. See United States v.
Stuckey, 646 F.2d 1369 (9th Cir. 1981). Takase has not
provided any legal or factual basis to disprove
Petitioner's prima facie case. Nor is the Court
aware of any facts or evidence that would support such a
on the foregoing, this Court FINDS AND RECOMMENDS that the
Petition be GRANTED and the Summons be enforced in full.
Takase shall also, as part of his compliance with the
Summons, provide Petitioner with: (i) the name of the company
or individual who stored his financial records prior to their
alleged disposal; (ii) his credit union account information
referenced during the hearing, including the credit union
account name, number, and address; (iii) the name and contact
information for his accountant; and (iv) written