Daniel A. Guy, Jr. Special Trial Judge
ORDER
Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is
ORDERED that the Clerk of the Court shall transmit herewith to petitioner and to respondent a copy of the pages of the transcript of the trial in the above captioned case before Special Trial Judge Daniel A. Guy, Jr., at Philadelphia, Pennsylvania, on April 19, 2021, containing his oral findings of fact and opinion rendered at the trial session at which the case was heard.
In accordance with the oral findings of fact and opinion, an appropriate order and decision will be entered.
(Signed) Daniel A. Guy, Jr.
Special Trial Judge Bench Opinion by Judge Daniel A. Guy, Jr. April 22, 2021
THE COURT: The Court has decided to render oral findings of fact and opinion in this case, and the following represents the Court's oral findings of fact and opinion. The oral findings of fact and opinion shall not be relied upon as precedent in any other case.
This proceeding for review of a final determination disallowing petitioner's claim for interest abatement is a small tax case conducted pursuant to the provisions of section 7463 of the Internal Revenue Code of 1986, as amended, and Rules 170 through 174 of the Tax Court Rules of Practice and Procedure.
This bench opinion is made pursuant to the authority granted by section 7459(b) of the Internal Revenue Code of 1986, as amended, and Rule 152 of the Tax Court Rules of Practice and Procedure. Hereinafter in this bench opinion, section references are to the Internal Revenue Code of 1986, as amended, and Rule references are to the Tax Court Rules of Practice and Procedure.
Petitioner appeared at trial pro se. Nicholas Lyskin appeared on behalf of respondent. The parties filed with the Court a stipulation of facts, with accompanying exhibits, that is incorporated herein by this reference. The primary issue for decision is whether respondent abused his discretion in disallowing petitioner's claim for abatement of interest for the taxable years 2014, 2015, and 2016 (years in issue).
Background
Petitioner filed Federal income tax returns for the years in issue, the IRS commenced examinations of those returns, and timely issued notices of deficiency to petitioner determining adjustments that would result in additional tax, penalties, and interest for the years in issue.
Petitioner did not timely file petitions for redetermination with the Court challenging the notices of deficiency for the years in issue. In due course, the IRS assessed the tax, penalties, and interest attributable to the adjustments determined in the notices of deficiency. The IRS entered the assessments for 2014, 2015, and 2016 on August 14, 2017, July 16, 2018, and December 10, 2018, respectively.
By letter dated September 13, 2018, petitioner submitted to the IRS separate Forms 843, Claim for Refund and Request for Abatement, for the years in issue.
Petitioner did not allege in any of the Forms 843 that an IRS officer or employee was responsible for an unreasonable error or delay in the performance of a ministerial or managerial act. On February 13, 2019, the IRS issued a final determination to petitioner disallowing his claim for abatement of interest for the years in issue.
On February 25,2019, petitioner filed a petition with the Court stating that he was seeking "to resolve IRS tax audits for tax years 2014, 2015, and 2016" and he attached numerous IRS notices and letters, including the final determination dated February 13, 2019, disallowing his claim for interest abatement for the years in issue.
On January 8, 2021, petitioner filed several declarations with the Court, one of which he filed as a motion to restrain assessment or collection or to order refund of amount collected.
By Order issued March 1, 2021, the Court granted respondent's motion to dismiss for lack of jurisdiction, filed February 12, 2021, requesting that the Court dismiss so much of the petition as purported to challenge notices of deficiency for the years in issue on the ground the petition was not filed within the time prescribed in section 6213(a). The Court acknowledged in its Order that petitioner had timely invoked the Court's jurisdiction under section 6404(h) to review the final determination letter disallowing his claim for interest abatement
Discussion
Section 6601(a) provides the general rule that interest shall be paid on any tax imposed under the Internal Revenue Code that is not otherwise timely paid. The Court's authority to review interest assessed under section 6601 is quite limited. See Urbano v. Commissioner, 122 T.C. 384, 390 (2004).
As is relevant here, section 6404(h) authorizes the Court to review an action brought by a taxpayer to determine whether the Commissioner's failure to abate interest under that section was an abuse of discretion. See Woodral v. Commissioner, 112 T.C. 19, 23 (1999).
Section 6404(e)(1)(A) authorizes the Commissioner to abate an assessment of interest on a tax deficiency when the interest is "attributable * * * to any unreasonable error or delay by an officer or employee of the Internal Revenue Service * * * in performing a ministerial or managerial act". A ministerial act is "a procedural or mechanical act that does not involve the exercise of judgment or discretion, and that occurs during the processing of a taxpayer's case after all prerequisites to the act, such as conferences and review by supervisors, have taken place." Sec. 301.6404-2(b)(2), Proced. & Admin. Regs. A managerial act is "an administrative act that occurs during the processing of a taxpayer's case involving the temporary or permanent loss of records or the exercise of judgment or discretion relating to management of personnel." Id. subpara. (1).
Petitioner asserts that it would be neither fair nor just to permit respondent to assess penalties and interest in this case because he never intended to avoid paying taxes for the years in issue. Although we have no reason to doubt that petitioner did not set out to avoid paying taxes, he has failed to show an abuse of discretion related to interest abatement.
The record shows that the IRS acted in a timely and reasonable manner and followed appropriate procedures in examining petitioner's tax returns, issuing notices of deficiency, and entering assessments for the years in issue. Likewise, although it took some time to resolve the jurisdictional questions presented by the wide ranging and vague petition that petitioner filed to initiate this action, there is no indication of an unreasonable error or delay by an IRS officer or employee in performing a ministerial or managerial act within the meaning of section 6404 in this case.
At trial, the Court directed petitioner's attention to the motion to restrain assessment or collection that he filed on January 8, 2021. Petitioner was uncertain why he filed the motion. In any event, the Court has reviewed the record and finds no evidence of any improper assessment or collection activity.
Consistent with the foregoing, the Court will enter an Order and Decision denying petitioner's motion to restrain assessment or collection and sustaining the final determination disallowing petitioner's claim for abatement of interest. This concludes the Court's oral findings of fact and opinion in this case.
(Whereupon, at 10:08 a.m., the above-entitled matter was concluded.)
CERTIFICATE OF TRANSCRIBER AND PROOFREADER
We, the undersiecond method: low end of 48 kilograms of cocaine base); id. ¶ 143(c) (third method: "conservative estimate" of 78.9 kilograms of cocaine base during span of conspiracy); id. ¶¶ 216-17 (probation office agrees defendant responsible for entire amount of crack and powder cocaine trafficked by the Quinn drug trafficking organization); Transcript Of Sentencing (Doc. #757) at 16-19 (court adopted government's calculations and held defendant accountable for at least 8.4 kilograms of cocaine base based on "reasonably foreseeable quantities of drugs trafficked by [defendant] and his co-participants in furtherance of the jointly undertaken criminal activity. . . that occurred within the scope of his agreement to participate"). After Amendment 782, defendant's total offense level is reduced only two levels, to a total of 40 under the amended Guidelines. See U.S. Sent'g Guidelines Manual ("U.S.S.G.") § 2D1.1(c)(2) (Nov. 1, 2018 ed.) (base offense level of 36 for at least 8.4 kilograms but less than 25.2 kilograms of cocaine base, plus two levels because he possessed firearm during offense, plus two additional levels because he distributed drugs within 1000 feet of school property). With a criminal history category of IV (as argued by defendant) or VI (as applied at his original sentencing), defendant's guideline range remains the same: 360 months to life in prison. Because Amendment 782 did not lower defendant's sentencing range, the Court dismisses his unopposed motion under Section 3582(c)(2).
II. Compassionate Release
Defendant seeks compassionate release because of various health conditions and the COVID-19 pandemic. The parties agree that defendant has exhausted administrative remedies. Under the compassionate release statute, the Court may grant relief if defendant establishes that (1) extraordinary and compelling reasons warrant a reduced sentence, (2) a reduced sentence is consistent with applicable Sentencing Commission policy statements and (3) the Section 3553(a) factors warrant a reduced sentence. 18 U.S.C. § 3582(c)(1)(A); United States v. Maumau, 993 F.3d 821, 831 (10th Cir. 2021); United States v. McGee, 992 F.3d 1035, 1042-43 (10th Cir. 2021). The Sentencing Commission has not issued an "applicable" policy statement for motions for compassionate release filed by defendants. Maumau, 993 F.3d at 837; McGee, 992 F.3d at 1050. Unless and until the Sentencing Commission issues such a policy statement, the second requirement does not apply. See United States v. Warren, No. 11-20040-01-WPJ, 2021 WL 1575226, at *2 (D. Kan. Apr. 22, 2021). Accordingly, the Court evaluates only the first and third requirements.
A. Extraordinary And Compelling Reasons For Release
The Court has discretion to independently determine whether a defendant has shown "extraordinary and compelling reasons" that warrant release. See McGee, 992 F.3d at 1044, 1048. In the context of compassionate release, "extraordinary" means "exceptional to a very marked extent." United States v. Baydoun, No. 16-20057, 2020 WL 4282189, at *2 (E.D. Mich. July 27, 2020) (quoting extraordinary, Webster's Third International Dictionary, Unabridged (2020)). "Compelling" means "tending to convince . . . by forcefulness of evidence." Id. (quoting compelling, Webster's Third International Dictionary, Unabridged (2020)). The Court also considers how the Sentencing Commission has defined extraordinary and compelling reasons for BOP motions. See United States v. Carr, No. 20-1152, 2021 WL 1400705, at *4 (10th Cir. Apr. 14, 2021) (district court has discretion to consider definition of extraordinary and compelling reasons in Section 1B1.13 application notes). For BOP motions, the Sentencing Commission has identified four reasons that may constitute grounds for compassionate release: (1) defendant's medical condition; (2) defendant's age; (3) defendant's family circumstances; and (4) a catchall category for an "extraordinary and compelling reason other than, or in combination with," the first three categories. U.S.S.G. § 1B1.13, Reduction In Term Of Imprisonment Under 18 U.S.C. § 3582(c)(1)(A) (Policy Statement), cmt. n.1 (Nov. 2018).
Here, defendant seeks release in part because of his medical conditions. At age 39, defendant is young. Defendant has asthma, prediabetes and hypertension, which elevate his risk of contracting COVID-19 or suffering severe illness from it. The government concedes that under Department of Justice guidelines, defendant's medical conditions establish extraordinary and compelling reasons. Even so, the Court finds that defendant's medical conditions and the conditions at FCI Bennettsville, individually and collectively, do not constitute extraordinary and compelling reasons for a reduced sentence. Nearly half of the inmate population at FCI Bennettsville is fully inoculated with a COVID-19 vaccine. Defendant has not shown that compared to his proposed placement in the community, he faces a heightened or imminent risk of exposure to COVID-19 at FCI Bennettsville. See United States v. Wright, No. CR-TDC-17-0388, 2020 WL 2571198, at *3 (D. Md. May 21, 2020) (inmate must show imminent risk of exposure to COVID-19 and high risk for death or serious illness should he or she contract COVID-19 based on age, medical conditions or other factors). COVID-19 certainly presents a challenge in the prison setting, where inmates generally live in close quarters. Even so, the risk that COVID-19 may reemerge at FCI Bennettsville cannot "justify compassionate release, especially considering BOP's statutory role, and its extensive and professional efforts to curtail the virus's spread." United States v. Raia, 954 F.3d 594, 597 (3d Cir. 2020).
Defendant next argues that extraordinary and compelling reasons exist because if sentenced today, he would only be subject to a statutory maximum of 240 months under Section 841(b)(1)(C), which is lower than his guideline range of 360 months to life. Reply (Doc. #1096) at 3 (citing Alleyne v. United States, 570 U.S. 99 (2013)). Because the jury instructions required the jury to find that "[t]he overall scope of the agreement involved more than 5 kilograms of cocaine or more than 280 grams of cocaine base ("crack cocaine")," the Court properly sentenced defendant on Count 1 under the statutory penalties under Section 841(b)(1)(A), i.e. ten years to life. Instructions To The Jury (Doc. #562) filed August 26, 2011, No. 20. As to Count 4 (conspiracy to maintain a residence to distribute cocaine base within 1000 feet of school property), the statutory range was one to 40 years in prison. Even if defendant were subject to a statutory maximum of 20 years on Counts 1 and 4, he has not shown that his operative sentence would be limited to 20 years. First, because defendant had a prior "felony drug offense," the statutory maximum on Count 1 would be 30 years. 21 U.S.C. § 841(b)(1)(C). Moreover, where a defendant is convicted of multiple offenses, the Sentencing Guidelines specifically instruct district courts to stack sentences where the sentence determined within the guideline range (here 420 months) exceeds the statutory maximum on a single count of conviction. Accordingly, defendant has not shown that if sentenced today, he would face a lower sentence for his offenses.
In United States v. Dahda, 853 F.3d 1101 (10th Cir. 2017), the Tenth Circuit rejected a sentence challenge based on the failure of the verdict form to include a specify quantity of marijuana. Id. at 1116-17. The Tenth Circuit explained that the verdict form did not need to include such information because the jury instructions included as an element of the crime that the "overall scope of the agreement involved more than 1000 kilograms of marijuana," which was sufficient to trigger the higher statutory penalties. Id.; see also United States v. Collazo, 984 F.3d 1308, 1336 (9th Cir. 2021) (en banc) (defendant convicted of conspiracy under § 846 is subject to enhanced statutory penalties under § 841(b)(1)(A)-(B) if government proved beyond reasonable doubt underlying § 841(a)(1) offense "involved" drug type and quantity set forth in § 841(b)(1)(A)-(B)). Defendant cites a later panel decision in United States v. Ellis, 868 F.3d 1155 (10th Cir. 2017), which involved a challenge to the statutory minimum in Section 841(b)(1)(A). To the extent that Ellis applies and conflicts with Dahda, the earlier decision in Dahda controls. See United States v. Dahda, 842 F. App'x 243, 246 (10th Cir. Jan. 8, 2021) ("when two panel decisions conflict—the earlier decision controls") (quoting United States v. Reese, 745 F.3d 1075, 1083 (10th Cir. 2014)).
Defendant contends that the jury did not make a finding that he committed the offense within 1000 feet of a school. By finding him guilty of Count 4, the jury specifically found that this element was satisfied. See Instructions To The Jury (Doc. #562) filed August 26, 2011, No. 28 (to find defendant guilty, jury must find that he agreed to maintain residence to distribute cocaine base "within 1,000 feet of the real property comprising Northwest Middle School").
Defendant also argues that the government did not present sufficient evidence to establish that the distance from "a school" to the precise location where drugrelated activity occurred in the residence was within 1000 feet. Reply (Doc. #1096) at 4. The statute, however, only requires that the distance between the "real property comprising" a school and the drugrelated activity be within 1000 feet. 21 U.S.C. § 860(a); see United States v. Soler, 275 F.3d 146, 155 n.5 (1st Cir. 2002) (government measurement likely overstates distance because it started at school building itself, rather than at real property comprising school). The government presented adequate evidence to satisfy this element. See Transcript Of TrialVolume II (Doc. #718) at 433, 450 (Officer David Weaver testified that distance between school parking lot and furthest most point of structure at 2636 North 20th was 938 feet; structure at 2632 North 20th charged in Count 4 was even closer).
See U.S.S.G. § 5G1.2(d) (if sentence imposed on count carrying highest statutory maximum less than total punishment, then sentence imposed on one or more other counts shall run consecutively to extent necessary to produce combined sentence equal to total punishment); U.S.S.G. § 5G1.2(d), cmt. n.1 (if no count carries adequate statutory maximum, consecutive sentences to be imposed to extent necessary to achieve total punishment); see also 18 U.S.C. § 3584 (if multiple terms of imprisonment imposed at same time, court may run terms concurrently or consecutively); United States v. Ivory, 532 F.3d 1095, 1107-08 (10th Cir. 2008) (hardly unreasonable to "stack" statutory sentences to reach presumptively reasonable guideline sentence). --------
While defendant's stated reasons do not constitute extraordinary and compelling reasons for a reduced sentence, the Court finds that its denial of relief to defendant under Amendment 782 is an extraordinary and compelling reason. As to the two other co-defendants who went to trial (Mark Brooks and Marcus Quinn), the Court granted relief under Amendment 782 because at sentencing, it found that each defendant was accountable for at least 4.5 kilograms of cocaine base. See Order Regarding Motion For Sentence Reduction [As To Mark Brooks] Pursuant To 18 U.S.C. § 3582(c)(2) (Doc. #1084) filed February 4, 2021 (reducing sentence from 420 months to 360 months); Order Regarding Motion For Sentence Reduction [As To Marcus Quinn] Pursuant To 18 U.S.C. § 3582(c)(2) (Doc. #1079) filed January 21, 2021 (reducing sentence from 360 months to 292 months). Here, defendant is not eligible for relief because at sentencing, in response to his objection, the Court made specific findings that he was accountable for at least 8.4 kilograms of cocaine base, which was the threshold for a base offense level 38. Absent an objection, the Court likely would have adopted the quantity specified in the presentence report, i.e. at least 4.5 kilograms of cocaine base, which was based on a prior version of the Guidelines Manual. See PSR, ¶ 150. The Court also applied this same quantity estimate for Marcus Quinn and Brooks, who both had significant involvement in the conspiracy. In other words, absent a reduced sentence and based primarily on the fact that defendant objected at sentencing, he will face a comparably higher sentence than similarly situated co-defendants such as Brooks, who also initially received a sentence of 420 months. Accordingly, the Court finds that the uneven application of Amendment 782 to the various defendants who had similar involvement in the conspiracy is an extraordinary and compelling reason for a reduced sentence.
B. Section 3553(a) Factors
The government argues that after balancing the Section 3553(a) factors, the Court should deny release. The Court agrees that a sentence of time served—a reduction of nearly 20 years—is inconsistent with the seriousness of defendant's offense, the need for deterrence and the need to protect the public. Defendant committed a significant drug trafficking offense. Defendant and others trafficked a significant amount of crack and powder cocaine within 1000 feet of a middle school. Defendant has a lengthy criminal record including battery of a law enforcement officer. See PSR, ¶¶ 159-76. Defendant also has had several disciplinary incidents in prison. See Attachment A to Government's Response To Defendant's Motion For Compassionate Release (Doc. #1094). For example, in September of 2019, defendant was disciplined for possessing a dangerous weapon. Id. at 2. The Court recognizes that defendant has completed a significant portion of his original sentence and apparently has made some progress toward rehabilitation. On balance, however, the factors under Section 3553(a) do not support a sentence of time served.
Even though a time served sentence is not appropriate, the Court finds that a reduced sentence of 330 months is sufficient, but not greater than necessary, to reflect the seriousness of the offense, afford adequate deterrence, protect the public and provide defendant needed treatment in the most effective manner. See 18 U.S.C. § 3553(a)(2)(A)-(D). Such a reduction is particularly appropriate in light of the relief that the Court awarded to similarly situated co-defendants under Amendment 782. On defendant's unopposed motion under Amendment 782, the government agreed that a sentence of 330 months is appropriate under the Section 3553(a) factors. Such a sentence is commensurate with the reduced sentences which the Court imposed on Marcus Quinn and Brooks. Indeed, at defendant's sentencing, the Court specifically noted that after balancing the various sentencing factors, defendant should receive the same sentence as Brooks, i.e. 420 months in prison. See Transcript Of Sentencing (Doc. #757) at 49. Now that the Court has reduced the sentence for Brooks to 330 months, a corresponding reduction is appropriate for defendant.
IT IS THEREFORE ORDERED that defendant's Unopposed Motion For Sentence Reduction Under 18 U.S.C. § 3582(c)(2) (Doc. #1087) filed March 17, 2021 is DISMISSED.
IT IS FURTHER ORDERED that defendant's Motion To Reduce Sentence For Compassionate Release (Doc. #1085) filed March 5, 2021 is SUSTAINED in part. The Court reduces defendant's sentence to 330 months. Except as modified above, all other terms and conditions of the Judgment In A Criminal Case (Doc. #691) filed January 27, 2012 shall remain in effect.
Dated this 30th day of April, 2021 at Kansas City, Kansas.
s/ Kathryn H. Vratil
KATHRYN H. VRATIL
United States District Judge