IN THE UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF COLORADO
UNITED STATES OF AMERICA Civil Action No.______________ Petitioner, V. Robert Charles Freeman Respondent.___________________________________________________________________________________________
RETURN TO ORDER TO SHOW CAUSE
___________________________________________________________________________________________
Respondent, Robert Charles Freeman, hereby files his Return to Order to Show Cause which is dated August 9th, 2006 by the Honorable Walker D. Miller and served on Respondent on July 12th, 2006 based upon the following reasons:
1. The Order to Show Cause should not be allowed based upon Respondent’s rights under the Fifth Amendment to the United States Constitution supporting Respondent’s protection against self-incrimination. The following cases clearly support this protection:
a. The protection of the Fifth Amendment against self- incrimination, as succinctly explained by Mr. Justice Brandeis has not been restricted in later decisions. It is equally clear that this protection applies in the instant proceeding. Moreover, in Kastigar vs. United states, 406
It can be asserted in any proceeding, civil or criminal, administrative or judicial, investigatory or adjudicatory; and it protects against any disclosures that the witness reasonably believes could be used in a criminal prosecution or could lead to other evidence that might be so used.
b. Valid Fear of Incrimination Protects Refusal to Produce Records and Testimony to Internal Revenue Service
A witness, summoned by the Commissioner of Internal Revenue was held justified in refusing to answer questions put to him by a revenue agent because of the danger of self-incrimination In re Friedman, 104 F. Supp. 419, 41 AFTR 1266 (D.C. N.Y. 1952). In the Friedman case the Court stated its position as follows: The applicable law was recently restated in Hoffman vs. United States, 341
c. In numerous cases where the Internal Revenue Service has sought court enforcement of its summons pursuant to statute (26 U.S.C. Sec. 7402), Courts have held that a taxpayer may refuse production of personal books and records by assertion of his privilege against self-incrimination.See, e.g., Stuart v. United States, 416 F.2d 459 (5th Cir. 1969); United States v. Cohen, 388 F.2d 464 (9th Cir. 1967);
d. Further, based on just the few cases aforementioned, Respondent should not be required to show records.
3. Respondent attended a summons meeting on June 12, 2006 and was there to comply. IRS agent, William Sothen asked questions for approximately two hours and the Respondent answered every question asked. Respondent legally and properly answered ever question that would be self-incriminating with the Fifth Amendment objection. Respondent also asked a few questions to Mr. Sothen including:
Mr. Sothen : “Ymm. This is a civil proceeding of the IRS, it is not a criminal proceeding. The purpose of this proceeding in to determine your substantially correct tax liability. It is simply one part of the examination with regard to determining you substantially correct tax liability.”
Respondent - “I don’t believe you answered my question.”
Mr. Sothen - “I don’t believe I know the answer.”
Respondent - “Okay”.
Mr. Sothen - “In other words, I don’t, I don’t, uh I don’t I am not a, I’m a civil investigator, I’m not a criminal investigator. We are not in a criminal venue here.”
b. Does the IRM state that I can take the 5th Amendment objection?
Mr. Sothen - “I don’t think I have ever seen that in the IRM, but that is contained apparently in the Supreme Court.”
Respondent - “Do you think you can get me an answer on that?”
Sothen - “I think I am going to let you find your own answer.”
c. Can the IRS grant me immunity for the questions I answer?
Mr. Sothen - “I have already told you what your 5th amendment privileges are. That’s the only thing that I am aware of that you are entitled to. “
Respondent -”Can you grant me immunity though?”
Mr. Sothen - “Grant you immunity?”
Respondent - “From my testimony?”
Mr. Sothen - “Um I don’t know what you mean so I am not going to attempt to answer the question.”
Respondent - “Alright.”
d. Can the IRS recommend to the DOJ immunity for my answers?
Mr. Sothen - “I have no idea.”
e. Can I take the objection of the 5th Amendment to the Supreme Court?
Mr. Sothen - “I have no idea.”
From this line of questioning it is obvious that either Mr. Sothen doesn’t know the extent of this case or he is not telling the truth on whether the line of questions he is about to ask will be used against the Respondent in a criminal way. If the IRS is not considering a criminal investigation then why can’t Mr. Sothen answer these questions? Information gained by the IRS knowing that this information could be used against the Respondent in a criminal manner is against the Supreme Courts ruling in the LaSalle case. (US vs. LaSalle Nat. Bank, 98 S.Ct. 2357 (1978)). See Exhibit #1 for the entire cite of United States v. LaSalle National Bank:
4. Even if Respondent was required to produce books and records, most of those records should be already in the hands of the IRS. Part of the records were in the possession of Innovative Financial Consultants (IFC) and the IRS has obtained those records under a search warrant in conjunction with investigative/examination efforts performed on IFC.
Respondent received information from a representative of IFC that previous charges made by the IRS have been dropped. Therefore, any examination efforts by the IRS on Respondent should be dropped as well.
5. The IRS issued a summons on and received the records from Respondent’s bank and Respondent should not be required to give records the IRS already has obtained. It is not necessary that IRS receive two copies of the same records. These bank records should provide a thorough and complete accounting of Respondent’s financial activities for the proposed purposes disclosed by the IRS.
6. Respondent denies certain statements/allegations contained within the Petition to Enforce Internal Revenue Service Summons as follows:
a. Respondent does admit that the Internal Revenue Service (hereinafter, “ IRS”) did in fact issue and serve an Internal Revenue Service Summons on Respondent.
b. Respondent denies having any tax liabilities for the years ending December 31, 2000, December 31, 2001, December 31, 2002 and December 31, 2003. It becomes blatantly obvious the IRS, in this Case, is clearly wasting valuable time and expense of the Court, Department of the Treasury, Department of Justice, the Internal Revenue Service and Respondent in their continued efforts regarding these matters.
c. Respondent admits he did not appear on April 18, 2005 in response to the Summons.
Petitioner, on the other hand, failed to disclose the fact that a letter was sent to Mr. Sothen dated on April 15, 2005 stating the reasons why he would not be attending the summons. A 2039 is not enforceable until federal court order has backed it. In the recent
“IRS summonses apply no force to taxpayers, and no consequence whatever can befall a taxpayer who refuses, ignores, or otherwise does not comply with an IRS summons until that summons is backed by a federal court order.” (Schulz v. IRS, 04-0196) (Emphasis added)
As soon as this court ordered the Respondent to attend the IRS summons, the Respondent respectfully did everything that Honorable Judge Walker Miller asked of him. In no way has the Respondent disobeyed or been disrespectful to this court.
e. Respondent denies all administrative steps required by the Internal Revenue Code for the issuance of a summons have been taken as stated in the
f. Respondent denies the books. papers, records and other data sought by the summons are not already in the possession of the Internal Revenue Service.
7. And other grounds as permitted by law and as will be hereinafter submitted to this court.
CONCLUSION
For the reasons set forth above, Respondent respectfully requests the Court to accept Respondent’s Motion to Dismiss United States Fed. R. Civ. 60(b)(3) Motion for Relief From Order, Request for Order To Show Cause, and Motion For Sanctions For Contempt of Court Order filed July 18th, 2006 as a timely filing and take into full consideration all of the issues stated within for a full and fair determination by the Court.
Respondent’s sincere and just attempts to comply with a prior summons meeting should be honored. Court is requested to cancel the date set for August 9th , 2006 Ordering Respondent to Show Cause.
CERTIFICATE OF SERVICE: I do hereby certify that on this date I sent properly a copy of this pleading to opposing council, postage prepaid, and addressed to: