Found it.
Lochland D. Jeffries v. Continental Airlines, No. 07-1761 (PGS)(ES) (U.S.D.C. N.J.)
From the motion for sanctions, Docket #18:
Continental Airlines wrote:Defendant Continental Airlines, Inc. ("Continental") moves this Court for an order imposing sanctions, pursuant to Fed. R. Civ. P. 11, upon plaintiff Lochland D. Jeffries. Plaintiff deserves to be sanctioned because he pursued an utterly frivolous and baseless tax protest complaint despite Continental's informal and formal advice that his lawsuit was frivolous and its requests that he withdraw it.
Plaintiff's frivolous complaint in this case was the continuation of his nearly two-year quest to stop Continental from withholding income taxes from his paychecks. Continental fully recounted the history of plaintiff's quest in its motion to dismiss and, thus, only a brief summary of the factual background of the case is included here.
In September 2005 the IRS specifically directed
Continental to "[d]isregard the information on [plaintiff's] Form W-4", to withhold taxes with plaintiff classified as single and with zero allowances, and to disregard any future W-4 from plaintiff if it claimed exempt status. (MTD Br. at 1.) In its letter to Continental, the IRS explained that the Internal Revenue Code, Section 3402 "requires employers to withhold tax" and that Section 3403 "states that your employees do not have a 'cause of action' (basis for legal action) to recover wages you withheld by law." (Id.) Plaintiff knew about Continental's obligations with respect to his withholdings and Form W-4s, as the IRS sent him a simultaneous and similar letter. (Id. at 2.)
Despite written notice from the IRS of the IRS's directives to Continental, plaintiff wrote to Continental's Human Resources Department to disparage the IRS and accused it of attempting to threaten Continental into withholding taxes. (Id.)
Nearly a year later, plaintiff continued his baseless attempts to exempt himself from income tax withholding. In May 2006 he sent several dubious tax forms to Continental's payroll department. A month later, plaintiff sent another letter and attached another dubious form. By this time, the focus of plaintiff's ire had shifted from the IRS to Continental, and he threatened to sue. (Id.) Defendant Margaret Coullard Phillips ("Phillips"), a Senior Attorney at Continental, promptly answered plaintiff's letter indicating that his requests to cease withholdings were "respectfully declined," enclosing an IRS publication entitled "The Truth About Frivolous Tax Arguments", and stating that she considered the matter closed. (Id.)
Despite that he had known for over a year that the IRS specifically directed Continental to continue to withhold taxes from his paychecks, and despite Phillips' letter and her forwarding of the IRS publication, plaintiff persisted, and his efforts crossed over into harassment. Plaintiff enlisted the "Mid-Atlantic Trustees and Administrators" and its president, Ronald Ottaviano, to continue his protests. (Id. at 2-3.) Mr. Ottaviano's letter lectured Phillips on his beliefs about tax law and "supported" his arguments with dubious legal authority. Mr. Ottaviano also threatened Phillips with a malpractice lawsuit and threatened Continental with a civil claim. (Id. at 3.) Mr. Ottaviano, plaintiff's agent, continued to harass defendants with another insulting letter a month later, which varied its insults but repeated the same frivolous legal positions. (Id.)
Mr. Ottaviano's letters did not dignify a reply from defendants. Nevertheless, out of an abundance of courtesy and in effort to finally put plaintiff's frivolous tax protests to rest, Phillips wrote to Mr. Ottaviano to affirm Continental's position and to reiterate that Continental considered the matter closed. (Id.)
Plaintiff did not stop. He continued to insult Phillips in a January 2007 letter in which he accused her of "weak-kneed fear of the IRS". Phillips replied to plaintiff's latest letter and, again, affirmed Continental's obligation to withhold taxes from his paychecks. (Id.)
Having been repeatedly told that his tax arguments were baseless, having known for more than a year that the IRS ordered Continental to continue to withhold taxes and ignore his claims of exemption, and having received respectful replies from defendants despite the frivolity of his correspondence, plaintiff sued defendants.
The crux of plaintiff's complaint was that Continental somehow wronged him by continuing to withhold income taxes from his paychecks after he filed a Form W-4 claiming he had no tax liability. (See Compl. ¶¶ 1, 3-5.) Plaintiff also claimed either or both defendants committed mail fraud when Phillips replied to his harassing letters and explained that his arguments were misguided.
After removing plaintiff's complaint to this Court on April 16, 2007, Continental informally advised plaintiff, by letter dated May 8, 2007, that his complaint was frivolous and that it intended to seek sanctions if he did not withdraw it. (See Bruno R. 11 Decl. Ex. A.)
Continental filed its motion to dismiss on May 31. Continental provided plaintiff with formal notice of its intent to seek sanctions by serving the motion papers upon him on June 12, 2007 -- at least 21 days before filing this motion -- which gave him an additional opportunity to withdraw his complaint and avoid sanctions. (Id. ¶ 4.) Instead of heeding Continental's advice, plaintiff moved, with no basis whatsoever, to remand his complaint to state court.
By order dated June 20, 2007, Judge Sheridan converted Continental's motion to dismiss into one for summary judgment. During the first scheduled hearing on that motion, plaintiff requested an adjournment due to his desire to retain counsel, which Judge Sheridan granted. (Avery Decl. ¶ 3.) Ronald McCray subsequently attempted to appear on behalf of plaintiff but Judge Sheridan directed Mr. McCray, after defendants' objection, not to participate because he is not licensed to practice law in this Court. (Id. ¶ 4.) Judge Sheridan heard argument on the summary judgment motion on July 19, 2007, during which defendant Phillips joined in Continental's motion. (Id. ¶ 5.) Judge Sheridan granted the motion and read an opinion into the record. (Id. ¶ 6.) His opinion cited ample clear-cut authority under which claims like plaintiff's have repeatedly been rejected. (Id. ¶ 7.) Judge Sheridan memorialized his decision in a July 20 order dismissing all of plaintiff's claims against defendants. (Id. ¶ 8.) As the Court is aware,
plaintiff thereafter moved for reconsideration of Judge Sheridan's decision, which motion was
also denied.
The court should sanction plaintiff for pursuing utterly frivolous claims and for forcing defendants to defend his harassing litigation. Continental requests that plaintiff be ordered to pay its legal fees and costs incurred in defending this action.
