24-924-cv United States v. Colasuonno
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
SUMMARY ORDER RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 13th day of May, two thousand twenty-five.
PRESENT: REENA RAGGI, SUSAN L. CARNEY, ALISON J. NATHAN, Circuit Judges. _____________________________________
United States of America,
Plaintiff-Counter- Defendant-Appellee,
v. 24-924-cv
Philip Colasuonno,
1 Defendant-Counter- Claimant-Appellant. * _____________________________________
FOR PLAINTIFF-APPELLEE: Matthew Podolsky, Acting U.S. Atty. S.D.N.Y., Jeremy M. Liss, Christopher Connolly, Asst. U.S. Attys., Of Counsel.
FOR DEFENDANT-APPELLANT: Erin K. Flynn, Clair Gjertsen & Weathers PLLC, White Plains, NY.
Appeal from a judgment of the United States District Court for the Southern
District of New York (McCarthy, Magistrate Judge).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,
ADJUDGED, AND DECREED that the judgment of the district court is
AFFIRMED.
Defendant-Appellant Philip Colasuonno appeals from the denial of his
motion for judgment on the pleadings and the grant of summary judgment in
favor of Plaintiff-Appellee the United States. We assume the parties’ familiarity
with the underlying facts, procedural history, and issues on appeal, to which we
refer only as necessary to explain our decision to affirm the judgment of the district
* The Clerk of Court is respectfully directed to amend the caption as noted. 2 court.
Colasuonno was the partial owner of a company that failed to collect,
truthfully account for, and remit Social Security, Medicare, unemployment, and
income taxes from its employees’ wages and to report these holdings to the
Internal Revenue Service (IRS), as required by federal law. He subsequently pled
guilty to conspiracy to commit tax fraud, in violation of 18 U.S.C. § 371, and aiding
and assisting in the preparation of a false tax return, in violation of 26 U.S.C. §
7206(2).
Colasuonno then filed a petition for Chapter 7 bankruptcy in the U.S.
Bankruptcy Court for the Southern District of New York. On April 21, 2011, while
the bankruptcy proceedings were pending, the IRS timely assessed $1,742,410.30
in trust fund recovery penalties against Colasuonno for the relevant tax period.
Shortly thereafter, the IRS issued a Notice of Federal Tax Lien to Colasuonno,
which it filed with the Westchester County Clerk. On July 22, 2011, the bankruptcy
court granted Colasuonno a discharge.
The United States commenced this action against Colasuonno in December
2021 to recover the assessed trust fund recovery penalties and interest.
Colasuonno moved for judgment on the pleadings, contending that the complaint
3 was untimely. The district court denied Colasuonno’s motion, holding that the
complaint was timely filed under the applicable tolling provision and rejecting
Colasuonno’s argument that the IRS’s alleged violation of the bankruptcy stay by
filing the Notice of Federal Tax Lein meant that the tolling provision did not apply.
The district court later granted the government’s motion for summary judgment.
Colasuonno timely appealed.
On appeal, Colasuonno challenges only the district court’s denial of his
motion for judgment on the pleadings, arguing that the government’s filing of the
Notice of Federal Tax Lien during the pendency of his bankruptcy proceeding
forecloses the applicability of the relevant tolling statute.
I. Standard of Review
This Court reviews de novo a district court’s denial of a motion for judgment
on the pleadings, “accepting the allegations in the amended complaint as true and
drawing all reasonable inferences in favor of the nonmoving party.” Ass'n of Car
Wash Owners Inc. v. City of New York, 911 F.3d 74, 80 (2d Cir. 2018) (quotation marks
omitted). “In deciding a Rule 12(c) motion, we employ the same standard
applicable to dismissals pursuant to Rule 12(b)(6).” L-7 Designs, Inc. v. Old Navy,
LLC, 647 F.3d 419, 429 (2d Cir. 2011) (quotation marks omitted and alterations
4 adopted).
II. Discussion
Colasuonno’s only argument on appeal is that the district court should have
granted his motion for judgment on the pleadings on the ground that the
government’s complaint was untimely. Typically, an action for collection of a
penalty assessment must be filed “within 10 years after the assessment of the
[penalty].” 26 U.S.C. § 6502(a)(1); see also id. at § 6671(a). Because the IRS filed the
assessment on April 21, 2011, the statute of limitations ordinarily would have run
by April 21, 2021, before the government filed the present complaint in December
of that same year.
However, when a taxpayer has filed for bankruptcy, an automatic stay
prohibits collecting, assessing, or recovering a claim against him that arose before
the commencement of the bankruptcy case until the bankruptcy is closed or
dismissed or until a charge is granted or denied. 11 U.S.C. § 362(a); id. at § 362(c).
In other words, although the government could still make an assessment against
an individual while his bankruptcy proceeding is pending, see id. at § 362(b)(9)(D),
it cannot take any action to recover on that assessment until after the stay is lifted.
The Internal Revenue Code consequently tolls the statute of limitations for
5 collection of an assessment “for the period during which the Secretary is
prohibited by reason of [a case under title 11 of the United States Code] from
making the assessment or from collecting and . . . for collection, 6 months
thereafter.” 26 U.S.C. § 6503(h)(2). Thus, because the bankruptcy court granted
Colasuonno a discharge on July 22, 2011, the government had until January 22,
2022—ten years and six months from such discharge—to file its complaint. Under
§ 6503(h)(2), the complaint was therefore timely.
Before the district court and on appeal, Colasuonno contends that the tolling
provision does not apply because, in his view, the government violated the
automatic stay by filing a Notice of Federal Tax Lien while the bankruptcy
proceeding was pending. The district court held that it “need not pass on the
question of whether the [Notice] violated the stay” because, even if it did, the
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24-924-cv United States v. Colasuonno
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
SUMMARY ORDER RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 13th day of May, two thousand twenty-five.
PRESENT: REENA RAGGI, SUSAN L. CARNEY, ALISON J. NATHAN, Circuit Judges. _____________________________________
United States of America,
Plaintiff-Counter- Defendant-Appellee,
v. 24-924-cv
Philip Colasuonno,
1 Defendant-Counter- Claimant-Appellant. * _____________________________________
FOR PLAINTIFF-APPELLEE: Matthew Podolsky, Acting U.S. Atty. S.D.N.Y., Jeremy M. Liss, Christopher Connolly, Asst. U.S. Attys., Of Counsel.
FOR DEFENDANT-APPELLANT: Erin K. Flynn, Clair Gjertsen & Weathers PLLC, White Plains, NY.
Appeal from a judgment of the United States District Court for the Southern
District of New York (McCarthy, Magistrate Judge).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,
ADJUDGED, AND DECREED that the judgment of the district court is
AFFIRMED.
Defendant-Appellant Philip Colasuonno appeals from the denial of his
motion for judgment on the pleadings and the grant of summary judgment in
favor of Plaintiff-Appellee the United States. We assume the parties’ familiarity
with the underlying facts, procedural history, and issues on appeal, to which we
refer only as necessary to explain our decision to affirm the judgment of the district
* The Clerk of Court is respectfully directed to amend the caption as noted. 2 court.
Colasuonno was the partial owner of a company that failed to collect,
truthfully account for, and remit Social Security, Medicare, unemployment, and
income taxes from its employees’ wages and to report these holdings to the
Internal Revenue Service (IRS), as required by federal law. He subsequently pled
guilty to conspiracy to commit tax fraud, in violation of 18 U.S.C. § 371, and aiding
and assisting in the preparation of a false tax return, in violation of 26 U.S.C. §
7206(2).
Colasuonno then filed a petition for Chapter 7 bankruptcy in the U.S.
Bankruptcy Court for the Southern District of New York. On April 21, 2011, while
the bankruptcy proceedings were pending, the IRS timely assessed $1,742,410.30
in trust fund recovery penalties against Colasuonno for the relevant tax period.
Shortly thereafter, the IRS issued a Notice of Federal Tax Lien to Colasuonno,
which it filed with the Westchester County Clerk. On July 22, 2011, the bankruptcy
court granted Colasuonno a discharge.
The United States commenced this action against Colasuonno in December
2021 to recover the assessed trust fund recovery penalties and interest.
Colasuonno moved for judgment on the pleadings, contending that the complaint
3 was untimely. The district court denied Colasuonno’s motion, holding that the
complaint was timely filed under the applicable tolling provision and rejecting
Colasuonno’s argument that the IRS’s alleged violation of the bankruptcy stay by
filing the Notice of Federal Tax Lein meant that the tolling provision did not apply.
The district court later granted the government’s motion for summary judgment.
Colasuonno timely appealed.
On appeal, Colasuonno challenges only the district court’s denial of his
motion for judgment on the pleadings, arguing that the government’s filing of the
Notice of Federal Tax Lien during the pendency of his bankruptcy proceeding
forecloses the applicability of the relevant tolling statute.
I. Standard of Review
This Court reviews de novo a district court’s denial of a motion for judgment
on the pleadings, “accepting the allegations in the amended complaint as true and
drawing all reasonable inferences in favor of the nonmoving party.” Ass'n of Car
Wash Owners Inc. v. City of New York, 911 F.3d 74, 80 (2d Cir. 2018) (quotation marks
omitted). “In deciding a Rule 12(c) motion, we employ the same standard
applicable to dismissals pursuant to Rule 12(b)(6).” L-7 Designs, Inc. v. Old Navy,
LLC, 647 F.3d 419, 429 (2d Cir. 2011) (quotation marks omitted and alterations
4 adopted).
II. Discussion
Colasuonno’s only argument on appeal is that the district court should have
granted his motion for judgment on the pleadings on the ground that the
government’s complaint was untimely. Typically, an action for collection of a
penalty assessment must be filed “within 10 years after the assessment of the
[penalty].” 26 U.S.C. § 6502(a)(1); see also id. at § 6671(a). Because the IRS filed the
assessment on April 21, 2011, the statute of limitations ordinarily would have run
by April 21, 2021, before the government filed the present complaint in December
of that same year.
However, when a taxpayer has filed for bankruptcy, an automatic stay
prohibits collecting, assessing, or recovering a claim against him that arose before
the commencement of the bankruptcy case until the bankruptcy is closed or
dismissed or until a charge is granted or denied. 11 U.S.C. § 362(a); id. at § 362(c).
In other words, although the government could still make an assessment against
an individual while his bankruptcy proceeding is pending, see id. at § 362(b)(9)(D),
it cannot take any action to recover on that assessment until after the stay is lifted.
The Internal Revenue Code consequently tolls the statute of limitations for
5 collection of an assessment “for the period during which the Secretary is
prohibited by reason of [a case under title 11 of the United States Code] from
making the assessment or from collecting and . . . for collection, 6 months
thereafter.” 26 U.S.C. § 6503(h)(2). Thus, because the bankruptcy court granted
Colasuonno a discharge on July 22, 2011, the government had until January 22,
2022—ten years and six months from such discharge—to file its complaint. Under
§ 6503(h)(2), the complaint was therefore timely.
Before the district court and on appeal, Colasuonno contends that the tolling
provision does not apply because, in his view, the government violated the
automatic stay by filing a Notice of Federal Tax Lien while the bankruptcy
proceeding was pending. The district court held that it “need not pass on the
question of whether the [Notice] violated the stay” because, even if it did, the
Internal Revenue Code provides that the exclusive remedy for violations of the
automatic stay is to petition the bankruptcy court to recover damages. United
States v. Colasuonno, 653 F. Supp. 3d 59, 66 (S.D.N.Y. 2023) (citing 26 U.S.C.
§ 7433(e)(1)). As a consequence, it concluded, Colasuonno’s claim of a violation
of the automatic stay should have been brought in the bankruptcy court in the first
instance, not raised as a defense to the applicability of the tolling provision. Id.
6 In his appellate brief, Colasuonno does not address the district court’s
holding that, regardless of whether the filing of the Notice violated the stay, such
a violation would not result in suspension of tolling because the exclusive remedy
would be seeking damages in bankruptcy court. “We consider abandoned any
claims not adequately presented in an appellant's brief, and an appellant's failure
to make legal or factual arguments constitutes abandonment.” Debique v. Garland,
58 F.4th 676, 684 (2d Cir. 2023) (quotation marks omitted), cert. denied, 144 S. Ct.
2715 (2024).
Colasuonno largely focuses on his assumption that filing the Notice violated
the stay. To the extent Colasuonno argues that a violation of the stay should
preclude applying the tolling provision on fairness grounds, he makes this
argument only “in a perfunctory manner, unaccompanied by some effort at
developed argumentation,” without citation to binding precedent, and without
addressing why any fairness interest would require disturbing the district court’s
holding that controlling statutory language requires stay violations to be redressed
in bankruptcy court. Tolbert v. Queens Coll., 242 F.3d 58, 75 (2d Cir. 2001) (quotation
marks omitted). Colasuonno did not raise a challenge to the district court’s
holding “or mentioned [it] only in passing; he thus failed to articulate any specific
7 reasons as to why the district court erred.” Tripathy v. McKoy, 103 F.4th 106, 118
(2d Cir. 2024).
Because he does not challenge the district court’s conclusion that the
debtor’s exclusive remedy for an alleged stay violation is to seek a damages award
against the United States in bankruptcy court, Colasuonno has abandoned any
challenge to the dispositive ground for the district court’s denial of his motion for
judgment on the pleadings. See Debique, 58 F.4th at 684. Although “we have
discretion to excuse such an error if manifest injustice would otherwise result,” no
such injustice would result here. JP Morgan Chase Bank v. Altos Hornos de Mexico,
S.A. de C.V., 412 F.3d 418, 428 (2d Cir. 2005). Colasuonno is “represented by
sophisticated counsel” and “had ample opportunity properly to pursue the
argument.” Motorola Credit Corp. v. Uzan, 509 F.3d 74, 88 (2d Cir. 2007). We
therefore decline to consider his arguments concerning the merits of his claim.
* * *
Accordingly, we AFFIRM the judgment of the district court. The
government’s motion to dismiss is DENIED as moot.
FOR THE COURT: Catherine O’Hagan Wolfe, Clerk of Court