2a Houston Division Record

Case 4:14-cv-00027 Document 1 Filed in TXSD on 01/07/14 Page 1 of 5
IN THE UNITED STATES DISTRICT COURT FOR THE

SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
UNITED STATES OF AMERICA,
Plaintiff,
v.
JOHN PARKS TROWBRIDGE, JR.,
FREEDOM VENTURES, UBO, and
MONTGOMERY COUNTY TAX OFFICE,
Defendants.
CIVIL NO. 4:14-cv-0027
COMPLAINT
Plaintiff, United States of America, pursuant to 26 U.S.C. ' 7401, 7402, and 7403, at the
direction of the Attorney General of the United States, or his delegate, and at the request of the
Secretary of the Treasury, or his delegate, brings this action to reduce to judgment federal
income tax assessments against defendant, John Parks Trowbridge, Jr., and foreclose tax liens
associated with the assessments against real property known as 25117 Ramrock Drive, Porter,
Texas 77365.
JURISDICTION AND VENUE
1.
This Court has jurisdiction over this action pursuant to 26 U.S.C. ' 7402 and 7403and 28
U.S.C. '' 1340, and 1345.

2.
Venue is proper pursuant to 28 U.S.C. '' 124(b) and 1396.

PARTIES
3.
Plaintiff is the United States of America.
4.
Defendant, John Parks Trowbridge, Jr., resides within the jurisdiction of this Court.
14-20333.8
5.
Defendant, Freedom Ventures, UBO, has been named as a party to this action, as required
by 26 U.S.C. 7403(b), because it has or may claim an interest in the property upon which the
United States seeks to foreclose its lien.
6.
Defendant, Montgomery County Tax Office, has been named as a party to this action, as
required by 26 U.S.C. 7403(b), because it has or may claim an interest in the property upon
which the United States seeks to foreclose its lien.
FACTS
7.
Defendant, John Parks Trowbridge, Jr. owes the United States the following amounts of
unpaid federal income taxes, penalties, and interest:
8.
Type of Tax
Tax Period
Assessment Date
1040
1040
1040
1040
1040
1993
1994
1995
1996
1997
1/20/2004
1/20/2004
1/20/2004
1/16/2004
1/16/2004
Amount Due Through

(September 1, 2013)
$371,173.71
$482,760.14
$481,310.16
$1,295,799.01
$655,292.45
TOTAL:
$3,286,335.47
Defendant, John Parks Trowbridge, Jr., was given notice and demand was made for
payment of the unpaid taxes on or about the assessment dates listed in paragraph 7.
9.
The United States recorded notices of its tax lien securing the above liabilities in the real
property records of Montgomery County, Texas, on or about October 2, 2012, and July 7, 2011,
for the tax periods listed in paragraph 7.1
COUNT I (Judgment for Outstanding Tax Liabilities)
10.
The United States incorporates the allegations set forth in paragraphs 7 through 9.
Copies of the Notices of Federal Tax Lien are attached as Government Ex. A.
U.S. Complaint
Page 2 of 5
14-20333.9
11.
As of September 1, 2013, defendant, John Parks Trowbridge, Jr., owes the United States
$3,286,335.47 for federal income taxes, penalties, and interest accrued for the tax periods
referenced in paragraph 7. Defendant, John Parks Trowbridge, Jr., further owes all interest and
statutory additions that accrue from September 1, 2013, until his tax liabilities are paid.
COUNT II (Foreclosure of Tax Liens)
12.
The United States incorporates the allegations set forth in paragraphs 7 through 11.
13.
On April 25, 2005, David Powers Homes S.T. LTD transferred by warranty deed the real
property located at 25117 Ramrock Drive, Porter, Texas (Porter property) to defendant, John
Parks Trowbridge, Jr.,, said property being more specifically described as follows:
Lot Sixteen (16), Block One (1), of Bentwood, Section One (1), a
Subdivision of 156.8 Acres of Land, Out of the William Massey
Survey, A-391, and the Mary Owens Survey, A-405, in
Montgomery County, Texas, as Imposed by the Map and
Dedication Records in Cabinet G, Sheets 138A through 141A of
the Map Records of Montgomery County, Texas.
14.
On or about May 2, 2005, the warranty deed was recorded, on that same date, a deed of
trust in the amount of $299,768 with DPH Mortgage, Ltd., was recorded.
15.
On or about October 25, 2012, Real Property Bill of Exchange Contract and Agreement
between defendants, John Parks Trowbridge, Jr. and Freedom Ventures, UBO, was filed with the
Montgomery County Clerks Office. The contract purported to transfer the Porter Property from
defendant, John Parks Trowbridge, Jr., to defendant, Freedom Ventures, UBO, for the sum of
$1,000.00.
16.
The transfer described in paragraph 15 was intended to hinder and delay the collection
efforts of the Internal Revenue Service and to defraud plaintiff, United States of America, and
should be set aside as void with respect to the United States.
U.S. Complaint
Page 3 of 5
14-20333.10
17.
Plaintiff, United States of America, has a valid and subsisting federal tax liens on all
property and rights to property belonging to the defendant, John Parks Trowbridge, Jr., including
his interest in the Porter Property.
18.
The federal tax liens against the defendant, John Parks Trowbridge, Jr., should be
foreclosed upon the Porter property, the Porter property should be sold free and clear of all
rights, titles, claims, and interests of the parties, and the proceeds of the sale should be
distributed according to law.
PRAYER
WHEREFORE, plaintiff, United States of America, respectfully requests that the Court order the
following:
A.
As of September 1, 2013, defendant, John Parks Trowbridge, Jr., owes the United States
$3,286,335.47 for federal income taxes, penalties, and interest accrued for the tax periods
referenced in paragraph 7. Defendant, John Parks Trowbridge, Jr., further owes all
interest and statutory additions that accrue from September 1, 2013, until his tax
liabilities are paid.
B.
That the United States has a perfected lien interest in all property and rights to property
belonging to defendant, John Parks Trowbridge, Jr., as of the assessment date, or
acquired thereafter.
C.
That the federal tax liens against the defendant, John Parks Trowbridge, Jr., be foreclosed
upon the Porter Property, the Porter Property should be sold free and clear of all rights,
titles, claims, and interests of the parties, and the proceeds of the sale should be
distributed according to law.
U.S. Complaint
Page 4 of 5
14-20333.11
DATE: January 7, 2014
KENNETH MAGIDSON
United States Attorney
/s/ Joshua D. Smeltzer
JOSHUA D. SMELTZER
Attorney-in-Charge
State Bar (Maryland)
Trial Attorney, Tax Division
U.S. Department of Justice
717 N. Harwood, Suite 400
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (Fax)
Joshua.D.Smeltzer@usdoj.gov
ATTORNEY FOR THE UNITED STATES
U.S. Complaint
Page 5 of 5
14-20333.12
Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 1 of 8
Government
Exhibit
A
_____________
14-20333.13
14-20333.14
14-20333.15
14-20333.16
14-20333.17
14-20333.18
14-20333.19
14-20333.20
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John Parks Trowbridge, Jr., Freedom Ventures, UBO, and

Montgomery County Tax Office
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14-20333.22

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES CERTIFICATE OF INTERESTED PARTIES

Plaintiff, United States of America, certifies to the Court that the following are, or may
be, financially interested in the outcome of this litigation:
1.
UNITED STATES OF AMERICA, through its agency the INTERNAL
REVENUE SERVICE.
2.
JOHN PARKS TROWBRIDGE, JR.
3.
FREEDOM VENTURES, UBO.
4.
MONTGOMERY COUNTY TAX OFFICE.
14-20333.23
KENNETH MAGIDSON
/s/ Joshua Smeltzer

JOSHUA SMELTER
Attorney-in-charge
Department of Justice, Tax Division
Maryland Bar (no bar #)
Admitted pursuant to 28 U.S.C. 517
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)
U.S. Certificate of Interested Parties

Page 2 of 2
14-20333.24

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES CERTIFICATE OF INTERESTED PARTIES

Plaintiff, United States of America, certifies to the Court that the following are, or may
be, financially interested in the outcome of this litigation:
1.
UNITED STATES OF AMERICA, through its agency the INTERNAL
REVENUE SERVICE.
2.
3.
FREEDOM VENTURES, UBO.
4.
MONTGOMERY COUNTY TAX OFFICE.
14-20333.25
KENNETH MAGIDSON
/s/ Joshua Smeltzer

JOSHUA SMELTER
Attorney-in-charge
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)
U.S. Certificate of Interested Parties

Page 2 of 2
14-20333.26

AO 440 (Rev. 06/12) Summons in a Civil Action
UNITED STATES DISTRICT COURT

for the
SouthernDistrict
Districtofof__________
Texas
__________
Plaintiff(s)
v.
John Parks Trowbridge, Jr., et al.
Defendant(s)
)
)
)
)
)
)
)
)
)
)
)
)
Civil Action No. 4:14-cv-0027
SUMMONS IN A CIVIL ACTION

To: (Defendants name and address) John Parks Trowbridge, Jr.
25117 Ramrock Drive
Porter, Texas 77365
A lawsuit has been filed against you.

Within 21 days after service of this summons on you (not counting the day you received it) or 60 days if you
are the United States or a United States agency, or an officer or employee of the United States described in Fed. R. Civ.
P. 12 (a)(2) or (3) you must serve on the plaintiff an answer to the attached complaint or a motion under Rule 12 of
the Federal Rules of Civil Procedure. The answer or motion must be served on the plaintiff or plaintiffs attorney,
whose name and address are: Joshua D. Smeltzer
Dallas, Texas 75201
If you fail to respond, judgment by default will be entered against you for the relief demanded in the complaint.
You also must file your answer or motion with the court.
CLERK OF COURT
Date:
Signature of Clerk or Deputy Clerk
14-20333.27

AO 440 (Rev. 06/12) Summons in a Civil Action (Page 2)

PROOF OF SERVICE
(This section should not be filed with the court unless required by Fed. R. Civ. P. 4 (l))
This summons for (name of individual and title, if any)
was received by me on (date)
u I personally served the summons on the individual at (place)

on (date)
; or
u I left the summons at the individuals residence or usual place of abode with (name)
, a person of suitable age and discretion who resides there,
on (date)
, and mailed a copy to the individuals last known address; or
u I served the summons on (name of individual)
, who is
designated by law to accept service of process on behalf of (name of organization)

on (date)
; or
u I returned the summons unexecuted because
; or
u Other (specify):
.
My fees are $
for travel and $
for services, for a total of $
0.00
I declare under penalty of perjury that this information is true.
Date:
Servers signature
Printed name and title
Servers address
Additional information regarding attempted service, etc:
14-20333.28


for the
SouthernDistrict
Texas
__________
Plaintiff(s)
v.
Defendant(s)
)
)
)
)
)
)
)
)
)
)
)
)

To: (Defendants name and address) Freedom Ventures, UBO
c/o John Parks Trowbridge, Jr., Trustee
25117 Ramrock Drive
Porter, Texas 77365

Dallas, Texas 75201
CLERK OF COURT
Date:
14-20333.29


PROOF OF SERVICE

on (date)
; or
on (date)
, who is

on (date)
; or
; or
u Other (specify):
.
My fees are $
for travel and $
0.00
Date:
Servers signature
Servers address
14-20333.30


for the
SouthernDistrict
Texas
__________
Plaintiff(s)
v.
John Parks Trowbridge, Jr. et al
Defendant(s)
)
)
)
)
)
)
)
)
)
)
)
)

To: (Defendants name and address) Montgomery County Tax Office
400 North San Jacinto
Conroe, Texas 77301

Dallas, Texas 75201
CLERK OF COURT
Date:
14-20333.31


PROOF OF SERVICE

on (date)
; or
on (date)
, who is

on (date)
; or
; or
u Other (specify):
.
My fees are $
for travel and $
0.00
Date:
Servers signature
Servers address
14-20333.32
United States Of America

versus
Civil Action 4:14cv00027
Order for Conference

1.
The plaintiff must accomplish service within 60 days.
2.
Counsel must appear for an initial pretrial conference on:

April 7, 2014, at 09:30 AM
before Judge Lynn N. Hughes
at 515 Rusk Avenue, Room 11122
Houston, Texas.
3.
Initial disclosures may not be delayed. Documents and other disclosures must
be exchanged, reviewed, and discussed with opposing counsel well before the
conference.
4.
No interrogatories, requests for admission, or depositions may be done

without court approval.
5.
A joint discovery plan is not required. Counsel must (a) master the facts, (b)
ascertain the discovery needed, (c) discuss it with each other, and (d) be
prepared to discuss discovery in a conference so that the court may fashion a
brief, effective management plan.
6.
The court will schedule additional preparation and may rule on motions
pending or made at the conference.
7.
To ensure full notice, each party who receives this notice must confirm that
every party knows of the setting.
8.
Failure to comply with this order may result in sanctions, including dismissal,
and prolonged tirades by the court.
Lynn N. Hughes
United States District Judge
14-20333.33
Judge Lynn N. Hughes

Courtroom 11C, Eleventh Floor
United States Court House
515 Rusk Avenue, Room 11122
Houston, Texas 770022605
(713) 2505900
Glenda Hassan, Case Manager

United States District Clerk
Post Office Box 61010
Houston,Texas 772081010
(713) 2505516
Glenda_Hassan@txs.uscourts.gov
Procedures. Suggestions for practice before Judge Hughes may be found at

www.txs.uscourts.gov. Please read them.
Contact. Make caserelated telephone inquiries to the case manager only. Counsel should
alert the case manager to matters requiring prompt attention.
Information. Get information about filings, orders, or docket entries from the computer or
from the clerk's office at (713) 2505500 or (800) 7454459.
Letters. Do not write letters. Put your message in a document with the case style.
Emergencies. Apply for immediate relief through the Intake Section of the Clerk's Office,
515 Rusk Avenue, Houston; (713) 2505500.
Counsel should send a copy of emergency motions directly to the case manager so that they
quickly reach the court's attention. In case of an emergency when the case manager cannot
be reached, please call the judge's secretary, Kathy Grant, at (713) 2505900.
Continuances. Joint motions for continuance do not bind the court. The court will respect
counsel's vacations.
Discovery Problems. The court will hear oral motions that affect discovery or scheduling as
soon as both counsel can appear in person or by telephone.
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14-20333.40
IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
Plaintiff
VS.
JOHN PARKS TRWOBRIDGE, JR.,

MONTGOMERY COUNTY TAX
OFFICE,
Defendant
CERTIFICATE OF INTERESTED PERSONS

I, Lori Gruver, counsel for Montgomery County Tax Office, who collects for itself and
the following taxing jurisdictions, Montgomery County Hospital District, New Caney
Independent School District, Montgomery County Emergency Services District No. 6, and Lone
Star College, do hereby certify, that other than the Plaintiff and the named known Defendant(s),
Montgomery County Municipal Utilities District 83 may have a financial interest in the outcome
of this case.
Respectfully Submitted,
14-20333.41
LORI GRUVER
ATTORNEY FOR TAXING AUTHORITIES
By:
/s/ Lori Gruver____________________

LORI GRUVER
State Bar No. 24007283
Southern Admission No. 22963
LINEBARGER GOGGAN
BLAIR & SAMPSON, LLP
P.O. Box 17428
Austin, Texas 78760
(512) 447-6675 (Telephone)
(512) 693-0728 (Facsimile)
CERTIFICATE OF SERVICE
I hereby certify that a true and correct copy of the foregoing has been filed electronically
and is to be served by electronic transmission to all parties on the courts electronic mailing
matrix on February 4, 2013.
/s/ Lori Gruver_____________________
LORI GRUVER
14-20333.42

HOUSTON DIVISION
Plaintiff
VS.

OFFICE,
Defendant
ORIGINAL ANSWER OF MONTGOMERY COUNTY TAX OFFICE

TO THE HONORABLE JUDGE OF SAID COURT:
NOW COMES, Montgomery County Tax Office (Taxing Authorities), and files its
Original Answer to United States of Americas Complaint (Complaint) and would respectfully
show the Court the following:
1. Taxing Authorities admit the Court has jurisdiction over this matter as alleged in
paragraph 1 of the Complaint.
2. Taxing Authorities admit the allegations in paragraph 2 of the Complaint.
4. Taxing Authorities are without the requisite knowledge to admit or deny the allegations in
paragraph 4 of the complaint, therefore they are denied.
14-20333.43
COUNT 1 (Judgment for Outstanding Tax Liabilities)
paragraph 7 and 8, as set forth by the United States and incorporated into paragraph 10, of the
complaint, therefore they are denied. Taxing Authorities admit the allegations in paragraph 9, as
set forth by the United States and incorporated into paragraph 10 of the Complaint.
COUNT II (Foreclosure of Tax Liens)
paragraphs 7 and 8, as set forth by the United States and incorporated into paragraph 12, of the
complaint, therefore they are denied. Taxing Authorities admit the allegations in paragraph 9, as
set forth by the United States and incorporated into paragraph 12 of the Complaint. Taxing
Authorities are not required to admit or deny the allegations in paragraph 11, as set forth by the
United States and incorporated into paragraph 12 of the Complaint and therefore is denied.
14-20333.44
paragraph 15 of the Complaint, therefore they are denied.
16. Taxing Authorities are without the requisite knowledge to admit or deny the allegations
in paragraph 16 of the Complaint, therefore they are denied.
18. Taxing Authorities deny the allegations in paragraph 18 of the Complaint.
WHEREFORE, PREMISES CONSIDERED, Taxing Authorities pray that the Court
a. recognize the continued existence of and validity of the tax liens securing payment
of the taxes, penalties and interest assessed by Taxing Authorities on the subject
property;
b. order that taxes, penalties and interest owing to the Taxing Authorities be paid
from the proceeds of the sale after the expenses of preservation of the sale and
prior to distribution to any other claimant; and
c. for all further relief to which Taxing Authorities may be entitled.
Respectfully Submitted,
14-20333.45
LORI GRUVER
By:
/s/ Lori Gruver

__________________
LORI GRUVER
LINEBARGER GOGGAN
P.O. Box 17428
Austin, Texas 78760
(512) 447-6675 (Telephone)
(512) 693-0728 (Facsimile)
I hereby certify that a true and correct copy of the foregoing has been filed electronically
and is to be served by electronic transmission to all parties on the courts electronic mailing
matrix on February 4, 2014
/s/ Lori Gruver_____________________
LORI GRUVER
14-20333.46
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14-20333.91

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES REQUEST FOR ENTRY OF DEFAULT

Plaintiff, United States of America, pursuant to Rule 55(b) of the Federal Rules of
Civil Procedure, requests that the Court enter a default against defendant, Freedom
Ventures, UBO, and in support of its request states as follows:
1.
The complaint initiating this action was filed on January 7, 2014. (Dkt.
#1.) Freedom Ventures, UBO, was named as a party that may claim an interest in the
property at issue. See 26 U.S.C. 7403(b).
2.
On January 15, 2014, the summons was served on John Parks Trowbridge,
Jr., as Trustee of Freedom Ventures, UBO. (Dkt. #6.)

3.
On February 13, 2014, John Parks Trowbridge, Jr., filed a purported
Conditional Acceptance and Demand for Proof or Withdrawal of Claims. (Dkt. #12.)
The Court has construed this as an answer by John Parks Trowbridge, Jr. individually.
(Dkt. #13.)
14-20333.92
4.
No filings have been made on behalf of Freedom Ventures, UBO. The
response filed by John Parks Trowbridge, Jr., is improper as a response by Freedom

Ventures, UBO because John Parks Trowbridge, Jr. is not an attorney1 and can represent
himself pro-se, but cannot represent an entity. See 28 U.S.C. 1654; Rowland v. California
Mens Colony, 506 U.S. 194, 202, 113 S.Ct. 716, 721 (1993) ([T]he lower courts have
uniformly held that 28 U.S.C. 1654 does not allow corporations, partnerships, or
associations to appear in federal court otherwise than through a licensed attorney.
[T]he rationale for that rule applies equally to all artificial entities.). To the extent Mr.
Trowbridge was attempting to respond for Freedom Ventures, UBO that pleading is
prohibited. Id.
5.
The time to file an answer or otherwise respond to the United States
complaint expired on February 5, 2014, and no response was filed by Freedom

Ventures, UBO claiming any interest in the property at issue. (Dkt. #6.) Therefore,
Freedom Ventures, UBO has failed to plead or otherwise defend any claim or interest it
may have in the property at issue as required by Federal Rules of Civil Procedure
12(a)(1)(A) and 12(b) and an entry of default judgment is appropriate.
WHEREFORE, Plaintiff, the United States of America, requests that the Court
enter default judgment against Defendant Freedom Ventures, UBO. The United States
also requests such further and other relief to which it may be justly entitled.
John Parks Trowbridge does not allege he is an attorney, nor does he list any State bar affiliation in his
response. (See Dkt. #12.) Counsel for the United States has searched for John Trowbridge on the
website for the Texas State Bar and did not find any listing under that name.
U.S. Motion Requesting Default
Page 2 of 4
1
14-20333.93
DATE:
March 12, 2014
KENNETH MAGIDSON
/s/ Joshua Smeltzer

JOSHUA SMELTER
Attorney-in-charge for defendant
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)

Page 3 of 4
14-20333.94
I certify that on March 12, 2014, the foregoing UNITED STATES REQUEST
FOR ENTRY OF DEFAULT JUDGMENT, with accompanying proposed default
judgment, was served via ECF Filing and/or United States Mail, postage pre-paid, as
follows:
John Parks Trowbridge, Jr.
25117 Ramrock Dr.
Porter, TX 77365
John Parks Trowbridge, Jr., Trustee
Freedom Ventures, UBO
25117 Ramrock Dr.
Porter, TX 77365
Lori Gruver
Linebarger Goggan, et al.
PO Box 17428, Suite 400
Austin, TX 78760
JOSHUA D. SMELTZER

Page 4 of 4
14-20333.95

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
DEFAULT JUDGMENT
The Court, having considered the UNITED STATES REQUEST FOR ENTRY OF
DEFAULT JUDGMENT, and any response or reply thereto, it is hereby ADJUDGED
that:
1.
The United States motion is GRANTED; and
2.
Freedom Ventures, UBO is HEREBY in DEFAULT for failing to plead or
otherwise defend against the United States Complaint and has failed to assert any
interest in the property at issue.
SIGNED this ________ day of _____________________________ , 2014.
________________________________
UNITED STATES DISTRICT JUDGE
808887.1
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14-20333.113

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES MOTION FOR SUMMARY JUDGMENT

AND MEMORANDUM IN SUPPORT
Pursuant to Fed. R. Civ. P. 56, plaintiff United States of America moves for
summary judgment against defendant, John Parks Trowbridge, Jr. (Trowbridge.)
Based on the undisputed material facts, the United States is entitled to judgment as a
matter of law and foreclosure of its liens against property subject to the liens.
INTRODUCTION
After years of using frivolous arguments to stall, delay, and evade collection,
Trowbridges tax debt has reached $3,326,015, plus statutory additions. The time has
come for Trowbridge to pay what he owes. The United States Tax Court has already
ruled on the deficiencies owed by Trowbridge for the tax years at issue and certified
transcripts of account indicating the current amounts owed are attached to this motion.
The United States seeks judgment for amounts owed and to foreclose its tax liens
against property held by Trowbridge and subject to the federal tax liens.
14-20333.114
STATEMENT OF MATERIAL FACTS

Defendant, John Parks Trowbridge, Jr., owes the United States the following
amounts of unpaid federal income taxes, penalties, and interest:1
Type of Tax
Tax Period
Assessment Date
1040
1040
1040
1040
1040
1993
1994
1995
1996
1997
1/20/2004
1/20/2004
1/20/2004
1/16/2004
1/16/2004
Amount Due
Through
(April 7, 2014)
$357,940.55
$491,487.70
$490,011.48
$1,319,436.18
$667,139.10
TOTAL:
$3,326,015.01
Assessments were made following adjudication of the tax deficiencies against

Trowbridge by the U.S. Tax Court.2 Defendant, John Parks Trowbridge, Jr., was given
notice and demand was made for payment of the unpaid taxes on or about the
assessment dates listed above. As of April 7, 2014, defendant, John Parks Trowbridge,
Jr., owes the United States $3,326,015 for federal income taxes, penalties, and interest
accrued for the 1993, 1994, 1995, 1996, and 1997 tax years. Defendant, John Parks
Trowbridge, Jr., further owes all interest and statutory additions that accrue from
April 7, 2014, until his tax liabilities are paid.
On April 25, 2005, David Powers Homes S.T. LTD transferred by warranty deed
the real property located at 25117 Ramrock Drive, Porter, Texas (Porter property) to
Attached as Government Exhibit B-1, B-2, B-3, B-4, and B-5 are the certified transcripts of account for the
1993,1994, 1995, 1996, and 1997 tax years.
2 Copies of the Tax Court Memorandum Opinions finding deficiencies for the tax years 1993, 1994, 1996,
and 1997 are attached as Government Exhibits C-1 and C-2.
U.S. Motion for Summary Judgment
Page 2 of 8
1
14-20333.115
defendant, John Parks Trowbridge, Jr., said property being more specifically described
as follows: 3
Lot Sixteen (16), Block One (1), of Bentwood, Section One (1),
a Subdivision of 156.8 Acres of Land, Out of the William
Massey Survey, A-391, and the Mary Owens Survey, A-405,
in Montgomery County, Texas, as Imposed by the Map and
Dedication Records in Cabinet G, Sheets 138A through 141A
of the Map Records of Montgomery County, Texas.
On or about May 2, 2005, the warranty deed was recorded and, on that same
date, a deed of trust in the amount of $299,768 with DPH Mortgage, Ltd., was
recorded.4
The United States recorded notices of its tax lien securing the above liabilities in
the real property records of Montgomery County, Texas, on or about July 7, 2011, and
October 2, 2012, for the tax periods listed above.5
On or about October 25, 2012, a Real Property Bill of Exchange Contract and
Agreement between defendants, John Parks Trowbridge, Jr., and Freedom Ventures,
UBO, was filed with the Montgomery County Clerks Office.6 The contract purported
to transfer the Porter Property from defendant, John Parks Trowbridge, Jr., to
defendant, Freedom Ventures, UBO; however, the transfer was done after the tax
assessments were made and after the notices of federal tax liens were filed.7
A true and correct copy of the Warranty Deed and Deed of Trust are attached as Government Exhibit D.
Gov. Ex. D.
5 Copies of the Notices of Federal Tax Lien are attached as Government Ex. A.
6 A true and correct copy of the Real Property Bill of Exchange Contract and Agreement is attached as
Government Exhibit E.
7 Compare Gov. Ex. A (Notice of Federal Tax Liens) with Gov. Ex. E (Bill of Exchange Contract and
Agreement).
Page 3 of 8
3
4
14-20333.116
ARGUMENT
I.
JOHN PARKS TROWBRIDGE, JR. IS CURRENTLY INDEBTED TO THE UNITED STATES
FOR OUTSTANDING INCOME TAX LIABILITIES
An assessment of tax by the Internal Revenue Service (Service) is

presumptively correct.8 John Parks Trowbridge, Jr., was assessed for unpaid income tax
liabilities for the income tax years and is indebted to the United States in the amount of
$3,326,015, for the 1993 and 1997 income tax years, plus statutory additions accruing
from until paid. If tax liabilities are not paid on or before the statutory date for
payment9 then interest accrues on the underpayment from the due date until paid.10
Similarly, interest accrues with respect to assessed, but unpaid, penalties, additional
amounts, or additions to tax.11
The tax deficiencies were also adjudicated by the Tax Court in a prior
proceeding. Trowbridges tax deficiencies for the 1991, 1992, 1993, 1994, and 1995 tax
years were adjudicated by the Tax Court and he was found liable for those tax
amounts.12 This decision also included liability for certain additions and a $25,000
sanction penalty because the Tax Court found that [i]t is clear to us that Dr.
E.g., Affiliated Foods, Inc. v. Commissioner, 154 F.3d 527, 530 (5th Cir. 1998).
additional amounts, or additions to tax are treated as taxes and are, therefore, also entitled to
the presumption of correctness. See 26 U.S.C. 6665(a)(2); Affiliated Foods, 154 F.3d at 530.
10 26 U.S.C. 6601(a); See Bob Hamric Chevrolet, Inc. v. USA, Internal Revenue Service, 849 F. Supp. 500, 515
(W.D. Tex. 1994).
11 26 U.S.C. 6601(e)(2).
12 See Gov. Ex. C-1 at 3, 16.
Page 4 of 8
8
9 Penalties,
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Trowbridge took the lead in the sanctionable activity here.13 A similar decision was
entered by the Tax Court for the 1996 and 1997 tax years.14
Therefore, the United States is entitled, as a matter of law, to judgment against
John Parks Trowbridge, Jr., in the amount of $3,326,015, plus statutory additions
accruing from April 7, 2014, until paid.
II.
THE FEDERAL TAX LIENS AGAINST JOHN PARKS TROWBRIDGE, JR., SHOULD BE
FORECLOSED AGAINST INTEREST IN REAL PROPERTY
Plaintiff, United States of America, has valid and subsisting federal tax liens on
all property and rights to property belonging to the defendant, John Parks Trowbridge,
Jr., including his interest in the Porter Property. Pursuant to 26 U.S.C. 6321, a lien in
favor of the United States arises upon all property and rights to property, then owned
or acquired thereafter, when a person neglects or refuses to pay tax liabilities owed.15
The liens arose as of the dates of the assessments of the tax liabilities.16 The amounts
owed, as discussed above, were previously adjudicated by the Tax Court.17
On April 25, 2005, Trowbridge purchased real property located at 25117 Ramrock
Drive, Porter, Texas (Porter property) from David Powers Homes S.T. LTD and on or
about May 2, 2005, the warranty deed and deed of trust were recorded.18 Upon
Gov. Ex. C-1 at 27.

See Gov. Ex. C-2 at 3, 15, 27-28.
15 26 U.S.C. 6321.
16 26 U.S.C. 6322.
17 See Gov. Exs. C-1, C-2.
18 Gov. Ex. D.
13
14

Page 5 of 8
14-20333.118
assessment, the federal tax liens attached to the Porter Property.19 The United States
then recorded its notices of liens on or about July 7, 2011, and October 2, 2012.20 By the
time Trowbridge attempted to transfer the Porter Property to a self-controlled trust (i.e.
Freedom Ventures UBO) on October 25, 2012,21 the tax liens are already attached to that
property.22 Any transfer to the trust, regardless of validity, was done subject to the tax
liens already attached and recorded.23
The Montgomery County Tax Office has filed a claim for any outstanding ad
valorem taxes owed on the property, which are listed as [t]o be determined.24 To the
extent that ad valorem taxes are owed, the United States admits that they have priority
over the federal tax liens pursuant to 26 U.S.C. 6323(b)(6).
Pursuant to 26 U.S.C. 7403, the United States may enforce its tax liens by
foreclosing upon and selling the Porter Property and the Court may order the
foreclosure and sale of the property to satisfy the outstanding tax liabilities.25 Therefore,
the federal tax liens against Trowbridge should be foreclosed against the Porter
Property and the property should be sold.
See 26 U.S.C. 6321, 6322.

Gov. Ex. A.
21 Gov. Ex. E.
22 Gov. Ex. A.
23
See United States v. Cache Valley, 866 F.2d 1242, 1245 (10th Cir. 1989) (citing United States v. Bess, 357 U.S.
51, 57 (1958) for the proposition that a transfer does not affect the lien because no matter into whose
hands the property goes, the property passes cum onere, or with the lien attached.)
24 (Dkt. #10.)
25 See 26 U.S.C. 7403.
Page 6 of 8
19
20
14-20333.119
CONCLUSION
For the foregoing reasons, and based on the undisputed material facts, the
United States is entitled to a judgment against Trowbridge for $3,326,015, plus statutory
additions after April 7, 2014. The United States has valid and subsisting liens against
the Porter Property and that property should be foreclosed and sold.
DATE: April 4, 2014
KENNETH MAGIDSON
JOSHUA D. SMELTZER
Attorney-in-Charge
State Bar (Maryland)
Trial Attorney, Tax Division
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (Fax)

Page 7 of 8
14-20333.120
I certify that on April 4, 2014, the foregoing UNITED STATES MOTION FOR
SUMMARY JUDGMENT AND MEMORANDUM IN SUPPORT, with accompanying
proposed order, was served via ECF Filing and/or United States Mail, postage prepaid, as follows:
25117 Ramrock Dr.
Porter, TX 77365
25117 Ramrock Dr.
Porter, TX 77365
Lori Gruver
Austin, TX 78760
JOSHUA D. SMELTZER

Page 8 of 8
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Government
Exhibit
A
_____________
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of America
United States
Department of the Treasury

Internal Revenue Service
Date:
25 March 2014
CERTIFICATE OF OFFICIAL RECORD
I certify that the annexed:

transcript of the taxpayer named therein in respect to the taxes specified, is a true and correct transcript for the
period stated, of all assessments, penalties, interest, abatements, credits, refunds, and advance or unidentified
payments relating thereto as disclosed by the records of this office as of the date of this certification. It
consists of 3 pages.
under the custody of this office.

IN WITNESS WHEREOF, I have hereunto set my hand,
and caused the seal of this office to be affixed, on the day
and year first above written.
By direction of the Secretary of the Treasury:
William W. Legare, Insolvency Manager

Small Business/Self-Employed Division, Gulf States Area
Oklahoma City, Oklahoma
Catalog Number 19002E
Government
Exhibit
B-1
_____________
Form 2866 (Rev. 09-1997)
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Case
Account Transcript
4:14-cv-00027
19-2
Filed in TXSD on 04/04/14 Page 3 of 4
3513 1040ADocument
Dec. 31, 1993
TROW
Page 2 of3
n/a
18210-070-00172-5
570
Additional account action pending
04-10-1995
$0. 00
420
Examination of tax return
03-31-1995
$0. 00
610
Payment with return
12-03-1996
-$1,000. 00
976
Duplicate return filed
12-03-1996
$0. 00
n/a
18211-340-93001-6
08-11-1999
$0. 00
20010608 02-19-2001
$0. 00
560
IRS can assess tax until

11-15-2000
300
Additional tax assessed by examination
n/a
18247-426-10016-1
520
Bankruptcy or other legal action filed
01-29-2001
$0. 00
960
Appointed representative
12-17-2002
$0. 00
961
Removed appointed representative
01-13-2003
$0. 00
960
12-17-2002
$0. 00
300
20040508 02-16-2004
$0. 00
n/a
49247-426-70009-4
421
Closed examination of tax return
02-16-2004
$0. 00
521
Removed bankruptcy or other legal action
01-24-2004
$0. 00
20040608 01-20-2004
$83,478. 00
300
Additional tax assessed by examination - quick

assessment
n/a
49251-020-13503-4
160
Penalty for filing tax return after the due date
20040608 01-20-2004
$20,870. 00
170
Penalty for not pre-paying tax
20040608 01-20-2004
$3,498. 00
190
Interest charged for late payment
20040608 01-20-2004
$116,359. 25
971
Tax period blocked from automated levy program
03-29-2004
$0. 00
971
Pending installment agreement
03-04-2004
$0. 00
530
Balance due account currently not collectable
06-17-2004
$0. 00
537
Account currently considered collectable
09-20-2004
$0. 00
961
11-12-2010
$0.00
Collection due process Notice of Intent to Levy
06-15-2011
$0. 00
06-15-2011
$0. 00
Lien placed on assets due to balance owed
07-01-2011
$0. 00
Issued notice of lien filing and right to Collection Due
07-07-2011
$0. 00
10-22-2012
$0. 00
20124105 10-22-2012
$20,619. 50
971
issued
971
return receipt signed

582
971
Process hearing
971
Notice issued
CP 071D
276
Penalty for late payment of tax
582
02-22-2013
$0. 00
02-26-2013
$0. 00
971
Process hearing
https://eup.eps.irs.gov/esrv/tds/requests/TdsProductAction.do?method=productDetails
14-20333.132
3/25/2014
Case
Account Transcript
670
4:14-cv-00027
19-2
3513 1040ADocument
Dec. 31, 1993
TROW
Payment
Page 3 of3
05-29-2013
-$4,184. 70
Levy
582
06-07-2013
$0. 00
670
Payment
06-12-2013
-$8,621. 38
07-23-2013
-$16,756. 70
Levy
670
Payment
Levy
520
08-08-2013
$0. 00
670
Payment
08-23-2013
-$2,525. 62
Levy
520
12-16-2013
$0. 00
582
12-20-2013
$0. 00
14-20333.133
3/25/2014
United States
of America

Date:
25 March 2014



Government
Exhibit
B-2
_____________
Form 2866 (Rev. 09-1997)
14-20333.134
Account Transcript
Case
3513 1040 Dec.

31, 199419-3
TROW
4:14-cv-00027
Document
Page 1 of3

United States Department of the Treasury
This
Account Transcript
FORM NUMBER:
1040
TAX PERIOD:
Dec.
Request Date:
03-25-2014
Response Date:
03-25-2014
Tracking Number:
100188758039
31, 1994
TAXPAYER IDENTIFICATION NUMBER:
3513
SPOUSE TAXPAYER IDENTIF ICATION NUMBER:
8335
JOHN P TROWBRIDGE
--- ANY M INUS SIGN SHOWN BELOW SIGNIFIES A CREDIT AMOUNT

ACCOUNT BALANCE:
297,121. 30
ACCRUED INTEREST:
194,366. 40
ACCRUED PENALTY:
0.00
AS OF: Apr. 07, 2014

AS OF: Apr.
07, 2014
ACCOUNT BALANCE PLUS ACCRUALS

(this is not a payoff amount):
**
491,487. 70
INFORMATION FROM THE RETURN OR AS ADJUSTED
EXEMPTIONS:
**
01
F I L ING STATUS:
Married
Filing Separate
ADJUSTED GROSS INCOME:
280,628. 00
TAXABLE INCOME:
277,453. 50
TAX PER RETURN:
170,144. 00
60,600. 00
SE TAXABLE INCOME TAXPAYER:
0. 00
SE TAXABLE INCOME SPOUSE:
23,051. 00
TOTAL SELF EMPLOYMENT TAX:
RETURN DUE DATE OR RETURN RECEIVED DATE
(WHICHEVER IS LATER)
PROCESSING DATE
Jan.
21, 1997
Mar.
24, 1997
TRANSACTIONS
CODEEXPLANATION OF TRANSACTION
CYCLE DATE
AMOUNT
14-20333.135
3/25/2014
Case
AccoUnt Transcript
4:14-cv-00027
Document
3513 1040 Dec.
31, 199419-3
TROW
Page 2 of3
19971108 03-24-1997
$170,144. 00
01-21-1997
-$1,000. 00
19971108 03-24-1997
$8,766. 14
166
19971108 03-24-1997
$38,282. 40
276
19971108 03-24-1997
$20,407. 28
196
19971108 03-24-1997
$39,634. 34
420
04-11-1997
$0. 00
582
07-04-1997
$0. 00
Payment
07-29-1997
-$1,769. 90
150
Tax return filed
n/a
18211-022-93115-7
610
Payment with return
176
670
Miscellaneous Payment
470
Claim pending
11-03-1997
$0. 00
472
Reversed claim processed in error
07-28-1998
$0. 00
271
Reduced or removed penalty for late payment of tax
09-21-1998
-$20,407. 28
171
Reduced or removed penalty for not pre-paying tax
03-24-1997
-$8,766. 14
Reduced or removed penalty for filing tax return after
03-24-1997
-$38,282. 40
09-21-1998
-$170,144. 00
09-21-1998
-$39,634. 34
19983908 10-12-1998
$0. 00
161
the due date

291
Prior tax abated
n/a
18254-629-06371-8
197
Reduced or removed interest charged for late payment
290
Additional tax assessed
n/a
18254-651-05852-8
420
02-26-1999
$0. 00
08-11-1999
$0. 00
20010608 02-19-2001
$0. 00
560
11-15-2000
300
n/a
18247-426-10017-1
520
01-29-2001
$0. 00
960
12-17-2002
$0. 00
961
01-13-2003
$0. 00
960
12-17-2002
$0. 00
300
20040508 02-16-2004
$0. 00
n/a
49247-426-70010-4
421
02-16-2004
$0. 00
521
01-24-2004
$0. 00
300
20040608 01-20-2004
$121,075. 00
assessment
n/a
49251-020-13504-4
160
20040608 01-20-2004
$30,269. 00
170
20040608 01-20-2004
$6,283. 00
14-20333.136
3/25/2014
Account Transcript
Case
513 1040 Dec.

31, 1994
TROW
4:14-cv-00027
Document
19-3
190
971
Page 3 of3
20040608 01-20-2004
$142,264. 20
03-29-2004
$0. 00
971
03-04-2004
$0.00
530
06-17-2004
$0. 00
537
09-20-2004
$0. 00
961
11-12-2010
$0.00
06-15-2011
$0. 00
06-15-2011
$0. 00
971
issued
971

582
09-28-2012
$0. 00
971
Notice issued
10-22-2012
$0. 00
CP 071D
971

Process hearing
10-04-2012
$0. 00
582
02-22-2013
$0.00
971

Process hearing
02-26-2013
$0.00
971
Collection due process request received timely
05-14-2013
$0. 00
Collection due process equivalent
05-14-2013
$0. 00
971
(hearing) request
received
582
06-07-2013
$0.00
520
08-08-2013
$0.00
08-22-2013
$0.00
971
(hearing) resolved by
appeals - decision letter issued or you withdrew the

hearing request
520
12-16-2013
$0.00
582
12-20-2013
$0. 00
This Product Contains Sensitive
Data
https :IIeup.eps.irs.govIesrvltdslrequestsiTdsProductAction.do ?method=productDetails
14-20333.137
312512014
of America
United States

Date:
25 March 2014



Government
Exhibit
B-3
_____________
Form 2866 (Rev. 09-1997)
14-20333.138
Case
Account Transcript
4:14-cv-00027
Document
3513 1040 Dec.
31, 199519-4
TROW
Page 1 of3

United States Dep arlment of the Treasury
Account Transcript
Request Date:
FORM NUMBER:
1040
TAX PER IOD:
Dec.
03-25-2014
Response Date:
03-25-2014
Tracking Number:
100188758039
31, 1995
TAXPAYER IDENTIFICATION NUMBER:
3513
SPOUSE TAXPAYER IDENTIFICATION NUMBER:
8335
JOHN P TROWBRIDGE
--- ANY MINUS SIGN SHOWN BELOW SIGNIFIES A CREDIT AMOUNT

ACCOUNT BALANCE:
296,279. 37
ACCRUED INTEREST:
193,732. 11
AS OF: Apr.
07, 2014
0. 00
AS OF: Apr.
07, 2014
ACCRUED PENALTY:
ACCOUNT BALANCE PLUS ACCRUALS

(this is not a payoff amount) :
**
490,011. 48
INFORMATION FROM THE RETURN OR AS ADJUSTED
EXEMPTIONS:
**
01
F IL ING STATUS:
Married Filing Separate
ADJUSTED GROSS INCOME:
308,789. 00
TAXABLE INCOME:
311,670. 00
TAX PER RETURN:
133,977. 00
61,200. 00
SE TAXABLE INCOME TAXPAYER:
0. 00
SE TAXABLE INCOME SPOUSE:
24,232. 00
TOTAL SELF EMPLOYMENT TAX:
RETURN DUE DATE OR RETURN RECEIVED DATE
(WH ICHEVER IS LATER)
PROCESS ING DATE
Jan.
27, 1997
Mar.
17, 1997
TRANSACTIONS
CODEEXPLANATION OF TRANSACTION
CYCLE DATE
https :IIeup.eps.irs. govIesrvltdslrequestsiTdsProductAction.do ?method=productDetails
AMOUNT
14-20333.139
3125/2014
Case
Account Transcript
4:14-cv-00027
Document
3513 1040 Dec.
31, 199519-4
TROW
150
Tax return filed
n/a
18211-027-93108-7
610
Payment with return
166
Page 2 of3
19971008 03-17-1997
$133,977. 00
01-27-1997
-$1,000. 00
19971008 03-17-1997
$30,144. 83
276
19971008 03-17-1997
$8,028. 62
196
19971008 03-17-1997
$13,761. 63
420
03-28-1997
$0. 00
582
07-04-1997
$0. 00
360
Fees and other expenses for collection
08-04-1997
$44. 00
470
Claim pending
11-03-1997
$0. 00
472
07-28-1998
$0. 00
470
Claim pending
08-05-1998
$0. 00
03-17-1997
-$30,144. 83
161
the due date

271
02-15-1999
-$8,028. 62
291
Prior tax abated
02-15-1999
-$133,977. 00
n/a
18254-737-05717-8
197
02-15-1999
-$13,761. 63
846
Refund issued
02-15-1999
$1,113. 90
776
Interest credited to your account
02-15-1999
-$157. 90
841
Refund cancelled
02-15-1999
-$1,113. 90
777
Reduced or removed interest credited to your account
02-15-1999
$157. 90
420
02-26-1999
$0. 00
08-11-1999
$0. 00
20010608 02-19-2001
$0.00
560
11-15-2000
300
n/a
18247-426-10018-1
520
01-29-2001
$0. 00
960
12-17-2002
$0. 00
961
01-13-2003
$0. 00
960
12-17-2002
$0. 00
300
20040508 02-16-2004
$0. 00
n/a
49247-426-70011-4
421
02-16-2004
$0. 00
521
01-24-2004
$0. 00
300
20040608 01-20-2004
$130,699. 00
assessment
n/a
49251-020-13505-4
160
20040608 01-20-2004
$32,595. 00
170
20040608 01-20-2004
$7,068. 00
https://eup.eps.irs.govIesrv/tds/requests/TdsProductAction.do ?method=productDetails
14-20333.140
3/25/2014
Case
Ac'count Transcript
4:14-cv-00027
Document
19-4
3513 1040 Dec.
31, 1995
TROW
190
971
Page 3 of3
20040608 01-20-2004
$126,747. 37
03-29-2004
$0. 00
971
03-04-2004
$0. 00
977
Amended return filed
03-11-2004
$0. 00
n/a
49277-476-01946-4
530
06-17-2004
$0. 00
290
Additional tax assessed
20042908 08-02-2004
$0. 00
n/a
83254-596-05003-4
961
11-12-2010
$0.00
971
Notice issued
10-10-2011
$0. 00
CP 071A
531
09-06-2012
$0. 00
971
Notice issued
CP 071A
10-08-2012
$0. 00
971
09-24-2012
$0. 00
issued
582
09-28-2012
$0. 00
360
10-22-2012
$64. 00
09-27-2012
$0. 00
10-04-2012
$0. 00
971

971

Process hearing
470
Claim pending
10-31-2012
$0. 00
582
02-22-2013
$0. 00
360
03-18-2013
$20. 00
971

Process hearing
02-26-2013
$0. 00
971
05-14-2013
$0. 00
(hearing)
request
received
582
06-07-2013
$0. 00
360
07-08-2013
$42. 00
520
08-08-2013
$0. 00
08-22-2013
$0. 00
971
(hearing) resolved by

hearing request
470
Claim pending
11-20-2013
$0. 00
520
12-16-2013
$0. 00
582
12-20-2013
$0. 00
https:lIeup.eps.irs.govIesrvltdslrequestsiTdsProductAction.do?method=productDetails
14-20333.141
312512014
of America
United States

Date:
25 March 2014



Government
Exhibit
B-4
_____________
Form 2866 (Rev. 09-1997)
14-20333.142
14-20333.143
Case
Account Transcript
4:14-cv-00027
Document
19-5
3513 1040 Dec.
31, 1996
TROW
150
Tax return filed
n/a
18211-293-07802-7
460
Page 2 of3
19975008 12-22-1997
$36,851. 00
Extension of time to file ext. Date 08-15-1997
04-15-1997
$0. 00
460
Extension of time to file ext. Date 10-15-1997
08-18-1997
$0. 00
610
Payment with return
10-20-1997
-$100. 00
176
19975008 12-22-1997
$1, 961. 40
276
19975008 12-22-1997
$1,656. 79
196
19975008 12-22-1997
$2,350. 79
Denied either claim made on Form 843 or request for
19981208 04-06-1998
$0. 00
290
removal of penalty
n/a
18254-455-98000-8
470
Claim pending
03-23-1998
$0. 00
472
11-20-1998
$0. 00
171
Reduced or removed penalty for not pre-paying tax
12-22-1997
-$1,961. 40
271
02-15-1999
-$1,656. 79
291
Prior tax abated
02-15-1999
-$36,851. 00
n/a
18254-752-05459-8
197
02-15-1999
-$2,350. 79
846
Refund issued
02-15-1999
$109. 91
776
Interest credited to your account
02-15-1999
-$9. 91
841
Refund cancelled
02-15-1999
-$109. 91
777
Reduced or removed interest credited to your account
02-15-1999
$9. 91
420
02-26-1999
$0. 00
670
Payment
01-28-2000
-$100. 00
570
02-21-2000
$0. 00
977
01-28-2000
$0. 00
n/a
18277-442-00844-0
300
20010608 02-19-2001
$0. 00
n/a
18247-432-10052-1
520
02-12-2001
$0. 00
960
12-17-2002
$0. 00
961
01-13-2003
$0. 00
960
12-17-2002
$0. 00
300
20040408 02-09-2004
$0. 00
n/a
49247-420-70016-4
421
02-09-2004
$0. 00
521
01-20-2004
$0. 00
https:lIeup.eps.irs.govIesrvltdslrequestsiTdsProductAction.do ?method=productDetails
14-20333.144
312512014
Case 4:14-cv-00027
Document 19-5 Filed in TXSD on 04/04/14 Page 4 of 4
3513 1040 Dec. 31, 1996 TROW
Acoount Transcript
300
Page 3 of3
20040608 01-16-2004
$384,587.00
assessment
n/a
49251-016-13600-4
160
20040608 01-16-2004
$96,147.00
170
20040608 01-16-2004
$20,470.00
190
20040608 01-16-2004
$296,122.81
971
03-29-2004
$0.00
971
03-04-2004
$0.00
530
06-17-2004
$0.00
537
09-20-2004
$0.00
961
11-12-2010
$0.00
971

issued
06-15-2011
$0.00
Collection due process Notice of Intent to Levy --
06-15-2011
$0.00
971

582
07-01-2011
$0.00
360
07-25-2011
$64.00
07-07-2011
$0.00
10-22-2012
$0. 00
971
Process hearing
971
Notice issued
CP 071D
582
02-22-2013
$0. 00
971

Process hearing
02-26-2013
$0.00
582
06-07-2013
$0.00
520
08-08-2013
$0.00
520
12-16-2013
$0.00
582
12-20-2013
$0.00
360
02-10-2014
$210.00
This Product Contains Sensitive
Data
14-20333.145
3/25/2014
United States
of America

Date:
25 March 20 l4
I certify that the annexed



Government
Exhibit
B-5
_____________
Form 2866 (Rev. 09-1997)
14-20333.146
14-20333.147
Case 4:14-cv-00027
Document 19-6 Filed in TXSD on 04/04/14 Page 3 of 4
3513 1040 Dec. 31, 1997 TROW
Account Transcript
150
Tax return filed - quick assessment
n/a
76251-022-13000-9
460
Extension of time to file ext.
610
Payment with return
163
Page 2 of3
01-22-1999
$44,763. 00
04-15-1998
$0. 00
10-22-1998
-$100. 00
19990608 01-22-1999
$6,029. 50
270
19990608 01-22-1999
$1,563. 21
190
19990608 01-22-1999
$1,989. 52
470
Claim pending
02-23-1999
$0. 00
161
01-22-1999
-$6,029. 50
Date 08-15-1998
the due date

271
04-12-1999
-$1,563. 21
291
Prior tax abated
04-12-1999
-$44,763. 00
n/a
18254-483-06922-9
197
04-12-1999
-$1,989. 52
420
05-07-1999
$0. 00
05-10-1999
$0. 00
560
10-22-2001
670
Payment
01-28-2000
-$100. 00
570
02-21-2000
$0. 00
977
01-28-2000
$0. 00
n/a
18277-442-00821-0
300
20010608 02-19-2001
$0. 00
n/a
18247-432-10051-1
520
02-12-2001
$0. 00
960
12-17-2002
$0. 00
961
01-13-2003
$0. 00
960
12-17-2002
$0. 00
300
20040408 02-09-2004
$0. 00
n/a
49247-420-70017-4
421
02-09-2004
$0. 00
521
01-20-2004
$0. 00
300
20040608 01-16-2004
$211,508. 00
assessment
n/a
49251-016-13601-4
160
20040608 01-16-2004
$52,887. 00
170
20040608 01-16-2004
$11,316. 00
190
20040608 01-16-2004
$127,621. 59
971
03-29-2004
$0. 00
971
03-04-2004
$0. 00
https://eup.eps.irs.gov/esrv/tds/requests/TdsProductAction.do?rnethod=productDetails
14-20333.148
3/25/2014
Account Transcript
3513 1040 Dec. 31, 1997 TROW
Page 3 of3
530
06-17-2004
$0. 00
961
11-12-2010
$0. 00
971
Notice issued
CP 071A
10-10-2011
$0. 00
531
09-06-2012
$0. 00
971
Notice issued
CP 071A
10-08-2012
$0. 00
09-24-2012
$0. 00
971
issued
582
09-28-2012
$0. 00
971
09-27-2012
$0. 00
10-04-2012
$0. 00
02-22-2013
$0. 00
02-26-2013
$0. 00
05-14-2013
$0. 00

971

Process hearing
582
971
Process hearing
971
(hearing)
request
received
582
06-07-2013
$0. 00
520
08-08-2013
$0. 00
971
08-22-2013
$0. 00
(hearing)
resolved by

hearing request
520
12-16-2013
$0. 00
582
12-20-2013
$0. 00
https :IIeup.eps.irs.govIesrvltdslrequestsiTdsProductAction.do ?method=productDetails
14-20333.149
312512014
T.C. Memo. 2003-164
UNITED STATES TAX COURT
JOHN PARKS TROWBRIDGE, Petitioner y.

COMMISSIONER OF INTERNAL REVENUE, Respondent
SABRINA MARTIN, f.k.a. SABRINA L. TROWBRIDGE, Petitioner y.
Docket Nos. 473-01, 474-01.
Filed June 4, 2003.
R determined deficiencies in tax with respect to

Ps (H and W) for the years 1991-95, as well as
additions to tax under sees. 6651(a) (1) and 6654,
I.R.C., with respect to various of those years.
Ps
filed petitions for redetermination but failed to
appear at trial.
R moved for default judgment with
respect to the deficiencies in tax determined against
Ps for all years and the additions to tax determined
against H for the years 1991-93. R proceeded to trial
on the issues of (1) the additions to tax determined
against W for all years, and (2) the additions to tax
determined against H for 1994 and 1995.
Government
Exhibit
C-1
_____________
14-20333.150
- 2 1.
Held: R's motion for default judgment is granted.
2.
further, Forms 1040 and 1040EZ filed by
Ps do not constitute valid Federal income tax returns.
3.
Held, further, Ps are liable for the additions
to tax at issue in the amounts determined by R, with
minor adjustments.
4.
Held, further, Hand Ware liable for
penalties under sec. 6673, I.R.C., in the amounts of
$25,000 and $15,000, respectively.
John Parks Trowbridge and Sabrina Martin, pro sese.

M. Kathryn Bellis, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION

HALPERN, Judge:
These cases have been consolidated for
purposes of trial, briefing, and opinion.

deficiency dated October 11, 2000
By notices of
(the notices of deficiency),
respondent determined deficiencies in, and additions to, each

petitioner's Federal income taxes as follows:
John Parks Trowbridge (Dr. Trowbridge)
Year
1991
1992
1993
1994
1995
Deficiency
$6,533
9,492
83,478
121,075
130,699
Additions to Tax
Sec. 6651 {a! {12
Sec. 6654
$4
$1,380
222
20,870
3,498
30,269
6,283
32,595
7,068
14-20333.151
- 3 -
Sabrina L. Trowbridge (Ms. Martin 1 )

Year
1991
1992
1993
1994
1995
Deficiency
$6,197
8,740
74,612
102,588
111,266
Additions to Tax
Sec. 6651 (a) (1)
Sec. 6654
$105
$190
1,198
3,126
18,653
25,647
5,323
27,679
6,000
Respondent has moved that petitioners be held in default

with respect to the deficiencies in tax determined against them
for all years and that Dr. Trowbridge be held in default with
respect to the additions to tax determined against him for 1991,
1992, and 1993.
In addition, respondent has moved for partial
summary judgment in his favor with respect to the additions to

tax determined against Dr. Trowbridge for 1994 and 1995 and the
additions to tax determined against Ms. Martin for all years.
Respondent has also asked the Court to impose a penalty on each
petitioner under section 6673(a) (1)
in the amount of $25,000.
For the reasons that follow, we shall grant respondent's motions

for default judgment, sustain (with minor adjustments) the
additions to tax that are the subject of his motions for partial
summary judgment, and impose penalties under section 6673(a) (1).
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the years at issue, and
all Rule references are to the Tax Court Rules of Practice and
During the years

Trowbridge and was known
known as Sabrina Martin,
for all purposes in this
at issue, Ms. Martin was married to Dr.

as Sabrina L. Trowbridge.
She is now
and we shall refer to her as Ms. Martin
report.
14-20333.152
- 4 Procedure.
For the sake of convenience, all dollar amounts are
rounded to the nearest dollar.

FINDINGS OF FACT
Preliminary Facts
At the time the petitions were filed in these cases, each
petitioner resided in Harris County, Texas.
Petitioners were married to each other during the years at
issue but filed separate returns for those years.
Dr. Trowbridge is a physician, and Ms. Martin is a nurse and
administrative assistant who, during the years at issue, was
sometimes employed by Dr. Trowbridge's professional corporation.
Both petitioners are calendar year taxpayers.
Respondent's examination with respect to Dr. Trowbridge's
1991, 1992, and 1993 taxable years commenced before 1998.
Respondent's examinations with respect to Dr. Trowbridge's 1994
and 1995 taxable years and Ms. Martin's 1991 through 1995 taxable
years commenced after July 1998.
Dr. Trowbridge's 1993, 1994, and 1995 Forms 1040
1993 Form 1040 2
On November 26, 1996, Dr. Trowbridge mailed to the Internal
Revenue Service (IRS) a Form 1040, U.S. Individual Income Tax
Return 1993 (Dr. Trowbridge's 1993 Form 1040), which the IRS
As discussed infra, Dr. Trowbridge's 1993 Form 1040 is

relevant to the determination of whether he is liable for the
sec. 6654 addition to tax with respect to his 1994 taxable year.
14-20333.153
received on December 3, 1996.
5 -
On page 2 of Dr. Trowbridge's 1993
Form 1040, he reported tax of $92,494 but stated: "SEE ATTACHED

DISCLAIMER STATEMENT--ADMITTED TAX LIABILITY IS ZERO".
The
attached disclaimer statement (the 1993 disclaimer) reads in part

as follows:
The assessment and payment of income taxes is voluntary
* * * John respectfully declines to volunteer
concerning assessment and payment of any tax balance
due on the return or any redetermination of said tax.
Be it known that we, separately and together,
therefore, deny tax liability and do not admit that the
stated amount of tax on return, as calculated solely by
reference to provided tables, is due and collectible.
The tax return read as a whole shows no amount as being
the tax and shows the tax to be zero and zero is the
starting point in determining a deficiency or any other
action involving this return.
* * *
John has provided payment in the amount of $1,000 as a
voluntary contribution.
The 1993 disclaimer is signed by Dr. Trowbridge and "Acknowledged
in full agreement" by Ms. Martin.
Respondent determined a deficiency in Dr. Trowbridge's tax
for 1993 of $83,478.
1994 Form 1040
On January 16, 1997, Dr. Trowbridge mailed to the IRS a Form
1040, U.S. Individual Income Tax Return 1994
(Dr. Trowbridge's
1994 Form 1040), which the IRS received on January 21, 1997.
On
page 2 of Dr. Trowbridge's 1994 Form 1040, he reported tax of

$170,144 but stated: "SEE ATTACHED DISCLAIMER STATEMENT--ADMITTED
14-20333.154
- 6 TAX LIABILITY IS ZERO".
In substance, the attached disclaimer is
identical to the 1993 disclaimer.

Dr. Trowbridge submitted to the IRS no other document
purporting to be a return for 1994.
for 1994 of $121,075.
The only payment made by Dr. Trowbridge
for 1994 was $1,000 paid on January 21, 1997, with his 1994 Form
1040.
1995 Form 1040
On January 20, 1997, Dr. Trowbridge mailed to the IRS a Form
1040, U.S. Individual Income Tax Return 1995 (Dr. Trowbridge's
1995 Form 1040), which the IRS received on January 27, 1997.
On
page 2 of Dr. Trowbridge's 1995 Form 1040, he reported tax of

$133,977 but stated: "SEE ATTACHED DISCLAIMER STATEMENT--ADMITTED
TAX LIABILITY IS ZERO".
In substance, the attached disclaimer is

Dr. Trowbridge submitted to the IRS no other document
purporting to be a return for 1995.
for 1995 of $130,699.
The only payment made by Dr. Trowbridge
for 1995 was $1,000 paid on January 27, 1997, with his 1995 Form
1040.
14-20333.155
- 7 -
Ms. Martin's 1991 Through 1995 Income Tax Filings

1991 Form 1040
On or around November 1, 1996, Ms. Martin mailed to the IRS
a Form 1040, U.S. Individual Income Tax Return 1991
(Ms. Martin's
1991 Form 1040), which the IRS received on November 4, 1996.
On
page 2 of Ms. Martin's 1991 Form 1040, she reported tax of $5,203
and withholding of $19,640.
She also stated: "SEE ATTACHED
The
attached disclaimer refers to her but, in substance, is identical

to the 1993 disclaimer.
Ms. Martin submitted to the IRS no other document purporting
to be a return for 1991.
Respondent determined a deficiency in Ms. Martin's tax for
1991 of $6,197.
The only payment made by Ms. Martin for 1991 was
$100 paid on November 4, 1996, with her 1991 Form 1040.

1992 Form 1040
On or around November 1, 1996, Ms. Martin mailed to the IRS
a Form 1040, U.S. Individual Income Tax Return 1992
(Ms. Martin's
1992 Form 1040), which the IRS received on November 4, 1996.
On
page 2 of Ms. Martin's 1992 Form 1040, she reported tax of $1,805
and withholding of $7,944.
She also stated: "SEE ATTACHED
The
attached disclaimer refers to her but, in substance, is identical

to the 1993 disclaimer.
14-20333.156
- 8 -

Respondent determined a deficiency in Ms. Martin's tax for
1992 of $8,740.
The only payment made by Ms. Martin for 1992 was
$100 paid on November 4, 1996, with her 1992 Form 1040.

1993 and 1994 Tax Obligations
Ms. Martin did not file Federal income tax returns for
either 1993 or 1994.
She did not make any estimated tax payments
for those years.

Respondent determined deficiencies of $74,612 and $102,588
in Ms. Martin's taxes for 1993 and 1994, respectively.
1995 Form 1040EZ
On or about January 20, 1997, Ms. Martin mailed to the IRS a
Form 1040EZ, Income Tax Return for Singles and Joint Filers With
No Dependents 1995 (Ms. Martin's 1995 Form 1040EZ), which the IRS
received on January 21, 1997.
On Ms. Martin's 1995 Form 1040EZ,
she reported tax of $0, an earned income credit of $234, and

withholding of $635.
She also stated: "SEE ATTACHED DISCLAIMER
STATEMENT--ADMITTED TAX LIABILITY IS ZERO".
The attached
disclaimer refers to her but, in substance, is identical to the

1993 disclaimer.
14-20333.157
- 9 Respondent determined a deficiency in Ms. Martin's tax for

1995 of $111,266.
The only payment made by Ms. Martin for 1995
was $100 paid on January 21, 1997, with her 1995 Form 1040EZ.
The Pleadings and Related Matters
The Petitions
In response to the notices of deficiency, both petitioners
filed petitions on January 9, 2001.
petitions are identical.
In many respects, the
Dr. Trowbridge's petition is 74 pages
long, and Ms. Martin's petition is 75 pages long.
Although the
petitions do assign error to respondent's determinations, for the

most part, they make a convoluted argument that subjecting
petitioners to the same rate of tax as Federal employees
constitutes impermissible "disparate treatment".
Petitioners
cite a variety of Code sections and regulatory materials to show

that public employees and certain others receive benefits from
the Federal Government that are not available to petitioners as
"private independent contractors" or "private sector workers".
They state:
In direct contrast to the private independent
contractor, or non-government workers whose economic
position, and rate of personal earnings are not fixed
and guaranteed by statute, the rate instead is
controlled by what the market place will bear and
without any position fixed by statute.
This gives the
government employees or officers a great personal and
economic advantage over that afforded to the private
independent contractor, or non-government workers, and
as such creates a disparate or unequal treatment under
the law, because the Internal Revenue Service
administratively states that the private independent
14-20333.158
- 10 contractors, or private sector workers pay [sic] must

pay the same rate or percentage of tax on net income as
do the government employees under Title 26 USC 1, or
3, without affording these same government privileges,
services, benefits, contributions, or funds.
They argue that either respondent has to afford them a lower,
special tax rate or they must be afforded the same benefits as
Federal Government employees:
it is the position of this petitioner, that there is
within the Internal Revenue Code (IRC), a separate
taxing statute with a reduced or compensatory rate of
tax for the taxpayers who are "private independent
contractors", or "private sector workers".
If not,
then this petitioner is entitled to receive the same
compensation in benefits and economic protections as
the federal employee, appointed or elected official, or
corporate or partnership individuals.
Respondent's Motions for a More Definite Statement
In response to the petitions, respondent moved in each case
for a more definite statement or to dismiss for failure to state
a claim upon which relief can be granted.
Following a hearing on
respondent's motions, we declined to dismiss but concluded that

the petitions contained frivolous and groundless allegations.
We
struck from the petitions all such allegations, which constituted

the bulk of the petitions.
The Answers
On May 17, 2001, respondent filed his answers to the
abridged petitions, denying all material allegations of fact made
in support of the lone remaining assignment of error contained
therein.
14-20333.159
- 11 Standing Pretrial Order and Notice

On May 29, 2001, the Court issued its Standing Pretrial
Order and Notice in each case, setting the cases for trial at the
trial session of the Court commencing on December 3, 2001, in
Houston, Texas.
Petitioners' Discovery Reguests
On September 20 and 25, 2001, Ms. Martin and Dr. Trowbridge,
respectively, served on respondent a request for admissions.
Each request is over 140 pages in length (without attachments)
and requests over 600 admissions.
On September 27, 2001, each petitioner served on respondent
interrogatories and a request for production of documents.
Each
set of interrogatories is over 125 pages in length and contains

over 500 interrogatories.
On October 4, 2001, respondent filed motions for protective
orders with respect to the requests for admissions,
interrogatories, and requests for production of documents served
by petitioners.
Respondent argued that such requests were not
timely, addressed improper issues, and were intended to burden

respondent unduly, waste his resources, and divert him from trial
preparation.
We asked petitioners to respond and, after
considering their responses, granted respondent relief

"substantially for the reasons stated in respondent's motions."
14-20333.160
- 12 Petitioners' Dismissal Efforts

Motions To Dismiss for Lack of Jurisdiction
On November 21, 2001, Dr. Trowbridge submitted "for the
petitioners" a motion styled "Petitioner's Verified Challenge to
Jurisdiction of the Court", which we filed in each case as a
motion to dismiss for lack of jurisdiction.
The motion "denies
the existence of any contracts or commercial agreements which

create an attachment of an equity relationship between the
'United States' and/or The State of Texas and Petitioner."
motion also states:
waived,
The
"Petitioner has specifically forfeited,
rejected, declined, and refused to voluntarily accept any
and all benefits, especially admiralty and limited debt liability

benefits, from the 'United States' and its instrumentalities."
Apparently on those bases, the motion then states:
"Petitioner
hereby gives formal notice to the Court of Petitioner's status as

a nonjuristic person, a Texas state Citizen, and that,
in such
status, Petitioner squarely challenges and voids the jurisdiction

of this Court."
Petitioners claimed in the motion that we lack
"in personam" jurisdiction and subject matter jurisdiction.
We
denied the motion.

Motions To Dismiss
On November 23, 2001, Dr. Trowbridge submitted (and Ms.
Martin signed "in full agreement") a motion styled "Petitioner's
Notice of Withdrawal of Petition", which we filed in each case as
14-20333.161
- 13 a motion to dismiss (the motions to dismiss) and denied. 3
In
those motions, petitioners reiterated their claims that we lack

jurisdiction and stated that they wished to withdraw their
petitions:
"Petitioner hereby gives Notice of WITHDRAWAL of the
petition for review by the United States Tax Court.
This Notice
of Withdrawal of petition makes moot, voids, and cancels all

proceedings previously scheduled by this Court for action upon
the petition filed in error."
Trial Session
These cases were called from the calendar at the Court's
trial session commencing on Monday, December 3, 2001, in Houston,
Texas.
On Friday, November 30, 2001, an employee of the Court
Clerk's Office contacted petitioners and reminded them that they

were expected to appear at the call of the calendar on Monday,
December 3.
When, on that date, the cases were called from the
calendar, petitioners failed to appear.
Counsel for respondent
appeared and announced ready for trial.
The Court set the cases
for trial on Tuesday, December 4, 2001, at 9:00 a.m., and

directed the deputy trial clerk to contact petitioners by
telephone and notify them of the date and time of the trial.
When the cases were recalled from the calendar on December 4,
for
3
To the extent petitioners were relying on grounds other
than jurisdiction, a decision dismissing the proceedings would
have been considered a decision sustaining the deficiencies
determined by respondent.
See sec. 7459(d). Since we did not
believe that was the result petitioners intended, we denied the
motions to dismiss.
14-20333.162
- 14 trial, petitioners failed to appear.
appeared and announced ready for trial.
The deputy trial clerk
reported that he had left messages for both petitioners as to the

date and time of the trial.
Respondent moved to dismiss for
default in both cases and the Court set those motions for a
hearing on Friday, December 7, 2001.
The Court instructed
respondent's counsel to arrange personal service of the

petitioners, to inform them of the hearing.
The Court heard one
witness in support of respondent's case.

On Friday, December 7, 2001, the cases were recalled from
the calendar for a hearing on respondent's motions to dismiss for
default.
Petitioners failed to appear.
appeared and announced ready for the hearing.
Internal Revenue
Agent Marilyn Maciness testified that she had served each

petitioner personally with notice of the hearing.
The Court took
respondent's motions to dismiss for default under advisement.
OPINION
I.
Motions To Dismiss for Default

Respondent has moved (1) that Dr. Trowbridge be held in
default with respect to, and that a decision be entered in

respondent's favor in the full amount of, the deficiencies in tax
determined by respondent against Dr. Trowbridge for the years
1991 through 1995 and the additions to tax determined by
14-20333.163
- 15 respondent against Dr. Trowbridge for the years 1991 through

1993, and (2)
that Ms. Martin be held in default with respect to,
and that a decision be entered in respondent's favor in the full

amount of, the deficiencies in tax determined by respondent
against Ms. Martin for the years 1991 through 1995.
object, respectively, to those motions
Petitioners
(collectively, the default
motions) . 4
In pertinent part, Rule 123(a) provides:
(a) Default:
If any party has failed to plead or
otherwise proceed as provided by these Rules or as
required by the Court, then such party may be held in
default by the Court either on motion of another party
or on the initiative of the Court.
Thereafter, the
Court may enter a decision against the defaulting
party, upon such terms and conditions as the Court may
deem proper * * *
Respondent argues that petitioners' failures to appear for
the call of these cases on December 3, 2001, and at the trial of
the cases on December 4, 2001, constitute defaults and that it is
appropriate for the Court to enter default judgments against each
with respect to the deficiencies and additions to tax that are
the subject of the default motions.
Although petitioners failed to appear at the hearing on

the default motions, they did submit a document to the Court that
day styled "Mandatory Judicial Notice of Petitioner's Refusal for
Cause of Respondent's Motion for Default Judgment", which we
filed in each case as an objection to the respective default
motions.
14-20333.164
- 16 Petitioners object to the default motions principally on the

ground that each had withdrawn his or her petition (by the
motions to dismiss, which we had denied).
We have no doubt that petitioners had knowledge of the call
of these cases on December 3, 2001, and the recall of the cases
on December 4 and 7, 2001.
We assume that petitioners failed to
answer those calls because they no longer wished to continue

their cases in this Court; that is the position taken by them in
the motions to dismiss
(which we denied) .
hold each of them in default.
We shall, therefore,
We shall enter a decision against
each petitioner that includes the full amount of the deficiencies

in tax and additions to tax that are the subject of the default
motions.
That is appropriate since respondent had denied all
material allegations of fact set forth in the petitions in

support of the assignments of error and none of petitioners'
filings has otherwise convinced us that respondent in any way
erred in determining the deficiencies in tax and additions to tax
that are the subject of the default motions.
II.
Remaining Additions to Tax

A.
Introduction
Respondent proceeded to trial on the issues of the additions

to tax determined against Dr. Trowbridge for the years 1994 and
1995 and the additions to tax determined against Ms. Martin for
the years 1991 through 1995 (collectively,
the remaining
14-20333.165
- 17 additions to tax) on account of the burden of production imposed

on the Secretary by current section 7491(c)
7491(c) . 5
(hereafter section
As will be discussed, respondent has carried that
burden.
B.
Summary Adjudication Unnecessary
Respondent has moved for partial summary judgment in his

favor with respect to the remaining additions to tax.
Petitioners object, respectively, to those motions
(collectively,
the summary judgment motions) .

A party may move for "summary adjudication in the moving
party's favor upon all or any part of the legal issues in
controversy."
Rule 121(a).
"Summary judgment is a device used
to expedite litigation and is intended to avoid unnecessary and

expensive trials of 'phantom factual questions.'"
Commissioner, 78 T.C. 412, 416 (1982).
Espinoza v.
"The party moving for
summary judgment has the burden of showing the absence of a

genuine issue as to any material fact."
Id.; see Rule 121(b)
"The opposing party is to be afforded the benefit of all

reasonable doubt, and any inference to be drawn from the
underlying facts contained in the record must be viewed in a
light most favorable to the party opposing the motion for summary
judgment."
Espinoza v. Commissioner, supra at 416.
We do not decide whether respondent was reguired to

satisfy sec. 7491(c) in this default setting.
14-20333.166
- 18 Respondent has moved for partial summary judgments, but,

since there was a trial in these cases, at which respondent
presented evidence pertaining to the remaining additions to tax,
we need not determine whether the summary judgment motions
satisfy the standards for summary adjudication.
therefore, deny the summary judgment motions
We shall,
(although we largely
sustain respondent's substantive positions therein, as discussed

below).
C.
Substantive Provisions
1.
Section 6651 (a) ( 1)
Section 6651(a) (1) provides for an addition to tax in the

event a taxpayer fails to file a timely return (determined
with regard to any extension of time for filing), unless it is
shown that such failure is due to reasonable cause and not due
to willful neglect.
The amount of the addition is equal to
5 percent of the amount required to be shown as tax on such

return foi each month or fraction thereof during which such
failure continues, up to a maximum addition of 25 percent for
returns more than 4 months delinquent.
For these purposes, the
amount required to be shown as tax on the return is reduced by

any timely payments of the tax 6 and any credits which may be
claimed on the return.
Sec. 6651 (b) (1)
In general, payment of income tax is due on the due date

of the corresponding return, determined without regard to any
filing extensions.
Sec. 6151(a).
14-20333.167
- 19 2.
Section 6654
Section 6654 provides for an addition to tax in the event of

an underpayment of a required installment of individual estimated
tax.
As relevant to these cases, each required installment of
estimated tax is equal to 25 percent of the "required annual

payment", which in turn is equal to the lesser of (1)
90 percent
of the tax shown on the individual's return for that year (or, if
no return is filed,
or (2)
90 percent of his or her tax for such year),
if the individual filed a return for the immediately
preceding taxable year, 100 percent of the tax shown on that

return.
Sec. 6654 (d) (1) (B) (i) and (ii).
The due dates of the
required installments for a calendar taxable year are April 15,

June 15, and September 15 of that year and January 15 of the
following year.
Sec. 6654 (c) (2).
For purposes of section 6654,
an individual's tax consists of income tax and self-employment

tax and is determined before the application of any wage
withholding credit 7 (but after the application of other allowable
credits) .
Sec. 6654(f); see sec. 31.
There are two mechanical exceptions to the applicability of

the section 6654 addition to tax.
First, as relevant to these
cases, the addition is not applicable if the tax shown on the

individual's return for the year in question (or, if no return is
filed, the individual's tax for that year),
reduced for these
Under sec. 6654 (g) (1), wage withholding credits are

treated as payments of estimated tax.
14-20333.168
- 20 purposes by any allowable credit for wage withholding, is less

than $500. 8
Sec. 6654 (e) (1).
Second, the addition is not
applicable if the individual's tax for the preceding taxable year

was zero.
D.
Sec. 6654 (e) (2)

Section 7491(c)
Section 7491(c) imposes the burden of production in any

court proceeding (i.e., the burden of moving forward with
evidence) on the Commissioner with respect to the liability of
any individual for penalties and additions to tax.
In order to
meet the burden of production under section 7491(c), the

Commissioner need only make a prima facie case that imposition of
the penalty or addition to tax is appropriate; he need not negate
the existence of any circumstantial defense such as reasonable
cause.
Higbee v. Commissioner, 116 T.C. 438, 446 (2001); H.
Con. Rept. 105-599, at 241 (1998), 1998-3 C.B. 747,
995.
Furthermore, section 7491(c) has no effect on the burden of proof

(i.e., the burden of persuasion), Higbee v. Commissioner, supra
at 446-447, which remains on petitioners in these cases, Rule
Effective for taxable years beginning after Dec. 31,

1997, the threshold amount is $1,000. Taxpayer Relief Act of
1997, Pub. L. 105-34, sec. 1202(a), 111 Stat. 994.
Sec. 7491(c) applies to court proceedings arising in
connection with examinations commencing after July 22, 1998.
Internal Revenue Service Restructuring and Reform Act of 1998,
Pub. L. 105-206, sec. 3001 (c) (1), 112 Stat. 727. As referenced
in our findings of fact, the additions to tax not included in the
default motions (collectively, the remaining additions to tax)
pertain to examinations commenced after July 1998.
14-20333.169
- 21 142 (a); cf. current sec. 7491 (a)
(shifting the burden of proof to
the Commissioner in certain circumstances).

E.
Discussion
1.
Petitioners' Forms 1040 and 1040EZ
Respondent contends that the Forms 1040 and 1040EZ filed by

petitioners with respect to the years at issue do not constitute
valid returns.
10
In Williams v. Commissioner, 114 T.C. 136, 143
(2000), we held that a disclaimer statement similar to the ones

at issue in these cases rendered the Form 1040 to which it was
attached invalid.
of that case here.
We see no reason to depart from the reasoning

Accordingly, we conclude that Dr.
Trowbridge's 1993-95 Forms 1040, and Ms. Martin's 1991-92 Forms

1040 and 1995 Form 1040EZ, are not valid returns.
2.
Respondent's Section 6651 (a) (1) Determinations
As relevant to his section 6651 (a) (1) determinations,

respondent produced evidence that petitioners did not file valid
Federal income tax returns for any of the years at issue.
Respondent also produced evidence that neither petitioner made
any timely payments of tax with respect to the years at issue.u
10
We address that contention separately because it is

relevant to our analysis of both the sec. 6651(a) (1) and the sec.
6654 additions to tax asserted by respondent.
11
In his sec. 6651 (a) (1) computations, respondent properly

credited each petitioner with one-half of petitioners' aggregate
wage withholding credit where applicable.
See sec. 6651(b) (1);
sec. 1. 31-1 (a), Income Tax Regs. (rule for wage withholding
credits of separately filing spouses domiciled in a community
(continued ... )
14-20333.170
- 22 Based on the foregoing, we conclude that respondent

established a prima facie case that the determination of 25percent additions to tax under section 6651(a) (1) with respect to
Dr. Trowbridge for the years 1994 and 1995, and with respect to
Ms. Martin for the years 1991-95, is appropriate, thereby
satisfying section 7491(c).
In the absence of any evidence
refuting that prima facie case (such as reasonable cause or lack

of willful neglect on the part of either petitioner), we conclude
that petitioners are liable for such additions to tax.
Except as
noted below, 12 we also accept respondent's computation of the

amounts of those additions as set forth in the notices of
deficiency.
3.
Respondent's Section 6654 Determinations
As relevant to his section 6654 determinations, respondent

introduced into evidence Dr. Trowbridge's invalid return for 1993
in addition to the evidence of invalid and nonexistent returns
discussed above in the context of his section 6651(a) (1)
determinations.
Respondent also produced evidence that, aside
11
( continued)
property State).
Respondent also properly credited Ms. Martin
with her earned income credit for 1995. See sec. 6651(b) (1).
12
Respondent inexplicably based his 1992 sec. 6651(a) (1)

computation for Ms. Martin on tax of $8,764 rather than the
$8,740 amount of tax that appears elsewhere in the notice of
deficiency issued to her.
The correct amount of such addition
shall be the subject of a Rule 155 computation.
14-20333.171
- 23 from amounts withheld from wages,
13
neither petitioner made any
timely payments of tax that could be applied against his or her

required annual payments for the years at issue.
In the absence of valid returns, the applicability of the
$500 de minimis exception to the section 6654 addition to tax
discussed above is determined on the basis of each petitioner's
tax (within the meaning of section 6654(f))
issue.
See sec. 6 654 (e) ( 1) .
for the years at
In light of the deficiency
decisions that we shall enter against petitioners pursuant to our

disposition herein of the default motions, neither petitioner
qualifies for the $500 de minimis exception for any of the years
at issue.
The impending entry of those deficiency decisions also
precludes the applicability of the section 6654(e) (2) exception

(zero tax for preceding year) with respect to any of the years at
issue.
Based on the foregoing, we conclude that respondent
established a prima facie case that the determination of
additions to tax under section 6654 with respect to Dr.
Trowbridge for the years 1994 and 1995, and with respect to Ms.
Martin for the years 1992-95, is appropriate, thereby satisfying
section 7491(c).
Absent any evidence refuting that prima facie
13
As is the case with his sec. 6651 (a) (1) computations,

respondent properly credited each petitioner with one-half of
petitioners' aggregate wage withholding credit where applicable.
See sec. 6654(g) (1), supra note 7; sec. 1.31-1(a), Income Tax
Regs., supra note 11.
14-20333.172
- 24 case, we conclude that petitioners are liable for such additions

to tax.
Except as noted below,
14
we also accept respondent's
computation of the amounts of those additions as set forth in the

notices of deficiency.
III.
Section 6673(a) (1)
Penalties
Respondent asks that we impose a penalty against each

petitioner under section 6673 (a) (1)
in the amount of $25,000.
In pertinent part, section 6673 (a) (1) provides:

SEC. 6673.
(a)
SANCTIONS AND COSTS AWARDED BY COURTS.
Tax Court Proceedings.--
(1) Procedures instituted primarily for

delay, etc.--Whenever it appears to the Tax
Court that-(A) proceedings before it have been
instituted or maintained by the taxpayer
primarily for delay,
(B) the taxpayer's position in such
proceeding is frivolous or groundless,
or
the Tax Court, in its decision, may require the

taxpayer to pay to the United States a penalty not in
excess of $25,000.
14
Respondent inexplicably based his 1992 sec. 6654

computation for Ms. Martin on tax of $8,764 rather than the
$8,740 amount of tax that appears elsewhere in the notice of
deficiency issued to her.
In his 1995 sec. 6654 computation for
Ms. Martin, rather than reducing her 1995 tax by the amount of
her 1995 earned income credit, respondent improperly treated that
credit as a payment of estimated tax.
See sec. 6654 (f) (3) and
(g) (1) .
The correct amounts of those additions to tax shall be
the subject of Rule 155 computations.
14-20333.173
- 25 The purpose of section 6673 "is to compel taxpayers to think

and to conform their conduct to settled principles before they
file returns and litigate."
68, 71
Coleman v. Commissioner, 791 F.2d
(7th Cir. 1986); see also Grasselli v. Commissioner, T.C.
Memo. 1994-581 (quoting Coleman).
A taxpayer's position is
frivolous if it is contrary to established law and unsupported by

a reasoned, colorable argument for change in the law.
Family Trust v. Commissioner, 115 T.C. 523, 544
E.g., Nis
(2000)
We need
not find specific damages to invoke section 6673(a) (1); rather,

that section is a penalty provision, intended to deter and
penalize frivolous claims and positions in deficiency
proceedings.
Bagby v. Commissioner, 102 T.C. 596, 613-614
(1994).
Petitioners do not here argue for any change in the law, and
there is no plausible argument that, as maintained in the
disclaimers attached to their Forms 1040 and 1040EZ, the payment
of income taxes is voluntary.
T.C. 88,
90
(1988).
E.g., Woods v. Commissioner, 91
Similarly, there is no plausible argument
that, as maintained in the petitions, subjecting petitioners to

the same rate of tax that applies to Federal employees
constitutes impermissible disparate treatment.
See Rogers v.
Commissioner, T.C. Memo. 2001-20, affd. without published opinion

281 F.3d 1278
(5th Cir. 2001).
Whatever legitimate arguments may
underlie their assignments of error, petitioners have emphasized
14-20333.174
- 26 -
frivolous arguments and, for that reason alone, deserve to have

section 6673(a) (1) penalties imposed against them.
We are also convinced by petitioners' conduct that they both
instituted and maintained these proceedings for delay, which is a
separate basis for imposing a section 6673(a) (1) penalty.
We
struck all but minimal portions of their 74- and 75-page

petitions.
Their discovery requests ran to hundreds of pages,
and we granted respondent's motions for protective orders with

respect thereto, in part on the ground that we agreed with
respondent that the discovery was intended to burden respondent
unduly, waste his resources, and divert him from trial
preparation.
Petitioners actively, indeed,
forcefully,
prosecuted these cases until 2 weeks before trial.
At that
point, they attempted to withdraw their petitions, asserting a

jurisdictional challenge premised on their disavowal of any
commercial relationship with, and any enjoyment of benefits from,
the United States.
They refused to appear for trial or for a
hearing on respondent's motions to dismiss for default, despite

notice thereof in both instances.
We interpret petitioners'
actions in prosecuting (and not prosecuting) these cases as

evidence of their intent to delay these proceedings.
There are
numerous years and, for some years, large dollar amounts involved
in these cases.
There is before us another case, involving Dr.
Trowbridge and his 1996 and 1997 tax years.
That case involves
14-20333.175
- 27 conduct similar to that in this case.

Commissioner, T.C. Memo. 2003-165.
See Trowbridge v.
We think that both
petitioners deserve large penalties under section 6673(a) (1).
It
is clear to us that Dr. Trowbridge took the lead in the

sanctionable activity here.
penalty of $25,000.
Therefore, we shall impose on him a
We shall impose on Ms. Martin, who filed her
own petition and submitted documents and took actions that

matched those submitted and taken by Dr. Trowbridge, a penalty of
$15,000.
To reflect the foregoing,
Appropriate orders will
be issued, and decisions will
be entered under Rule 155.
14-20333.176
T.C. Memo. 2003-165
UNITED STATES TAX COURT
JOHN P. TROWBRIDGE, LIFE CENTER HOUSTON BUSINESS TRUST,

JOHN P. TROWBRIDGE, TRUSTEE, AND LIFE CHOICES BUSINESS TRUST,
JOHN P. TROWBRIDGE, TRUSTEE, Petitioners y.
Filed June 4, 2003.
Docket No. 750-01.
R determined deficiencies in, and additions

to, tax with respect to P John P. Trowbridge
(Dr. Trowbridge) for 1996 and 1997. As a protective
measure, R also determined deficiencies in, and
additions to, tax with respect to P Life Center Houston
Business Trust (Life Center) for 1996 and 1997 and P
Life Choices Business Trust (Life Choices) for 1997.
Ps filed a petition for redetermination but failed to
appear at trial.
R moved for default judgment against
Dr. Trowbridge with respect to deficiencies in tax for
1996 and 1997 in the amounts of $146,847 and $211,508,
respectively.
R proceeded to trial on the issues of
(1) an additional deficiency in tax (first raised in
R's amendment to answer) with respect to Dr. Trowbridge
for 1996 based on additional gross business receipts
for that year, and (2) the additions to tax asserted
against Dr. Trowbridge for 1996 and 1997.
Government
Exhibit
C-2
_____________
14-20333.177
- 2 1.
Held:
granted.
R's motion for default judgment is
2.
Held, further, R is not barred by the statute
of limitations on assessment with respect to Dr.
Trowbridge's 1996 taxable year.
3.
Held, further, there is an additional
deficiency in tax with respect to Dr. Trowbridge for
1996 based on gross business receipts of $1,632,140 for
that year.
4.
Held, further, Dr. Trowbridge is liable for
additions to tax under sees. 6 651 (a) ( 1) and 6 654,
I.R.C., with respect to his 1996 and 1997 taxable
years.
5.
Held, further, Dr. Trowbridge is liable for a
penalty under sec. 6673, I.R.C., in the amount of
$25,000.
John Parks Trowbridge, pro se.

M. Kathryn Bellis, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION

HALPERN, Judge:
2000
By notice of deficiency dated October 20,
(the notice of deficiency), respondent determined
deficiencies in, and additions to, Federal income tax with

respect to petitioner John P. Trowbridge (Dr. Trowbridge) as
follows:
Respondent also asserted additions to tax under sec.

6651 (a) (2) in amounts to be determined.
We interpret
respondent's posttrial brief as conceding those additions to tax
in the event we find that the 1996 and 1997 Forms 1040 received
(continued ... )
14-20333.178
- 3 -
Year
1996
1997
Deficiency
$146,847
272,771
Additions to
Sec. 6651 (a) (1)
$33,041
61,373
$7,816
14,593
In a statement attached to the notice of deficiency, respondent

explained that business income purportedly earned by petitioner
Life Center Houston Business Trust (Life Center) in 1996 and 1997
and by petitioner Life Choices Business Trust (Life Choices)
in
1997 is taxable to Dr. Trowbridge on the alternative grounds that

( 1) Life Center and Life Choices were shams,
(2) Life Center and
Life Choices were grantor trusts of which Dr. Trowbridge was the
owner, or (3)
Dr. Trowbridge in fact earned such income and,
under the assignment of income doctrine, could not shift the

incidence of taxation with respect to such amounts.
Solely as a
protective measure (i.e., as an alternative position in the event

the foregoing arguments proved to be unsuccessful), respondent
also determined deficiencies in, and additions to, tax with
respect to Life Center for 1996 and 1997 and Life Choices for
1997 and issued notices of deficiency (also dated October 20,
2000) to that effect. 2
Petitioners timely filed a petition for
redetermination.
( continued)
by respondent from Dr. Trowbridge in October 1997 and October
1998, respectively, are not valid income tax returns (which we so
find).
Because we do not reach respondent's alternative

position, we do not set forth the deficiencies and additions to
tax determined against Life Center and Life Choices.
14-20333.179
- 4 Respondent has moved that Dr. Trowbridge be held in default

and that a decision be entered that there are deficiencies in tax
with respect to him for 1996 and 1997 in the amounts of $146,847
and $211,508,
respectively, and that decisions be entered that
there are no deficiencies in tax with respect to Life Center and

Life Choices.
Respondent has also moved for partial summary
judgment in his favor on the issues of (1) whether respondent is

barred by the statute of limitations on assessment with respect
to Dr. Trowbridge's 19 96 taxable year,
( 2) whether there is an
additional deficiency in tax with respect to Dr. Trowbridge for

1996 based on additional gross business receipts for that year,
and (3) whether Dr. Trowbridge is liable for additions to tax
under sections 6651 (a) ( 1) and 6654.
For the reasons that follow,
we shall grant respondent's motion for default judgment and

sustain (with minor modifications as to amounts) the positions he
has taken in his motion for partial summary judgment.
We shall
also impose a penalty on Dr. Trowbridge under section 6673(a) (1)

Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the years at issue, and
all Rule references are to the Tax Court Rules of Practice and
That amount is less than the deficiency in tax for 1997

determined by respondent in the notice of deficiency.
In his
motion for default judgment, respondent attributes such downward
adjustment to the elimination of transfers among petitioners and
other duplicated items.
14-20333.180
- 5 -
Procedure.
For the sake of convenience, all dollar amounts are
rounded to the nearest dollar.

FINDINGS OF FACT
Dr. Trowbridge and Life Center
Dr. Trowbridge is a physician who has been practicing
medicine since at least 1978.
At the time the petition was filed
in this case, Dr. Trowbridge resided in Harris County, Texas.

Dr. Trowbridge is a calendar year taxpayer.
Life Center is a business trust 4 created by Dr. Trowbridge
and a colleague on or around December 6, 1996, pursuant to a
document styled "Contract and Declaration of Trust for Life
Center Houston"
(the trust agreement) .
The trust agreement
purports to effect the transfer by Dr. Trowbridge of unspecified

property to Life Center in exchange for trust certificates
evidencing beneficial ownership of Life Center.
Although the
trust agreement does not identify any trustees by name, Dr.

Trowbridge held himself out as the trustee of Life Center.
Before the close of 1996, Dr. Trowbridge obtained an employer
identification number for Life Center and opened a bank account
in Life Center's name (the Life Center bank account).
For purposes of this report, we assume (without deciding)

that Life Center is a legally recognized entity under Texas law.
14-20333.181
- 6 The Medical Practice

During the years at issue, Dr. Trowbridge provided medical
services at 9816 Memorial Blvd., Suite 205, Humble, Texas
medical practice) .
(the
The books and records of the medical practice
were maintained under the cash method of accounting.
Prior to
December 1996, the medical practice was referred to as "John

Parks Trowbridge MD", and receipts from the medical practice were
deposited in two bank accounts styled "John Parks Trowbridge MD".
Contemporaneous with the formation of Life Center in December
1996, Dr. Trowbridge began using the name "Life Center Houston"
for the medical practice.
On January 8, 1997, cash receipts and
checks from the medical practice for the period December 3

through December 31, 1996, were deposited in the Life Center bank
account.
Dr. Trowbridge's 1995 Through 1997 Forms 1040
1995 Form 1040 5
Some time in January 1997, the Internal Revenue
Service (IRS)
received from Dr. Trowbridge a Form 1040, U.S.
Individual Income Tax Return 1995 (1995 Form 1040).
Although
Dr. Trowbridge reported tax of $133,977 on that form, he also

inserted the following handwritten notation thereon:
"SEE
ATTACHED DISCLAIMER STATEMENT--ADMITTED TAX LIABILITY IS ZERO".
As discussed infra, Dr. Trowbridge's 1995 Form 1040 is

relevant to the determination of whether he is liable for the
sec. 6654 addition to tax with respect to his 1996 taxable year.
14-20333.182
- 7 -
The attached disclaimer statement (the 1995 disclaimer)
reads in
part as follows:
* * * I respectfully decline to volunteer concerning
assessment and payment of any tax balance due on the
return or any redetermination of said tax.
Be it known
that I, therefore, deny tax liability and do not admit
that the stated amount of tax on return, as calculated
solely by reference to provided tables, is due and
collectible. The tax return read as a whole shows no
amount as being the tax and shows the tax to be zero
and zero is the startinq point in determining a
deficiency or any other action involving me.
* * *
Initial 1996 Form 1040
Dr. Trowbridge received extensions of time to file his 1996
Federal income tax return to October 15, 1997.
On that date,
Dr. Trowbridge mailed to the IRS a Form 1040, U.S. Individual

Income Tax Return 1996 (initial 1996 Form 1040), which the IRS
received on October 20, 1997.
Although Dr. Trowbridge reported
tax of $36,851 on that form, he also attached a disclaimer

statement substantially identical to the 1995 disclaimer.
Dr. Trowbridge also deleted the words "of perjury" from the jurat
of his initial 1996 Form 1040. 6
1996 Form 1040X and Revised 1996 Form 1040
On January 28, 2000, the IRS received from Dr. Trowbridge a
Form 1040X, Amended Individual Income Tax Return, for 1996 (1996
The jurat is the statement above the signature line on

the return which reads in relevant part:
"Under penalties of
perjury, I declare that I have examined this return and
accompanying schedules and statements, and to the best of my
knowledge and belief, they are true, correct, and complete."
14-20333.183
- 8 -
Form 1040X), reporting additional tax of $4,071.
Attached as an
exhibit to the 1996 Form 1040X is a Form 1040 for 1996 signed by
Dr. Trowbridge and dated January 26, 2000
1040).
(revised 1996 Form
In terms of computations, the revised 1996 Form 1040 is
substantially identical to the initial 1996 Form 1040 (i.e., it

does not reflect the changes contained in the 1996 Form 1040X).
However, Dr. Trowbridge did not attach a disclaimer statement to
the revised 1996 Form 1040, nor did he alter the jurat thereof.
The words "under protest/without prejudice" appear directly
beneath Dr. Trowbridge's signature on both the 1996 Form 1040X
and the revised 1996 Form 1040.
Initial 1997 Form 1040
Dr. Trowbridge received an extension of time to file
his 1997 Federal income tax return to August 15, 1998.
On
October 22, 1998, the IRS received from Dr. Trowbridge a Form
1040, U.S. Individual Income Tax Return 1997 (initial 1997 Form
1040).
Although Dr. Trowbridge reported tax of $44,763 on that
form, he also wrote the following on page 2 thereof:
"SEE
ATTACHED DISCLAIMER--ADMITTED TAX LIABILITY IS ZERO PER ATTACHED

STATEMENT".
In substance, the attached disclaimer statement is
Dr. Trowbridge also deleted
the word "perjury" from the jurat of his initial 1997 Form 1040.
14-20333.184
- 9 1997 Form 1040X and Revised 1997 Form 1040

On January 28, 2000, the IRS received from Dr. Trowbridge a
Form 1040X, Amended Individual Income Tax Return, for 1997
Form 1040X), reporting additional tax of $32,180.
(1997
Attached as an
exhibit to the 1997 Form 1040X is a Form 1040 for 1997 signed by
Dr. Trowbridge and dated January 26, 2000
1040) .
(revised 1997 Form
In terms of computations, the revised 1997 Form 1040 is
substantially identical to the initial 1997 Form 1040 (i.e., it

does not reflect the changes contained in the 1997 Form 1040X).
However, Dr. Trowbridge did not attach a disclaimer statement to
the revised 1997 Form 1040, nor did he alter the jurat thereof.
The words "under protest/without prejudice" appear directly
beneath Dr. Trowbridge's signature on both the 1997 Form 1040X
and the revised 1997 Form 1040.
Dr. Trowbridge's Payments and Credits
The only payments made by Dr. Trowbridge in respect of his
1996 income tax were $100 payments submitted with his initial
1996 Form 1040 in October 1997 and his 1996 Form 1040X in January
2000, respectively.
The only payments made by Dr. Trowbridge in
respect of his 1997 income tax were $100 payments submitted with
his initial 1997 Form 1040 in October 1998 and his 1997 Form
1040X in January 2000, respectively.
Dr. Trowbridge did not
claim any wage withholding or other credits on his 1996 and 1997
Forms 1040 and 1040X.
14-20333.185
- 10 The Pleadings
The Petition
Petitioners filed a petition for redetermination on
January 16, 2001.
We have struck from the petition all
assignments of error other than petitioners' assignment relying

on the affirmative defense that the period for assessment of
taxes for 1996 has expired (petitioners' limitations defense)
Answer and Amendment to Answer
Respondent answered petitioners' one remaining assignment of
error by denying that he had erred and averring that, because Dr.
Trowbridge's initial 1996 Form 1040 is not a valid return, the
statute of limitations does not bar the assessment of tax with
respect to Dr. Trowbridge for that year. 7
Subsequently, we granted respondent leave to amend his
answer to allege an increased deficiency in Dr. Trowbridge's 1996
tax attributable to increased gross business receipts for that
year (the portion of Dr. Trowbridge's 1996 deficiency in excess
of $146,847 is hereafter referred to as the additional 1996
deficiency) .
Respondent also asserted corresponding increases in
the additions to tax asserted against Dr. Trowbridge under

sections 6651(a) (1) and 6654.
Consistent with the protective
notice of deficiency issued to Life Center, respondent asserted
Respondent also alleged that he issued his notice of

deficiency to Life Center within the 3-year period of limitations
on assessment applicable to Life Center's 1996 taxable year.
14-20333.186
- 11
in the alternative an increased deficiency in, and increased
additions to, Life Center's 1996 tax.
Petitioners did not file a
reply to respondent's amendment to answer.

Petitioners' Discovery Requests
On September 27 and 28, 2001, petitioners served on
respondent a request for admissions, a set of interrogatories,
and two requests for production of documents.
The request for
admissions is 134 pages in length (without attachments) and

requests 545 admissions.
The set of interrogatories is 124 pages
in length and contains 480 interrogatories.

On October 5, 2001, respondent filed a motion for protective
order with respect to the request for admissions,
interrogatories, and requests for production of documents served
by petitioners.
Respondent argued that such requests were not
timely, addressed improper issues, and were intended to burden

respondent unduly, waste his resources, and divert him from trial
preparation.
We asked petitioners to respond and, after
considering their response, granted respondent relief

"substantially for the reasons stated in respondent's motion."
Petitioners' Dismissal Efforts
Motion To Dismiss for Lack of Jurisdiction
On November 21, 2001, petitioners submitted a motion styled
"Petitioner's Verified Challenge to Jurisdiction of the Court",
which we filed as a motion to dismiss for lack of jurisdiction.
14-20333.187
- 12 The motion "denies the existence of any contracts or commercial

agreements which create an attachment of an equity relationship
between the 'United States' and/or The State of Texas and
Petitioner."
The motion also states:
"Petitioner has
specifically forfeited, waived, rejected, declined, and refused

to voluntarily accept any and all benefits, especially admiralty
and limited debt liability benefits, from the 'United States' and
its instrumentalities."
then states:
Apparently on those bases, the motion
"Petitioner hereby gives formal notice to the Court
of Petitioner's status as a nonjuristic person, a Texas state

Citizen, and that,
in such status, Petitioner squarely challenges
and voids the jurisdiction of this Court."
Petitioners claimed
in the motion that we lack "in personam" jurisdiction and subject

matter jurisdiction.
We denied the motion.
Motion To Dismiss
On November 23, 2001, petitioners submitted a motion styled
"Petitioner's Notice of Withdrawal of Petition", which we filed
as a motion to dismiss
(the motion to dismiss) and denied. 8
In
that motion, petitioners reiterated their claim that we lack

jurisdiction and stated that they wished to withdraw their
To the extent petitioners were relying on grounds other

than jurisdiction, a decision dismissing the proceedings would
have been considered a decision sustaining the deficiencies
determined by respondent.
See sec. 7459(d).
Since we did not
believe that was the result petitioners intended, we denied the
motion to dismiss.
14-20333.188
- 13 petition:
"Petitioner hereby gives Notice of WITHDRAWAL of the
petition for review by the United States Tax Court.
This Notice
of Withdrawal of petition makes moot, voids, and cancels all

proceedings previously scheduled by this Court for action upon
the petition filed in error."
Trial Session
This case was set for trial at the Court's trial session
commencing December 3, 2001, in Houston, Texas (the trial
session) .
On Friday, November 30, 2001, an employee of the Court
Clerk's Office contacted Dr. Trowbridge and reminded him that
petitioners were expected to appear on the following Monday
at the call of the calendar at the trial session.
When, on
December 3, 2001, the case was called from the calendar,

petitioners failed to appear.
and announced ready for trial.
Counsel for respondent appeared

The Court set the case for trial
on the following day (December 4).

When the case was recalled from the calendar for trial on
December 4, 2001, petitioners failed to appear.
Counsel for
respondent appeared and announced ready for trial.
The deputy
trial clerk reported that he had left two messages for Dr.
Trowbridge at his office regarding the date and time of the
trial.
Counsel for respondent orally moved for default judgment
with respect to the initial deficiencies in tax determined
14-20333.189
- 14 against Dr. Trowbridge, which we took under advisement pending

respondent's filing of a
default
(subsequently filed) written motion for
(the default motion).
Respondent proceeded to trial on
the remaining amounts at issue
(i.e., the additional 1996
deficiency and the additions to tax) . 9

OPINION
I.
The Default Motion

By the default motion, respondent moves that Dr. Trowbridge
be held in default and that a decision be entered that there are

deficiencies in tax with respect to him for 1996 and 1997 in the
amounts of $146,847
(the initial 1996 deficiency) and $211,508
(the 1997 deficiency), respectively, and that a decision be

entered that there are no deficiencies in tax with respect to
Life Center and Life Choices.
Respondent moves in the
alternative that Life Center be held in default and that a

decision be entered that there are deficiencies in tax with
respect to Life Center for 1996 and 1997 in the amounts of
$23,195 and $476,918, respectively, and that Life Choices be held
Respondent bears the burden of proof (i.e., the ultimate

burden of persuasion) with respect to the additional 1996
deficiency and the portions of the asserted additions to tax
attributable thereto.
See Rule 142(a). Respondent bears the
burden of production (i.e., the burden of moving forward with
evidence) with respect to the additions to tax asserted against
Dr. Trowbridge in their entirety.
See current sec. 7491(c).
Since respondent decided to proceed to trial on those issues to
satisfy his evidentiary burdens, we need not decide whether he
was required to do so in this default setting.
14-20333.190
- 15 in default and that a decision be entered that there is a

deficiency in tax with respect to Life Choices for 1997 in the
amount of $500,028.
Although the Court ordered petitioners to
file a response to the default motion, Dr. Trowbridge returned to

the Court a copy of that order with the following language
handwritten thereon:
"Timely Notice of Non-Acceptance[.] The
Petition was Withdrawn".

In pertinent part, Rule 123(a) provides:
(a) Default:
If any party has failed to plead or
otherwise proceed as provided by these Rules or as
required by the Court, then such party may be held in
default by the Court either on motion of another party
or on the initiative of the Court.
Thereafter, the
Court may enter a decision against the defaulting
party, upon such terms and conditions as the Court may
deem proper * * *
We have no doubt that petitioners had knowledge of the call of
this case on December 3, 2001, and the recall of the case on the
following day.
We assume that petitioners failed to answer those
calls because they no longer wished to continue their case in

this Court; that is the position they took in their motion to
dismiss
(which we previously denied) .
We therefore grant the
default motion and, in accordance with respondent's primary

position therein, hold Dr. Trowbridge in default. 10
10
As discussed above, we struck from the petition all

assignments of error other than petitioners' limitations defense.
Since respondent addresses petitioners' limitations defense
(among other items) in his motion for partial summary judgment,
the principal consequence of our holding Dr. Trowbridge in
(continued ... )
14-20333.191
- 16 II.
Respondent's Motion for Partial Summary Judgment

Respondent has moved for partial summary judgment in his
favor
(the summary judgment motion) with respect to petitioners'
limitations defense, the existence and amount of the additional

1996 deficiency, 11 and the additions to tax asserted against Dr.
Trowbridge. 12
Summary judgment is a device used to expedite
litigation and is intended to avoid unnecessary and expensive

trials of "phantom factual questions."
78 T.C. 412, 416 (1982).
Espinoza v. Commissioner,
Since there was a trial in this case,
at which respondent presented evidence pertaining to the issues

addressed in the summary judgment motion, we need not determine
whether summary adjudication is appropriate here.
We shall,
therefore, deny the summary judgment motion (although we largely
10
( continued}
default is the ratification
Dr. Trowbridge, rather than
liable for any deficiencies
determined in the notice of
of respondent's primary position that

Life Center and Life Choices, is
in tax and additions to tax
deficiency.
In his amendment to answer, respondent alleges an

additional 1996 deficiency of $244,935, based on gross business
receipts of $1,649,376 for that year.
In his posttrial brief,
respondent asserts that Dr. Trowbridge had gross business
receipts of $1,632,423 in 1996, thus necessitating a Rule 155
computation with respect to the additional 1996 deficiency.
12
Respondent moved in the alternative for partial summary

judgment against Life Center and Life Choices in the event we
deny his request for default judgment against Dr. Trowbridge.
Our disposition of the default motion renders that alternative
position moot.
14-20333.192
- 17 sustain respondent's substantive positions therein, as discussed

below).
III.
Statute of Limitations
As a general matter, income tax (and related penalties and
additions to tax) must be assessed within 3 years after the later

of (1)
the due date (without regard to extensions) of the
corresponding return, or (2)

filed.
13
the date on which such return is
Sees. 6501(a) and (b) (1),
1(a), Proced. & Admin. Regs.
6665(a) (2); sec. 301.6501(b)-
However, if the taxpayer fails to
file a return, the Commissioner may assess such amounts at any

time.
Sec. 6501 (c) (3).

As relevant to petitioners' limitations defense, respondent
contends that Dr. Trowbridge's initial 1996 Form 1040 does not
constitute a valid return.
In Williams v. Commissioner, 114 T.C.
136, 143 (2000), we held that a disclaimer statement similar to

the ones at issue in this case rendered the Form 1040 to which it
was attached invalid.
We have also held that altering the Form
1040 jurat can destroy that form's validity as a return.

Jenkins v. Commissioner, T.C. Memo. 1989-617.
depart from the reasoning of those cases here.
E.g.,
We shall not
Accordingly, we
conclude that Dr. Trowbridge's initial 1996 Form 1040 is not a
13
For these purposes, the date on which a return is mailed

is treated as the filing date if the postmark date falls within
the prescribed period (including extensions) for filing the
return.
Sec. 7502 (a) (1) and (a) (2) (A) (i).
14-20333.193
- 18 valid return.
It follows that respondent is not barred by the
statute of limitations on assessment with respect to Dr.

Trowbridge's 1996 taxable year. 14
See, e.g., Jarvis v.
Commissioner, 78 T.C. 646, 655 (1982)

IV.
Additional 1996 Deficiency

In the notice of deficiency, respondent determined that the
medical practice generated gross receipts of $1,062,676 in 1996.

Respondent based that determination on an analysis of the deposit
activity with respect to the two bank accounts styled "John Parks
Trowbridge MD" and the Life Center bank account (collectively,
the medical practice bank accounts).
Respondent subsequently
received daily cash analysis reports and daily practice summaries

with respect to the medical practice for 1996 as the result of
the enforcement of a summons issued to Dr. Trowbridge.
Those
reports, introduced into evidence at trial, show that the medical

practice generated gross receipts of $1,632,140 in 1996. 15
14
Even if the revised 1996 Form 1040 that Dr. Trowbridge

submitted in January 2000 constitutes a valid return (an issue
respondent does not explicitly address and we do not decide),
respondent issued the notice of deficiency on Oct. 20, 2000, well
within the 3-year period of limitations on assessment for 1996
that would have commenced on the date of such filing.
See sees.
6503 (a), 6213 (a) (issuance of a valid notice of deficiency
suspends the running of the period of limitations on assessment
during the pendency of any ensuing proceedings originating in
this Court) .
15
We have adjusted respondent's computation of 1996

medical practice gross receipts ($1,632,423) downward by $283 to
reflect a patient refund recorded on the cash analysis report for
(continued ... )
14-20333.194
- 19 Respondent bolstered his documentary evidence with witness

testimony.
Kathryn Hill, a former employee of Dr. Trowbridge's,
testified that she had prepared the practice summaries each day
as part of her duties and that she had derived the month-to-date
and year-to-date collections listed thereon from the daily cash
analysis reports prepared by other personnel.
Ms. Hill further
testified that, as sometimes reflected in her handwritten

notations on the daily cash analysis reports, she had transferred
cash receipts directly to Dr. Trowbridge and had used patients'
checks to pay third party creditors of the medical practice
whenever Dr. Trowbridge so requested, rather than depositing such
amounts in any of the medical practice bank accounts.
Ms. Hill's
testimony is consistent with that of William Williams, an IRS

agent who testified that, in his review of the medical practice
bank account statements, he had been unable to find deposits
corresponding to numerous checks and cash receipts recorded in
the daily cash analysis reports.
Dr. Trowbridge's own daily records establish the gross
receipts of the medical practice in 1996, and the testimony of
Ms. Hill and Mr. Williams satisfactorily explains the large
discrepancy between that amount and the aggregate bank deposits
on which respondent based the initial 1996 deficiency.
15
( continued)
Oct. 28, 1996, that we believe respondent overlooked.
14-20333.195
- 20 Accordingly, we find that there is an additional deficiency in

tax with respect to Dr. Trowbridge for 1996 based on gross
business receipts of $1,632,140 for that year.
V.
Additions to Tax
A.
Statutory Provisions
1.
Section 6651(a)(l)
Section 6651 (a) (1) provides for an addition to tax in the

event a taxpayer fails to file a timely return (determined with
regard to any extension of time for filing), unless it is shown
that such failure is due to reasonable cause and not due to
willful neglect.
The amount of the addition is equal to 5
percent of the amount required to be shown as tax on the

delinquent return for each month or fraction thereof during
which the return remains delinquent, up to a maximum addition of
25 percent for returns more than 4 months delinquent.
For these
purposes, the amount required to be shown as tax on the return is

reduced by any timely payments of the tax 16 and any credits which
may be claimed on the return.
2.
Sec. 6651 (b) (1).
Section 6654
Section 6654 provides for an addition to tax (in the form of

an interest charge) in the event of an underpayment of a required
installment of individual estimated tax.
As relevant to this
16
In general, payment of income tax is due on the due date

of the corresponding return, determined without regard to any
filing extensions.
Sec. 6151(a).
14-20333.196
- 21 case, each required installment of estimated tax is equal to 25

percent of the "required annual payment", which in turn is equal
to the lesser of (1)
90 percent of the tax shown on the
individual's return for that year (or, if no return is filed,

percent of his or her tax for such year), or
(2)
90
if the
individual filed a return for the immediately preceding taxable

year, 100 percent of the tax shown on that return.
6654 (d) (1) (B) (i) and (ii).
Sec.
The due dates of the required
installments for a calendar taxable year are April 15, June 15,
and September 15 of that year and January 15 of the following
year.
Sec. 6654 (c) (2).
For purposes of section 6654, an
individual's tax consists of income tax and self-employment tax

and is determined before the application of any wage withholding
credit 17 (but after the application of other allowable credits).
Sec. 6654(f); see sec. 31.
There are two mechanical exceptions to the applicability of
the section 6654 addition to tax.
First, as relevant to this
case, the addition is not applicable if the tax shown on the

individual's return for the year in question (or, if no return is
filed,
the individual's tax for that year), reduced for these
purposes by any allowable credit for wage withholding, is less
17
Under sec. 6654 (g) (1), wage withholding credits are

treated as payments of estimated tax.
14-20333.197
- 22 than $500. 18
Sec. 6654 (e) (1).
Second, the addition is not
applicable if the individual's tax for the preceding taxable year

was zero.
B.
Sec. 6654 (e) (2)

Discussion
1.
Respondent's Section 6651 (a)
(1)
Determinations
We have already concluded, in the context of petitioners'

limitations defense, that the disclaimer statement attached to,
and the alteration of the jurat of, Dr. Trowbridge's initial 1996
Form 1040 rendered that Form 1040 invalid.
Since Dr. Trowbridge
attached a substantially identical disclaimer statement to, and

similarly altered the jurat of, his initial 1997 Form 1040, we
conclude as well that Dr. Trowbridge's initial 1997 Form 1040 is
not a valid return.
In addition to introducing at trial Dr. Trowbridge's
(invalid) initial 1996 and 1997 Forms 1040, respondent produced
evidence that Dr. Trowbridge did not submit to the IRS any other
document purporting to be a return for 1996 or 1997 until January
2000.
Respondent therefore produced evidence that Dr. Trowbridge
did not timely file Federal income tax returns for 1996 and 1997
and that each such failure continued for more than 4 months.
In
the absence of any conflicting or exculpatory evidence (e.g.,

evidence of reasonable cause or lack of willful neglect on the
18
Effective for taxable years beginning after Dec. 31,

1997, the threshold amount is $1,000. Taxpayer Relief Act of
1997, Pub. L. 105-34, sec. 1202(a), 111 Stat. 994.
14-20333.198
- 23 part of Dr. Trowbridge), we conclude that Dr. Trowbridge is

liable for 25-percent additions to tax under section 6651(a) (1)
with respect to his 1996 and 1997 taxable years. 19
Respondent also produced evidence that Dr. Trowbridge did
not make any timely payments in respect of his 1996 and 1997
income taxes and did not claim any tax credits for those years.
Accordingly, the 25-percent additions to tax for which Dr.
Trowbridge is liable under section 6651(a) (1) apply to the full
amount of tax required to be shown on his respective 1996 and
1997 returns.
2.
20
See sec. 6651 (b) (1).
Respondent's Section 6654 Determinations 21
In addition to introducing at trial Dr. Trowbridge's

(invalid) initial 1996 and 1997 Forms 1040, respondent submitted
19
We note that, in computing the amount of the 1997

addition to tax, respondent incorrectly applied a rate of 22.5
percent rather than 25 percent.
See supra note 1.
20
The amount of tax required to be shown on Dr.

Trowbridge's 1996 return is equal to the initial 1996 deficiency
($146,847) plus the additional 1996 deficiency, the latter amount
to be determined under Rule 155 in accordance with part IV of
this report.
The amount of tax required to be shown on Dr.
Trowbridge's 1997 return is equal to the 1997 deficiency
($211,508).
21
Respondent applied the provisions of sec. 6654 without

regard to the amounts shown as tax on the revised 1996 and 1997
Forms 1040 attached by Dr. Trowbridge to the 1996 and 1997 Forms
1040X submitted by him to the IRS in January 2000.
Petitioners
did not assign error to that aspect of respondent's
determinations.
We shall not, therefore, decide whether the
revised 1996 and 1997 Forms 1040 are valid returns or otherwise
take them into account for purposes of determining the
application of sec. 6654.
14-20333.199
- 24 with the summary judgment motion Dr. Trowbridge's
(invalid) 1995
Form 1040, authenticated by affidavit of respondent's counsel. 22

Respondent also produced evidence that Dr. Trowbridge did not
make any timely payments (actual or deemed,
see supra note 17) in
respect of his 1996 or 1997 income taxes that could be applied

against his required annual payments.
Given the foregoing evidence regarding invalid returns, the
general applicability of the estimated tax provisions to Dr.
Trowbridge's respective 1996 and 1997 taxable years depends on
whether Dr. Trowbridge's actual (rather than reported)
those years is greater than zero.
See sec.
tax for
6654 (d) (1) (B).
Similarly, the availability of the $500 de minimis exception with

respect to either such year is determined by reference to Dr.
Trowbridge's actual (rather than reported) tax for each such year
(less any allowable wage withholding credit).
6654(e) (1).
See sec.
As relevant to the application of section
6654 (d) (1) (B), our disposition herein of the default motion
establishes that Dr. Trowbridge's tax for each of 1996 and 1997
is indeed greater than zero.
As relevant to the application of
section 6654(e) (1), such disposition establishes that
22
As referenced in our findings of fact, Dr. Trowbridge's

1995 Form 1040 includes a disclaimer statement that is
substantially identical to the disclaimers attached to his
initial 1996 and 1997 Forms 1040. On that basis, we conclude
that Dr. Trowbridge's 1995 Form 1040 is not a valid return.
See
Williams v. Commissioner, 114 T.C. 136, 143 (2000).
14-20333.200
- 25 Dr. Trowbridge's tax (less allowable wage withholding credits)

for each year far exceeds $500.
Our disposition of the default motion also precludes the
applicability of the section 6654(e) (2) exception (zero tax for
preceding year) with respect to Dr. Trowbridge's 1997 taxable
year.
In that regard, although the record does not reveal Dr.
Trowbridge's tax for 1995, we deem his 1995 Form 1040 (showing
tax of $133,977 and no tax credits) to be evidence that such tax
was greater than zero, which would render the section 6654(e) (2)
exception inapplicable to his 1996 taxable year as well.
Based on the foregoing, and in the absence of any evidence
to the contrary, we conclude that Dr. Trowbridge was subject to
estimated tax with respect to each of his 1996 and 1997 taxable
years and that he made no timely payments in respect of such
liability.
Thus, the amount of Dr. Trowbridge's underpayment
with respect to each installment of his required annual payments

for those years is equal to the full amount of such installment. 23
VI.
Section 6673 Penalty

In pertinent part, section 6673(a) (1) provides:
SEC. 6673.
SANCTIONS AND COSTS AWARDED BY COURTS.
(a) Tax Court Proceedings.--
23
In that regard, we accept respondent's computation of

the 1997 addition to tax ($11,316), and we direct the parties to
determine the amount of the 1996 addition to tax on the basis of
Dr. Trowbridge's 1996 tax (more precisely, 90 percent thereof),
determined in accordance with note 20, supra.
14-20333.201
- 26 (1) Procedures instituted primarily for

delay, etc.--Whenever it appears to the Tax
Court that-(A) proceedings before it have been
instituted or maintained by the taxpayer
primarily for delay,
(B) the taxpayer's position in such
proceeding is frivolous or groundless,
or
the Tax Court, in its decision, may require the

taxpayer to pay to the United States a penalty not in
excess of $25,000.
The purpose of section 6673 "is to compel taxpayers to think
and to conform their conduct to settled principles before they
file returns and litigate."
68,
71
Coleman v. Commissioner, 791 F.2d
(7th Cir. 1986); see also Grasselli v. Commissioner, T.C.
Memo. 1994-581
(quoting Coleman).
A taxpayer's position is
frivolous if it is contrary to established law and unsupported by

a reasoned, colorable argument for change in the law.
Family Trust v. Commissioner, 115 T.C. 523, 544
(2000)
E.g., Nis
We need
not find specific damages to invoke section 6673(a) (1); rather,

that section is a penalty provision, intended to deter and
penalize frivolous claims and positions in deficiency
proceedings.
Bagby v. Commissioner, 102 T.C. 596,
613-614
( 1994) .
Dr. Trowbridge does not here argue for any change in the
law, and there is no plausible argument that, as maintained in
14-20333.202
27 the disclaimers attached to his initial 1996 and 1997 Forms 1040,
the payment of income taxes is voluntary.
Commissioner,
91 T.C. 88,
90 (1988).
E.g., Woods v.
Whatever legitimate
arguments may underlie his assignments of error, Dr. Trowbridge

has emphasized frivolous arguments and, for that reason alone,
deserves to have a section 6673(a) (1) penalty imposed against
him.
We are also convinced by Dr. Trowbridge's conduct that he
both instituted and maintained these proceedings for delay, which
is a separate basis for imposing a section 6673(a) (1) penalty.
We struck substantial portions of the petition.
His discovery
requests ran to hundreds of pages, and we granted respondent's

motion for a protective order with respect thereto.
Notwithstanding his active, indeed forceful, prosecution of this
case initially, Dr. Trowbridge abruptly changed course 2 weeks
before trial.
At that point, he attempted to withdraw the
petition, asserting a jurisdictional challenge premised on his

disavowal of any commercial relationship with, and any enjoyment
of benefits from,
the United States.
trial, despite notice thereof.
He refused to appear for
We interpret Dr. Trowbridge's
actions in prosecuting (and not prosecuting) this case as

evidence of his intent to delay these proceedings.
There is a contemporaneous case in this Court involving Dr.
Trowbridge and his 1991-95 taxable years which involves conduct
14-20333.203
- 28 similar to that involved here.

T.C. Memo. 2003-164.
See Trowbridge v. Commissioner,
We conclude that Dr. Trowbridge deserves a
large penalty under section 6673(a) (1)
Therefore, we shall
impose on him a penalty of $25,000.

To reflect the foregoing,
An appropriate order will
be issued, and decision will
be entered under Rule 155.
14-20333.204
613-10-2324
~2710
2005-045164
GENERAL WARRANTY DEED
NOTICE OF CONF'mENTIALITY lUGBTS: IF YOU ARE A NATURAL PERSON, YOU

MAY REMOVE O:RST'.RIKEANY OF THE FOLLOWING JNFORMAnONFROM THIS
INSTRUMENTaEPOREITISFILEDJOllRECORDINT.REPUBLICUCORDS: YOUR
SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
lliAT DAVID POWERS HOMES, S.T., LTD., A LIMIT&& PARTNEltSfiiP hereinafter called "Grantor"
(wbeth!t one or more) executes this deed, for and in colllideration of the mm of TEN AND NQJlOO DOLLARS
(S 10.00) and other good and valuable 00Jlfidenl1i011. to Omntor in hand paid by JOHN PARKS 'I'.ROWBlUDGE,
JR., A SINGLE P.EISON of MONTGOMERY Co!Uity, Texas. hereinafter called "Gzantce" (whether one or
more), whose mailing addms is 25117 u.MllOC DlUVE POilTJ!Il, TEXAS 773654i36S the ~pt and
sufficiency of which are hereby acknowledged and confessed. and for the further consideration of the execution and
deUvety by said Omntce of one certain PromiS80ry Noce in UJC principal tiWI1 of TWO HUND.U:D NINETYNINE
THOUSAND SEWN B\JNDUD SIXTV'IIG.T AND N0/100 DOLLARS ($199,761.00), bearing even date
herewith, payable to the order of Dl'H MORTGAGE. LTD. hminafter called NMortgagee, bearing interer~t at the
rate therein provided; said Note containing an lrttorneyis fee clmlBc and variOUII acceleration of maturity clauses in case
of default, and being socured by Vendor's Lien and Superior Title retained hetein in favor af said. Gta.ntot and assigned
to Mortgagee, and also being secured by a Dc:ed of Ttust of even date herewith from Grantee to THOMAS G.
BROWN Trustee; and
\V.HElUiAS, Mortgagee bas, at the special i!lfitlmCe and request of Grantee. paid to Grantor all or a portion of the
purchase price of the property hereinafter described, as evidenced by the above described Note, said Vendor's Lien and
Superior Title against said property securing tbe payment of said Note are hereby assigned. transfened and delivered
without recourse to Mortgagee, Grantor ~ ~nveying to lilid Mortgagee !he llllid Superior TiUc to satd property,
subrogating said Mortgagee to all the rights and remedies of Grantor in tho pmnisc:s by virtue of said lien;
And Grantor has GRANTED, SOLD AND CONVEYED. and by these presents does GRANT, SELL AND CONVEY,
unto said Gran~ the following described real property, to-wit.:
LOT SlXTEEN (16), BLOCK ON'I (1), OP BENTWOOD, SECTION ONE (1), A SUBDMSJON OF 1$6,8
ACRtS OF LAND, OUT OF THE WILLIAM MASSE SUR.VJ!Y, A..J9J, AND 1'B1! MARY OWENS
SURVEY,A-405, IN MONTGOMERY COUNTY TtXAS,AS IMPOSI)) BY THE MAP AND DEDICATION
UCORDS IN CABIN~T G, SHEETS 13M. Tll1l01JGB 141A OF THE MAP RECORDS OF'
MONTGOMERY COUNTY, TEXAS
TO HAVE AND TO HOLD the above described premises, together with all and singular the rights and appurtenances
thereunto in anywise ~longing unto said Grantee, his heirs andassigasFOREVBR. Gmntordocs hereby bind himself,
ins heirs, executors and administmtots, TOWARRANT AND PORBVERDBFBNPaU and singula.rth.eakl premiscs
unto the swd Grantee, his heirs and ~JSSip, apimt C:VCJY penon whomsoever lawfully eJa.iming otto otaim the same
or any part thereof.
This Deed is exi!Ctlted, delivered and accepted subject to all and singular any liens securing 1bc payment of any debt
created or assumed in connection herewith and described heRin, ad valorem taxes for the current and all subsequent
years, taxes for sub~l,Jelll assessments for the cumnt aDd prior years due to cha.qcs in land USilgC, ownership, or
both. zoning ordimmcc:s and utility district aacssments, if any, applicable to and enfoK:C8ble against the above
described propeny, and all valid euements, restrictions, mineral teservations and maintena.IJ,( fund liens, if llilY,
applicable to and enforceable against the above describtd property as shown by the R:ords of the County Clerk of the
County in which $Bid real property if; located.
General Warmnty Deed Pag6 1
0&.0 D0086A3.Frm
Government
Exhibit
D
_____________
14-20333.205
~l::ll
'(~1
'(~'(!d
813-10-2325
But it is expressly qrm! that the Grantor herein rc:sc:rves and retains for ru~ his beirs and assigns, a VENDOR'S
LmN, as well as the Superior Title, agaimlt. the above dc:scribed property, prcmi.scs and impl'OVflii'ICillll, until the above
descn"bed N~ and all inhm!&t t:heteon have been fully paid acc;ording to the terms tbereof, when this Deed shall
become absolute.
When Utis Deed is e:uoutcd by more than one person or a corpotation or other entity other than a natural person, or
when the: Omnteo is more than one pcnoq, or a corporation or other entity otbcr than a natural person, the instrument
shall read as though pertinent vems, nouns and pronoons were changed. c:onespcmdingly, and when wx:uted by or tO
a coiJ)Omtion or other entity other than a natural pei'90D, the words "hci.r&, cxooutors and administtatOl'S" or "hei:Js and
assigns" sball beronsttued to m.ea.n "su<:c:essors 8M 8.llligns," ~to any pnder shall include either gender and,
in the case of a corporation, shall include the neuter gender, all as the case may be.
EXECUTED this the 25th day of April, 2005.
THE STATEOf;r'BXAS
'
COUNTYOF
fT'\r('v
This instrument was acknow1qe4 bct'o1e me on the ~'aay of
PRESIDENT OJ' DJPH LLC., GE,_:&RAL PAIT.NER. ott baalf' of DA~i11D'~,WE1~
a Texas limited pal'Ulerf;hip, on behalf of said limited partnellltip.
At t.h
...........i
MiM~i..tW!;IUN
tfmi...ol'i"$cordatlon, this ln,trument ws
found to ba Inadequate 1or ~he ~~~~~ ptllliOIJtaphlc

raproduetlon t!ecauae ol ,u~llbMy. carbon Of
pi\CilO copy lilscolol&d papar, etc. All blackouts,

addition I and changes were present at the time
the Instrument waa tiled and recorded.
FlLED FOR RECORC

?.nOS "AY 2 PH 2: l.9
A~i~
COUNTY CLEm(
10tffGO"RY COUNTY. TXA5
TOTAL P.03
14-20333.206
813-10-2326
After recording please mail to:
DPH MORTQAGE, LTD.
[Company Name]
ATTN: CIIARLOTTE BANKS 1331 GEMINI #100
[Street Address]
I
HOUSTON. TX 77058
[City, State Zip Code]
2005-045165
_ _ _ _ _ _ _ _ _ [Space Above Thil Line For Recording Data]_ _ _ _ _ _ _ __
DEED OF TRUST
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU
MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS
INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR
SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
MIN;
100020700004527106
DEFINITIONS
Words used in multiple sections of this document are defined below and other words are defined in Sections 3, 11, 13,
18, 20 and 21. Certain rules regarding the usage of words used in this document are also provided in Section 16.
(A) "Security Instrument" means this document which is dated
document.
~.
2005 together with all Riders to this
(B) "Borrower" is JOHN PARK$ TROWJJ.UPGE, JR., A SINGLE PERSON. Borrower is the grantor under
this Security Instrument.
(C) "Lender" is DPH MORTGAGE. LID.. a limited partne!]bip. Lender is organized and existing under the
Jaws of TEXAS. Lender's address is 1331 GEMINI 1100 JIOUSTON. TX 77058
Lender includes any holder of the Note who Is entitled to receive payments under the Note.
(D) "Trustee" is THOMAS G. BROWN. Trustee's address is 1331 GEMINI #100 HOUSTON, TX 77058.
(E) "MERS" is Mortgage Electronic Registration Systems, Inc. MERS, is a separate corporation that is acting solely
as a nominee for Lender and Lender's successors and assigns. MERS is the beneficiary under this Security
Texas Deed ofTrust-Smgle FamiJy.

Fannie Mat>JF'reddie Mac UNIFORM INSTRUMENT
MERS Modified Form 3044 01/01

Pago 1 of 14
14301TX 08/00 D&ODoo4000A.Fnn
14-20333.207
813-10-2327
Instrument. MERS is organized and existing under the laws of Delaware, and has an address and telephone number
ofP.O. Box 2026, Flint, MI 48501-2026, tel. (888) 679-MERS.
(F) "Note" means the promissory note signed by Borrower and dated April25 ,2005. The Note states that Borrower
owesLenderTWQBUNDUDNINETY-NINETHQUSANDSEVENifUNDREDSIXTYEIGHTANJ)N0/100
Dollars (U.S. $299, 768.00) plus interest Borrower has promised to pay this debt in regular Periodic Payments and to
pay the debt in full not later than Mav 1. 2035.
(G) "Property" means the property that is described below under the heading "Transfer of Rights in the Property."
(H) "Loan" means the debt evidenced by the Note, plus interest, any prepayment charges and late charges due under
the Note, and all sums due under this Security Instrument, plus interest.
(1) "Riders" means all Riders to this Security Instrument that are executed by Borrower. The following Riders are to
be executed by Borrower [check box as applicable]:
""
Adjustable Rate Rider
Other(s) [specify]
D Condominium Rider
""X
Planned Unit Development Rider
D 1-4 Family Rider

D Biweekly Payment Rider
INTEREST-ONLY ADDENDUM D Second Home Rider

TO ADJUSTABLE RATE RIDER
D Occupancy Rider
(J) "Applicable Law" means all controlling applicable federal, state and local statutes, regulations, ordinances and
administrative rules and orders (that have the effect of law) as well as all applicable final, non-appealable judicial
opinions.
(K) "Community Association Dues, Fees, and Assessments" means all dues, fees, assessments and other charges
that are imposed on Borrower or the Property by a condominium association, homeowners association or similar
organization.
(L) "Electronic Funds Transfer" means any transfer of funds, other than a transaction originated by check, draft,
or similar paper instrument which is initiated through an electronic terminal, telephonic instrument, computer, or
magnetic tape so as to order, instruct, or authorize a financial institution to debit or credit an account, Such term
includes, but is not limited to, point-of-sale transfers, automated teller machine transactions, transfers initiated by
telephone, wire transfers, and automated clearinghouse transfers.
(M) "Escrow Items" means those items that are described in Section 3.
(N) "Miscellaneous Proceeds" means any compensation, settlement, award ofdamages, or proceeds paid by any third
party (other than insorance proceeds paid under the covemges described in Section 5) for: (i) damage to, or destruction
of, the Property; (ii) condemnation or other taking of all or any part of the Property; (iii) conveyance in lieu of
condemnation; or (iv) misrepresentations of, or omissions as to, the value and/or condition of the Property.
(0) "Mortgage Insorance" means insurance protecting Lender against the nonpayment of, or default on, the Loan.
(P) "Periodic Payment" means the regularly scheduled amount due for (i) principal and 'interest under the Note, plus
(1i)
any amounts under Section 3 of this Security Instrument.
Texas Deed of Trust-Single Famtly-
Fannie Mae/Freddie Mac Ui:.nFORM INSTRU"lll.iE'rl'f
Page 2 of 14
MERS Modified Fonn 3044 01/0J

I430!TX osioo D&ODoc4000AFnn
14-20333.208
613-10-2326
(Q) "RESPA" means the Real Estate Settlement Procedures Act (12 U.S.C. 2601 et seq.) and its implementing
regulation, Regulation X (24 C.F.R. Part 3SOO), as they might be amended from time to time, or any additional or
successor legislation or regulation that governs the same Sllbject matter. As used in this Security Instrument, "RESPA"
refers to all requirements and restrictions that are imposed in regard to a "federally related mortgage loan" even if the
Loan does notqualify as a "federally related mortgage loan" under RESPA.
means
(R) "Succe1110r in Interest of B11rrower"

any party that has taken title to the Property, whether or not that
party has assumed Borrower's obligations under the Note and/or this Security Instrument
TRANSFER OF RIGHTS IN THE PROPERTY
The beneficiary of this Security Instrument is MERS (solely as nominee for Lender and Lender's successors and
assigns) and the successors and assigns ofMERS. This Security Instrument secures to Lender: (i) the repayment of the
Loan, and all renewals, extensions and modifications of the Note; and (ii) the performance of Borrower's covenants
and agreements under this Security Instrument and the Note. For this purpose, Borrower irrevocably grants and
conveysto Trustee, in trust, with power of sale, the following described property located in
the
County
of
MONTGQMJ;RY
[Type ofRecording JurisdiCtion}
[Name of Recording Jurisdiction]
LOT SIXTEEN (16), BLOCK ONE (1), OF BENTWOOD, SECTION ONE (1), A
SUBDMSION OF 156.8 ACRES OF LAND, OUT OF THE WILLIAM MASSEY SURVEY,
A-39l,ANDTBEMARYOWENSSUJtVEY,A-4GS,INMONTGOMEitYCOUNTY, TEXAS,
AS IMPOSED BY THE MAP AND DEDICATION UCORDS IN CABINET G, SHEETS
138A THROUGH 141A OF THE MAP U:CORJJS OF MONTGOMERY COUNTY, TEXAS
which currently has the address of _ _ _ _ __.l,..5'""1"-17,_MM__,.,.R...,O...C"'"K.....,D:.:RIVE=.:.=-----------'
[Street]
_ _ _P._Q~R"'TE""""R..__ _ _ _,Texas ---"-77,3""6"'"5..""""36""5'---------<"Property Address");

[City}
(Zip Code]
TOGETHER WITH all the improvements now or hereafter erected on the property, and all easements,
appurtenances, and fixtures now or hereafter a part of the property. All replacements and additions shall also be
covered by this Security Instrument. All of the foregoing is referred to in this Security Instrument as the "Property."
Borrower understands and agrees that MERS holds only legal title to the interests granted by Borrower in Uris Security
Instrument but, if necessary to comply with law or custom, MERS (as nominee for Lender and Lender's successors and
assigns) has the right: to exercise any or all of those interests including, but not limited to, the right to foreclose and
sell the Property; and to take any action required of Lender including, but not limited to, releasing and canceling this
Security Instrument.
BORROWER COVENANTS that. Borrower is lawfully seised of the estate hereby conveyed and has the right
to grant and convey the Property and that the Property is unencumbered, except for encumbrances of record. Borrower
warrants and will defend generally the title to the Property against all claims and demands, subject to any
encumbrances of record.
TillS SECURITY INSTRUMENT combines uniform covenants for national use and non-uniform covenants
with limited variations by jurisdiction to constitute a uniform security instrument covering real property.
Texas Deed ofTrust-Single FamilyFannie Mae/Freddie Mac UNIFORM INSTRUMENT
MERS Modified Fonn 3044 01/01
Page 3 .of 14
i430!TX; 0~00 D&.ODoc4000A.Fnn
14-20333.209
813-10-2339
. a Notary Public, on this day personally
(or ~r~ed to me on the oath of
octluoogh
/D
[description ofidentity card or other document]) to be the person

w ose name is subscribed to the foregoing instrument and acknowledged to me that he executed the same for the
purposes and consideration therein expressed.
Given under my hand and seal of office this
~dayof~
Title of Officer
My Commission Expires:
AFTER RECORDING
RETURN ORIGINALS TO:
DPH MORTGAGE, LTD.
ATTN: CHARLOTTE BANKS
1331 GEMINI #100
HOUSTON, TX 77058
Tellllll Deed of Trust-Single Family

Fannie Mae/Freddie Mac UNIFORM )NSTIU.Jl\IIENT
PaJ!e 14 of 14
. MERS Modified ).lorm 3044 01/01

14301TX 0&.100 D&.OD<wAOOOAFnn
14-20333.210
I IIIII llllllllllllllllfllllllllllllllll Ill

PI145-2012104786-4
\CC
Public record notice: When recorded return to:
f'-re ehvn
%
v~dv re--<i>
eo, Box
u&o
Go84'1
REAL PROPERTY BILL OF EXCHANGE

CONTRACT & AGREEMENT
This contract is dated this Z--61J'ay of
Qcf.,~
2-ot'Z.-, and is between,
Job P~lY:-vwfo-v,~e, Jv:
hereafter known as PARTY OF THE.FIRS PART and,
~etlo-wt V~ ks
U&o
hereafter known as PARTY OF THE SECOND PART.

The parties named herein reserve all rights to the Course of the Common Law, without
prejudice, and come together this date in this two party contractual relationship to transfer
complete and absolute ownership and control over the following described property:
Party of the First Part warrants that he/she has full and absolute ownership rights, and rights
of control of said described property. That the property is free of liens and encumbrances,
and by this unconditional Real Property Bill of Exchange- Contract and Agreement,
Real Estate Bill of Exchange
S7-3
I of 3
Rev 8199
Government
Exhibit
E
_____________
14-20333.211
Party of the Second Part offers consideration acceptable to the party of the First Part in the
amount of One Thousand Dollars and no 00/100 ($1,000 and no 00/100) in trade for the
above described property, all absolute ownership and control at-law ofthe above described
property, on the condition that it is free from liens, encumbrances and any trusteeships that
would exercise ownership and control rights that would negate the Party of the Second
Part's free use of purchased property as an absolute property right.
Party of the First Part accepts the tendered offer at-law of the above trade on the Party of
the Second Part's conditions, warranting that liens and/or encumbrances have been
extinguished and trusteeships have been revoked and made null and void by certified mail
service, or in person, on or about the
.}, , of ~ ::?o I 2. and conveys absolute
property ownership to buyer
2--4
Party of the First Part now delivers, by this instrument, the above described property to the
Party of the Second Part, and the Party of the First Part acknowledges receipt of One
Thousand Dollars and oo/100 ($1,000 and no 00/100) in consideration acceptable to the
Party of the First Part in Trade for the absolute ownership and control at-law of the above
described property.
This Bill of Exchange Contract and Agreement serves as a public notice to all that the Party
of the Second Part and the Party of the First Part are functioning by the course of the
common law by exercising full and complete rights of absolute ownership and control over
property traded. All rights are reserved to the Course of the Common Law, none are
waived without prejudice.
PROTECfiON OF LAW: The authority of the parties, named herein, under the terms and obligations of this Real Property Bill of
Exchange and Contract and Agreement is protected under the provisions ofi:IO:J; 4:2:1; 6:2; AMENDMENTS 1,4,6,7,9,10 &14 of the
U.S. Constitution the Supreme Law of the Land, Bll<s Law Die Pg. 643, 644, 645, 1602, 1603, 1385. The parties named herein as well as
the Terms Conditions and Obligations of this Real Property Bill of Exchange and Contract and Agreenent is NOT SUBJECT TO
FEDERAL OR STATE STATUTORY OR REGULATORY JURISDICTION. SEE: USC 42 1981, 1983; Hale v. Henkle 201 U.S.
43.; Kaufman v. Jurzak 102 N.J.Eq. 66,139A. 716; McLyman v. Miller, 52 R.I. 374, !6l,a.a Ill, 112; People v. Smith, 112 Mich. 19270
N.W. 466.67 AtnSt.Rep.392.; Mullins v. Commonwealth, 179 Ky. 71, 200 S.W.9,ll.; Filtsch v. Bishop, 118 okl. 272, 274P.ll10, !Ill;
Treat v. Tolman, C.C.A.N.Y., 113F.893, 51 C.C.A. 552; Reynolds, 21 Cal. 2nd 251, 254; Taylor v. Porter, 4 Hill140, 146(1843); State v.
Simon, 2 Spears 761(1884); U.S. v. WoogKim Alt., 169, 18 S.Ct.456; Reid v. Covert 365 U.S. l,L.Ed.2nd 1148(1957); Miranda v. Ariz.,
384 U.S. 436 at 491(1966); Redfield v. Fisher, 292 P813.; Coppage v. Kansas., 236 U.S. I, at 14; Butchers Union Co. v. Cresmt City Co.;
Cooper v. Aron, 358 U.S. 1.
WARNING: Any person, Federal or State Administrative agent(s), Law Enforcement Officer(s), Legislator(s), or Judicial Offioer(s), who
by act or omission , custom or usage, or under COLOR OF' LAW , Federal or siate STATUTE, REGULATION, or ORDINANCE ~air or
abridge any or all the terms or oblig;rt.ioos of this Real Property Bill of&hange Cootract and Agreement or impair the actions of the abcve
named Parties or the obligations stated herein, under USC 18 241, 242, 1001, 3571 shall be subject to criminal fmes up to 250K per count
and imprisonment up to I 0 Years per CQU!It, imprisoornent for life should such act or omission result in the death of the Parties. All parties
including Courts of all jurisdictions, Federal oc State Officials who by act or omission abridge or impair any term or oblig;rt.ion of this Real
Property Bill of Exchange Contract and Agreement, under USC 42 1983, 1985, 1986, 1988 are subject to civil penalty with no form of
immunity, the 11th Amendment does not bar such suites in Federal Court. SEE: USC 42 2000d-7, 2000e(i); Haferv. Melee. No. 90-681,
P. 4001(1991).
ACKNOWLEDGMENTS: The Party of the First Part agrees to Warrant and forever
defend the right of absolute ownership, to the above said property unto the Party of the
S7-3
2 of 3
Rev 8/99
14-20333.212
Second Part, against the claims of all persons whomsoever. The Party of the Second
Part,accepts absolute ownership, as per the terms conditions and warranties stated herein.
State of
T'f/1--a.S
I L
County of oqm ~
State of
Iez;p 5
SS.,
County of
tkmS.
ss.,
~sonally appeared before me on
,_., ....M.
this _"?G
__' Ciay
Then P!!fSOnally appeared before me on this .z.#ctay

of 6~f.Ot2-
Then
(for) the Party of the First Part, known't;;J m'e to be the

person who ackno !edged the foregoing d
free act and deed. - -r---.1
(for) the Party of the Second Part, known to met~ t.h?

person who acknowledged the foregoing document as a
~arrfo;Tnzwb"YI';Lt.JV'.
of ~iof7--
LL...-#
.....,.."'"d deed.
r _
0,
Park TvruvbY't'~~I
etit'Y FVueo;
~
S'
Notary Public
3 of 3
S7-3
Rev 8/99
14-20333.213
Doc# 2012104786
FILED FOR RECORD

10/25/2012 10:42AM
/11J~
COUNTY CLERK
MONTGOMERY COUNTY, TEXAS
STATE OF TEXAS
COUNTY OF MONTGOMERY
I hereby certify this instrument was filed in file number
sequence on the date and at the time stamped herein
by me and was duly RECORDED in the Official Public
Records of Montgomery County, Texas.
10/25/2012
County Clerk
Montgomery County. Texas
14-20333.214

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
ORDER
The Court, having considered the UNITED STATES MOTION FOR SUMMARY
JUDGMENT AND MEMORANDUM IN SUPPORT, and any response or reply thereto,
it is hereby ORDERED that:
1.
The United States motion is GRANTED; and
2.
Judgment shall be entered in favor of the United States and against John
Parks Trowbridge, Jr., in the amount of $3,326,015.01, plus statutory additions accruing
after April 7, 2014; and
3.
The United States has valid and subsisting federal tax liens on all property
and rights to property of John Parks Trowbridge, Jr., including the property located at
25117 Ramrock Drive, Porter, Texas; and
4.
The United States may foreclose its liens against the property located at
25117 Ramrock Drive, Porter, Texas, and will submit a proposed order of sale to this
Court within 10 days from the date of this order.
SIGNED this ________ day of _____________________________ , 2014.
________________________________
818218.2
14-20333.215
14-20333.216
14-20333.217

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES OPPOSITION TO MOTION TO DISMISS

The United States filed a motion for summary judgment in this case on Friday,
April 4, 2014. (Dkt. #19.) The United States incorporates its motion for summary
judgment, by reference, in response to the motion to dismiss filed by Defendant John
Parks Trowbridge, Jr. (Dkt. #18.)
Trowbridges motion to dismiss cites irrelevant law and then asks that the case
be dismissed because of a lack of subject matter jurisdiction of the Court. (Dkt. #18 at
1.) As stated in the United States Complaint (Dkt. #1), this Court has jurisdiction
pursuant to 28 U.S.C. 1340, which gives district courts original jurisdiction of any civil
action arising under any Act of Congress providing for internal revenue1 Further,
this Court has jurisdiction under 28 U.S.C. 1345, which gives district courts original
jurisdiction of all civil actions, suits or proceedings commenced by the United States2
1
2
28 U.S.C. 1340.
28 U.S.C. 1345.
14-20333.218
Finally, the relief sought by the United States (i.e. entry of judgment and enforcement of
liens) is also authorized by statute.3
Trowbridge refers to points and authorities in his motion to dismiss; however,
the only arguments made are arguments rejected by courts throughout the country.
The crux of Trowbridges argument is that he is not subject to tax because he is not a
citizen of the United States, which is patently frivolous and has been rejected by the
courts. See e.g. United States v. Long, 2005 U.S. Dist. LEXIS 13443, *7 (W.D. Tex.
2005)(citing cases rejecting frivolous arguments made regarding claims that they are not
U.S. citizens but natural persons, legal entities, or citizens of the State and not the
United States).
deny the motion to dismiss. The United States also requests such further and other
relief to which it may be justly entitled.
26 U.S.C. 7401, 7402(a), (f), 7403.

U.S. Opposition to Motion to Dismiss
Page 2 of 4
14-20333.219
DATE:
April 9, 2014
KENNETH MAGIDSON
/s/ Joshua Smeltzer

JOSHUA SMELTER
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)

Page 3 of 4
14-20333.220
I certify that on April 9, 2014, the foregoing UNITED STATES OPPOSITION
TO MOTION TO DISMISS, was served via ECF Filing and/or United States Mail,
postage pre-paid, as follows:
25117 Ramrock Dr.
Porter, TX 77365
25117 Ramrock Dr.
Porter, TX 77365
Lori Gruver
Austin, TX 78760
JOSHUA D. SMELTZER

Page 4 of 4
14-20333.221

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES COURT ORDERED SUPPLEMENT

Pursuant to the Courts April 7, 2014, Order (Dkt. #21), the United States submits
one of the objectionable tax returns (Form 1040 for 1997) as an example of the returns
discussed by the Tax Court when upholding deficiencies against Mr. Trowbridge for
the tax years at issue (i.e. 1993, 1994, 1995, 1996, and 1997). The objectionable return
example is attached to this supplement as Government Exhibit F.1
As discussed by the United States in its motion for summary judgment (Dkt.
#19), the tax deficiencies were upheld by the Tax Court for all the years at issue in this
lawsuit. (Dkt. #19 at Gov. Exs. C-1 and C-2.) As part of both decisions, the Tax Court
noted that Trowbridge filed returns containing a disclaimer indicating zero tax liability.
(Dkt. #19 at Gov. Ex. C-1 at 5 and Gov. Ex. C-2 at 7.) The Tax Court quoted a portion of
Trowbridges disclaimer as follows:
This exhibit continues the exhibit numbers contained in the United States Motion for Summary Judgment. (Dkt.
#19.)
14-20333.222

John respectfully declines to volunteer concerning
assessment and payment of any tax balance due on the
return or any redetermination of said tax. Be it known that
we, separately and together, therefore, deny tax liability and
do not admit that the stated amount of tax on return, as
calculated solely by reference to provided tables, is due and
collectible. The tax return read as a whole shows no amount
as being the tax and shows the tax to be zero and zero is the
starting point in determining a deficiency or any other action
involving this return.2
The Tax Court noted that the similar statements were made on the returns filed
for 1991, 1992, 1993, 1994, 1995, 1996, and 1997. (Dkt. #19 at Gov. Ex. C-1 pgs. 5-8 and
Gov. Ex. C-2 pgs. 7-8.) The entire disclaimer, including the portions quoted by the Tax
Court, is contained in Government Exhibit F (i.e. Form 1040 for the 1997 tax year)
attached at the request of the Court.
WHEREFORE, the United States asks that its motion for summary judgment be
granted and that judgment be entered against Trowbridge and that the property be sold
to satisfy the large outstanding tax debts.
The quotations are included in the exhibits to the United States Motion for Summary Judgment. (Dkt. #19 at
Gov. Ex. C-1 at 5 and Gov. Ex. C-2 at 7.)
U.S. Court Ordered Supplement
Page 2 of 4
14-20333.223
DATE:
April 14, 2014
Respectfully submitted,
KENNETH MAGIDSON
/s/ Joshua Smeltzer

JOSHUA SMELTER
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)

Page 3 of 4
14-20333.224
I certify that on March 12, 2014, the foregoing UNITED STATES COURT
ORDERED SUPPLEMENT was served via ECF Filing and/or United States Mail,
25117 Ramrock Dr.
Porter, TX 77365
25117 Ramrock Dr.
Porter, TX 77365
Lori Gruver
Austin, TX 78760
JOSHUA D. SMELTZER

Page 4 of 4
14-20333.225
Government
Exhibit
F
_____________
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14-20333.289

versus
Civil Action 4:14cv00027
Order Setting Hearing

1.
A hearing will be held before Lynn N. Hughes on

May 21, 2014
at 10:00 AM
Courtroom 11C, Eleventh Floor
United States Court House
515 Rusk Avenue
Houston, Texas 77002.
2.
To ensure full notice, whoever receives this notice must confirm that every
other party knows of the setting.
3.
Each party must appear by an attorney with (a) full knowledge of the facts
and (b) authority to bind the client.
4.
Although the court will hear the identified motion, it will also consider other
motions, narrow issues, inquire about and resolve expected motions,
interrogate counsel, and schedule discovery. Counsel are to consult among
themselves about these matters well in advance.
Signed on April 24, 2014, at Houston, Texas.
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14-20333.337
14-20333.338

HOUSTON DIVISION
Plaintiff
VS.

OFFICE,
Defendant
STIPULATION
The United States of America (the Government), and Montgomery County Tax Office
(the Taxing Authorities), stipulate and agree as follows:
1.
The Taxing Authorities received notice of the Complaint in this case [docket #1] and
notice of their right to file a claim to property mentioned in that Complaint.

2.
The Taxing Authorities, through counsel, filed their Original Answer of Montgomery
County Tax Office [docket #9], asserting that they have an interest in the following real property
ordered forfeited from the defendant, Real Property Known as 25117 Ramrock Drive, Porter,
Texas being more specifically described as follows:
Lot Sixteen (16), Block One (1), of Brentwood, Section One (1), a Subdivision of 156.8
Acres of Land, Out of the William Massey Survey, A-391, and the Mary Owens Survey,
A-405, in Montgomery County, Texas, as Imposed by the Map and Dedication Records
in Cabinet G, Sheets 138A through 141A of the Map Records of Montgomery County,
Texas.
3.
Based on the distinct facts and circumstances of this case, the Taxing Authorities have a
valid interest in the property, specifically, ad valorem taxes penalties and interest.
4.
The Taxing Authorities release and hold harmless the Government and any agents,
employees, and servants of the Government (and any state or local law enforcement agencies and
their agents, servants, or employees), acting in their official or individual capacities from any and
14-20333.339
all claims by them and their agents that currently exist or which may arise as a result of the
Governments action(s) against or relating to the property, including a petition for remission.
5.
The Taxing Authorities agree to the entry of a Final Judgment forfeiting the property to
the Government and providing for payment of their interest (as described in paragraph 4) after
payment of all costs incurred in protecting and selling the property. The Taxing Authorities
consent to the drafting and submission of a Final Order (and its accompanying Motion) by the
Government.
6.
The Government and Taxing Authorities will bear their own costs and/or attorneys fees.
14-20333.340
STIPULATED AND AGREED:

LORI GRUVER
/s/ Lori Gruver______________________
LORI GRUVER
LINEBARGER GOGGAN
P.O. Box 17428
Austin, Texas 78760
(512) 447-6675 (Telephone)
(512) 693-0728 (Facsimile)
KENNETH MAGIDOSN
UNITED STATES ATTORNEY
/s/ Joshua D. Smeltzer_________________

JOSHUA D. SMELTZER
Attorney in Charge
Maryland Bar (No Bar Number)
Dallas, TX 75201
(214) 880-9735 (Telephone)
(214) 880-9741 (Facsimile)
14-20333.341

HOUSTON DIVISION

Plaintiff,
v.
Case No.: 4:14cv00027


Defendant.
Official Transcript Filed

An official transcript has been filed. It may contain information protected from public disclosure by law.
See EGovernment Act of 2002, Fed. R. Civ. P. 5.2(a) or Fed. R. Crim. P. 49.1(a).
Ninety days after a transcript has been filed, it will be electronically available to the public on PACER. To
comply with the rules on privacy, the parties must redact protected information before it is available on
PACER.
If redaction is needed, the parties must file a statement listing the items to be redacted, with the transcript's
docket number and the item's location by page and line. It must be filed within 21 days of the transcript
being filed. A suggested form is at www.txs.uscourts.gov.
Only these portions of data may be visibile:
Last four digits of a social security number or taxpayer identification number;

Year of a person's birth;
Initials of a minor's name;
Last four digits of an account number; and
City and state of a home address in criminal cases.
Additional redactions require a separate motion and court approval.

A party may view the transcript at the public terminals in the clerk's office or buy it through
www.txs.uscourts.gov or by calling (713) 2505500 . A party is only responsible for reviewing the:
Opening and closing statements made for his party;

Statements by his party;
Testimony of witnesses called by his party; and
Other parts ordered by the court.
Redaction is your responsibility. The court, clerk, court reporter, or transcriber will not review this transcript
for compliance.
David J. Bradley, Clerk
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HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES OPPOSITION TO MOTION TO DISMISS (Dkt. #37)

The United States filed a motion for summary judgment in this case on April 4,
2014. (Dkt. #19.) The United States also filed an opposition to the previous motion to
dismiss filed by Defendant John Parks Trowbridge, Jr. (Dkt. #22.) The Court denied
Trowbridges first motion to dismiss (Dkt. #34) and now Trowbridge is again seeking
dismissal. (See Dkt. #37.)
As with the first motion to dismiss, Trowbridge cites irrelevant law and then
asks that the case be dismissed because of a want of jurisdiction of the Court (Dkt.
#37 at 2.) As stated in the United States Complaint (Dkt. #1), this Court has jurisdiction
pursuant to 28 U.S.C. 1340, which gives district courts original jurisdiction of any civil
action arising under any Act of Congress providing for internal revenue1 Further,
this Court has jurisdiction under 28 U.S.C. 1345, which gives district courts original
28 U.S.C. 1340.
14-20333.374
jurisdiction of all civil actions, suits or proceedings commenced by the United States2
Finally, the relief sought by the United States (i.e. entry of judgment and enforcement of
liens) is also authorized by statute.3
Trowbridge continues to make arguments in his motions to dismiss that are
soundly rejected by courts throughout the country. See e.g. United States v. Long, 2005
U.S. Dist. LEXIS 13443, *7 (W.D. Tex. 2005)(citing cases rejecting frivolous arguments
made regarding claims of citizenship and jurisdiction of the courts).
The crux of his most recent frivolous argument is a semantic argument that the
phrasing used to identify the United States of America renders this Court without
jurisdiction. As outlined above, this Court clearly has jurisdiction over this matter and
Trowbridges arguments otherwise are patently frivolous.
deny the motion to dismiss. The United States also requests such further and other
relief to which it may be justly entitled.
2
3
28 U.S.C. 1345.
26 U.S.C. 7401, 7402(a), (f), 7403.
U.S. Opposition to Motion to Dismiss (Dkt. #37)
Page 2 of 3
14-20333.375
DATE:
May 12, 2014
KENNETH MAGIDSON
/s/ Joshua Smeltzer
JOSHUA SMELTER
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)
I certify that on May 12, 2014, the foregoing UNITED STATES OPPOSITION
TO MOTION TO DISMISS, was served via ECF Filing and/or United States Mail,
25117 Ramrock Dr.
Porter, TX 77365
25117 Ramrock Dr.
Porter, TX 77365
Lori Gruver
Austin, TX 78760
JOSHUA D. SMELTZER
U.S. Opposition to Motion to Dismiss (Dkt. #37)
Page 3 of 3
14-20333.376

HOUSTON DIVISION
Plaintiff
VS.

OFFICE,
Defendant
UNOPPOSED MOTION BY MONTGOMERY COUNTY TAX OFFICE

TO PERMIT THEIR ATTORNEY TO BE EXCUSED FROM ATTENDING THE
CONFERENCE SET MAY 21, 2014
TO THE HONORABLE UNITED STATES DISTRICT COURT:
1.
On April 24, 2014 the Court set a conference in this case for May 21, 2014 in
Houston.
2.
Montgomery County Tax Office is a claimant in this case holding a lien on the
subject property to secure payment of the ad valorem taxes owed. There is no dispute with the
United States or any other party in this matter regarding the claims of Montgomery County.
3.
The United States and Montgomery County Tax Office entered into a stipulation,
filed on April 30, 2014, docket number 29, resolving the claim of Montgomery County.
WHEREFORE, premises considered the movant request that its attorney in charge, Lori
Gruver, be excused from attending the May 21, 2014 conference. Alternatively, it requests that
she be permitted to participate by telephone from her office in Austin.
Respectfully submitted,
1
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LORI GRUVER
By:
__/s/ Lori Gruver_____________________

LORI GRUVER
LINEBARGER GOGGAN
P.O. Box 17428
Austin, TX 78760
(512) 447-6675 (Telephone)
(512) 693-0728 (Facsimile)
CERTIFICATE OF CONFERENCE
Counsel is authorized to represent that she has contacted the attorney for the United
States and Pro SE John Parks Trowbridge, Jr., Freedom Ventures UBO, and they are unopposed
to the relief sought in this motion.
/s/ Lori Gruver
LORI GRUVER
______
True and correct copies of the foregoing motion and proposed order were served on the
following attorneys of record through the Courts ECF system or by facsimile transmission on
May 14, 2014:
Joshua D. Smeltzer
United States Assistant Attorney
John Park Trowbridge, Jr., Freedom Ventures UBO
Defendant
/s/ Lori Gruver
LORI GRUVER
_____
2
14-20333.378

HOUSTON DIVISION
Plaintiff
VS.

OFFICE,
Defendant
ORDER GRANTING UNOPPOSED MOTION TO EXCUSE

THE ATTORNEY FOR MONTGOMERY COUNTY TAX OFFICE FROM
APPEARING IN PERSON AT THE MAY 21, 2014 CONFERENCE
The motion to permit Lori Gruver to be excused from the May 21, 2014 conference is
granted.
Signed May _________, 2014 at Houston, Texas.
Lynn N. Huges
United States District Court Judge
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HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES OPPOSITION TO FORMAL CHALLENGE OF JURISDICTION

This is the third time the United States has been required to file an opposition to
a frivolous claim that there is no jurisdiction in this case. (See Dkt. #22, 40.) The Court
has denied all the previously filed claims that the Court lacks jurisdiction and
specifically ordered that [t]his court has jurisdiction. (Dkt. #34, #42.) Now
Trowbridge lodges formal challenge to Plaintiffs allegation that Defendant resides
within the jurisdiction of the Court. (Dkt. #45.) This formal challenge is signed by
Trowbridge above his address at 9816 Memorial Boulevard, #205, Humble, Texas. (Dkt.
#45.)
Humble is a city located in Harris County, Texas.1 Pursuant to 28 U.S.C. 124(b),
the United States District Court for the Southern District of Texas covers seven
divisions, including the Houston Division. The Houston Division comprises the
counties of Austin, Brazos, Colorado, Fayette, Fort Bend, Grimes, Harris, Madison,
1
See The History of the City of Humble, http://www.cityofhumble.org/history.html (Humble is located in the
Northeast quadrant of Harris County and covers approximately 10 square miles).
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Montgomery, San Jacinto, Walker, Waller, and Wharton.2 Trowbridge clearly resides
within the jurisdiction of this Court. The property the United States seeks to foreclose is
located in Porter, Texas, which is in Montgomery County and also within the
jurisdiction of the Court.3 The formal challenge of jurisdiction is merely a backhanded reassertion of the frivolous arguments this Court has twice denied. (Dkt. #34,
#42.)
deny the Formal Challenge of Jurisdiction and award such further and other relief to
which the United States may be justly entitled.
DATE:
May 16, 2014
KENNETH MAGIDSON
/s/ Joshua Smeltzer
JOSHUA D. SMELTER
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)
2
3
28 U.S.C. 124(b)(2) (emphasis added).

Id.
U.S. Opposition to Formal Challenge of Jurisdiction
Page 2 of 3
14-20333.389
TO FORMAL CHALLENGE OF JURISDICTION, was served via ECF Filing and/or
United States Mail, postage pre-paid, as follows:
25117 Ramrock Dr.
Porter, TX 77365
9816 Memorial Boulevard, #205
Humble, Texas 77338
25117 Ramrock Dr.
Porter, TX 77365
Lori Gruver
Austin, TX 78760
JOSHUA D. SMELTZER
U.S. Opposition to Formal Challenge of Jurisdiction

Page 3 of 3
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14-20333.429

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES OPPOSITION TO MOTION FOR STAY PENDING APPEAL

Trowbridge filed yet another motion in his continued attempt to stall the United States
collection efforts indefinitely. (See Dkt. #56.) The United States opposes the requested stay of
the order of sale and vacature (Dkt. #54) and any other attempt by Trowbridge to further delay
collection of the outstanding tax debts through a stay or extension of enforcement. Any stay or
extension of the time for enforcement would substantially prejudice the United States collection
efforts of the $3,326,015 of long over-due tax liabilities. (Dkt. #53.)
STATEMENT AND DISCUSSION
The Court entered an Amended Final Judgment in the amount of $3,326015.01, plus
interest, against Trowbridge for tax liabilities affirmed by the Tax Court in 2003. (See Dkt. #53.)
Trowbridge seeks to delay collection on the judgment until he exhausts his appeal rights. (See
Dkts. #55 and #56.) Trowbridge claims that he innocently understood that he could continue
to use his frivolous arguments to avoid payment of his millions of dollars in overdue liabilities
through the lengthy appeal process. Trowbridge further states that he is entitled to the stay
because he has spent 20 years of good faith exchanges with the Internal Revenue Service
14-20333.430
trying to resolve his tax debt. (Dkt. #56 at 1.) This statement is a patently false statement since
all exchanges were nothing more than frivolous arguments rejected by every court in the
country, including this Court, and only meant to delay collection over his 20-year history of
evasion.
A party seeking a stay pending an appeal must show: (1) likelihood of success on the
merits, (2) irreparable injury if the stay is not granted, (3) absence of substantial harm to the
other parties from granting the stay, and (4) service to the public interest from granting the stay.
E.g., Hunt v. Bankers Trust Co., 799 F.2d 1060, 1067 (5th Cir. 1986)(emphasis added).
Trowbridges request for stay fails all four elements.
Trowbridge has no likelihood of success on the merits. The amounts at issue were
previously determined as due and owing by the Tax Court and reaffirmed by this Court. (Dkt.
#53.) Trowbridge made his jurisdictional objections three times and they were all denied by this
Court. The United States has a statutory right to foreclose against real property owned by
Trowbridge to pay the long overdue tax debt. See 26 U.S.C. 7403. 28 U.S.C. Section 2001(a)
empowers the Court to set the terms and conditions of a sale of real property that is sold under
any decree or order of the Court. The Court has broad discretion in setting the terms and
conditions of a sale under 28 U.S.C. 2001. United States v. Branch Coal Corp., 390 F.2d 7, 10
(3d Cir. 1968), cert. denied, 391 U.S. 966 (1968); United States v. Heasley, 283 F.2d 422, 426
(8th Cir. 1960); United States v. Hunwardsen, 39 F.Supp.2d 1157, 1163 (N.D. Iowa 1999).
Trowbridge alleges irreparable injury from denying the stay because it would wreak
havoc on his personal and professional life, but doesnt show how this is any more disruptive
now than following appeal. A stay merely delays the inevitable since there is no non-frivolous
argument against foreclosure. Further, Trowbridge has known since 2003 that the Tax Court held
U.S. Opposition to Motion for Stay
Page 2 of 5
14-20333.431
against him and his frivolous arguments and that the Government was free to seek collection
from all income sources.
The United States has a paramount interest in collecting tax liabilities. The public
interest is served by allowing the tax debt to be paid rather than allowing Trowbridge to continue
his scheme to avoid collection and possibly decrease the property value by failing to pay
property taxes, insurance, adequately maintain the home, or intentionally or unintentionally
damaging the home during a stay. Further delay in collection of Trowbridges tax liabilities only
serves to protect his interest, and there is absolutely no service to the public interest by
permitting a stay in this case.
Further, Fed. R. Civ. Proc. 62(d) provides that an appellant may obtain a stay by giving a
supersedeas bond and that the stay is only effective when the supersedeas bond is approved by
the court. The United States requests that this Court only grant a stay to Trowbridge if he posts a
supersedeas bond in an amount equal to 120% of the judgment amount (i.e. $3,991,218.01) to
cover interest, which will continue to accrue on these tax liabilities pending appeal.
Trowbridge has remained on this property for years despite owing over $3 million in
back taxes. The time has come for Trowbridge to pay what he owes through foreclosure and sale
of his property. A forced sale in a soft real estate market is difficult enough and, even with the
best price, will not fully pay what is owed. The United States is entitled to prepare this property
for sale, and Trowbridges continued occupancy during an appeal is highly prejudicial to the
United States interests, completely unjustified, and should be denied.

Page 3 of 5
14-20333.432
CONCLUSION
For the foregoing reasons, the United States respectfully requests this Court to deny the
requested stay and allow the United States to proceed with the preparation and sale of the
property as ordered by the Court.
DATE:
May 28, 2014
KENNETH MAGIDSON
/s/ Joshua Smeltzer
JOSHUA D. SMELTER
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)

Page 4 of 5
14-20333.433
TO MOTION FOR STAY PENDING APPEAL, was served via ECF Filing and/or
United States Mail, postage pre-paid, as follows:
25117 Ramrock Dr.
Porter, TX 77365
9816 Memorial Boulevard, #205
Humble, Texas 77338
25117 Ramrock Dr.
Porter, TX 77365
Lori Gruver
Austin, TX 78760
JOSHUA D. SMELTZER

Page 5 of 5
14-20333.434
14-20333.435

HOUSTON DIVISION

Plaintiff,
v.
Case No.: 4:14cv00027


Defendant.
Official Transcript Filed

An official transcript has been filed. It may contain information protected from public disclosure by law.
See EGovernment Act of 2002, Fed. R. Civ. P. 5.2(a) or Fed. R. Crim. P. 49.1(a).
Ninety days after a transcript has been filed, it will be electronically available to the public on PACER. To
comply with the rules on privacy, the parties must redact protected information before it is available on
PACER.
If redaction is needed, the parties must file a statement listing the items to be redacted, with the transcript's
docket number and the item's location by page and line. It must be filed within 21 days of the transcript
being filed. A suggested form is at www.txs.uscourts.gov.
Only these portions of data may be visibile:
Last four digits of a social security number or taxpayer identification number;

Year of a person's birth;
Initials of a minor's name;
Last four digits of an account number; and
City and state of a home address in criminal cases.
Additional redactions require a separate motion and court approval.

A party may view the transcript at the public terminals in the clerk's office or buy it through
www.txs.uscourts.gov or by calling (713) 2505500 . A party is only responsible for reviewing the:
Opening and closing statements made for his party;

Statements by his party;
Testimony of witnesses called by his party; and
Other parts ordered by the court.
Redaction is your responsibility. The court, clerk, court reporter, or transcriber will not review this transcript
for compliance.
David J. Bradley, Clerk
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HOUSTON DIVISION
v.
John Parks Trowbridge, Jr et al
CASE NUMBER: 4:14cv27

District Judge: Lynn N Hughes
Court Reporter(s):
NOTICE OF THE FILING OF AN APPEAL

In connection with this appeal, instrument # 55, filed by John Parks Trowbridge, Jr, a copy of the
notice of appeal, the order being appealed and the docket sheet are attached.
In regard to this appeal:
The Court of Appeal $505.00 filing and docketing fees have been paid or a motion
for in forma pauperis has been granted.
Hearings were held in the case - transcripts were produced.
David Bradley, Clerk
14-20333.488

HOUSTON DIVISION
v.
John Parks Trowbridge, Jr et al
CASE NUMBER: 4:14cv27

District Judge: Lynn N Hughes
Court Reporter(s):
NOTICE OF THE FILING OF AN APPEAL

In connection with this appeal, instrument # 55, filed by John Parks Trowbridge, Jr, a copy of the
notice of appeal, the order being appealed and the docket sheet are attached.
In regard to this appeal:
The Court of Appeal $505.00 filing and docketing fees have been paid or a motion
for in forma pauperis has been granted.
Hearings were held in the case - transcripts were produced.
David Bradley, Clerk
14-20333.489
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DC CM/ECF LIVE- US District Court-Texas Southern

Page 1 of 7
APPEAL,APPEAL_NAT
U.S. District Court

SOUTHERN DISTRICT OF TEXAS (Houston)
CIVIL DOCKET FOR CASE #: 4:14-cv-00027
Internal Use Only
United States Of America v. Trowbridge, Jr. et al

Assigned to: Judge Lynn N. Hughes
Demand: $3,286,335,000
Cause: 26:7401 IRS: Tax Liability
Date Filed: 01/07/2014

Jury Demand: None
Nature of Suit: 870 Taxes
Jurisdiction: U.S. Government Plaintiff
Plaintiff
represented by Joshua David Smeltzer

United States Department of Justice,
TAX Division
717 N. Harwood Street
Suite 400
Dallas, TX 75201
214-880-9735
Fax: 214-880-9741
Email: joshua.d.smeltzer@usdoj.gov
ATTORNEY TO BE NOTICED
V.
Defendant
represented by John Parks Trowbridge, Jr.

9816 Memorial Blvd #205
Humble, TX 77338
PRO SE
Defendant
Defendant
Montgomery County Tax Office
Date Filed
represented by Lori Gruver

Linebarger Goggan et al
PO Box 17428
Suite 400
Austin, TX 78760
512-447-6675
Email: LoriG@lgbs.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
Docket Text
14-20333.496
https://ecf-d.txs.circ5.dcn/cgi-bin/DktRpt.pl?434715632792137-L_1_0-1
6/5/2014

Page 2 of 7
01/07/2014
COMPLAINT against All Defendants filed by United States Of

America. (Attachments: # 1 Exhibit Gov A, # 2 Civil Cover Sheet, # 3
Certificate of Interested Parties)(Smeltzer, Joshua) (Entered:
01/07/2014)
01/07/2014
CERTIFICATE OF INTERESTED PARTIES by United States Of

America, filed.(Smeltzer, Joshua) (Entered: 01/07/2014)
01/07/2014
Request for Issuance of Summons as to All Defendants, filed.

(Attachments: # 1 Summons Freedom Ventures, UBO, # 2 Summons
Montgomery Tax Office)(Smeltzer, Joshua) (Entered: 01/07/2014)
01/08/2014
ORDER FOR CONFERENCE. Initial Conference set for 4/7/2014 at

09:30 AM in Room 11122 before Judge Lynn N. Hughes(Signed by
Judge Lynn N. Hughes) Parties notified.(smurdock, 4) (Entered:
01/08/2014)
01/08/2014
Summons Issued as to Freedom Ventures, UBO, Montgomery County

Tax Office, John Parks Trowbridge, Jr. mailed to attorney, filed.
(smurdock, 4) (Entered: 01/08/2014)
01/08/2014
Summons Issued as to Freedom Ventures, UBO, Montgomery County

Tax Office, John Parks Trowbridge, Jr., filed.(jdav, 4) (Entered:
01/08/2014)
01/24/2014
RETURN of Service of SUMMONS Executed as to John Parks

Trowbridge, Jr. served on 1/15/2014, answer due 2/5/2014, filed.
(Smeltzer, Joshua) (Entered: 01/24/2014)
01/24/2014
RETURN of Service of SUMMONS Executed as to Freedom Ventures,

UBO served on 1/15/2014, answer due 2/5/2014, filed.(Smeltzer,
Joshua) (Entered: 01/24/2014)
01/24/2014
RETURN of Service of SUMMONS Executed as to Montgomery

County Tax Office served on 1/15/2014, answer due 2/5/2014, filed.
02/04/2014
CERTIFICATE OF INTERESTED PARTIES by Montgomery County

Tax Office, filed.(Gruver, Lori) (Entered: 02/04/2014)
02/04/2014
ANSWER to 1 Complaint by Montgomery County Tax Office, filed.

(Gruver, Lori) (Entered: 02/04/2014)
02/04/2014
10
CLAIM of Montogmery County Tax Office filed by Montgomery County

Tax Office. (Attachments: # 1 Exhibit 1)(Gruver, Lori) (Entered:
02/04/2014)
02/13/2014
12
Conditional Acceptance and Demand for Proof or Withdrawal of Claims

by John Parks Trowbridge, Jr., filed. (Attachments: # 1 Letter to
Kenneth Magidson)(jtabares, 1) (Entered: 02/14/2014)
02/14/2014
11
NOTICE of Defendant's Offer to Settle by John Parks Trowbridge, Jr.,

filed. (vcantu, 5) (Entered: 02/14/2014)
03/04/2014
13
ORDER on Conditional Acceptance. The court will construe the

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Page 3 of 7
conditional acceptance and demand for proof by John Parks Trowbridge,

Jr., as his answer to the lawsuit. (Signed by Judge Lynn N. Hughes)
Parties notified. (ghassan, 4) (Entered: 03/05/2014)
03/12/2014
14
REQUEST for Entry of Default against Freedom Ventures, UBO by

United States Of America, filed. (Attachments: # 1 Proposed Order
Default Judgment)(Smeltzer, Joshua) (Entered: 03/12/2014)
03/13/2014
15
NOTICE of Plaintiff's Failure to Demonstrate Personal or Subject-Matter

Jurisdiction of the Court in this case by John Parks Trowbridge, Jr., filed.
(sbejarano, 1) (Entered: 03/14/2014)
03/14/2014
16
ORDER Denying Entry of Default. John Parks Trowbridge, Jr., has

answered for himself and Freedom Ventures, UBO. The government's
request for entry of default is denied 14 . (Signed by Judge Lynn N.
Hughes) Parties notified. (ghassan, 4) (Entered: 03/18/2014)
03/18/2014
17
Defendant's NOTICE of Plaintiff's Failure to Demonstrate Personal

Jurisdiction Over Defendant or Subject-Matter Jurisdiction Over the
Property Upon Which the United States Seeks to Foreclose Its Lien by
John Parks Trowbridge, Jr., filed. (sgonzalez, 5) (Entered: 03/19/2014)
03/19/2014
18
MOTION to Dismiss 1 Complaint; RESPONSE in Opposition to 14

Request by John Parks Trowbridge, Jr., filed. Motion Docket Date
4/9/2014. (sbejarano, 1) Modified on 4/4/2014 (sbyrum, 4). (Entered:
03/20/2014)
04/04/2014
19
MOTION for Summary Judgment United States' Motion for Summary

Judgment and Memorandum in Support by United States Of America,
filed. Motion Docket Date 4/25/2014. (Attachments: # 1 Exhibit Gov Ex
A, # 2 Exhibit Gov Ex B-1, # 3 Exhibit Gov Ex B-2, # 4 Exhibit Gov Ex
B-3, # 5 Exhibit Gov Ex B-4, # 6 Exhibit Gov Ex B-5, # 7 Exhibit Gov
Ex C-1, # 8 Exhibit Gov Ex C-2, # 9 Exhibit Gov Ex D, # 10 Exhibit
Gov Ex E, # 11 Proposed Order Order)(Smeltzer, Joshua) (Entered:
04/04/2014)
04/07/2014
20
Minute Entry for Initial CONFERENCE held before Judge Lynn N.

Hughes on 4/7/2014. Argument heard on all pending motions. Order to
be entered. Internal review set for 4/28/2014. Appearances: Joshua
Smeltzer, John Trowbridge. (Court Reporter: F. Warner) (ghassan, 4)
(Entered: 04/07/2014)
04/07/2014
21
Management ORDER. By 4/28/2014, Trowbridge and Freedom

Ventures must respond to the government's motion for judgment. The
government must promptly give the court one of the objectionable tax
returns. (Signed by Judge Lynn N. Hughes) Parties notified. (ghassan, 4)
(Entered: 04/08/2014)
04/09/2014
22
RESPONSE to 18 MOTION to Dismiss United States' Opposition to

Motion to Dismiss, filed by United States Of America. (Smeltzer,
04/14/2014
***Delivery Confirmation; delivery date(s) 4/9/2014 re: 23 Document(s)
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Page 4 of 7
Sent, filed. (jdav, 4) (Entered: 04/14/2014)

04/14/2014
24
SUPPLEMENT to 19 MOTION for Summary Judgment United States'

Motion for Summary Judgment and Memorandum in Support, 21 Order,
by United States Of America, filed. (Attachments: # 1 Exhibit Gov Ex F)
04/23/2014
25
RESPONSE in Opposition to 19 MOTION for Summary Judgment

United States' Motion for Summary Judgment and Memorandum in
Support, filed by John Parks Trowbridge, Jr.. (Attachments: # 1
Proposed Order)(smurdock, 4) linked to entry 18 in error Modified on
4/29/2014 (smurdock, 4). (Entered: 04/23/2014)
04/24/2014
26
Order: Hearing set for 5/21/2014 at 10:00 AM at Courtroom 11C before

Judge Lynn N. Hughes. (Signed by Judge Lynn N. Hughes) Parties
notified. (ghassan, 4) (Entered: 04/24/2014)
04/29/2014
***Delivery Confirmation; delivery date(s) 4/25/2014 re: 27 Document

(s) Sent, filed. (jdav, 4) (Entered: 04/29/2014)
04/29/2014
28
Amended RESPONSE in Opposition to 19 MOTION for Summary

Judgment United States' Motion for Summary Judgment and
Memorandum in Support, filed by John Parks Trowbridge, Jr..
(Attachments: # 1 Proposed Order)(smurdock, 4) (Entered: 04/29/2014)
04/30/2014
29
STIPULATION re: Ad Valorem Taxes by Montgomery County Tax

Office, filed.(Gruver, Lori) (Entered: 04/30/2014)
04/30/2014
30
TRANSCRIPT re: Hearing held on April 7, 2014 before Judge Lynn N.

Hughes. Court Reporter/Transcriber FWarner. Ordering Party
JTrowbridge Release of Transcript Restriction set for 7/29/2014., filed.
(fwarner, ) (Entered: 04/30/2014)
05/01/2014
31
Notice of Filing of Official Transcript as to 30 Transcript. Party notified,

filed. (olindor, 4) (Entered: 05/01/2014)
05/01/2014
32
REQUEST for Production of Corroborating Evidence or Correction of

the Record by John Parks Trowbridge, Jr., filed.(mmapps, 4) (Entered:
05/01/2014)
05/01/2014
33
Request for Ruling on Defendant's March 19, 2014, Motion to Dismiss

by John Parks Trowbridge, Jr., filed. Motion Docket Date 5/22/2014.
(mmapps, 4) (Entered: 05/01/2014)
05/02/2014
34
ORDER Denying Production and Dismissal. Terminating 18 , [ 32], 33 .

(Signed by Judge Lynn N. Hughes) Parties notified.(rsmith, 4) (Entered:
05/02/2014)
05/06/2014
36
MOTION to Dismiss for Lack of Subject-Matter Jurisdiction;

Memorandum in Support by John Parks Trowbridge, Jr., filed. Motion
Docket Date 5/27/2014. (Attachments: # 1 Proposed Order)(amireles, 2)
(Entered: 05/06/2014)
05/07/2014
37
MOTION to Dismiss and Memorandum in Support by John Parks
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Page 5 of 7
Trowbridge, Jr., filed. Motion Docket Date 5/28/2014. (jdav, 4)

(Entered: 05/07/2014)
05/08/2014
38
AFFIDAVIT Concerning Allegation in the Record of this Cause that

Defendant Argued Pending Motion at Initial of John Parks Trowbridge,
Jr, filed.(mmapps, 4) (Entered: 05/08/2014)
05/08/2014
39
Request for Explanation of the Reason for the Court's Denial of

Defendant's March 19, 2014, Motion to Dismiss by John Parks
Trowbridge, Jr., filed.(mmapps, 4) (Entered: 05/08/2014)
05/12/2014
40
RESPONSE in Opposition to 37 MOTION to Dismiss, filed by United

States Of America. (Smeltzer, Joshua) (Entered: 05/12/2014)
05/12/2014
***Delivery Confirmation; delivery date(s) 5/6/2014 re: 35 Document(s)

Sent, filed. (jdav, 4) (Entered: 05/12/2014)
05/13/2014
41
Unopposed MOTION by Montgomery County Tax Office to Permit

thier Attorney to be Excused from Attending the Conference Set May
21, 2014 by Montgomery County Tax Office, filed. Motion Docket Date
6/3/2014. (Attachments: # 1 Proposed Order)(Gruver, Lori) (Entered:
05/13/2014)
05/13/2014
42
Second ORDER Denying Dismissal. This court has jurisdiction. The

motions to dismiss by Trowbridge, Jr., are denied 36 , 37 , 39 . (Signed
by Judge Lynn N. Hughes) Parties notified. (ghassan, 4) (Entered:
05/13/2014)
05/14/2014
44
ORDER. Unless the court specifically orders otherwise, counsel for the
Montgomery Tax Office is excused from attending hearings in this case
41 . (Signed by Judge Lynn N. Hughes) Parties notified. (ghassan, 4)
(Entered: 05/14/2014)
05/15/2014
45
Defendant's Formal Challenge of Jurisdiction by John Parks Trowbridge,

Jr., filed.(mmapps, 4) (Entered: 05/15/2014)
05/15/2014
46
Defendant's Notice of Defendant's Exclusive Reliance, Re the Question

of Jurisdiction in the Instant Cause, upon the Meaning of United States
as Defined by Congress by John Parks Trowbridge, Jr., filed.(mmapps,
4) (Entered: 05/15/2014)
05/15/2014
47
Defendant's Second Offer to Discharge in full the Tax Liability Alleged

in this Cause upon Plaintiff's Demonstration that Defendant is a Citizen
of Resident of the United States by John Parks Trowbridge, Jr., filed.
(mmapps, 4) (Entered: 05/15/2014)
05/16/2014
48
RESPONSE to 45 Document United States' Opposition to Formal

Challenge of Jurisdiction, filed by United States Of America. (Smeltzer,
05/20/2014
05/20/2014

49
OBJECTIONS to 42 Order on Motion to Dismiss,, filed by John Parks
14-20333.500
6/5/2014

Page 6 of 7
Trowbridge, Jr.. (amireles, 2) (Entered: 05/21/2014)

05/20/2014
50
Defendant's Objections to Denial of Due Process of Law, filed by John

Parks Trowbridge, Jr.. (vcantu, 5) (Entered: 05/21/2014)
05/21/2014
51
Minute Entry for HEARING held before Judge Lynn N. Hughes on

5/21/2014. Argument heard on all pending motions. Order to be entered.
Internal review set for 6/2/2014. Appearances: Joshua Smeltzer. (Court
Reporter: K. Metzger) (ghassan, 4) (Entered: 05/22/2014)
05/22/2014
52
FINAL JUDGMENT. The United States: takes $3,326,015.01, plus

statutory additions accruing after 4/7/2014, from John P. Trowbridge
including his assumed name Freedom Ventures, UBO; has tax liens on
Trowbridge's property, including 25117 Ramrock Drive, Porter, Texas
77365; may forclose its liens against 25117 Ramrock Drive. The clerk
will leave the case open for the court to supervise Trowbridge's eviction.
(Signed by Judge Lynn N. Hughes) Parties notified. (ghassan, 4)
(Entered: 05/22/2014)
05/23/2014
53
Amended FINAL JUDGMENT. The United States: Takes

$3,326,015.01, plus statutory additions accruing after 4/7/2014, from
John P. Trowbridge including his assumed name Freedom Ventures,
UBO; Has tax liens on Trowbridge's property, including 25117 Ramrock
Drive, Porter, Texas 77365; May forclose its liens against 25117
Ramrock Drive; Has all right, title, and interest in the property including
the right to possession. The clerk will leave the case open for the court to
supervise Trowbridge's eviction. (Signed by Judge Lynn N. Hughes)
Parties notified. (ghassan, 4) (Entered: 05/23/2014)
05/23/2014
54
ORDER of Sale and Vacature. Internal review set for 6/9/2014. (Signed
by Judge Lynn N. Hughes) Parties notified. (ghassan, 4) (Entered:
05/23/2014)
05/27/2014
55
NOTICE OF APPEAL to US Court of Appeals for the Fifth Circuit re:

53 Final Judgment,, by John Parks Trowbridge, Jr. (Filing fee $ 505),
filed.(cfelchak, 4) (Entered: 05/27/2014)
05/27/2014
Confirmation of receipt of payment from John Trowbridge in the amount

of $ 505.00 re: 55 Notice of Appeal. Receipt date: 5/27/2014. Receipt
number Hou045627. Purpose Description: Filing Fee. (cfelchak, 4)
(Entered: 05/27/2014)
05/27/2014
56
DEFENDANT'S EMERGENCY MOTION to Stay of Execution of

Order of Sale and Vacature by John Parks Trowbridge, Jr., filed. Motion
Docket Date 6/17/2014. (cfelchak, 4) Modified on 5/27/2014 (cfelchak,
4). (Entered: 05/27/2014)
05/27/2014
60
ORDER Denying Stay. The motion to stay the order of sale and vacature
is denied 56 . (Signed by Judge Lynn N. Hughes) Parties notified.
(ghassan, 4) (Entered: 05/28/2014)
05/28/2014
57
TRANSCRIPT re: Hearing held on 5/21/2014 before Judge Lynn N.

Hughes. Court Reporter/Transcriber K. Metzger. Ordering Party John
14-20333.501
6/5/2014

Page 7 of 7
Trowbridge, Jr. Release of Transcript Restriction set for 8/26/2014, filed.

(kmetzger) (Entered: 05/28/2014)
05/28/2014
58
Defendant's Recognition of Mistake; Apology Therefor; Affidavit in

Support; Provision of Completed Instrument and Request for Inclusion
re: 12 by John Parks Trowbridge, Jr., filed.(mmapps, 4) (Entered:
05/28/2014)
05/28/2014
59
RESPONSE in Opposition to 56 MOTION to Stay, filed by United

States Of America. (Smeltzer, Joshua) (Entered: 05/28/2014)
05/29/2014
63
Copy of Petition for Emergency Writ filed with the Fifth Circuit Court of
Appeals by John Parks Trowbridge, Jr., filed. (ghassan, 4) (Entered:
06/02/2014)
05/30/2014
62
Notice of Filing of Official Transcript as to 57 Transcript. Party notified,

filed. (hcarr, 4) (Entered: 05/30/2014)
06/02/2014

14-20333.502
6/5/2014
14-20333.503
14-20333.504
14-20333.505
14-20333.506

HOUSTON DIVISION
Plaintiff,
v.
Defendants.
UNITED STATES STATUS REPORT

Pursuant to the Courts June 10, 2014, Order (Dkt. #66), the United States submits
this status report on the eviction of John Parks Trowbridge, Jr. (Trowbridge).
The Court ordered Trowbridge to vacate the property by noon on
June 6, 2014. (Dkt. #54 7.) Trowbridge filed motions with this Court and the Fifth
Circuit to stay the requirement that he vacate the property pending appeal. Both
motions for a stay were denied. (Dkts. #60 and #67.)
U.S. Marshal David Herrera and IRS Property Appraisal and Liquidation
Specialist (PALS) Sheila Kuykendall arrived at 12:25 pm on June 6, 2014, to conduct
the eviction of Trowbridge. Ms. Kykendall contacted the United States and informed us
that Trowbridge was removing his belongings and cooperating with the eviction. At
2:23 pm on June 6, 2014, the United States was informed by Ms. Kuykendall that
Trowbridge had completed removing all of his property and that she had changed the
locks and seized the property. At 3:15 p.m. on June 6, 2014, U.S. Marshal David Herrera
14-20333.507
contacted the United States to inform us that the eviction was complete and there were
no issues. Ms. Kuykendall is currently preparing the house for sale under the terms of
the Courts order of sale. (Dkt. #54.)
The United States has received Trowbridges new address, which is 22790
Highway 59 N #137, Kingwood, Texas 77339. A copy of this status report and all other
correspondence related to the sale of the property will be sent to this new address.
DATE:
June 11, 2014
KENNETH MAGIDSON
/s/ Joshua Smeltzer

JOSHUA SMELTER
Dallas, Texas 75201
(214) 880-9735
(214) 880-9741 (FAX)
U.S. Status Report

Page 2 of 3
14-20333.508
I certify that on June 11, 2014, the foregoing UNITED STATES STATUS
REPORT, was served via ECF Filing and/or United States Mail, postage pre-paid, as
follows:
22790 Highway 59 N #137
Kingwood, Texas
Lori Gruver
Austin, TX 78760
JOSHUA D. SMELTZER
U.S. Status Report

Page 3 of 3
14-20333.509
14-20333.510
14-20333.511
14-20333.512
14-20333.513

HOUSTON DIVISION
1
2
3
4
UNITED STATES OF AMERICA
VERSUS
*
*
*
*
*
CIVIL NO. H-14-0027

Houston, Texas
April 7, 2014
9:50 a.m.
7
8
9
HEARING
BEFORE THE HONORABLE LYNN N. HUGHES
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
For the United States:

Mr. Joshua David Smeltzer
United States Department of Justice,
Tax Division
717 N. Harwood Street
Suite 400
Dallas, Texas 75201
For the Defendant:
Mr. John Parks Trowbridge, Jr.
25117 Ramrock Dr.
Porter, Texas 77365
PRO SE
Court Reporter:
Fred Warner
Official Court Reporter
515 Rusk Avenue
Proceedings recorded by mechanical stenography, produced by
computer-aided transcription.
14-20333.514
THE COURT:
1
2
United States of America versus John
Parks Trowbridge, Jr.

Mr. Trowbridge?
3
4
MR. TROWBRIDGE:
THE COURT:
there.
Over
You don't want to sit with him.
MR. TROWBRIDGE:
Okay.
Your Honor, may I address the Court?
THE COURT:
Yes, sir.
Lean that towards you.
It
should work, but that's government equipment.

MR. TROWBRIDGE:
11
12
caution.
13
any meeting today.
14
Yes.
Why don't you come sit up close.
Sit over there.
10
I am here out of an abundance of
I am shocked and amazed that we are actually having
I had not had any real contact from the
15
plaintiff for sometime.
16
on Friday and found that this hearing was scheduled and that
17
the plaintiff was to let me know.
18
had no knowledge of a hearing from the plaintiff.
19
find it in the record, and I have, out of respect to the
20
Court and an abundance of caution --
21
22
23
24
THE COURT:
So I got a copy of the docket sheet
And I am shocked because I

I can't
Mr. Smeltzer, didn't you send the
January 8th order for conference?

MR. SMELTZER:
I believe that we did.
It's my
normal practice in cases like this -- sorry.
25
14-20333.515
THE COURT:
I don't care about your normal
practices, Mr. Smeltzer.
I only care whether you sent him
the notice like the order says.
MR. SMELTZER:
My instructions to my paralegal were
to mail all the copies to Mr. Trowbridge because I know he
doesn't receive ECF.
been regular mail, Your Honor.
I believe that was done.
THE COURT:
MR. SMELTZER:
THE COURT:
10
It would have
That's fine.
I'm sorry.
He doesn't want to try to get the mail
11
from the post office.
They're only open between 10:15 and
12
11:30 on odd-numbered Wednesdays, so they leave you a little
13
green receipt and say "try to find us" is what it says.

Well, we're here.
14
MR. TROWBRIDGE:
15
You did the right thing.
Thank you, Your Honor.
I just was
16
shocked to find that you wanted to see me, and I am here for
17
you.
18
THE COURT:
All right.
And I take it you didn't
19
tell Ms. Gruver with the Montgomery tax office either.
20
is not here.
21
MR. SMELTZER:
22
THE COURT:
23
She
No.
I think we are going to take away your
paralegal and make you do it all yourself.
24
MR. SMELTZER:
25
THE COURT:
Right.
And you understand if, in fact, your
14-20333.516
paralegal made a mistake, that represents one of two things:
bad leadership or bad training, which are your
responsibility; and besides, it's your name on the case.

MR. SMELTZER:
4
5
I will take complete responsibility
if it wasn't mailed, and I apologize, Your Honor.

THE COURT:
I'm sorry I didn't get another
memorandum.
call the Guard's Regiments Tie.
MR. SMELTZER:
10
Apparently you both have on what some people
I'm sorry, Your Honor.
I don't
understand.
THE COURT:
11
12
Well, the tie you have and that he has
on is the regimental, for the Guard's Regiment in London.
13
MR. TROWBRIDGE:
14
THE COURT:
Thank you, sir.
However, in my family, that's the St.
15
Francis Episcopal Day School tie.
16
them, went there; and they were thrilled, each in their turn
17
as they got old enough to sort through my ties and see what
18
was going on, to find that I had a St. Francis Episcopal Day
19
School tie.
Montgomery County.
22
MR. SMELTZER:
23
THE COURT:
24
25
My grandsons, three of
Well, we don't need the tax office for
20
21
No, Your Honor.
But they should have been told about the
party.
MR. SMELTZER:
Yes.
If they haven't been, I'm
14-20333.517
sorry.
THE COURT:
All right.
MR. SMELTZER:
Now --
Your Honor, I did bring with me
today, we filed on Friday a motion for summary judgment.
provided Mr. Trowbridge a copy this morning just in case it
hasn't been received by mail.
provide you with one as well.
THE COURT:
MR. SMELTZER:
10
But if I can approach, I can
Certainly.
I just thought it would be convenient
for today.
11
THE COURT:
12
MR. TROWBRIDGE:
13
THE COURT:
14
Mr. Trowbridge.
Your Honor.
I have read some of your stuff.
What's your education?
15
MR. TROWBRIDGE:
16
THE COURT:
17
MR. TROWBRIDGE:
I am a physician.
What particular kind?

I practice alternative type of
18
medicine when people are sick and tired of the drugs and the
19
surgeries, sir.
20
THE COURT:
21
MR. TROWBRIDGE:
22
23
So is that holistic?
That would be holistic or
integrated medicine, Your Honor.

THE COURT:
Doctor, this is serious business; and as
24
you can see, the government just got right on this.
25
dealing with the tax years '93 to '97.
We're
14-20333.518
MR. TROWBRIDGE:
THE COURT:
Yes, Your Honor.
So they just jumped right on it.
They're not as bad as the Education Department.
collected student loan cases that have been delinquent since
the second year the statute was in effect, 1966.

But here we are.
6
7
sent me.
that's a good idea.
I've
I have read the things you've
I don't know where you're getting the advice that
Do you know Dr. Jaikaran?
9
10
MR. TROWBRIDGE:
11
THE COURT:
I know Dr. Jaikaran.
Okay.
It didn't help him.
He has been
12
to prison.
He spent all told probably eight months being
13
held in contempt because he wouldn't do what he was asked to
14
do; and most important, he wouldn't stop doing what he was
15
told not to do.

It's a free country, so you are entitled -- you
16
17
can get your advice from anybody you want to.
Jaikaran's
18
lost his medical license, he's gone to prison for nine months
19
or something under Judge Lake, and probably longer than that
20
in total, because I let him out to see if he would act right,
21
and he wouldn't.
And I don't like putting him in jail.
22
But if
23
you don't do what I say or not do what I say, then I have to
24
do that.
25
That's the only alternative I have.

In this case the government says you owe the
14-20333.519
taxes.
took the stuff you filed as an answer?
Did you seek -- did you get my order saying that I
MR. TROWBRIDGE:
THE COURT:
Yes, I did, Your Honor.
Good.
It's not really an answer, but
you're not a lawyer; and so, what I did was pretend what you
said in these papers was "the government's wrong."

Apparently the government has some evidence
7
8
that you earned enough money that you should have reported
the income.
You know, they get upset if you don't file a
10
return even if you don't owe taxes.
11
those six years that you didn't pay about
12
three-and-one-quarter million dollars in taxes.
13
And so, they say for
If there is an answer to that, it is something
14
other than the stuff you filed.
15
I resent it when they use the phrase Republic of Texas
16
people, when they talk this.
17
The sovereign citizen stuff,
The Republic was a real thing and a very fine
18
real thing, but it merged with America in 1845; and these
19
people claiming to be the Republic of Texas are cranks who
20
are delusional.
21
You need to address the problem.
If there is
22
not an answer, that is, a real world answer, then you
23
probably ought to try to work something out with Mr. Smeltzer
24
to address some of the taxes.
25
This book he handed you is the government's
14-20333.520
saying, even if you said "no," here are the facts; and as a
matter of law, that is, there is no dispute about the facts.
You are going to owe the money.
it was just delivered.
I haven't read it.
You saw
You have 21 days to respond to that to explain
5
6
to me in writing why it's wrong.
now to tell me why you think you shouldn't pay taxes on your
income?
MR. TROWBRIDGE:
But would you like briefly
Your Honor, I believe the evidence
10
of record speaks to the question.
11
the plaintiff's arguments and said simply I'm not aware of
12
what makes me liable as a United States citizen or resident
13
and asked for their proof of their claim.
14
that they've answered that.
15
THE COURT:
16
MR. TROWBRIDGE:
17
18
I accepted conditionally
And I am unaware
Well, apparently they did.

I just found out about that motion
on Friday also, Your Honor.

THE COURT:
I just found out now.
But, Mr. Trowbridge, that's sort of not exactly
19
20
how it works.
21
you earned no income in those six years or the government
22
doesn't have authority to tax it or both.
23
And I don't understand whether you are saying
MR. TROWBRIDGE:
Your Honor, I really did not come
24
to testify or to challenge the facts today.
25
of respect for you.
I showed up out
14-20333.521
THE COURT:
1
2
badger you.
Well, the reason you show up is so I can
That's what happens to him every time.
MR. SMELTZER:
THE COURT:
That's why I'm here.
Having fortified himself.
My question is:
Are you claiming the facts
don't support that you earned no money or are you claiming
that even if you did, the government has not properly done
whatever it needs to do to be able to collect taxes on it?

MR. TROWBRIDGE:
Your Honor, I honestly don't
10
understand beyond what I've offered in my conditional
11
acceptance and am not really prepared to go further.

THE COURT:
12
Well, Doctor, the conditional acceptance
13
is categorically wrong.
14
Uniform Commercial Code.
15
and things but with drafts, checks.
16
misconceived.
17
somebody has told you:
That's a phrase taken from the

It has to do not with court orders
It is entirely
And not by you -- you don't understand it, but

You just say this.
Jaikaran's got a rubber stamp he used to stamp
18
19
my orders and said something "dishonored" or "offer
20
accepted," some mumbo jumbo; but it comes out of the Uniform
21
Commercial Code.
22
check.
23
And a court order is not exactly like a
Checks are much better.

And so, it's like he's talking about
24
architecture and you're citing phrases and things that talk
25
about psychology.
They're both fields of law -- not those
14-20333.522
10
two, but our two, but they're completely different.
And the
word "order" means something else.
"order" can be used a number of ways by the sequence, and it
could be about telling somebody to do something.
what a check is.
Pay to the Order of.
order it paid to somebody else by signing the back.
not what you do with court orders.
Like all English words,
And that's
It's an order because it says to the bank:

And then whoever's name is in there can
That's
And so, if the answer to the motion for summary
9
10
judgment is similar, then the United States will win because
11
it will be, for all practical purposes, no answer; and then
12
they'll start collecting their judgment, our judgment
13
technically.
14
And I can't play games.
15
engage in this say that the -- Nineteenth Amendment,
16
Sixteenth?
17
MR. SMELTZER:
18
THE COURT:
Some of the people who
Sixteenth.
Sixteenth Amendment is invalid because
19
some of the states ratifying resolutions had typographical
20
errors in them.
21
I'm not a big fan of the Sixteenth Amendment
22
myself, but it's in the book; and even if there were
23
typographical errors in the book, it's in the book and we
24
know what it means.
25
So, there are constructive responses to this,
14-20333.523
11
and then there are responses like your friend Dr. Jaikaran.
And he had another doctor friend, Galliardi?
MR. TROWBRIDGE:
THE COURT:
Is that Gugliardi?
It could be.
My Italian is worse than
my English, and it's pretty bad.

Who was a very nice man, but he bought into
6
7
this stuff, and then he decided he wasn't going to respond to
court orders; and I had to deal more harshly with him than I
would have liked.

I can't do that.
10
I can't let somebody say, I
11
have a different vision of the world.
The law is kind of
12
like gravity.
13
and it affects you whether you believe in it or not.
It exists whether you believe in it or not,
And I would prefer -- it's a free country.
14
You
15
can approach this any way you want to, but one of the not as
16
often discussed aspects of a free country is you take the
17
consequences of your choices.

Today is the 7th.
18
So if you would please file
19
your response to the motion for summary judgment by Monday,
20
April 28th.
21
whether to have another conference or to simply decide on the
22
motions.
25
I will look at them and decide
Do you have any questions?
23
24
That's 21 days.
MR. TROWBRIDGE:
indulgence.
I appreciate Your Honor's
I honestly did not come expecting a hearing
14-20333.524
because I had no notification, and I was shocked to find
this.
So I am here out of respect to the Court, Your Honor.

THE COURT:
Well, you knew that's what we were going
to do.
have everybody in the room and not do anything, does it?
Once you did find out, it doesn't make much sense to
MR. TROWBRIDGE:
Well, I was shocked because I am
certainly not prepared to do anything.
pretrial contact with the plaintiff.

THE COURT:
9
10
12
I haven't had any
Well, I don't know whether you had
pre-suit contact with it.

MR. SMELTZER:
11
We did.
We sent him a pre-suit
12
letter based on the ruling on file for the reasons that we
13
received a -THE COURT:
14
A warm, friendly pre-suit letter, huh?
However shocked you may be, however irritated I
15
16
might be at Smeltzer about not giving you proper notice, you
17
know the man who earned the income, you know the man who
18
either didn't report it, didn't file anything or whatever he
19
did.
I need to know how it could be that they're
20
21
wrong.
And the government's wrong a lot.
But you're the
22
only person who knows.
23
somebody else.
24
made.
25
made something somewhere the way they did, and neither party
You don't have to go find out from
It's about you, what you did, the money you
A lot of cases you got to go find out why somebody
14-20333.525
13
has a clue, so you got to go take depositions and other
things like that.

Here standing before me is the repository of
3
4
all knowledge or the possessor of the documents that have
that knowledge.
not very complicated.
years.
10
It's
Even that they can't do for 15, 20
So, I'll take that as you have no questions?
8
9
And you know all they want is money.
MR. TROWBRIDGE:
Your Honor.
I have no questions at this time,
Thank you.
11
THE COURT:
Yes, sir.
Mr. Smeltzer.
12
MR. SMELTZER:
13
a lot of our arguments in there.
14
questions, what we have, I mean, the relief we are seeking is
15
the same as in our complaint.
16
THE COURT:
17
MR. SMELTZER:
We have submitted our motion.
It has
And if the Court has any
We're seeking --
Were returns filed?

They were, but they contained a
18
statement that essentially, that has these arguments saying
19
nothing was owed.
20
There were two tax -- his deficiency was
21
determined by the tax court.
22
opinions at P-1 and P-2.
23
24
25
THE COURT:
And I have copies of those
Well, did they bother to tell him about
the hearings in the tax court?

MR. SMELTZER:
I don't know, Your Honor.
14-20333.526
THE COURT:
MR. TROWBRIDGE:
THE COURT:
14
Did they?
Yes, Your Honor.
That's embarrassing.
The tax court
works better than we do.

MR. SMELTZER:
Your Honor, there were, for the years
that are at issue that are in our complaint, there was
deficiency hearings held, and those deficiencies were upheld
for the '93 to '97 tax years.

We also have in there copies of our liens.
The
10
only transfer that we are aware of was to the Freedom
11
Ventures Trust, but it occurred after our liens were already
12
filed.
13
liens.
So the trust would have taken those subject to our
THE COURT:
14
Have you looked up -- Freedom Ventures
15
Trust, is it just a common law trust or is it like a company
16
or a limited partnership or anything with the Secretary of
17
State?
18
19
20
MR. TROWBRIDGE:
Not with the Secretary of State.
It's an unincorporated business organization.

MR. SMELTZER:
Your Honor, essentially we believe
21
that there should be no dispute about the amounts owed only
22
because they have been decided previously.
23
our transcripts, but we will obviously hear whatever
24
responses Mr. Trowbridge has.
25
THE COURT:
And we do have
Mr. Trowbridge, what is Freedom Ventures
14-20333.527
1
2
3
UBO?
What is that?
MR. TROWBRIDGE:
THE COURT:
MR. TROWBRIDGE:
THE COURT:
MR. SMELTZER:
THE COURT:
familiar with that.
13
14
15
Ah.
Thank you.
Are you supposed to put that there?

I don't know.
I mean, it's fine.
I just wasn't
"Under the benefit of," and then there's
nothing else.
Do you have a copy of one of these
11
12
Unincorporated business
organization.
10
objectionable tax returns?

MR. SMELTZER:
I do not have them on me right now,
but I can get one for Your Honor.

THE COURT:
So it's the government's position that
16
he reported all the taxes and then just said "it doesn't
17
apply to me"?
18
MR. SMELTZER:
I know that he reported amounts owed
19
and then attached a statement saying that it was actually
20
zero for the reasons --
21
THE COURT:
22
MR. SMELTZER:
23
24
25
15
No.
I understand that.
I don't have it in front of me, so I
couldn't tell whether or not full amounts were done or not.

THE COURT:
exemplar.
Well, I would like just to see an
Just pick whatever the Service thinks is the most
14-20333.528
1
2
3
egregious statement.
You know, your client often attacks people for
writing "screw you" on a form and things like that.
MR. SMELTZER:
THE COURT:
I don't believe that was written.
And there is, in the same book with the
Fourteenth Amendment, the Sixteenth Amendment.
First Amendment that says we can say anything we want to.
That does not impede the collection of the tax.
clerk's feelings.
10
11
12
16
There is a
It hurt some
And sometimes they write "without prejudice"

under the signature.
I had a case, a guy claimed that it wasn't a
13
return -- and I said it was a return -- so they couldn't get
14
him for failure to file a return.
15
16
17
18
19
It was signed.
If he had written "without Thursday's garbage"

under his signature, it doesn't have any affect.
So I just want to make sure that your client
didn't get thuggy on us.
MR. SMELTZER:
All right, Your Honor.
We didn't
20
include those just because we didn't feel we needed to, but I
21
can get a copy.
22
THE COURT:
23
MR. SMELTZER:
24
THE COURT:
25
Well, just one.

I will.
And just the 1040, the first couple of
pages of it, plus whatever attachment that would affect
14-20333.529
1
2
liability.
MR. SMELTZER:
All right.
Would you like me to attach that and to reply?
3
4
THE COURT:
No.
I want you just to file it, and
redact his address and social security.
already on the case, so...
MR. SMELTZER:
Well, his name is
We have redacted all social security
numbers but for the last four, and the street address is on
the supplement.
10
THE COURT:
11
MR. SMELTZER:
12
THE COURT:
13
MR. SMELTZER:
14
THE COURT:
Okay.
Do that.
Just file one as --
A supplement.
-- the attachment the Court ordered.

Will do.
I just want to see what one looks like.
All right.
15
16
MR. SMELTZER:
17
THE COURT:
18
Do you have any questions?
I do not, Your Honor.
All right.
Well, you'll hear from me
sometime after the 28th.

And if you move, please tell me, because I
19
20
don't want to have to find you.
21
fellow that had not shown up as he was ordered to for the
22
third time.
23
there, he called and the secretary gave the Marshals the
24
phone, and he explained to the fellow why they were there.
25
17
And believe me, I had a
And they went by his office, and while they were
And the man repeated, "so you're like police;
14-20333.530
you're the Marshals?"
And they said, "yes, sir."
And he said, "all right.
18
and hung up.
Catch me if you can"
In an hour and 30 minutes he was down here.
MR. TROWBRIDGE:
THE COURT:
So they can.
They can do it.
I am glad the IRS is not as efficient as the
Marshal's Service because they're mean, and they might use
that efficiency in the wrong way, where I have never seen the
10
Marshals do that.
11
All right.
12
MR. TROWBRIDGE:
You will hear from me shortly.

Thank you, Your Honor.
13
14
15
(Conclusion of Proceedings)
16
17
18
19
20
21
22
23
24
25
14-20333.531
19
CERTIFICATION
1
2
3
4
I, Fred Warner, Official Court Reporter for the
5
6
United States District Court for the Southern District of
Texas, Houston Division, do hereby certify that the foregoing
pages 1 through 18 are a true and correct transcript of the
proceedings had in the above-styled and numbered cause before
10
the Honorable LYNN N. HUGHES, United States District Judge,
11
on the 7th day of April, 2014.

WITNESS MY OFFICIAL HAND at my office in Houston,
12
13
Harris County, Texas on this the 9th day of April, A.D.,
14
2014.
15
16
17
18
19
20
Fred Warner, CSR

21
22
23
24
25
14-20333.532

HOUSTON DIVISION
2
3
UNITED STATES OF AMERICA
VS.

et al
.
.
.
.
.
.
CA. NO. H-14-27

HOUSTON, TEXAS
MAY 21, 2014
10:25 A.M. to 10:35 A.M.
6
7
TRANSCRIPT of HEARING
BEFORE THE HONORABLE LYNN N. HUGHES
8
9
10
APPEARANCES:
11
FOR THE PLAINTIFF:
MR. JOSHUA D. SMELTZER

Tax Division
717 N Harwood Street
Suite 400
Dallas, Texas 75201
OFFICIAL COURT REPORTER:
MS. KATHY L. METZGER

U.S. Courthouse
515 Rusk
Room 8004
713-250-5208
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Proceedings recorded by mechanical stenography, transcript

produced by computer-aided transcription.
14-20333.533
P R O C E E D I N G S
THE COURT:
3
4
Thank you.
Please be seated.
Mr. Smeltzer, have you heard from Mr. Trowbridge,

other than by paper?
MR. SMELTZER:
I have not, only by paper.
To resolve
the problem that we had last time when he said he hadn't
received our regular mail, I did FedEx him a copy of this
notice.
9
10
THE COURT:
So did we.
MR. SMELTZER:
Oh.
Well, and I did see the ECF
11
notice, so I assumed, but just to double up, I made -- I wanted
12
to make sure he knew.
13
THE COURT:
And we called his office.
His office
14
manager said she thought he planned to come and she would call
15
his cell phone and call us back.
16
I think we need to go on.
17
MR. SMELTZER:
18
THE COURT:
19
MR. SMELTZER:
20
THE COURT:
That was 15 minutes ago.
So,
That's fine.
I think he just doesn't like you.

That's probably true, Your Honor.
But we have so many CSOs here is because I
21
told them they ought to come see you, see how you behave and
22
just for entertainment value.
23
MR. SMELTZER:
24
THE COURT:
25
Fair enough.
I have read Mr. Trowbridge's response and
I have not read yours, because I'm pretty sure you didn't raise
14-20333.534
any of those issues.
MR. SMELTZER:
THE COURT:
I did not, Your Honor.
But I conclude as a matter of law that
North Harris County is part of the United States.
period of three years during which Texas tried assiduously not
to be part of the United States, but it lost that argument and
in White versus Texas the Supreme Court held in 1869 or so,
that it had never left, which is -- seemed obvious to Abraham
Lincoln and me.
10
There was a
The United States is free to go by slang
11
nicknames if it chooses.
12
of America or the United States or USA or what as we say in
13
Texas, "Murica," that that's fine.
14
common names or official names.
15
Whether it goes by the United States
The rules allow pleading in
The confusion -- and I actually don't think
16
Trowbridge has a clue what all this means.
17
But he got it from somebody.
18
lives up there around Dr. Jaikaran.
19
approaches.
20
meaningless because he has no other way he thinks of avoiding
21
it, so -- or he's delusional and believes it.
22
your time being rational with an irrational purpose would be
23
irrational.
24
25
Frankly, you can't.
As I mentioned last time, he

And there are two
He's using it even though he probably knows it's
But by spending
So when do you want him evicted?

MR. SMELTZER:
I was prepared to give Mr. Trowbridge
14-20333.535
30 days if he needed it to gather his belongings.
if he -- sometimes people are less than willing to leave and we
are required to use the Marshal Service but --
THE COURT:
MR. SMELTZER:
I don't know
Well --- I thought that 30 days was
reasonable.
THE COURT:
-- the problem is the adverse decision by
the Board of Tax Appeals, which just pretends to be a court,
was June 4th, 2003.
So he's had 11 years.
10
MR. SMELTZER:
11
THE COURT:
That's true.
So you add up 30 days, plus 11 years that
12
he has known of the problem, has, as near as I know, done
13
nothing constructive by way of negotiation or payment or
14
anything else.
15
MR. SMELTZER:
16
THE COURT:
No, he has not.
And he has been obstreperous.
Because I
17
don't like calling people insane, I'll assume he's being
18
dishonest, I think that's a step up, in using all of this
19
stuff.
20
21
Today is the 21st of May.

be out by noon May 30th.
22
MR. SMELTZER:
23
THE COURT:
24
25
I believe he needs to
That is fine by me, Your Honor.
There is simply no sense in our allowing
him further to do it, that is, to occupy.

And have you talked to Montgomery County?
14-20333.536
MR. SMELTZER:
THE COURT:
MR. SMELTZER:
About the ad valorem?
Yes, sir.
Yes, we filed a stipulation.
We agree
with their ad valorem taxes coming ahead of ours to the extent
that they have --
THE COURT:
Oh, no, I didn't think you were going to
argue against the law.
MR. SMELTZER:
THE COURT:
10
No, no.
But is it your understanding that the
taxes have been paid up until this last year?
11
MR. SMELTZER:
They don't have any listed in their
12
pleadings as being owed and they said that -- I think,
13
though, they're holding that lien as a placeholder for, you
14
know, ones, if they're not paid.
15
the year --
16
17
18
19
20
21
22
THE COURT:
Okay.
Because at the beginning of
So you think they've been being
paid?
MR. SMELTZER:
I do.
I don't think that there's any
owed, but to the extent there are, we don't obviously disagree.

THE COURT:
All right.
And did you furnish me with a
draft order?
MR. SMELTZER:
I did on the motion for summary
23
judgment.
I do not have an order of sale.
I have one drafted,
24
which I can send the Court if you want me to.
25
waiting for the judgment first.
I was just
14-20333.537
1
2
THE COURT:
Did you send the title judgment in an
editable form?
3
4
MR. SMELTZER:
I don't believe I did, but I can, Your
Honor.
THE COURT:
you're going back to Dallas?
7
8
9
10
Will you send both of them?
MR. SMELTZER:
And I take it
Well, actually I scheduled depositions
so that I could double up the trip.

THE COURT:
Good.
MR. SMELTZER:
I have depos for the rest of the week,
11
but I do have my computer.
12
depo, I could file it.
This evening when I return from the
13
THE COURT:
14
could call and do it for you?
Isn't there somebody up there that you
15
MR. SMELTZER:
16
THE COURT:
I do have a paralegal, I could ask her.
Okay.
Since he's going to be on
17
reasonably short notice, I would like to get it done; and,
18
also, if I don't get it done, it may get sluffed off into the
19
large mass of other stuff.
20
21
MR. SMELTZER:
Certainly, Your Honor.
I'll call my
paralegal today and see if she can get that to the Court.
22
THE COURT:
Tell her to put the full legal title --
23
MR. SMELTZER:
24
THE COURT:
25
MR. SMELTZER:
Okay.
-- in the judgment.
Yes.
14-20333.538
THE COURT:
MR. SMELTZER:
THE COURT:
MR. SMELTZER:
THE COURT:
And, of course, I will edit it.

That's fair.
Because -What I will do --
-- what is uncommon perhaps for people in
my position, my practice consisted of about 30 percent of
old-fashion land law, so I take a keen interest in land titles.
MR. SMELTZER:
THE COURT:
10
A perhaps perverse interest in land
titles, not something a normal person would do.
11
12
All right.
MR. SMELTZER:
They are in Word format; is that
acceptable?
13
THE COURT:
Perfect.
14
MR. SMELTZER:
15
THE COURT:
Okay.
Because we can convert it.
16
Perfect guy, but it's convertible.
17
Perfect in Word mode.
18
MR. SMELTZER:
19
THE COURT:
20
MR. SMELTZER:
21
22
23
24
25
I'm a Word
You can actually do Word
Yeah.
All right.
Anything else you need?
No, not unless you need something from
me.
THE COURT:
It's out in Porter or Humble or some place
out there?
MR. SMELTZER:
I think his office is in Humble, but
the property is in Porter.
14-20333.539
THE COURT:
So I'm just assuming we'll need somebody
to go out and see whether he's vacated it and if not, evict
him.
MR. SMELTZER:
THE COURT:
Okay.
And are there some underemployed agents of
the Service who could go by once a day and check to see if
they've moved?
8
9
10
MR. SMELTZER:
I can have -- once I go back and the
orders are entered, someone from the Service will be assigned

to sell this property.
11
THE COURT:
Okay.
But I just want them to check, you
12
know, 10:00 o'clock every morning to see if somebody is still
13
there, because you don't want it vacant without it being
14
resecured and stuff, because of vandals and other stuff.
15
also, I want it promptly inspected as soon as he leaves,
16
because we may have to get together again if he does any damage
17
to the house.
18
MR. SMELTZER:
19
THE COURT:
20
And,
Yes, Your Honor.
I know that sounds strange, but it
happens.
21
MR. SMELTZER:
22
THE COURT:
23
MR. SMELTZER:
24
THE COURT:
25
MR. SMELTZER:
That doesn't sound strange.
All right.
Anything else?
That's all I have, Your Honor.
All right.
Thank you.
Thank you.
14-20333.540
(Concluded at 10:35 a.m.)
* * *
I certify that the foregoing is a correct transcript from the
record of proceedings in the above-entitled cause, to the best
of my ability.
6
7
8
/s/
Kathy L. Metzger
Date
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
14-20333.541

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Case 4:14-cv-00027 Document 1 Filed in TXSD on 01/07/14 Page 1 of 5

IN THE UNITED STATES DISTRICT COURT FOR THE

CIVIL NO. 4:14-cv-0027

U.S.C. '' 1340, and 1345.

Venue is proper pursuant to 28 U.S.C. '' 124(b) and 1396.

Plaintiff is the United States of America.

Case 4:14-cv-00027 Document 1 Filed in TXSD on 01/07/14 Page 2 of 5

unpaid federal income taxes, penalties, and interest:

Amount Due Through

Case 4:14-cv-00027 Document 1 Filed in TXSD on 01/07/14 Page 3 of 5

Case 4:14-cv-00027 Document 1 Filed in TXSD on 01/07/14 Page 4 of 5

Case 4:14-cv-00027 Document 1 Filed in TXSD on 01/07/14 Page 5 of 5

DATE: January 7, 2014

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 1 of 8

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 2 of 8

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 3 of 8

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 4 of 8

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 5 of 8

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 6 of 8

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 7 of 8

Case 4:14-cv-00027 Document 1-1 Filed in TXSD on 01/07/14 Page 8 of 8

Case 4:14-cv-00027 Document 1-2 Filed in TXSD on 01/07/14 Page 1 of 2

CIVIL COVER SHEET

United States of America

John Parks Trowbridge, Jr., Freedom Ventures, UBO, and

(IN U.S. PLAINTIFF CASES ONLY)

(c)$WWRUQH\V(Firm Name, Address, and Telephone Number)

II. BASIS OF JURISDICTION(Place an X in One Box Only)

III. CITIZENSHIP OF PRINCIPAL PARTIES (Place an X in One Box for Plaintiff

and One Box for Defendant)

IV. NATURE OF SUIT(Place an X in One Box Only)

PERSONAL INJURY

FEDERAL TAX SUITS

V. ORIGIN(Place an X in One Box Only)

VI. CAUSE OF ACTION

&LWHWKH86&LYLO6WDWXWHXQGHUZKLFK\RXDUHILOLQJ(Do not cite jurisdictional statutes unless diversity)

/s/ Joshua D. Smeltzer

Case 4:14-cv-00027 Document 1-2 Filed in TXSD on 01/07/14 Page 2 of 2

INSTRUCTIONS FOR ATTORNEYS COMPLETING CIVIL COVER SHEET FORM JS 44

Plaintiffs-Defendants.(QWHUQDPHV ODVWILUVWPLGGOHLQLWLDO RISODLQWLIIDQGGHIHQGDQW,IWKHSODLQWLIIRUGHIHQGDQWLVDJRYHUQPHQWDJHQF\XVH

Residence (citizenship) of Principal Parties.7KLVVHFWLRQRIWKH-6LVWREHFRPSOHWHGLIGLYHUVLW\RIFLWL]HQVKLSZDVLQGLFDWHGDERYH0DUNWKLV

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VIII. Related Cases.7KLVVHFWLRQRIWKH-6LVXVHGWRUHIHUHQFHUHODWHGSHQGLQJFDVHVLIDQ\,IWKHUHDUHUHODWHGSHQGLQJFDVHVLQVHUWWKHGRFNHW

Case 4:14-cv-00027 Document 1-3 Filed in TXSD on 01/07/14 Page 1 of 2

IN THE UNITED STATES DISTRICT COURT FOR THE

CIVIL NO. 4:14-cv-0027

UNITED STATES CERTIFICATE OF INTERESTED PARTIES

UNITED STATES OF AMERICA, through its agency the INTERNAL

JOHN PARKS TROWBRIDGE, JR.

FREEDOM VENTURES, UBO.

MONTGOMERY COUNTY TAX OFFICE.

Case 4:14-cv-00027 Document 1-3 Filed in TXSD on 01/07/14 Page 2 of 2

DATE: January 7, 2014

/s/ Joshua Smeltzer

U.S. Certificate of Interested Parties

Case 4:14-cv-00027 Document 2 Filed in TXSD on 01/07/14 Page 1 of 2

IN THE UNITED STATES DISTRICT COURT FOR THE

CIVIL NO. 4:14-cv-0027

UNITED STATES CERTIFICATE OF INTERESTED PARTIES

UNITED STATES OF AMERICA, through its agency the INTERNAL

JOHN PARKS TROWBRIDGE, JR.

FREEDOM VENTURES, UBO.

MONTGOMERY COUNTY TAX OFFICE.

&LWHWKH86&LYLO6WDWXWHXQGHUZKLFK\RXDUHILOLQJ(Do not cite jurisdictional statutes unless diversity)

Plaintiffs-Defendants.(QWHUQDPHVODVWILUVWPLGGOHLQLWLDORISODLQWLIIDQGGHIHQGDQW,IWKHSODLQWLIIRUGHIHQGDQWLVDJRYHUQPHQWDJHQF\XVH

Residence (citizenship) of Principal Parties.7KLVVHFWLRQRIWKH-6LVWREHFRPSOHWHGLIGLYHUVLW\RIFLWL]HQVKLSZDVLQGLFDWHGDERYH0DUNWKLV

Cause of Action.5HSRUWWKHFLYLOVWDWXWHGLUHFWO\UHODWHGWRWKHFDXVHRIDFWLRQDQGJLYHDEULHIGHVFULSWLRQRIWKHFDXVHDo not cite jurisdictional

VIII. Related Cases.7KLVVHFWLRQRIWKH-6LVXVHGWRUHIHUHQFHUHODWHGSHQGLQJFDVHVLIDQ\,IWKHUHDUHUHODWHGSHQGLQJFDVHVLQVHUWWKHGRFNHW