United States District Court, S.D. Indiana, Indianapolis Division
Jane Magntts-Stinson, United States District Court Chief
matter involves an action by the United States of America
(the “Government”) to collect unpaid
income tax liabilities and frivolous return penalties
assessed against Defendant Marzella Hiatt, and to enforce
federal tax liens on several properties located in Sheridan,
Indiana which secure those debts. On September 4, 2014, the
Court granted summary judgment and entered final judgment in
favor of the Government on all of the Government's
claims. [Filing No. 74; Filing No. 75.] The
Court now addresses two motions filed by Ms. Hiatt: (1) a
Motion to Void Judgment and Dismiss, [Filing No.
129]; and (2) a Motion to Cease and Desist - Dismiss,
[Filing No. 132].
to Void Judgment and Dismiss
Motion to Void Judgment and Dismiss, Ms. Hiatt appears to set
forth two main arguments: (1) that she is not a citizen or
resident of the United States, so is not subject to federal
tax laws; and (2) that she is not liable for taxes because
there is no statute that imposes tax liability and she has no
taxable income because she has never been engaged in a
“trade or business” and has no source of income
within the United States. [Filing No. 129.] The
Government argues in response that Ms. Hiatt's motion is
time-barred, and her arguments are meritless. [Filing No.
Court finds that Ms. Hiatt's Motion to Void Judgment and
Dismiss fails for three reasons. First, Ms. Hiatt is
represented by counsel,  yet has filed her motion pro
se. The Court may strike motions that are filed pro
se when the party is represented by counsel, and Ms.
Hiatt's Motion to Void Judgment and Dismiss could be
denied for that reason alone. See United States
v. Gwiazdzinski, 141 F.3d 784, 787 (7th Cir. 1998)
(“A defendant does not have an affirmative right to
submit a pro se brief when represented by counsel”).
The Court will, however, address two other grounds for
Ms. Hiatt's motion is untimely. Although Ms. Hiatt does
not set forth the rule under which she brings her motion, the
Court will treat it as a motion to alter or amend the
judgment under Fed. R. Civ. P. 59. Rule 59(e) allows
a party to move the Court for reconsideration of a judgment
within 28 days following the entry of judgment, and
encompasses reconsideration of matters decided on the merits.
Osterneck v. Ernst & Whinney, 489 U.S. 169, 174
(1989). The Court entered final judgment in this matter on
September 4, 2014, [Filing No. 75], yet Ms. Hiatt
did not file her motion until May 17, 2017, [Filing No.
129] - 32 months later, which is well outside of the
28-day period provided in Rule 59. This untimeliness provides
yet another basis for the Court's denial of Ms.
Ms. Hiatt's motion is without merit. Affording relief
through granting a motion for reconsideration brought
pursuant to Rule 59(e) is an “extraordinary remed[y]
reserved for the exceptional case.” Foster v.
DeLuca, 545 F.3d 582, 584 (7th Cir. 2008). Rule 59
motions are for the limited purpose of “correct[ing]
manifest errors of law or fact or…present[ing] newly
discovered evidence.” Rothwell Cotton Co. v.
Rosenthal & Co., 827 F.2d 246, 251 (7th Cir. 1987)
(quoting Keene Corp. v. Int'l Fidelity Ins. Co.,
561 F.Supp. 656 (N.D. Ill. 1982)). “A ‘manifest
error' is not demonstrated by the disappointment of the
losing party. It is the ‘wholesale disregard,
misapplication, or failure to recognize controlling
precedent.'” Oto v. Metropolitan Life Ins.
Co., 224 F.3d 601, 606 (7th Cir. 2000) (quoting
Sedrak v. Callahan, 987 F.Supp. 1063, 1069 (N.D.
Ill. 1997)). Ms. Hiatt's arguments in support of her
motion are baseless, and do not warrant reconsideration.
First, her argument that she is not a citizen or resident of
the United States, but rather is a resident of Indiana, is
not supported by applicable law. See United
States v. Cooper, 179 F.3d 691, 692 (7th Cir. 1999)
(rejecting appellant's “wholly frivolous,
tax-protester arguments, such as that only residents of
Washington, D.C., and other federal enclaves are subject to
the federal tax laws because they alone are citizens of the
United States…..”). Second, Ms. Hiatt's
arguments that she has no tax liability are similarly
baseless. The Court has already found that Ms. Hiatt had
taxable income for the years for which the Government sought
payment, and that she is liable for taxes based on that
income. [Filing No. 74 at 14-16.] Ms. Hiatt has not presented
any basis for the Court to reconsider its earlier
Ms. Hiatt filed her Motion to Void Judgment and Dismiss
pro se while represented by counsel, the motion is
untimely, and the motion is meritless, the Court DENIES the
motion. [Filing No. 129.]
to Cease and Desist - Dismiss
Hiatt has also filed a Motion to Cease and Desist - Dismiss,
in which she raises some of the same arguments set forth in
her Motion to Void Judgment and Dismiss. [Filing No.
132.] Specifically, Ms. Hiatt argues that there is no
statute that creates income tax liability and that she is not
subject to federal tax laws because she is a citizen of
Indiana. [Filing No. 132 at 2-6.] The Court will
also treat Ms. Hiatt's Motion to Cease and Desist -
Dismiss as a motion to alter or amend the judgment under
Fed. R. Civ. P. 59. For the reasons set forth above
in connection with Ms. Hiatt's Motion to Void Judgment
and Dismiss - that the motion was filed pro se but
Ms. Hiatt is represented by counsel, that the motion is
untimely under Rule 59, and that Ms. Hiatt's arguments
are meritless - the Court DENIES Ms. Hiatt's Motion to
Cease and Desist - Dismiss. [Filing No. 132.]