The Kuretskis Seek Certiorari

0 Flares 0 Flares ×

We welcome back frequent guest blogger Carl Smith. Carl assisted the team that brought this case to the D.C. Circuit. He explains below the new player on the team and the goal of the request for cert. Keith

There have been several blog posts over the past year on the case of Kuretski v. Commissioner, a Collection Due Process case in which the taxpayers asked the D.C. Circuit to declare unconstitutional a provision of the Code that subtly pressures Tax Court judges to rule in favor of the IRS — i.e., the President’s power to remove Tax Court judges under section 7443(f).  See Potential Storm Over Removal Power of Tax Court Judges (Oct. 16, 2013); Follow up on Kuretski and Removal Power of Tax Court Judges (Oct. 18, 2013); Kuretski, the Tax Court, and the Administrative Procedure Act (June 23, 2014). This past June, the D.C. Circuit ruled that there was no separation of powers issue because (1) the Tax Court, while defined as an Article I (Congressional) court in section 7441, was really, for most constitutional purposes, an Article II Executive Agency exercising executive functions, and (2) there is no problem in the President, who heads the Executive Branch, ever having the power to remove officers of an Executive Agency.  Kuretski v. Commissioner, 755 F.3d 929 (D.C. Cir. 2014).  In the Tax Court and the D.C. Circuit, the Kuretskis were represented by Prof. Tuan Samahon of Villanova, Frank Agostino and his associate, John Miscione, and me.  Realizing that it would be wise to add more skilled Supreme Court litigators if the Kuretskis were to seek review there, we approached Goodwin Procter LLP to see if its Appellate Litigation Practice would take the lead before that Court – also pro bono.  A team of six lawyers from that firm’s practice volunteered.  Last week, the taxpayers in the case filed a petition for certiorari, listing William Jay of Goodwin Procter as lead attorney.  Mr. Jay has previously clerked for Justice Scalia and worked as an Assistant to the Solicitor General.  He frequently argues cases before the Court.  This blog post is to provide a link to the complete petition and to quote the petition’s introduction for those seeking an executive summary.


Section 7443(f) provides:  “Judges of the Tax Court may be removed by the President, after notice and opportunity for public hearing, for inefficiency, neglect of duty, or malfeasance in office, but for no other cause.”  In the absence of this provision, Tax Court judges could be removed during their fifteen-year terms only by Congressional impeachment and trial.

The Introduction to the petition reads as follows:

Tens of thousands of taxpayers each year litigate questions of federal law against the Executive Branch in the United States Tax Court.  And in each of those cases, the Chief Executive enjoys a degree of power over the decisionmaker:  A federal statute allows the President to remove Tax Court judges for specified cause. 26 U.S.C. sec. 7443(f).  The question presented is whether the separation of powers permits giving the President the power to remove these judicial officers.

The removal provision in Section 7443(f) is a nearly century-old anachronism, enacted before the Tax Court was the Tax Court and before its members were judges.  Congress adopted Section 7443(f) to authorize the President to remove members of the Board of Tax Appeals, an entity within the Executive Branch.  In 1969, however, Congress replaced the Board of Tax Appeals with the Tax Court.  And as this Court has squarely held, the Tax Court is a “Court[] of Law” that exercises “a portion of the judicial power of the United States” and does not exercise “executive” or “administrative” power.  Freytag v. Comm’r, 501, U.S. 868, 890-91 (1991).  Thus, Section 7443(f) today subjects those exercising “the judicial power of the United States”, and not any executive power, to removal by the Executive Branch.  The constitution precludes requiring the judicial power to answer to the executive power in that manner.  See Bowsher v. Synar, 478 U.S. 714 (1986).

The D.C. Circuit reached the opposite conclusion solely by disregarding this Court’s characterization of the Tax Court as exercising only judicial power.  Instead, the D.C. Circuit adopted the theory this Court rejected in Freytag:  that the Tax Court “exercises Executive authority as part of the Executive Branch.”   Pet. App. 3a.  Because it mischaracterized the nature of the power exercised by the Tax Court, the court of appeals concluded that Section 7443(f) poses no constitutional difficulties.

The question of Section 7443(f)’s constitutionality goes to the heart of the Tax Court’s legitimacy and the independence of the judicial power of the United States that the Tax Court exercises.  The Tax Court is the primary forum for tax-related disputes between taxpayers and the Executive Branch, hearing tens of thousands of cases each year.  It nationwide jurisdiction extends not only to monetary claims between taxpayers and the government, but also to, inter alia, sensitive and even politically charged disputes regarding the tax-exempt status of non-profit organizations.  Under the decision below, judges of the Tax Court must make those decisions knowing that they can be removed from office by one of the litigants:  the Chief Executive.

The court of appeals decided an important constitutional question, affecting tens of thousands of persons each year, based on reasoning that directly conflicts with this Court’s precedent.  This Court should grant certiorari to vindicate taxpayers’ right to have their cases heard by judges free from undue influence by the Executive.

The D.C. Circuit was the first circuit to rule on section 7443(f)’s constitutionality, so there is no circuit split – the usual way to obtain Supreme Court review.  However, the Court has granted review before on separation of powers questions where non-governmental litigants have consistently lost below.  See, e.g., Freytag v. Comm’r, 501, U.S. 868 (1991).

A principal dispute in Kuretski involves whether Freytag‘s statements about the Tax Court exercising the judicial power of the United States were confined to the Court’s interpretation of “Courts of Law”, as used in the Appointments Clause (the D.C. Circuit’s view), or were, instead, applicable, generally, across all constitutional provisions and doctrines (the Kuretskis’ view).

Secondly, the Kuretskis argue that the D.C. Circuit has misconstrued the Supreme Court’s separation of powers case law into rules that only enforce separation of Branches.  The Kuretskis point to case law of the Court, including Bowsher v. Synar, 478 U.S. 714 (1986) and Mistretta v. United States, 488 U.S. 361 (1989), considering whether a removal power can run afoul of the separation of powers when actors in one Branch are given powers that are ordinarily held by officers in other Branches.  Most apt is Bowsher, where a Congressional employee, the Comptroller General, was given certain executive powers concerning a balanced budget law.  Congress had long held a for cause removal power over the Comptroller General, which would not have been a problem had the Comptroller General held only legislative powers.  The Court held that the removal power became improper once the Comptroller General acquired executive powers under the balanced budget law.  Thus, the Kuretskis argue, it is not enough to say that there can be no separation of powers issue if both the subject of the removal power and its holder are in the same Branch of government, as the D.C. Circuit asserted.  Instead, the nature of the respective powers held by the two actors – regardless of Branch – is key.




Carlton Smith About Carlton Smith

Carlton M. Smith worked (as an associate and partner) at Roberts & Holland LLP in Manhattan from 1983-1999. From 2003 to 2013, he was the Director of the Cardozo School of Law tax clinic. In his retirement, he volunteers with the tax clinic at Harvard, where he was Acting Director from January to June 2019.


  1. Ten, yes 10, of our friends have petitioned the U.S. Supreme Court to review the
    presidential removal of Tax Court judges issue. Appropriately, they filed their petition the day before Turkey Day.

    As I understand their argument:

    (1) the Tax Court is not an Article III court, but (2) according to Freytag, the Tax Court exercises federal judicial power, and therefore (3) the President may not constitutionally remove a Tax Court judge. Why? Because the President and the Tax Court judge exercise separate powers–irrespective onto which governmental branch the Tax Court may properly rest.

    But the Kuretski counsel ignore appointment cause and removal effect. Compare 26 U.S.C. section 7443(b):

    “Judges of the Tax Court shall be appointed by the President, by and with the advice and consent of the Senate, solely on the grounds of fitness to perform the duties of the office.”

    with 26 U.S.C. section 7443(f):

    “Judges of the Tax Court may be removed by the President, after notice and opportunity for public hearing, for inefficiency, neglect of duty, or malfeasance in office, but for no other cause.”

    Is it not plain how “solely on the grounds of fitness to perform the duties of the office” constitutionally corresponds to solely “inefficiency, neglect of duty, or malfeasance in office”?

    Further, did Congress not intend that the Tax Court be “a body which shall be independent of executive authority, except in its selection, and free to exercise its judgment without the leave or hindrance of any other official or any department of the government?” See Humphrey’s Executor v. United States, 295 U. S. 602, 625-26 (1935).

    Incredibly, the Kuretski counsel ignore both section 7443(b) and Humphrey’s Executor.

    We are not far away from tax season. Regrettably, we must first pass through what can only be called tax silly season. In reverse order, here are some recent Kuretski counsel tax “arguments”:

    First, the President cannot remove a Tax Court judge because they exercise separate constitutional powers;

    Second, the office of United States Tax Court senior judge is unconstitutional under the Appointments Clause; and

    Third, Collection Due Process hearings and CDP Notices of Determination are invalid– the IRS Office of Appeals personnel who hold and issue them are “officers of the United States” lacking constitutional appointment.

    Had a tax defier raised the above three arguments in any court, let alone in the U.S. Supreme Court, nearly all of us would have denounced each argument as frivolous. Are those “arguments” unworthy of denunciation simply because attorneys raised them?

    • Carl Smith says

      I must respond.

      I am the only one of the ten lawyers who brought the suit (Tucker) in which I raised an Appointments Clause challenge to the lack of appointment of CDP hearing officers. The only other of the ten lawyers tangentially involved was Frank Agostino, who submitted an amicus cert. brief. While I lost the Tucker case, it was not because the issue raised was frivolous. The Tax Court opinion on this issue was 88 pages long in the slip opinion. A law review article by a former Tax Court clerk then came out severely criticizing the Tax Court opinion and agreeing with me. The D.C. Circuit affirmed the Tax Court, but did so only after abandoning significant parts of the Tax Court’s reasoning (such as the Tax Court’s statement that hearing officers don’t make final rulings). Just because the Supreme Court did not grant cert. does not make the Tucker argument wrong. And my goal for making the argument was not tax defying, but to improve the quality of Appeals personnel. If they are appointed, more thought would likely be given to their experience and training. The goal of the Appointments Clause is to make the politicians who appoint officers accountable to the public for bad appointments.

      Next, none of the ten of us has argued that “the office of United States Tax Court senior judge is unconstitutional under the Appointments Clause”. That was an argument raised by a pro se taxpayer, Ronald Byers. Mr. Byers lives in the 8th Circuit, where he had lost a Tax Court deficiency appeal before. He decided, instead, to appeal his Tax Court CDP case to the D.C. Circuit, and when the DOJ moved to transfer the case to the 8th Cir., he successfully made the argument that D.C. venue was proper. The four original Kuretski lawyers (including me) had similarly filed the Kuretskis’ appeal in the D.C. Circuit (though the Kuretskis lived in the 2d Circuit) at a time when the Byers transfer motion was pending, relying on the same venue argument. Because the Kuretskis expected to have the same venue fight as then going on in the Byers case, we submitted an amicus brief on behalf of Mr. Byers’ venue argument only. We never wrote a word on the merits of his constitutional argument, which I won’t comment on.

      Third, I don’t see the relevance to the removal power issue of section 7443(b)’s “solely on the grounds of fitness to perform the duties of the office” in the Tax Court judge appointment language — nor has the DOJ made such an argument. Art. III judges are also appointed by the President with the advice and consent of the Senate. Whether or not there were similar statutory language about fitness to perform the duties of the office in Art. III judge appointment authority, no one would argue that, consistent with the separation of powers, the President alone could remove an Article III judge. See paragraph 3 of the Declaration of Independence, which complained that “[King George III] has made Judges dependent on his Will alone, for the tenure of their offices, and the amount and payment of their salaries.” Constitutionally, Tax Court judges and Art. III judges may be removed by impeachment in the House and trial in the Senate. Our suit is only to abolish the President’s additional sole power to remove Tax Court judges — which power we think is a salutary thing to remove from the tax system. This is not a foot fault — the kind of issue raised by tax protestors.

      Finally, there are many provisions in the U.S. Code limiting removal powers with words similar to the limitations on removal power of Tax Court judges, “inefficiency, neglect of duty, or malfeasance in office”. When such a limitation is placed by Congress on the removal power held by a person who exercises the same powers as the remover (e.g., the President removing an Executive Agency officer who also exercises executive power), the issue is entirely different: i.e., does Congress have the power to limit the actions of another Branch? But this limiting language for removal does not cure Bowsher v. Synar problems of inter-power removal authority. Indeed, in Bowsher, the removal power over the Comptroller General similarly contained limitations including inefficiency, neglect of duty, and malfeasance in office. In that case, the dissent argued that such limitations could prevent abuse of the removal power by Congress over the actor who was now being given executive powers. The majority, though, soundly rejected that argument, explaining that these three verbatim terms were “very broad” and enabled removal power “for any number of actual or perceived transgressions . . . .” 478 U.S. at 729. Tellingly, the Supreme Court berated any contrary position: “Surely no one would seriously suggest that judicial independence would be strengthened by allowing removal of federal judges only by a [decision] finding ‘inefficiency,’ ‘neglect of duty,’ or ‘malfeasance.’” Id. at 730.

      Finally, William Jay was not the only former Solicitor General employee and Supreme Court justice law clerk who we spoke to about possibly representing the Kuretskis in that court. We spoke to several. None of the others thought the argument being raised in Kuretski frivolous. Indeed, one had volunteered to represent the Kuretskis (without our soliciting such assistance) within hours of the D.C. Circuit’s rendering its opinion — though he later had to withdraw his offer because of being overcommitted to arguing too many other cases this Term. And many of the other five lawyers from Goodwin Procter in addition to Mr. Jay have been former court of appeals or Supreme Court law clerks. Thus, many knowledgeable lawyers feel that this is a serious issue worthy of Supreme Court review.

  2. I’m not sure I understand the comment above. How does Section 7443(f) correspond to the Constitution? The Kuretskis’ argument, as I understand it, is that persons who exercise the judicial power must be removed via the Congressional impeachment process, not via Presidential removal.

    I also do not understand the selected quote from Humphrey’s. If the Tax Court was intended to be “independent” of the executive branch, wouldn’t that cut against the President’s removal power?

    Freytag has caused confusion because it incorrectly characterized the nature of the Tax Court’s power. Attorneys or taxpayers who make arguments pointing out the confused implications of the Court’s holding are not tax protestors.

    That is not to say I agree in the unconstitutionality of Section 7443. Rather, I would prefer Freytag be revisited and its judgment upheld on the grounds contained in the Scalia concurrence, in which case the objections to the removal power over Tax Court judges should disappear.

Comment Policy: While we all have years of experience as practitioners and attorneys, and while Keith and Les have taught for many years, we think our work is better when we generate input from others. That is one of the reasons we solicit guest posts (and also because of the time it takes to write what we think are high quality posts). Involvement from others makes our site better. That is why we have kept our site open to comments.

If you want to make a public comment, you must identify yourself (using your first and last name) and register by including your email. If you do not, we will remove your comment. In a comment, if you disagree with or intend to criticize someone (such as the poster, another commenter, a party or counsel in a case), you must do so in a respectful manner. We reserve the right to delete comments. If your comment is obnoxious, mean-spirited or violates our sense of decency we will remove the comment. While you have the right to say what you want, you do not have the right to say what you want on our blog.

Speak Your Mind