898 F. 2d 156 - Friends of Oregon

MEMORANDUM*

1000 Friends of Oregon, et al. ("Friends") appeal the district court's rulings that it lacked subject matter jurisdiction over Friends' complaint for declaratory, injunctive, and mandamus relief and that Friends failed to state a claim for mandamus relief. We review de novo, see Roat v. C.I.R., 847 F.2d 1379, 1383 (9th Cir.1988), and affirm.

Friends filed a complaint in federal district court challenging the conduct of the Internal Revenue Service in issuing certain temporary Treasury regulations and proposing that they be made permanent without preparing an environmental impact statement as required by the National Environmental Policy Act of 1969. The district court held that it lacked jurisdiction under the Anti-Injunction and Declaratory Judgment Acts to review Friends' complaint. The district court also found that Friends failed to state a claim for mandamus relief.

Friends contends that the Anti-Injunction and Declaratory Judgment Acts are not applicable because their claims for relief do not affect the assessment and collection of taxes. This contention fails.

The Anti-Injunction Act provides, "no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person, ..." 26 U.S.C. Sec. 7421(a). If the nature of the plaintiff's claim calls in question a specific provision of the Internal Revenue Code, a regulation issued under the Code, or even, as here, a temporary regulation, the claim falls within the ambit of the Anti-Injunction Act. See Bob Jones Univ. v. Simon, 416 U.S. 725, 740 (1974) (suit purportedly challenging policy and not assessment of taxes still barred).

The Declaratory Judgment Act gives the federal courts the power to declare the rights and legal relations between the parties to an actual controversy, "except with respect to federal taxes." 28 U.S.C. Sec. 2201. The Declaratory Judgment Act is co-extensive with the Anti-Injunction Act. Perlowin v. Sassi, 711 F.2d 910, 911 (9th Cir.1983). Moreover, if the Anti-Injunction Act bars a plaintiff's claims for injunctive and declaratory relief, the Mandamus and Venue Act of 1962 cannot provide subject matter jurisdiction to review a complaint for mandamus. See Zimmer v. Connett, 640 F.2d 208, 209-10 (9th Cir.1981).

Although they disavowed this position at oral argument, in their complaint before the district court Friends challenged Internal Revenue Service temporary Treasury regulations which limit the deductibility of losses incurred from traditional tax shelters. We review the district court's dismissal of Friends' allegations below, and not new theories propounded for the first time at oral argument. See International Union of Bricklayers & Allied Craftsman Local Union No. 20, AFL-CIO v. Martin Jaska, Inc., 752 F.2d 1401, 1404 (9th Cir.1985) (court will review issue not raised below only in exceptional circumstances).

Because Friends' claims in their complaint challenge the validity of a Treasury regulation, the suit falls squarely within the ambit of the Anti-Injunction Act. See Bob Jones Univ., 416 U.S. at 740. Moreover, because the Anti-Injunction Act bars review of Friends' claim for injunctive relief, the Declaratory Judgment Act also bars review of Friends' claim for declaratory relief. See Perlowin, 711 F.2d at 911. Finally, the Mandamus and Venue Act of 1962 cannot provide subject matter jurisdiction. See Zimmer, 640 F.2d at 209-10.1

AFFIRMED.