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IN THE UNITED STATES COURT OF FEDERAL CLAIMS ______________ No. 06-393 T (Judge Baskir) OLD REPUBLIC LIFE INSURANCE COMPANY, Plaintiff, v. THE UNITED STATES, Defendant. ______________ ANSWER ______________ The defendant, the United States, denies each of the allegations in the complaint except those that are expressly admitted below. In further answer to the complaint, the defendant: 1. States that its attorneys lack knowledge or information
sufficient to form a belief as to the truth of the allegations in paragraph 1 of the complaint. 2. 3. Admits the allegation in paragraph 2 of the complaint. Denies that the defendant breached an agreement to pay an
account stated between the plaintiff and the defendant; denies that additional statutory interest is due to the plaintiff; denies that the defendant
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failed to compute or pay the correct statutory interest to the plaintiff; and admits the other allegations in paragraph 3 of the complaint. 4. Avers that 28 U.S.C. ยง 1491 confers jurisdiction upon this
Court, to the extent jurisdiction exists. 5. Avers that the plaintiff's 1979 consolidated federal income tax
return is stamped as received on December 18, 1980; states that its attorneys lack knowledge or information sufficient to form a belief as to the truth of the allegation that the return was filed in a timely manner on or about September 15, 1980; and admits the other allegations in paragraph 5 of the complaint. 6.-7. States that its attorneys lack knowledge or information
sufficient to form a belief as to the truth of the allegations in paragraphs 6 and 7 of the complaint. 8.-9. complaint. 10. Admits the allegations in the first two sentences of paragraph Admits the allegations in paragraphs 8 and 9 of the
10 of the complaint; and states that its attorneys currently lack knowledge or information sufficient to form a belief as to the truth of the allegations in the third sentence.
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11. 12.-13.
Admits the allegations in paragraph 11 of the complaint. States that its attorneys lack knowledge or information
sufficient to form a belief as to the truth of the allegations in paragraphs 12 and 13 of the complaint. 14. Admits the allegations in the first two sentences of paragraph
14 of the complaint; but avers that the Third Amended 1979 Return reports deductions increased by $2,242,368. 15. States that its attorneys currently lack knowledge or
information sufficient to form a belief as to the truth of the allegations in paragraph 15 of the complaint. 16. 17.-18. Admits the allegations in paragraph 16 of the complaint. States that its attorneys currently lack knowledge or
information sufficient to form a belief as to the truth of the allegations in paragraphs 17 and 18 of the complaint. 19. 20. Admits the allegations in paragraph 19 of the complaint. Admits that the plaintiff and the IRS executed a series of
Forms 907; avers that the Forms 907 contained in the IRS's administrative file extend the time to bring suit only to June 30, 2000; and states that its attorneys now lack knowledge or information sufficient to form a belief as
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to the truth of the allegation that the period was extended to September 30, 2001. 21.-22. complaint. 23. Admits the allegations in the first two sentences of paragraph Admits the allegations in paragraphs 21 and 22 of the
23 of the complaint; but states that its attorneys lack knowledge or information sufficient to form a belief as to the truth of the allegation in the third sentence. 24.-26. complaint. 27. Avers that the attached Audit Statement speaks for itself; Admits the allegations in paragraphs 24 through 26 of the
admits that the plaintiff has generally restated the information on Schedule 3 of the Audit Statement; but notes that the Schedule does not show whether the taxpayers filed consolidated or separate returns. 28.-30. complaint. 31. Admits that on May 15, 2000, the IRS scheduled an Admits the allegations in paragraphs 28 through 30 of the
overpayment of $69,655 for the plaintiff's consolidated 1979 tax year.
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32.
Avers that on June 5, 2000, the IRS abated a penalty of
$2,143.44 for the plaintiff's 1979 tax year and also abated assessed interest of $10,114.57. 33. Admits the allegations in the first sentence of paragraph 33 of
the complaint; and states that its attorneys lack knowledge or information sufficient to form a belief as to the truth of the allegations in the second sentence. 34.-35. complaint. 36. States that its attorneys lack knowledge or information Admits the allegations in paragraphs 34 and 35 of the
sufficient to form a belief as to the truth of the allegations in paragraph 36 of the complaint. 37.-39. complaint. 40. 41. Denies the allegation in paragraph 40 of the complaint. Admits that the plaintiff attached a computation of interest to Admits the allegations in paragraphs 37 through 39 of the
its complaint as Exhibit F; denies that Exhibit F is a correct computation of interest; and denies that interest is due to the plaintiff. 42. Denies the allegations in paragraph 42 of the complaint.
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43.
Admits the allegations in the third sentence of paragraph 43
of the complaint; admits that the plaintiff has surmised various speculations regarding what it considers to be an underpayment of interest; but denies that the plaintiff's speculations are correct. 44.-46. Avers that paragraphs 44 through 46 of the complaint make
assertions of law, which require no response. 47. 48. Admits the allegations in paragraph 47 of the complaint. Avers that paragraph 48 of the complaint asserts a legal
conclusion, which requires no response. 49.-50. States that its attorneys lack knowledge or information
sufficient to form a belief as to the truth of the allegations in paragraphs 49 and 50 of the complaint. 51.-53. Avers that paragraphs 51 through 53 of the complaint
assert legal conclusions, which require no response. 54. Admits that the plaintiff has attached as Exhibit G a purported
computation of interest in the form described in the first sentence of paragraph 54 of the complaint, but denies that the IRS used an "offset" in its own computation; admits the allegations in the second sentence, but denies that a balance is due to the plaintiff; admits that the computation
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shows a balance due to the plaintiff as described in the third sentence, but denies that there is any balance due to the plaintiff; and admits that Exhibit F computes statutory interest as described in the fourth and fifth sentences, but denies that any statutory interest is due to the plaintiff. 55. Denies that the IRS used an "offset" when computing interest
due to the plaintiff; denies that the plaintiff is entitled to a "counteroffset"; and admits the other allegations in paragraph 55 of the complaint. 56. Denies that the plaintiff is entitled to additional statutory
interest; and denies that the IRS reduced its earlier payments with offsets of barred items. 57. Admits that Exhibit F computes statutory interest as
described in paragraph 57 of the complaint; denies that any statutory interest is due to the plaintiff; and denies that the IRS understated the statutory interest it has paid to the plaintiff. 58. 59. Denies the allegations in paragraph 58 of the complaint. States that its attorneys lack knowledge or information
sufficient to form a belief as to the truth of the allegations in paragraph 59 of the complaint.
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WHEREFORE the defendant asks the Court to dismiss the plaintiff's complaint with prejudice. Respectfully submitted, s/ Robert Stoddart ROBERT STODDART Attorney of Record U.S. Justice Department, Tax Division Court of Federal Claims Section P.O. Box 26, Ben Franklin Station Washington, D.C. 20044 TEL: (202) 307-6445 FAX: (202) 514-9440 EILEEN J. O'CONNOR Assistant Attorney General DAVID GUSTAFSON Chief, Court of Federal Claims Section MARY M. ABATE Assistant Chief s/ Mary M. Abate Of Counsel September 11, 2006
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