Free Answer to Counterclaim - District Court of Federal Claims - federal

Case 1:05-cv-00971-CCM

Document 7

Filed 11/14/2005

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS ROBERT B. DIENER and MICHELLE S. DIENER, Plaintiffs-Counterdefendants, V. THE UNITED STATES Defendant-Counterplaintiff. ) ) ) ) ) ) ) ) ) )

No. 05-971 T (Judge Christine O.C. Miller)

REPLY TO COUNTERCLAIM In reply to the Counterclaim, Robert B. Diener and Michelle S. Diener ("Counterdefendants" or the "Dieners") deny each and every allegation that is not admitted or otherwise specifically addressed below. 1. Counterdefendants admit that 26 U.S.C. § 7401 authorizes the Counter-

plaintiff to file a counterclaim. Counterdefendants deny the remainder of the allegations in paragraph 1 of the Counterclaim. 2. Counterdefendants deny that they had taxable income of $110,125,759.00

for the year ending December 31, 2000. Counterdefendants admit the remaining allegations in paragraph 2 of the Counterclaim. 3. Counterdefendants deny that they underpaid their federal income tax in the

amount of $12,664,612.00. Counterdefendants admit that on January 4, 2005 they paid, under protest, the federal income tax assessed in Counterplaintiff's Notice of Deficiency (which was invalid, as it was not sent to the Dieners' last known address within the three year statute of limitations as required by I.R.C. § 6501) in the amount of $12,664,612. Counterdefendants allege that they are entitled to a refund of the entire $12,664,612 paid, plus interest thereon, as such additional tax was wrongly assessed.

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Case 1:05-cv-00971-CCM

Document 7

Filed 11/14/2005

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4. Counterclaim. 5.

Counterdefendants deny the allegations contained in paragraph 4 of the

Counterdefendants admit that on January 24, 2005 they paid, under

protest, the $2,532,922.40 alleged in the Notice of Deficiency to be a penalty under 26 U.S.C. § 6662(a). Counterdefendants further aver that they are entitled to a refund of such amount plus interest thereon, as such penalty was wrongly assessed. 6. Counterclaim. 7. Counterclaim. 8. Counterclaim. 9. Counterclaim. WHEREFORE, Counterdefendants request that this Court enter judgment (1) denying the Counterclaim filed by the Counterplaintiff, (2) awarding the Dieners a refund of the $12,664,612 income tax and the $2,532,922.40 penalty assessed and paid in response to the Notice of Deficiency with respect to their 2000 Form 1040, or such greater amount as is legally refundable, plus additional allowable interest, and (3) awarding the Dieners their costs, attorney's fees, and other relief the Court deems appropriate. Counterdefendants deny the allegations contained in paragraph 9 of the Counterdefendants deny the allegations contained in paragraph 8 of the Counterdefendants deny the allegations contained in paragraph 7 of the Counterdefendants deny the allegations contained in paragraph 6 of the

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Case 1:05-cv-00971-CCM

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Filed 11/14/2005

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Respectfully submitted, s/ John W. Porter John W. Porter Attorney of Record Stephanie Loomis-Price (Of Counsel) J. Graham Kenney (Of Counsel) BAKER BOTTS L.L.P. 3000 One Shell Plaza 910 Louisiana Houston, Texas 77002-4995 (713) 229-1597 (713) 229-2797 (Fax) COUNSEL FOR PLAINTIFFSCOUNTERDEFENDANTS

Dated: November 11, 2005

By:

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