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Business/Finance
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Title: Westminster man told to stop running tax scheme
Source: Baltimore Sun
URL Source: http://www.baltimoresun.com/news/lo ... story?coll=bal-local-headlines
Published: Dec 4, 2006
Author: AP
Post Date: 2006-12-04 18:32:27 by Starwind
Ping List: *unUsual Suspects*     Subscribe to *unUsual Suspects*
Keywords: Kotmair, Save-A-Patriot Fellowship
Views: 3303
Comments: 200

A Westminster man has been barred by a federal judge from running a scheme in which he promised to help members avoid paying federal taxes, the U.S. Department of Justice announced today.

The "Save-A-Patriot Fellowship" run by John Baptist Kotmair Jr. falsely advised that clients didn't have to pay taxes and could legally withdraw from the Social Security system, U.S. District Judge William Nickerson said in his ruling. Despite legal action by the U.S. Justice Department, Kotmair's organization continued to file frivolous protest letters with the Internal Revenue Service on behalf of more than 800 clients and showed "no inclination ... to cease their activities," Nickerson noted.

Nickerson's order, issued last week, permanently bars Kotmair and his organization from representing or assisting anyone in corresponding with the IRS, or preparing court filings relating to income taxes. Kotmair and his organization must also notify all individuals involved in the scheme of the injunction and provide the Justice Department with the names of the customers, their e-mail addresses and telephone and Social Security numbers.

The injunction also must be posted prominently on the organization's Web sites for a year, and fraudulent promotional materials must be removed from the sites.

Poster Comment:

Kotmair's defense and taxation arguments were inane to put it charitably. His website (where he's to post the injunction) is at http://save-a-patriot.org/

Stupid tax-protestors and their schemes just muddy the water for legitimate tax-protest arguments. Kotmair, Schiff, Schultz, Rose all will become boilerplate examples of tax schemes which will be used unfairly to broad-brush and defeat otherwise legitimate arguments, rasing the cost and complexity to properly take on the IRS.

I cite Joe Banister as an example of how to do it right, intelligently, and the above tax schemes just make it difficult if not impossible for people like Banister to prevail honestly on the merits. Subscribe to *unUsual Suspects*

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Begin Trace Mode for Comment # 63.

#30. To: Starwind, All (#0)

First and foremost, to the best of my knowledge, as of this writing, neither John Kotmair nor SAPF's attorney have been served notice of any order. Until we are served, there's not much we can say about it. I think it's quite interesting that the DOJ might have made such an annoucement prior to SAPF being served.

The "Save-A-Patriot Fellowship" run by John Baptist Kotmair Jr. falsely advised that clients didn't have to pay taxes and could legally withdraw from the Social Security system, U.S. District Judge William Nickerson said in his ruling.

I can state that neither John Kotmair nor SAPF has ever "advised" people of what they can and cannot do with regard to taxes. It is perfectly legal to tell others what the law says so long as any listeners make their own decisions as to how the law applies to them and what it requires them to do. It's long known that congress has made dispensing such advice about what the law requires specific people to do a licensable privilege, just as they've made many other things into privileges. The caution against giving advice has been prominent for the entire time I've been with SAPF, and it is simply not done.

Despite legal action by the U.S. Justice Department, Kotmair's organization continued to file frivolous protest letters with the Internal Revenue Service on behalf of more than 800 clients and showed "no inclination ... to cease their activities," Nickerson noted.

If the legal action referred to is the civil suit instigated by the DOJ, I fail to see why SAPF should not have continued activities it's conducted since 1984 prior to a resolution in the suit.

Poster Comment:

Kotmair's defense and taxation arguments were inane to put it charitably. His website (where he's to post the injunction) is at http://save-a-patriot.org/

Starwind, I'm surprised to hear you claim this. You are aware, aren't you, that John Kotmair/SAPF defeated the IRS in their criminal case in 1993-96? The IRS raided the fellowship headquarters in full military/swat-team style and took everything that wasn't nailed down. They were subsequently ordered to bring it all back, which they did. Because they lost that case -- with prejudice, and that at their own motion -- they could not take any criminal action against the fellowship. That is why this time it was a civil case.

Stupid tax-protestors and their schemes just muddy the water for legitimate tax-protest arguments. Kotmair, Schiff, Schultz, Rose all will become boilerplate examples of tax schemes which will be used unfairly to broad-brush and defeat otherwise legitimate arguments, rasing the cost and complexity to properly take on the IRS.

I will say that I agree that false arguments do muddy waters for those arguing legitimately, and that has been lamented with regard to others in the past. But please share what legitimate tax-protest argument it is you subscribe to.

For the record, there is a framed sign hanging in the lobby of SAPF's office which informs the reader that SAPF's interest is not in protesting any tax, but only insists on proper application of the current tax law. Becaues it does not protest any tax, lawful or otherwise and it is not a tax-protest organization and does not advance any tax protest arguments.

I cite Joe Banister as an example of how to do it right, intelligently, and the above tax schemes just make it difficult if not impossible for people like Banister to prevail honestly on the merits.

Yes, Joe Banister won his case but I'm not even sure how his position in taxes is that much different from SAPF's. He does emphasize the fact that the 16th wasn't properly radified which SAPF doesn't care about but beyond that??? The courts pretty much claimed the matter was out of their jurisdiction.

Neil McIver  posted on  2006-12-04   22:55:55 ET  Reply   Untrace   Trace   Private Reply  

First and foremost, to the best of my knowledge, as of this writing, neither John Kotmair nor SAPF's attorney have been served notice of any order. Until we are served, there's not much we can say about it. I think it's quite interesting that the DOJ might have made such an annoucement prior to SAPF being served.

I'm puzzled to see you write "we", as if you are a party to the action against Kotmair and SAPF, and as if you yourself expect to be served????

As for the facts of the injunction, it's over, stick a fork in it. The order, injunction and opinion were all filed by Judge Nickerson 11/29/06 (I've read them - they're available on the court website https:// ecf.mdd.uscourts.gov/cgi-bin/iqquerymenu.pl?130431 select History/ Documents... then select doc #s 68, 69 & 70 - you'll need a pacer account which anyone can register and receive, these are public records) with instructions to the clerk to transmit copies to all counsel of record. I'm sure Kotmair knew this on the 29th and has received the clerks transmitted copies as of today. I'm a bit skeptical that his website doesn't show any of the 37 filings that have been made since 5/16/06.

You are aware, aren't you, that John Kotmair/SAPF defeated the IRS in their criminal case in 1993-96? The IRS raided the fellowship headquarters in full military/swat-team style and took everything that wasn't nailed down. They were subsequently ordered to bring it all back, which they did. Because they lost that case -- with prejudice, and that at their own motion -- they could not take any criminal action against the fellowship.

I don't actually know what the facts are. I'd have to go pull the docs on that case as well (perhaps I might). But what Kotmair has posted and referred to as:

"If the court declared the Fellowship's operation legal in 1996, it must certainly be legal in 2005. If the IRS could not find any criminal activity in 1993 and 1994, while they had all of our computers and paper files, surely they would not find any today."

is disingenuous as the posted signature pages of two filings from that case don't show any such declaration or finding of legality. Just that the case is being dismissed with prejudice - that is not a finding on the merits. The case it seems was withdrawn by the government as the IRS (in a botched raid) botched the case. But the tax issues themselves were not litigated or adjudicated. And obviously, even if they were dispensing valid legal tax advice or operating legally as of 1995, that doesn't mean that they remained so in the last 10 years.

For the record, there is a framed sign hanging in the lobby of SAPF's office which informs the reader that SAPF's interest is not in protesting any tax, but only insists on proper application of the current tax law. Becaues it does not protest any tax, lawful or otherwise and it is not a tax-protest organization and does not advance any tax protest arguments.

Well Kotmair (and SAPF) failed to dispute the government's case and it seems was non-responsive and frivolous to the discovery filings, on which basis the judge granted summary judgment to the government. Avoiding summary judgement is lawyering 101 - there is no excuse (assuming Kotmair had a case to make).

Though I've not read all 70 documents, it appears Kotmair/SAPF failed to comply with the trial judges rulings on discovery and was uncooperative in general, and the case then reverted from the assigned trial judge back to district court to Nickerson for disposition, where again Kotmair seems to have lost every motion and appeal, I would assume, for continuing to be non-responsive (or frivolous) to discovery and motions.

I might be more sympathetic to Kotmair's side of the debacle if he were more forthcoming in presenting his refutation of the judges rulings, but he stopped posting filings with doc #33 on 5/16/06. The record was not sealed and they are public findings. While Kotmair is not obligated to post them, one has to wonder why he stopped posting them as his defense was disintegrating. In view of what I have read (and past observations of similar fiascos), I'm inclined to accept the judges viewpoint at face value.

Starwind  posted on  2006-12-05   0:34:03 ET  Reply   Untrace   Trace   Private Reply  

I'm puzzled to see you write "we", as if you are a party to the action against Kotmair and SAPF, and as if you yourself expect to be served????

I am a member of SAPF, as as a member, I believe I'm technically party to the suit even though I've not be served so much as a scribbled-upon napkin.

As for the facts of the injunction, it's over, stick a fork in it. The order, injunction and opinion were all filed by Judge Nickerson 11/29/06

I'm sure you're conveying what the web site says, but the fact remains that it's required that we be served and my latest info is we have not. I'm sure there will be an appeal and, if rumors are true as to its content, maybe some clarification on the order as well.

I'm a bit skeptical that his website doesn't show any of the 37 filings that have been made since 5/16/06.

I'll ask the webmaster about that, though the front page says it was last update on 9/12/06. Might be a case of them being posted but missing links on the page.

is disingenuous as the posted signature pages of two filings from that case don't show any such declaration or finding of legality. .... Just that the case is being dismissed with prejudice - that is not a finding on the merits.

There was a formal decision by a judge (Garbis) and SAPF won. The IRS appealed that decision but then moved to dismiss the appeal with prejudice, which was granted. So there was a judicial decision favoring SAPF. This is not a case of them getting off to a bad start and aborting prior to any ruling.

And yes, they really mishandled things, as the plan was for a grand jury to indict Kotmair in South Dakota or some state up that way. They summoned him up there on false pretenses of being a witness and then faced the GJ that just got an earful from the DOJ. He spent 45 minutes with them and walked out unindicted. Apparently the IRS didn't get the memo as they proceeded to raid SAPF the following AM.

Well Kotmair (and SAPF) failed to dispute the government's case and it seems was non-responsive and frivolous to the discovery filings, on which basis the judge granted summary judgment to the government. Avoiding summary judgement is lawyering 101 - there is no excuse (assuming Kotmair had a case to make).

Do you know this to be true? I have it that there were plenty of arguments made. The ball was not dropped by SAPF, Star. If you are basing your comments solely on what the judge wrote, then I'm afraid you're not getting the facts. This is a very deep case in which the IRS didn't even want to offer their witnesses for deposition. It was pulling teeth with them all the way.

I will admit I've not been involved with the details of the case, but I converse with those who have been on a very regular basis so I'm quite confident that your impressions on SAPF's handling of the case are very, very wrong.

Neil McIver  posted on  2006-12-05   1:56:20 ET  Reply   Untrace   Trace   Private Reply  

I'm sure you're conveying what the web site says, but the fact remains that it's required that we be served and my latest info is we have not.

Just to be clear, I'm not reading some paraphrased summary, I'm reading the judge's filed order, opinion, and injunction. The exact same documents as were distributed to the parties.

And your understanding of a need to be served in this instance is incorrect. This is a trial matter. When the suit started, attornies of notice and record were identified with addresses for the specific purpose of designating to whom and where documents are to be sent. There is no need for a process server to track down and "serve" parties to a suit with court documents filed pursuant to that suit. This is not like process serving. The attorney of record for Kotmair/ SAPF is George E Harp Attorney at Law LEAD ATTORNEY, ATTORNEY TO BE NOTICED (I've withheld his address from this post, but it is a matter of public record), and he most likely received a 1-2 day courier delivery of the judge's rulings.

A jury trial is a right. It's not a privilege. A Right. You can't sacrifice someone's right out of expediency. And maybe if the government wasn't so busy carrying on it's illegal drug war they'd have more time to afford the rest their Right to a trial.

Not quite. The Seventh Amendment provides for jury trials in federal civil cases at common law or monetary damages, but not for injunctions. Read more at Juries In-depth: Right to a jury trial.

There are 67 PDF documents listed there. You can say a lot of things, but to say we were non-responsive in the suit is flat out wrong.

That docket is a list of filings, within which the substantive filings (which complied with court procedure) were mostly made by the government. The Kotmair filings were often (not always) frivolous in their argument and non-responsive in their content and/or violation of rules. The judge overruled Kotmair's objections and denied his motions generally, and the US occasionally. The bottom line is Kotmair represented himself poorly and it shows in his pleadings. The case never got out of discovery phase because Kotmair did not supply what he was asked to supply - that is the sense in which he was non- responsive, and further invented novel and frivolous interpretations of established law, and consequently failed to dispute the government's showing of no genuine issue of material fact on which to deny the injunction, and so on that basis the judge awarded summary judgement to the government.

And I doubt there will be an appeal because Kotmair failed to enter into the court record any basis on which an appellate court could find the trial court erred. ie, because Kotmair was mainly non-responsive and frivolous, there is very little of substance for an appellate court to reconsider.

Starwind  posted on  2006-12-05   13:08:35 ET  Reply   Untrace   Trace   Private Reply  

The attorney of record for Kotmair/ SAPF is George E Harp Attorney at Law LEAD ATTORNEY, ATTORNEY TO BE NOTICED (I've withheld his address from this post, but it is a matter of public record), and he most likely received a 1-2 day courier delivery of the judge's rulings.

Yes. Perhaps by now he has received it, but the latest word I have is he has not received it. Neither he nor SAPF. When I said we'd not been served, I meant neither SAPF nor Harp.

Not quite. The Seventh Amendment provides for jury trials in federal civil cases at common law or monetary damages, but not for injunctions. Read more at Juries In-depth: Right to a jury trial.

I believe you were arguing against allowing people the defense of their choice because the halls of our courts our quite crowded. My point is that crowded halls are no excuse for depriving people of due process. I'll amend my statement from "jury trial" to "due process". If you feel that due process should rightly be curtailed such that people are not permitted a defense not approved by the bench, simply because the courts are crowded, fine. But that's clearly wrong on a moral, if not legal, basis.

And I doubt there will be an appeal ...

I'm sure the effort will be made. Maybe the appeal will be tossed, but the appeal will be made.

Since you apparently hold no validity in the arguments of the "tax honesty" movement, so called, I'm curious as to what it was about Banister that you consider applaudable.

Neil McIver  posted on  2006-12-05   13:31:31 ET  Reply   Untrace   Trace   Private Reply  

If you feel that due process should rightly be curtailed such that people are not permitted a defense not approved by the bench, simply because the courts are crowded, fine.

Due process is not any process.

"Due" as in to what one is entitled. There is no right to frivolous process, non-responsive process, or just plain stupid process. One is entitled to due process in accordance with laws, regulations, statutes, and court procedures.

And my argument was that the rest of the litigants awaiting their day in court, waiting for their right to due process, should not be unduely delayed or if already at trial have their expenses and damages unduely increased because of someone elses imagined right to any process.

The same rules that apply to insurance companies seeking to avoid paying off a dying accident victim are the same rules that apply to Kotmair or the government. That's what due process looks like. Trial attornies know these rules, they know how due process works and where its boundaries are. This is the stuff of law schools and internships. These rules weren't just invented to thwart Kotmair. He represented himself and he alone is responsible for knowing and abiding by trial procedures.

I'm curious as to what it was about Banister that you consider applaudable.

Starwind  posted on  2006-12-05   13:48:53 ET  Reply   Untrace   Trace   Private Reply  

#65. To: Starwind (#63)

And my argument was that the rest of the litigants awaiting their day in court, waiting for their right to due process, should not be unduely delayed or if already at trial have their expenses and damages increased because of someone elses imagined right to any process.

That is hardly an argument against allowing people the defense of their choice. And I'm not talking about a filbuster defense. I'm talking abuot the right to tell a jury that one smoked marijuana out of medical need because he is seriously ill with cancer or something, or the right to tell a jury that one honestly believed there was no duty to file a tax return. Both of these defenses are routinely denied by judges, and they have absolutely *nothing* to do with a heavy docket. They have to do with suppression. In the latter case, just as a footnote, it is established by the supremes that *willful* failure to file is not applicable in cases where people have a good faith belief that there is not duty to file, regardless of the stated reason for the belief. I have seen court orders that bar defendents the defense of, among other things, telling the jury what the defendents believed the law to say or what the law required of them.

If you are of the position that there is justice in today's courts, then I suspect you just haven't been in many at all.

Neil McIver  posted on  2006-12-05 14:04:37 ET  Reply   Untrace   Trace   Private Reply  

These rules weren't just invented to thwart Kotmair.

I agree, many of the so-called "rules" were invented to thwart (manage) justice in general, and are violated by the courts themselves when the situation arises wherein the court feels justified or compelled.

I disagree that lawyers and internships have much to do with understanding the rules ... reading comprehension above a 3rd grade level is sufficient. I had an action against my father's Estate summarily dismissed by brief that had been sued out by a Probate Attorney (thug), that was also a Law Professor at Indiana University, and the Judge laughed him out of court. Incompetence is rampant in the legal profession.

noone222  posted on  2006-12-05 14:15:46 ET  Reply   Untrace   Trace   Private Reply  

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