Zappone v. United States

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The Zappones own OSC, an Ohio scrap-metal recycling business. In November 2012, IRS Agents executed search-and-seizure warrants on OSC’s offices and the Zappones’ home while investigating alleged tax evasion and illegal restructuring. Agents arrested the Zappones and seized their computers, cell phones, business records, and cash from the company safe, which was taken to Brink’s, the security company. Brinks issued a receipt for $1,264,000. The Zappones maintain that the safe contained $3,150,000 and that the Agents pocketed the difference. In 2013, the government brought a civil-forfeiture proceeding against the $1,264,000; the Zappones asserted claims against the currency, alleging that the amount was understated. In 2014, the Zappones submitted administrative claims to the IRS seeking $1,886,000 with power-of-attorney forms that identified their counsel as Arnold and listed counsel’s address. Six months later, the IRS mailed letters denying the claims via certified mail to Arnold, stating that the Zappones could file suit no later than six months after the date of the mailing of the notification. The Zappones had switched counsel but had not notified the IRS. More than six months later, they sued IRS employees and one IRS subcontractor, based on the execution of the search-and-seizure warrants and the purported misappropriation of their cash. The Sixth CIrcuit affirmed that the Zappones filed their state-law and constitutional claims outside the appropriate limitations periods and rejected their requests for equitable tolling. View "Zappone v. United States" on Justia Law