United States District Court, M.D. Florida, Tampa Division
D. WHITTEMORE United States District Judge
THE COURT is United States' Motion for
Preliminary Injunction (Dkt. 14), which Defendants oppose
(Dkt. 17). The United States seeks a preliminary injunction
requiring Defendants to comply with their employment tax
obligations. Argument was presented during a hearing on
September 19, 2017. Upon consideration, the Motion is DENIED
courts have jurisdiction to issue orders of injunction
"as may be necessary or appropriate for the enforcement
of the internal revenue laws." 26 U.S.C. § 7402(a).
And, the traditional factors used in determining whether to
issue an injunction are used for issuing an injunction under
§ 7402(a). United States v. Ernst &
Whinney, 735 F.2d 1296, 1301 (11th Cir. 1984).
demonstrate entitlement to a preliminary injunction, the
party seeking the injunction must demonstrate: (1) a
substantial likelihood of success on the merits; (2)
irreparable injury will be suffered absent the injunction;
(3) the threatened injury outweighs the potential damage of
the proposed injunction; and (4) the injunction would not be
adverse to the public interest. Keeton v.
Anderson-Wiley, 664 F.3d 865, 868 (11th Cir. 2011).
"Foremost among the principles governing the use of the
injunctive remedy is the traditional requirement 'that
courts of equity should not act... when the moving party has
an adequate remedy at law and will not suffer irreparable
injury if denied equitable relief."' Ernst &
Whinney, 735 F.2d at 1301 n. 11 (alteration in original)
(quoting Younger v. Harris, 401 U.S. 37, 434, 91
S.Ct.746, 750, 27 L.Ed.2d 669 (1971); O'Hair v.
Hill, 641 F.2d 307, 310 (5th Cir.1981)).
United States has not shown that an injunction is necessary
or appropriate as required by § 7402(a). And, the United
States has not demonstrated a substantial likelihood of
success on the merits. The affidavit of Richard Paulsen, a
revenue officer at the Internal Revenue Service, is
conclusory.(Dkt. 14-1). However, even if the United
States could cure the deficiencies in Paulsen's
affidavit, the prospective relief it seeks is effectively an
"obey-the-law" injunction requiring the Defendants
to comply with internal revenue laws. And, the enforceability of
obey-the-law injunctions has been repeatedly questioned in
the Elevent Circuit. See e.g. S.E.C. v. Graham, 823
F.3d 1357, 1362 n. 2 (11th Cir. 2016) ("Repeatedly we
have said that... "obey-the-law" injunctions are
unenforceable."); Fla. Ass'n of Rehab.
Facilities v. Fit Dep't of Health & Rehab.
Servs., 225 F.3d 1208, 1222-23 (11th Cir. 2000) (citing
cases holding tin obey-the-law injunctions are
unenforceable); cf S.E.C. v. Goble, 682 F.3d 934,
949 (11th Cir. 2012 (recognizing that in some cases, an
injunction enj oining the violation of statutory and
regulatory provision may comply with Rule 65(d)).
United States' Motion for Preliminary Injunction (Dkt.
14) is DENIED without prejudice.
The terms of the injunction the United
States requests are as follows:
(1) Defendants shall pay over to the Internal Revenue
Service all income and Federal Insurance Contributions Act
("PICA") taxes withheld from employees and Askins
& Miller's own share of FICA taxes (collectively,
(2) Defendants shall segregate (i.e., hold separate
and apart from all other funds) all employment taxes of
employees of Askins & Miller in an appropriate federal
depository bank in accordance with the federal deposit
(3) Defendants shall not transfer any money or
property to any other entity to have that entity pay the
salaries or wages of Askins & Miller's
(4) Defendants shall not assign any of Askins &
Miller's property or rights to Askins & Miller's
property or make any disbursements from Askins &
Miller's accounts before paying ail required outstanding
liabilities due on each employment tax return required to be
filed going forward from the date of the preliminary
(5) Defendants shall sign and deliver affidavits to
the IRS at 5971 Cattleridge Boulevard, Suite 102-Mail Stop
5410, Sarasota, FL 34232, or to such other specific location
as directed by the IRS, within two banking days after each
employment tax deposit is due, ...