Judge Rose denies plaintiffs application for injunction in the Bopp FATCALegalAction.com lawsuit


What follows is the announcement from the Republicans Overseas Facebook page and comments. What follows is Judge Rose’s decision which I will comment on in more detail when I have had time to read and consider it. You will find Judge Rose’s decision here

That said, I would like to make some initial comments about why Judge Rose approached the “equal protection” claim. You will see that on pages 25 – 38 of the lawsuit. I strongly encourage you to read these pages in particular.

You may recall the wisdom from 17th Century France (I wasn’t there) …

“The law in its majesty equality prohibits both the rich and the poor from sleeping on the park bench.”

Which Judge Rose carried forward into 21st Century America (I am here) …

FATCA in its majestic equality requires both Homelanders and Americans abroad to report their “foreign” bank accounts.

In the same way that the practical impact of the “park bench” law is to apply only to the poor, the FATCA reporting requirements apply only to Americans abroad.

In other words, Judge Rose is NOT looking to the effect of the law to consider a denial of equal protection.

He then suggests, in any event, that the classification of “Americans abroad” as a group is NOT a classification recognized by the law of equal protection.

Plaintiffs’ equal protection claims fail because the statutes, regulations and executive agreements that they challenge simply do not make the classification they assert. None of the challenged provisions single out U.S. citizens living abroad.

Instead, all Americans with specified foreign bank accounts or assets are subject to reporting requirements, no matter where they happen to live. The provisions Plaintiffs contend discriminate against “U.S. citizens living abroad” actually apply to all U.S.
taxpayers, no matter their residence. Plaintiffs argue that “[i]n practice, the increased reporting requirements for foreign financial accounts discriminate against
U.S. citizens living abroad,” see Doc. No. 8-1 at 22 (PageID 160), suggesting a claim of discrimination based on disparate impact. But it is well-settled that “mere disparate impact is insufficient to demonstrate an equal protection violation.” Copeland v. Machulis, 57 F.3d 476, 481 (6th Cir. 1995); see also Washington v. Davis, 426 U.S. 229, 244-45 (1976).

And then later:

Plaintiffs have not correctly identified the classification made by these laws. The most basic element of an equal protection claim is the existence of at least two classifications of persons treated differently under the law. See Silver v. Franklin Twp. Bd. of Zoning Appeals, 966 F.2d 1031, 1036 (6th Cir. 1992). But Plaintiffs fail to recognize that similarly situated persons to themselves—U.S. taxpayers living in the United States who hold foreign accounts—are not treated differently. In fact, for U.S. citizens living abroad, the regulations under 26 C.F.R. § 1.6038D-2 do not kick in until higher reporting thresholds are reached, as the regulations recognize that such individuals are likely to have significant foreign accounts in the ordinary course of their lives. For married individuals filing jointly, the filing threshold goes from $50,000 for U.S. residents to $150,000 for non-U.S. residents. To the extent that the law treats U.S. citizens living abroad unequally, it is in their favor insofar as the reporting requirements for foreign accounts are actually less onerous.

What we have learned from Judge Rose’s decision and the arguments advanced in the lawsuits …

As I read Judge Rose’s decision, it’s clear that he does NOT understand, that when it comes to FATCA, CBT, FBAR and whole “Alphabet Soup” disabilities inflicted on Americans abroad, that:

The claim is NOT (in practical impact) that Americans abroad are subjected to these rules and Homelanders are (in practical impact) not. The claim which must be articulated (and has not been properly articulated) is that:

Although both Americans Abroad and Homelanders are subjected to the same rules, the effect of these rules is that the lives of Americans abroad are being destroyed and that they are forced to renounce U.S. citizenship while Homelanders just keep on truckin! This is the message that must be better explained and articulated!

This is the claim that must be advanced and articulated. It’s clear that neither the ADCS lawsuit nor the Republicans Overseas lawsuit have effectively articulated this reality.

Tentative conclusion …

My advice to any American abroad is to either move to the United States or renounce U.S. citizenship immediately. You have NO chance of surviving outside the United States in a FATCA and FBAR world. No chance. Homelanders simply do not and cannot understand this. People can understand only what they can conceptualize. As is well known in the United States, there is no world outside the United States.

It would be truly hilarious to see the likes of these Homelander judges and politicians attempt to live outside the United States as proud and patriotic “U.S. Tax Compliant Persons”. I bet they would complain that their “rights” (attributes of American citizenship NOT) were being violated.

Onward and upward!

John Richardson

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One comment on “Judge Rose denies plaintiffs application for injunction in the Bopp FATCALegalAction.com lawsuit
  1. LM says:

    Thank you for such immediate update, clear information and commentary (discouraging as it is).

    Wanted to note to you that last week’s NYTimes Book Review (via the Hamilton Spectator) had a front page article about a new book entitled THE COURT AND THE WORLD – American Law and the New Global Realities (by Stephen Breyer); it focuses on how the US Supreme Court is now having to deal with lots of conflicting and difficult cases based not just on interpreting US law/constitutional law but on situations where conflict arises between US laws and laws in other countries.

    Thought it might be interesting and relevant…..

    I march on with you, Laura


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