• Jim Walker, Attorney

Jim Walker Beats the Federal Government’s Team of Lawyers



FINDINGS, CONCLUSIONS, AND RECOMMENDATION

Before the Court for recommendation are the plaintiff’s Motion for Order for Defendant Smart Ilesanmi Ajayi to Show Cause Why He Should Not Be Held in Civil Contempt for Violating the Court’s Injunction Order (ECF 22), filed June 9, 2020 (doc. 26), and Motion for Order for Defendant Smart Ilesanmi Ajayi to Show Cause Why He Should Not Be Held in Civil Contempt for Violating the Court’s Injunction Orders (ECF 18, 22), filed November 19, 2020 (doc. 42). Based on the relevant filings, evidence, oral argument, and applicable law, the motions should be DENIED.

I. BACKGROUND

On February 25, 2019, the United States of America (Plaintiff) brought this civil action for permanent injunction under sections 7402(a), 7407, and 7408 of the Internal Revenue Code against Smart Ilesanmi Ajayi, individually and doing business as Harplet Marketing, LLC (Harplet), Topps Tax Services (Topps Tax), and Smart Tax Services (Smart Tax) (collectively Defendant) and JoAnn Villarreal. (See doc. 1.) It alleged that Defendant and Villarreal had violated internal revenue laws by, among other things, preparing tax returns which understated their customers’ tax liabilities by fabricating or inflating (i) deductions on Schedule A (Itemized Deductions) in the form of noncash charitable deductions, and (ii) businesses losses on Schedule C (Profit or Loss from Business). (Id. at 3.)2 The parties stipulated to the entry of a preliminary injunction against Defendant and Villarreal, and the district court issued an Order for Preliminary Injunction (October 2019 Order) on October 10, 2019, which would be effective October 31, 2019. (See docs. 16, 18.)


The October 2019 Order enjoins Defendant and Villarreal from “acting as a federal tax return preparer and assisting in, advising, or directing the preparation or filing of federal tax returns, amended returns, or any other federal tax documents or forms for any person or entity other than themselves, and owning, operating, managing, working in, controlling, licensing, consulting with, or franchising a tax return preparation business;” orders them to “close and not re-open, without further order from the Court, all tax return preparation stores that they own directly or through any entity, and whether those stores do business as Harplet Marketing, LLC, Topps Tax Services, and Smart Tax Services, or under any other name,” by no later than October 31, 2019; and prohibits them from “assigning, transferring, or selling any franchise agreement, independent contractor agreement, or employment contract related to Harplet Marketing, LLC, Topps Tax Services, and Smart Tax Services, or any other tax return preparation business to which he or any entity under their control is a party.” (Id. at 1-2.) It does not prohibit them from “consulting and communicating with former customers about tax returns that were prepared prior to filing of this suit.” (Id.)


READ FULL DETAILS IN ARTICLE BELOW:

2021 10042021 ORDER - Findings, Conclusions and Recommendation [Doc 99]
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