Mary Ann Tobin Civil Suit Charges Internal Revenue Service With Illegal Entry of Business and Residence.

Business Editors & Legal Writers

LOUISVILLE, Ky.--(BUSINESS WIRE)--Jan. 9, 2002

Did an Internal Revenue Service lawyer and her assistant violate a citizen's Fourth Amendment right under the U.S. Constitution by illegally entering the plaintiff's residence and adjoining place of business? Mary Ann Tobin says yes.

This is one of two major questions to be addressed in an unusual civil case scheduled here beginning February 19.

The plaintiff is a former elected Kentucky state official who owns and operates Broadmoor Gardens and Conservatory, a nationally recognized tourist attraction near one of the nation's largest military installations, Ft. Knox.

Tobin contends that in February 1997, IRS attorney Jennifer Troutman, and her assistant, Jeanette Blackburn, misrepresented themselves to Broadmoor employees, entered her home and conservatory in Meade County without permission or warrant, and conducted an unlawful search. When the incident occurred, neither the gardens nor conservatory were open to the public. Nor was the plaintiff on her property.

Ms. Troutman and Ms. Blackburn were employees of the Louisville Chief Counsel's Office, Department of the Treasury.

Ms. Tobin, who served as State Representative before being elected Kentucky Auditor of Public Accounts, also charges the IRS with illegally seizing papers and property, including tax and financial records. These ultimately were used to "wrongfully collect and/or attempt to collect a tax under the Internal Revenue laws," she claims.

A cover-up ensued, Ms. Tobin argues. She says she did not learn of the actions by IRS employees until approximately 10 months later.

She seeks compensatory and punitive damages in excess of $1 million for violation of her civil rights, plus recovery for federal income taxes wrongfully collected.

The case is before Federal Judge John G. Heyburn II of the United States District Court, Western District of Kentucky.

The IRS already has experienced three pre-trial defeats. An original setback came in June of 1999 when Judge Heyburn denied the agency's motion for dismissal.

On December 14, 2001 he denied two additional defendant motions. One was for summary judgment against Ms. Tobin's claim alleging violation of her Fourth Amendment rights. The other sought sanctions, contending the plaintiff didn't comply with discovery requests.

A separate but related case, originating nearly 10 years ago, occurred when Ms. Tobin successfully challenged an IRS ruling that she could not aggregate gains and losses from both her farm and Broadmoor Gardens.

In 1999 a Federal Tax Court agreed with her, mandating that the farm and Gardens were one business activity, which made the IRS position null and void.

This matter still isn't resolved, however. The IRS hasn't refunded Ms. Tobin's $200,000 good-faith tax deposit.

Therefore, a second issue in the pending trial will focus on the tax prepayment Ms. Tobin delivered to the IRS in 1999 - applied only in the event the Tax Court would not rule in her favor -- and the agency's continued refusal to return all money now due her.

Reference: Civil Action:3:98CV-663-H