This morning at 10 a.m. Terry Dehko and Sandy Thomas, owners of Schott's Supermarket will join libertarian Institute for Justice attorney Larry Salzman for a public statement to expand their lawsuit against the Internal Revenue Service on the front steps of the Theodore Levin U.S. Courthouse in Detroit, Michigan. Dehko and Thomas will announce a new plaintiff joining them in their case of unlawful seizure of their money by the U.S. Government. The new plaintiff is Mark Zaniewski of the family-owned Metro Marathon service station located in Sterling, Michigan.
This past September Dehko and Thomas (Terry Dehko's daughter) filed, in federal court, the unconstitutional confiscation of their business bank account this past January, 2013 by the Internal Revenue Service. The IRS stole more than $35,000 of much needed capital from the business even though the family-run grocer did nothing wrong. In March, 2013 the same happened to Mark Zaniewski's business which is why he is joining the lawsuit today.
The IRS finally backed down in November, illegally holding the grocer's money for over ten months and Zaniewski's money for more than seven months. The IRS has now dropped its civil forfeiture cases against them and is returning the confiscated money after discovering the business owners were not doing anything illegal.
The IRS originally seized the business' money without proof the business owners were doing anything wrong, but simply because the U.S. Government thought it suspicious there were frequent deposits made of less than $10,000 in cash. Even after both business owners showed the IRS legitimate cash receipts, the IRS initially refused to back down.
The grocer's lawsuit continues on today, adding Zaniewski as a plaintiff in an effort to prevent the U.S. Government from its continual and unconstitutional use of civil forfeiture against Americans and American businesses.
“The IRS should not be raiding the bank accounts of innocent Americans, and it should not take a team of lawyers to put a stop to this behavior,” said Institute for Justice Attorney Larry Salzman. “We are thrilled that Terry, Sandy, and Mark will finally get their money back, and we are moving ahead with their constitutional lawsuit against the federal government, which seeks to rein in the shameful practice of civil forfeiture in the future.”
The case seeks a federal court ruling declaring that property owners are entitled to a prompt hearing either before or immediately after their property is seized, and enjoining the IRS from using civil forfeiture in the future without providing such a prompt hearing. Further, the lawsuit asks the court to clarify that it is not illegal for law-abiding businesses to make frequent cash deposits for legitimate business purposes. Like most small-business owners, the Dehkos and Mark Zaniewski make regular cash deposits at their banks, and that is the sole reason the IRS seized their money.
As recently demonstrated in the The New Yorker and The Economist, civil forfeiture is one of the greatest threats to property rights in America today. Civil forfeiture allows the government to flout due process by seizing private property from Americans without ever charging them with—let alone convicting them of—any wrongdoing. Perversely, forfeited funds are then used to pad the budgets of the very agencies that seize the money.