Jack Klotz v. United States v. Darrell Howe, Jack Klotz v. United States v. Darrell Howe, Jack Klotz v. United States v. Darrell Howe

The Government appeals from a judgment awarding Klotz judgment for $600 in his tax refund suit against the Government and denying any relief to the Government on its counterclaim against Klotz and Howe to recover taxes and penalties under sections 6671 and 6672 of the Internal Revenue Code of 1954. Klotz and Howe cross-appeal from that portion of the judgment denying them attorneys’ fees under 42 U.S.C. § 1988 . The Government contends that the district court erred in holding that Klotz and Howe were not “responsible” persons who had “willfully” failed to pay payroll taxes. The Government does not contest that part of the judgment awarding a refund to Klotz. Howe abandoned his request for attorney’s fees in respect of proceedings before the district court. Klotz contends that he is entitled to attorney’s fees in respect of the trial court proceedings, and both Howe and Klotz request attorneys’ fees on appeal. We affirm the district court, and we deny attorneys’ fees on appeal.

This case arises from the collapse of Hamilton-Howe, an interior decorating firm. Howe and his mother first formed the company. It initially experienced modest success in furnishing and decorating model…