[NOT FOR PUBLICATION--NOT TO BE CITED AS PRECEDENT] United States Court of Appeals For the First Circuit

No. 98-1278

JACK T. FREDYMA,

Plaintiff, Appellant,

v.

LAKE SUNAPEE BANK, ET AL.,

Defendants, Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW HAMPSHIRE

[Hon. Shane Devine, Senior District Judge]

Before

Selya, Circuit Judge, Campbell, Senior Circuit Judge, and Lynch, Circuit Judge.

Jack T. Fredyma on brief pro se. Michael D. Ramsdell and Gallagher, Callahan & Gartrell, P.A.on brief for appellee Lake Sunapee Bank. Loretta C. Argrett, Assistant Attorney General, William S. Estabrook and Pamela C. Berry, Attorneys, Department of Justice and Paul M. Gagnon, United States Attorney, on brief for the appellees, United States of America, United States Department of Treasury, and Internal Revenue Service.

November 3, 1998

Per Curiam. Plaintiff-appellant Jack Fredyma appeals pro se from the dismissal of his claims against various federal defendants (the Internal Revenue Service, the Department of Treasury, and the United States) and the grant of summary judgment in favor defendant Lake Sunapee Bank (formerly Landmark Bank). We affirm. The underlying action stems from a levy placed by the Internal Revenue Service ("IRS") on a Landmark Bank account containing a certificate of deposit under the names of Fredyma and his mother. The bank honored the levy by withdrawing $9,338.00 from the account and sending the money to the IRS. For the purposes of this appeal, it is assumed by all parties that the funds in the account derive from two lump sum workers' compensation payments to Fredyma totaling approximately $100,000.00. Fredyma contends that the bank account was immune from levy under 26 U.S.C. 6334(a)(7) (exempting from levy any amount "payable" to an individual as workmen's compensation). This contention lies at the heart of a five count complaint filed against defendants on September 17, 1996. Three of these counts are at issue on appeal: Count I alleges wrongful levy by the IRS, Count II alleges reckless and intentional violation of 26 U.S.C. 6334(a)(7) by IRS officials, and Count V alleges that the bank violated state law in honoring the levy. Fredyma's complaint indicates that he filed several "administrative complaints" protesting the levy prior to -2- initiating the instant lawsuit. The IRS allegedly responded, inter alia, that workers' compensation benefits are not exempt from levy upon deposit in a bank account. In the district court, both the federal defendants and the bank took the position that the funds at issue were not immune from levy. The district court dismissed Count I for lack of jurisdiction. In particular, the court concluded that Count II, which alleges a cause of action under 26 U.S.C. 7433, is the only claim as to which the United States has waived its sovereign immunity. Fredyma has made no persuasive argument otherwise on appeal, and we conclude that Count I was properly dismissed for lack of jurisdiction. The district court entered judgment in favor of the defendants on Counts II and V after concluding that the funds at issue were not exempt from levy. Noting that the issue is one of first impression, the lower court concluded that the plain meaning of "payable" in 6334(a)(7) applies to an amount to be paid or capable of being paid but not money that has already been paid. Fredyma challenges this interpretation, and he points to legislative history which, he contends, indicates that Congress intended to protect monies paid. See H.R. Rep. No. 89-1884, at 61 (1996); S.R. No. 89-1708, at 19 (1966), reprinted in 1966 U.S.C.C.A.N. 3722, 3741. We affirm the dismissal of Count II on an alternative basis than that given by the district court. By its terms, 26 U.S.C. 7433(a) permits the recovery of damages against the government only for "reckless[]" or "intentional[]" disregard of an Internal Revenue Code provision. Where, as here, the IRS's interpretation of the Code is, at the very least, reasonable, no action lies under 7433. Cf. United States v. Toyoto of Visalia,

(E.D.Cal. 1991) (indicating that it is not the intent of 7433 that "any time an officer of the IRS makes a mistake or simply does not agree with a particular interpretation of the law, the United States is liable for damages"), aff'd,

(1993). In so holding, we express no opinion as to whether or not the IRS is correct in its interpretation. We also affirm the dismissal of Count V on an alternative basis. Contrary to Fredyma's suggestion, we conclude that 26 U.S.C. 6332(e) protects the bank from any liability arising from the surrender of the property. The Ninth Circuit opinion relied upon by Fredyma, Farr v. United States,

(9th Cir. 1993) (holding that an employer was not immune from liability to a taxpayer for its improper transfer of workers' compensation benefits), is distinguishable on its facts. In Farr, the IRS never asked the party in possession to turn over workmen's compensation benefits; indeed, it eschewed any desire to have the party do so. Farr,

. By contrast, in the instant case the IRS levied on the very property in question. Affirmed.