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Bittner v. United States

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Supreme Court of the United States
Bittner v. United States
Term: 2022
Important Dates
Argued: November 2, 2022
Decided: February 28, 2023
Outcome
reversed and remanded
Vote
5-4
Majority
Neil Gorsuch • Chief Justice John Roberts (in part) • Samuel Alito (in part) • Brett Kavanaugh (in part) • Ketanji Brown Jackson
Dissenting
Amy Coney Barrett • Sonia Sotomayor • Clarence Thomas • Elena Kagan

Bittner v. United States is a case that was decided by the Supreme Court of the United States on February 28, 2023, during the court's October 2022-2023 term. The case was argued before the court on November 2, 2022. The court reversed and remanded the decision of the United States Court of Appeals for the 5th Circuit in a 5-4 ruling, holding that the "BSA treats the failure to file a legally compliant report as one violation carrying a maximum penalty of $10,000, not a cascade of such penalties calculated on a per-account basis."[1] Justice Neil Gorsuch delivered the majority opinion of the court. Justice Amy Coney Barrett filed a dissenting opinion, joined by Justices Sonia Sotomayor, Clarence Thomas, and Elena Kagan.[1][2] Click here for more information about the ruling.


HIGHLIGHTS
  • The issue: The case concerned the Bank Secrecy Act. Click here to learn more about the case's background.
  • The questions presented: "Whether a "violation" under the Act is the failure to file an annual FBAR (no matter the number of foreign accounts), or whether there is a separate violation for each individual account that was not properly reported."[3]
  • The outcome: The court reversed and remanded the decision of the United States Court of Appeals for the 5th Circuit in a 5-4 ruling.


    • The case came on a writ of certiorari to the United States Court of Appeals for the 5th Circuit. To review the lower court's opinion, click here.

    Timeline

    The following timeline details key events in this case:

    • November 2, 2022: The U.S. Supreme Court heard oral argument.
    • June 21, 2022: The U.S. Supreme Court agreed to hear the case.
    • February 28, 2022: Alexandru Bittner appealed to the U.S. Supreme Court.
    • November 30, 2021: The United States Court of Appeals for the 5th Circuit affirmed the summary judgment on Bittner's liability and failure to establish a reasonable-cause defense, reversed the summary judgment for Bittner on application of the $10,000 penalty cap to his non-willful violations of 31 U.S.C. § 5314, and vacated and remanded the case for further proceedings.

    Background

    Alexandru Bittner, a businessman with dual citizenship in the U.S. and Romania, failed to report his interests in foreign bank accounts on annual Foreign Bank and Financial Accounts (FBAR) forms, which is required by the Bank Secrecy Act of 1970 (BSA), while he was in Romania. The Internal Revenue Service (IRS) fined Bittner $2.72 million in civil penalties—$10,000 for each unreported account each year from 2007 to 2011. The United States District Court for the Eastern District of Texas denied Bittner's reasonable-cause defense and found him liable, but reduced the fines to $50,000, holding that the $10,000 maximum penalty is related to each failure to file an annual FBAR, not to each failure to report an account. On appeal, the U.S. Court of Appeals for the 5th Circuit affirmed the district court's deniel of Bittner's defense and reversed the assessment of fines. The 5th Circuit reinstated the $2.72 million penalty, holding that each failure to report a qualifying foreign account constituted a separate reporting violation under the Bank Secrecy Act, and that the penalty applied on a per-account basis.[4]

    Bittner appealed to the U.S. Supreme Court on February 28, 2022, and on June 21, 2022, the court accepted the case to its merits docket during the October 2022-2023 term.

    Questions presented

    The petitioner presented the following questions to the court:[3]

    Questions presented:
    “ Whether a "violation" under the Act is the failure to file an annual FBAR (no matter the number of foreign accounts), or whether there is a separate violation for each individual account that was not properly reported.[5] ”

    Oral argument

    Audio

    Audio of oral argument:[6]




    Transcript

    Transcript of oral argument:[7]

    Outcome

    The court reversed and remanded the decision of the United States Court of Appeals for the 5th Circuit in a 5-4 ruling, holding that the "BSA treats the failure to file a legally compliant report as one violation carrying a maximum penalty of $10,000, not a cascade of such penalties calculated on a per-account basis."[1]Justice Neil Gorsuch delivered the majority opinion of the court. Justice Amy Coney Barrett filed a dissenting opinion, joined by Justices Sonia Sotomayor, Clarence Thomas, and Elena Kagan.[1][2]

    “ Best read, the BSA treats the failure to file a legally compliant report as one violation carrying a maximum penalty of $10,000, not a cascade of such penalties calculated on a per-account basis. Because the Fifth Circuit thought otherwise, we reverse its judgment and remand the case for further proceedings consistent with this opinion.[5] ”
    —Justice Neil Gorsuch

    [1]

    October term 2022-2023

    See also: Supreme Court cases, October term 2022-2023

    The Supreme Court began hearing cases for the term on October 3, 2022. The court's yearly term begins on the first Monday in October and lasts until the first Monday in October the following year. The court generally releases the majority of its decisions in mid-June.[8]


    See also

    External links

    Footnotes

    1. ↑ 1.0 1.1 1.2 1.3 1.4 Supreme Court, Bittner v. United States, Certiorari to the United States Court of Appeals for the Fifth Circuit, accessed February 28, 2023
    2. ↑ 2.0 2.1 SCOTUSblog, Bittner v. United States, accessed February 28, 2023
    3. ↑ 3.0 3.1 U.S. Supreme Court, "21-1195 BITTNER V. UNITED STATES QP REPORT," June 21, 2022
    4. ↑ U.S. Court of Appeals for the 5th Circuit, United States v. Bittner, decided November 30, 2021
    5. ↑ 5.0 5.1 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
    6. ↑ Supreme Court of the United States, "Oral Argument - Audio," argued November 2, 2022
    7. ↑ Supreme Court of the United States, "Oral Argument - Transcript," argued November 2, 2022
    8. ↑ SupremeCourt.gov, "The Supreme Court at Work: The Term and Caseload," accessed January 24, 2022
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