Ohendalski v. United States of America

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
Richard S. Ohendalski,
Plaintiff,
v.
United States of America,
Defendant.
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Civil Action No. 4:25-cv-03316
MEMORANDUM AND RECOMMENDATION
This is a tax dispute that Defendant United States of America (the
“Government”) has moved to dismiss under Fed. R. Civ. P. 12(b)(6). 	Dkt. 6.
After 	carefully 	considering 	the 	motion, 	Plaintiff 	Richard 	S. 	Ohendalski’s
response, Dkt. 7, the Government’s reply, Dkt. 8, the pleadings, and the
applicable law, it is recommended that the motion to dismiss (Dkt. 6) be
granted.
Background
The relevant facts are drawn from the pleadings and the records of
related cases that are proper subjects of judicial notice. See Canada v. United
States, 950 F.3d 299, 313 n.16 (5th Cir. 2020) (taking judicial notice “of the
record in prior related proceedings”); Fed. R. Evid. 201(b)(2), (d) (authorizing
judicial 	notice 	“at 	any 	stage 	of 	the 	proceeding” 	of 	facts 	“not 	subject 	to
United States District Court
Southern District of Texas
ENTERED
January 29, 2026
Nathan Ochsner, Clerk
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reasonable dispute” that are “readily determined from sources whose accuracy
cannot reasonably be questioned”).
In this suit, Ohendalski seeks federal income tax refunds for 2002, 2003,
and 2004. 	Dkt. 1 at 1. 	But his tax liabilities for those years were resolved in
two prior cases: (a) in a U.S. Tax Court decision that was affirmed by the Fifth
Circuit; and (b) in the Government’s ensuing case in this Court to collect
outstanding 	taxes 	from 	Ohendalski. 	See 	Richard 	Ohendalski 	& 	Kay
Ohendalski v. Comm’r of Internal Revenue, No. 19021-12 (T.C. June 12, 2014),
aff’d, 605 F. App’x 457 (5th Cir. 2015) (per curium); Dkt. 6-1 at 3-5 (copy of the
Tax Court opinion); United States v. Ohendalski, Civil Action No. 4:22-cv-
02949, 2024 WL 2094656 (S.D. Tex. May 9, 2024) (Hoyt, J.).
In the first of those cases, Ohendalski and his wife petitioned the Tax
Court to redetermine their income tax deficiencies for 2002, 2003 and 2004.
See Dkt. 6-1 at 3-5 (Tax Court Order). During trial, the parties announced that
they had reached a settlement and read the terms into the record. 	Id. at 3.
When the Commissioner moved to enter a decision based on the settlement,
however, 	Ohendalski 	objected. 	Id. 	The 	Tax 	Court 	found 	Ohendalski’s
objection to be in bad faith as “an orchestrated attempt to avoid his agreed
resolution of this case ....” Id. at 3-4. Because the Ohendalskis had not claimed
the Commissioner’s computations were inconsistent with the settlement’s
terms, 	the 	Tax 	Court 	granted 	the 	Commissioner’s 	motion 	and 	found
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Ohendalski liable for tax deficiencies in 2002 through 2004 totaling $933,507,
late-filing 	penalties 	totaling 	$233,377, 	and 	civil-fraud 	penalties 	totaling
$443,415.83. Id. at 4 (citing 29 U.S.C. §§ 6651(a)(1) and 6663 for penalties).
Ohendalski appealed the Tax Court’s decision, but the Fifth Circuit
affirmed. See Ohendalski, 605 F. App’x at 457. The Fifth Circuit observed that
the 	Ohendalskis 	failed 	to 	provide 	an 	alternative 	to 	the 	Tax 	Court’s
computation, 	remarking 	that 	the 	Ohendalskis 	“have 	had 	many 	full
opportunities to resolve any error in the taxes they owe or in this judgment,
and have always avoided those opportunities.” Id.
Years later, the Government sought to collect outstanding taxes from
Ohendalski and his entities, including the same unpaid taxes and penalties
that the Tax Court had resolved. 	See United States’ Original Complaint,
United States v. Ohendalski, Civil Action No. 4:22-cv-2949, Dkt. 1 (S.D. Tex.
Aug. 30, 2022). 	By then, the amount he owed for 2002 through 2004 had
ballooned to $3,701,469.28, which accounted for accrued penalties, interest,
statutory additions, plus some civil penalties for two other tax years (2010 and
2016). 	See Ohendalski, 2024 WL 2094656, at *2. 	After filing suit, the IRS
recovered about $3.2 million from assets owned by Ohendalski or entities that
he controlled and applied it to the balance. 	Id. at *1. 	Ohendalski eventually
paid the rest. 	Id. 	The Court barred Ohendalski from challenging those
liabilities via an administrative claim because, “consistent with his past
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conduct” in the Tax Court, Ohendalski had “refused” opportunities to “rebut
the facts, ... essentially defaulting on the claim.” Id. at *3.
More than a year later, Ohendalski filed this suit seeking income tax
refunds under 26 U.S.C. § 7422(a) for the same three tax years: 2002, 2003,
and 2004. 	Dkt. 1 at 1. 	The Government moved to dismiss the complaint,
invoking res judicata. 	See Dkt. 6. 	Ohendalski responded, Dkt. 7, and the
Government replied, Dkt. 8. The motion to dismiss is ripe for resolution.
Legal standard
To survive dismissal under Rule 12(b)(6), a party must plead “enough
facts to state a claim to relief that is plausible on its face.” 	Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). 	“A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” 	Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556).
An affirmative defense can provide grounds for dismissal under Rule
12(b)(6) if the defense is established on the face of the pleadings. 	See Kansa
Reinsurance Co. v. Cong. Mortg. Corp. of Tex., 20 F.3d 1362, 1366 (5th Cir.
1994). 	When conducting this inquiry, the Court can consider documents
referenced and incorporated in the complaint and any facts for which judicial
notice is appropriate. See Funk v. Stryker Corp., 631 F.3d 777, 782-83 (5th Cir.
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2011) (affirming judicial notice of publicly available documents containing
matters of public record when resolving Rule 12(b)(6) motion).
Analysis
The Government argues Ohendalski’s suit is barred by res judicata.
According to the Government, Ohendalski’s tax liabilities for the relevant
years were resolved by the Tax Court in 2012 and by this Court in 2024. Dkt.
6 at 8. Ohendalski responds that res judicata does not apply, both because the
Tax Court decision was entered pursuant to a settlement, and because his
refund suit is a distinct cause of action. 	See Dkt. 7 at 2-3. 	Ohendalski is
incorrect on both fronts, and his case should be dismissed.
“The preclusive effect of a prior federal court judgment is controlled by
federal res judicata rules.” 	Ellis v. Amex Life Ins. Co., 211 F.3d 935, 937 (5th
Cir. 2000). 	Federal law “bars the litigation of claims that either have been
litigated or should have been raised in an earlier suit.” Duffie v. United States,
600 F.3d 362, 372 (5th Cir. 2010) (quotation omitted).
“To preclude parties from contesting matters that they have had a full
and fair opportunity to litigate protects their adversaries from the expense and
vexation attending multiple lawsuits, conserves judicial resources, and fosters
reliance 	on 	judicial 	action 	by 	minimizing 	the 	possibility 	of 	inconsistent
decisions.” 	Montana v. United States, 440 U.S. 147, 153-54 (1979). 	Thus,
“[d]ismissal of a claim based on res judicata is proper if (1) the parties are
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identical or in privity; (2) the judgment in the prior action was rendered by a
court of competent jurisdiction; (3) the prior action was concluded by a final
judgment on the merits; and (4) the same claim or cause of action was involved
in both actions.” 	Devins v. Armstrong, 161 F.4th 922, 926 (5th Cir. 2025)
(quotation omitted). Here, all the res judicata requirements are met.
Ohendalski does not dispute the first two res judicata elements. 	This
suit involves the same parties as the previous two decisions. Both the U.S. Tax
Court and this Court also had jurisdiction to render their judgments. 	See 26
U.S.C. § 6214(a) (conferring jurisdiction on the Tax Court “to redetermine the
correct amount of the deficiency”); id. § 7402(a) (stating that federal district
courts have jurisdiction “to render such judgments ... as may be necessary or
appropriate” to enforce “internal revenue laws”); 28 U.S.C. § 1340 (granting
jurisdiction over civil actions arising under federal tax laws).
As to the third element, Ohendalski argues that the Tax Court did not
enter 	a 	final 	judgment 	on 	the 	merits 	because 	its 	decision 	hinged 	on 	a
settlement agreement. 	Dkt. 7 at 2. 	For res judicata purposes, however, a
judgment reached by agreement is nonetheless “entitled to full res judicata
effect.” 	See Matter of Teal, 16 F.3d 619, 621-22 (5th Cir. 1994) (further
observing 	that 	“simply 	because 	the 	Tax 	Court 	decision 	was 	reached 	by
agreement does not mean that Teal’s income tax was not resolved by a final
judgment on the merits for the purposes of res judicata”) (alterations and
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quotation omitted); see also Matter of West Tex. Mktg. Corp., 12 F.3d 497, 500-
01 (5th Cir. 1994) (giving preclusive effect to a judgment entered pursuant to
the taxpayer’s settlement agreement with the IRS). Settled law confirms that
the Tax Court’s decision is preclusive.
Regarding the fourth res judicata element, Ohendalski argues that this
refund suit is a distinct cause of action from the claims in the earlier two suits.
Dkt. 7 at 2-3. 	That does not matter for res judicata purposes because federal
courts apply a “transactional test” that examines whether the prior and
current suits “were based on the same nucleus of operative facts.” Eubanks v.
Fed. Deposit Ins. Corp., 977 F.2d 166, 171 (5th Cir. 1992) (quotation omitted).
The transactional test can be met even if two suits seek different relief,
advance different theories, or assert different rights. 	See United States v.
Davenport, 484 F.3d 321, 326 (5th Cir. 2007). 	Moreover, “[i]n federal tax
litigation one’s total income tax liability for each taxable year constitutes a
single, unified cause of action, regardless of the variety of contested issues and
points that may bear on the final computation.” 	Finley v. United States,
612 F.2d 166, 170 (5th Cir. 1980).
Both the earlier and current suits involve the same “unified cause of
action,” namely, how much income tax Ohendalski owed for 2002, 2003, and
2004. 	Id. 	at 	170. 	Ohendalski 	cannot 	avoid 	res 	judicata 	simply 	by
characterizing this latest suit as a refund case. 	Insisting that he is owed a
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refund is merely the inverse of the Government’s position—on which the
Government prevailed—that Ohendalski owes taxes for the same three years.
Because Ohendalski had ample opportunity to dispute the quantum of taxes
owed for those three years both before the Tax Court and in the Government’s
prior suit against him, he is barred from doing so again here.
Ohendalski’s cited decisions do not open the door to relitigating his tax
liabilities because they addressed a different preclusion doctrine: collateral
estoppel. 	Collateral estoppel, or issue preclusion, precludes a party from
relitigating questions actually and necessarily decided in a prior suit. 	See
Meador v. Orxy Energy Co., 87 F. Supp. 2d 658, 663 (E.D. Tex. 2000). 	The
relevant doctrine here, however is res judicata, or claim preclusion, which
applies not only to claims that were litigated in a prior suit, but also those that
could have been raised at that time. 	See Test Masters Educ. Servs., Inc. v.
Singh, 428 F.3d 559, 571 (5th Cir. 2005).
The decisions cited by Ohendalski recognize that distinction. In United
States v. International Building Co., 345 U.S. 502 (1953), the Supreme Court
analyzed stipulated judgments resolving a taxpayer’s liability for three specific
tax years. 	Id. at 504. 	Because the parties had not litigated the issue of
depreciation in their previous cases, the Court held that collateral estoppel did
not bar the Commissioner from raising the depreciation issue in a new suit
addressing other tax years. 	Id. at 505-06. 	Contrast that with the Court’s
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observation about claim preclusion: “Certainly the judgments entered are res
judicata of the tax claims for the years 1933, 1938, and 1939” that the previous
cases had addressed, “whether or not the basis of the agreements on which
they rest reached the merits.” Id. at 506.
The Supreme Court noted an analogous distinction in Commissioner of
Internal Revenue v. Sunnen, 333 U.S. 591, 599-601 (1948). 	There, the Court
recognized that collateral estoppel does not always preclude a taxpayer from
seeking a new determination on a legal issue when the previous and current
cases “involve income taxes in different taxable years” or “the relevant facts in
the two cases are separable ....” Id. at 599, 601. But again, the Court declared
that “a judgment on the merits is res judicata as to any subsequent proceeding
involving the same claim and the same tax year.” Id. at 598 (emphasis added).
This suit is precisely the type of case that both International Building
and Sunnen recognize would be barred because it involves the same tax
liabilities for the same years that earlier cases addressed and resolved. 	Res
judicata forbids Ohendalski from attempting to raise yet another challenge to
those liabilities. This Court should grant the Government’s motion to dismiss.
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Recommendation
For 	the 	foregoing 	reasons, 	it 	is 	RECOMMENDED 	that 	the
Government’s motion to dismiss (Dkt. 6) be GRANTED, and that Ohendalski’s
claims be DISMISSED WITH PREJUDICE.
The parties have fourteen days from service of this Report and
Recommendation to file written objections. 28 U.S.C. § 636(b)(1); Fed.
R. 	Civ. 	P. 	72(b). 	Failure 	to 	file 	timely 	objections 	will 	preclude
appellate review of factual findings and legal conclusions, except for
plain error. 	Ortiz v. City of San Antonio Fire Dep’t, 806 F.3d 822, 825
(5th Cir. 2015).
Signed on January 29, 2026, at Houston, Texas.
______________________________
Yvonne Y. Ho
United States Magistrate Judge
n, Texasss..
___________________________________________
Yvon	n	nn	n	nee Y. Ho
Uniiiitteed States M	M	M	Magistrate Judge
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