The fight between Ralph Bradbury and the Internal Revenue Service has now entered Round 3.
If you recall, Bradbury was the president of Continental Express Inc. of Little Rock before the company’s assets were sold in December 2008. In October 2010, Bradbury was hit with a gigantic tax bill for unpaid employment taxes tied to Continental and has been fighting the bill — which now stands at $800,000 — ever since.
Bradbury sued the IRS in November, maintaining that the owners of the company, Little Rock businessman Ed Harvey and his wife, Bonnie, or their financial adviser, Marvin Jones of Little Rock, should be stuck with the bill.
In a new filing last week in U.S. District Court in Little Rock, Bradbury added new ammunition to his argument that he didn’t control the finances of the company immediately before the sale.
In documents released to him under the federal Freedom of Information Act, Bradbury shows that the IRS was dealing directly with Continental CFO James Dodd. And the IRS wanted to speak with Ed Harvey in the fall of 2008. Sometime in October 2008, Harvey was supposed to arrange a meeting with IRS Officer James Davies.
At that meeting, Harvey would have been under oath and would have had to explain his income, expenses, assets and liabilities.
“The [IRS] transcript does not record that Harvey, the owner, ever complied with these instructions,” Bradbury’s filing said.
The IRS took no action until January 2009, when the case was reassigned to Revenue Officer Bobby Blackman. It still took almost two years for the IRS to send a bill.
Bradbury’s filing also includes a document from Bonnie Harvey and Jones, the financial adviser. They had hired Brandon Frederick of Texarkana on Dec. 10, 2008, to collect any outstanding receivables of Continental. Under the terms of the contract, the money should be used for “employment payroll first and then the IRS trust fund deductions.”
The IRS has countersued Bradbury in an attempt to get the bill paid. The IRS and Bradbury have each asked that the other’s lawsuit be dismissed.
Family Ties
As you may know, Ed Harvey’s son-in-law is U.S. Sen. Mark Pryor, D-Ark. (And Ralph Bradbury’s daughter, Rachel, is publisher of consumer publications for Arkansas Business Publishing Group.)
Carlton Saffa, chairman of a super PAC set up last month for the purpose of defeating Pryor should he seek re-election in 2014, has accused Pryor of using “his powerful position to shield his wealthy mother-in-law from $2 million in federal taxes owed by a company she owned.”
But Pryor’s spokesman Michael Teague maintains that Pryor has not intervened on the Harveys’ behalf.
“It begs the question why we’re even mentioned in these stories,” Teague said. “Where’s the evidence?”
He said Pryor wasn’t mentioned in the lawsuit.
He said the IRS was going after Ralph Bradbury because of the IRS’ statute, which calls for it to go after the “responsible person” of a company.
“I don’t know how more clear I can be: We’ve had no dealings with the IRS, the Harveys or anyone else involved in this, including the Bradburys,” Teague said.
