William Scott, proceeding pro se, applied for a whistleblower award under 26 U.S.C. § 7623(b) by submitting a Form 211 to the Internal Revenue Service. The statute provides that whistleblowers may receive between fifteen and thirty percent of the amount collected if their information leads to enforcement action. The IRS denied Scott's application, stating that his information did not result in any collected proceeds. Scott then filed a lawsuit in the United States District Court for the Southern District of Florida, seeking an injunction to compel the IRS to investigate his application. He framed the suit as arising under the Administrative Procedure Act (APA). The district court dismissed the complaint for lack of subject matter jurisdiction, relying on the Eleventh Circuit's precedent in Stone v. Commissioner, which held that the IRS's decision on whistleblower claims is committed to agency discretion. While Scott's appeal was pending, he filed a renewed motion for remand citing new evidence from the 2026 release of the Epstein documents, but he also raised a separate claim that the district judge should have recused herself due to alleged systemic bias in the federal judicial system.
The Eleventh Circuit reviewed the dismissal de novo and the recusal decision for abuse of discretion. On the jurisdictional issue, the court addressed Scott's argument that the APA's waiver of sovereign immunity allowed his suit. The court explained that while the APA generally waives sovereign immunity, that waiver does not apply when 'agency action is committed to agency discretion by law' under 5 U.S.C. § 701(a)(2). Citing Stone v. Commissioner, the court reaffirmed that the IRS's decision not to take enforcement actions pursuant to a whistleblower claim falls squarely within this exception. Because Scott did not attempt to distinguish Stone, the court was bound by precedent to affirm the dismissal. Consequently, the court declined to address Scott's substantive argument that the IRS's denial was arbitrary and capricious. Regarding the recusal claim, the court noted that Scott relied on an alleged 'extra-judicial dismissal pattern' reflecting systemic bias. However, the court clarified that to succeed on a recusal motion, a party must demonstrate that the alleged bias is 'personal as opposed to judicial in nature.' Citing Jaffree v. Wallace, the court emphasized that appellants must show personal, extrajudicial bias, not merely a disagreement with a judge's philosophy. Since Scott offered no evidence of personal bias against the district judge, the court found no abuse of discretion in the judge's refusal to step down.
The decision affirms that the IRS retains broad discretion over whistleblower award determinations, effectively shielding these decisions from judicial review under the APA. This preserves the sovereign immunity of the United States in this context. The dismissal is without prejudice to Scott's ability to seek administrative remedies within the IRS, though the court's ruling suggests that further administrative appeals are unlikely to succeed if the core issue remains the IRS's discretion. The ruling also reinforces the high bar for recusal motions, requiring proof of personal bias rather than general dissatisfaction with judicial outcomes.