Opinion
9254-19 12049-19 12718-19
11-20-2023
MONTGOMERY-ALABAMA RIVER, LLC, PARKWAY SOUTH, LLC, TAX MATTERS PARTNER, ET AL., Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Albert G. Lauber Judge
These cases, involving charitable contribution deductions claimed for conservation easements, are calendared for trial during a two-week special trial session beginning on August 19, 2024, in Atlanta, Georgia.[ On September 1, 2023, we issued a Pretrial Order setting June 24, 2024, as the date for exchanging opening expert witness reports and expert workpapers relating to opening expert reports. Our Order defined expert workpapers to include (among other things) "any facts, data, documents, or other information considered by the expert witness in forming the opinions to be offered by the expert."
Absent stipulation to the contrary, these cases are appealable to the U.S. Court of Appeals for the Eleventh Circuit, and we thus follow its precedent. See Golsen v. Commissioner, 54 T.C. 742, 756-57 (1970), aff'd, 445 F.2d 985 (10th Cir. 1971).
On May 25, 2023, petitioners served on respondent a Fourth Request for Production of Documents and a Fifth Set of Interrogatories. Respondent declined to produce the requested information, urging (among other reasons) that the information was protected by the attorney-client, attorney work product, and deliberative process privileges. See Tax Court Rule 70(b)(1), (c)(3). On September 12, 2023, petitioners filed a Motion to Compel Discovery, urging the Court to order respondent "to produce all documents requested in Petitioners' Fourth Request for Production of Documents and to answer in full all interrogatories in Petitioners' Fifth Set of Interrogatories."
By Order served September 15, 2023, we denied petitioners' Motion. We held:
(1)"To the extent petitioners seek information compiled by respondent's counsel, that information is protected (at least) by the deliberative process privilege and the work product doctrine";
(2)"To the extent petitioners seek information compiled by persons who may be called by respondent as expert witnesses, the Motion is (at best) premature. If respondent does not call those persons as witnesses, any material those persons may have compiled is protected by the work product doctrine and is nondiscoverable"; and
(3)"To the extent petitioners seek information compiled by persons who are called by respondent as expert witnesses, petitioners are not entitled to receive information from those experts before June 24, 2024, when opening expert reports and expert workpapers are required to be exchanged."
In making these determinations, we relied (in part) on our understanding that petitioners were seeking the names and contact information of persons whom respondent or his experts had informally interviewed in connection with these cases, and any notes, recordings, transcripts, memoranda, or records of any such interviews.
On October 6, 2023, petitioners filed a Motion for Reconsideration of our September 15 Order. First, petitioners contend that our Order "is based upon a substantial error of fact because the Court appeared to have misunderstood the discovery requests." Petitioners assert that the information described above was "purposely excluded" from their formal discovery requests. Rather, petitioners allegedly seek only "non-privileged, third-party documents in [r]espondent's possession that were not acquired through the work or investigation being performed by [r]espondent's experts." Second, petitioners contend that the Court committed a "substantial error of law" in ruling that the identities and contact information of possible third-party witnesses are nondiscoverable. Petitioners assert that this information is discoverable under Eleventh Circuit precedent. See Castle v. Sangamo Weston, Inc., 744 F.2d 1464, 1467 (11th Cir. 1984) (holding that the names and addresses of witnesses interviewed are "subject to discovery").
On November 9, 2023, respondent filed a Response to petitioners' Motion for Reconsideration. He contends that he has fully complied with petitioners' discovery requests because he has yet to obtain "any documentary evidence from any third-party witness that would be responsive to [p]etitioners' Requests." He represents that all relevant documents currently in his possession were obtained directly from petitioners. See Rosenfeld v. Commissioner, 82 T.C. 105, 115 (1984) (holding that a party need not produce documents he does not have in his possession, custody, or control). A party cannot provide information or documents he has yet to obtain.
See Tax Court Rule 72(a)(1) (a party is required to produce documents to the extent they are in their possession, custody, or control).
Second, respondent represents that he has not yet identified any witnesses (other than expert witnesses) whom he intends to call at trial. In any event, the identities and contact information of possible third-party fact witnesses would be discoverable under Eleventh Circuit precedent only if petitioners demonstrated "substantial need" or "undue hardship," which they have not done. See Tax Court Rule 26(b)(3); Ratke v. Commissioner, 129 T.C. 45, 50 (2007); cf. Castle, 744 F.2d at 1467 (holding that witness names and addresses are discoverable when a party can demonstrate substantial need for the early production of this information). Respondent acknowledges that he must inform petitioners of the names and contact information of any parties to whom he issues subpoenas, see Tax Court Rule 147(1)(A)(3), but represents that he "has not issued subpoenas to any third-party witnesses or potential witnesses to date." Finally, as we explained in our prior Order, petitioners are not entitled receive information from respondent's expert witnesses until June 24, 2024, the date the Court has set for exchanging opening expert witness reports and expert workpapers.
We generally do not exercise our discretion to grant reconsideration absent a showing of substantial error or unusual circumstances. See Estate of Quick v. Commissioner, 110 T.C. 440, 441 (1998); CWT Farms, Inc. v. Commissioner, 79 T.C. 1054, 1057 (1982), aff'd, 755 F.2d 790 (11th Cir. 1985). Petitioners' Motion does not come close to satisfying this high standard. See Estate of Quick v. Commissioner, 110 T.C. 440, 441 (1997); Brannon's of Shawnee, Inc. v. Commissioner, 69 T.C. 999, 1000-01 (1978). As we explained in Berenblatt v. Commissioner, we "cannot compel discovery of nonexistent information . . ., nor will [the Court] sanction fishing expeditions." No. 7208-17W, 2023 U.S. Tax Ct. LEXIS 2467, 160 T.C., slip op. at *23 (May 24, 2023) (citing Tax Court Rule 70(c)).
Upon due consideration, it is ORDERED that petitioners' Motion for Reconsideration of Order, filed October 6, 2023, is denied.