In Uncategorized on 06/03/2016 at 16:54

You too, ladies, although the exalted author of the title of this feuilleton was rather discourteous.

Anyway, that’s where The Great Dissenter, a/k/a The Judge Who Writes Like a Human Being, s/a/k/a The Inexhaustible, Indefatigable, Ineluctable, Incontrovertible, Ineffable, Implacable and Industrious Foe of the Partitive Genitive, His Honor Judge Mark V. Holmes, leaves us at the close of play in another potter’s tale, Golden State Cooperative, Inc., Docket No. 2502-15, filed 6/3/16.

E-discovery CLEs are great for geeks, and a good place to get some hours and some shuteye for the rest of us, provided only we neither snore nor rant. See my blogpost “Continuing Legal Education,” 2/22/16.

Anyway, the Golden Staters claim their enterprises do not “consist of” flogging certain flora to the medicinally-challenged, and have some summaries derived from their surveillance cameras to show their non-flogging.

Now FRE 1006 says summaries are fine, but the other side gets to eyeball the raw data whence the summaries flow.

The Golden Staters hand over flash drives that IRS’s geeks can’t open, so they ask the Golden State geeks to give them the hot flashes in such format as IRS can scope them out. The Golden State geeks say their software doesn’t talk to IRS’s software, and they can’t convert their entire IT system to make it so.

“The question here is whether producing copies of the original flash drives in the format in which they are kept is making them ‘available for examination or copying’ when the recipient cannot for technological reasons actually inspect or copy them.” Order, at p. 2.

The Golden Staters produced the raw goods, and Tax Court Rule 72(b) says usual form kept in ordinary course is good enough.


Tax Court Rule 72(a) says a party must produce in “reasonably usable form.”

“Is the language in Rule 72(a)(1) that lets the IRS ask petitioner to produce the information on IRS-compatible software amount to a requirement that it translate this information into a “reasonably useful form?” For help, we look to the Advisory Committee Notes for Federal Rule of Civil Procedure 34, the model for our Rule 72. It stresses that rules about the production of electronically stored information should ‘protect against deliberate or inadvertent production in ways that raise unnecessary obstacles for the requesting party.’ If petitioner could have produced these flash drives on Windows Media Player at little cost, we would construe Rule 72 and Federal Rule of Evidence 1006 to require it to do so. We also note that the Advisory Committee Notes observe that ‘the responding party may need to provide some reasonable amount of technical support, information on application software, or other reasonable assistance to enable the requesting party to use the information.’ Fed. R. Civ. Proc. 34 advisory committee’s note to 2006 amendment. Petitioner in this case has done so — and has even offered to try to make the footage viewable on a tablet.” Order, at p. 3.

But the Golden Staters haven’t done that yet. And where cost is involved, FRCP 34 kicks us over to FRCP 26(b)(2)(B), which says if it costs too much, the requester must pony up. The rule from back in 1974 still holds true: each party must finance its own lawsuit.

Now the Technological Age does make delivering vast quantities of information really cheap, so why do parties complain?

“But another defining characteristic of the current era is that much of this cheap information rapidly becomes costly or impossible to retrieve as advancing technology makes information stored only in legacy systems costly or impossible to access. We think the rule in such circumstances – if access can’t be had at a cost that is reasonable in the circumstances of the case (and here we note that the stakes in this case are less than $50,000) — then a responding party can do what petitioner did here; that is, offer to help with any technological problems but let the cost of making it usable fall on the requesting party.” Order, at p. 4.

So IRS doesn’t get to strike the summaries. And the techies on both sides can keep trying.


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