Attorney-at-Law

NOW YOU DON’T SEE HIM, NOW YOU DO

In Uncategorized on 03/23/2017 at 14:53

Or it might be her. In either case, Mr/Ms. Whistleblower, the anonymity Tax Court grants you today may be whisked away tomorrow.

It’s all about the public’s right to know who is using the courts…even at the risk of their lives. Remember my blogpost “The Whistleblower Blown Up,” 5/20/14; whistleblowing could be hazardous to your health, whatever the outcome of the current political struggle over healthcare.

Judge Halpern deals with this in Whistleblower 12568-16W, 148 T. C. 7, filed 3/22/17. I was so caught up with 2 Cir. putting Graev in the grave yesterday, and a routine medical checkup, that I missed this one.

The blower in question, hereinafter BIQ, claims he handed the Federales beaucoup good stuff about a billion-dollar tax dodge, but got nothing but an Ogden brush-off. He petitions, and at the same time moves for anonymity.

BIQ further claims as follows. “…if petitioner’s identity were disclosed, petitioner would be at risk of retaliation, physical harm, social and professional stigma, and economic distress.  Petitioner supported the motion with a declaration, in which, among other things, petitioner represents the following. Petitioner was previously employed by an entity related to the taxpayer.  Petitioner’s claims concern significant unlawful tax code violations by the taxpayer and affiliates.  Petitioner acquired knowledge about the violations in the normal course of petitioner’s employment.  Petitioner has a well-founded concern that disclosure of petitioner’s identity would cause the taxpayer to retaliate against petitioner and petitioner’s family, resulting in professional and personal ostracism, economic loss, and even threats to petitioner’s family’s safety.  Disclosing petitioner’s identity would also likely cause severe damage to petitioner’s standing in petitioner’s professional community, as well as embarrassment both professionally and personally.” 148 T. C. 7, at p. 3.

IRS is down with this, but Judge Halpern, mindful that the Great American Public is panting, breathless, to know BIQ’s identity, must needs resolve the competing social interests at stake.

It’s early times, so if BIQ gets blown off on summary J (IRS says “we got nuttin’”), no big public interest, so let BIQ stay behind the curtain. But if things heat up, Rule 345 might let Judge Halpern pull the veil; for example, if there’s a big award to BIQ, the public might really like to know. See the Committee comment to Rule 345, at 148 T. C. 7, at p. 6.

I point out that so would the blown like to know, and if they did, BIQ’s life and health insurers would do well to cancel him/her, likewise whatever the outcome of today’s political struggle.

“Given that the redaction of information identifying the nonparty taxpayer that is generally required by Rule 345(b) is only provisional, the discretionary protection that a whistleblower receives from the granting of a motion to proceed anonymously must, a fortiori, be provisional as well.  Although Rule 345(a) does not specifically contemplate revocation of anonymity initially granted, it must follow that the Court’s discretion to either grant or deny a motion to proceed anonymously also encompasses the authority to condition any relief granted on appropriate conditions.” 148 T. C. 7, at pp. 6-7.

And in each of the three previous cases Tax Court has decided (and I’ve blogged them), the blower’s identity was concealed pending further order of the Court.

But here’s the point, BIQ and other would-be blowers. “It is only fair that we inform petitioner that the balance that we now find to weigh in favor of anonymity may change, so that petitioner may take that risk into account in deciding whether to proceed with the action.” 148 T. C. 7, at p. 9.

So if you walk away and shut up, letting the crooks get away, you’re safe. But if you go ahead, connect the dots, blow the doors off the banditi, help out the honest taxpayers, at the risk of your life and your family’s lives, and prove you should get compensated for this, you’re at risk that your name gets plastered all over, with the results you predicted.

Great incentive, Judge.

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