In Uncategorized on 05/24/2017 at 16:35

Keith Howard Johnson, Esq., and associates strove mightily for Christina M. Fitzpatrick, 2017 T. C. Memo. 88, filed 5/24/17. Their labors and lucubrations paid off, as they rescued Christine from the TFRPs unloaded on her by an overzealous revenue officer and corporate officers of dubious credibility.

For the backstory on Christina and her troubles, see my blogpost “Grape of Wrath,” 11/2/16.

But Judge Vasquez, protector of the fisc, slices and dices Keith Howard’s well-earned fee.

First of all, IRS only had the benefit of the record, replete with “misinformation,” to put it charitably. So IRS was substantially justified when it issued the TFRPs and at the CDP.

But Keith Howard dropped a qualified offer; see Section 7430(c)(4)(E)(i). And the qualified offer was more than IRS got after trial.

So IRS (that means us, fellow taxpayers) is on the hook for what happened after IRS did nothing with the qualified offer. For Keith Howard, the past is prologue, and he can eat those hours.

Keith Howard argues his special expertise and thirty years of combat time to beat the hourly cap, but that’s a nonstarter. This case was strictly facts; blow up the corporate officers and the RO, and you’re a winner.

Then too, there were a couple other qualified lawyers (hi, Judge Holmes) who could have represented Christine adequately, so no special uniqueness bonus there.

Keith Howard claims this was an “undesirable” case, but the Supremes have held that is not a special factor. As a much higher Authority put it, “In the sweat of thy face shalt thou eat bread.”

Finally, Keith Howard argues that IRS took an unusually litigious position. And there’s an 11th Cir case that remanded a USDC decision awarding enhanced fees to consider the unusually litigious issue.

Yes, but, says Judge Vasquez.

A lot of courts have dealt with the unusually litigious position argument, and it hasn’t flown. “Most of the courts have concluded that an unusually litigious position cannot be considered a special factor because it would amount to ‘an impermissible award of punitive damages, contrary to the statute and to principles of sovereign immunity.’” 2017 T. C. Memo. 88, at p. 13 (citations omitted).

So what might get a private litigant (or their counsel) a Section 6673 chop, only gets Keith Howard and crew some more hours.

Judge Vasquez of course chops copying costs and the 6.5 hours Keith Howard spent on a FOIA request.

Keith does get $179,049.70.

I leave it to my colleagues to decide whether such compensation for self and two associates, after intake interviews and information gathering, a letter 12153 to Appeals, a CDP, a petition from a NOD, Branerton and formal discovery, motions, trial prep, and a seven-day Tax Court trial, all over several years with overhead to pay, evokes more than a grim smile.

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