In Uncategorized on 02/20/2018 at 15:35

That ever-obliging jurist, Judge David Gustafson, echoing the words of Neil Diamond some 49 years ago, exercises saintly patience, and again tries to school IRS counsel, who unlike the petitioner communicates with Judge Gustafson, albeit not entirely to the point. And it’s once again the Chapter-imposed shootdown of the settlement agreement in Cecil K. Kyei, Docket No. 9118-12, filed 2/20/18.

Y’all will recall CKK’s bankrupt manœuvers. No? Well, dig my blogpost “Obliging But Befuddled,” 1/26/18. And eyeball today’s installment above-cited.

OK, so Judge Gustafson did correct the erroneous date in his order, which gave rise to my above-cited blogpost. But then IRS failed to tell Judge Gustafson how the settlement agreement, which CKK’s bankruptcy stay voided, could be the basis for entry of decision. IRS now moves to enter decision based on the SNODs for two of the three years at issue, cutting the deficiency alleged in SNOD no. 3, and asking for reduced chops.

“Unlike his first such motion, it was complete, with no pages missing. Like the first motion, the second motion for entry of decision asks us to enter decision on the basis of the June 2015 agreement.” Order, at p. 2

Judge Gustafson, positively exuding benevolence toward an attorney clearly out of his/her depth (or perhaps oblivious to that 800-pound gorilla wearing a t-shirt emblazoned with “11USC§362(a)(8)” in day-glo orange letters 12 inches high), decides to treat the motion as one to dismiss for lack of prosecution.

CKK has dropped out of sight, perhaps better to prepare his next bankruptcy petition.

So maybe IRS will finally nail CKK, despite counsel’s somewhat less than stellar performance. Judge Gustafson has his hand and invitation extended.

But wait, there’s more.

“One issue requires supplementation: Although the motion makes a showing of compliance with section 6751(b)(1) as to the penalties for 2008 and 2009, with a ‘Civil Penalty Approval Form’ dated ‘12/20/11’, the motion makes no such showing as to the penalty still asserted for 2010, in the amount of $2,614.80. We do not know whether this omission as to 2010 was an oversight, or whether the Commissioner takes the position that section 6751(b)(1) does not apply to the penalty at issue here, or takes the position that a movant under Rule 123(b) does not bear a ‘burden of production’ pursuant to section 7491(c). We will require the Commissioner to explain his position on this issue.” Order, at pp. 3-4.

I’ll drop a wee hint to IRS’ counsel: watch the Rule 123(a) vs Rule 123(b) distinction. See my blogpost “Defaulters,” 5/27/14, and the cases therein referred to. Remember that post-Graev burden of production may be burden of proof, at least in 2 Cir.



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