STJ Peter Panuthos has a gloss on the role of trial witnesses, both expert and inexpert (fact), in Michael A. Fiumara, Docket No. 1829-17, filed 4/27/22.

Mike wants his expert, whom I’ll call Ken, in as a witness, both as to report and on the stand. IRS says no, and STJ Panuthos goes with IRS.

“Opinion testimony is admissible if and because it will assist the trier of fact to understand evidence that will determine a fact in issue. See Fed. R. Evid. 702. Testimony of a proffered expert that expresses a legal conclusion does not assist the trier of fact and is not admissible. An expert who is merely an advocate of a party’s position does not assist the trier of fact in understanding the evidence or in determining a fact in issue. The determination of whether proffered expert testimony is helpful to the trier of fact is a matter within our sound discretion.

“It is not enough that a witness is qualified in some way related to the subject matter at hand. We have previously ruled that expert testimony about what the law is or that directs the finder of fact on how to apply the law in tax deficiency proceedings does not assist the trier of fact and is, thus inadmissible. Feinberg v. Commissioner, T.C. Memo. 2017-211, at *10; Fed. R. Evid. 702(a).” Order, at p. 2 (Citations omitted, but see my blogpost “Cohan and COGS,” 10/23/17 for the Feinberg story).

So Ken is out, right? Yes, as an expert. But not as a witness. There are fact questions about some of Mike’s bank deposits. “Having participated in the examination, [Ken]’s testimony may remain helpful to analyze whether some bank deposits should not have been included as income, relative to the fraud penalty.” Order, at p. 2, footnote 2.

Both IRS and Mike want a witness sequestered, per Rule 145. Mike wants a RA out, and IRS wants one of Mike’s witnesses (role unstated) out.

“The purpose of this rule is to prevent witnesses from tailoring their testimony and to minimize altered, uncandid testimony. Rule 145(a)(3) and Rule 615(3) of the FRE provide an exception to the exclusion for persons whose presence can be shown to be essential to the presentation of such party’s cause. Generally, the court has discretion in determining whether a witness falls within one of the exceptions.” Order, at p. 2 (Citations omitted).

And without telling us why, STJ Panuthos finds both the RA and Mike’s witness are essential to the presentation of the respective cases.

Takeaway One- Rule 145s are hard to win. There’s no jury to be misled by cooked-to-order or revised testimony. A Tax Court case, if properly Branertoned, should have which facts are disputed and the contentions of the parties in respect thereof nailed down. And Tax Court judges are used to sifting truth from witness blather.

Takeaway Two- Don’t rend your garments in mourning if your expert witness gets tossed. If s/he has personal knowledge of a disputed fact, s/he may be allowed as a fact witness, and then you can see what part of his/her testimony you can get in on the trial.