Werner Heisenberg (1901-1976) was a physicist, not an engineer. But his famous uncertainty principle is the model for Judge Travis A. (“Tag”) Greaves’ exhaustive (not to say exhausting) review of the Section 41 additional research credits claimed by Phoenix Design Group, Inc., T. C. Memo. 2024-111, filed 12/23/24.

The Phoenixes are MEPF (mechanical, electrical, plumbing and fire prevention) engineers of great skill and high repute. Only their experimentation to solve uncertainty fails to show both what was uncertain and what they did to resolve the uncertainty. They had timesheets galore, but few details thereon. And their meticulous drawings confounded even their attorneys. “As aptly summarized by petitioner’s counsel, the unexplained design drawings ‘tell[] me nothing.’” T. C. Memo. 2024-111, at p. 36.

Just solving problems isn’t enough. The Phoenixes are masters of that. The scientific method is the key to the credit. And explaining it to a judge is essential.

As Judge Greaves sums it up. “As said before, engineers solve problems you did not know you had in ways you cannot understand. Without an explanation of the work or process of the engineers, we cannot understand how PDG engineers came to the ultimate solutions and determine whether the activities qualify as research within the meaning of section 41. None of the trial projects as a whole or at the shrinking-back level involved qualified research. Petitioner is liable for the accuracy-related penalties as stipulated by the parties.” T. C. Memo. 2024-111, at p. 45.