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United States v. Black

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA


July 6, 2010

UNITED STATES OF AMERICA, AND CHUNG NGO, REVENUE OFFICER, INTERNAL REVENUE SERVICE, PETITIONERS,
v.
DAVID W. BLACK, RESPONDENT.

The opinion of the court was delivered by: Kendall J. Newman United States Magistrate Judge

ORDER

Presently before the court is petitioners' ex parte application to shorten time, which requests that the court advance the date of the show-cause hearing on petitioners' verified petition to enforce an Internal Revenue Service ("IRS") summons. (Dkt. No. 4.) The court's previously entered order to show cause ("OSC") set a hearing date of August 12, 2010 (Dkt. No. 3), and petitioners seek to advance that hearing to take place on or before July 29, 2010. For the reasons that follow, the undersigned will deny petitioners' ex parte application to shorten time.

Petitioners seek to advance the OSC hearing date because "the IRS expects the documents requested in the IRS summons to be needed for a Tax Court action around September." (Ex Parte Application at 1.) It appears from petitioners' counsel's declaration that "the IRS expects respondent to file a petition in the United States Tax Court" at some unspecified time, and that the IRS might need to file an answer in such an action "between early September and early October." (See Himel Decl. ¶ 2.) Petitioners' counsel declares that the August 12, 2010 hearing date would not allow enough time for petitioners to: (1) obtain an order enforcing the IRS summons, assuming a result favorable to petitioners; (2) schedule a compliance appointment with respondent; and (3) prepare an answer or formulate a position as to the potential Tax Court petition with the aid of the documents responsive to the IRS summons. (See id. ¶¶ 4, 10.) Accordingly, petitioners seek to advance the OSC hearing date by two weeks so that they might, assuming a result favorable to them, obtain documents more expeditiously.

The undersigned concludes that petitioners' application to shorten time should be denied for several reasons. First, as a procedural matter, petitioners' ex parte application does not comply with the court's Local Rules. Specifically, Local Rule 144(e) provides: "Ex parte applications to shorten time will not be granted except upon affidavit of counsel showing a satisfactory explanation for the need for the issuance of such an order and for the failure of counsel to obtain a stipulation for the issuance of such an order from other counsel or parties in the action" (second emphasis added). The declaration of petitioners' counsel does not contain an explanation, let alone a "satisfactory explanation," for counsel's failure to obtain a stipulation from respondent regarding advancement of the hearing date on the OSC. The undersigned cannot ascertain from the application and declaration whether petitioners even attempted to obtain a stipulation from respondent. For this reason alone, petitioners' ex parte application should be denied.*fn1

Second, and notwithstanding any procedural deficiency, the undersigned will deny the ex parte application because petitioners appear to be seeking relief from a problem or circumstance that does not yet exist. Petitioners' ex parte application is premised on the IRS's "expectation" that respondent will file a petition in the United States Tax Court, which might require the IRS to file an answer in that proceeding "between early September and October." (Himel Decl. ¶ 2.) Petitioners predicate their need for ex parte relief on what respondent might do in the future, not a set of circumstances that presently exists. Petitioners have not submitted a copy of petition filed in the Tax Court, or citations to legal authorities prescribing when the IRS would be required to answer such a petition, if one is ever filed. Simply put, the undersigned will not grant ex parte relief and advance the OSC hearing based on a hypothetical set of facts.

Third, petitioners' potential timing problem is largely a problem of their own making in that the court adopted service and briefing requirements proposed by petitioners. In connection with their petition, petitioners requested that the court issue an order to show cause with a hearing date of July 29, 2010. (Verified Petition at 1, Dkt. No. 2.) However, petitioners also requested that they be permitted 21 days from the date of the order to show cause, if one issued, to serve respondent with the order, the Verified Petition, and related documents. (Id. at 2:7-12.) In addition, petitioners requested that respondent be obligated to file a written opposition to the Verified Petition, if any, at least ten days prior to the hearing on the proposed order to show cause. (Id. at 3:1-3.) Assuming that the court set a show cause hearing date of July 29, 2010, issued an order to show cause dated June 18, 2010,*fn2 and adopted petitioners' proposed briefing schedule, and assuming that petitioners served respondent on the twenty-first day, respondent would have been served on Friday, July 9, 2010, and would have to file a written opposition no later than Thursday, July 15, 2010. This would have afforded respondent, who might need or want to retain counsel, seven calendar days, at most, to prepare an opposition. Given this constricted window within which plaintiff would be obligated to prepare a written opposition, the undersigned set the OSC hearing for August, 12, 2010. (OSC at 1.) The undersigned also required that respondent file a written opposition, if any, at least 14 days prior to the hearing. (Id. at 3:5-8.) Taken together, and assuming that petitioners use all of the time permitted to serve respondent, this briefing schedule grants respondent at least 20 days to prepare and file an opposition to the Verified Petition. The undersigned adopted much of petitioners' proposed service and briefing requirements, but set a more reasonable hearing date than that which was requested.

Finally, the undersigned also notes that petitioners' application, the accompanying affidavit, and the court's docket do not reflect that petitioners have acted with haste to effectuate service of the OSC and related documents prior to filing their ex parte application or prior to expiration of the 21-day service period prescribed in the OSC.*fn3 (OSC at 2:7-12.) This suggests that petitioners are not confronted with an imminent timing problem insofar as respondent's potential filing in the Tax Court is concerned. One might expect petitioners to effectuate service as soon as possible in order to mitigate any potential prejudice that respondent might face with respect to preparation of an opposition to the petition on shortened time.

For the foregoing reasons, IT IS HEREBY ORDERED that petitioners' application to shorten time is denied.*fn4


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