Michael Minns

[notorial dissent]

Anyone know anything about a tax case involving Continental Airlines Pilots and some kind of tax shelter or tax dodge. He is claiming a major victory against the IRS over. So far I haven't found anything verifiable on it other than the "we really wish it were true" variety.

[Nikki]

In Tax Court cases as follows, the IRS attorneys were found to have deceived the Court by making a deal with a small number of petitioners (the 'test' case) from a large number of consolidated cases. Minns was one of the plaintiffs' attorneys (as was Joe Izen)

TC Docket Nos. 9382-83, 15907-84, 40159-84, 30979-85, and 29643-86

Petitioners (the Dixons, DuFresnes, Owenses, and Hongsermeiers) are, along with one other couple -- the Youngs -- the remaining test case petitioners in the Kersting tax shelter litigation. That litigation arose from respondent's disallowance of interest deductions claimed by participants in various tax shelter programs promoted by Henry F.K. Kersting during the late 1970s through the 1980s. Under the test case procedure, most of the other Kersting program participants who had filed Tax Court petitions ("nontest case petitioners") entered into "piggyback" agreements in which they agreed that their cases would be resolved in accordance with the Court's opinion in the test cases.4 Eventually, more than 300 nontest case petitioners made periodic and/or lump sum contributions to a fund (hereafter, the "Defense Fund" or "Fund") created to share the cost of the test case litigation.5
Following a 3-week trial, the Court sustained virtually all of respondent's determinations in each of the test cases. See Dixon v. Commissioner, T.C. Memo. 1991-614 (Dixon II).6 Shortly thereafter, on June 9, 1992, respondent notified the Court that, prior to the trial of the test cases, respondent's trial attorney, Kenneth W. McWade (McWade), and his supervisor, Honolulu District Counsel William A. Sims (Sims), had entered into contingent settlement agreements with two of the test case petitioners (the Thompsons and the Cravenses) and had failed to disclose those agreements to their superiors, to the Court, or to the other test case petitioners or their counsel. Respondent asked the Court to conduct an evidentiary hearing to determine whether the undisclosed agreements had affected the trial of the test cases or the opinion of the Court. The Court denied respondent's request for an evidentiary hearing, entered decisions giving effect to the Thompson and Cravens settlements, and reentered or allowed to stand the decisions sustaining respondent's determinations against the other test case petitioners.

[LPC]

My recollection is that the Tax Court was willing to overlook what happened, but the 9th Circuit came down hard on both the IRS and the Tax Court, eventually ordering the IRS to offer the same deal to all taxpayers involved in the shelter that had been offered to the "test case" petitioners.

Notice that Minns really had very little to do with what happened, because it was the IRS itself that disclosed the wrongdoing by its lawyers (who were both either disbarred or suspended from the practice of law, I believe). Minns happened to be involved in a case that blew up because of IRS misconduct, and yet claims credit as though he did something special.

[Judge Roy Bean]

So often these kinds of stories amount to little more than touting a player setting a new record batting average in a game that was lost by a team without a win during the season.

[grixit]

Or took a bean ball and was allowed a walk to 1st, but no one was able to hit them in.

[Tax Man]

Or took a bean ball and was allowed a walk to 1st, but no one was able to hit them in.

Or reaching 2nd on a fielder's choice.

[.]

The very same guy got to 3rd on a balk and scored on a wild pitch.

No doubt the entire sequence has happened many times in pro baseball, but no baseball player would ever brag about it.

[jcolvin2]

Minns awarded fees related to the Kersting cases:

http://www.ustaxcourt.gov/InOpHistoric/ ... CM.WPD.pdf