Opinion
17076-21
03-28-2023
J L MINERALS, LLC, BEASLEY TIMBER MANAGEMET, LLC, TAX MATTERS PARTNER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Eunkyong Choi Special Trial Judge.
By Order dated March 24, 2023, the undersigned was assigned to review a document petitioner's counsel alleges he inadvertently provided to respondent on March 20, 2023, to determine whether the document is protected from disclosure by the work product doctrine. The parties submitted memoranda outlining this issue. For the reasons set forth below, we find that the document is protected from disclosure by the work product doctrine.
Background
This case concerns the denial of the conservation easement deduction petitioner reported in its federal income tax return for taxable year 2017.
Over the course of litigation, respondent issued subpoenas to certain kaolin mining companies in Georgia. Ultimately, the third-party companies produced responsive documents under a protective order issued by Judge Urda, which further required each third-party company to produce a witness that would testify at trial via Zoom, outside of public view. The witnesses are scheduled to testify on March 29, 2023.
The parties conducted the live portion of the trial in this case from February 27, 2023 through March 10, 2023, before Judge Urda.
Petitioner's counsel wrote a letter to counsel for Imerys (one of the subpoenaed third-party companies) dated February 3, 2023, in which he attempted to verify information about the case and discussed his strategy for examining the person who will testify on behalf of Imerys. Petitioner's counsel inadvertently disclosed the letter to counsel for respondent as an exhibit to be used at trial.
Discussion
Petitioner asserts that the letter to counsel for Imerys is attorney work product. Respondent asserts that because the letter was addressed to a third-party, it is not confidential and therefore is not work product. We agree with petitioner.
The letter outlines petitioner's counsel's strategy for examining the witness from Imerys. See Hickman v. Taylor, 329 U.S. 495, 510-511 (1947); Hartz Mountain Indus. v. Commissioner, 93 T.C. 521 (1989); P.T. & L. Constr. Co. v. Commissioner, 63 T.C. 404, 408 (1974) (the work product doctrine protects documents, interviews, statements, memoranda, correspondence, briefs, mental impressions, and tangible things prepared by an attorney in anticipation of litigation or trial). Communications between an attorney and a potential witness are protected. Hickman, 329 U.S. 495, 510-511. Since Hickman, Courts routinely protect communications between attorneys and potential witnesses. See Upjohn, 449 U.S. 383, 400-01 (1981) (attorney memoranda regarding witness statements protected by work product doctrine); In re Student Finance Corp., No. 02-11620-JBR, 2006 WL 348387 (E.D. Pa. 2006) ("Scripts of questions to be used in interviewing witnesses are core attorney work product, reflecting legal strategy and decision-making concerning the important areas of inquiry with particular types of witnesses."). Moreover, disclosure from one party to another party who "shares strong common interests" does not cause work product to lose protection. Fojtasek v. NCL (Bahamas) Ltd., 262 F.R.D. 650, 655 (S.D. Fla. 2009) (the parties exchanging information need not be parties to the same case; it is enough for the parties to potentially be subject to the same type of litigation). Petitioner and Imerys have strong common interests; they are both kaolin mining companies with a stake in the outcome of the conservation easement cases pending before the Court. We find that the letter from petitioner's counsel to counsel for Imerys is protected under the work product doctrine.
We further find that the letter is opinion work product. Non-opinion work product is discoverable if the party seeking discovery shows a substantial need for the work product and that it would be an undue hardship for the party to obtain the information some other way. Opinion work product, however, requires more than just a showing of substantial need/undue hardship-the party seeking discovery must also show that mental impressions are at issue in the case. See Ratke v. Commissioner, 129 T.C. 45, 53 (2007) citing Upjohn Co. v. United States, 449 U.S. 383, 401-02, 101 S.Ct. 677, 688-89, 66 L.Ed.2d 584 (1981). Although the letter contained factual information, the purpose of the letter was to verify that information and to detail how petitioner's counsel planned to use that information to advance petitioner's claims. Accordingly, in addition to showing substantial need and undue hardship, to have the letter admitted respondent must show that mental impressions are at issue in this case.
Respondent argues that he does have a compelling need for the letter, which is to use the letter in his examination of the witness from Imerys regarding kaolin pricing and costs in Georgia to determine the highest and best use of the property underlying the conservation easement deduction, and to potentially raise the issue of petitioner's expert's credibility. Nevertheless, respondent has not alleged that any of the information in the document is otherwise unavailable to respondent or that it would be an undue hardship for respondent to obtain the information some other way. Nor has respondent alleged or shown that petitioner's counsel's, or anyone else's, state of mind is at issue in this case. Therefore, we find that the work product doctrine protects the letter from disclosure.
Upon due consideration, it is
ORDERED that the letter to counsel for Imerys, dated February 3, 2023, is protected from disclosure by the work product doctrine. It is further
ORDERED that pursuant to Rule 70(d)(2), respondent must return the letter, and any copies he has, to counsel for petitioner upon receipt of this Order, must not use or disclose the letter in any way, and if respondent disclosed the letter to any party prior to notification of petitioner's claim of protection, must take reasonable steps to retrieve the letter.