Opinion
24703-21
09-19-2024
NORTH DONALD LA PROPERTY, LLC NORTH DONALD LA INVESTORS, LLC, TAX MATTERS PARTNER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Albert G. Lauber Judge
Trial of this case began on September 9, 2024, in New Orleans, Louisiana. A second session is scheduled to begin in New Orleans on October 7, 2024. The case involves a charitable contribution deduction claimed by North Donald LA Property, LLC, for a conservation easement.
On July 12, 2024, petitioner lodged the expert witness report of John H. Brooks III and Cornelius J. Williams. Over the weekend following the fifth day of trial, on September 15, 2024, petitioner filed at docket entries ##405 and 407 Motions for Leave to File the First Amended Report of Messrs. Brooks and Williams and concurrently lodged their amended report. According to the Motions, the proposed amended report revises the market price for minerals using information that the authors recently obtained, revises other types of factual information, and adds supporting documentation and references. During trial on September 16, 2024, respondent's counsel objected to the Motions, contending that the amended report is in substance a new expert report.
Petitioner lodged the proposed amended report twice, at docket entries ## 406 and 408, on the theory that each expert authored different parts of the single report.
We agree and will accordingly deny the Motions. The proposed amended report is the result of substantial revisions to the report lodged on July 12. It contains numerous new or heavily modified paragraphs that analyze market conditions and discuss the pricing of clay. Sections 1 through 14 of the report, which set forth the text of the authors' opinions, have been expanded from 27 pages in the original version to 30 pages in the amended version. The amended version estimates the value of the clay reserve on the property to be $93.21 million, a $30 million increase over the previous estimate of $63.27 million.
The Pretrial Scheduling Order in this case required opening expert witness reports to be lodged no later than 60 days before the scheduled start of trial, i.e., by July 12, 2024. The reason for requiring that reports be lodged in advance is to enable the opposing party and his experts to evaluate the reports, consider the possible need for rebuttal reports, and prepare cross-examination. The proposed amended report contains a substantial amount of new information that was not made available to respondent in a timely fashion. It would thus prejudice respondent if the amended report petitioner now offers were received into evidence at this late date.
Upon due consideration, it is
ORDERED that petitioner's Motions for Leave to File Amended Report, filed September 15, 2024, at docket entries ##405 and 407, are denied. The proposed amended report of Messrs. Brooks and Williams will not be received into evidence.