USCA1 Opinion

September 27, 1995

UNITED STATES COURT OF APPEALS
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
FOR THE FIRST CIRCUIT

_________________________

No. 95-1277

UNITED STATES OF AMERICA,

Petitioner, Appellant,

v.

NANCY GERTNER, ETC., ET AL.,

Respondents, Appellees.

_________________________

JOHN DOE,
Intervenor, Appellee.

_________________________

ERRATA SHEET
ERRATA SHEET

The opinion of this

court issued on September 13,

corrected as follows:

On page 18, note 7, line 3

change "he" to "the"

1995, is

UNITED STATES COURT OF APPEALS

UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
FOR THE FIRST CIRCUIT
_________________________

No.

95-1277

UNITED STATES OF AMERICA,

Petitioner, Appellant,

v.

NANCY GERTNER, ETC., ET AL.,

Respondents, Appellees.
____________________

JOHN DOE,
Intervenor, Appellee.
____________________

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Morton A. Brody,* U. S. District Judge]

____________________
____________________

Before

Selya and Boudin, Circuit Judges,

______________

and Lisi,** District Judge.

______________
____________________

John A. Dudeck, Jr., Attorney, Tax Division, U.S.

____________________
Justice,

with

whom

Loretta C. Argrett,
____________________

Assistant

Dep't of

Attorney

General, Gary R. Allen and Charles E. Brookhart, Attorneys, Tax

______________
_____________________
Division, were on brief, for appellant.
Gerald B. Lefcourt,
__________________
Dratel, P.C.,
____________

with whom Sheryl E. Reich, Lefcourt &

________________ ___________

Bruce Maffeo, Bernstein & Maffeo, Thomas E. Dwyer,

____________ __________________ ________________

Jr., Jody L. Newman, and Dwyer & Collora were on joint brief, for
___ ______________
_______________
appellees.
Judith H. Mizner,
_________________
Francis S. Moran, Jr.
_____________________

Andrew Good,
___________

Benjamin Fierro, III, and

_____________________

on joint brief for Massachusetts

Ass'n of

Criminal Defense Lawyers, Massachusetts Bar Ass'n, and Boston Bar

Ass'n, amici curiae.
____________________

September 13, 1995

____________________

____________________
*Of the District of Maine, sitting by designation.
**Of the District of Rhode Island, sitting by designation.

SELYA,
SELYA,

old-fashioned

Circuit Judge.
Circuit Judge.
_____________

tug of

war.

Internal Revenue Service

reasons,

Pulling

consortium consisting

controversy features

in

one direction

(IRS) which, for easily

is intent on learning

large legal fees in cash.

This

the identity of

is

an

the

understandable

persons who pay

Pulling in the opposite direction is a

of two lawyers and

three bar associations

(appearing

reasons

as amici

(fearing

curiae) which,

inter
_____

alia
____

for

equally understandable

that

disclosure

prosecution), is

intent on safeguarding the

who pay in cash.

In

and a stalemate

may

identity of clients

this case, the parties' positions

developed.

The district

spur

hardened

court resolved matters

in the lawyers' favor, refusing to enforce IRS summonses designed

to obtain "client identity" information pursuant to section 6050I

of the Internal Revenue Code (I.R.C.), 26 U.S.C.

Supp. V

1993).

(D. Mass. 1995).

more

I.
I.

See United States v. Gertner, 873

___ ______________
_______

The government appeals.

circumscribed grounds

court).

BACKGROUND
BACKGROUND

6050I (1988 &

than those

We

F. Supp. 729

affirm (albeit on

enumerated by

the lower

Federal

implementing

than

address,

specifically

regulations, requires

$10,000

transaction

law,

in

cash

during

to file a form

occupation, and

See I.R.C.
___

who

single

trade

social security

and

its

receives more

or

business

reporting the name,

number of

the payor,

transaction and the amount

6050I; 26 C.F.R.

6050I

a person

(IRS Form 8300)

along with the date and nature of the

involved.

I.R.C.

1.6050I-1(e) (1995).

At

Jody

various times in 1991 and 1992, respondents Nancy Gertner and

Newman, then

reflecting four

firm by

complete

partners in

successive payments of

a single

client.

except for

advised the

a Boston

Each

the name

law firm,

hefty cash

of the

of the

filed forms

fees to

forms was

client.

the

essentially

The respondents

IRS that they were withholding the client's identity

on the basis of

ethical obligations, attorney-client

privilege,

and specified constitutional protections.

These

correspondence

filings

between

exchange,

members

occasions

to

of

determine

sparked

the

the

law firm

lengthy

and

firm attempted

whether

the

IRS

the

on

course

IRS.

at

wanted

In

least

the

of

that

three

omitted

information as part of an investigation focused on the firm or to

learn more

about the unnamed client.

The IRS did

not deign to

answer these inquiries.

The

parties remained

deadlocked

and

the IRS

issued

summonses purporting to direct the respondents to furnish certain

records

and

testimony

respondents declined

enforcement

action

anent

to comply.

pursuant to

claiming that

it wanted the

investigation

of the

the

client's

The government

I.R.C.

information in

law firm's

identity.

then brought an

7402(a) &

7604(a),

connection with

tax liability.

The

On

an

April 20,

1994, after perusing the complaint and the declaration of Revenue

Agent Sophia

Ameno, the district court issued an order directing

the respondents to show cause why they should not be compelled to

honor the summonses.

The

pseudonymously.

court

the

defense.

its real objective

to

intervene

the intervenor

First, they asseverated

alleged investigation of the

disguising

client

Thereafter, the respondents and

mounted two lines of

IRS's

permitted

that the

lawyers was merely a pretext

learning more about the client

and that

the

the government therefore

statutory

procedure

for

unidentified third parties.1

should be required

issuing

See I.R.C.
___

to follow

summonses

affecting

7609(f).

Second, in

concert with the amici they

insisted that various privileges and

protections allow lawyers to

shield their client's identity from

the reach of

that

it

such summonses.

had

respondents

employed

had

investigation

motive

tainted

failed

of the law

the

to

The IRS

joined issue,

appropriate

procedure;

show

either

that

firm was

a sham

or that

the summonses;

and,

asserting

finally,

that

the

the

supposed

an improper

that no

special

protection of any kind attached to the desired information.

When the day of

the

district

court to

opposed the request.

decision dawned, the respondents asked

take

live

testimony.

The

government

The court eschewed the evidentiary

hearing

that the

respondents sought but nevertheless

refused to enforce

____________________

1Such
summons.

summons is

known

colloquially

The IRS cannot issue

statute as a

summons "which

as

a "John

a John Doe summons

does not identify

securing

court

approval.

I.R.C.

requiring such approval is obvious:

court in effect "takes
being unnamed, cannot
alone to oppose

7609(f).

The

reason for

in the John Doe context, the

expected to know

the summons even if it

taxpayer" who,
about

is irregular.

let

Tiffany
_______

Fine Arts, Inc. v. United States, 469 U.S. 310, 321 (1985).
_______________
______________
discuss the mechanics of the preapproval process infra.
_____

with

without first

the place of the affected

herself be

defined by

the person

respect to whose liability the summons is issued"

Doe"

We

the summonses.

It found as a fact that the IRS's purported probe

of the law firm's

tax-related affairs was a

IRS should have complied

the summonses.

court

stop

there;

circumstances

thwarted

identity.

II.
II.

See
___

here

the IRS's

with I.R.C.

7609(f) prior

Gertner, 873 F. Supp.

_______

it

proceeded

obtaining,

demand

See id. at 734-37.

___ ___

to

the

for

hoax, and that

at 734.

hold

to serving

Nor

that,

attorney-client

information

the

did the

under

the

privilege

concerning

client

This appeal ensued.

ANALYSIS
ANALYSIS

We split

our analysis into three segments.

First, we

limn

the

framework

judiciary's imprimatur

Next, we mull the

under

whether

should be impressed upon

the

of review that

federal

an IRS summons.

district court's finding on the

pretext issue

pertains in this

Lastly, we explain why the IRS's failure to comply with

7609(f) effectively ended the case.

A.
A.

The IRS

I.R.C.

determining

the deferential standard

context.

I.R.C.

for

7602 &

be summary, see
___

The Framework.
The Framework.
_____________

has broad

7604.

summonses under

Enforcement proceedings are

Donaldson v.
_________

(1971); United States v.

_____________

authority to issue

United States, 400

_____________

designed to

U.S. 517,

Freedom Church, 613 F.2d 316,

______________

529

321 (1st

Cir. 1979), and the court's role is simply to ensure that the IRS

is using its broad authority in good faith and in compliance with

the law.

658

See Donaldson, 400 U.S. at 536;

___ _________

F.2d 526, 535

(1982).

(7th Cir. 1981), cert.

_____

Thus, when a

United States v. Kis,

_____________
___

denied, 455 U.S. 1018

______

challenge to a summons is lodged,

the IRS

must only satisfy the

conducted

pursuant

court that (1) its investigation

to a

proper

purpose,

(2) the

is being

information

sought

in the summons

is (or may be)

(3)

the information is not

and

(4)

all legally

followed.

(1964);

See
___

Copp v.
____

relevant to that purpose,

already within the IRS's possession,

required

administrative

United States v.
______________

United States,
_____________

Powell,
______

968 F.2d

steps have

379 U.S.

48,

1435, 1437

been

57-58

(1st Cir.

1992), cert. denied, 113 S. Ct. 1257 (1993).

_____ ______

In determining

whether to enforce IRS

summonses under

these

substantive standards, we do not write on a pristine page.

This

court

has

constructed

expediting such determinations.

321; United States v.

_____________

accord
______

three-tiered

framework

See Freedom Church, 613

___ ______________

for

F.2d at

Salter, 432 F.2d 697, 700 (1st Cir. 1970);

______

United States v. Church of Scientology, 520 F.2d 818, 824

_____________
_____________________

(9th

Cir. 1975); United States v. McCarthy, 514 F.2d 368, 372-73

_____________
________

(3d Cir. 1975).

prima

To mount

facie showing that

lawful purpose.

the first tier,

it is acting

This burden is

repeatedly have confirmed that

agent attesting

itself

the IRS must make

in good faith

and for a

not taxing, so to speak.

Courts

an affidavit of the investigating

to satisfaction of

the four Powell

______

elements is

adequate to make the requisite prima facie showing.

See,
___

e.g., Sylvestre v. United States, 978 F.2d 25, 26 (1st Cir. 1992)
____ _________
_____________

(per curiam), cert. denied, 113 S. Ct. 1606 (1993); United States
_____ ______
_____________

v. Lawn Builders of New Eng., Inc., 856 F.2d

________________________________

1988);

388, 392 (1st Cir.

Liberty Fin. Servs. v. United States, 778 F.2d 1390, 1392

___________________
_____________

(9th Cir. 1985); Kis, 658 F.2d at 536.

___

Once this

to the taxpayer

in consequence

taxpayer

is

minimal showing surfaces, the

to rebut the good-faith

of

the

not

at

government's profession

government's

this

of

stage

presumption that arises

prima facie

required

good faith.

burden shifts

See
___

to

case.2

The

disprove
________

the

United States
_____________

v.

Samuels, Kramer & Co., 712 F.2d 1342, 1348 (9th

_____________________

658

F.2d

at 540.

She

burden of production:

the taxpayer

must,

however, shoulder

in order to advance past

must articulate

support of those allegations.3

that

F.2d at

See Kis,
___ ___

700.

that she

bad faith

658 F.2d at 540; United

______

607 F.2d

This

the taxpayer conclusively give

case, but only

the first tier,

particularized evidence in

v. Garden State Nat'l Bank,

_________________________

1979); Salter, 432

______

a significant

specific allegations of

and, if necessary, produce reasonably

States
______

Cir. 1983); Kis,

___

61, 71

showing does not

the lie to

create a "substantial

(3d Cir.

demand

the prima facie

question in

the

court's mind regarding the validity of the government's purpose."

Salter, 432 F.2d at

______

700; accord Church of Scientology,

______ _____________________

520 F.2d

____________________

2The
"proof

summons enforcement

structure" for

Title VII.

framework

is reminiscent

proving intentional

discrimination under

See Texas Dep't of Community Affairs v.

___ ________________________________

U.S. 248, 252-55

of the

Burdine, 450
_______

(1981); McDonnell Douglas Corp. v. Green,

________________________
_____

411

U.S. 792, 802-05 (1973).

3Although

some cases

proof" at this stage,

refer

at 700,

description

taxpayer's "burden

see, e.g., United States v.

___ ____ _____________

Mgmt., Inc., 769 F.2d 1440,

____________
F.2d

to the

1444 (10th Cir.

those cases are

Balanced Fin.
_____________

1985); Salter, 432

______

not necessarily at

of the framework's second tier.

of

odds with our

The term "burden of

proof" may

refer to either a burden or production or a burden of

persuasion.

See Kenneth S. Broun et al., McCormick on Evidence

___
_____________________

336 (4th

ed. 1992).

Only

the burden of production

is at issue

when the taxpayer attempts to rebut the IRS's prima facie showing
and thereby justify further inquiry.

at 824; McCarthy, 514 F.2d at 376.

________

absolutely

essential

independent

new

that

To reach this goal, it is not

the taxpayer

evidence; she may hoist her

facts or

by

bringing to

light

adduce

additional

or

burden either by citing

mortal weaknesses

in

the

government's proffer.

If

the taxpayer

the third tier beckons.

the facts,

the

satisfies this burden

At this stage, the district court weighs

draws inferences, and decides

court frequently

of production,

will

proceed to

the issue.

an evidentiary

To

do so,

hearing,

taking testimony

Kramer, 712
______

is no

and exhibits

from

both sides.

See
___

F.2d at 1347-48; Salter, 432 F.2d at 700.

______

hard-and-fast rule compelling

district court

may, in

Samuels,
________

But there

an evidentiary hearing.

appropriate circumstances, forgo

hearing and decide the issues on the existing

record.

such a

See Copp,
___ ____

968 F.2d at 1438 n.1; McCarthy, 514 F.2d at 373.

________

continuing

IRS.

question

lingers

at

the

third

tier

as

to

the

viability of the original presumption in favor of the

The case law seems to suggest that the presumption endures

and serves at

this stage to saddle the taxpayer

with the burden

of persuading the judge, qua factfinder, that at least one of the

___

Powell
______

elements is

missing.

See, e.g.,
___ ____

Kis, 658 F.2d

___

at 540

(stating

that a

taxpayer

"can succeed

only

by showing

by

preponderance of the evidence some improper use of the summons by

the

IRS"); Freedom Church,

_______________

613 F.2d

at

319 ("The

proving an abuse of the court's process or the absence

burden

of

of one of

the Powell elements of good faith is on the summonee."); see also

______
___ ____

United States v. Balanced Fin. Mgmt., Inc., 769 F.2d

_____________
__________________________

1440, 1445

(10th

Cir. 1985).

especially

given

We

are somewhat skeptical

the

Supreme

presumptions and burdens of

St. Mary's Honor Ctr.

______________________

(holding

that a Title VII

facie case).

Hicks is
_____

recent

113 S.

Ct. 2742,

plaintiff always bears

presumption in her

The

Court's

consistent with

lesson

proof in an analogous setting.

v. Hicks,
_____

persuasion despite the

prima

Court's

of this approach,

the basic

2747 (1993)

the burden of

all

civil

actions

principle, codified

and

otherwise provided for by

proceedings not

Act of Congress or

by these rules, a presumption imposes on

party against whom it
of

going forward

meet the presumption,

the

is directed the burden

with evidence to

her

presumptions in

Federal Rules of Evidence:

In

See
___

favor created by

treatment of

on

rebut or

but does not shift

to

in the

such party

the burden of proof

of the risk

in the sense

of nonpersuasion, which

throughout the

remains

trial upon the party

on whom

it was originally cast.

Fed. R. Evid. 301.

We

are hard-pressed

to

proceedings should diverge from

not

the

taxpayer, that

court; and, in a

the

requested

I.R.C.

relief

public

only

in

addressed by

IRS

this principle.

seeks to

invoke

enforcement

It is

the IRS,

the processes

of the

instructed to grant

when "sufficient

proof

is

made."

Though it certainly can be argued that "strong

policy"

Salter, 432 F.2d at 700, it

______

interest

why

related vein, the court is

7604(b).

reasons of

fathom

obtaining

justify

burden-shifting

scheme,

would seem that the IRS's legitimate

summary

enforcement

the particularized burden of

is

satisfactorily

production imposed on

10

the

taxpayer, without going the

States
______

addition
________

v.

Euge,
____

444 U.S.

707,

whole hog.4

719

(1980)

See, e.g., United

___ ____ ______

(stating that

in
__

to the taxpayer's right to challenge a summons, the IRS

__

"must also establish [its]

compliance with the [four recognized]

good faith requirements"); McCarthy,

________

that "the Secretary should

514 F.2d at 373 (suggesting

be prepared to prove the

allegations

of

the

complaint

that the

summons

complies

with the

Powell
______

requirements").

While

this

point

is intellectually

interesting,

defer a definitive decision on it to a different day.

we

After all,

____________________

4The
burden

cases suggesting

of persuasion

rely

extracted from Powell

______
437

U.S. 298

Powell
______

that the

taxpayer has

principally

on isolated

and United States

_____________

(1978).

Foremost among

these statements

this slender

on

the

IRS to

"show

379 U.S. at 58.

reed can bear

subsequent opinions have placed on it.

that

relevant to the purpose,

within

the

administrative steps

required by

that

Powell itself imposed the

______
the

investigation will

that the information

Commissioner's

We are

the strain

conducted pursuant to a legitimate purpose, that the

already

is the

Court's comment that "[t]he burden of showing an abuse of

not confident that

be

statements

v. LaSalle Nat'l Bank,

___________________

the court's process is on the taxpayer."

burden

the ultimate

possession,

the Code have

be

inquiry may

sought is not
and

that

the

been followed."

Id. at 57-58.
___
abuse

The

of process,

affirmative

Court's subsequent reference

read

in context,

defenses, e.g.,

allegations

conduct of an investigation.
By
"those
disprove
or

like

token,

seems

to proving

an

confined

to

to be

of

harassment in

See id. at 58.

___ ___
the

LaSalle Court's
_______

opposing enforcement of a

statement

summons do bear

that

the burden to

the actual existence of a valid civil tax determination

collection purpose

by the

Service," 437

U.S. at

316, does

little to prop up the government's burden-of-proof argument.

LaSalle
_______

Court

prosecution

held

even

this fact

if

the

would not

IRS

had

The

criminal

constitute a

per se

for a civil summons, because civil and criminal

investigations

easily.

that,

in mind,

improper purpose
tax

the

are

typically too

See id. at 314-16.

___ ___

Hence,

intertwined

to untangle

the quoted statement applies

only in situations where the taxpayer is seeking to avail herself

of

the "sole criminal purpose" defense to a summons.

Copp, 968 F.2d at 1437.

____

11

See, e.g.,
___ ____

the respondents concede that

them

to

evidence,

objection.

lower

prove

improper

and they

the district court tacitly required

purpose

accepted

by

the burden

Consequently, we proceed

court's resolution of the

record suffices

for a finding

preponderance

of

of

the

proof without

any

on the assumption that the

issue will prevail

only if the

that the respondents

carried the

devoir of persuasion.

B.
B.

With this

The Finding of Improper Purpose.

The Finding of Improper Purpose.
_______________________________

structure in mind,

we turn to

the district

court's determination

the summonses

law firm

that the IRS's stated

purpose for issuing

its avowed desire to investigate the respondents'

was merely a pretext to enable it

to learn more about

the intervenor.

At the

remarkably

outset,

thin prima

declaration provides

favor of

the

requisite bases

a shallow

the

established by

foundation for a

While

the declaration

contains the bareboned

for the government's prima

of specifics.

constrained to

facie case

government.

it

we are

facie showing

note that

the

Agent Ameno's

presumption in

touches

the

allegations needed

it is

utterly devoid

Though a conclusory affidavit is enough to satisfy

government's burden at the first tier of the framework, see,

___

e.g., Sylvestre, 978 F.2d at 26; Lawn Builders, 856 F.2d at 392,
____ _________
______________

it

can

come back

supplemented by

to haunt

the proponent

if

it is

not later

more hearty fare once the challenger succeeds in

scaling the second tier.

At any rate, the government effectuated its prima facie

12

showing with little room

the

respondents

to

to spare.

produce

The burden then shifted

evidence

and/or

allegations

to

of

sufficient

force and exactitude to warrant

meet

burden, the

this

should be

respondents

shelved because

argued

further inquiry.

that the

To

summonses

the government's professed

purpose

linking the summonses to an investigation into the law firm's tax

liability

was pretextual.

Contrary to the government's dismissive suggestion, the

respondents did

they submitted

extensive

not simply level the charge.

two affidavits.

One affidavit

correspondence between

second affidavit

the

chronicled the firm's

income reporting requirements, and

had

the data it

complied

with its

respondents documented

incorporated the

firm and

the

IRS.

meticulous attention

The

to

asserted that the IRS already

needed to determine whether

tax-related

In support of it,

obligations.

several public

the firm had fully

In addition,

statements which

the

seem to

imply

for

that the IRS's

lawyers' compliance

address money

criminal

the

tax

laws, and

narcotics distribution,

activity on the part of lawyers' clients.

________________________________

in part to

use large

activities");

data

laundering,

with

more

and

to

kindred

See, e.g.,
___ ____

Publication 1544 (rev. Aug. 1994) (stating that Form 8300 is

intended

[who]

summonses to attorneys

the records of large cash-paying clients is designed less to

monitor

IRS

purpose in issuing

[obtained

help identify

cash payments

IRS News

through

"smugglers and

drug dealers

to `launder' money

from illegal

Release IR-93-113

Form

8300]

13

helps

(Dec. 7,

1993) ("The

detect

nonfiling,

unreported

income, and

money laundering

narcotic trafficking and other illegal

customers

and clients

of

with

activities by some of the

the businesses

Finally, the respondents pointed

often associated

required to

file.").

out that the Ameno declaration,

which purported to describe the ongoing investigation

of the law

firm, was nothing but boilerplate.5

The lower

that

court concluded

on this chiaroscuro

record

the government's supposed investigation of the law firm was

pretext for

an anticipated

investigation of

John Doe.

See
___

Gertner,
_______

horses

court

873 F.

Supp. at

into the breach.

erred

evidentiary

in

734.

the

summonses

1.
1.

government's

whether

rides two

that the district

without

holding

an

Second, it posits that, in all events, the

court's ultimate finding of pretext,

it, is unsupportable.

the IRS

First, it maintains

stabling

hearing.

On appeal,

based on the record

before

Both steeds are lame.

The Need for an

Evidentiary Hearing.
The Need for an
Evidentiary Hearing.
_________________________________________

first question

is easily

answered.

The

The decision

to hold an evidentiary hearing in a given case generally

rests within the sound discretion of the trial court.

See, e.g.,
___ ____

Weinberger v. Great N. Nekoosa Corp., 925 F.2d 518, 527 (1st Cir.
__________
______________________

1991); United States

_____________

v. Panitz,
______

907 F.2d 1267,

1273 (1st

Cir.

1990); United States

_____________

v. DeCologero,
__________

821 F.2d 39,

44 (1st

Cir.

word,

the

15 F.3d

592

____________________

5The

declaration

declaration at issue
(6th

matched,

conceded

affidavit"

that the

word

for

in United States v. Ritchie,

______________
_______

Cir.), cert. denied,

_____ ______

government

almost

at

115 S.
oral

Ct. 188
argument,

IRS routinely

uses in

proceedings spurred by Form 8300 filings.

14

(1994), and,
was

"the

as the

standard

summons enforcement

1987).

the

This discretion remains fully intact when the business of

day is the

enforcement of an

IRS summons.

See Fortney v.
___ _______

United States, 59 F.3d 117, 121 (9th Cir. 1995) ("We defer to the
_____________

district court's

discretion to decide if

on the

question

of enforcement

Hintze
______

v.

IRS, 879
___

Appellate review

with

is, therefore,

district

withhold

proceeding

an

F.2d 121,

court's

evidentiary

only if

of a

126

summons is

(4th Cir.

warranted.");

1989) (similar).

deferential; we will

bottom-line decision

hearing

in

to

summons

the appellant demonstrates

trial court's substantial discretion.

n.1.

an evidentiary hearing

interfere

conduct

or

enforcement

an abuse

of the

See Copp, 968 F.2d at 1438

___ ____

We

discern no

abuse in

during the proceedings below did

hearing.

Rather, it

Agent

chose to

Ameno's

vigorously (and successfully)

opposed the

such a

roll

conclusory

point.

hearing.

the dice,

such a

In

other words,

apparently confident

declaration

would

withstand

the

that

the

Having gambled and lost,

perilously poor position

to pursue

the

In any event, "[w]e regularly turn a deaf ear to protests

that an

not,

in a

no time

evidentiary

respondents' allegations and evidence.

the government is

At

the IRS request an

respondents' request for

government

this situation.

evidentiary hearing

where, as here,

should have

the protestor

hearing in the lower

court."

been convened but

did not

Aoude v.
_____

was

seasonably request

Mobil Oil Corp.,

_______________

892 F.2d 1115, 1120 (1st Cir. 1989); see also Sylvestre, 978 F.2d
___ ____ _________

at 28 n.3

(explaining that

a taxpayer's failure

to request

an

15

evidentiary hearing in the district court precluded consideration

of his later claim

that such a hearing

should have been

held);

see generally CMM Cable Rep., Inc. v. Ocean Coast Props., Inc.,
___ _________ _____________________
_________________________

48 F.3d

the

618, 622 (1st Cir.

1995) ("A party who

neglects to ask

trial court for relief that it might reasonably have thought

would

be available

is not

entitled to

importune the

court of

appeals to grant that relief.").

2.
2.

remaining

The Supportability of the Crucial Finding.

The Supportability of the Crucial Finding.
___________________________________________

question is

whether the

pretextual purpose is supportable.

in

conducting an

investigation

explorations, a predominantly

that, absent

disturb the

erroneous.

Cir.), cert.
_____

mistake of

district court's

finding of

Determining the IRS's purpose

is, like

most

motive-oriented

factbound enterprise.

law,

The

an appellate

It follows

tribunal

should

district court's determination only if it is clearly

See
___

United States v. Ritchie, 15 F.3d

_____________
_______

denied, 115 S.
______

Ct. 188 (1994);

592, 599 (6th

Copp, 968
____

F.2d at

1437;

Hintze, 879 F.2d at

______

1426; Ponsford v.
________

F.2d 1305, 1307-08 (9th Cir. 1985).

if

there

are

two

or more

United States, 771

_____________

This means, of course, that

plausible

interpretations

of

the

evidence, the district court's choice among them must

hold sway.

See Johnson v. Watts Regulator Co., ___ F.3d ___, ___

___ _______
____________________

(1st Cir.

1995) [No. 95-1002, slip op. at 22].

Here, no

clear error looms.

enforcing the summonses depended

The government's case for

entirely on Agent Ameno's self-

serving declaration (which, as we have previously indicated, is a

16

web

of

unsubstantiated

conclusions).

In

respondents fashioned a sufficient evidentiary

support

client.

was to

The law

gain

information about

firm's affidavit, if

IRS had no apparent reason

impropriety.

affidavit,

never

the

infrastructure to

an inference that the IRS's sole purpose in pursuing the

summonses

the

contrast,

And,

moreover,

devoid of

really suspected

The IRS's stonewalling

the lawyers'

credited, indicates that

to suspect it of any tax-related

the

IRS's

use

particularization, suggests

the firm

unnamed

of any

its unexplained

of

generic

that the

IRS

questionable activity.

refusal to answer

the

firm's

repeated inquiries

as to

whether it

investigation

points in the same direction.

in

the

light

of

information

IRS's

gleaned

from

attorneys'

unidentified

conclude, therefore,

may

have accompanied

below reasonably

evidence

favored

of

filings

who pay counsel fees in

client

seem

the IRS's prima

quite

plausible.

as

cash,

We

presumption which

facie showing,

found that

using

the IRS's interest lay

that notwithstanding any

could have

the

practice

Form 8300

make the district court's conclusion that

the

fact under

These facts, taken

self-proclaimed

vehicle for investigating clients

only in
____

was in

the court

a preponderance

respondents'

claim

of

pretext.6

argues

this

finding

of the

See
___

____________________

6The

government

that

is

flatly

inconsistent with the district court's original acceptance of the

Ameno declaration as a sufficient basis for issuing a

show-cause

order.

We do not agree.

The acceptance of the IRS's first-tier

proffer signifies nothing more

that

acknowledgement

the IRS has mustered a prima facie showing for enforcement.

Once the
and

than the court's

respondents met their second-tier

raised

a legitimate

question

about

burden of production
the

validity of

the

summonses, however, the court was free to reevaluate the original

17

Ritchie,
_______

contradict

15

F.3d

at

this view

court's] finding,

599

("Although

and the

there

IRS strenuously

[the] findings are not

was

evidence

objects to

to

[the

clearly erroneous, and

we therefore adopt them.").

The

States v.
______

aff'd,
_____

government

that

the

decision

Tiffany Fine Arts, Inc., 718 F.2d

________________________

7 (2d

in United
______

Cir. 1983),

469 U.S. 310 (1985), should propel us toward the opposite

conclusion.

There, the

for the dual purpose of

and

argues

a John

Doe, see 718

___

Second Circuit upheld

a summons issued

investigating both a designated taxpayer

F.2d at

affirmed, see 469 U.S. at 324.

___

this case into the Tiffany last.

_______

13-14, and

the Supreme Court

The government tries to shoehorn

The fit, however, is imperfect.

In Tiffany, unlike here, the district court ascertained

_______

as a matter of fact

that the IRS had a dual purpose, that is, an

actual interest in the investigation of both the taxpayer and the

____

John Doe.

See
___

of fact).

In this case, the district court

___

469 at 317 (recounting district

court's findings

ascertained, also as

a matter of fact, that the IRS did not have an actual interest in
___

the investigation

but only
____

of the

taxpayer (the respondents'

in learning more about

are not fair

congeners except

Brody's supportable

John Doe.

to the extent

factual finding that the

Thus,

law firm),

the two cases

that, given

Judge

summonses at issue

here were not dual purpose summonses, the Supreme Court's opinion

in Tiffany clearly indicates that we should respect that finding.

_______

See
___

id. at 322.
___

And,

once the judge determined

as a matter of

____________________

proffer in light of the respondents' counter-proffer.

18

fact

that

the

government's

summonses was to further an

actual

purpose

in

issuing

the

investigation of the unnamed client,

the follow-on conclusion that the government should have complied

with

the

procedure

irresistible.7

We

for

issuing

John

Doe

summonses

becomes

See id.
___ ___

take

no

pleasure

in

upholding

finding

that

government actors

with statutorily

did not reach

examined,

constructed a pretext to

prescribed requirements.

But the

this conclusion lightly and

does not

give

court's judgment is wide

rise to

avoid due compliance

court below

the record, carefully

firm conviction

of the mark.

Accordingly,

that

the

the finding

of pretextual purpose must stand.

C.
C.

The Remainder of the District Court's Decision.

The Remainder of the District Court's Decision.
______________________________________________

Despite its

double-edged

ought to have complied

but did

not do

determination that

with the strictures of I.R.C.

so, the

district court

proceeded to

the

IRS

7609(f),

reach and

____________________

7At oral
contended

that

argument in
the

this court, the

summonses

effectuate compliance with the

6050I itself.

should

be

government belatedly
enforced

simply

to

reporting requirements of section

This nascent contention materialized

out of thin

air; prior

to oral

justify the

argument, the

summons solely as

government

a means of

had attempted

to

investigating whether

the law firm had reported all the income required to be reported.
Since the

record reveals beyond

government's
coherent
States
______

hope of contradiction

newly minted contention

fashion, we
v. Zannino,
_______

will not
895

entertain it

F.2d 1,

17

litigant's

obligation to

spell out

distinctly

in

court),

(1990);

the trial

Patterson-Leitch Co.
_____________________

Elec. Co.,
_________
connection,

was not made

below in any

here.

(1st Cir.)

See United
___ ______

(discussing

its arguments
cert. denied,
_____ ______

that the

squarely and
494

U.S. 1082

v. Massachusetts Mun. Wholesale

______________________________

840 F.2d 985, 990 (1st Cir. 1988) (similar).

we remind the

government that

are not adequate to preserve an

appellate venue."

In this

"[p]assing allusions

argument in either a trial or an

United States v. Slade, 980 F.2d

______________
_____

Cir. 1992).

19

27, 30 (1st

resolve

the other issues in the case.

why the

court chose to grapple

intended to

articulate an

summonses, or it

with I.R.C.

not resolve the

merely

to

thought the IRS's

It may have

rejecting the

failure to

be a specie of harmless error.

ambiguity.

memorialize a

additional holdings are

with these issues.

alternative ground for

may have

7609(f) to

It is not entirely clear

If the court

further

extended its

basis for

its

comply

We need

journey

decision, the

surplusage and can be disregarded.

See
___

Kastigar v. United States, 406 U.S. 441, 454-55 (1972) (rejecting

________
_____________

language

"unnecessary

to

the

Court's

decision"

as

binding

authority in subsequent cases).

ventured afield because it

On the

other hand, if the court

concluded that the government's bevue

was harmless, the court miscalculated.

We explain briefly.

Congress passed section 7609(f) specifically to protect

the

civil rights,

subjected to

See
___

including

the IRS's aggressive use

S. Rep. No. 938, 94th

in 1976 U.S.C.C.A.N. 3439,

__

2d Sess.

the privacy

that

a John

authorized

Doe summons

of third-party summonses.

3797; H.R. Rep. No. 658,

307 (1975), reprinted in 1976

_________ __

Section 7609(f)

taxpayers

Cong., 2d Sess. 368 (1976), reprinted

_________

see generally Tiffany, 469 U.S.

___ _________ _______

7609).

rights, of

U.S.C.C.A.N. 2897, 3203;

at 315-17 (discussing history of

accomplishes this

is not

94th Cong.,

valid unless

goal by

providing

and until

it is

by a judicial officer after a hearing (normally an ex

parte hearing, given the

nature of the problem).

In the

proceeding, the IRS must establish that:

(1)

the

investigation

summons
of

relates

particular

to

the

person

or

20

ascertainable group or class of persons,

(2)

there

is

a reasonable

believing that such person

of

persons may

comply

with any

fail or

basis

for

or group or class
may have

provision

of any

failed to
internal

court

revenue law, and

(3)

the

information

obtained from the

(and the

sought

to

be

examination of the records

identity of the

person or

persons

with respect to

whose liability the

summons

is

not readily

issued)

is

available

from

other sources.

I.R.C.

7609(f).

This

important

requirement

component

of the

of

judicial

statutory

preapproval

scheme;

is

it permits

an

the

district court to act as a surrogate for the unnamed taxpayer and

to

"exert[] a restraining influence

U.S. at 321.

the enforcement

the IRS cannot

Tiffany, 469
_______

The statutory protections cannot be cavalierly cast

aside by either the executive or

IRS does not

on the IRS."

the judicial branch.

proceeding results

in fact intend to

obtain the

Hence, if

in a determination

investigate a named

data it seeks

that the

party, then

without observing

the

mandate of section 7609(f).

So

the

IRS

liability

had

of

it is here.

no

See id. at 322.

___ ___

The court below supportably found that

intention

of

investigating

the respondents'

cannot obtain the

law

firm.

identity of the anonymous client

assuming

will

gauntlet.

To

hold

tax-related

Therefore,

by means of these summonses unless and until it

7609(f)

the

otherwise would

the IRS

John Doe

runs the section

be

tantamount to

either that section 7609(f) is nugatory or that the IRS

always

be able

assumptions have

to fulfill

no basis

in

the

law or

21

statute's demands.

in fact.

The John

Such

Doe

summons procedures

represent a basic legislative

the

taxpayers'

importance of

privacy and

other

judgment about

rights

and

courts must respect that judgment.

To

be

sure, the

harmless

error

argument derives

superficial measure of credibility from Ritchie, a

_______

the

Sixth Circuit held that,

IRS did

I.R.C.

court

not have

7609(f).

to go

See
___

despite a finding

back through the

Ritchie, 15
_______

thought that "it would

case in which

of pretext, the

protocol mandated

F.3d at 600.

exalt form over

The

by

Ritchie
_______

substance to make

the IRS go through the motions" required by section 7609(f), only

"to

bring us back

to where we are

now."

Id.
___

at 600.

Passing

over the court's somewhat casual view of the protections afforded

by the John Doe

possibility of

summons procedures,8 and without ruling

harmless

error in

under section 7609(f) form

this context,

out any

we think

is substance, and that the

__

that

procedure

mandated by Congress generally must be followed.

In

There, unlike

statutory

events,

here, an

protections

literally, and

persuade

all

Ritchie
_______

is

plainly distinguishable.

evidentiary hearing

had

the record

been

had been

afforded "in

contained

spirit"

held, the

if

sufficient information

not

to

the court that the IRS had met "the substantive factors

____________________

8Ritchie suggests
_______

that the "statutory

strong in any

event."

weakness

relative

are

totally devoid

15

F.3d at

concepts,

of muscle.
have a

unidentified

taxpayer may have

7609(f)(2),

showing the

IRS

must

not

But strength

and

600 n.8.
and section

"reasonable basis for

Powell
______

from
to

not

the requirement

violated internal

under

is

believing" that

differs significantly
make

7609(f)

Among other things,

that the IRS

I.R.C.

protections are

the

revenue laws,
the

obtain

minimal

judicial

enforcement of other kinds of summonses.

22

of

7609(f)."

Ritchie, 15 F.3d
_______

at 600.

We have no comparable

record before us, and

will pass the

statutory test.

requirements for

that it

a John

possesses

Ameno's

satisfy

Doe summons,

conclusory

the

John

imperatives

preapproval would

to comply with

In this

case,

Doe).

of

its

If

this were

section

7609(f),

become a charade,

that

the tax

we have

on

other

demonstrate

for believing

declaration, directed

(not at

among the

the IRS must

basis

have failed

7609(f)(2).

respondents

In particular,

a reasonable

unnamed taxpayer may

See I.R.C.
___

no basis to assume that the IRS ultimately

the

laws.

only

Agent

face at

the

sufficient

to

then

and section 7609(f)

judicial

a dead

letter.9

We need

go

no

further.

Any way

we

look

at

the

situation, the district court's views as to the applicability vel

___

non
___

of the

result.

attorney-client privilege

Consequently,

we have

no

are not necessary

occasion

to the

to consider

the

correctness of the court's conclusions on those issues.

III.
III.

CONCLUSION
CONCLUSION

The district

not drawn

court's finding that

in connection

related liability,

with

a probe

the summonses

of the

but, instead, for the

law firm's

were

tax-

clandestine purpose of

____________________

9We note, too, that the

IRS

that

it

was issuing

Sixth Circuit explicitly warned the

a

"one-time only"

free

Ritchie, 15 F.3d at 600 ("We are not suggesting that

_______
in

the future

required by

avoid

going

through

the

7609(f).").

parte

See
___

the IRS may

proceeding

7609(f), for now the IRS has fair notice that if it

cannot demonstrate a bona fide interest

liability

ex

pass.

of

the

party

summoned,

The government cannot

in investigating the tax

it

must

comply

legitimately expect

with

another

free pass this time around.

23

investigating

the

supportable.

This means that the government is legally bound to

follow

the prescribed

summonses.

enforcement

alone.

lawyers'

See I.R.C.
___

unnamed

procedure

7609(f).

should be denied

client,

for the

John

service

It has not done

for that

reason, and

Doe,

of John

so.

is

Doe

Summons

that reason

We are mindful that restricting our disposition to this

narrow ground leaves larger

issues unresolved, see, e.g., United

___ ____ ______

States v. Sindel, 53 F.3d 874, 877-78 (8th Cir. 1995) (discussing

______
______

ethical

implications

privilege in

and

applicability

of

attorney-client

6050I summons enforcement proceeding brought after

attorney withheld client's identity); United States v. Leventhal,

_____________
_________

961 F.2d 936, 940-41 (11th Cir. 1992) (similar); United States v.
_____________

Goldberger & Dubin, P.C., 935

_________________________

(similar), and that these

But

should concentrate

(2d Cir.

1991)

issues are freighted with consequence.

courts must resist the

stalk before their time.

F.2d 501, 503-06

temptation to pluck

issues from the

The judicial task, properly understood,

on those

questions that

must be

decided in

order to resolve

a specific case.

unsettled issues of broad

v.

Peoples Bank,
____________

Ashwander
_________

v. TVA,
___

concurring).

the art of

333

This is

especially true when

public concern are afoot.

U.S. 426,

297 U.S.

432 (1948)

288, 345-48

See Eccles
___ ______

(Frankfurter, J.);

(1936)

(Brandeis, J.,

In this sense, the science of horticulture is like

judging:

yearning for the blossom

when only the bud

is ready enhances the growth of neither the flower nor the law.

24

Affirmed.
Affirmed.
________

25