Court of Federal Claims Orders Unsealing of Documents in Partnership Tax Case

We have had occasion to rule on a number of procedural and substantive issues. See Russian Recovery Fund Ltd. v. United States, 81 Fed. Cl. 793 (2008) (holding it improper for 2000 FPAA to adjust an individual partner's amount at risk in its distributive share of non-recourse partnership liabilities); 90 Fed. Cl. 698 (2009) (satisfying jurisdictional deposit requirement of section 6226(e) requires inclusion of all potential increased tax liability for tax years affected by the FPAA). In our most recent opinion we held that the 2000 FPAA suspended the statute of limitations for adjustment of Nancy Zimmerman's 2001 individual tax return, or for any partners she represents, while an extension agreement failed to apply to James DiBiase's return, which was filed beyond the 2000 FPAA's three year window. 101 Fed. Cl. 498 (2011). Each opinion and a number of other orders triggered the filing of numerous docket entries. Early on we accepted plaintiffs' assertion that the risk of unnecessary disclosure of private tax information outweighed the presumption of public access and allowed the redaction of information from numerous docket entries. We indicated that we would reassess that approach as the case progressed. See, e.g., Order of August 3, 2010, Russian Recovery Fund Ltd. v. United States, No. 06-30T (Fed. Cl. Aug. 3, 2010).

The documents at issue (by CMECF docket number), the filing party, and the information plaintiffs wish to maintain under seal are set out below.

With respect to the information plaintiffs seek to redact from Document 56, other than social security numbers and EINs, we direct that the document be unsealed. We begin with the fact that plaintiffs view the information in the document as relevant, as Document 56 was an attachment to plaintiffs' motion for summary judgment. In addition, in the complaint, plaintiffs name Zimmerman and allude to the university and the trust. Ms. Zimmerman was a representative partner with respect to numerous rulings. While the university may have no direct or even indirect economic interest, defendant included the name of the university in materials it submitted in support of its May 22, 2009 motion to dismiss and asserts that it was necessary to use information related to the university to trace allocated losses. Such losses were pertinent to the issues resolved in our decision on the jurisdictional deposit requirement. See 90 Fed. Cl. 698, 703 (2008). The trust was named in a number of documents, some of which the parties have agreed to unseal. The same holds true for the name of a remaining individual, a name which appears in the complaint and two unsealed documents.

This result applies as well with respect to Documents 85 and 105, as to which plaintiffs wished to redact the name and address of the university. Those documents shall be unsealed without redactions.

With respect to Documents 75 and 76, we take at face value defendant's assertion that the entirety of Ms. Zimmerman's tax returns was relevant to its ability to trace her losses and support defendant's argument with respect to the amount of the deposit required. The court is poorly positioned to revisit the motion to determine what information in the attachments was essential to defendant's argument. Her information need not be redacted, except with respect to social security number or EIN.

Also in Document 76, two funds not discussed above, apparently partners which did not receive loss distributions, are mentioned on pages B00261, B00263, B00401, and B00403. Other than the fact that these firms appear in documents filed with the court, defendant provides no reason for why these funds are relevant. Those names and EINs may be redacted.