IN CAMERA REVIEW GRANTED FOR IRS DOCUMENTS IN FICA REFUND SUIT.

In Plaintiff's First Set of Document Requests, Emory requested that the Government produce "[all] Forms W-2, W2c, and any other Document relating to the amount of FICA taxes paid or reported by Emory University for the period January 1, 1995 through December 31, 2005 with respect to each Emory University medical resident named in paragraph (2) of Emory University's Certificate of Interested Persons (filed on September 24, 2007)."¹ On November 30, 2007, the Government agreed to produce responsive documents. However, during the parties' subsequent meet-and-confer discussion regarding deficiencies in the Government's responses generally, the Government stated that it would be burdensome to produce forms W-2 and W-2c. In response, Emory served the subject Requests for Admissions ("RFAs") on February 4, 2008, requesting that the Government admit Emory's figures for the FICA tax payment amounts for each resident for the period at issue. The RFAs consisted of a list of each resident's social security wages, social security tax withheld, medicare wages and tips, and medicare tax withheld. The list covers the ten taxable years and includes approximately 4,500 individuals. The 326 page document has 13,656 entries, with four columns per entry that Emory has asked the Government to admit.

Emory also served a Second Set of Document Requests, asking that the government produce all documents (including any Forms W-2 and Forms W-2c), on which the Government relied to deny the truth of any particular resident amount set forth in the RFAs. This second set was an attempt to request only those documents relating to resident amounts that the Government disputes.

A response to the RFAs was due from the Government on March 5, 2008. On February 13, 2008, Emory proposed a stipulation as to the accuracy of the chart and proposed to withdraw the Requests for Admission in the event that the parties could reach such a stipulation. In a letter dated February 29, 2008, the Government stated that Emory's request was overly burdensome, especially in light of the fact that Emory already had the requested data and the fact that verification of each entry in the chart could take up to a year for the Government to complete. In an effort to compromise, the Government instead agreed to sign the stipulation upon verification of Emory's W-2 figures for a random sample of 50 residents. Emory did not withdraw the RFAs based on the Government's letter, nor did it express any objection to the Government's proposed plan.

On March 12, the Government informed Emory that most of the W-2 records were in storage and that it would take 6-8 weeks for the IRS to retrieve them to conduct the sample. After further investigating this sampling process, the IRS estimated that it would require 1400 hours of work, which would take 6 to 8 weeks, to conduct the sampling process. The Government advised Emory of this estimate on March 12, 2008. Emory was not satisfied with the time it would take the Government to review the chart, so it filed the instant Motion to Deem Admitted Plaintiff's First Set of Requests for Admission [73]. Subsequent to completion of the briefing of this Motion, the Government filed a supplemental response [105] stating that, having completed its sample review and found no errors in Emory's data, it admitted the requested information. Accordingly, Plaintiff's Motion [73] is DENIED, as moot.

At the outset of discovery in the case, Emory requested the IRS's documents relating to Emory's refund claims, including documents relating to the IRS's audit. Emory also requested any memoranda, evaluations, analyses, reports, and studies relating to whether medical resident wages paid by Emory should be exempt from FICA taxation under the student exception. In response, the Government produced e-mail correspondence between Ms. Viris Pownell-Williams, an IRS employee, and Ms. Carman Avery, an IRS agent who worked on the audit of Emory's refund claims. The e-mail correspondence references the existence of a report drafted by Avery on or around October 4, 2001, setting forth her audit findings concerning whether Emory's medical students qualify for the student exception -- the Avery Report. According to the e-mail, Avery determined that Emory medical residents should be exempt from FICA taxation under the student exception. The e-mail also states that Avery provided a copy of her nine-page report to Pownell-Williams. When the government refused to produce this copy, Emory filed a Motion to Compel [88].

The Government has asserted a deliberative process privilege and refuses to disclose the contents of the Avery Report. The Government has filed a motion [96] for in camera review of the Avery report as well as two other related documents in order for the Court to determine whether the deliberative process privilege should apply to the Avery Report. The Court accepts the government's invitation to review these documents in camera before making a determination of whether the privilege should apply. For this reason, the government's Motion for In Camera Review [96] is hereby GRANTED. The Court therefore reserves ruling on Emory's Motion to Compel [88].

SO ORDERED, this 25th day of July, 2008.