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Inside a Virtual Settlement Day

Posted on Aug. 14, 2020

Today guest blogger Bob Probasco returns with a detailed account of his recent Virtual Settlement Day experiences in Texas. Bob also offers some advice for those participating in future VSD events. Christine

Virtual Settlement Days are the new craze, as IRS Counsel and the Tax Court press for making progress on cases even under our current difficult circumstances.  Several of you likely have already participated in one or more VSD; many others at least have heard about them from others who have participated.  Counsel put a team together to establish a general process and issued a “Best Practices” guide.  But the VSDs are organized by local offices, and likely there is some degree of variety from place to place.  So I thought there might be some benefit to PT readers from additional sharing of experiences by those of us who have already been through this.  I hope to hear more from others.

The Pre-COVID History

Some of my comments may make more sense if I start out with a brief overview of what Texas was doing, for both calendar calls and settlement days, before the coronavirus. The environment within which we operated influenced how VSDs were organized and operated and may have resulted in some differences (good and bad?) from VSDs elsewhere.

Texas has five different cities where the Tax Court holds trial sessions – Dallas, El Paso, Houston, Lubbock, and San Antonio. The IRS Counsel office in Dallas handles Dallas and Lubbock trials; their office in Austin handles San Antonio and El Paso trials; their office in Houston handles Houston trials. Texas has eight LITCs and our state bar Tax Section has a long-established calendar call program, created by Elizabeth Copeland back in 2008. The state bar program has coordinators for Dallas, Houston, and San Antonio; the coordinators generally have a small group of volunteers they rely on regularly.

Texas’s experience with in-person settlement days dates to 2014, with the first one in San Antonio. Rachael Rubenstein, when she directed the LITC at St. Mary’s University School of Law, brought the idea back to Texas from an LITC conference and helped organize it with Counsel. It was a successful trial, although only one IRS attorney came down from Austin. (The need to travel is usually a complication for the IRS.) Dallas started its settlement days in 2016, normally on a Saturday morning at one of the local clinics. They’ve been very successful. Houston and San Antonio started more recently.

Enter the VSDs

Texas was not the first location to have a VSD, but Counsel quickly scheduled three this summer. The first, organized by Counsel’s Dallas office, for cases in Dallas and Lubbock, was scheduled over three days, Thursday 6/25 through Saturday 6/27. Counsel sent out 96 invitation letters; 26 petitioners replied to make an appointment. We were ultimately only able to hold meetings with 18 of them, as we ran low on volunteers. More about that later. I took four appointments, the SMU clinic took three, we had eight state bar volunteers who took nine appointments, and two petitioners had other representation and didn’t ask to meet with a pro bono volunteer. Three petitioners cancelled or no-showed and one settled in advance of the appointment. All told, nine cases settled and another five moved toward settlement. This was a very successful event, with better turnout than we usually had in Dallas for in-person settlement days.

The Houston and Austin offices of Counsel scheduled their VSDs for the week of July 20th. Houston had about twelve appointments; Austin had five. I haven’t heard yet as much about how those events went, other than one appointment I had, but my impression was that those also were very successful.

That’s the high-level summary; what follows are my specific experiences.

Thursday, June 25: Dallas Counsel sent out the invitation letters and scheduled appointments as petitioners contacted them. Counsel then emailed a link to the WebEx meeting to petitioners with confirmed appointments a couple of days in advance of the meeting. The email asked the petitioners whether they wanted to talk with the pro bono volunteer in advance. My first appointment was an EITC substantiation case and talking in advance and sharing documents might have been very helpful. But the petitioner didn’t ask to talk with me in advance and I met her only at the beginning of the virtual session. My understanding of WebEx is that the host can allow any participant to share their screen. Depending on how tech-savvy the petitioner was, she might have been able to share her documentation with us during the meeting and we might have been able to settle.

But we ran into a snag.  Two WebEx servers crashed that morning and the meeting had to be rescheduled as an IRS telephone conference call.  The petitioner had documents but couldn’t share them over the phone.  The IRS attorney had virtually nothing; the petitioner had submitted documents to Appeals last fall, but they hadn’t been uploaded and the physical administrative file was of course not available to Counsel.  In a situation like that, you can discuss generalities, but you may not be able to settle until later.  My clinic later took on the petitioner as a client and I’m hopeful we’ll settle soon.

Friday, June 26: This petitioner, whose case was for Lubbock, did send me a lot of documents in advance. My schedule precluded a telephone or Zoom meeting before the appointment, but I was able to evaluate his situation and we communicated by email. The actual WebEx meeting ran into another snag. There were still some potential problems with the WebEx servers, I think related to capacity, so Counsel came up with a workaround. We used WebEx for video only and a telephone conference call for audio.

I had already provided him with substantial advice by email Wednesday and Thursday nights, but we talked through the issues more.  I had concluded earlier that this CDP case would likely not settle; it seemed to be almost entirely based on strongly held but very different interpretations of tax law, rather than factual disputes.  When I’ve encountered such cases in the past, they never seem to settle.  Sure enough, on Friday there was some discussion but no settlement.  However, we did clarify some of the petitioner’s arguments and gained additional information.  I also communicated with the petitioner by email Friday night to answer some additional questions he had and clarify some aspects of court procedure.  It’s unfortunate when you’re unable to progress toward settlement in a Virtual Settlement Day, but perhaps the meeting at least contributed to resolution of the case.

I had a second appointment on Friday, but that petitioner did not show up.

Saturday, June 27: This petitioner’s case was also for Lubbock, and he also sent me quite a few documents in advance. And again, my schedule was busy so it wasn’t until late Friday night that I had an opportunity to review everything and email him with my preliminary evaluation. The meeting proceeded similarly to the one the day before. And this appeared also to be an instance of strongly held but very different interpretations of tax law.

Although I understand that WebEx does have “breakout room” functionality, the original plan was for the IRS attorney to make the pro bono volunteer a co-host, and then leave the WebEx meeting to allow a private conversation. But once again we were using WebEx for video only and an IRS conference call for audio. There was no way for the IRS attorney to leave the conference call without terminating it. So instead, the petitioner and I left the WebEx meeting and the IRS conference call; then I called the petitioner for a private conversation. After that, we returned to WebEx and the conference call.

Although we weren’t able to reach a settlement, I was able to provide information to the petitioner about the strength of his case and answer some questions about court procedure.  Since there apparently was no dispute concerning the material facts, I suggested a submission without trial under Rule 122 would be appropriate and more convenient than appearing for trial.  I think both petitioner and the IRS attorney were satisfied with that approach and will cooperate in stipulating the facts, so this case seems headed toward resolution.

That was it for the Dallas event. We had enough state bar volunteers, along with the clinics, for the Houston and Austin event, after some balancing between the two. But the Austin event got a last-minute email from a petitioner on Wednesday asking for an appointment on Thursday, so I volunteered to take that one.

Thursday, July 23: Another CDP case. For the Dallas VSD, Counsel copied the applicable volunteer when emailing a petitioner with a link for the WebEx meeting.  I didn’t know who the petitioner was on this case until the virtual meeting began. I’m not sure if that was a conscious decision by Austin Counsel to delay the communication of the petitioner’s name as long as possible or just a result of this being a last-minute appointment. I don’t know if he was offered an opportunity to talk with me in advance, but if he was, he didn’t pursue it.

We were able to use WebEx for both video and audio this time, and I had an opportunity to experience sharing documents within WebEx.  The IRS Attorney showed us the Notice of Determination.  It’s a little bit awkward when someone else is at the controls (I’m gaining sympathy for what my students in a virtual class go through) and I didn’t capture in my notes all of the important information for reference later when we had a private conversation.  But the process works.

We ran into problems when transitioning to a private meeting between me and the petitioner. The IRS attorney left the WebEx meeting, as planned, but that unexpectedly kicked all of us out the meeting and the IRS attorney had to schedule a new WebEx meeting and invite us. None of us were absolutely sure if that would happen again, so the petitioner and I decided to have our private conversation outside of WebEx. The IRS attorney kept the WebEx meeting going, the petitioner and I exited, and then he and I had a Zoom meeting. (You’re probably wondering why I didn’t use Zoom for private conversations with petitioners during the Dallas VSDs. So am I. IRS Counsel only uses WebEx for videoconferencing but that restriction wouldn’t apply to a meeting that IRS Counsel does not attend. It should have occurred to me earlier as it would have been easier than a cellphone call.)

After we returned to the WebEx meeting to discuss the case with the IRS attorney, there were a couple of times that the petitioner wanted to speak with me privately again.  The discussions were likely to be brief, so we came up with a workaround rather than returning to Zoom.  The IRS attorney left the WebEx meeting going but left his office so he couldn’t hear us, then came back in five minutes.  A little inconvenient for him but, unlike my other VSD cases, we were able to reach a settlement.  Hurray!


Compared to the in-person settlement days, there were some noticeable differences – some better, some worse. Overall, I thought the VSDs went well. Counsel is to be commended for their efforts in trying to make progress on the cases even under today’s difficult circumstances. In reflecting over it, there were also some things to consider the next time around.

Choice of cases to invite. Our Dallas in-person settlement days usually invited petitioners whose cases were scheduled for trial in the next 2-3 months, and sometimes Counsel limited the invitations to cases they considered good candidates for settlement. For the VSDs, it seems as though the invitation list was crafted more broadly. Of the four cases I assisted with, three were in the very early stages and had not yet been set for trial. (The fourth had been set for trial in May, before the Tax Court cancelled those trial sessions.) I was somewhat surprised by that, as often at that stage Appeals has jurisdiction. But if we can settle cases earlier, bring them on. It seemed to work well overall.

I think there’s an argument for only inviting cases for which Counsel thinks progress is likely.  I’ve heard in the past about in-person settlement days where that approach was taken but here it seems Counsel may have not focused as much on that.  Progress seemed unlikely for two of my four appointments.  I understand that Counsel may have difficulties with a case and hope that a volunteer will persuade a petitioner that a proposed resolution is reasonable.  And that happens sometimes even if the proposed settlement is a full concession by the petitioner; the petitioner may believe a volunteer who tells her that she should concede, but not trust Counsel who says the same thing.  Even though the petitioner isn’t any better off, the judicial process is.  The Court and Counsel both appreciate any intervention that results in resolution before trial.

On the other hand, there are some cases for which it seems extremely unlikely from the very beginning that a volunteer will change either party’s point of view. Is it worthwhile to invite those petitioners to a settlement day, whether in-person or virtual? I didn’t think it would be in those two cases I assisted with, and I was surprised that they wound up at the VSD. But in retrospect there was some movement (very slight) toward resolution, even if the cases would not settle. And the petitioners hopefully got some useful information from me, even if not what they may have hoped for. I wonder whether the petitioners and Counsel thought the VSD was beneficial for those cases.

Time:  Our Dallas settlement days were always held on Saturday mornings. Several IRS attorneys and several pro bono volunteers would show up for the entire morning. We could get through 10 – 15 meetings easily and typically no one was committed for more than four hours. The VSDs were mostly held during the week and spread over several days. That is probably more convenient for Counsel and LITCs, as this is part of their day job and most meetings were during our normal work hours. The total time set aside was much more than the four hours for our Dallas in-person settlement days, but IRS attorneys and pro bono volunteers alike only had to be there for their meetings, rather than the whole time, so the total time commitment may have been similar. It also seemed to be better for petitioners, at least if there was a Saturday option. And no one had travel time to get there.

There is a possible downside for state bar pro bono volunteers, as most of the meetings were during the work week when they often have other commitments, rather than on the weekend.  Perhaps as a result, the volunteers may have been more likely to volunteer for only one or two appointments instead of handling four at an in-person settlement day.  Part of that may also be a result of more time set aside for VSD appointments and in-person, as the process can be a little bit slower.

This is a balancing act and the plan for our VSDs may be the right one for VSDs going forward, but it’s something to think about. Most importantly, the organizers for the pro bono volunteers may need to consider that more than the normal number of volunteers may be needed when moving from in-person to virtual.

Location: This was a huge advantage of the VSDs. The obvious advantage is eliminating travel time for everyone but there are two other aspects. First, VSDs allowed Counsel to combine cases from more than one trial location. We had done in-person settlement days for Dallas trial sessions. But Dallas Counsel also handles Lubbock trial sessions. Even if they organized an in-person Lubbock settlement day, travel costs for the Dallas IRS attorneys would have limited participation. With a VSD, however, it was easy to invite petitioners with cases for both cities. The second advantage of a VSD is that it facilitates getting pro bono volunteers.

Soliciting volunteers: We had started to cast our net wider for the state bar volunteers even before COVID. Last year, the Texas Tax Section started sending out blast emails to the entire membership inviting them to sign up as volunteers for calendar calls or settlement days or Adopt-a-Base training sessions. (Rachael Rubenstein implemented this initiative for soliciting volunteers for us.) It’s part of a balancing act between asking our “regulars” to stay involved and diversifying our volunteer base (expanding base, involving younger attorneys, etc.).

When we switched from in-person settlement days to VSDs, though, that had an even greater reach.  Our Dallas VSD had eight state bar pro bono volunteers, of whom three were from Houston.  Our Houston and Austin VSDs in turn drew volunteers from Dallas.  We even got an out-of-state volunteer from D.C., who happened to be a member of the Texas bar.  (Thank you!)

We turned out to have more petitioners wanting to participant in the Dallas event than the volunteers could cover, and some never made it off the waitlist. But that was primarily because we got a later start than for the Houston and Austin events. The next time we do this, I think we’ll be able to get more volunteers.

It takes effort to solicit intrastate volunteers but the ability to serve more petitioners is worth it. The program that Rachael started in Texas gave us a head start in that, although she also had to put in a lot of effort connecting the volunteers to the petitioners. The time slots the volunteers asked for didn’t match exactly with the petitioner appointments. I doubt if we would have had as many volunteers without that program already in place. Other state bars may want to investigate something similar if they’re not doing it already.

This advantage of a VSD in attracting volunteers who do not live in the area will also apply to calendar calls as the Tax Court starts its remote trial sessions.  We tend to need fewer volunteers at calendar calls then at settlement days, but the potential for interstate assistance can greatly help locations that do not have clinics or an established state bar program.  It will be more difficult to coordinate than intrastate volunteers, but Meg Newman at the ABA Tax Section is already doing some of this.  The Texas bar will be helping with a VSD, and possibly a calendar call, for Las Vegas later this year.

Technology: We had some issues with WebEx during the Dallas VSD, although most of that may have been just temporary glitches rather than recurring problems. However, I suspect many of the pro bono volunteers mostly use Zoom and are unfamiliar with WebEx; I know I was. Even some of the individual IRS attorneys may not have been familiar with the full range of functionality used in a VSD – sharing documents, selecting a co-host, etc. For that matter, petitioners might also struggle with sharing documents if they were unfamiliar with the technology.

We did get an instruction guide for signing in and a video tutorial in advance of the VSD. That was helpful. In retrospect, it might have been beneficial to have a live run-through to acclimate to the software. But it’s hard to find time for this in everyone’s busy schedule. This will get better over time, though, as everyone gains more familiarity.

Sharing information.  This is a disadvantage of VSDs, compared to in-person.  At the in-person events, petitioners and Counsel both often bring documents to the event and it’s easy to give them to the volunteers to look at those throughout the meeting with petitioners.  That’s harder to do through videoconferencing.  Petitioners may not have the documents in electronic format, for screen sharing, and holding a document up to the camera may not work well.  It can be awkward for the volunteer to refer back to documents during the discussion if petitioner or Counsel are sharing them through the screen.  And after Counsel leaves the meeting, any documents shared by them are – I assume – not available during the private conversation between volunteer and petitioner.

For the Dallas event, the invitation letter invited petitioners to send documents to Counsel in advance; a couple of days before the meeting, Counsel offered to put petitioner and volunteer in touch to discuss the case before the meeting. I think there was little, if any, information shared ahead of time, though. Maybe a more assertive approach, earlier in the process, would change that. Perhaps when the petitioners respond to the invitation letter to schedule an appointment Counsel could: (a) explain the benefits of talking with the volunteer in advance; (b) strongly suggest that it would be beneficial to send documents to Counsel in advance and ask whether those could be shared with the volunteer; and (c) ask the petitioner if documents already filed with the court (e.g., petition/notice of deficiency, any pending motions, etc.) could be shared with the volunteer in advance.

At some VSDs, cases were “recalled” for later in the week or a subsequent week. That can be a good solution for this issue and would likely work well for Counsel and clinic volunteers. But it might be harder for state bar volunteers to squeeze a second meeting into an already busy schedule. For clinic volunteers, there is also the option of entering an appearance in the case and continuing through resolution; state bar volunteers do that less rarely. Of my three VSD cases that did not settle, I did that for one but chose not to for the other two.

This is certainly not a big issue.  We can get documents and information from the petitioner and Counsel during the virtual meeting, which is essentially what typically happens at an in-person settlement day or a calendar call.  But virtual seems slower than in-person and anything that helps speed up the process might help.

Parting thought

VSDs will take some getting used to, and they have some obvious challenges. But they also offer significant advantages. My experiences were definitely positive. If you’ve been hesitant about participating in one, don’t be. I think it would also make sense to continue offering at least some VSDs or virtual trial sessions even after COVID is long behind us. Just like so many other things, the result of the pandemic may be a permanent and substantial change in how we work.

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