Whistleblower’s Motion to Proceed Anonymously Granted, Unless Court Determines Differently (Whistleblower 12568-16W, TC)

CCH Tax Day Report

An individual was permitted to proceed anonymously in a whistleblower action. The individual presented a sufficient showing of harm that outweighed counterbalancing societal interests in knowing his identity. The individual, who was previously employed by an entity related to the taxpayer, claimed knowledge of significant unlawful tax code violations by the taxpayer and its affiliates that he acquired in the normal course of his employment.

The individual had a well-founded concern that disclosure of his identity would cause the taxpayer to retaliate against him and his family, resulting in professional and personal ostracism, economic loss and threats of physical harm. In addition, disclosure of the individual’s identity was likely to cause severe damage to his standing in his professional community, as well as embarrassment both professionally and personally. Moreover, the individual supported his claim that he would be at risk of retaliation, physical harm, social and professional stigma and economic distress with a 13-page supplemental declaration and 250 pages of exhibits.

However, weighing the potential harm from disclosing a whistleblower’s identity against the counterbalancing social interests can shift as a case progresses. Thus, the protection that a whistleblower receives from the granting of a motion to proceed anonymously is provisional and given the extraordinary amounts of uncollected tax and penalty liabilities individual has alleged, with the possibility that petitioner might receive a whistleblower award that might equal or exceed $1 billion, at some future time the balance between the alleged harm to the whistleblower and the societal interest in knowing his identity may shift and that anonymity may no longer be justified.

Whistleblower 12568-16w, 148 TC —, No. 7, Dec. 60,854

Other References:

Tax Court Rule 345

CCH Reference – 2017FED ¶42,417K.60

Tax Research Consultant

CCH Reference – TRC IRS: 63,060.05

AUTHOR

CCHTaxGroup

All stories by: CCHTaxGroup

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