Opinion
17483-21
02-07-2024
ARDAN HOLDINGS, LLC ARDAN INVESTORS, LLC, TAX MATTERS PARTNER Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Mark V. Holmes Judge
This case arises from a contested donation of a conservation easement. We're set to try it at a special session of the Court starting on February 26, 2024, in Columbia, South Carolina. The parties continue to file pretrial motions, and on February 5, petitioner moved for a protective order under Rule 103 after it learned that respondent was planning to serve subpoenas duces tecum on 27 witnesses. It's unclear exactly what petitioner is asking for-in the motion's conclusion it asks for an order to "require Respondent to seek leave of Court before issuing any additional subpoenas"-but it also seems to seek their quashing or maybe a declaration that the subpoenas are void and unenforceable, and maybe even an order requiring respondent to return or destroy any information that he's received from the subpoenas.
Petitioner has two grounds: that serving these subpoenas violates the pretrial order in this case, and that it violates Rule 147.
The first is easy to rebut. Our pretrial order did set January 4 as the deadline for completion of discovery. Rule 70(a)(1), however, defines discovery to consist of interrogatories; production of documents, electronically stored information, and things; and depositions. Subpoenas are not a form of discovery. Respondent has not violated the pretrial order.
The second ground, that service of these subpoenas violates Rule 147, requires a timeline and some discussion.
As best we can tell from the parties' papers, here's the timeline:
• Circa Jan. 29-respondent emails to eight of the witnesses advance copies of the subpoenas;
• Feb. 2-petitioner learns that respondent has "issued" at least two subpoenas;
• sometime before Feb. 3-respondent serves Cohen & Company with a subpoena duces tecum without notice to petitioner;
• Feb. 3-respondent emails to petitioner a list of the 27 individuals and entities to whom he intends to issue subpoenas, and uploads copies of the subpoenas to petitioner's server; and also on
• Feb. 3-respondent serves subpoenas.
Rule 147(a)(3), as we recently amended it, states that:
If the subpoena commands the production of documents, electronically stored information, or tangible things, then before it is served on the person to whom it is directed, a notice and a copy of the subpoena must be served on each party.
Respondent's subpoenas (or at least some) are subpoenas duces tecum. The Rule thus commanded respondent to serve petitioner a notice and copy of the subpoenas before service. Trying to negotiate with witnesses and their counsel using a draft subpoena is not service, it's ordinary trial preparation. And the Rule speaks of "service", not "issuance" of subpoenas. Rule 147(b)(1) requires physical service on the named person. Emailing doesn't count.
Respondent therefore did not violate Rule 147.
With one exception. As respondent concedes, his process server evidently did serve one of the witnesses before respondent served a copy of that subpoena on petitioner. We'd be inclined to quash that one, but respondent represents that when he learned of the mistake, he immediately withdrew that subpoena and will re-serve it later.
As we've told the parties in this case already, we will not assume without compelling proof that counsel for either of them engages in unethical behavior such as lying to the Court. We'll take respondent's word that he has withdrawn and will re-serve the one questionable subpoena.
It is therefore
ORDERED that petitioner's February 5, 2024 motion for protective order pursuant to Rule 103 is denied.