Opinion
12362-21
12-05-2023
BEAVERDAM CREEK HOLDINGS, LLC, BEAVERDAM CREEK INVESTORS, LLC, TAX MATTERS PARTNER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Joseph Robert Goeke Judge
Respondent issued a subpoena to Bridge Capital Associate, Inc. (BCA), on or about July 12, 2023. No documents were provided to respondent at the time of a Document Subpoena Hearing held September 27, 2023. Respondent filed a Motion to Enforce Subpoena on November 3, 2023. Respondent then received BCA's production on November 6, 2023, with redactions. BCA provided a privilege log to respondent several weeks later.
BCA's privilege log lists three documents that it withheld. BCA claimed attorney client privilege with respect to all three of the documents. BCA also claimed work product privilege with respect to two of the documents. Respondent has raised the possibility that the documents are not privileged as claimed by BCA. We have reviewed the privilege log and agree that the documents may not be privileged. Accordingly, we will order BCA to produce the three documents for in camera review.
BCA also redacted portions of 181 other documents that were produced. Two of these redactions were to protect personal information and respondent does not contest them. BCA states in the privilege log that the other 179 redactions are due to "Nonresponsive Information."
Tax Court Rule 72(b)(3) provides that "A party shall produce documents as they are kept in the usual course of business or shall organize and label them to correspond to the categories in the request." This is almost identical to Rule 34(b)(2)(E)(ii) FRCP. Neither the Tax Court Rules or the FRCP provide for redactions on grounds that a portion of document is non-responsive or irrelevant.
District Courts are split on whether irrelevance or non-responsiveness are appropriate grounds for redactions in documents. Doe v. Trump, 329 F.R.D. 262, 274 (W.D. Wash. 2018); see also Durling v. Papa John's Int'l, Inc., 2018 U.S. Dist. LEXIS 11584, 2018 WL 557915, at *9 (S.D.N.Y. 2018) ("[R]edactions on grounds of non-responsiveness or irrelevance are generally impermissible * * *.).
We believe it is unwise to permit a third party to redact portions of documents on responsiveness or relevancy grounds. Such redactions deprive the reader of context and cause the parties and the Court to spend time reviewing and addressing the production. Third parties are also not in the best position to determine what portions are relevant and/or responsive. We also believe that producing unredacted documents is most in line with the directive that "A party shall produce documents as they are kept in the usual course of business * * *." Tax Court Rule 72(b)(3).
For the reasons stated above, it is
ORDERED that BCA produce the 3 attorney client privilege documents to the Court for in camera review on or before December 12, 2023. Prior to December 12, 2023, BCA should contact chambers at (202)521-0690 to arrange for production. It is further
ORDERED that BCA remove the 179 redactions attributable to "Nonresponsive Information" and provide the unredacted documents to respondent. If some redactions should remain for reasons other than responsiveness or relevancy, BCA shall provide documents with only those redactions, alongside a privilege log, to respondent by December 20, 2023. It is further
ORDERED that in addition to the usual service upon the parties, the Clerk of the Court is directed to serve a copy of this Order on John M. Alten,1660 West 2nd Street, Suite 1100, Cleveland, OH 44113.