Opinion
23354-21
07-23-2024
NAT S. HARTY & APRIL D. HARTY, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Kathleen Kerrigan, Chief Judge
On May 30, 2024, nonparties Stanley Crow and S. Crow Collateral Corp. filed a Motion to Quash Third-Party Subpoena Or, in the Alternative, for a Protective Order (Motion to Quash). The motion to quash concerns a subpoena served by respondent on May 13, 2024, to Stanley Crow notifying him of a deposition. On July 2, 2024, respondent filed a Response to Motion to Quash Third-Party Subpoena Or, in the Alternative, for a Protective Order.
Mr. Crow and S. Crow Collateral have advanced several arguments in support of quashing the subpoena. Rule 74(f) provides that Rule 81(e) is applicable to depositions for discovery purposes. Rule 81(e)(3) provides that "[n]o deposition may be taken before a person who is a relative or employee or counsel of any party, or is a relative or employee or associate of such counsel, or is financially interested in the action," except "with the consent of all the parties or their counsel." Rule 81(e)(3) is similar to Federal Rules of Civil Procedure 28(c), 29(a), and 30(b)(5)(A). "[T]he policy informing" Federal Rule of Civil Procedure 28(c) is "to assure impartiality in the creation of the record of the deposition." Sheppard v. Beerman, 822 F.Supp. 931, 941 (E.D.N.Y. 1993). It is appropriate to quash a subpoena that purports to subject a deponent to a deposition taken by an interested person absent the parties' consent. See Hudson v. Spencer, Civil Action No. 11-12173-NMG, 2014 WL 11015484, at *8-9 (D. Mass. Nov. 4, 2014) (quashing notices of deposition designating a party's employee as the officer before whom a deposition was to be taken, stating that "it is incumbent upon . . . the party noticing the deposition[] to procure another officer to administer the oath and record the deposition," and stating that opposing counsel was not required to "stipulate to using an . . . employee to conduct the deposition").
Unless otherwise provided, Rule references are to the Tax Court Rules of Practice and Procedure.
The subpoena issued by respondent identifies respondent's counsel as the "officer or recording company" by whom "[t]he deposition will be recorded." This runs afoul of Rule 81(e)(3). In addition, the parties' Stipulation to Take Deposition of Stanley Crow and Steven Vaught does not evidence petitioners' consent for the deposition to be taken before respondent's counsel. To the contrary, petitioners agreed that a named court reporting company would transcribe the deposition, not respondent's counsel.
Even if this technical defect could be cured, we would still quash the subpoena. Deposition of a nonparty witness is an extraordinary method, and may only be used when the information sought cannot be obtained in documents or through informal communication or consultations. See Rule 74(c)(1)(B). Respondent has not shown that the only way to obtain the information being sought is by issuing a subpoena. We will therefore quash the subpoena. We expect the parties and their counsel to cooperate in making nonparty witnesses available in this case. In addition, this Order does not prohibit respondent from serving a new subpoena on Mr. Crow or S. Crow Collateral that cures the defects and shows that a subpoena is the only method for seeking the information. Therefore, it is
ORDERED that Stanley Crow and S. Crow Collateral's Motion to Quash Third-Party Subpoena Or, in the Alternative, for a Protective Order, filed May 31, 2024, is granted. It is further
ORDERED that the subpoena issued by respondent to Stanley Crow on May 13, 2024, is quashed. It is further
ORDERED that the Clerk of the Court shall, in addition to regular service on the parties, serve a copy of this Order on third-parties at their counsel's address as set forth in the motion.