Opinion
286-21
12-06-2023
CURTIS K. KADAU & LORI A. KADAU, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Christian N. Weiler Judge
This case is set for trial at a special session of the Court commencing on February 20, 2024, in Tampa, Florida. On November 7, 2023, respondent filed two separate Motions to Compel the Depositions of Mark Elwell and Marn Rivelle. On November 30, 2023, petitioners filed responses to the Motions to Compel the taking of Depositions.
In the first Motion to Compel, it states how Mr. Elwell, Vice President, Risk, of RMC Group, was involved in structuring the captive insurance arrangement, and respondent seeks his testimony regarding: aspects of the micro-captive arrangement generally; his interaction and involvement with petitioners, R&A, RMC P&C, RMC Consultants Ltd., CJA and Associates, RMC Reinsurance Company, Ltd., and others associated with the purported micro-captive arrangement; and his business relationship with Mr. Anker. While in the second Motion to Compel, it states how Mr. Rivelle was involved in structuring the captive insurance arrangement, and respondent seeks his testimony regarding: aspects of the micro-captive arrangement generally; the steps or process used to determine premiums for the purported captive insurance policies issued by R&A; the steps or process used to determine premiums for the purported policies issued by RMC P&C; his interaction and involvement with petitioners, R&A, RMC P&C, RMC Consultants Ltd., and others associated with the purported micro-captive arrangement; and his business relationship with Mr. Anker.
After the filings of these two Motion to Compel the Depositions of Mark Elwell and Marn Rivelle, respondent filed a Motion to Compel Respondent's Third Request for Production of Documents. Respondent's Third Request for Production of Documents seeks records and other documents for the micro-captive arraignment between petitioners, Surface and the insured, which includes R&A, RMC P&C.
In their response to the Motions, petitioners indicate how they have produced some 7,000 documents in which the general aspects of the micro-captive arrangements are located and that communications sought between the deponents and petitioners do not exist. Petitioners also indicate how the IRS has interviewed Mr. Rivelle on two separate occasions regarding his business dealings with Mr. Anker, first with IRS Counsel present and the second with the Department of Justice Tax Division present.
In K & M La Botica Pharmacy, Inc. v. Commissioner, T.C. Memo. 2001-33, 2001 WL 117701, we identified three factors to consider in granting these types of motions:
(1)Whether the movant has established a specific and compelling basis for the deposition;
(2)Whether the movant intends the deposition to serve as more than a substitute for cross-examination at trial; and
(3)Whether the movant has had prior opportunities to obtain the desired information or could obtain it through other means or from another source.
At this point, we are not inclined to grant respondent's Motions to Compel Depositions considering these factors.
Considering the foregoing, it is
ORDERED that on before December 19, 2023, respondent shall file a reply to petitioner's responses to respondent's Motions to Compel Depositions, filed on November 30, 2023.