Of all the routines in judicial gymnastics, few have a higher degree of difficulty than the reverse benchslap, and we’re trying for a combination double with our Opinion today.

– Judge Mark V. Holmes of the United States Tax Court, dissenting in Tigers Eye Trading, LLC v. Commissioner.

(The background behind this judicial invocation of the term “reverse benchslap,” after the jump.)

The quoted material appears at the very end of Judge Holmes’s dissent. You can find it on page 211 of the collected opinions.

Here’s a quick and dirty summary of what went down. The Tigers Eye majority apparently had some not-very-flattering things to say about the D.C. Circuit’s approach to certain procedural issues in partnership tax law. It decided to say those things in a decision that is appealable to — wait for it — the D.C. Circuit. As Judge Holmes explains in the opening paragraph of his dissenting opinion:

It is customary and appropriate for us to reconsider an issue after being reversed by a circuit court, and stick to our position if we think it right. But only if the case we use to reaffirm ourselves is appealable to a different circuit. When, as unfortunately we do today, we brazenly challenge the D.C. Circuit’s precedent in Petaluma FX Partners, LLC v. Commissioner, 591 F.3d 649 (D.C. Cir. 2010) (Petaluma II), aff’g in part, rev’g in part and remanding in part 131 T.C. 84 (2008) (Petaluma I), in a case appealable to that court we risk being seen as impudent. We also risk not even getting that court to reconsider — the D.C. Circuit treats its published opinions as stare decisis for later panels, see, e.g., Sierra Club & Valley Watch, Inc. v. Jackson, 648 F.3d 848, 854 (D.C. Cir. 2011), so what we are really asking is for the parties to appeal and then petition for en banc reconsideration.

Translation: “Umm, guys, aren’t we setting ourselves up here to get smacked down by the folks upstairs?”

Here’s more from the conclusion of Judge Holmes’s opinion (from which the original quotation was taken):

In conclusion, I believe that we shouldn’t challenge the D.C. Circuit on the issue of our partnership-level jurisdiction over penalties any more than we should challenge it on the issue of outside basis as a partnership item. Of all the routines in judicial gymnastics, few have a higher degree of difficulty than the reverse benchslap, and we’re trying for a combination double with our Opinion today.

I’ll stand a safe distance off to one side, and respectfully dissent.

A three-judge panel?

Translation: “Isn’t a benchslap supposed to be administered by a higher authority to a party with less power? When a lower court attempts a ‘reverse benchslap’ — i.e., disses on its own reviewing court — isn’t the lower court just inviting a smackdown of epic proportions?”

Given the apparent complexity of this case, I will not embarrass myself by attempting a more comprehensive explanation. If you’re a tax lawyer who understands this matter, have at it, in the comments.

Tigers Eye Trading, LLC v. Commissioner [U.S. Tax Court]


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