Updates to Tax Procedure Text re Work Product and Expert Witnesses (9/29/12)

I have just made changes to my Federal Tax Procedure text to update certain portions to reflect changes in Tax Court Rules for discovery and, in one case, the Federal Rules of Civil Procedure discovery provisions related to work product.

The text as revised (sometimes with context) is as follows (footnotes omitted):

Text at 9. VI.F.1.f. -  footnoted version, p. 399; nonfootnoted version p. 293

f. Work Product Privilege. 

The work product privilege (also referred to as the work product doctrine) protects the work product and thought processes in preparing for litigation.  The work product privilege was blessed in the Supreme Court case of Hickman v. Taylor, 329 U.S. 495  (1947) and is now contained in Rule 26(b)(3))(B) of the Federal Rules of Civil Procedure as follows: 

(3) Trial Preparation: Materials.
(A) Documents and Tangible Things. Ordinarily, a party may not discover documents and tangible things that are prepared in anticipation of litigation or for trial by or for another party or its representative (including the other party's attorney, consultant, surety, indemnitor, insurer, or agent). But, subject to Rule 26(b)(4), those materials may be discovered if:
(i) they are otherwise discoverable under Rule 26(b)(1); and
(ii) the party shows that it has substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means.
(B) Protection Against Disclosure. If the court orders discovery of those materials, it must protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of a party's attorney or other representative concerning the litigation.
(C) Previous Statement. Any party or other person may, on request and without the required showing, obtain the person's own previous statement about the action or its subject matter. If the request is refused, the person may move for a court order, and Rule 37(a)(5) applies to the award of expenses. A previous statement is either:
(i) a written statement that the person has signed or otherwise adopted or approved; or
(ii) a contemporaneous stenographic, mechanical, electrical, or other recording—or a transcription of it—that recites substantially verbatim the person's oral statement.
Tax Court Rule 70(c)(3) now substantially tracks these provisions for work product.

Work product subject to the privilege falls into two broad categories – (i) so-called “opinion work product” such as the mental impressions, conclusions, etc. of the attorney or other representative in the litigation and (ii) other work product that relates to facts.  All work product is subject to the require of showing substantial need and undue hardship, but opinion work product is discoverable only by (i) waiver by disclosure to the adverse party, (ii) if disclosed in a manner likely to become known to the adverse party, and (iii) by making an extraordinary showing of substantial need and undue hardship which, as to opinion work product would be almost impossible.

Text at end of 12.II.A.7.c. & d. [new d.] - footnoted version p. 473; nonfootnoted version p. 348

The Tax Court Rules have recently been changed to permit discovery of work product under scope rules similar to the Federal Rules of Civil Procedure.  As noted earlier in the text in discussing the work product privilege, the Federal Rules of Civil Procedure permit the work product discovery upon showing of substantial need and undue hardship, with a opinion work product being very difficult to discover.  

d. Expert Witnesses. 

The Tax Court rules require an expert to render an expert’s report stating the expert’s qualifications, opinions and facts and data upon which they are based.  Provided that the expert is qualified, the report is introduced into evidence and may serve as the expert’s direct testimony, unless there is some reason to elicit oral testimony on direct. 

For the Tax Court's notice of these and other rule changes, see here.  For the Chief Counsel Notice to IRS Counsel re these changes, see Chief Counsel Notice CC-2012-016 (9/13/12), here.