Second Circuit NonTax Opinion on Glitches in the Appellate Process with JAT War Story (9/11/22)

Most readers of this Federal Tax Procedure Blog do not have such tunnel vision that developments outside the tax procedure area are ignored. Many readers will have read or heard about a major bank, Citibank, mistakenly making payments to hedge funds aggregating almost $1 billion on not yet due amounts. Some of the hedge funds tried to keep the mistaken payments (about $500 million) because, they claimed, they were eventually entitled to them anyway. Citibank sued those hedge funds to recover. The district court (SDNY) held that the hedge funds were entitled to retain the mistaken payments based on some arcane creditor concepts in New York law and in the Restatement of Restitution. The Second Circuit reversed and held that the funds must be returned to Citibank. Citibank, N.A. v. Brigade Capital Management, 49 F.4th 42, 58 (2d Cir. 2022) (2d Cir. 9/28/22), CA2 here and GS here.  I won’t get into the merits of that resolution. I focus instead on the procedural trajectory of the case in the Court of Appeals.

I pick up this procedural trajectory from David Lat’s Judicial Notice (09.10.22): Weird, Wild Stuff (Original Jurisdiction Notice 9/10/22), here. I excerpt the following:

[T]he intricacies of the discharge-for-value doctrine, ably explored in 131 pages of opinions-a majority opinion by Judge Pierre Leval for himself and Judge Robert Sack, and a concurrence in the judgment by Judge Michael Park-are far less interesting than all the meta-commentary about the judicial process and the breaking of the fourth wall.

            In his concurrence, Judge Park complained that "this is a straightforward case that many smart people have grossly overcomplicated and that we should have decided many months ago." In response, Judge Leval added an addendum to his opinion in which he acknowledged that the judgment "has taken a long time to produce," for which he accepted "sole responsibility."

            Pulling back the curtain on the judicial decision-making process, Judge Leval explained that one reason for the delay was a change in disposition: he and Judge Sack originally decided to certify the question to the New York Court of Appeals, prepared a draft opinion to that effect, but then decided against certification-mainly because it would add another year of delay, and also because they "became increasingly persuaded, despite initial uncertainties," that Citibank deserved to win.

             Judge Leval then went on to discuss the nature of appellate judging:

            A decision of a court of appeals must satisfy two requirements, which pull it in different directions. It should, as rapidly as reasonably possible, tell the parties who wins. At the same time, recognition that the decision serves as precedential law requires that it rest on, and clearly explain, sound legal principles. In a money dispute, the parties ordinarily care little for the precedential effect of the decision; their interest is to get a rapid answer to who gets the money. A court, however, must pay careful attention to the decision's precedential function…. Finding the best accommodation between the objectives of speed and legal soundness is not always easy.

Taxpayer Advocate Annual Report with Graphics on the Tax Procedure Processes (2/14/19)

The Taxpayer Advocate has issued the Annual Report to Congress for 2018, here.  There is a lot in the report that I will blog on here (or incorporate in the working draft for my next Federal Tax Procedure Book that will be finalized and posted on SSRN in August 2019).

I offer here seven pages of schematic graphics from the report that show the various stages of the tax procedure process.  I think the graphics are good, but for best use requires some understanding of the various steps in the process.  The graphics are as follows:

• Tax Return Preparation Roadmap
• Tax Return Processing Roadmap
• Notices Roadmap
• Exam Roadmap
• Appeals Roadmap
• Collection Roadmap
• Litigation Roadmap

Opinion Writing in the Appellate Process and the Place for Dissents (12/7/12)

I thought it might be helpful for students of the appellate process (hopefully some tax procedure students will  be interested) to know of this article by Judge Diane P. Wood of the Seventh Circuit Court of Appeals:  Diane P. Wood, When to Hold, When to Fold and When to Reshuffle: The Art of Decisionmaking on a Multi-Member Court, 100 Calif. L. Rev. 1445 (2012), here.  Judge Wood makes some salient observations about opinion writing in the appellate process.  Students can read and enjoy.

I will also cut and paste some discussion on the the role of the dissent -- certainly the grand dissent that stands the test of time -- from Kenji Yoshino, A Thousand Times More Fair: What Shakespeare's Plays Teach Us About Justice 205-208 (2012), in which the author develops concepts of justice presented in Shakespeare's major plays.  Key excerpts in his chapter on Hamlet:

In a 1931 essay titled “Law and Literature,” soon-to-be Supreme Court Justice Benjamin Cardozo explores both the importance of idealism and the importance of containing it. Cardozo observes that dissents tend to be more idealistic than majority opinions:  

The voice of the majority  may be that of force triumphant, content with the plaudits of the hour, and recking little of the morrow. The dissenter speaks to the future, and his voice is pitched to a key that will carry through the years. Read some of the great dissents, the opinion, for example of Judge Curtis in Dred Scott vs. Sandford, and feel after the cooling time of the better part of [a] century the glow and fire of a faith that was content to bide its hour. The prophet and the martyr do not see the hooting throng. Their eyes are fixed on the eternities.  

Cardozo observes that dissents can afford to be more idealistic because they have no immediate force in the world. The dissenter, who has already lost, can express an ideal justice for “the eternities.”