Free Joint Preliminary Status Report - District Court of Federal Claims - federal

Case 1:08-cv-00169-ECH

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS

GEORGE J. GILLESPIE, III, and DAVID T. SCHIFF, as Trustees, etc., Plaintiffs, v. THE UNITED STATES, Defendant.

) ) ) ) ) No. 08-169 T ) The Honorable Emily C. Hewitt ) ) ) ) )

JOINT PRELIMINARY STATUS REPORT The parties submit the following information pursuant to section III of Appendix A to the Rules of the United States Court of Federal Claims. (a). Plaintiffs believe that the Court has jurisdiction of this action

pursuant to 28 U.S.C. § 1491. At this time, the United States does not expect to contend that the Court is without jurisdiction. (b). The parties are aware of no other case with which this case ought to be

consolidated. (c). The parties believe that the legal issues presented are susceptible to

disposition on cross-motions for summary judgment, as set out below. In any event, the parties ask that the Court determine only the question of liability, and thereafter permit the parties a reasonable period of time within which to perform and agree upon any necessary recomputation of tax liability and interest due, with

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a view to the parties' submitting an agreed stipulation as to the amount of the judgment. (d). The parties do not believe that this case should be suspended pending

consideration of any other case. (e). (f). This is a tax refund action. The parties are unaware of any other party the joinder of which would

be necessary or proper. (g). Both parties anticipate the filing of cross-motions for summary

judgment to resolve this action. The parties anticipate that they will submit a joint statement of uncontroverted facts for this purpose. The parties also intend to engage in settlement discussions and propose that 90 days be allotted for such discussions prior to the pretrial discovery period. If the Court agrees with this proposal, at the end of the 90 day period, the parties will propose a schedule for pretrial discovery and further proceedings. (h). This is a tax refund action by plaintiffs as trustees of a trust created by

John Oakes Marriott under an agreement dated August 19, 1960 (the "Trust"). The issue in this case is whether the Trust has overpaid its tax liability. The parties have identified the following subsidiary legal issues: 1. Whether the Trust should be treated from its inception as a

grantor trust under Section 677(a)(2) of the Internal Revenue Code, rather than as a "complex trust" under Sections 661 and 662 of the Internal Revenue Code.

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2.

Whether any amount which plaintiff is found to be entitled to

recover must be reduced and offset by the corresponding tax, interest, and penalties owed by the settlor or beneficiary of the trust pursuant to the doctrine of equitable recoupment; 3. Whether, as a consequence of the passage of time, the instant

suit is barred by laches. (i). The parties anticipate commencing settlement discussions

immediately, and request below a period of 90 days to pursue that course. Counsel for the parties believe that settlement is sufficiently likely to warrant such discussions. (j). As set out above, if the parties are unable to resolve the case through

settlement, they anticipate the filing of cross-motions for summary judgment. The parties do not request an expedited schedule. If the case is not resolved through the resolution of dispositive motions, or through the settlement process, the parties anticipate proceeding to trial. (k). There are no special issues regarding electronic case management of

which the parties are aware. (l). The parties do not expect to rely upon expert witnesses. Initial

disclosures will be completed on or before October 3, 2008. The parties propose to pursue settlement before determining a schedule for discovery and the filing of dispositive motions. Accordingly, they propose that they be required to file a joint status report, no later than December 3, 2008, setting out the status of their

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settlement discussions, and proposing a schedule for discovery and further proceedings. Respectfully submitted, s/ Rowan D. Wilson ROWAN D. WILSON Attorney of Record Cravath, Swaine & Moore LLP Worldwide Plaza 825 Eighth Avenue New York, New York 10019 Phone: (212) 474-1348 Fax: (212) 474-3700 Attorney for Plaintiffs

s/ W. C. Rapp W. C. RAPP Attorney of Record United States Department of Justice Tax Division Court of Federal Claims Section Post Office Box 26 Ben Franklin Post Office Washington, D.C. 20044 Phone: (202) 307-0503 Fax: (202) 514-9440 [email protected] NATHAN J. HOCHMAN Assistant Attorney General STEVEN I. FRAHM Acting Chief, Court of Federal Claims Section MARY M. ABATE Assistant Chief September 4, 2008 s/ Mary M. Abate Of Counsel Attorneys for Defendant
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