Free Motion for Issuance of Letters Rogatory - District Court of Federal Claims - federal

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EXHIBIT B

2375190.1

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EXHIBIT B DOCUMENTS TO BE PRODUCED BY BAYERISCHE LANDESBANK A.G. DEFINITIONS & INSTRUCTIONS A. "Document," "record" and "material" include any written, printed, typed, electronic or graphic matter of any kind or nature. Any draft or non-identical copy constitutes a separate document for purposes of these requests. The terms shall be construed to include, but shall not be limited to, correspondence, electronic mail, notes, notations, contracts, brochures, agreements, deeds, leases, letters, memoranda, checks, bank statements, reports, analyses, projections, studies, records, corporate minutes, financial statements, financial records, accounting or audit workpapers (including permanent workpapers), spreadsheets, transcripts, recordings, and all other types of written or documentary materials. B. Any copy of a document that varies in any way from the original or from any other copy of the document, whether by reason of handwritten or other notation or any omission, shall constitute a separate document and must be produced. Each document is to be produced in its entirety, without abbreviation or expurgation, and the person who made the notation identified. C. If any documents are withheld under a claim of privilege, furnish a list identifying each document for which a privilege is claimed, together with the following information and sufficient details so as to permit a court to adjudicate the validity of the claim of privilege: date, sender, recipient, type (e.g., letter, memorandum, telegram, chart, photograph, etc.), subject matter of the document, the basis on which a privilege is claimed, and the paragraph or paragraphs of this request to which the document responds. D. If any document that would have been responsive to these requests no longer exists, please state the following for each document: the date of destruction, the reason for destruction, and the person(s) responsible for the decision to destroy the document(s) and for the actual destruction of the documents. E. Responses to these requests should be made in a manner consistent with Fed. R. Evid. 902(12), Certified Foreign Records of Regularly Conducted Activity. F. The term "Con Ed" shall refer to Consolidated Edison Company of New York, Inc. & Subsidiaries, and affiliated companies, including, but not limited to, Consolidated Edison Development, Inc., Consolidated Edison Leasing, Inc., and Consolidated Edison, Inc.

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G. The term "Banc One" shall refer to Banc One Leasing Corp. its related affiliates, subsidiaries, successors, and assigns, including, but not limited to, and any person, officer, director, accountant, lawyer, agent, or entity acting on behalf of any of the foregoing organizations. H. The term "EZH" shall refer to N.V. Electriciteitsbedrifj Zuid-Holland, its related affiliates, subsidiaries, successors, and assigns, including, but not limited to, Preussen Elektra A.G. and E.ON Benelux Generation N.V., and any person, officer, director, accountant, lawyer, agent, or entity acting on behalf of any of the foregoing organizations. I. The term "E.On Energie" shall refer to E.On Energie A.G., its related affiliates, subsidiaries, successors, predecessors and assigns, and any person, officer, director, accountant, lawyer, agent, or entity acting on behalf of any of the foregoing organizations. J. The term "RoCa3" shall refer to the gas fired CHP facility located in the Netherlands on the border between Rotterdam and Capelle aan den IJessel, constituting the third unit alongside two previously built units, which was owned by EZH on or about December 15, 1997. K. The term "Lease Transaction" shall refer to the series of transactions entered into on December 15, 1997 between EZH and Con Ed, through a trust, wherein EZH purportedly leased an approximately 47.468% undivided interest in the RoCa3 facility to Con Ed for 44 years, and Con Ed then purported to immediately sublease that same 47.468% interest in the RoCa3 facility back to EZH for a period of 20 years, with various options arising at the end of that 20 year term, as further described in paragraphs 61-77, inclusive of the complaint attached hereto as Exhibit B-1. L. The term "Lease Transaction Participants" refers to the following entities: ABN AMRO Bank N.V.; Hollandsche Bank-Unie N.V.; EZH; Con Ed; Credit Suisse; Bayerische Landesbank; ABB Leasing GmbH; Wilmington Trust Co.; and any and all affiliated businesses, successors, assigns, predecessor or successor businesses, and any person, officer, director, accountant, lawyer, agent, or entity acting on behalf of any of the foregoing organizations. M. The term "Capstar" refers to Capstar Partners L.L.C., its related affiliates, subsidiaries, successors, and assigns, and any person, officer, director, member, accountant, lawyer, agent, or entity acting on behalf of any of the foregoing organizations. N. The term "Cornerstone" refers to Cornerstone Financial Advisors L.P., its related affiliates, subsidiaries, successors, and assigns, and any person, officer, partner, accountant, lawyer, agent, or entity acting on behalf of any of the foregoing organizations.

Exhibit B

2

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DOCUMENTS TO BE PRODUCED THE LEASE TRANSACTION 1. Transaction. The documents in the files of Bayerische Landesbank that discuss the Lease

2. The documents in the files of Bayerische Landesbank that discuss or pertain to its solicitation as a potential participant in the Lease Transaction. 3. The documents in the files of Bayerische Landesbank that discuss Bayerische Landesbank's decision to participate in the Lease Transaction. 4. The documents in the files of Bayersich Landesbank that discuss or pertain to Irrevocable Standby Letter of Credit No. 151221116, including any amendments thereto. 5. The documents in the files of Bayerische Landesbank pertaining to the negotiation of or the issuance of Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997, identified at Bates Nos. US06193-06204, attached hereto as Exhibit B-2. 6. The documents in the files of Bayerische Landesbank that contain the credit and/or risk of default analyses made in conjunction with the decision to participate in the Lease Transaction and/or issue Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997. 7. The documents in the files of Bayerische Landesbank that describe or discuss the lease options the Lease Transaction provides to Con Ed and/or EZH, including documents that address the feasibility and/or likelihood of exercise of those options. 8. The documents in the files of Bayerische Landesbank evidencing the transfer of any funds by or to any of the Lease Transaction Participants in connection with the Lease Transaction or Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997. 9. The documents in the files of Bayerische Landesbank evidencing the risk of default in the Lease Transaction.

Exhibit B

3

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10. The documents in the files of Bayerische Landesbank discussing a default or missed loan repayment by either Con Ed and/or EZH. COMMUNICATIONS 11. The letters, memoranda, notes, e-mails, and other written communication in the files of Bayerische Landesbank between Bayerische Landesbank and any of the Lease Transaction Participants (or their affiliates, assigns, or successors in interest) in connection with the Lease Transaction and/or Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997. 12. The letters, memoranda, notes, e-mails, and other written communication in the files of Bayerische Landesbank between Bayerische Landesbank and Capstar in connection with the Lease Transaction and/or Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997. 13. The letters, memoranda, notes, e-mails, and other written communication in the files of Bayerische Landesbank between Bayerische Landesbank and Cornerstone in connection with the Lease Transaction and/or Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997. 14. The letters, memoranda, notes, e-mails, and other written communication in the files of Bayerische Landesbank between Bayerische Landesbank and Banc One in connection with the Lease Transaction and/or Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997. 15. The letters, memoranda, notes, e-mails, and other written communication in the files of Bayerische Landesbank between Bayerische Landesbank and Davis Polk in connection with the Lease Transaction and/or Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997. 16. The letters, memoranda, notes, e-mails, and other written communication in the files of Bayerische Landesbank exchanged by and/or between Bayerische Landesbank and EZH, E.On. Benelux B.V., E.On Energie or Con Ed, or any representatives thereof, with respect to the Lease Transaction and/or Irrevocable Standby Letter of Credit No. 151221116 dated December 15, 1997, letters of credit pertaining to the Lease Transaction and the impact the acquisition of EZH by Preussen Elektra AG would have on the Lease Transaction or the letter of credit.

Exhibit B

4

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SIMILAR TRANSACTIONS 17. The documents in the files of Bayerische Landesbank that discuss any other transaction substantially similar to the Lease Transaction and/or the transaction described in Revenue Ruling 2002-69, 2002-2 C.B. 760 (copy attached hereto as Exhibit B-3), from 1996 through 2001, including the documents discussing the solicitation of Bayerische Landesbank as a potential participant in such a transaction and the documents reflecting Bayerische Landesbank's consideration of such transactions and decision to participate in such transactions. REGULATORY COMMUNICATIONS 18. The correspondence, communication, and reporting made to governmental regulatory authorities by Bayerische Landesbank or on Bayerische Landesbank's behalf in the files of Bayerische Landesbank that pertain to or refer to the Lease Transaction and/or the financing of the Lease Transaction.

Exhibit B

5

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EXHIBIT B-1

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IN THE UNITED ST A TES COURT OF FEDERAL CLAIMS
)

CONSOLIDATED EDISON COMPANY OF NEW YORK, INC. & SUBSIDIARIES,

FILED APR 1 9 ø

)

)
)

Plaintiff,
v.

) ) )
) ) ) ) ) )

t06-305 T
..' No.

THE UNITED STATES,

Defendant.

COMPLAINT
Plaintiff, Consolidated Edison Company of New York, Inc. & Subsidiaries, brings this
action for a refund of federal taxes paid in connection with the Internal Revenue Service's

proposed adjustments to its federal tax return for the taxable year ending December 31, 1997.
The adjustments are related to Plaintiffs investment in an electric generation facility located

outside Rotterdam, The Netherlands. In support of its refund claim, Plaintiff alleges as follows:

JURSDICTION AND SUMRY OF ACTION
1. Plaintiff, Consolidated Edison Company of New York, Inc. & Subsidiares ("Con

Edison NY"), brings this refund

action, founded upon the Internal Revenue Code of 1986, for the

recovery of federal income tax paid by Plaintiff for the taxable year ended December 31, 1997
("the 1997 taxable year").

2. Defendant is the United States of America.
3. This Court has jursdiction by reason of 28 U.S.C. §§ 1346(a)(1) and 1491(a)(I)
and 26 U.S.c. § 7422.

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4. On or before September 9, 1998, Con Edison NY filed a timely federal
consolidated income tax return for the 1997 taxable year with the Internal Revenue Service

("IRS") and timely paid income taxes in the amount of $291,003,408.

5. Con Edison NY's name, address, and identification number appearng on the
1997 tax return are: Consolidated Edison Company of New York, Inc. & Subsidiares; 4 Irving
Place, Room 615-S, New York, New York, 10003; and 13-5009340, respectively.
6. During the 1997 taxable year, Con Edison NY, through its subsidiares, made an

investment i~ an electric generation plant in The Netherlands. The plant is generally known as
"RoCa3" and is owned by N.V. Electriciteitsbedijf Zuid-Holland ("South Holland Electric").

This transaction is hereinafter referred to as the "RoCa3 Investment."
7. On its 1997 tax return, Con Edison NY reported rental income with respect to the

RoCa3 Investment and deducted rental expense, amortization of expenses, and jnterest expense

relating to the property and indebtedness incurred in the RoCa3 Investment, for a net loss of
$937,331.
8.

The IRS, during a routine audit of Con Edison NY's tax return for the 1997

taxable year, disputed Con Edison NY's tax treatment of the RoCa3 Investment.
9. On or about September 15,2005, the IRS issued a Notice of Proposed Adjustment

to Con Edison NY, proposing additional federal income of $937,331 for the 1997 taxable year
with respect to the RoCa3 Investment.

10. The IRS's proposed adjustments resulted in a tax increase of $328,066, increasing
Con Edison NY's federal income tax liability for the 1997 taxable year from $291,003,408 to
$291,331,474.

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i 1. On or about November 3, 2005, Con Edison NY paid the proposed tax deficiency

of $328,066 to the IRS.
12. On or about December 2, 2005, Con Edison NY filed a Form 1040X (Amended

U.S. Corporation Income Tax Return) with the IRS requesting a refund of erroneously paid
federal income taxes for the 1997 taxable year in the amount of $328,066. The requested refund
was solely attributable to Con Edison NY's payment of the proposed tax deficiency referrd to in

paragraphs 10 and 1 I above. A true and complete copy of this claim for refund is attached as
Exhibit A.
13. By a notice of disallowance dated March 15, 2005, the IRS disallowed Con

Edison NY's claim for refund. A true and complete copy of this notice of disallowance is
attached as Exhibit B.
14. The IRS's disallowance of Con Edison NY's claim for refund was erroneous.

15. Con Edison NY requests a refund of its overpayment of $328,066 of federal tax

for the i 997 taxable year, plus interest and allowable costs.

16. No action on the claim for refund aiiached as Exhibit A has been taken by
Congress or any agency of the United States or in any judicial proceeding, including any in the
Tax Court of the United States.
17. Con Edison NY has timely fied this Complaint for a refund of federal taxes paid

within two years of the date of the notice of disallowance as required under 26 U.S.C. § 6532(a).
18. Con Edison NY is the sole owner of the claim included in Exhibit A and asserted

herein, and has made no assignment thereof.

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