Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_08-cv-01016/USCOURTS-azd-2_08-cv-01016-7/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 26:7402 IRS: Petition to Enforce IRS Summons

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

United States of America, 

Petitioner, 

vs.

David H. Griggs, 

Respondent.

__________________________________

David H. Griggs,

Petitioner,

vs.

United States of America; Internal

Revenue Service; and Jennifer Pardue,

Revenue Officer, IRS,

Respondents.

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No. CV-08-1016–PHX-DGC

(Lead Case)

No. MC-08-0103-PHX-DGC

(Consolidated Case)

ORDER REGARDING OBJECTIONS

TO R&R

AND

RENEWED ORDER ENFORCING

SUMMONS

Pending before the Court is Respondent Griggs’s motion to dismiss the Court’s order

enforcing an IRS summons (Dkt. #27) and Magistrate Judge Mark Aspey’s Report and

Recommendation (“R&R”). Judge Aspey recommends that the Court deny Griggs’s motion.

Dkt. #75. Griggs filed an objection to the R&R (Dkt. #76) and the Government filed a

response (Dkt. #78). The Court will accept the recommendation of Judge Aspey, deny

Griggs’s motion, and set forth the further proceedings that are to occur in this case.

Case 2:08-cv-01016-DGC Document 81 Filed 11/25/09 Page 1 of 10
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1

 Citations to pages in the parties’ filings will be to the page numbers applied by the

Court’s electronic docket at the top of each page.

2

 In addition, Judge Aspey noted that Griggs expressly abandoned his Fifth

Amendment claim at the outset of the evidentiary hearing. Id. at 14. Griggs thereafter

asserted the Fifth Amendment in response to specific questions, but refused to explain the

basis for his Fifth Amendment objection when asked, and even declined Judge Aspey’s

invitation to provide the explanation in chambers to Judge Aspey alone. Id. at 8 n.2.

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I. Background.

On March 25, 2008, the Government filed a petition to enforce an Internal Revenue

Service summons issued to David Griggs. Dkt. #1, CV-08-1016. On June 2, 2008, the Court

ordered Griggs to produce documents and testimony as required by the summons. Dkt. #10.

On June 23, 2008, Griggs appeared before the IRS, declined to provide documents, and

asserted a Fifth Amendment privilege in response to all questions. Dkt. #75 at 3.1

 On

September 30, 2008, the Court ordered Griggs to show cause why he should not be held in

contempt. Dkt. #17. Griggs appeared before the Court on November 5, 2008, refused to

comply with the summons, and filed the pending motion to dismiss. Dkt. #75 at 4. The

Court referred the matter to Judge Aspey for an R&R, asking for a recommendation on

whether Griggs has a Fifth Amendment privilege to refuse to submit to the summons and

whether the IRS satisfied the “foregone conclusion” test with regard to the summonsed

documents. Id. at 9. Judge Aspey provided Griggs an opportunity to produce documents for

in camera inspection, held an evidentiary hearing, and wrote a detailed and thoroughly

research R&R. 

Griggs declined Judge Aspey’s invitation to submit documents for in camera review

so that Judge Aspey could determine whether Griggs had a valid Fifth Amendment objection.

As a result, Judge Aspey found that Griggs had failed to establish his Fifth Amendment

privilege. Id. at 14-15. Griggs does not object to this finding.2

 

Although the finding was not necessary in light of his conclusion that Griggs could

not assert a valid Fifth Amendment objection, Judge Aspey also found that the IRS did not

satisfy the “foregone conclusion” test. No objection has been made to this finding.

Case 2:08-cv-01016-DGC Document 81 Filed 11/25/09 Page 2 of 10
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3

 In the final paragraph of his objection, Griggs asserts that Judge Aspey erred by

stating that Griggs “has not met his burden of establishing a present inability to comply with

the summons.” Dkt. #76 at 4. Griggs, however, does not address Judge Aspey’s ruling or

provide any case law or analysis indicating why Judge Aspey is incorrect. The Court will

not review this generalized objection. See Tindall v. Schriro, 2006 WL 2361721, at *2

(D.Ariz. June 5, 2006) (court need not review general, non-specific objections to R&R). 

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Finally, Judge Aspey found that Griggs likely destroyed documents after receiving his

summons, a fact that weighs in favor of a finding of contempt. Id. at 23. Griggs objects to

this finding.3

II. R&R Review Standard.

Because Griggs filed a timely objection to the R&R, the Court will undertake a de

novo review of those portions of the R&R to which he made specific objections. See Fed.

R. Civ. P. 72(b); 28 U.S.C. § 636(b)(1)(C); Thomas v. Arn, 474 U.S. 140, 149 (1985); United

States v. Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir. 2003). The Court may accept, reject,

or modify the findings or recommendations made by the magistrate judge. 28 U.S.C.

§ 636(b)(1). 

III. Analysis.

Judge Aspey stated that “a finding of contempt would be appropriate notwithstanding

Mr. Griggs’ assertion that he does not now possess any documents responsive to the

summons” because, among other reasons, “Griggs has admitted that, after being served with

the summons, he destroyed some documents which were responsive to the summons.”

Dkt. #75 at 23. Griggs contends that the record does not show that he destroyed documents.

At the July 8, 2009 evidentiary hearing, however, the parties discussed Griggs’s practice of

destroying records. Griggs provided this testimony:

Q. So to the extent you had records after August 20, 2007 [the date the IRS

summons was served on Griggs] relating to warranty work you did at the end

of 2006, your practice would have been to destroy those records?

A. Yes.

Q. . . . So what I’m also asking, then, is when you got this summons at the end of

August 2007, you made no effort to identify records that were covered and

preserve them; is that correct?

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A. That’s probably correct.

Q. Do you have any reason for not doing so?

A. No. I don’t think so.

Dkt. #78 at 2. This testimony supports Judge Aspey’s conclusion that Griggs likely

destroyed records responsive to the summons. 

Griggs further argues that it would have been improper for him to discard records only

after the Court ordered him to comply with the IRS summons. Dkt. #76 at 3. This

contention is contrary to well-settled law. “An IRS summons imposes a duty to retain

possession of summoned documents pending a judicial determination of the enforceability

of the summons.” United States v. Asay, 614 F.2d 655, 660 (9th Cir. 1980). The Court will

deny Griggs’s objection to the R&R.

IV. Further Proceedings.

For purposes of further proceedings, the Court reaches several conclusions.

First, Griggs cannot assert a Fifth Amendment objection to the IRS summons for

documents. Judge Aspey correctly found that Griggs has failed to establish his right to assert

the Fifth Amendment, and Griggs has not objected to this conclusion.

Second, Judge Aspey correctly found that Griggs failed to preserve warranty

documents after receipt of the IRS summons. The extent of that failure, and whether Griggs

should be held in civil contempt for destruction of documents, must be addressed in further

proceedings.

Third, because Griggs cannot assert a valid Fifth Amendment objection to the

production of documents, the Court will order Griggs to comply with the Order Enforcing

Summons (Dkt. #10) by January 15, 2010. A copy of that Order is attached to this Order as

Exhibit A. So there is no ambiguity about Griggs’s obligation, the Order Enforcing

Summons requires Griggs to produce all documents he “possesses or controls.” Dkt. #10 at

2. Griggs therefore must make all reasonable efforts to secure the documents called for in

the Order Enforcing Summons, including obtaining the documents from banks and credit

card companies. If Griggs fails to comply with this Order, the Court will entertain a motion

Case 2:08-cv-01016-DGC Document 81 Filed 11/25/09 Page 4 of 10
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4

 The IRS asserts that this obligation includes obtaining documents from customers.

Because it is not clear that Griggs possesses or controls documents held by customers, the

Court cannot at this stage conclude that he has an obligation to obtain them. To the extent

the IRS later argues that Griggs should be held in contempt for failing to obtain documents

from customers, the Court will require the IRS to show that he possesses or controls such

documents.

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to hold him in civil contempt.

Fourth, Griggs raised for the first time before Judge Aspey a lack of possession

defense to the production of documents. To assert such a defense, Griggs must produce

credible evidence establishing his present inability to comply with the summons. United

States v. Rylander, 460 U.S. 752, 757 (1983); United States v. Rue, 819 F.2d 1488, 1494-95

(8th Cir. 1987); Bagley v. Santacroce, 800 F.2d 33, 36-37 (2d Cir. 1986). Griggs cannot

meet this burden “simply by alleging nonpossession of the summoned documents and

thereafter standing mute and asserting a Fifth Amendment privilege.” Rue, 819 F.2d at 1495

(citing Rylander, 460 U.S. at 758-61). Rather, he must actively produce evidence showing

that he has made all reasonable efforts to comply. United States v. Hayes, 722 F.2d 723, 725

(11th Cir. 1984); see Sidney v. MacDonald, 536 F. Supp. 420, 424 (D. Ariz. 1982). Those

efforts include obtaining the responsive documents from banks and credit card companies.4

IT IS ORDERED:

1. Respondent’s objection (Dkt. #76) to the R&R is denied.

2. Magistrate Judge Mark E. Aspey’s R&R (Dkt. #75) is accepted.

3. Respondent’s motion to dismiss (Dkt. #27) is denied.

4. Respondent David Griggs is ordered to comply with the Order Enforcing

Summons (Dkt. #10) by January 15, 2010. A copy of the Order Enforcing

Summons is attached to this Order as Exhibit A. Respondent must produce all

documents called for in the Order Enforcing Summons that he “possesses or

controls.” Dkt. #10 at 2. Respondent Griggs therefore must make all

reasonable efforts to secure the documents called for in the Order Enforcing

Summons, including obtaining the documents from banks and credit card

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companies. The documents shall be produced on January 15, 2010, at the

place identified in the Order Enforcing Summons.

Dated this 24th day of November, 2009.

Case 2:08-cv-01016-DGC Document 81 Filed 11/25/09 Page 6 of 10
EXHIBIT A

Case 2:08-cv-01016-DGC Document 81 Filed 11/25/09 Page 7 of 10
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Case 2:08-cv-01016-DGC Document 10 Filed 06/02/08 Page 1 of 3 

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6 UNITED STATES DISTRICT COURT 

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lO Petitioner, 

United States of America, 

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v. 

David H. Griggs, 

13 Respondent. 

DISTRICT OF ARIZONA 

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)
 

)
 

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) MC-08-00029-PHX-DGC 

)
 

)
 

ORDER ENFORCING SUMMONS 

) 

14 .. ) 

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16 Based upon the Petition filed by the United States, the pleadings with respect 

17 thereto, the appearances ofthe parties before the Court and good cause appearing, 

IT IS HEREBY ORDERED that enforcement of Petitioner's Summons issued to 18 

19 Respondent David H. Griggs is hereby granted based upon Petitioner having met the 

20 United States v. Powell, 379 U.S. 48 (1964), criteria for Summons enforcement and 

21 Respondent having failed to demonstrate that such enforcement would constitute an abuse 

22 of the Court's process or that the Summons was issued by the Internal Revenue Service 

23 for an improper purpose; and 

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Case 2:08-cv-01016-DGC Document 81 Filed 11/25/09 Page 8 of 10
Case 2:08-cv-01 016-DGC Document 10 Filed 06/02/08 Page 2 of 3 

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IT IS FURTHER ORDERED that Respondent David H. Griggs shall produce 

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documents and testimony required in the Summons within forty-five (45) days of the date 

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ofthis Order Enforcing Summons to Revenue Officer Jennifer Pardue, at the Small 

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Business/Self-Employed Division - Western Area of the Office of the Area Director of 

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the Internal Revenue Service at 40 West Baseline Road, Suite 212, MS 5102, Tempe, 

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Arizona 85283, or Respondent shall contact Revenue Officer Jennifer Pardue at (602) 

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207-8589 to arrange the time and place to produce documents and testimony required in 

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the Summons within the forty-five (45) days of the date of this Order; 

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IT IS FURTHER ORDERED that Respondent may comply within this Order by 

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providing the testimony, and all documents and records Respondent David H. Griggs 

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possesses or controls regarding income Respondent received for the years ending 

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December 31, 2001, December 31, 2002, December 31, 2005 and December 31, 2006, to 

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include but not limited to the following: 

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(1) All statements ofwages, statements for interest 

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and dividend income, employee earnings statements, and 

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records of deposit to banks accounts for the years 2001, 2002,
 

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2005 and 2006; and 

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(2) Any and all other books, records, documents, and 

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receipts regarding wages, salaries, tips, fees, commissions, 

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and any other compensation for services (including gains 

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 from dealings in property, interest, rentals, royalties and 

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 dividend income, alimony, annuities, income from life 

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 insurance policies and endowment contracts, pensions, 

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 income from discharge of indebtedness, distributive shares of 

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Case 2:08-cv-01016-DGC Document 81 Filed 11/25/09 Page 9 of 10
Case 2:08-cv-01 016-DGC Document 10 Filed 06/02/08 Page 3 of 3 

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partnership gross income, income from an estate or trust) for 

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the years 2001, 2002, 2005 and 2006. 

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IT IS FURTHER ORDERED that Respondent's non-compliance with the tenus 

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and conditions of this Order may serve as grounds for a finding of civil contempt against 

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him. 

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DATED this 30th day ofMay, 2008. 

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David G. Campbell United States District Judge 

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