14 2 T.C. No . 21

UNITED STAT ES TAX COURT

W HISTLEBLOW ER 11 33 2- 13 W , Pet it io ne r v. COMM ISSI ONER OF INTERNAL REVENUE, Resp on de nt

Doc ke t No . 11 33 2- 13 W . Fi le d J un e 4 , 20 14 . Whi st le bl owe r W

rep orte d atax frau d s ch em e, in vo lv in g W’ s em pl oyer an d re la te d e nt it ie s, t o the Gov ern m en t. W pr ov id edth e Gov ern m en t wi th in fo rm at io n re ga rd in g the tax frau d s ch em e fro m Ju ne 20 06 th ro ug h the fal l o f 20 09 . W ’s in fo rm at io n fo rm edth e b as is of th e Gov ern m en t’s ac ti on ag ai ns t the tar ge t t axpa y ers . W fil eda Fo rm

21 1, Ap pl ic at io n fo r AwardforOrig in al In fo rm at io n, i n 2 00 8 andsubm itte d t o R do cum en tary

ev id en ce rel at edto W ’s in vo lv em en t i n the Gov ern m en t’s i nv es ti ga ti on . W res ub m it te d F orm

21 1 i n 2 01 1 s eek in g an awardun de r I.R.C. s ec. 76 23 (b ). Sho rtl y

th erea fte r, th e Gov ern m en t s et tl edwith o ne of the targ ettax pa y ers an d re co ve redm or e th an$3 0 m il li on do ll ars intax es , pe na lt ie s an d i nt eres t. R g ran te d W a di sc ret io na ry award de te rm in at io n u nd er I.R.C . sec . 76 23 (a) andde ni edW ’s reque stfor anawardun de r I.R.C. s ec. 7 62 3( b) .-2 - W fil edth e p et it io n s eek in g re vi ew of R’s awardde te rm in at io n. R fi le d am ot io n t o d is mis s fo r la ckof juris di ct io n. R ar gu es th atth is Co urt l ack s juris di ct io n t o re vi ew R’s awardde te rm in at io n b ecau se R pr oc eed edag ai ns t the tar ge t t ax pa y ers us in g i nf orm at io n W pro vi de d be fo re the effe ct iv e d at e o f I.R.C. s ec. 7 62 3( b) , Dec. 20 , 20 06 . W op po se s R ’s m ot io n o n the gro un ds th atW pro vi de d i nf

orm at io n t o th e Gov ern m en t b ot h b efo re an d a fte r th e eff ect iv e d at e o f I.R.C. s ec. 76 23 (b ). Held : Th e Co urt h as juri sd ic ti on to rev ie w R’s whi st le bl owe r cl ai m awardde te rm in at io ns wher e W ha s al le ge d tha t W pro vi de d in fo rm at io n t o R

be fo re an d a fte r th e eff

ect iv e d at e o f I.R.C. s ec. 76 23 (b ). Held , furth er, W sati sf

ie d W’ s p le ad in g b ur de n b y all eg in g fact s tha t R p ro ceed edwith an a ct io n a ga in stth e ta rg ettax pa y ers us in g i nf orm at io n b ro ug htto R’s att en ti on by W bo th be fo re an d a fte r th e eff ect iv e d at e o f I.R.C. s ec. 7 62 3( b) , Dec. 20 , 20 06 . Held , furth er, R’s m ot io n t o d is m is s wi ll be de ni ed . Seal ed , forpe ti ti on er. Seal ed , forres po nd en t.-3 - OPINION KROUPA, Ju dg e: Thi s ca se is be fo re the Co urt o n re sp on de nt ’s m ot io n t o 1 di sm is s fo r la ckof juris di ct io n. We dec id e fo r th e fi rs t t im e whe th er the Co urt h as juri sd ic ti on to rev ie w res po nd en t’s wh is tl eb lo wer cl ai m awardde te rm in at io ns whe re the whi st le bl owe r pr ov id edin fo rm at io n b ot h b efo re an d a fte r th e en act m en t of th e Tax Rel ie f an d Hea lth C are Actof 2 00 6 (TRHCA) , Pub . L. No. 10 9- 43 2, 2 di v. A, se c. 40 6, 1 20 Stat. at29 58 , effec ti ve Decem be r 20 , 20 06 . W e h ol d tha t we do . 3 Bac kg ro un d The fol lo win g b ack gr ou ndis dra wn fr om th e p et it io n andres po nd en t’s m ot io n t o d is m is s fo r la ck of s ub ject m at te r juri sd ic ti on an d re sp on se s fi le d b y bo th parti es . W e n ot e th atth e b ack gr ou ndis st at edso le ly for p ur po se s o f ru li ng on th e p en di ng m ot io n t o d is m is s an d i s n ota fi nd in g o f fac ts . Thi s C ou rt p rev io us ly gran te d the whi st le bl owe r’s m ot io n t o s eal th e rec or d 1 inth is cas e an d m ot io n t o p ro ceedan on y m ou sl y . Tax Rel ie f an d Hea lth C are Actof 2 00 6, Pub. L. No. 1 09 -4 32 , di v. A, se c. 2 40 6, 1 20 Sta t. at29 58 , cod ifi edat s ec. 7 62 3( b) . All sec ti on refe ren ces are t o the Int ern al Rev enue Co de ineffe ctat a ll 3 rel ev an t t im es , andall Ru le refe ren ces are t o the Tax C ou rt Rul es of P ract ic e an d Pro cedur e, un le ss othe rwis e in di cat ed . All a m ou nt s ar e ro un de d t o the ne ares t do ll ar.-4 -

Pet it io ne r is a whi st le bl owe r th atrep orte d atax frau d s ch em e to th e Gov ern m en t. Durin g the whi st le bl owe r’s em pl oym en t, the whi st le bl owe r le arn ed of a ta x s tru ctur e in vo lv in g the whi st le bl owe r’s em pl oyer an d s ev eral rel at ed en ti ti es an d s ub si di ary co m pa ni es (targ et s) . W

he n the whi st le bl owe r rai se d co nc ern s o ve r th e ta x s tru ctur e to th e whi st le bl owe r’s em pl oyer, th e whi st le bl owe r’s em

pl oyer us edph y si cal for ce an d arm edm ento in ti m id at e th e whi st le bl owe r an d p rev en t d is cl os ur e. The wh is tl eb lo wer was subs eque nt ly fired . In20 05 th e whi st le bl owe r at te m pt edto rep ort the tax sch em e to th e Gov ern m en t. The whi st le bl owe r’s effo rts were m etwith n o re sp on se . The wh is tl eb lo wer ev en tu al ly reach edGov ern m en t o ffi ci al s i nt eres te d i n the whi st le bl owe r’s in fo rm at io n. InJune 20 06 th e whi st le bl owe r m etin fo rm al ly w ith Dep art m en t o f Ju st ic e (DOJ) rep res en ta ti ve s i n Wash in gt on , D.C. rega rd in g the tax sch em e. The whi st le bl owe r pr ov id edth e DOJ re pr es en ta ti ve s wi th ge ne ric in fo rm at io n reg ard in g the tar ge ts an d the tax sch em e atth is fir stm eet in g. Th e whi st le bl owe r m etwith In te rn al Rev enue Serv ic e (IR S) an d the DOJ rep res en ta ti ve s s ev eral m or e ti m es inth e su m

m er an d fa ll of 2 00 6. Ateach m eet in g the whi st le bl owe r pr ov id ed ad di ti on al do cu m en ts an d d et ai ls reg ard in g the tax sch em e. The whi st le bl owe r co nt inue d t o p ro vi de ad di ti on al in fo rm at io n re ga rd in g th e ta rg et s’ act iv it ie s an d was inreg ul ar co nt actwith the IRS an d the DOJ-5 -

rep res en ta ti ve s af

te r Decem

be r 20 , 20 06 . On m

ul ti pl e o ccas io ns , th e IRS an d the DOJ rep res en ta ti ve s as ke d the whi st le bl owe r fo r in fo rm at io n, af te r Decem

be r 20 06 , rel at edto parti cu lar are as of i nqui ry an d d et ai ls reg ard in g tran sa ct io ns an d th e ta rg et s. As th e whi st le bl owe r le arn edad di ti on al in fo rm at io n re ga rd in g the targ et s’ act io ns , th e whi st le bl owe r rep orte d tha t i nf orm at io n t o the IRS an d the DOJ rep res en ta ti ve s. Th e whi st le bl owe r pr ov id edin fo rm at io n t o the IRS an d the DOJ rep res en ta ti ve s co nt in ua ll y un ti l the fal l o f 20 09 . Not ab ly, th e whi st le bl owe r’s as si st an ce i n thi s i nv es ti ga ti onjeop ard iz edth e sa fety of the whi st le bl owe r an d the whi st le bl owe r’s fam il y . As di sc us se d i n d et ai l i n Whi st le bl owe r 11 33 2- 13 W v. Co m m is si on er, T.C. Mem o. 2 01 4- 92 , th e whi st le bl owe r rec ei ve d s ev eral th reat s o f ph y si cal harm fro m th e ta rg et s. The whi st le bl owe r fi le d aFo rm 21 1, Ap pl ic at io n fo r AwardforOrig in al In fo rm at io n i n 2 00 8 andsubm it te d t o the IRS Whi st le bl owe r Offi ce (Whis tl eb lo wer Offi ce) d oc um en tary ev id en ce re late d t o the tar ge ts ’ act io ns th at th e whi st le bl owe r ha d p rev io us ly dis cl os ed . Sub se qu en tl y , th e whi st le bl owe r res ub m it te d F orm

21 1 i n 2 01 1 s eek in g an awardun de r se ct io n 7 62 3( b) . Sho rtl y th erea fte r, th e Gov ern m en t en te redin to a Non -Pro se cu ti on Agre em en t wi thon e o f th e ta rg et s tha t l edto th e Gov ern m en t re co ve rin g m or e th an$3 0 m il li on intax es , pe na lt ie s an d i nt eres t. The Whi st le bl owe r Offi ce g ran te d the whi st le bl owe r a-6 -

di sc ret io na ry

awardde te rm in at io n u nd er s ect io n 7 62 3( a) an d d en ie d the whi st le bl owe r’s reque stfor anawardun de r se ct io n 7 62 3( b) . The whi st le bl owe r ti m el y fil edth e p et it io n s eek in g re vi ew of res po nd en t’s awardde te rm in at io n. Re sp on de ntfil eda m ot io n t o d is m is s fo r la ckof juris di ct io n on th e g ro un d tha t re sp on de nt ’s awardde te rm in at io n i s n otsubjec t t o ju di ci al rev ie w. Resp on de ntarg ue s tha t thi s C ou rt l ack s juris di ct io n t o re vi ew res po nd en t’s awar d d et erm in at io n b ecau se he pro ceed edag ai ns t the tar ge ts us in g in fo rm at io n the whi st le bl owe r pr ov id edbe fo re the effe ct iv e d at e o f se ct io n 76 23 (b ), Decem

be r 20 , 20 06 . The wh is tl eb lo wer o bjec te d t o the m ot io n, 4 5 as se rti ng th atth e whi st le bl owe r is en ti tl edto jud ic ia l re vi ew of res po nd en t’s awardde te rm in at io n b ecau se th e whi st le bl owe r pr ov id edin fo rm at io n b ot h b efo re an d a fte r th e eff

ect iv e d at e o f se ct io n 7 62 3( b) . W e ag ree wi th th e whi st le bl owe r. W e le av e fo r an othe r da y whet he r th e whi st le bl owe r is en ti tl edto a larg er awar d.

As d is cu ss edin fra, s ec. 7 62 3( b) (4 ) fo r th e fi rs t t im e g ran te d thi s C ourt 4 juri sd ic ti on to he ar a wh is tl eb lo wer’s p et it io n fo r rev ie w of the Co m m is si on er’s awardde te rm in at io n. The am en dm en ts en act in g s ec. 7 62 3( b) ap pl y to in fo rm at io n p ro vi de d o n o r 5 aft er Dece m

be r 20 , 20 06 .-7 - Dis cu ss io n Thi s ca se pre se nt s anis su e o f fi rs t i m pr es si on . W e d eci de forth e fi rs t t im e whe th er the Co urt h as juri sd ic ti on to rev ie w res po nd en t’s wh is tl eb lo wer cl ai m awardde te rm in at io n wh ere the cla im is ba se d o n i nf

orm at io n the whi st le bl owe r pr ov id edbo th be fo re an d a fte r th e en act m en t o f TRHCA se c. 40 6, 1 20 Sta t. at 29 58 . 6 I. Overvi ew of

th e Co urt’s Jur is di ct io n andth e Whis tl eb lo wer Pro gr am W e b eg inwith the Tax C ou rt’s juris di ct io n. Th e TaxCo urt i s a c ou rt o f li mit edjuri sd ic ti on an d m ay ex erci se juri sd ic ti on on ly to the ex te ntauth or iz edby Co ng res s. Jud ge v. Co m m is si on er, 8 8 T.C. 1 17 5, 1 18 0- 11 81 (19 87 ); Na fte l v . Co m m is si on er, 8 5 T.C. 5 27 , 52 9 (1 98 5) . The Tax Co urt i s wi th ou t au th or ity to en larg e upo n tha t s ta tu to ry grant . See Ph il li ps Petro le um Co . v. Co m

m is si on er, 9 2 T.C. 88 5, 8 88 (19 89 ). W e n ev erthe le ss ha ve juri sd ic ti on to de te rm in e whe th er we ha ve juri sd ic ti on . Ham

br ic k v . Comm is si on er, 1 18 T.C. 34 8 (2 00 2) ; Pyo v . Co m m is si on er, 8 3 T.C. 6 26 , 63 2 (1 98 4) ; Kl ug er v . Comm is si on er, 8 3 T.C. 3 09 , 31 4 (1 98 4) . OurRu le s ar e si le ntas t o d eci di ng a m ot io n t o d is m is s fo r la ckof s ub ject m at te r juri sd ic ti on . Thu s, we l oo k t o the Fed eral Ru le s o f Ci vi l Pr oc edur e. See Co di fie d, i n p art , at s ec. 7 62 3( b) . 6-8 -

Ru le (1) (b ); Es ta te of M il le r v. C omm is si on er, T.C. Mem o. 1 99 4- 25 . Whe n de ci di ng a m ot io n t o d is m is s b as edonlac k o f subjec t m at te r juri sd ic ti on , a co urt m us t co ns tru e th e und is pu te d a ll eg at io ns of the co m pl ai ntina m an ne r fav or ab le to th e p la in ti ff. See Da co st a v . Uni te d S ta te s, 8 2 F ed . Cl. 5 49 , 55 2 (2 00 8) . Whe re juri sd ic ti on tu rn s o n c on te st edfact s, al le ga ti on s i n the pe ti ti on are g en eral ly tak en as tru e fo r pu rp os es of d eci di ng a m ot io n t o d is m is s fo r la ckof juris di ct io n. Se e, e.g ., O’ Bri env. Co m

m is si on er, 4 0 B .T.A. 280 (19 39 ). The i ss ue is whet he r th e cl ai m an t i s en ti tl edto off er ev id en ce t o s up po rt the cla im s, n otwhet he r th e cl ai m an t wi ll ul ti m at el y

pre va il onth e m eri ts . See Sch eu er v . Rho de s, 4 16 U.S. 23 2, 2 36 (19 74 ); s ee al so Reynol ds v. Arm y an d Ai r Fo rce Ex ch . Serv ., 84 6 F .2d 74 6, 7 47 (Fed . Cir . 19 88 ). W e tu rnno w to anov erv ie w of o urjuri sd ic ti on reg ard in g wh is tl eb lo wer cl ai m s. The Secr et ary ha s l on g h adth e d is cret io n t o p ay award s t o p ers on s pr ov id in g i nf

orm at io n tha t ai ds in(1) de te ct in g u nd erp aym en ts of t ax an d (2 ) de te ct in g andbri ng in g t o tria l an d p un is hm en t p ers on s g ui lty of v io la ti ng th e in te rn al rev enue laws . Sec. 7 62 3( a). The di sc ret io na ry whi st le bl owe r award s ha ve be enarb itrary andin co ns is te nt , ho wev er, b ecau se of alac k o f st an da rd iz ed pr oc edur es an d l im it edm an ag eri al ov ers ig ht . See Trea su ry Ins pe ct orGene ral for Tax Adm in is tra ti on Rep ort 2 00 6- 30 -0 92 , The In fo rm an ts ’ Rewar ds Pro gr am-9 -

Need s M or e Cen tra li zedMan ag em en t Ov ers ig ht(June 20 06 ). It t oo k an a ve rag e of sev eny ears fora di sc ret io na ry awardto be pa idan d an a ve rag e o f si x m on th s fo r a cl ai m

to be reject ed . Id. at8-9 . Mor eo ve r, m os t re jecte d c la im s d idno t pr ov id e th e rat io na le forth e rev ie wer’s d eci si on be cau se of c on cern s ab ou t di sc lo si ng co nf

id en ti al return i nf

orm at io n t o the whi st le bl owe r. Id. at7. Co ng res s en act edTRHCA in20 06 to ad dr es s p erce iv edpro bl em s wi th th e di sc ret io na ry

awardreg im e. TRHCA se c. 40 6( a), 1 20 Stat. at29 58 , am en de d se ct io n 7 62 3 t o re qu ire th e Sec ret ary to pay no nd is cret io nary

whi st le bl owe r award s u nd er ce rta incir cu m st an ces an d t o p ro vi de th is Co urt wi th juri sd ic ti on to rev ie w su chawardde te rm in at io ns . A whis tl eb lo wer i s n ow en ti tl edto a m in im um no nd is cret io na ry

awardof 1 5% o f th e co ll ect edpro ceed s i f th e Co m m is si on er pr oc eed s wi th adm in is tra ti ve or ju di ci al act io n u si ng in fo rm at io n p ro vi de d i n a whi st le bl owe r cl ai m . Sec. 7 62 3( b) (1 ). 7

The awardis reduc edincert ai n c irc um st an ces . For e xa m pl e, th e awardis 7 reduc edwher e th e whi st le bl owe r pl an ne d o r in it ia te d the act io ns th atledto th e un de rp aym en t o f ta x. Se c. 76 23 (b )(2 ) an d (3 ). Furth erm or e, anawardis av ai labl e on ly if th e in di vi du al tax pa y er h adgro ss in co m e ex ceed in g $ 20 0,0 00 foran y y ear atis su e an d i f th e am ou ntindi sp ut e (i nc lu di ng tax , pen al ti es , add it io ns to tax an d ad di ti on al am ou nt s) ex ceed s $ 2 m il li on . TRHCA sec . 40 6( a)(1 ), 12 0 S ta t. at29 58 .-1 0-

TRHCA al so di rect edth e Sec ret ary to is su e g ui da nc e fo r th e o pe rat io n o f a Whi st le bl owe r Offi ce adm in is te redby the IRS. TRHCA sec . 40 6( b) (1 ), 12 0 S ta t. 8 at29 59 . The Whis tl eb lo wer Offi ce i s re sp on si bl e fo r rev ie win g s ub m itte d whi st le bl owe r cl ai m s o r as si gn in g the m to th e ap pr op ria te IRS o ffi ce fo r rev ie w. Id . sec . 40 6( b) (1 )(B) , 12 0 S ta t. at29 60 . The Whis tl eb lo wer Offi ce i s au th or iz edto se ekad di ti on al ass is tanc e fro m th e whi st le bl owe r if

ne ces sary . Id. s ec. 40 6( b) (1 )(C) , (2) . The Co m m is si on er re le as edgu id an ce t o t ax pay ers onfil in g no nd is cret io na ry

whi st le bl owe r awardcla im s i n e arl y 20 08 . See No ti ce 2 00 8- 4, 20 08 -1 C.B. 2 53 . Whi st le bl owe rs see ki ng anawardm us t fu ll y co m pl et e an d subm ita Fo rm

21 1. Id . sec . 3.0 2, 2 00 8- 1 C .B. at 2 54 . The Whis tl eb lo wer Offi ce wil l ac kn owl ed ge rece ip t o f th e cl ai m inwrit in g. Id . sec . 3.0 5, 2 00 8- 1 C .B. at 2 55 . The Whi st le bl owe r Offi ce wi ll sen d c orres po nd en ce t o the whi st le bl owe r on ce a de te rm in at io n re ga rd in g the cla im ha s b eenm ad e. Id . sec . 3.1 1, 2 00 8- 1 C .B. at 25 6. Whis tl eb lo wer Offi ce d et erm in at io ns reg ard in g award s m ay be ap pe al edto th is Co urt wi th in30 day s fr om th e is su an ce o f th e n on di sc ret io na ry award de te rm in at io n. Id .; s ee al so sec . 76 23 (b )(4 ). Award s wi ll no t b e p ai d, h owe ve r, The 20 06 leg is lati on als o re qu ire s the Secr et ary to pro vi de anan nu al rep ort 8 to Co ng res s o n wh is tl eb lo wer cl ai m s fi le d andaward s i ss ue d und er s ec. 7 62 3. TRHCA se c. 40 6( c), 1 20 Sta t. at29 60 .-1 1-

un ti l the re i s a d et erm in at io n o f th e ta x l iabi li ty andth e am ou nt s o wedare co ll ect ed . Not ic e 2 00 8- 4, s ec. 3 .08 , 20 08 -1 C.B. at25 5. Th e Co m m is si on er al so is su edpro cedur al gu id an ce o n h ow wh is tl eb lo wer cl ai m s wi ll be pro ces se d. Se e In te rn al Rev enue Man ua l (I RM) pt . 25 .2.2 (Dec. 3 0, 2 00 8) . In g en eral , 9 whi st le bl owe r cl ai m s wi ll be de ni edwher e th e in fo rm at io n p ro vi de d d oe s n ot : (a ) id en ti fy a Fed eral tax is su e upo n wh ic h the IRS wi ll act ; (b ) res ul t i n the de te ct io n of anun de rp aym en t o f ta xe s; or ( c) re su ltinth e co ll ect io n o f pr oc eed s. See id . pt . 25 .2.2 .12 (2 ) (Jun e 1 8, 2 01 0) . The wh is tl eb lo wer wil l b e n ot ifi edby the Whi st le bl owe r Offi ce o nc e anawardde ci si on ha s b eenm ad e. See i d. p t. 25 .2.2 .5(1 3) (Dec. 3 0, 2 00 8) . II. Ana lysis W e m us t n ow d eci de whet he r th e Co urt h as juri sd ic ti on to rev ie w res po nd en t’s awar d d et erm in at io n. Re sp on de ntarg ue s tha t thi s C ou rt d oe s n ot ha ve juri sd ic ti on to rev ie w hi s awa rdde te rm in at io n b ecau se th e whi st le bl owe r pr ov id edth e in fo rm at io n t o the Whi st le bl owe r Offi ce b efo re the en act m en t o f se ct io n 7 62 3( b) . See Wolf v. Co m m is si on er, T.C. Mem o. 2 00 7- 13 3 (h ol di ng th at th e Co urt l ack edjuri sd ic ti on to rev ie w a de te rm in at io n re ga rd in g awhi st le bl owe r In te rn al Rev enue Man ua l p t. 2 5.2 .2 (De c. 30 , 20 08 ) was up da te d o n J un e 9 18 , 20 10 , to pro vi de ad di ti on al gu id an ce fo r ev al ua ti ng a whi st le bl owe r cl ai m .-1 2-

awardbe cau se th e in fo rm at io n was pro vi de d b efo re Dece m be r 20 , 20 06 ). Thu s, res po nd en t ar gu es th atth is Co urt l ack s juris di ct io n t o re vi ew hi s awa rd de te rm in at io n b ecau se he pro ceed edag ai ns t the tar ge ts us in g i nf orm at io n the whi st le bl owe r pr ov id edbe fo re Dece m be r 20 , 20 06 . The wh is tl eb lo wer arg ue s tha t th is Co urt h as juri sd ic ti onto rev ie w res po nd en t’s awar d d et erm in at io n b ecau se th e whi st le bl owe r al le ge d tha t re sp on de ntpro ceed edag ai ns t the tar ge ts us in g in fo rm at io n the whi st le bl owe r pr ov id edbo thbe fo re an d a fte r Decem be r 20 , 20 06 . See s ec. 7 62 3( b) . W e h ol d tha t the whi st le bl owe r sa ti sf ie d the whi st le bl owe r’s pl ead in g bu rd enby alle gi ng fact s tha t re sp on de ntpro ceed edwith an a ct io n a ga in stth e targ et s u si ng in fo rm at io n b ro ug htto res po nd en t’s at te nt io n b y th e whi st le bl owe r bo th be fo re an d a fte r Decem be r 20 , 20 06 . This is co ns is te ntwith TRHC A’ s i nt en t to pro vi de whi st le bl owe rs with ju di ci al rev ie w of awardde te rm in at io ns . W e n ow tu rnto th e g ov ern in g l aw. A whi st le bl owe r who sat is fie s the requi rem en ts of s ect io n 7 62 3( b) is en ti tl edto rece iv e atlea st15 % bu t n o m or e th an30 % of the co ll ect edpro ceed s o r fro m a se tt le m en t wi thth e ta xp ay er. Add it io na ll y , th e Co m m is si on er m

us t-1 3-

pr oc eed with an a dm in is tra ti ve or ju di ci al act io n b as edonin fo rm at io n b ro ug htto

1 0 th e Co m m is si on er’s at te nt io n b y

th e whi st le bl owe r. See s ec. 7 62 3( b) (1 ). The IRM st at es th atact io n b y th e IRS in cl ud es th e m od ifi cat io n o f a p en di ng or pl an ne d e xa min at io n o r in ve st ig at io n a s a r es ul t o f in fo rm at io n p ro vi de d b y th e whi st le bl owe r. IRM p t. 2 5.2 .2 (J un e 1 8, 2 01 0) . Add it io na ll y , th e TaxCo urt h as ex cl us iv e juri sd ic ti on ov er ap pe al s o f award de te rm in at io ns wher e a wh is tl eb lo wer p ro vi de d i nf orm at io n b ot h b efo re an d a fte r th e eff ect iv e d at e o f TRHCA. See, e.g ., Dacos ta , 82 Fed . Cl. at55 4 (d et erm in in g th atth e TaxCo urt h adex cl us iv e juri sd ic ti onov er the whi st le bl owe r’s cl ai m). The Co urt o f Fed eral Cla im s’ dec is io n i n Dac os tais di rect ly on p oi nt . In Dac os tath e co urt d is m is se d the cas e b ecau se th e co urt fo un d tha t the Tax C ou rt h adex cl us iv e juri sd ic ti on ov er the whi st le bl owe r cl ai m an d the co urt co ul d n ottrans fer the cas e to th e Tax Co urt. Id . at 5 57 (refe ren ci ng 28 U.S.C. sec . 16 31 ). Neve rth el es s, the Daco st a co urt’s an al y si s an d ra ti on al e are pe rs ua si ve . In Dac os ta , as h ere, the cl ai m an ts pro vi de d the Co m m is si on er wi th in fo rm at io n b ot h b efo re an d a fte r th e en act m en t o f TRHCA. Id . at 5 51 . The Go ve rn m en t m ov edto di sm is s fo r la ckof The Co m mis si on er’s p ro po se d re gu la ti on s ex pl ai n tha t the term 1 0 “pr oc eed s” in cl ud es when “ th e IRS in it ia te s a n ew act io n tha t i t wo ul d n otha ve in it ia te d, ex pa nd s the sco pe of a n o ng oi ng act io n tha t i t wo ul d n othave ex pa nd ed , orco nt in ue s t o p ur su e anon go in g a ct io n tha t i t wo ul d n otha ve co nt inue d b utfor th e in fo rm at io n p ro vi de d.” 77 Fed . Reg . 74 80 0 (De c. 18 , 20 12 ).-1 4-

subjec t m at te r juri sd ic ti on an d arg ue d tha t the in fo rm at io n s ub m it te d b y th e cl ai m an ts in20 07 was i de nt ic al to th e in fo rm at io n s ub m it te d i n 2 00 3. Id . at 5 53 . The Gov ern m en t fu rth er ar gu edth at , eve n i f cl ai m an ts pro vi de d n ew an d d iff eren t in fo rm at io n, the Co m

m is si on er d idno t p ro ceedus in g the lat er ap pl ic at io n and do cu m en ts . Id. The co urt re jecte d the Gov ern m en t’s ar gu m en ts an d d et erm in ed th atth e cl ai m an ts all eg edsu ffi ci en t fa ct s t o a va il th em se lv es of s ect io n 7 62 3( b) (1 ) fo r juri sd ic ti on al pu rp os es . Id. at55 4. Th e co urt co nc lu de d tha t the cla im an ts ’ al le ge d fa ct s, i f pr ov enat tria l, wo ul d e st ab li sh th atth e Co m mis si on er ac te d o n in fo rm at io n p ro vi de d b y

th e cl ai m an ts aft er the am en dm en ts to sec ti on 76 23 . Id. The parti es di sp ut e whe th er re sp on de ntpro ceed edag ai ns t the tar ge ts us in g th e whi st le bl owe r’s po st -Dece m be r 20 , 20 06 , in fo rm at io n. Th e whi st le bl owe r’s al le ga ti on s ar e su ffi ci en t t o e st ab li sh juri sd ic ti on . The wh is tl eb lo wer al le ge d tha t th e whi st le bl owe r pr ov id edth e IRS an d the DOJ wit h i nf orm at io n fr om

at l eas t Ju ne 20 06 th ro ug h the fal l o f 20 09 . The p os t-De cem be r 20 06 in fo rm at io n was no t si m pl y co nf irmatory de ta il s. Ra th er, the whi st le bl owe r pr ov id edth e IRS an d the DOJ wit h the fact s tha t fo rm edth e b as is an d g rav am enof r es po nd en t’s ac ti on ag ai ns t the tar ge ts . The wh is tl eb lo wer al le ge d tha t the whi st le bl owe r pr ov id edth e IRS andth e DOJ wi th in fo rm at io n re la te d t o p art ic ul ar ar eas of i nqui ry an d d et ai ls reg ard in g the trans act io ns an d the tar ge ts .-1 5-

Tak in g the co nt es te d fa ctua l al le ga ti on s i n the pe ti ti on as tru e, th ey est ab li sh th atfro m Ju ne 20 06 th ro ug h the fal l o f 20 09 th e whi st le bl owe r was inco ns tant co nt actwith the IRS an d the DOJ an d p ro vi de d the m with the ba si s o f an d d et ai ls on th e ta rg et s’ tax av oi da nc e sc he m e. Whe th er re sp on de ntus edth is in fo rm at io n to pro ceedag ai ns t the tar ge ts is no t a que st io n fo r th e p res en t m ot io n. Th e whi st le bl owe r ha s al le ge d s uf fic ie ntjuri sd ic ti on al fact s t o a va il th e whi st le bl owe r of sec ti on 76 23 (b )(1 ) fo r juri sd ic ti on al pu rp os es an d t o o ve rco m e a m ot io n t o di sm is s fo r la ckof juris di ct io n. If the whi st le bl owe r’s al le ge d fa ct s ar e p ro ve d a t tri al , th ey wou ldest ab li shth atres po nd en t p ro ceed edag ai ns t the tar ge ts us in g in fo rm at io n the whi st le bl owe r pr ov id edaft er Dece m be r 20 , 20 06 . If th es e fac ts are e st ab li sh ed , th e whi st le bl owe r is en ti tl edto jud ic ia l re vi ew of res po nd en t’s awardde te rm in at io n. W e h ol d, co ns is te ntwith the rat io na le of Da co st a, th atth is Co urt h as juri sd ic ti on to rev ie w an awardde te rm in at io n wh ere awhi st le bl owe r ha s al le ge d th atth e whi st le bl owe r pr ov id edin fo rm at io n b ot h b efo re an d a fte r th e en act m en t o f se ct io n 7 62 3( b) . W e h av e co ns id eredall rem ai ni ng arg um en ts th e p art ie s m ad e an d, t o the ex te ntno t ad dr es se d, we co nc lu de th ey are i rrel ev an t, m oo t o r m eri tl es s.-1 6-

Fo r th e fo reg oi ng reas on s, we s ha ll de ny resp on de nt ’s m ot io n t o d is m is s. An ap pr op ria te ord er wi ll be is su ed .