SCHEINGOLD v. U.S

JEROME SIMANDLE, District Judge

The United States and third-party defendant Edward Trueblood each bring motions in limine in this case. Third-party defendant Trueblood seeks to exclude evidence sought to be admitted by plaintiff Daniel Scheingold; the testimony of the United States' witnesses Revenue Officers Rosalind Alford and Frank Clark, Donna Orem (wife of third-party defendant John Orem), and Michael Stella of the IRS; any testimony or documents pertaining to Trueblood's alleged ownership of a corporation named SMT, Inc., and other certain information regarding SMT and IE; and certain documents proffered by defendant. Trueblood also seeks to limit the testimony of any witnesses called by defendant, including Daniel Scheingold, John Orem, Edward Trueblood, and Ceasar Foti.

The United States, in its motion in limine, seeks the exclusion of testimony of several witnesses and documents listed on the Joint Final Pretrial Order, including that of Frank Wells, Jr., Charles Rossotti, the Commissioner of the IRS, and Nancy Daniels, Giovanni Barreto, Douglas Engler, all employees of the IRS. The United States specifically seeks to exclude documents T-37, T-39, T-48, T-50, T-59, T-62 and T-70, which it alleges were never disclosed previously. For the reasons discussed herein, Trueblood's motion in limine will be granted in part, denied in part, and dismissed in part as moot, and the United States' motion in limine will be granted in part and denied in part.

I. BACKGROUND

The case involves two related tax suits, filed on May 4, 2000 and September 22, 2000, in which plaintiff Daniel K. Scheingold sought refunds of taxes collected from him by the Internal Revenue Service on account of responsible person assessments made against him under Internal Revenue Code § 6672 for unpaid payroll tax liabilities of IE, Inc. ("IE") and Street Holding Company ("SHC"). These assessments were made for unpaid payroll tax liabilities of IE for the last three quarters of 1995, all four quarters of 1996, and the second and third quarters of 1997, and for SHC for the last four quarters of 1995 and the first quarter of 1996. Scheingold's first complaint, filed on May 4, 2000, sought a $100 judgment plus abatement of the trust fund recovery penalty with respect to IE, while his second complaint filed on September 22, 2000, sought a $100 judgment plus abatement of the trust fund recovery penalty with respect to SHC. (Compl. 5/4/00; Compl. 9/22/00.) The United States filed its third-party complaint in Civil Number 00-2150 against Edward Trueblood on October 19, 2000. The United States also filed third-party complaints against John Orem as an alleged responsible officer of IE, and as an alleged responsible officer of SHC. (Id.)

The United States served its Rule 26(a) disclosures on May 3, 2001, which were supplemented on June 11, 2001. Trueblood served his initial Rule 26(a) disclosures on the United States on July 12, 2001, (United States' Br. Ex. A B), and supplemented the disclosure with a witness list on August 22, 2001, which disclosed three witnesses, Clara Vassallo, Marie Winkler, and Ed Suarez. (Id. Ex. C.) The Joint Final Pretrial Order was approved by Magistrate Judge Kugler and filed on March 19, 2002. (Id. Ex. D.) At the Final Pre-Trial Conference on March 11, 2002, Judge Kugler also set the deadline for the parties to file their motions in limine by April 15, 2002, and responses by April 22, 2002.

In the Joint Final Pretrial Order, Trueblood lists witnesses Frank Wells, Jr., Charles Rossotti, Nancy Daniels, Giovanni Barreto, and Douglas Engler; proposed exhibits T-37 (letter dated 8/16/98), T-39 (letter dated 5/15/97), T-48 (notes indicating the existence of companies owned by Mr. Orem), T-49 (notes indicating the existence of companies owned by Mr. Orem), T-50 (letter dated 3/16/97), T-62 (letter to Mr. Orem regarding any new attorney hired to file bankruptcy), and T-70 (personal income tax returns) as exhibits, none of which were disclosed previously. (United States' Br. Ex. D.)

In both lawsuits, default was entered on November 14, 2002, as to John Orem for failure to appear, plead, or otherwise defend. (Order, 11/14/02.) In addition, plaintiff Scheingold, through his attorney, had indicated to the Court in a telephone conference of September 11, 2002, that he wished to voluntarily dismiss his complaint, the United States having no objection, provided that its counterclaim against Scheingold and third-party claims against Orem and Trueblood are preserved. This Court accordingly found good cause under Rule 41(a), Fed.R.Civ.P., to voluntarily dismiss Scheingold's complaint and entered an Order on September 13, 2002, dismissing Scheingold's complaints with prejudice, and leaving intact the United States' counterclaim and third-party claims. (Order, 9/13/02.) Trueblood's motion in limine was filed on May 17, 2002, and the United States' motion in limine was filed on April 16, 2002.

The United States initially objects to Trueblood's motion in limine as filed outside the timeframe for the submission of motions in limine as set by Judge Kugler. Although the Court is mindful of Trueblood's failure to observe the procedural requirements of the Court, it nevertheless will address the arguments on the merits. It is unclear that the Court's orderly processes or the interest of the United States were prejudiced by Trueblood's late filing.

II. DISCUSSION

A. Trueblood's Motion in Limine

1. Evidence from Scheingold

Trueblood objects to evidence submitted by plaintiff Scheingold because "Scheingold has no cause of action against Trueblood" and has made no disclosure of any witnesses or documents under Rule 26(a), Fed.R.Civ.P. Trueblood Br. at 3. Trueblood further seeks to exclude such testimony as irrelevant, citing Rule 401, Fed.R.Evid. Id. at 5. Rule 37(a), Fed.R.Civ.P., provides:

A party that without substantial justification fails to disclose information required by Rule 26(a) or 26(e)(1) . . . is not, unless such failure is harmless, permitted to use as evidence at a trial, at a hearing, or on a motion any witness or information not so disclosed.

Fed.R.Civ.P. 27(a). The failure to disclose information required by Rule 26 precludes the use of the non-disclosed information at trial. See Nicholas v. Pennsylvania State Univ., 227 F.3d 133, 147-48 (3d Cir. 2000); Konstantopoulos v. Westvaco Corp., 112 F.3d 719, 719 (3d Cir. 1997). Preclusion of such evidence does not apply if the failure to disclose was substantially justified. See Rule 37(c)(1); Nicholas, 227 F.3d at 148; Konstantopoulos, 112 F.3d at 719.

Here, inasmuch as Scheingold's complaint is no longer active because he has voluntarily dismissed his complaints and this Court accordingly entered an Order dismissing his complaints with prejudice on September 13, 2002, see Order 9/13/02, Trueblood's motion is moot as to Scheingold, who will not be participating as a plaintiff in trial. Trueblood's motion in limine to exclude Scheingold's witnesses and documents is therefore moot on this ground, and this portion of his motion will be dismissed.

Trueblood's motion had sought to exclude the following documents: P-6; P-7; P-10; P-11; P-14; P-15; P-16; P-20; and P-21. See Trueblood Br. at 5.

2. Testimony of United States' Witnesses

Trueblood seeks to exclude the testimony of certain witnesses listed by the United States in its final pre-trial order, namely Revenue Officers Rosalind Alford and Frank Clark, Michael Stella of the IRS, and Donna Orem (spouse of John Orem). Trueblood seeks exclusion of their testimony because he alleges that the United States did not include these witnesses in its Rule 26(a) disclosures, pursuant to Rule 37(c)(1), Fed.R.Civ.P. Trueblood also seeks exclusion of testimony Donna Orem as irrelevant under Rule 402, Fed.R.Evid.

Rule 37(c)(1) provides in part:

A party that without substantial justification fails to disclose information required by Rule 26(a) or 26(e)(1), or to amend a prior response to discovery as required by Rule 26(e)(2), is not, unless such failure is harmless, permitted to use as evidence at a trial, at a hearing, or on a motion any witness or information not so disclosed.

Rule 37(c)(1), Fed.R.Civ.P. In this case, the United States had not disputed that it failed to disclose these witnesses pursuant to Rule 26(a). However, the United States correctly points out that Trueblood also calls Alford and Clark as witnesses in his portion of the final pre-trial order. See Final Pre-Trial Order, Trueblood Br. Ex. 6. The roles of Alford and Clark are thus well known to both parties through pretrial discovery, thus averting unfair surprise at trial. Because Trueblood also seeks to call Alford and Clark as his own witnesses at trial, Trueblood's motion will be denied as to Alford and Clark.

The United States argues that Donna Orem's testimony is intended as rebuttal testimony, primarily to address allegations that her husband was running the companies full-time, rather than receiving treatment, which is relevant to the timing and extent of Orem's illness and rehabilitation as it affected his delegation of responsibility within his two companies. Although not disclosed pursuant to Rule 26(a), Mrs. Orem's testimony will be permitted for purposes of rebuttal testimony regarding her husband's ability to run the companies. Trueblood's motion will therefore be denied to the extent that Mrs. Orem's testimony will be permitted as rebuttal testimony.

Furthermore, contrary to Trueblood's argument, Mrs. Orem's testimony is not irrelevant under Rule 402, Fed.R.Evid. Rule 402 provides that "[e]vidence which is not relevant is not admissible." Rule 402, Fed.R.Evid. Mrs. Orem's testimony as it relates to John Orem's physical condition during the time periods at issue is relevant to his ability to conduct his usual duties at his two companies, and therefore sheds light on his delegation of tasks within the company after his stroke occurred. Because Mrs. Orem's testimony is relevant to the delegation of duties after John Orem's stroke, and therefore the extent of responsibility taken by other officers of the company, such testimony is relevant under Rule 402. Trueblood's motion will be denied as to Mrs. Orem's testimony.

The United States, in its response papers, indicates that, although it would prefer Mr. Orem to testify in person, it will seek to use his videotaped deposition if his health has so declined that it is impossible for him to appear. See United States' Reply Br. at 5.

The government does not provide any reason as to why Michael Stella's testimony should not be excluded. Trueblood asserts that Stella was not disclosed as a witness and therefore Trueblood has had no previous chance to depose him. Under Rule 37(c)(1), the United States has failed to disclose Stella's testimony, but has not shown how such failure is harmless. Therefore, Trueblood's motion in limine will be granted as to Michael Stella, and the United States will not be permitted to use Stella's testimony in trial.

3. Limitation of Testimony of the United States' Witnesses

Trueblood seeks limitation of testimony given by Daniel Scheingold, John Orem, Edward Trueblood, Ceasar Foti, or any other witness called by the government insofar as the testimony "should be specifically limited to the responsibility and wilfulness as defined under the statute, IRC § 6672." Trueblood Br. at 6. Trueblood proposes that each line of their respective deposition testimony be identified as to which item of the seven prong test to prove responsibility under IRC § 6672 it is supporting, and that any testimony not relevant to such criteria be excluded for irrelevancy.

The seven factors are listed as:

(i) The ability of the individual in question to sign checks on the corporation's bank accounts;

(ii) The identity of the individual who signed the corporation's quarterly Form 941 tax returns during the tax quarters in question, as well as other tax returns of the corporation;

(iii) The identity of the corporation's officers, directors and stockholders;

(iv) The identity of the individuals who hired and fired employees;

(v) The individual or individuals who had control of the financial affairs of the corporation on a day-to-day basis, and/or who made decisions or participated in making decisions as to disbursement of funds and payments to creditors;

(vi) Payment of other creditors in lieu of the United States; and

(vii) The duties of the individual, if an officer, as set forth in the contents of the corporation's bylaws.

See Greenberg v. United States, 46 F.3d 239, 243 (3d Cir. 1994); Brounstein v. United States, 979 F.2d 952, 954 (3d Cir. 1992).

Although Rule 402, Fed.R.Evid., provides that evidence which is irrelevant is inadmissible, Trueblood does not demonstrate how testimony that goes beyond the seven factors considered in determining a responsible person under § 6672 is irrelevant in this case. It is certain that testimony of Scheingold, Orem, Foti, and Trueblood himself on the background of the companies and the respective responsibilities of the various officers involved will be elicited at trial. Testimony will also be elicited by several Revenue Officers to provide facts regarding the interactions between the IRS and the companies, both before and after the assessments were made. Even if such testimony goes beyond the seven factors Trueblood listed, it cannot be concluded that the testimony is automatically irrelevant, particularly because some factual premise must provide context to the jury.

Furthermore, Trueblood's notion of limiting deposition testimony line by line to exclude irrelevant testimony provides an unworkable and impracticable scheme that would require more time and expense than is possible or necessary. To the extent that testimony actually elicited at trial is irrelevant, the parties are not precluded from raising appropriate objections at that time. Accordingly, Trueblood's motion will be denied on this ground.

4. Other Testimony and Documents

Trueblood also seeks to exclude testimony or documents relating to Trueblood's alleged ownership of a corporation named SMT, Inc. ("SMT"); the alleged amount owed by SMT to IE or any affiliate or corporation owned and operated by Orem and Scheingold; any other transaction between SMT and IE, any IE affiliate, or any other company owned by John Orem; any alleged willfulness or responsibility of Trueblood that is allegedly associated with any other corporation other than IE; and statements that John Orem's alleged stroke and condition caused him to be mentally and/or physically incapable of being responsible and willful to the extent that he transferred or partially transferred the operation and decision-making authority to Trueblood for any moment of time. See Trueblood Br. at 7-8. Trueblood seeks exclusion of this evidence under Rules 35, Fed.R.Civ.P., and Rule 401, Fed.R.Evid., because the information "lacks any substantial relevance to the statutory test that establishes liability for trust fund taxes. . . . [and] creates an unfair prejudice, and confusion. . . ." Id. at 8-9.

The Court is in agreement with the United States, which argues that testimony regarding SMT and its relationship with IE and Street Holding Company, including Trueblood's alleged ownership of SMT and/or any other company, should be permitted because the testimony is relevant to the issue of the relationship between Orem, his companies, and Trueblood, and furthermore, that it indicates what precipitated the failure to pay the government its trust fund taxes. The testimony is also relevant to whether the alleged responsible officer had significant control over the corporation's finances, and its attendant business transactions with other companies including SMT and Street Holding Company, and could have prevented the tax default from occurring. Contrary to Trueblood's assertion, testimony regarding Orem's stroke and mental and physical capabilities is directly relevant to the issue of whether he indeed transferred responsibility and decision-making authority to any other officer, Trueblood included. Such testimony or evidence goes to the ultimate "responsible person" determination under § 6672. It is not possible to anticipate all trial testimony or to make an intelligent ruling in limine under these circumstances. Accordingly, Trueblood's motion will be denied on this ground.

If, at the time of trial, Trueblood believes that particular evidence is not relevant, and if the objection has been preserved in the Joint Final Pretrial Order, then the objection should be renewed.

5. Documents Proffered by Defendant

Trueblood also seeks to exclude the following documents proffered by defendant United States in the Joint Final Pretrial Order: G-21, an unsigned letter allegedly from Trueblood, on grounds it is hearsay and confusing and therefore prohibited under Rules 801 and 403, Fed.R.Evid.; G-22 and G-23, on grounds they were not provided under Rule 26(a), Fed.R.Civ.P.; and G-27, which pertains to SMT, on grounds it is hearsay and confusing under Rules 801 and 403, Fed.R.Evid.

Trueblood mistakenly refers to these exhibits as G-25, G-26, G-27, and G-31 in his brief. Apparently, these numbers were attributed to the documents at issue in the draft version of the Joint Final Pre-trial Order.

The United States argues that Exhibit G-21, an unsigned letter with a signature block from Trueblood as Chief Executive Officer of IE, is not hearsay because it is an admission of a party. The government alternatively asserts that the letter is not proof of the matter asserted, that Trueblood was indeed CEO of IE, but rather as proof that (1) Trueblood was involved in the day-to-day operations of IE in that he had discussions with clients; and (2) Trueblood or others within IE held Trueblood out to the public as the CEO of IE. See United States' Reply Br. at 7. Additionally, the government argues that even if the document were hearsay, it would fall into the business records exception, as it was kept in the regular course of business by the records custodian of IE, namely John Orem. Id. Also, the government contends that the letter has intrinsic value as impeachment evidence, as Trueblood in several depositions has advanced several competing theories regarding the letter.

The contention that the document falls within a hearsay exception as an admission of a party opponent under Rule 801 fails because the letter was never signed, and therefore the contents in the document cannot be attributed to Trueblood, whose signature block, but not his signature, appears on the bottom of the letter. The United States argues that the document is not hearsay under Rule 801, however, because it is being offered into evidence for the purpose of proving that Trueblood had a significant role in the company and that the company held Trueblood out to the public as its CEO, though not to prove that Trueblood was indeed the CEO of IE. The Court disagrees, because the contents of this document are sought to be admitted into evidence for the purpose of proving the truth of those contents, namely, that Mr. Trueblood was acting as the CEO. If someone within IE, without Trueblood's knowledge, were merely fabricating letters on corporate stationery to make it appear that Trueblood was the CEO when in fact he was not, then the letter would not be probative of Trueblood's culpability under § 6672.

Rule 801 provides, in part:
(d) A statement is not hearsay if

(2) The statement is offered against a party and is (A) the party's own statement, in either an individual or a representative capacity or (B) a statement of which the party has manifested an adoption or belief in its truth, or (C) a statement by a person authorized by the party to make a statement concerning the subject, or (D) a statement by the party's agent or servant concerning a matter within the scope of the agency or employment, made during the existence of the relationship; or (E) a statement by a coconspirator of a party during the course and in furtherance of the conspiracy.

Rule 801(d)(2), Fed.R.Evid.

Even if the document were hearsay, however, it would be admissible under the business records exception of Rule 803(6), which provides, in part:

A memorandum, report, record, or data compilation, in any form, of acts, events, conditions, opinions, or diagnoses, made at or near the time by, or from information transmitted by, a person with knowledge, if kept in the course of a regularly conducted business activity, and if it was the regular practice of that business activity to make the memorandum, report, record or data compilation, all as shown by the testimony of the custodian or other qualified witness, or by certification that complies with Rule 902(11), Rule 902(12), or a statute permitting certification, unless the source of information or the method of circumstances of preparation indicate lack of trustworthiness.

Rule 803(6), Fed.R.Evid. Thus, under Rule 803(6), the document may be admissible as a business record provided that Mr. Orem, alleged to be the records custodian of IE, testifies as to its mode of preparation and retention in the normal course of IE's business at trial. Accordingly, Trueblood's motion will be denied as to Exhibit G-21, but the Court does not determine that it is admissible either. The United States must proffer at trial, out of the jury's presence, the necessary foundational proofs for admitting the document as a business record under Rule 803(6), Fed.R.Evid.

If Orem is unable to give such testimony, the government may refer to the document for impeachment purposes, to the extent that Trueblood has previously provided alternating theories regarding the letter in his deposition testimony, and such testimony is elicited in the context of discussing his position within the company.

The government explains that the documents G-22 and G-23 (which Trueblood mistakenly referred to as G-26 and G-27 in his moving papers) were indeed provided in the government's initial disclosures. G-26 consists of invoices from SMT to IE, Bates numbers 1946-2046, and G-27 is a letter from Rudi Grueneberg, Esq. to Trueblood regarding liability to IE and Street Holding Corp., Bates numbers 1898-1899. G-22 refers to Bates numbers 693, and G-23 consists of Bates numbers 369-370 and 1487-1553, and these documents were disclosed by the government. Accordingly, Trueblood's motion will be denied as to G-22 and G-23.

As for Exhibit G-27, the government contends that the letter falls within the business records exception to the hearsay rule because it was kept in the ordinary course of business by John Orem. Alternatively, the government argues that the letter is not hearsay because its purpose is to rebut Trueblood's contention that Orem's recollection of the facts is inaccurate due to his poor health. The document indicates that Trueblood, through his company SMT, owed a substantial debt to IE and that he defaulted on repaying that obligation.

As with Exhibit G-21, the document G-27 may fall within the business records exception if Orem is able to lay the foundation required by Rule 803(6). If such an option is not available, the documents may be admitted for rebuttal purposes to the extent that Trueblood asserts that Orem's recollection of events regarding IE's business dealings with SMT and SMT's failure to repay its debt to IE is impaired by poor health. Furthermore, besides his one-sentence argument seeking to exclude the document, Trueblood has not given any reason or explanation of how Exhibit G-27 is more prejudicial than probative under Rule 403, Fed.R.Evid. Accordingly, Trueblood's motion will be denied without prejudice to renewal at trial with respect to Exhibits G-21, G-22, G-23, and G-27.

B. United States' Motion in Limine

1. Nondisclosed Documents and Testimony

The United States seeks exclusion of testimony from witnesses Frank Wells, Jr., Charles Rossotti, Nancy Daniels, Giovanni Barreto, and Douglas Engler, who are allegedly not listed anywhere in Trueblood's disclosures or anywhere else in the record. As discussed above, pursuant to Rule 37(c)(1), failure to disclose information required under Rule 26, Fed.R.Civ.P., can preclude the use of the non-disclosed information at trial. See Rule 37(c)(1); Nicholas, 227 F.3d at 147-48. Preclusion of such evidence does not apply if the failure to disclose was substantially justified. See Rule 37(c)(1); Nicholas, 227 F.3d at 148; Konstantopoulos, 112 F.3d at 719.

In this case, Trueblood disclosed three witnesses, Clara Vassallo, Marie Winkler, and Ed Suarez, in his initial disclosure of witnesses dated August 22, 2001, see United States' Br. Ex. C, though he names Wells, Rossotti, Daniels, Barreto, and Engler in the Joint Final Pretrial Order. Id. Ex. D. Prior to the submission of his portion of the Joint Final Pretrial Order, Trueblood had not attempted to supplement his disclosures with these new witnesses, nor had new discovery been conducted since the filing of the Joint Final Pretrial Order.

Trueblood contends that the government was made aware of these witnesses through his Rule 26(a) disclosure of certain documents, consisting of correspondence from Trueblood to Barreto, see Trueblood Br. Ex. 3; a letter from Trueblood to Engler, see id. Ex. 2; and a memorandum allegedly written by Rudi Grueneberg, Esq., of 11/25/98, which mentions a "Manager Daniels." Id. Ex. 4. Notwithstanding his disclosure of these documents, Trueblood does not demonstrate how the disclosure of Barreto, Engler, and Daniels, as individuals likely to have discoverable information, was made available to the government under Rule 26(a)(1)(A) prior to the filing of the Joint Final Pretrial Order. In addition, Trueblood states that the government "has not demonstrated any effort to obtain discovery with regard to other witnesses of the third party defendant, and these other witnesses shall also testify, inter alia, as to how Trueblood's time was spent [allegedly in the day to day operation of IE]." Trueblood Br. at 12.

While it is likely that the government never sought to obtain discovery as to these witnesses precisely because it was never made aware of Trueblood's assertion that these persons have relevant information, Trueblood fails to demonstrate how his failure to disclose was substantially justified, nor has he explained how this nondisclosure has not prejudiced defendant. Even at this late date, the contours of their proposed testimony have not been revealed. Accordingly, the United States' motion will be granted on this ground, and the testimony of Wells, Rossotti, Daniels, Barreto, and Engler will be excluded for trial.

The government also sought to exclude the testimony of Rossotti as irrelevant, and Engler, Barreto and Daniels as unnecessarily duplicative. See United States' Br. at 7-8. Because this Court has excluded the testimony of these witnesses above, these arguments need not be addressed.

The United States also seeks exclusion of exhibits T-37, T-39, T-48, T-50, T-59, T-62, and T-70, see Joint Final Pretrial Order, United States' Br. Ex. D, all of which allegedly were not disclosed previously. Furthermore, the government contends, the documents identified as T-70, which consist of Trueblood's tax returns, were allegedly requested by counsel for the United States at his deposition and Trueblood refused to provide them.

Trueblood asserts that he previously provided documents T-37, T-39, T-48, T-50, T-59, and T-62 to the government in his initial disclosures. After reviewing Trueblood's draft Pretrial Order and comparing it with the Joint Final Pretrial Order that was approved and filed by Judge Kugler, there is no discrepancy regarding the numbering system. The government, in its reply papers, indicates that there was some confusion regarding Trueblood's numbering of exhibits and withdraws the objection for nondisclosure to the extent that these documents were already disclosed. See United States' Reply Br. at 9 n. 1.

The government, in its response, however, maintains its objection to Trueblood's tax returns, and moves to additionally exclude exhibits T-71 through T-88. See United States' Reply Br. at 9. As for his income tax returns, Trueblood contends that the tax returns

were shared with the US attorney at the oral deposition of Trueblood, however the returns were given to the US Attorney Dara Oliphant at the Trueblood deposition, but after the Court Reporter departed. US Attorney Lawrence Blaskopf forgot or neglected to follow up to his request for the tax returns during the deposition, even though they were presented to him.

Trueblood Br. at 10. If the tax returns were indeed presented to the government during Trueblood's deposition, and the government never followed up on retrieving the tax returns from Trueblood, it is not apparent that Trueblood failed to disclose such documents pursuant to Rule 26(a). It appears likely that miscommunication had occurred subsequent to Trueblood's deposition, where he had apparently allowed the government to examine the documents. If the government had sought to retrieve the tax returns after the deposition, yet encountered resistance by Trueblood, it could have sought intervention by the Court to obtain them, yet no attempt was made as far as this Court is aware, and the government has not alleged any occurrence of this nature. The government therefore knew of the existence of the tax returns and cannot now benefit from the exclusion of these documents. The United States' motion will be denied as to exhibit T-70.

With respect to exhibits T-71 to T-88, notwithstanding the nondisclosure of such documents, Trueblood does not demonstrate how the documents should nonetheless be admissible at trial. Although this Court is not fond of new arguments submitted within the context of reply papers, it can be argued that the third party defendant could have responded to this new argument. No attempt of this kind having been made, and Trueblood not disputing the nondisclosure of these documents, the documents will be excluded to the extent they were nondisclosed.

2. Tax Compliance Program

The United States seeks to exclude testimony of IRS witnesses regarding "a program designed to promote tax compliance by attorneys." United States' Br. at 3. In the Joint Final Pretrial Order, Trueblood sought to have Charles Rossotti and Nancy Daniels testify regarding the alleged tax compliance program. The United States asserts that the evidence of such a program is prejudicial to them because this defense was never disclosed to them. Insofar as the testimony of these witnesses has been excluded above due to Trueblood's failure to disclose these witnesses, the United States' motion will be granted with respect to these witnesses providing testimony regarding the alleged Attorney Compliance program.

The Court does not agree that evidence of an Attorney Compliance Program is irrelevant to the inquiry of responsible person under § 6672, primarily because such evidence goes to whether an alleged officer was conducting business in the capacity of a responsible officer within the confines of a pre-existing program, authorized by the IRS. Testimony, elicited by third party defendant Trueblood, for example, regarding such a program will not be excluded. The government's motion will be denied in part on this ground.

CONCLUSION

For the reasons discussed above, Trueblood's motion in limine will be dismissed as moot with respect to evidence offered by plaintiff Scheingold; denied as to the testimony of witnesses Alford and Clark; denied to the extent that Mrs. Orem's testimony will be for rebuttal purposes; granted as to the testimony of Michael Stella; denied with respect to limiting the testimony of the government's witnesses regarding only the seven factors for determining "responsible person" under § 6672; denied with respect to testimony regarding the SMT company and Orem's stroke and resultant condition; and denied with respect to the governments' exhibits G-21, G-22, G-23, and G-27. The government's motion in limine will be granted as to the testimony of Frank Wells, Jr., Charles Rossotti, Nancy Daniels, Giovanni Barreto, and Douglas Engler; denied with respect to exhibits T-37, T-39, T-48, T-50, T-59, and T-62, and granted with respect to T-71 through T-88; granted with respect to testimony of Nancy Daniels and Charles Rossotti regarding the Tax Compliance Program, but denied with respect to testimony of other individuals, including Trueblood himself, regarding the Tax Compliance Program. The accompanying Order will be entered.

ORDER

THIS MATTER having come before the Court upon the motions in limine brought by third-party defendant Edward Trueblood and the defendant and third-party plaintiff United States; and the Court having considered the parties' submissions; and for the reasons stated in the Opinion of today's date;

IT IS on this ____ day of December, 2002, hereby

ORDERED that third-party defendant Trueblood's motion in limine is DISMISSED in part as moot with respect to evidence offered by plaintiff Scheingold; DENIED in part as to the testimony of witnesses Alford and Clark, and such testimony is admissible; DENIED in part to the extent that Mrs. Orem's testimony may be admitted for rebuttal purposes; GRANTED in part as to the testimony of Michael Stella, and such testimony is excluded; DENIED in part with respect to limiting the testimony of the government's witnesses regarding only the seven factors for determining "responsible person" under § 6672; DENIED in part with respect to testimony regarding the SMT company and Orem's stroke and resultant condition, and such evidence is admissible; and DENIED in part with respect to the governments' exhibits G-21, G-22, G-23, and G-27, and such evidence is admissible if a proper foundation is laid at trial; and

IT IS FURTHER ORDERED that the government's motion in limine be, and hereby is, GRANTED in part as to the testimony of Frank Wells, Jr., Charles Rossotti, Nancy Daniels, Giovanni Barreto, and Douglas Engler, and such testimony is excluded; DENIED in part with respect to exhibits T-37, T-39, T-48, T-50, T-59, and T-62, and those exhibits are admissible if a proper foundation is laid at trial, and GRANTED in part with respect to exhibits T-71 through T-88, and those exhibits are excluded; GRANTED in part with respect to testimony of Nancy Daniels and Charles Rossotti regarding the Tax Compliance Program, but DENIED in part with respect to testimony regarding the Tax Compliance Program by other individuals, including Trueblood himself.