• March 19, 2010

Previously, in reference to the “bubbly battle,” Minnesota Litigator touched on the paradoxical strategy of bringing a motion before a Judge to ask the Judge to ignore evidence that the other side will seek to offer at trial (before the same Judge).  Needless to say, the Judge will have to look at the evidence to decide whether to ignore the evidence.  As previously discussed, the counter-intuitive maneuver can actually make sense.

It did not appear to have the intended outcome for Wells Fargo or the I.R.S. before U.S. District Court Judge John Tunheim (D. Minn.), who denied cross-motions to exclude experts in a fight over an “underwater lease transaction” alleged by the I.R.S. to have been “an abusive tax shelter.”

Judge Tunheim’s opinion takes some time to discuss the nature of motions in limine in the context of bench trials and the appropriate standard by which the Court will evaluate such motions.

One might think that a trial over the subject of the bench trial in this case, the legitimacy of a large financial transaction (that is, an inquiry into “whether the transaction had any practical economic effects other than the creation of income tax losses”) might be decided “on the papers” (that is, without taking testimony, without a trial) but, arguably, a bench trial provides the opportunity for interactive three-way dialogue which might facilitate the Court’s analysis of a sophisticated and legitimate business transaction or, conversely, of a purposefully complicated and opaque sham, as the case may be.

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