Les Fields/C.C.H.I. Insurance Services v. United States of America

Filing 51

JOINT STATUS REPORT AND ORDER MAINTAINING STAY UNTIL MARCH 10, 2017. Signed by Judge Alsup on 1/11/17. (whalc1, COURT STAFF) (Filed on 1/11/2017)

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1 BRIAN J. STRETCH (CABN 163973) United States Attorney 2 THOMAS MOORE (ASBN 4305-078T) Chief, Tax Division 3 CYNTHIA STIER (DCBN 423256) 4 Assistant United States Attorney 450 Golden Gate Avenue, Box 36055 San Francisco, California 94102-3495 5 Telephone: (415) 436-7000 6 FAX: (415) 436-7009 7 Attorneys for the United States 8 UNITED STATES DISTRICT COURT 9 NORTHERN DISTRICT OF CALIFORNIA 10 SAN FRANCISCO DIVISION 11 12 LES FIELDS/C.C.H.I. INSURANCE SERVICES, A California corporation, 13 14 Case No. CV-15-02411 WHA JOINT STATUS REPORT and [PROPOSED] ORDER MAINTAINING STAY UNTIL FEBRUARY 10. 2017 March Plaintiff, v. 15 UNITED STATES OF AMERICA, 16 17 Defendant. 18 19 This Court has stayed this action pending the resolution of an associated Tax Court case which 20 has litigated the same issues. The Court has maintained the stay, originally entered on January 25, 2016, 21 three times after receiving joint status reports. The most recent Order maintaining the stay was entered 22 after the parties represented that tax computations were due in the Tax Court on December 5, 2016, 23 which were necessary to resolve this district court tax refund suit. The Tax Court has extended the date 24 to submit the computations to February 21, 2017. 25 One issue in this case is whether Plaintiff’s corporate officer, Les Fields, was an employee of 26 Plaintiff during the periods at issue. That issue has been resolved, with the parties agreeing that Les 27 Fields was an employee of Plaintiff for employment tax purposes. Because Plaintiff treated Fields as an 28 independent contractor, however, Plaintiff did not make deposits of employment taxes. The Internal Joint Status Report C-15-02411-WHA 1 1 Revenue Service assessed a penalty under Section 6656 with respect to the Plaintiff’s failure to make 2 deposits of employment taxes during the periods at issue. The penalty was not at issue in the Tax Court 3 case. The Tax Court case was limited to the corporation’s income tax liabilities, including the amount 4 of wage expenses the corporation could claim with respect to the years at issue. The Section 6656 5 penalties therefore remain at issue in the District Court Case. 6 The parties anticipate that computations of Plaintiff’s employment tax liabilities reflecting the 7 agreed wage amounts, including penalty amounts, will be provided to Plaintiff’s counsel during the 8 week of January 23, 2017. The parties require a few weeks after the computations are presented in 9 order to determine if they can negotiate a resolution of the penalties. Accordingly, the parties request a 10 further extension of the stay to determine whether to dismiss this case or proceed to litigation in district 11 court with the remaining issues in this case. Accordingly, the parties request that this Court maintain the 12 stay through March 10, 2017. The parties will submit a joint status report on March 8, 2017, by noon. 13 Respectfully submitted, 14 BRIAN J. STRETCH United States Attorney 15 __________/S/____________ CYNTHIA STIER Assistant U.S. Attorney Tax Division 16 17 18 19 ________/s/______________ BERNARD KENNEALLY Counsel for Plaintiff, Les Fields 20 21 22 23 ORDER MAINTAINING STAY For the reasons set forth in the Joint Status Report filed by the parties, the stay is maintained 24 until March 10, 2017. The parties shall file a joint status report by March 8, 2017, by noon. 11 January 25 SO ORDERED this ___ day of _________, 2017. 26 ____________________________ WILLIAM ALSUP United States District Judge 27 28 Joint Status Report C-15-02411-WHA 2

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