United States of America v. Gould et al

Filing 82

MINUTE ORDER denying defendant David Gould's 67 Motion for Summary Judgment ; granting in part and denying in part plaintiff's 74 Motion for Sanctions ; granting in part and denying in part plaintiff's 75 Motion for Leave to Serve by Publication for Extension of Time to Serve ; denying defendant David Gould's 77 Motion to Dismiss; Joint Status Report due within fourteen days of the date of this Minute Order. Authorized signed by Judge Thomas S. Zilly. (SWT)

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

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UNITED STATES OF AMERICA,
Plaintiff,

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C16-1041 TSZ
v.

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MINUTE ORDER
DAVID A. GOULD, et al.,

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Defendants.

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The following Minute Order is made by direction of the Court, the Honorable
Thomas S. Zilly, United States District Judge:

(1)
Defendant David A. Gould’s motion for summary judgment, docket no. 67,
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(2)
The Government’s motion for sanctions against defendant David A. Gould,
docket no. 74, is GRANTED in part and DENIED in part as follows. The Government
properly noted Gould’s deposition for June 22, 2018, in Seattle, see Minute Order at ¶ 2
(docket no. 64); see also Ex. 22 to Butler Decl. (docket no. 74-3) (indicating that Gould’s
Israeli passport was valid for travel to all countries), and Gould’s failure to attend the
deposition is grounds for sanctions. See Fed. R. Civ. P. 37(d)(1)(A)(i). The Court is not
satisfied, however, that the Government’s requested sanction of default judgment is
warranted. Before imposing such sanction, the Court must be persuaded that less drastic
sanctions are unavailable. See, e.g., Adriana Intern Corp. v. Thoeren, 913 F.2d 1406,
1412-13 (9th Cir. 1990). The Court cannot yet draw the requisite conclusion. Gould’s
continued refusal to fully participate in discovery is more problematic for him than for
the Government. The Government is entitled to a presumption that the returns prepared
by the Internal Revenue Service pursuant to 26 U.S.C. § 6020(b)(1), on which the tax
assessments at issue in this matter are based, are “prima facie good and sufficient for all
legal purposes.” 26 U.S.C. § 6020(b)(2). At trial, Gould may not rely on any documents
responsive to discovery requests that he did not produce to the Government (and to
defendant Jane C. Polinder). 1 Gould is hereby ADVISED that further efforts to obstruct

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Gould has indicated that some of his files were in Polinder’s possession, and could not be
retrieved as a result of a restraining order. See Ex. 4 to Butler Decl. (docket no. 74-2). The
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MINUTE ORDER - 1

1 the Government’s discovery efforts will not be tolerated. Gould will be provided another
opportunity to appear for a deposition. All counsel of record and Gould shall meet and
2 confer telephonically or via email concerning a mutually convenient date and time for
Gould’s deposition, which shall occur in Seattle no later than January 31, 2019. If Gould
3 wishes to supplement his responses to written discovery requests, he shall do so on or
before December 31, 2018. If Gould again fails to timely appear for his deposition, the
4 Court will consider imposing harsher sanctions, including monetary penalties, precluding
Gould from testifying or presenting evidence at trial, and entry of default judgment.
5 Except as granted herein, the motion for sanctions is DENIED.
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(3)
The Government’s motion for leave to serve by publication and for
extension of time to effect service, docket no. 75, is GRANTED in part and DENIED in
part as follows. The Government may take the steps necessary to serve defendants
Brookline Properties, Financial Concepts, Ltd., and Goldstar Enterprises, Inc. by
publication. The Court makes no ruling, however, concerning whether the Government’s
efforts to personally serve such entities satisfy the prerequisites to service by publication
set forth in 28 U.S.C. § 1655, and the Government is encouraged to continue attempting
to locate and/or personally serve the individuals and/or entities at issue. Service must be
effected by December 31, 2018.

(4)
Gould’s motion to dismiss for failure to timely serve and/or failure to
prosecute, docket no. 77, is DENIED. Unless Gould acknowledges that he has an
12 ownership interest in Brookline Properties, Financial Concepts, Ltd., and/or Goldstar
Enterprises, Inc., he has no standing to raise a defense of untimely service on their behalf.
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(5)
The parties are DIRECTED to file a Joint Status Report, within fourteen
(14) days of the date of this Minute Order, indicating when they will be prepared for trial
14 in this matter and how long they anticipate trial will last.
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(6)
record.

The Clerk is directed to send a copy of this Minute Order to all counsel of

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Dated this 1st day of November, 2018.
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William M. McCool
Clerk

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s/Karen Dews
Deputy Clerk

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Government has not clarified whether any inquiry was made of Polinder concerning such files,
23 whether she still has custody of them, and, if so, whether she has produced them in discovery.
MINUTE ORDER - 2