Heinz Noonan, the ‘Bearded Holmes’ of the Sandersonville Police Department, was enjoying a pleasant afternoon of schadenfreude, the joy that comes from relishing the misfortune striking someone else. The Sandersonville Commissioner of Homeland Security had prematurely announced the successful completion of an undercover operation involving ‘foreign miscreants’ who were working to foul the drinking waters of Sandersonville. The problem: there was no fouling of the drinking waters of Sandersonville. The fouling of the drinking waters had been in Jacksonville, a far cry and far city from Sandersonville.
However, rather than backtrack, the Commissioner had covered his political behind by stating the operation to which he was alluding was ‘ongoing’ and he could provide no other details because the operation was ‘under cover.’ When asked by the press how he could reveal an ‘undercover operation’ to the press and, at the same time, have the ‘under cover undercover operation remain undercover,’ the Commissioner stated he had no comment as the “under cover undercover operation was still under cover and to reveal any information of an undercover operation while it was still under cover was a violation of both State and Federal law.” When he could not provide chapter and verse of both the “State and Federal law,” he had stated he would “get back with the press at an appropriate moment.”
While Noonan was chuckling to himself, Harriet, the office manager and Il Duce of Common Sense, came into his office with a questioning look.
Noonan was quick to pick up the impending difficulty. “Oh, no! What evildoer is calling now?”
“Well, it is certainly an evildoer. It’s a lawyer. And you will love the tête-à-tête you are about to have.”
“OK. Why?”
“It’s a case where a lawyer is suing herself.”
“Really? You can do that?”
“I don’t know,” Harriet said as she pointed at the phone. “It is, as they say on every game show, a million-dollar question. Really. And the answer is …” she paused in a game show voice as she pointed at his desk phone, “…on Line 2.”
“Noonan.”
“Is this the ‘Bearded Holmes,’ because I really need him.”
“I’ve been called that. Who’s this?”
"Jennifer Sanchez Fitzsimmons, I'm a paralegal in Sioux Falls, Idaho, and I really need some help."
“I’m here to serve. What’s the problem?”
“I don’t think you’ll believe me. This is not a crank call.”
“Try me.”
“We have a case in the local court with a litigant who is suing herself. Worse, she could win. She’s a very clever lawyer and her intent, we believe, is devious far beyond our capacity to appreciate.”
"That's a mouthful, Ms. Fitzsimmons," Noonan said as he dug for a notebook on his desktop. When he finally found a pen as well, he continued. “Let’s start from the beginning.”
“Oh,” said Fitzsimmons said with relief, “I’m glad you believe me.”
“So far so good.”
There was a long pause on the other end of the line, the hard-line to Noonan's office phone, not the electronic beast of Satan he was required to have on his person at all times. Finally, Fitzsimmons said, “Are you familiar with the case of Robert Lee Brock?”
“Sorry.”
“An odd case. Legally, that is. Humorous if it wasn’t an actual case that was filed.”
“I’m listening.”
“Robert Lee Brock is an inmate in the Indian Creek Correctional Center in Virginia. He’s been and continues to be a pain in legal back pockets. He's filed case after case after case pro se and they have all been deemed frivolous. But the court can’t say ‘no,’ so, as far as I know, Brock is still filing frivolous complaints.”
“OK.”
“The reason I am calling you is because of one particular frivolous suit. In 1995, a while back, he sued himself.”
“Really? I didn’t know you could do that.”
“Well, he did. But wait, it gets more convoluted. He claimed in his filing, alcohol caused him to commit his crimes which was a violation of his religious principles.”
“I’m sure there is more coming.”
“You got it.”
"He sued himself for $5 million. Then, since he was, and I quote, "a ward of the state," he could not earn money so he wanted the State of Virginia to lend him the $5 million and he would repay the State after he got out of prison. In 23 years.”
Noonan chuckled, “How gracious of the fellow.”
“You are correct. The judge tossed the suit as frivolous. But …”
“I hate it when someone says ‘but’ because that means there is a lot more to come.”
"You are correct. Which is the reason I'm calling you. A shrewd lawyer here in Sioux Falls is going Robert Lee Brock one better.”
“How’s that?”
“Here’s what we know. The woman is fairly wealthy so she has established a number of businesses. LLCs if you know they are.”
“’Limited Liability Corporations.’”
“Correct. Apparently she is doing well in all LLCs and, we believe, is looking to generate expenses on all her books that do not exist.”
Noonan shook his head sadly. “Welcome to the world of accounting. Let me guess, she is letting some of her LLCs sue other LLCs so whatever losses are incurred are tax write-offs.”“You got it. We don’t know that is what is going to happen. We are just guessing. Our problem is we do not want her to succeed because if she does, there will be a flood of similar cases.”
“What does the IRS say?”
“Captain! You know the court does not speak to the IRS! We just have to hope someone comes up with a solution to our, er, dilemma.”
“Let me see what I can come up with.”
It could never be said Noonan was a master of the courtroom. He was not. In fact, the only experience he had in a courtroom was as an expert witness. Contrary to programs like NCIS and LAW AND ORDER, there are not many moments when expert witnesses are actually called to court. Their reports are in the court record and when there was a dispute, it was over what was written, rather than browbeating the individual who wrote the report. His experience with lawyers was even rarer. The only times he had been in the presence of a lawyer – twice – was to establish a trust and to sign a living will.
When it came to taxes, Noonan knew even less. He itemized in the sense he kept receipts and added them up for his tax accountant. Then, like most Americans, he signed his income tax statement with very little understanding of what the numbers were. If and when the IRS ever came knocking, he’d show them the receipts he had and say, “Go for it!” And, frankly, for the money he earned there was very little cheating he could do. Looking up the legality of an LLC did little to clear up the matter. By definition, an LLC was a business structure offering personal liability protection for a corporation and pass-through taxation for a proprietorship or partnership. It was the simplest legal way to protect personal assets just in case there was a chance of the business being sued. In other words, there was a fiscal wall between a person and the person’s business even if they were, basically, the same.
When he dove into the world of tax deductions it was like swimming in an ocean of details all of which were duplicitous. Some expenses were legitimate but, at the same time, not. For instance, buying real estate for yourself was not tax deductible but if you bought the same piece of property as a business it was. Did that include an LLC? Civil and criminal charges were not deductible if you were an individual but were if you were a business. Again, did that include – or not – LLCs? The same with personal injuries and property claims.
Conflict of interest rules were equally nebulous. In most cases, an attorney could not represent two people suing each other. The same law firm could represent two litigants suing each other as long as there was some manner of legal wall between the lawyers in the same firm actually representing the two, competing individuals. To do otherwise was a conflict of interest. But, as in all things legal, there was a catch. The same lawyer could represent two competing parties if both parties signed off on a conflict of interest disclosure.
A dull, distant gong chimed in the recesses of Noonan’s cerebral cavity.
Two weeks later, Harriet came into Noonan’s office with a letter and a small box. Noonan was in the process of feeding his fish, a thankless task in the sense the fish never said thanks. They never asked for food either so, in Noonan’s mind, that made it even. He was putting away the high-priced, exotic, imported fish food when he noticed Harriet sitting in the empty – formerly empty – chair beside his desk. He pointed to the envelope and box and shook his head comically. “What fresh hell and you bringing me this morning?”
Harriet waved the envelope. “Just a ‘thank you’ from that loo-loo call you got a while back. The one where the lawyer was suing herself.”
“Ah, the duplicating, litigating litigant.”
“Clever. And alliterative.”
“I didn’t know you knew what alliteration was.”
“I don’t. An alternate life form inserted that line in my brain. Now, how did you solve the, how did you say it, duplicating, litigating litigant?”
“Just a guess. Some advice.”
“I’m all ears. Just like Ross Perot.”
“I don’t know what was done. All I did was give a suggestion.”
“Which was?”
“Twofold. My suggestion was to find the defendant guilty. Whoever the defendant was in the case.”
“Guilty?!”
“Sure. Then fine the defendant $1. That way the duplicating, litigating litigant has a win. You cannot appeal a win. So that ends the case.”
“So you cannot appeal a win?”
“Don’t think so. Anyway, she can always bring another one. I mean, the point of suing yourself, so to speak, is to drive up phony legal expenses on both sides of the issue. That’s why she was representing both the plaintiff and the defendant.”
“I didn’t know you could do that.” Harriet twisted her head to the side.
“You are correct – and not. The point of the lawsuit was to run up legal expenses for both plaintiff and the defendant. And no, it is not illegal for the same attorney to represent both parties as long as both parties agree to it.”
“But she was ‘both parties,’ so to speak. So, on paper, she was plaintiff, defendant and lawyer for both sides of the trial.”
“Correct.”
“And that was legal?”
“Apparently.”
“So, what was so clever about the advice you gave?”
“I didn’t say it was clever. I just said it was a ‘suggestion.’”
“Oh, really. So tell me, oh ‘Bearded Holmes’ how that solved the problem of another case just like the first one popping up?”
“Ah, Harriet, you use subtlety. I suggested the court say no court costs would be assessed which dropped all of the legal expenses of both parties – plaintiff and defendant – back on the litigants, so to speak.”
“But wasn’t that the whole point of the trial in the first case? To run up legal costs,” Harriet made quote marks in the air when she said, ‘legal costs?’
“Correct. That dumped the legal costs back on the duplicating, litigating litigant. But there was a catch. See, she established her LLCs to protect her personal liability. The key word here is personal. You cannot write off personal tax issues. So she ran up legal expenses that did not exist for tax purposes when, at the end of the matter, she could not write off the legal expenses anyway.”
“But couldn’t she file the legal expenses off on her LLC’s taxes?”
“Could but she should be careful. The IRS might call it fraud and no one in their right mind wants to mess with the IRS. Besides, I was asked to guide the court, not give tax advice. The $1 win forces the duplicating, litigating litigant to argue with the IRS, not the court.”
“Clever. And, as a matter of fact,” Harriet said as he waved the box she had in her hand. “You got a delivery from the duplicating, litigating litigant.”
“Really? Odd. What was in it?”’
“Nothing.”
“Nothing?”
“Just a note. It said, ‘Thanks for nothing.’”
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