United States v. Sam Ellis Stores, Inc.
Opinion
Opinion
Gilliam, J.
MEMORANDUM DECISION AND ORDER
The defendant’s motion for reasonable litigation costs came on for hearing April 1, 1991. At that time, the defendant’s motion for reasonable litigation costs was taken under submission.
Having considered all pleadings, declarations and the written and oral arguments of counsel and law in support thereof, the court hereby grants the defendant’s motion for reasonable litigation costs.
FACTS
The defendant operates a retail store in Calexico, California, near the Mexican border. A large part of the business is conducted in pesos. The United States brought suit to recover a refund of taxes as a result of losses reported on the defendant’s federal income tax return for the year ending June, 1983. The loss, $441,-330, was allegedly due to the sale of merchandise in pesos and the declining value of the peso during 1983.
The Government’s complaint stated that the loss was a purported loss, and the defendant was not entitled to loss deductions in the amount of $441,300. The interrogatories, the Internal Revenue Service (“I.R.S.”) auditor, and the Government’s Memorandum of Facts and Contentions of Law focused on the amount of the losses, and raised no…