Millie B. Heathman v. United States District Court for the Central District of California,respondent

503 F.2d 1032 Millie B. HEATHMAN et al., Petitioner, v. UNITED STATES DISTRICT COURT FOR the CENTRAL DISTRICT OF CALIFORNIA,Respondent. No. 74-1438. United States Court of Appeals, Ninth Circuit. Aug. 26, 1974. Melvyn B. Fliegel (argued) of Schwartz & Alschuler, Los Angeles, Cal., for petitioner. Jeffrey B. Lugash (argued), Los Angeles, Cal., for real parties in interest. Before CHAMBERS and DUNIWAY, Circuit Judges, and EAST, * District judge. OPINION DUNIWAY, Circuit Judge: 1 Petitioners, defendants in the trial court, apply for a writ of mandamus or prohibition directing the district court to vacate its order which requires defendants' accountants to deliver to the real parties in interest, plaintiffs in the trial court, copies of the income tax returns of Prudential Management Corporation and the San Diego Trust, together with accounting materials prepared for use in making the returns. On March 27, 1974, we stayed the district court's order. The petition raises issues concerning the scope of civil discovery, the resolution of which is necessary to prevent the potential irreparable loss of defendants' claimed rights. We therefore consider the merits of defendants' claims.…

(concurring and dissenting):

I concur in the result reached by the majority. A writ of mandamus is available only “if ordinary remedies are inadequate and there are present exceptional and extraordinary circumstances which require the issuance of an extraordinary writ to prevent a grave miscarriage of justice.” Hartley Pen Co. v. United States Dist. Ct., 287 F.2d 324, 328 (9th Cir. 1961). No such extraordinary circumstances are presented by this ease.

I dissent, however, from the views expressed by the majority. Even assuming, without deciding, that it has properly distinguished Baird v. Koerner, 279 F.2d 623 (9th Cir. 1960), its views concerning the discovery of federal tax returns are inaccurate.

Although the literal language of 26 U.S.C. §§ 6103 and 7213 prohibits the disclosure of only those tax returns in the government’s possession, the statutes should not be construed so narrowly. Statutes have both textual and contextual meaning. Where the wording of a statute does not express fully the policies underlying the statute, courts should “give it effect in accord with its design and purpose, sacrificing, if necessary, the literal meaning in order that *1036 the purpose may…

Petitioners, defendants in the trial court, apply for a writ of mandamus or prohibition directing the district court to vacate its order which requires defendants’ accountants to deliver to the real parties in interest, plaintiffs in the trial court, copies of the income tax returns of Prudential Management Corporation and the San Diego Trust, together with accounting materials prepared for use in making the returns. On March 27, 1974, we stayed the district court’s order. The petition raises issues concerning the scope of civil discovery, the resolution of which is necessary to prevent the potential irreparable loss of defendants’ claimed rights. We therefore consider the merits of defendants’ claims. Pacific Car and Foundry Co. v. Pence, 9 Cir., 1968, 403 F.2d 949, 951-953 ; Harper and Row Publishers, Inc. v. Decker, 7 Cir., 1970, 423 F.2d 487, 492 .

The contested discovery order was issued in the following context: Plaintiffs, California Professional Bureau and others, brought suit in the district court under the federal and state securities laws against petitioners and other defendants alleging the sale of securities- and real estate by improper, fraudulent and…