Hunter Biden’s lawsuit over the public disclosure of his tax return information will move forward after a federal judge finds that the IRS might be liable for the actions of two whistleblowers’ lawyers.

As Law&Crime previously reported, Biden sued the IRS in September 2023, alleging that two agents, Gary Shapley and Joseph Ziegler, “completely disregarded their confidentiality obligations” and engaged in a “campaign to publicly smear” Biden through “unauthorized” disclosures of tax return information to media outlets, resulting in an “assault” on his privacy rights.

President Joe Biden’s son argued that Shapley and Ziegler directed their lawyers to publicly share Biden’s tax information, and were therefore subject to laws against disclosure.

The federal agency filed a motion to dismiss in February, arguing that Biden failed to show the agency’s alleged lack of “safeguards” to prevent two whistleblowers and their attorneys from disclosing his “confidential tax return information” in media interviews caused him to suffer “actual damages.” Lawyers for the IRS also argued that sovereign immunity protects the IRS against lawsuits over disclosures made by nonemployees of the federal government — in this case, lawyers for Shapley and Ziegler.

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Baker McKenzie partner sues IRS for documents on partnership audit strategies

By Debra Cassens Weiss

March 20, 2024, 2:10 pm CDT

A lawsuit filed by a Baker McKenzie tax partner is seeking to compel the Internal Revenue Service to disclose documents about its tougher policies for auditing partnerships, other pass-through entities and their owners.

The March 18 suit filed by tax partner George M. Clarke says the IRS has not produced records in response to his Dec. 19 request under the Freedom of Information Act.

Law.com, Reuters and Law360 have coverage.

Among the documents sought is a paper discussed by its author, an IRS employee, at a November 2023 conference sponsored by the ABA Section of Taxation. An article about the employee’s remarks appeared in Tax Notes with the headline “IRS Taking Partnership Audits to New Level.”

The IRS is auditing 75 of the country’s largest partnerships and has sent compliance letters to 500 partnerships, according to the Tax Notes article attached to the complaint. The scrutiny is part of the agency’s increased focus on wealthy taxpayers.

Clarke says in the suit he wants to learn more about IRS practices, “so that I can better represent my clients.”