Judicial Watch: IRS Produces Recovered Lerner Emails

(Washington, DC) – Judicial Watch released 906 pages of newly recovered Lois Lerner emails from the IRS that are believed to recently have been recovered by the IRS’ internal watchdog – the Treasury Inspector General for Tax Administration (TIGTA).  The IRS released the emails under a court order by U.S. District Court Judge Emmet Sullivan.  The new documents show that Lois Lerner and other top officials in the Exempt Organizations Unit of the Internal Revenue Service (IRS), including soon-to-be Acting IRS Commissioner Steve Miller, closely monitored and approved the controversial handling of tax-exempt applications by Tea Party organizations.  The documents also show that at least one group received an inquiry from the IRS in order to buy time and keep the organization from contacting Congress.

At July 1, 2015, status conference, Judge Sullivan ordered the IRS to begin producing, every week, the nearly 1,800 newly recovered Lois Lerner emails responsive to Judicial Watch’s Freedom of Information Act (FOIA) request.   Despite the court order, the IRS did not produce any Lois Lerner emails until July 15.  The IRS also failed to provide Judicial Watch a status report of the Lois Lerner email production issues, as also ordered by Judge Sullivan.  Last week, Judge Sullivan ordered sua sponte the parties to appear for a status hearing for tomorrow (July 29) shortly after Judicial Watch raised concerns about the IRS’ failure to comply with his orders to release the newly discovered Lerner emails and status updates on its production of previously “missing” documents.

The developments come in Judicial Watch’s FOIA lawsuit seeking documents about the Obama IRS’ targeting and harassment of Tea Party and conservative opponents of President Obama (Judicial Watch, Inc. v. Internal Revenue Service (No. 1:13-cv-01559)).  Judicial Watch’s litigation forced the IRS first to admit that Lerner’s emails were supposedly missing and, then, that the emails were on IRS’ back-up systems.

The documents show that Exempt Organizations Director Lois Lerner, sent a November 3, 2011, email documenting her concerns about the failure to process applications in a timely manner:

I’m getting a little nervous about the amount we have on our plate and how we are handling. I know everyone is working hard and juggling, but I am wondering whether the juggling decisions are being made holistically enough. We have only so many resources and things will probably get worse going forward. I worry that decisions about how to use the resources are being made without all the information…Something that may not seem important in Cincinnati, may be crucial in DC. Similarly, DC may be prioritizing its work based on what is sitting in DC when something sitting in Cincinnati should be the focus of DC work.

IRS Program Manager Cindy Thomas of the Cincinnati Exempt Organization office replied to Lerner a few hours later with an email detailing the pressure caused by the IRS’ Washington headquarters failure to move on the “advocacy cases.”  Thomas warned of litigation and admitted that she authorized a letter for more information that was sent to one of the complaining groups to keep it from contacting Congress:

The backlog of work involves advocacy organizations. As of about a month ago, there were 161 of these cases sitting idle and we probably have more by now. The control dates for these cases go back to the end of 2009 and all through 2010. We’ve been waiting for EO in D.C. to get us a guidance/reference document with lessons learned from the c4 and c3 cases they worked and coordinated with Judy Kindell and Counsel. We’re getting calls from POAs wanting to know who has put the halt on working these cases and threatening to contact their Congressional offices.  Just today, I instructed one of my managers to get an additional information letter out to one of these organizations — if nothing else to buy time so he didn’t contact his Congressional Office.  Soon, we’re going to start getting TAO’s [Taxpayer Assistance Orders] from TAS [Taxpayer Advocate Service] or declaratory judgment cases filed —- then, I guess everyone will decide its time to start moving the cases when we have mounds of additional paperwork to process along with the cases (adding even more work for us to do).

Another IRS lawyer responded to Lerner’s email with an admission that IRS’ D.C. headquarters legal staff had hundreds of cases backlogged.  Michael Seto, who headed the Exempt Organization Technical Unit, acknowledged to Lerner on November 9, 2011, that there were 446 application cases open beginning of fiscal year 2012, with many open for more than two years.

The emails also show that Lerner and other top officials of the IRS were aware of complaints about treatment by Tea Party groups.  In response to a February 2012 complaint and request for briefing from Rep. Jim Jordan (R-OH) with the House Oversight and Government Reform Committee about, according to the IRS, a Tea Party an organization that applied for exemption about 18 months previously and only “just recently” heard anything about the status of its application:  “When it did finally hear from us, we [the IRS] apparently asked some fairly detailed questions and gave the organization a short deadline to respond.”

Miller, who was then-IRS Deputy Commissioner for Service and Enforcement, emailed:  “let me know if it’s a taxpayer I should know about.”  He also complained about the number of emails about the issue, writing:  “Will the emails never stop?”  Miller became Acting Commissioner for the IRS later in the year and was eventually forced out after the Obama IRS scandal became public in May 2013.

Lerner handled the subsequent briefing of Rep. Jordan, and a statement by the IRS in response did not mention backlogs, Tea Party targeting, or Lerner’s own concerns about the nature of the questions the IRS was sending to Tea Party applicants.

Another email shows that Miller delayed “guidelines” for handling the backlogged applications the very week after Lerner’s briefing of Rep. Jordan.  This same email chain, dated February 28, shows that Lerner, in a response to a complaint from Sen. Mitch McConnell’s (R-KY) office about Tea Party application delays, Lerner admits:  “this is a very sensitive area.”

“These recovered Lois Lerner emails had to be dragged out of the Obama IRS, which is still resisting a federal court order requiring disclosure of Lerner’s ‘lost’ emails,” said Judicial Watch President Tom Fitton.  “This material shows that the IRS’ cover-up began years ago.  We now have smoking-gun proof that top officials in the Obama IRS unlawfully harassed taxpayers just to keep them from complaining to Congress about IRS’ targeting and abuse.  No wonder the Obama IRS has had such little interest in preserving or finding Lois Lerner’s emails.”