Federal judge sides With Coin base customer Against IRS | Today 21/july/2017

A federal judge has ruled in favor of an anonymous customer of the bitcoin exchange Coinbase against the Internal Revenue Service, permitting the unnamed bitcoiner to challenge the agency’s summons and proceed with their case anonymously.

      Judge Sides With “John Doe 4”

U.S. Magistrate Judge Jacqueline Corley of the Northern District of California has ruled in favor of Coinbase customer known as “John Doe 4” against the Internal Revenue Service (IRS). In the 12-page court order, the judge grants Doe 4’s “motions to intervene as of right and permissively.” These interventions are provided for by Federal Rules of Civil Procedure 24. Fortune summarizes:

" The judge agreed to let an anonymous customer, known only as “John Doe 4,” challenge the IRS’s power to enforce a sweeping summons it served on the San Francisco-based Coinbase last year for customer records. "

         The Case of John Doe 1, 2, 3 and 4

The case began on November 17, 2016 with the IRS’s petition to serve a “John Doe” administrative summons on Coinbase Inc, which was granted on November 30, 2016.

The following month, Coinbase customer Jeffrey K. Berns filed a motion to intervene and quash the summons, prompting the agency to withdraw its request for his information. In early January, Coinbase then moved to intervene and quash the summons, or for a protective order limiting its scope. In May, Coinbase customers, known anonymously as John Doe 1, 2 and 3, also filed motions to intervene and quash the summons.

This month, the IRS filed a notice that it “had narrowed the documents it seeks to obtain via the summons,” the court document describes.

In Tuesday’s court order, “The court grants the stipulation to substitute Doe 4 for Doe 1 and 2 and to permit John Doe 4 to proceed anonymously.” In addition, the IRS no longer seeks records belonging to Doe 1 and 2. While Doe 4’s Coinbase records are covered by the narrowed summons, Doe 3 has not offered any evidence that his records are covered by the narrowed subpoena so his motion to intervene is denied without prejudice.

From the beginning, the agency’s investigation “has drawn fire from Coinbase and others who claim the agency’s demands ensnare too many people and involve too much information,” Fortune described, adding that:

"In her ruling, U.S. Magistrate Judge Jacqueline Corley strongly agreed, and declared the scope of the IRS request is unprecedented."

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