HomeMy WebLinkAboutMOTION TO PRECLUDE THE INTRODUCTION OF CERTAIN EXHIBITS AT THE HEARING1
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125110.0002/8345703.2
APPELLANT’S MOTION TO PRECLUDE THE
INTRODUCTION OF CERTAIN EXHIBITS - 1 LANE POWELL PC
1420 FIFTH AVENUE, SUITE 4200
P.O. BOX 91302
SEATTLE, WA 98111-9402
206.223.7000 FAX: 206.223.7107
BEFORE THE HEARING EXAMINER OF THE CITY OF RENTON
RE: TracFone Wireless, Inc. Administrative Appeal
TRACFONE’S MOTION TO PRECLUDE THE INTRODUCTION OF CERTAIN EXHIBITS AT THE HEARING ORAL ARGUMENT REQUESTED
I. INTRODUCTION
The City is attempting to include into the hearing record a series of exhibits that were
not part of the audit file and in many cases were prepared after the audit period assessment
was issued. TracFone moves that these records, intended to backfill and belatedly support
the conclusions of the audit after the fact be excluded from introduction at the hearing.
II. STATEMENT OF FACTS
The City Plans to Submit Exhibits that are not Part of the Audit File.
The City’s Initial List of Exhibits provided on September 21, 2020, lists a number of
documents that were not included in the TRS audit file, were not acquired until after the
assessment had been issued and/or were not relied upon in preparing the assessment. Ex. 2 to
Degginger Decl. They are described below:
1. Documents Produced by TracFone pursuant to Administrative Order issued June
19, 2019. Four months after the assessment was issued by TRS on behalf of Renton, the City
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125110.0002/8345703.2
APPELLANT’S MOTION TO PRECLUDE THE
INTRODUCTION OF CERTAIN EXHIBITS - 2 LANE POWELL PC
1420 FIFTH AVENUE, SUITE 4200
P.O. BOX 91302
SEATTLE, WA 98111-9402
206.223.7000 FAX: 206.223.7107
issued an Administrative Order seeking documents from TracFone. None of these documents
were reviewed in preparation of the assessment. They include the following documents:
A Reseller Agreement with AT&T dated October 23, 2007 (Document 13);
A Services Agreement with Sprint dated July 11, 2011 (Document 14);
A Purchase Agreement with T-Mobile dated September 4, 2009 (Document 15);
A Reseller Agreement dated March 29, 2005 (Document 16); and
Retail Distribution Agreements dated June 23, 2009 (Document 17).
None of these agreements were reviewed by Jan Hawn, the Administrative Services Director
responsible for issuing the final audit determination.1 Hawn Deposition at 63, ll. 10-16. Nate
Malone only looked at one agreement, TracFone’s contract with Rent-a-Center one of the
retail agreements, and stated that none of the agreements impacted the assessment.2 Malone
Deposition at 135, ll. 18-23.
2. Renton Tax Rule 242. This rule is listed as Exhibit 7 on the City’s preliminary
list. It purports to be an administrative rule prepared in 2016 that discusses application of the
City’s utility tax. It was not produced in the audit files of either TRS or the City. It was not
mentioned in any correspondence with TracFone. Nate Malone testified that he prepared the
Rule but admitted that the rule never has been formally adopted by the City—there never has
been a public hearing regarding the rule and it has not been adopted by the City Council.
Q: Sure. You had testified previously that although it says Rule 242, you made it
clear that this document, 242, has not been adopted by the City of Renton?
A: That’s correct.
1 Ms. Hawn was asked: “”Did you review any of the exhibits, any of the documents that TracFone was asked to
provide to the City after the audit was completed? Answer: “Are you referring to the doucments that were
requested from the administrative order?” Question” “Yes”. Answer: “I did not.”
2 Mr. Malone was asked: ”We talked earlier about the documents that wee requested from TracFone. Did you
review any of the documents that you received? Answer: “ Pertaining to the agreements with retailers and—
“Question: “Yes”. A.” Yes, I did” Question: “”Which ones did you review? “ Answer: “I looked mostly in-
depth at the Rent-A-Center agreement. It had the most content. The remaining retailer agreements were more
boilerplate agreements from the look of it.” Question: “Did you look at any other that you had—in a way—in
sufficient detail that you relied on it for anything involving this assessment?” Answer: “I—I mean, I looked at
the remainder, but I don’t think that there was anything of content that would have impacted this assessment. “
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125110.0002/8345703.2
APPELLANT’S MOTION TO PRECLUDE THE
INTRODUCTION OF CERTAIN EXHIBITS - 3 LANE POWELL PC
1420 FIFTH AVENUE, SUITE 4200
P.O. BOX 91302
SEATTLE, WA 98111-9402
206.223.7000 FAX: 206.223.7107
Q: So it can’t be relied upon as authority, if you will, for applying—for using it in
connection with an assessment?
A: This rule does not have any statutory authority and has not been adopted as a
formal rule.
Malone deposition at 125-27. As a result it cannot be admitted or relied upon in this case.
Its introduction clearly would be more prejudicial than probative.
3. TracFone Terms and Conditions. This document is listed at number 18 on the
City’s initial exhibit list. The City obtained from the TracFone website a summary of terms
and conditions. It introduced the document as Exhibit 74 to the Deposition of Chesley Dillon
and was dated July, 2019. Edwards Decl., Dillon Deposition at 30. They were not produced
in the audit file and not relied upon in preparing the assessment. Because it cannot be
established that these were the terms and conditions in effect during the audit period, the
document should not be introduced.
4. TracFone Marketing Materials. This document is listed as number 19 on the
City’s exhibit list. Mr. Malone from the City obtained several marketing brochures last year.
Edwards Decl., Dillon Deposition at 17. These, too, were not part of the audit file, and were
prepared after the audit period. Thus they should not be admitted.
5. TracFone Wireless Basic Phone Card. This document is listed as Number 20 on
the City’s exhibit list. Mr. Malone testified that he purchased this card in October 2020.
Malone deposition at 95, ll. 12-15. Neither the card nor any information on the card was
relied upon in preparing the Assessment or issuing the final assessment.
III. EVIDENCE RELIED
1. Respondent’s Preliminary Witness and Exhibit List;
2. Excerpts from the Depositions of Jan Hawn and Nate Malone attached to the
Declaration of Grant Degginger;
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125110.0002/8345703.2
APPELLANT’S MOTION TO PRECLUDE THE
INTRODUCTION OF CERTAIN EXHIBITS - 4 LANE POWELL PC
1420 FIFTH AVENUE, SUITE 4200
P.O. BOX 91302
SEATTLE, WA 98111-9402
206.223.7000 FAX: 206.223.7107
3. Excerpts from the Deposition of Chesley Dillon, attached to the
Declaration of Scott Edwards.
IV. ARGUMENT
The City Must be Precluded from Backfilling the Record with Documents that were
Not Relied Upon in Issuing the Audit.
It is inappropriate for the City to supplement or backfill the record after the
assessment has been issued. Towle v. Washingotn State Dept. of Fish & Wildlife, 94 Wash.
App. 196, 205, 971 P.2d 591, 595 (1999). (Re-opening record to consider additional
evidence was error); Nevler v. State Employment Security Department, 2 Wash.App.2d 1008
(2018) (“A reviewing officer cannot take additional evidence outside the record.”) see also
RCW 34.05.464(5).
It is clear that neither TRS nor the Administrative Director relied upon any of the
resller agreements between TracFone and the wireless companies or the agreements between
TracFone and any of the third party reseller to whom TracFone sold airtime at wholesale.
The same can be said for the marketing materials, the information on the TracFone web site
in 2020 and the card that Mr. Malone purchased in 2020. None of these documents were in
the TRS audit file, the City’s audit file nor were they relied upon in preparing the February
2019 assessment or the final assessment in October 2019.
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125110.0002/8345703.2
APPELLANT’S MOTION TO PRECLUDE THE
INTRODUCTION OF CERTAIN EXHIBITS - 5 LANE POWELL PC
1420 FIFTH AVENUE, SUITE 4200
P.O. BOX 91302
SEATTLE, WA 98111-9402
206.223.7000 FAX: 206.223.7107
V. CONCLUSION
For the forgoing reasons, TracFone respectfully requests that the exhibits listed above
be excluded from the hearing.
DATED: January 29, 2021.
LANE POWELL PC
By Scott M. Edwards, WSBA No. 26455 edwardss@lanepowell.com Grant S. Degginger, WSBA No. 15261 deggingerg@lanepowell.com Attorneys for TracFone Wireless, Inc.
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125110.0002/8345703.2
APPELLANT’S MOTION TO PRECLUDE THE
INTRODUCTION OF CERTAIN EXHIBITS - 6 LANE POWELL PC
1420 FIFTH AVENUE, SUITE 4200
P.O. BOX 91302
SEATTLE, WA 98111-9402
206.223.7000 FAX: 206.223.7107
CERTIFICATE OF SERVICE
I hereby certify under penalty of perjury of the laws of the State of Washington and the
United States that, on the date listed below, I caused to be served a copy of the attached
document to the following persons via electronic mail:
Kari L. Sand Ogden Murphy Wallace P.L.L.C. 901 Fifth Avenue, Suite 3500 Seattle, WA 98164 ksand@omwlaw.com Cynthia Moya Renton City Clerk 1055 So. Grady Way Renton, WA 98057 cmoya@rentonwa.gov olbrechtslaw@gmail.com
Executed on the 29th day of January, 2021, at Seattle, Washington.
s/ Norma Tsuboi Norma Tsuboi, Legal Assistant