Catherine Rusoff
Two IRS employees who received whistleblower protections for sharing their concerns about the administration’s alleged mishandling of the Hunter Biden investigation are asking a federal judge to dismiss a civil lawsuit filed by the president’s son against the federal tax agency.
Those whistleblowers, Gary Shapley and Joseph Ziegler, also asked to intervene in the matter, arguing that the IRS has a conflict of interest in trying to defend its decision to speak publicly and to Congress about its experience investigating the president’s son.
“The Whistleblower Protection Act gave them the right to discuss with the media information that they believed constituted serious mismanagement and an abuse of authority, such as the mishandling of the Hunter Biden case,” lawyers for the two agents state in arguments presented to a federal judge. Friday.
The civil lawsuit in question was filed by Hunter Biden in September against the IRS, alleging that Shapley and Ziegler were part of a “campaign to publicly defame” the president’s son by releasing confidential taxpayer information about him. The lawsuit does not name Shapley and Ziegler as defendants.
“IRS agents targeted and sought to embarrass Mr. Biden through public statements to the media in which they and their representatives disclosed confidential information about a private citizen’s tax matters,” the lawsuit alleges.
The case, which is still in its early stages, offers no explicit role for Shapley and Ziegler to defend their decision to speak publicly, including on CBS News, about their remarks during a lengthy criminal tax investigation into Hunter Biden. That criminal case is scheduled to go to trial in June. Instead, it is up to the IRS to defend the two whistleblowers’ decision to speak publicly.
In two separate motions filed Friday, the veteran IRS agents argue that they should be allowed to participate in the case to defend their actions and that the case should be dismissed.
“Shapley and Ziegler have a significant concrete interest in the outcome of this action: in their careers, in their reputations, and in defending against adverse collateral consequences,” a motion reads.
The two defend their dismissal by claiming that they were careful to avoid identifying any confidential taxpayer information and that when they disclosed information about Hunter Biden, they did so in a manner protected by Congress and whistleblower statutes.
The Justice Department declined to comment when asked about the records on Friday. Neither the IRS nor Hunter Biden’s lawyers have yet presented any formal response to the two agents’ requests. It will be up to U.S. District Court Judge Rudolph Contreras to determine whether they can intervene, after Biden and the IRS respond to the requests.
A year ago, Shapley came forward in an interview with CBS News to raise questions about what he claimed was special treatment in the investigation of the president’s son, telling CBS News that since the Trump administration he has been repeatedly blocked from taking measures in the IRS investigation he would have considered routine in other cases.
“We have to make sure as the IRS Criminal Investigative Special Agent that we treat every person exactly the same,” Shapley, a 14-year veteran of the agency, told CBS News at the time. “And that just didn’t happen here.”
The Justice Department denied that Hunter Biden received favorable treatment.
Hunter Biden’s legal team did not respond to a request for comment.
There are strict laws governing the need for confidentiality in how IRS employees handle taxpayer information. At the time of his first interview with CBS News in May, Shapley and his lawyers told CBS News they were taking great care in making the decision to speak publicly.
Biden’s lawsuit against the IRS cites specific statements made by Shapley and an attorney at the time. It alleges that during interviews on April 19 and May 24, Shapley and attorney Mark Lytle — who is not named in the lawsuit — publicly disclosed the existence of the investigation without Hunter Biden’s consent. And the suit claims that during an interview with CBS News on June 28, Shapley made comments that revealed confidential information about Hunter Biden’s taxes and finances. The whistleblowers dispute both allegations.
IRS lawyers argued in filings last week that part of the case should be dismissed because citizens working on behalf of IRS agents are not covered by tax privacy provisions. The government also argued that disclosures are permitted if an IRS agent believes that “such return or return information may be related to possible taxpayer misconduct, mismanagement, or abuse.”
In motions filed Friday, the two agents challenge the IRS’s failure to seek an outright dismissal of the lawsuit — opting instead to seek dismissal of the claims based on alleged disclosures made by non-IRS employees such as Shapley’s lawyer. They argue that the IRS – as the target of whistleblower complaints – is not in a position to defend the agents’ actions.
“The conflicts of interest could not be clearer,” they write.
Hunter Biden’s lawsuit seeks $1,000 for “each act of unauthorized disclosure” as well as an unspecified amount of punitive damages.
