Bid for Jury Trial Fails in Microcaptive Promoter Penalty Suit

A Pittsburgh firm accused of promoting shady microcaptive insurance deals can’t assert a Seventh Amendment right to a jury trial despite a recent US Supreme Court decision.

HDH Group Inc’s attempt to dismiss government counterclaims in its lawsuit over the “promoter penalties” the government assessed it under IRC Section 6700—which are aimed at taxpayers that promote tax shelters, and are more severe than for a regular misstatement of tax—was rejected Tuesday by the US District Court for the Western District of Pennsylvania.

The company cited the recent ruling in SEC v. Jarkesy to argue that the Seventh Amendment requires ...