                            RECOMMENDED FOR FULL-TEXT PUBLICATION
                                 Pursuant to Sixth Circuit Rule 206
                                        File Name: 06a0085p.06

                     UNITED STATES COURT OF APPEALS
                                    FOR THE SIXTH CIRCUIT
                                      _________________


                                                    X
                               Plaintiff-Appellee, -
 UNITED STATES OF AMERICA,
                                                     -
                                                     -
                                                     -
                                                         No. 05-5080
        v.
                                                     ,
                                                      >
 MONUMENTAL LIFE INSURANCE COMPANY,                  -
                            Defendant-Appellant. -
                                                    N
                      Appeal from the United States District Court
                   for the Western District of Kentucky at Louisville.
                  No. 01-00014—Jennifer B. Coffman, District Judge.
                                     Argued: February 2, 2006
                                Decided and Filed: March 3, 2006
                 Before: MERRITT, MARTIN, and GILMAN, Circuit Judges.
                                        _________________
                                             COUNSEL
ARGUED: Kevin L. Smith, HINES, SMITH LLP, Costa Mesa, California, for Appellant. John A.
Dudeck, Jr., UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee.
ON BRIEF: Kevin L. Smith, HINES, SMITH LLP, Costa Mesa, California, David B. Tachau,
Kevin M. Norris, TACHAU, MADDOX, HOVIOUS & DICKENS, Louisville, Kentucky, for
Appellant. John A. Dudeck, Jr., Frank P. Cihlar, UNITED STATES DEPARTMENT OF JUSTICE,
Washington, D.C., for Appellee.
                                        _________________
                                            OPINION
                                        _________________
        RONALD LEE GILMAN, Circuit Judge. Monumental Life Insurance Company appeals
from the district court’s order enforcing an administrative summons issued by the Internal Revenue
Service (IRS). The summons requested voluminous documents from Monumental, a third party in
the IRS’s investigation of Johnson Systems, Inc. On appeal, Monumental argues that the district
court erred in rejecting the magistrate judge’s findings that (1) the IRS already had in its possession
many of the documents requested, and (2) the IRS’s summons was overbroad in that it sought
documents not relevant to the investigation of Johnson. Monumental also contends that, even if we
were to affirm the district court’s decision, a protective order should be imposed upon any
proprietary materials that Monumental is required to provide to the IRS. For the reasons set forth
below, we REVERSE the judgment of the district court and deny enforcement of the IRS summons.



                                                  1
No. 05-5080           United States v. Monumental Life Ins. Co.                              Page 2


                                       I. BACKGROUND
        In November of 1999, the IRS served a third-party summons on Monumental in the civil
investigation of Johnson’s tax liability for the tax years from September 30, 1994 through
September 30, 1997. The investigation focused on whether Johnson had properly taken income tax
deductions for the contributions it made to its employee welfare benefit plan. Johnson’s plan used
employer contributions to purchase three different Monumental life insurance products for its
employees: (1) the Continuous Group Term product (C-Group), (2) the Millennium Group 5 product
(MG-5), and (3) the Signet 24 Group Life Insurance product.
        John Marien, an IRS agent who specializes in investigating improper uses of employee
benefit plans, explained in an affidavit that these types of insurance arrangements can be
characterized as employee welfare benefit plans, deferred-compensation plans, or vehicles that hold
assets for select employees. The classification of the insurance arrangement affects the tax
consequences that attach. These arrangements are often used to disguise tax-avoidance schemes.
Marien believed that the same types of life-insurance products provided by Monumental to Johnson
were involved in the case of Neonatology Associates, P.A. v. Commissioner, 115 T.C. 43 (2000),
aff’d, 299 F.3d 221 (3d Cir. 2002). In that case, the Tax Court held that the contributions made by
two professional medical corporations into an employee benefits program were disguised taxable
dividends and not deductible expenses by the employer. 299 F.3d at 231-33.
        Employers are not generally prohibited from funding term life insurance policies for their
employees and deducting the premiums paid as business expenses. The magistrate judge explained,
however, that an “unlawful twist” occurs when small businesses, in which the employees are
generally the owners, buy term-insurance policies at inflated premiums and then place the amount
in excess of the reasonable cost of the insurance risk into an investment account for the employees.
In those cases, employers are disguising investments that accumulate cash value as deductible
benefit-plan expenses.
        To investigate whether Johnson’s deductions exploited this unlawful twist, the administrative
summons requested 172 categories of documents, including subparts, from Monumental. A copy
of the summons is appended to this opinion. Some of the document requests related specifically to
Johnson’s insurance policies, while others related generally to the C-Group and MG-5 products that
Monumental offered to many of its customers. For example, item 3(a) of the summons sought, in
relation to Monumental’s C-Group product, “[a]ll documents memorializing, describing, identifying
and/or listing the insurance costs and/or premium rates in effect during the period beginning July
1, 1991 through September 30, 1999.” This request, covering all of Monumental’s customers who
used the C-Group product during the time span identified by the IRS, was intended to better inform
the IRS about how the product was generally administered by Monumental. Marien claimed that
this information would help determine whether Johnson was deducting the proper amount as a
business expense.
        Monumental moved to quash the summons. After the district court dismissed Monumental’s
motion, Monumental delivered approximately 350 pages of documents to the IRS. Monumental also
expressed a willingness to produce more documents if the IRS would place them under a protective
order to keep the proprietary information confidential. This the IRS was unwilling to do. Moreover,
the IRS was displeased with Monumental’s production of an insignificant portion of the requested
documents, so it filed a petition to enforce the summons in April of 2001. Attached to this petition
was Marien’s affidavit. Marien averred that Monumental’s full compliance with the summons
would assist the IRS in characterizing the arrangements made by Johnson in order for the IRS to
determine the tax consequences. In addition, he declared that the documents sought by the summons
were not already in the possession of the IRS in a form useable to investigate Johnson.
No. 05-5080           United States v. Monumental Life Ins. Co.                                Page 3


         Monumental raised several objections to the enforcement of the summons, prompting the
district court to refer the case to a magistrate judge. In August of 2003, after lengthy proceedings
that included six hearings, further production of documents by Monumental, and an attempted
settlement between the parties, the magistrate judge issued his findings of fact, conclusions of law,
and recommendations. The magistrate judge concluded that (1) the summons did not suffer from
technical difficulties, (2) the IRS did not issue the summons in bad faith, (3) the government already
had a portion of the requested documents in its possession because of the Neonatology investigation,
and (4) some of the documents that the government requested were irrelevant to the investigation.
Because the magistrate judge did not believe that partial enforcement of the summons was legally
permissible, he recommended that the district court deny enforcement in full. He also recommended
that the district court not require a protective order, if the summons were to be enforced, because
placing a condition on the enforcement of an IRS summons is improper according to the Ninth
Circuit decision in United States v. Jose, 131 F.3d 1325, 1329 (9th Cir. 1997).
        The government then filed an objection to the magistrate judge’s recommendation. In
October of 2004, the district court declined to follow the recommendation of the magistrate judge
and entered an order enforcing the summons in full. The district court, applying a de novo standard
of review, rejected the conclusions of the magistrate judge that some of information sought by the
IRS was irrelevant and that the IRS possessed some of the documents requested in a form that it
could use in the Johnson investigation. Monumental now appeals.


                                          II. ANALYSIS
A.     Standard of review
        A district court’s order enforcing an IRS summons will not be reversed unless clearly
erroneous. Wagenknecht v. United States, 22 F. App’x 482, 483 (6th Cir. 2001) (unpublished)
(citing Fortney v. United States, 59 F.3d 117, 119 (9th Cir. 1995)). Clear error exists if we are “left
with the definite and firm conviction that a mistake has been committed.” Alexander v. Local 496,
Laborers’ Int’l Union of N. Am., 177 F.3d 394, 402 (6th Cir. 1999). Issues of statutory
interpretation, however, are reviewed de novo. Fortney, 59 F.3d at 119.
B.     Prima facie case for summons enforcement
        In order to ensure the proper determination of tax liability, Congress “has endowed the IRS
with expansive information-gathering authority.” United States v. Arthur Young & Co., 465 U.S.
805, 816 (1984). Section 7602 of the Internal Revenue Code, 26 U.S.C. § 7602, is the “centerpiece
of that congressional design.” Arthur Young, 465 U.S. at 816. Under § 7602, the Commissioner of
the IRS is authorized, “[f]or the purpose of ascertaining the correctness of any return . . . , [t]o
examine any books, papers, records, or other data which may be relevant or material to such inquiry”
and to summon any person to produce such documents. 26 U.S.C. § 7602(a)(1) & (2). The summons
power is not limited to the taxpayer under investigation, but may also be issued to a third party who
has relevant information. 26 U.S.C. § 7602(a)(2).
        The courts, and not the IRS, are authorized to enforce this summons power. United States
v. Will, 671 F.2d 963, 966 (6th Cir. 1982) (affirming the district court’s enforcement of a summons
over the taxpayer’s objection that the summons was issued in bad faith). In United States v. Powell,
379 U.S. 48 (1964), the Supreme Court enunciated the analytical framework that governs
enforcement decisions. First, for the government to establish a prima facie case for enforcement, it
must demonstrate that (1) the investigation has a legitimate purpose, (2) the information summoned
is relevant to that purpose, (3) the documents sought are not already in the IRS’s possession, and (4)
the procedural steps required by the tax code have been followed. Id. at 57-58. “The requisite
No. 05-5080           United States v. Monumental Life Ins. Co.                                Page 4


showing is generally made by the submission of the affidavit of the agent who issued the summons
and who is seeking enforcement.” Will, 671 F.2d at 966.
        Once the government has made this prima facie showing, the burden shifts to the party being
summoned to either disprove the elements of the prima facie case or “demonstrate that judicial
enforcement of the summons would otherwise constitute an abuse of the court’s process.” United
States v. Davis, 636 F.2d 1028, 1034 (5th Cir. 1981). In this case, Monumental claims that the IRS
has failed to establish a prima facie case for the reasons discussed below.
       1.      Alleged insufficiency of the agent’s affidavit
        Monumental first argues that Marien’s affidavit in support of the petition to enforce the
summons is insufficient because Marien was not the agent who issued the summons. Agent Lola Lee,
who issued the summons, did not prepare the affidavit. But Marien is a specialist in the tax treatment
of employee benefit plans and was specifically assigned to the Johnson investigation. Although this
court’s authority on point states that the agent who issued the summons is an appropriate person to
establish a prima facie case for enforcement, Will, 671 F.2d at 966, there is no caselaw holding that
another IRS investigator is incompetent to provide the requisite information.
         Agent Marien had personal knowledge of the Johnson investigation and the documents
needed to determine Johnson’s tax liability. See Fed. R. Civ. P. 56 (requiring affidavits to be based
on personal knowledge). Because Marien, the IRS’s national specialist in this area, was competent
to establish the Powell factors, his affidavit does not fail due to an alleged technical deficiency. The
district court’s reliance on the affidavit, therefore, was not clearly erroneous.
       2.      The Neonatology documents
       Monumental also argues that many of the documents sought by the summons are already in
the possession of the IRS. Specifically, Monumental produced some of the general information
regarding its products when the IRS was investigating Neonatology Associates (the Neonatology
documents). Neonatology Associates used many of the same types of insurance arrangements as
Johnson. The IRS does not dispute that it already has the Neonatology documents, but claims it does
not possess them in a form that it can employ in the investigation of Johnson because of the
confidentiality requirements of 26 U.S.C. § 6103.
         Under 26 U.S.C. § 6103(a), federal tax returns and tax return information are confidential.
 “Federal employees may not disclose such information unless an exception is met, and a taxpayer
has a statutory cause of action for damages” in the event of an unauthorized disclosure of return
information. Rowley v. United States, 76 F.3d 796, 799 (6th Cir. 1996) (citation and quotation marks
omitted); see also 26 U.S.C. § 7431(a) (imposing civil liability for disclosure of return information
by a government agent). Return information includes “a taxpayer’s identity, the nature, source, or
amount of his income, payments, receipts, deductions, exemptions, credits . . . or any other data”
collected by the IRS with respect to a return or with respect to the determination of possible tax
liability. 26 U.S.C. § 6103(b)(2)(A).
        But return information does not encompass “data in a form which cannot be associated with
or otherwise identify, directly or indirectly, a particular taxpayer.” 26 U.S.C. § 6103(b)(2)(D).
Moreover, an explicit exception to the confidentiality requirements is made for “inspection by or
disclosure to officers and employees of the Department of the Treasury whose official duties require
such inspection or disclosure for tax administration purposes.” 26 U.S.C. § 6103(h)(1). Internal use
by the IRS of the Neonatology documents in the Johnson investigation, therefore, would not violate
the confidentiality requirements.
No. 05-5080            United States v. Monumental Life Ins. Co.                                  Page 5


        The IRS further argues, however, that “actual possession of or access to information by the
IRS is not an absolute ban to enforcement of a summons for that information,” quoting Phillips v.
United States, No. 98-3128, 1999 WL 228585, at *3 (6th Cir. March 10, 1999) (unpublished). But
the summoned taxpayer in Phillips produced no evidence to contradict the IRS agent’s affidavit
declaring that the IRS did not possess any of the requested information. Id. The quoted language in
Phillips is therefore dicta, to say nothing of the fact that the case is also unpublished. Phillips is thus
easily distinguishable from the present case, where the IRS does not dispute that it already possesses
certain of the requested documents.
        In addition, the proposition stated in Phillips that actual possession is not an absolute ban to
summons enforcement derives from a Fifth Circuit case in which there was little evidence that the
IRS actually had possession of the summonsed documents. See Davis, 636 F.2d at 1037 (enforcing
a summons in part where the taxpayer did not request discovery as to whether the IRS possessed the
questioned documents). The Fifth Circuit in Davis balanced the unnecessary harassment of the
taxpayer inherent in a summons requesting already-possessed information with the need to expedite
summons-enforcement proceedings to allow for effective investigations by the IRS. Id. at 1038-39.
 This balancing test was applied in another unpublished case from this circuit, United States v. Alpha
Medical Management, Inc., No. 96-5825, 1997 WL 359065, at *3 (6th Cir. June 26, 1997), which
held that district courts may limit enforcement of a summons to documents not already possessed by
the IRS, but that actual possession is not an absolute ban.
        In the present case, the district court held that Monumental has not shown that the IRS “has
practical means to access any [of the Neonatology documents, nor has Monumental] shown that
production of these documents would work an unnecessary hardship on [Monumental].” But even
assuming without deciding that this circuit would adopt the Davis balancing test, the burden must be
placed on the government rather than on Monumental to prove that the government’s interests
outweigh Monumental’s hardship. See United States v. Theodore, 479 F.2d 749, 755 (4th Cir. 1973)
(holding that the obligation is upon the IRS to demonstrate that it has no practical way of obtaining
the material within its possession). The government should bear this burden because Monumental
has successfully shown that the IRS does, in fact, possess some of the requested materials in a form
it can use in this investigation. Because Monumental has successfully rebutted the government’s
prima facie showing as required by Powell, the IRS must prove that, on balance, the Neonatology
documents cannot be practicably accessed.
        The IRS, by simply asserting that the Neonatology documents have been locked in a file
somewhere, has not shown that the Davis balancing test weighs in its favor, even if we were to
accept the government’s argument that Davis applies. Although summons-enforcement proceedings
are designed to be summary in nature and to be concluded quickly, United States v. Kis, 658 F.2d
526, 535 (7th Cir. 1981), the district court should not have dismissed Monumental’s meritorious
objections simply to “avoid a fresh round of litigation regarding exactly which documents the IRS
already may have.” Expediting an IRS summons is an important consideration, but it is not the only
goal. Monumental, because it is a third party to the IRS’s investigation of the taxpayer Johnson,
deserves greater protection against a burdensome summons. See United States v. Bisceglia, 420 U.S.
141, 157 (1975) (holding that federal courts should scrutinize summonses issued to third parties with
extra care) (superseded by statute on other grounds).
        Finally, the IRS argues that the validity of a summons should be tested as of the time that it
was issued. The summons to Monumental was issued in November of 1999, almost nine months
before the Tax Court’s decision in Neonatology, causing the IRS to claim that there is no proof that
it possessed the documents at the time the summons was issued. It relies on United States v. Kemper
Money Market Fund, Inc., 781 F.2d 1268, 1278 (7th Cir. 1986) (assessing the validity of a summons
as of the time that it was issued in affirming the denial of fees and costs to the taxpayer). But Kemper
is inapplicable because it dealt with the question of whether a referral for criminal prosecution
No. 05-5080           United States v. Monumental Life Ins. Co.                                Page 6


invalidated a summons, an entirely different issue than the one before us. Id. The IRS cites no
authority for the proposition that, in this equitable proceeding, the panel may not consider the fact
that the Neonatology documents are now in the IRS’s possession. See Kennedy v. Rubin, 254
F. Supp. 190, 194 (N.D. Ill. 1966) (“[A] suit to compel compliance with an administrative subpoena
is, by nature of the relief sought, a mandatory injunction proceeding, equitable in character. . . .”).

       Because Monumental has demonstrated that the Neonatology documents are already in the
IRS’s possession, the IRS has not satisfied this aspect of the Powell requirements. The district court
therefore committed a clear error in enforcing the summons with respect to those documents.
       3.      Relevance of the documents requested
        Monumental next challenges the relevance of many of the documents requested. Applying
the Powell test for relevance, the question is whether the records requested “might” throw light upon
the correctness of a return. Arthur Young, 465 U.S. at 814-15 & n.11. This threshold is “very low,”
United States v. Noall, 587 F.2d 123, 125 (2d Cir. 1978), but judicial protection against sweeping or
irrelevant orders is “particularly appropriate in matters where the demand for records is directed not
to the taxpayer but to a third-party.” Theodore, 479 F.2d at 754 (citation and quotation marks
omitted) (emphasis removed).
        Marien’s affidavit asserts that all of the documents requested are relevant to the investigation
of Johnson. He further states that the determination of deductions claimed by Johnson and the
characterization of insurance arrangements is a complex and fact-intensive inquiry. The district court
found that Marien’s affidavit sufficiently established relevance because courts “have consistently
recognized that declarations or affidavits by IRS directors or agents generally satisfy the Powell
requirements.” See, e.g., United States v. Stuart, 489 U.S. 353, 360-61 (1989) (holding that the
Powell requirements were satisfied by an IRS employee’s affidavit); Will, 671 F.2d at 966 (holding
that the requisite showing for the Powell factors is generally made by an affidavit of the issuing
agent).
        On appeal, Monumental contends that many of the documents sought by the IRS relate not
to Johnson, but to other unnamed taxpayers. According to Monumental’s brief, paragraphs three
through seven of the summons request “practically everything related to various insurance policies
as a whole, including insurance pricing, agent commission, marketing allowances, and reinsurance
information, as they are sold to insureds all over the country.” Monumental therefore argues that the
summons is overbroad and disproportionate to the ends sought. See Theodore, 479 F.2d at 754
(reversing the district court’s order enforcing a summons because it was “unreasonable”). The
magistrate judge agreed with Monumental that “Request 3(a),” which seeks “[a]ll documents
memorializing, describing, identifying, and/or listing insurance costs and/or premium rates in effect
during the period beginning July 1, 1991 through September 30, 1999 ” seemed particularly irrelevant
because the IRS was only investigating Johnson’s tax liability between 1994 and 1997.
        In response, the IRS contends that it is authorized to determine the “course and conduct” of
its audits. See United States v. Northwest Corp., 116 F.3d 1227, 1233 (8th Cir. 1997). It further
argues that the details on Monumental’s product lines will assist the IRS in classifying the true
nature of Johnson’s benefit plan. To fully understand the purpose of the payments made to the plan,
and to discern whether the payments are intended to accumulate value, the IRS asserts that it must
examine the general operation of Monumental’s group policies.
       Proceedings seeking enforcement of an IRS summons are intended to be summary in nature,
and “defining the permissible scope of the hearing is a decision left to the discretion of the district
court.” Will, 671 F.2d at 968 (permitting the district court to decide if further discovery on the
Powell factors is warranted). Nevertheless, in close cases, the “mere assertion of relevance” by an
No. 05-5080           United States v. Monumental Life Ins. Co.                                 Page 7


IRS agent will not necessarily satisfy the government’s burden. United States v. Goldman, 637 F.2d
664, 667 (9th Cir. 1980). The present case exemplifies an exceptional circumstance where automatic
reliance upon an agent’s affidavit is not adequate because (1) the subpoena is directed to a third party,
not to the taxpayer being investigated, (2) the IRS seeks a voluminous amount of highly sensitive
proprietary information about Monumental’s general administration of its products, (3) the IRS has
opposed the imposition of a protective order, and (4) the magistrate judge, who spent years
considering the scope of the summons, found that the IRS was seeking “some irrelevant information.”
        We agree with the magistrate judge that some of the documents requested by the IRS appear
to be far removed from the investigation of Johnson’s tax liability. The district court’s abbreviated
analysis of this issue does not persuade us otherwise. In this case, where a large burden is imposed
upon a third party to produce proprietary documents that the IRS has refused to place under a
protective order, Marien’s word that all of the documents summoned are relevant should not be the
end of the district court’s inquiry.
          We would normally remand this case with instructions for the district court to limit
enforcement of the summons to relevant documents that are not already in the IRS’s possession.
Narrowing the scope of the documents that may be summoned constitutes the partial enforcement of
a summons, which an unpublished case in this circuit has found permissible. See Alpha Medical
Mngt., 1997 WL 339065 at *3 (limiting enforcement of the summons to documents not already
“accessible to the IRS”). See also Part II.C. below (distinguishing partial enforcement from
conditional enforcement of a summons). In this case, however, the magistrate judge has held six
hearings and undertaken extensive efforts to work out a compromise. The fact that the parties could
not reach a mutually agreeable solution leads us to believe that a remand to the district court to
determine which documents are relevant and which are not would prompt a long, drawn-out, and
contentious process. In proceedings that have already spanned several years, we think the best
course, in terms of both administrative and judicial efficiency, is to deny enforcement of the
summons in full and permit the IRS, if it wishes, to redraft a more narrowly tailored summons that
complies with the Powell requirements.
C.      Protective Order
        Because we are reversing that district court’s order enforcing the summons, we do not need
to decide the question of whether Monumental is entitled to a protective order. We should clarify,
however, the distinction between granting partial enforcement of a summons and conditionally
enforcing a summons, because this distinction has become muddied throughout these proceedings.
Monumental’s request for a protective order covering the documents sought by the IRS would
constitute conditional enforcement of the summons because restrictions would be imposed on the
IRS’s use of summoned materials. Partial enforcement, in contrast, narrows the scope of the
summons by limiting the type and amount of documents that the summoned party must produce.
Although this court has permitted a summons to be limited in scope, see Alpha Medical, 1997 WL
359065, at *3, we have never addressed the question of whether conditional enforcement is
permissible—a question that has been addressed by both the Fifth and Ninth Circuits. See Jose, 131
F.3d at1326-29 (requiring the IRS to give the summoned parties five-days notice before transferring
the documents to other divisions within the IRS was held to constitute impermissible conditional
enforcement); United States v. Barrett, 837 F.2d 1341, 1350 (5th Cir. 1988) (holding that district
courts cannot place conditions on enforcement of a summons, but must simply decide “whether to
enforce or not to enforce the summons”). This circuit’s position on the issue need not be decided at
the present time in light of our disposition of the enforcement request.
No. 05-5080         United States v. Monumental Life Ins. Co.                           Page 8


                                     III. CONCLUSION
       For all of the reasons set forth above, we REVERSE the judgment of the district court and
deny enforcement of the IRS summons.
No. 05-5080   United States v. Monumental Life Ins. Co.   Page 9
No. 05-5080          United States v. Monumental Life Ins. Co.                              Page 10


                                        ATTACHMENT 2
1.    Provide all C-Group, MG-5 or any other life insurance policies and/or certificates, including
      any amendments, riders or other modifications thereto, issued on the lives of the employees
      of Johnson Systems through their participation in TAP which were in effect during the period
      beginning October 1, 1993 through September 30, 1999.
2.    For each of the life insurance policies and/or certificates you provided in response to item 1,
      provide the following information:
      (a)     All documents relating to such products, including, but not limited to, insurance
              proposals; cost/benefit or any other financial analyses and/or projections; applications
              for life insurance coverage; underwriting information, documents specifying contract
              holders, policyowners, certificate holders and/or beneficiaries; periodic account
              statements specifying premiums received, dividends, interest, experience credits
              and/or refunds, cash values, reserves (or the equivalent), conversion credit account
              accumulations, costs of insurance, morbidity and mortality costs and/or administrative
              charges.
      (b)     All documents listing, describing and/or identifying the status of each life insurance
              product as of September 30, 1999.
      (c)     If any of the products paid death benefits, provide all documents relating to such
              benefit payments.
      (d)     If any of the products matured, terminated, lapsed or converted, provide all documents
              relating to such maturity, termination, lapse or conversion.
      (e)     All documents describing, identifying, calculating and/or analyzing the method of
              determining the amount of any annual economic benefit attributable to the value of
              providing current life insurance protection to the employees of Johnson Systems for
              each year from 1994 through 1998. This request includes, but is not limited to, all
              documents relating to the preparation and/or issuance of any Forms W-2, W-2P, 1099,
              1099-R or the equivalent.
      (f)     All documents describing, identifying, analyzing and/or reporting the commissions,
              or the equivalent, paid in regard to each product for the period October 1, 1993
              through September 30, 1999.
3.    Provide the following information relating to the C-Group product:
      (a)     All documents memorializing, describing, identifying and/or listing the insurance
              costs and/or premium rates in effect during the period beginning July 1, 1991 through
              September 30, 1999.
      (b)     All documents determining, calculating, projecting and/or analyzing the insurance
              costs and/or premium rates including, but not limited to, the following:
              i)      Product specifications,
              ii)     Pricing documents,
              iii)    Profits tests,
              iv)     Non-guaranteed element reports,
              v)      Underwriting requirements,
No. 05-5080           United States v. Monumental Life Ins. Co.                             Page 11


              vi)      Conversion credit account accumulations,
              vii)     Cash values (or the equivalent),
              viii)    Surrender costs,
              ix)      Loan options,
              x)       Statutory reserves,
              xi)      Tax reserves,
              xii)     Experience credits and/or refunds
              xiii)    Morbidity and mortality costs,
              xiv)     Administrative charges,
              xv)      Actuarial documents and/or studies,
              xvi)     Premium costs, and
              xvii)    Premium payment options.
      (c)     All documents filed with the Texas, Illinois and/or Kentucky departments of
              insurance and/or finance.
      (d)     All documents relating to the implementation and operation of any Reinsurance
              and/or Coinsurance Agreement(s) including, but not limited to, the following:
              i)       Calculation of any mortality charges and/or YRT premiums,
              ii)      Calculation, reporting, accounting and/or maintenance of the reserves for any
                       conversion credit allowances and/or any conversion credit accumulation
                       accounts,
              iii)     Calculation and/or maintenance of any reserves for death benefits,
              iv)      Calculation, payment and/or crediting of any experience refunds,
              v)       Calculation, payment and/or crediting of any commissions and/or expense
                       allowances,
              vi)      Documents required to be provided to the reinsurer or coinsurer in accordance
                       with the agreement(s),
              vii)     Documents relaxing to, or otherwise memorializing or describing, any audits
                       performed by the reinsurer or coinsurer to ensure or verify compliance with
                       the terms of the agreement(s),
              viii)    Documents required to be filed with any state department of insurance, state
                       department of finance, or other state agency relating to the agreement(s),
              ix)      Documents required to be submitted by Monumental for reimbursement or
                       payment pursuant to the terms of the agreement(s),
              x)       Applications for reinsurance and/or coinsurance,
              xii)     Copies of such agreement(s), including all amendments or modifications
                       thereto, and
              xi)      All rate books, application forms, premium and nonforfeiture value manuals,
                       reserve tables and other documents provided by Monumental pursuant to the
                       terms of the agreement(s).
      (e)     All documents memorializing, describing, identifying, listing and/or analyzing all
              issuances, maturities, terminations, lapses and/or conversions during the period July 1,
              1991 through September 30, 1999. This request includes, but is not limited to,
              documents providing any or all of the following information for each certificate: case
              number, policy number, certificate number, contractholder, policyholder,
              certificateholder, beneficiary name, employer name and address, agent name and
              address, amount of insurance, issue date, paid to date, premiums paid, date of
              maturity, termination, lapse or conversion.
No. 05-5080           United States v. Monumental Life Ins. Co.                             Page 12


      (f)     All documents memorializing, describing, identifying and/or analyzing the events
              under which a covered employee may convert to an individual policy including all
              documents explaining these events and explaining the conversion process.
      (g)     All documents memorializing, describing, identifying, determining, calculating,
              projecting and/or analyzing the conversion provisions including, but not limited to,
              all documents listing the life insurance products to which the C-Group product can
              be converted, the amount of life insurance coverage provided after conversion, any
              and all benefits obtained as a result of such conversion and the costs of conversion.
      (h)     All sales, marketing, promotional and/or training documents, whether or not such
              documents were provided to Johnson Systems or its employees or agents.
4.    Provide the following information relating to the C-Group Conversion UL policy:
      (a)     All documents memorializing, describing, identifying and/or listing the insurance
              costs and/or premium rates in effect during the period beginning July 1, 1991 through
              September 30, 1999.
      (b)     All documents determining, calculating, projecting and/or analyzing the insurance
              costs and/or premium rates including, but not limited to, the following:
              1)       Product specifications,
              ii)      Pricing documents,
              iii)     Profits tests,
              iv)      Non-guaranteed element reports,
              v)       Underwriting requirements,
              vi)      Conversion credit account applications.
              vii)     Cash values (or the equivalent),
              viii)    Surrender costs,
              ix)      Loan options,
              x)       Statutory reserves,
              xi)      Tax reserves,
              xii)     Experience credits and/or refunds,
              xiii)    Morbidity and mortality costs,
              xiv)     Administrative charges,
              xv)      Actuarial documents and/or studies,
              xvi)     Premium costs, and
              xvii)    Premium payment options.
      (c)     All documents filed with the Texas, Illinois and/or Kentucky departments of
              insurance and/or finance.
      (d)     All documents memorializing, describing, identifying and/or analyzing all issuances,
              maturities, terminations or lapses during the period July 1, 1991 through September
              30, 1999. This request includes, but is not limited to, documents providing any or all
              of the following information for each policy: case number, policy number,
              policyholder, insured name and address, beneficiary name, agent name and address,
              amount of insurance, issue date, paid to date, premiums paid, conversion credit
              applications, cash value projections, policy loans, date of maturity, termination, lapse
              or conversion.
No. 05-5080           United States v. Monumental Life Ins. Co.                             Page 13


       (e)    All sales, marketing, promotional and/or training documents, whether or not such
              documents were provided to Johnson Systems or its employees or agents.
If any C-Group products were converted to any other conversion policies, provide the following
information relating to such policies:
       (a)    All documents memorializing, describing, identifying and/or listing the insurance
              costs and/or premium rates in effect during the period beginning July 1, 1991 through
              September 30, 1999.
       (b)    All documents determining, calculating, projecting and/or analyzing the insurance
              costs and/or premium rates including, but not limited to, the following:
              i)       Product specifications,
              ii)      Pricing documents,
              iii)     Profits tests,
              iv)      Non-guaranteed element reports,
              v)       Underwriting requirements,
              vi)      Conversion credit account applications,
              vii)     Cash values (or the equivalent),
              viii)    Surrender costs,
              ix)      Loan options,
              x)       Statutory reserves,
              xi)      Tax reserves,
              xii)     Experience credits and/or refunds,
              xiii)    Morbidity and mortality costs,
              xiv)     Administrative charges,
              xv)      Actuarial documents and/or studies,
              xvi)     Premium costs, and
              xvii)    Premium payment options.
       (c)    All documents filed with the Texas, Illinois and/or Kentucky departments of
              insurance and/or finance.
       (d)    All documents memorializing, describing, identifying and/or analyzing all issuances,
              maturities, terminations or lapses during the period July 1, 1991 through September
              30, 1999. This request includes, but is not limited to, documents providing any or all
              of the following information for each policy: case number, policy number,
              policyholder, insured name and address, beneficiary name, agent name and address,
              amount of insurance, issue date, paid to date, premiums paid, conversion credit
              applications, cash value projections, policy loans, date of maturity, termination, lapse
              or conversion.
       (e)    All sales, marketing, promotional and/or training documents, whether or not such
              documents were provided to Johnson Systems or its employees or agents.
6.     Provide the following information relating to the MG-5 product:
       (a)    All documents memorializing, describing, identifying and/or listing the insurance
              costs and/or premium rates in effect during the period beginning July 1, 1991 through
              September 30, 1999.
No. 05-5080           United States v. Monumental Life Ins. Co.                           Page 14


      (b)     All documents determining, calculating, projecting and/or analyzing the insurance
              costs and/or premium rates including, but not limited to, the following:
              i)       Product specifications,
              ii)      Pricing documents,
              iii)     Profits tests,
              iv)      Non-guaranteed element reports,
              v)       Underwriting requirements,
              vi)      Statutory reserves,
              vii)     Tax reserves,
              viii)    Morbidity and mortality costs,
              ix)      Administrative charges,
              x)       Actuarial documents and/or studies,
              xi)      Premium costs,
              xii)     Renewal premium costs, and
              xiii)    Premium payment options.
      (c)     All documents filed with the Texas, Illinois and/or Kentucky departments of
              insurance and/or finance.
      (d)     All documents relating to the implementation and operation of any Reinsurance
              and/or Coinsurance Agreement(s) including, but not limited to, the following:
              i)       Calculation of any mortality charges and/or YRT premiums,
              ii)      Calculation and/or maintenance of any reserves for death benefits,
              iii)     Calculation, payment and/or crediting of any experience refunds,
              iv)      Calculation, payment and/or crediting of any commissions and/or expense
                       allowances,
              v)       Documents rcquired to be provided to the reinsurer or coinsurer in accordance
                       with the agreement(s),
              vi)      Documents relating to, or otherwise memorializing or describing, any audits
                       performed by the reinsurer or coinsurer to ensure or verify compliance with
                       the terms of the agreement(s),
              vii)     Documents required to be filed with any state department of insurance, state
                       department of finance, or other state agency relating to the agreement(s),
              viii)    Documents required to be submitted by Monumental for reimbursement or
                       payment pursuant to the terms of the agreement(s),
              ix)      Applications for reinsurance and/or coinsurance,
              x)       Copies of such agreement(s), including all amendments or modifications
                       thereto, and
              xi)      All rate books, application forms, premium and nonforfeiture value manuals,
                       reserve tables and other documents provided by Monumental pursuant to the
                       terms of the agreement(s).
      (e)     All documents memorializing, describing, identifying, listing and/or analyzing all
              issuances, maturities, terminations, lapses and/or conversions during the period July
              1, 1991 through September 30, 1999. This request includes, but is not limited to,
              documents providing any or all of the following information for each certificate: case
              number, policy number, certificate number, contractholder, policyholder,
              certificateholder, beneficiary name, employer name and address, agent name and
              address, amount of insurance, issue date, paid to date, premiums paid, date of
              maturity, termination, lapse or conversion.
No. 05-5080           United States v. Monumental Life Ins. Co.                           Page 15


      (f)     All documents memorializing, describing, identifying and/or analyzing the events
              under which a covered employee may convert to an individual policy including all
              documents explaining these events and explaining the conversion process.
      (g)     All documents memorializing, describing, identifying, determining, calculating,
              projecting and/or analyzing the conversion provisions including, but not limited to,
              all documents listing the life insurance products to which the MG-5 product can be
              converted, the amount of life insurance coverage provided after conversion, any and
              all benefits obtained as a result of such conversion and the costs of conversion.
      (h)     All sales, marketing, promotional and/or training documents, whether or not such
              documents were provided to Johnson Systems or its employees or agents.
7.    If any other life insurance product was issued on the lives of employees of employers
      participating in TAP, provide the following information:
      (a)     All documents memorializing, describing, identifying and/or listing the insurance
              costs and/or premium rates in effect during the period beginning July 1, 1991 through
              September 30, 1999.
      (b)     All documents determining, calculating, projecting and/or analyzing the insurance
              costs and/or premium rates including, but not limited to, the following:
              i)       Product specifications,
              ii)      Pricing documents,
              iii)     Profits tests,
              iv)      Non-guaranteed element reports,
              v)       Underwriting requirements,
              vi)      Statutory reserves,
              vii)     Tax reserves,
              viii)    Morbidity and mortality costs,
              ix)      Administrative charges,
              x)       Actuarial documents and/or studies,
              xi)      Premium costs,
              xii)     Renewal premium costs, and
              xiii)    Premium payment options.
      (c)     All documents filed with the Texas, Illinois and/or Kentucky departments of
              insurance and/or finance.
      (d)     All documents relating to the implementation and operation of any Reinsurance
              and/or Coinsurance Agreement(s) including, but not limited to, the following:
              i)       Calculation of any mortality charges and/or YRT-premiums,
              ii)      Calculation and/or maintenance of any reserves for death benefits,
              iii)     Calculation, payment and/or crediting of any experience refunds,
              iv)      Calculation, payment and/or crediting of any commissions and/or expense
                       allowances,
              v)       Documents required to be provided to the reinsurer or coinsurer in accordance
                       with the agreement(s),
              vi)      Documents relating to, or otherwise memorializing or describing, any audits
                       performed by the reinsurer or coinsurer to ensure or verify compliance with
                       the terms of the agreement(s),
No. 05-5080           United States v. Monumental Life Ins. Co.                             Page 16


              vii)     Documents required to be filed with any state department of insurance, state
                       department of finance, or other state agency relating to the agreement(s),
              viii)    Documents required to be submitted by Monumental for reimbursement or
                       payment pursuant to the terms of the agreement(s),
              ix)      Applications for reinsurance and/or coinsurance,
              x)       Copies of such agreement(s), including all amendments or modifications
                       thereto, and
              xi)      All rate books, application forms, premium and nonforfeiture value manuals,
                       reserve tables and other documents provided by Monumental pursuant to the
                       terms of the agreement.
      (e)     All documents memorializing, describing, identifying, listing and/or analyzing all
              issuances, maturities, terminations, lapses and/or conversions during the period July
              1, 1991 through September 30, 1999. This request includes, but is not limited to,
              documents providing any or all of the following information for each certificate: case
              number, policy number, certificate number, contractholder, policyholder,
              certificateholder, beneficiary name, employer name and address, agent name and
              address, amount of insurance, issue date, paid to date, premiums paid, date of
              maturity, termination, lapse or conversion.
      (f)     All documents memorializing, describing, identifying and/or analyzing the events
              under which a covered employee may convert to an individual policy including all
              documents explaining these events and explaining the conversion process.
      (g)     All documents memorializing, describing, identifying, determining, calculating,
              projecting and/or analyzing the conversion provisions including, but not limited to,
              all documents listing the life insurance products to which the other life insurance
              product can be converted, the amount of life insurance coverage provided after
              conversion, any and all benefits obtained as a result of such conversion and the costs
              of conversion.
      (h)     All sales, marketing, promotional and/or training documents, whether or not such
              documents were provided to Johnson Systems or its employees or agents.
8.    If applicab1e, provide all annuity contracts, including all amendments, riders or other
      modifications thereto, issued by Monumental in regard to the employees of Johnson Systems
      through their participation in TAP, which were in effect during the period beginning October
      1, 1993 through September 30, 1999.
9.    For each of the annuity contracts you provided in response to item 8, provide the following
      information.
      (a)     Provide all documents relating to such annuity contracts. This request includes, but
              is not limited to, annuity proposals cost/benefit or any other financial analyses and/or
              projections; annuity computation worksheets; annuity applications; contractholder,
              annuityowner, annuitants and/or beneficiaries, benefit payment applications; periodic
              annuity account statements specifying premiums, deposits (or the equivalent)
              received, annuity earnings, periodic annuity values and administrative charges; and
              explanations of the benefits provided under the annuity contracts and conditions
              required for benefit payment.
      (b)     Provide all documents describing and/or identifying the status of each annuity
              contract as of September 30, 1999.
No. 05-5080         United States v. Monumental Life Ins. Co.                              Page 17


      (c)     For each of the annuities that paid benefits, provide all documents relating to such
              payments.
      (d)     For each of the annuities that was canceled, terminated, distributed or the equivalent,
              provide all documents relating to such cancellation, termination or distribution.
      (e)     Provide all documents describing, identifying and/or analyzing the method of
              determining the amount of any reportable benefit provided to each Johnson Systems
              employee as a result of his/her participation in the annuity contracts from October 1,
              1993 to September 30, 1999. This request includes, but is not limited to, all
              documents relating to the preparation and/or issuance of any Forms W-2, W-2P, 1099,
              1099-R or the equivalent.
      (f)     Provide all documents identifying and/or describing the commissions, or the
              equivalent, paid in regard to each annuity contract for the employees of Johnson
              Systems for the period October 1, 1993 through September 30, 1999.
      (g)     Provide all marketing and/or promotional documents relating to the annuity products
              described above, including, but not limited to, sales and/or training documents,
              whether or not such documents were provided to Johnson Systems or its employees
              or agents.
10.   Provide all documents describing the relationship between you and TAP with respect to the
      life insurance and annuity products described above.
11.   Provide all agreements you entered into with TAP regarding the marketing, advertising, and
      sales of any and all of the life insurance and/or annuity products described above.
12.   Provide all documents describing the relationship between you and Tax Awareness with
      respect to the life insurance and annuity products described above.
13.   Provide all agreements you entered into with Tax Awareness regarding the marketing,
      advertising, and sales of any and all of the life insurance and/or annuity products described
      above.
14.   Provide all documents describing the relationship between you and Wells Fargo with respect
      to the life insurance and annuity products described above.
15.   Provide all agreements you entered into with Wells Fargo regarding the marketing,
      advertising, and sales of any and all of the life insurance and/or annuity products described
      above.
16.   Provide all documents describing the relationship between you and CJA with respect to the
      life insurance and annuity products described above.
17.   Provide all agreements you entered into with CJA regarding the marketing, advertising, and
      sales of any and all of the life insurance and/or annuity products described above.
18    Provide all documents describing the relationship between you and any other life insurance
      company with respect to the life insurance and annuity products described above.
No. 05-5080          United States v. Monumental Life Ins. Co.                             Page 18


19.    Provide all agreements you entered into with any other insurance company regarding the
       marketing, advertising, and sales of any and all of the life insurance and/or annuity products
       described above.
20.    Provide all documents describing the relationship between you and Paul Hinson, in his
       capacity as a life insurance agent.
21.    Provide all agreements you entered into with Paul Hinson, in his capacity as a life insurance
       agent, regarding the marketing, advertising, and sales of any and all of the life insurance
       and/or annuity products described above.
22.    Provide all agreements you entered into with any other entities or individuals regarding the
       marketing, advertising, and sales of any and all of the life insurance and/or annuity products
       described above.
23.    Provide all documents describing the relationship between you and Johnson Systems and/or
       the employees of Johnson Systems with respect to the life insurance and annuity products
       described above.
24.    Provide any and all written policies and/or instructions pertaining to your record retention
       procedures.
With respect to the records and/or information requested in the items above, Monumental should
appear through and by such person or persons who can authenticate the documents produced and who
has knowledge or to whom knowledge is reasonably available concerning the activities, events,
transactions and entities reflected in the records to be produced in response to this summons.
