Jury awards $388 million judgment

A case that has dragged through courts for a decade has resulted in a staggering $388 million award for a Las Vegas inventor against California state tax authorities.

Mark Hutchison, lead attorney for inventor Gilbert Hyatt, said he expects an appeal to the verdicts issued over the past two weeks in Clark County District Court.

“This phase of the case is over,” he said. “I’d be shocked if this is the end, based on how hard the California Franchise Tax Board has fought every step of the way for 10 years.”

The civil lawsuit was filed in 1998, alleging fraud, intentional infliction of emotional distress, abuse of process, breach of confidential relationship and invasions of privacy, Hutchison said.

An eight-member civil jury decided against the tax agency, awarding Hyatt more than $138 million in liability and compensatory damages on Aug. 6 and $250 million in punitive damages Thursday, he said. The decision to award those amounts was unanimous in the first verdict and 7-1 in the second, he said.

At issue in this suit, Hutchison said, was whether the FTB engaged in wrongful acts when it conducted a residency audit to see if Hyatt owed taxes on licensing income generated from many of his U.S. patents in the early 1990s.

Hyatt maintains that he moved from La Palma, Calif., to Las Vegas in September 1991. According to Hutchison, the FTB said Hyatt was a Golden State resident until early April 1992.

Hyatt, 70, is an electrical engineer and inventor with more than 70 U.S. patents, including one in 1990 for a computer microprocessor, Hutchison said.

The case was filed under seal in 1998; the case file now contains more than 2,100 documents. Clark County District Judge Jessie Walsh on Friday ordered it to remain sealed, according to court records.

Sealed cases do not automatically include gag orders prohibiting participants from discussing the cases, but they do deny media and other members of the public the opportunity to independently confirm their statements by examining documents.

It was not immediately clear if the FTB would appeal.

“We’re reviewing the matter and hope to have a decision soon,” said John Barrett, spokesman for the tax board in Sacramento.

Patricia Lundvall, the Nevada lawyer who represented the California tax authority, was traveling and unavailable for comment, an aide said.

Hutchison said the combined awards are among the largest rendered by a U.S. jury in favor of a single defendant.

“It sends a clear message that government abuse and over-reaching will not be tolerated by Nevada citizens,” he said. “I think the message is: If you are going to audit Nevada residents, you had better do so in a fair and impartial manner and not be results-oriented in seeking to grab money from Nevada residents.”

Reached by phone Monday, Hyatt said the length of his California residency remains in dispute. He expects the California State Board of Equalization to hold a hearing on that matter in a year or two.

Hyatt said the FTB claims he owes more than $50 million, including penalties for fraud. That figure is based on income generated by 24 of his patents.

Hyatt described the recent jury verdicts as “well-reasoned.” Jurors listened to 14 weeks of testimony, he said.

“I’m pleased with their verdicts because I believe it will send a message to the Franchise Tax Board that they cannot continue these kinds of tactics,” he said.

Hyatt alleged the taxing authority had falsified evidence during his audit to reach predetermined conclusions and had rubber-stamped flawed audits in the review process.

But the verdicts fail to give him a sense of closure.

“It will never close because the issue is reform of a very bad government taxation system that abuses taxpayer rights, and the reform process will continue on,” Hyatt said.

He expects appeals from the FTB will tie up the awards for years. He said he will devote at least some of the money to fight for reform.

“I look at it as a philanthropic project to use these verdicts to help reform governmental abuse of citizens.”

The California tax board lost arguments before the Nevada Supreme Court and the U.S. Supreme Court that Nevada courts were an inappropriate forum to hear the case, before the trial was conducted in Las Vegas, Hutchison said.

The Associated Press contributed to this report. Contact reporter Margaret Ann Miille at mmiille@reviewjournal.com or 702-383-0401.

Melvin Dummar dead at 74
Melvin Dummar has died at 74. Dummar was famous for claiming to have saved Howard Hughes in a Nevada desert in 1967. Dummar claimed to have been left $156 million in Hughes’ will. The will mysteriously appeared after Hughes’ death in 1976. It was dismissed as a fake two years later. Dummar never saw a dime of the billionaire's fortune. Dummar died Saturday in Nye County.
Officer-involved shooting in Nye County
The Nye County Sheriff's Office gives information about a shooting in Pahrump on Thursday night after a man began firing shots outside of his home. (Nye County Sheriff's Office)
Law Enforcement Active Shooter Training Exercise
Multiple Las Vegas Valley law enforcement agencies held an active shooter drill at the Department of Public Safety’s Parole and Probation office on December 6, 2018. Officials set up the training exercise to include multiple active shooters, a barricaded suspect and multiple casualties. (Katelyn Newberg/ Las Vegas Review-Journal)
Public memorial service for Jerry Herbst
Archiving effort hits milestone at Clark County Museum
The Clark County Museum catalogs the final item from the bulk of Route 91 Harvest festival artifacts. (John Przybys/Las Vegas Review-Journal)
Pearl Harbor survivor Edward Hall talks about his memories of Dec. 7, 1941
U.S. Army Corps Edward Hall, a 95-year-old survivor of Pearl Harbor talks about his memories of that horrific day. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Final Route 91 Harvest festival remembrance objects catalogued at Clark County Museum
The last of the more than 17,000 items left at the makeshift memorial near the Las Vegas sign after the Oct. 1 shootings have been catalogued at the Clark County Museum in Las Vegas. The final item was a black-and-white bumper sticker bearing "#VEGASSTRONG. An additional 200 items currently on display at the museum will be catalogued when the exhibit comes down. (K.M. Cannon Las Vegas Review-Journal)
Dozier execution timeline
Scott Dozier was set to be executed July 11, 2018, at the Ely State Prison. Judge Elizabeth Gonzalez delayed the execution.
Grand Jury Indicts Constable for theft
A Clark County grand jury indicted Henderson Constable Earl Mitchell. A Las Vegas Review-Journal investigation prompted the criminal probe. The newspaper found Mitchell wrote himself thousands in checks, took out cash at ATMs and traveled on county funds. He faces four felony counts of theft and a county of public misconduct. Mitchell and his attorney could not be reached for comment.
93-year-old WWII veteran arrested during visit to VA hospital
Dr. S. Jay Hazan, 93, a World War II veteran, talks about his arrest during his visit to VA hospital on Friday, Nov. 30. (Erik Verduzco Las Vegas Review-Journal @Erik_Verduzco_
Pearl Harbor survivor struggles in her senior years
Winifred Kamen, 77, survived the attack on Pearl Harbor as an infant, works a 100 percent commission telemarketing job to make ends meet. (K.M. Cannon Las Vegas Review-Journal)
Las Vegas Metropolitan Briefing 18th street gang
Las Vegas Metropolitan briefs the media on the recent arrests made regarding the 18th street gang.
Man shot in Las Vegas traffic stop had knife, police say
Police said the man fatally shot by an officer during a traffic stop in downtown Las Vegas had a “homemade knife.” Demontry Floytra Boyd, 43, died Saturday at University Medical Center from multiple gunshot wounds after officer Paul Bruning, 48, shot him during a traffic stop. Bruning pulled Boyd over on suspicion of driving recklessly at 7:41 a.m. near Sunrise Avenue and 18th Street.
Catahoula dogs rescued from home in Moapa Valley
Catahoula dogs were brought to The Animal Foundation after being rescued from home in Moapa Valley.
Intuitive Forager Kerry Clasby talks about losses in California wildfire
Intuitive Forager Kerry Clasby talks about losses she suffered in California's Woolsey Fire in Malibu in November. (Al Mancini/Las Vegas Review-Journal)
Benefit dinner for Kerry Clasby, the Intuitive Forager
Sonia El-Nawal of Rooster Boy Cafe in Las Vegas talks about having a benefit for Kerry Clasby, known as the Intuitive Forager, who suffered losses on her farm in California’s Woolsey Fire in Malibu. (Al Mancini/Las Vegas Review-Journal)
Former President George H.W. Bush dies at 94
Former President George H.W. Bush has died at the age of 94. He died Friday night in Houston, about eight months after the death of his wife, Barbara.
Las Vegans Celebrate Big Snowfall
Las Vegans celebrate big snowfall at Lee Canyon.
Exploring old mines for denim jeans and other vintage items
Caden Gould of Genoa, Nev. talks about his experiences looking for vintage denim jeans and other items in old mines and other places areas across Nevada and the west.
Officers share photo of dead gunman after Las Vegas shooting
A little over an hour after SWAT officers entered Stephen Paddock's suite at Mandalay Bay, Las Vegas police officers far from the scene were already sharing cell phone photos of the dead Oct. 1 gunman.
Frontier jet safely returns to Las Vegas after losing engine piece
Frontier jet safely returns to Las Vegas after losing engine piece. (@FlightAlerts_)
Park Service plans ahead for lower lake levels
National Park Service releases new plans to maintain access to the water as Lake Mead continues to shrink.
Women claim abuse at Florence McClure Women's Correctional Facility
Current and ex-inmates, including Merry West, are suing Florence McClure Women’s Correctional Facility, claiming abuse and inadequate medical care. (Rachel Aston/Las Vegas Review-Journal) @rookie__rae
Butte County Sheriff's Office Body Cam Footage
Bodycam video from Butte County (Calif.) Sheriff's Office Deputy Aaron Parmley, who was in Paradise November 8 helping with evacuations. (Butte County Sheriff's Office)
NDOT construction blasting along State Route 106
NDOT construction blasting along State Route 160, near Mt. Potosi Road, in Clark County as part of a $59 million, 6-mile-long highway widening project that began this summer. (Nevada Department of Transportation)
Car crashes into Papa Murphy's Pizza shop
A driver crashed a car into a western Las Vegas Valley pizza shop on Tuesday morning, police said. (Joe Stanhibel/Special to Las Vegas Review-Journal)
Low-lake-level pumping station nears completion
Barnard Construction and the Southern Nevada Water Authority give one last tour before the new low-lake-level pumping station is activated.
Trailer: Valley of Fires
Sultan’s Playroom from Make-A-Wish Southern Nevada
Make-A-Wish Southern Nevada’s Scott Rosenzweig talks about granting Sultan Bouras Souissi’s wish, and what went into building it. (John Hornberg/Las Vegas Review-Journal)
Jim Marsh brings historic replica of rural church to Amargosa Valley
Jim Marsh talks during the opening of the Chapel at Longstreet, a replica of an 1874 Catholic church built in the mining town of Belmont, Nev., at Marsh's Longstreet Casino in Amargosa Valley, Nev. Chase Stevens/ Las Vegas Review-Journal
News Headlines
Add Event
Home Front Page Footer Listing
You May Like

You May Like