By Gina Tabonares
Variety News Staff

OBJECTORS to the $90 million earned income tax credit settlement reiterated their request for disapproval of the settlement and certification of the settling parties because, they said, the notice did not comply with the requirements of due process.
Based on a review of tax returns on file, the objectors’ lawyers cited an estimate from the Department of Revenue and Taxation of 49,378 potential class members with no 1997/1998 claims.
Of this number, 24,108 or 48 percent of class members did file a total of 40,222 EITC claims.
Atty. Thomas Fisher, counsel for the Simpao group, told the District Court of Guam that of the 24,108 class members who filed claims, 22,748 or 94 percent filed all or at least one of their claims prior to the commencement of notice.
Fisher said the difference in the number of people who filed claims prior to the notice and the total number of estimated class members shows there were 25,630 class members who had not yet filed a claim before implementation of the notice program.
“Of this number, the notice program captured only 1,360 or 5.3 percent,” Fisher said.
The objectors’ lawyer said the notice and opportunity to be heard are fundamental requisites of the constitutional guarantee of due process.
“When notice is a mere gesture, it is not due process,” Fisher stressed, adding that the notice program employed by DRT was a failure as it did not capture approximately 94 percent of class members who had not yet filed a claim.
The objectors further stressed that updating addresses is a reasonable and practicable means of updating old, outdated addresses which DRT failed to do.
“Had settling parties employed a form of address updating, this court concludes that thousands of class members would have been reached with a much higher rate of claims being submitted,” Fisher added.
Settling parties that include the groups of Torres, Santos and GovGuam earlier told the court that they provided enough information to class members via publication notice in two local newspapers.
Objectors, however, argued that notice of publication could not have cured the failure to take additional steps where notice was returned.
Citing expert testimony, objectors said newspaper readership is expected to be low among lower income adults which comprise the bulk of the EITC class.
As for individualized mailings, objectors told the court that 19 percent of the notices mailed to class members were returned as undeliverable and the fact that 81 percent of the mailings were not returned as undeliverable does not mean 81 percent reached the intended class members.
It added that the settling parties’ assertion that prior approval of notice could be a basis of final approval of settlement is wrong, saying that preliminary approval of the settlement “in no way limits the court’s ability to deny final approval.”
The District Court of Guam may not approve the settlement if the record presented by the settling parties does not provide adequate notice to taxpayers or claimants.