District Court Judge Consuelo Marshall issued a permanent injunction in the Guam tax refund class action lawsuit.  Girard Gibbs and their co-counsel at Lujan, Aguigui and Perez represent taxpayers who challenged the government of Guam’s practice of delaying the release of income tax refunds owed to taxpayers, and also the system of paying refunds to certain taxpayers ahead of others.

Under the injunction, the Government of Guam must pay most tax refunds no later than six months after tax returns are due.  And the practice of “expediting” refunds to certain taxpayers has been terminated.  If the Government fails to comply with the new payment timeline or any other part of the injunction, it could potentially face a court-ordered receivership, a remedy often used in litigation as a last resort when an agency fails to implement court orders or obligations.

For the next five years, government officials will need to provide periodic reports to the plaintiffs about their efforts to timely pay income tax refunds.  The deadline for the first report is April 1, 2013.

For more information, please read the Court’s Findings of Fact and Conclusions of Law and Permanent Injunction.