Los Angeles Daily News

Leader of est Movement wins $200,000 from IRS.

By P.J. Huffstutte, Daily News Staff Writer

After years of legal wrangling, the Internal Revenue Service has settled with Werner Erhard, the consciousness-movement leader who accused the agency of making false statements about him.

Calling Tuesday's $200,000 settlement a "victory for every person in the United States," Erhard's attorney, Michael Saltzman, said he hopes the case will encourage the IRS to be more sensitive about disclosing tax information.

"We're pleased to finally get closure on this matter," said Saltzman, a New York-based tax attorney. "We feel this is a step toward clarifying the record that the IRS left in 1991 about Mr. Erhard."

Between April 9 and April 15, 1991, several IRS spokesmen were reported as saying that Erhard owed millions of dollars in back taxes, that he was transferring assets out of the country, and that the agency was suing Erhard. The implication was that Erhard was a tax cheat.

In fact, Erhard, 61, contended that he never refused to pay a lawfully due tax and has not refused to pay millions back in taxes. He alleged that not only did the IRS spokesmen illegally disclose tax return information, but that the statements were false.

The founder and head of San Francisco-based Erhard Seminars Training Inc., popularly called est, filed a wrongful disclosure suit against the IRS in 1993.

IRS spokesmen subsequently admitted that the statements attributed to them about Erhard's supposed tax liability were false, but that they did not ask the media to correct the statements.

Reprinted from the L.A. Daily News September 12, 1996