Court Rules in Favor of IRS in Coinbase Documents Seizure Case

Coingapestaff
May 31, 2023 Updated September 4, 2025
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In a significant ruling, a federal judge in New Hampshire has dismissed a lawsuit brought against the Internal Revenue Service (IRS) challenging the agency’s procurement of financial records from cryptocurrency exchange Coinbase. U.S. District Judge Joseph N. Laplante concluded that the IRS did not violate the constitutional rights of the plaintiff, James Harper, as he had claimed.

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IRS Access Of Coinbase Valid

Harper’s lawsuit alleged violations of due process and protections against unreasonable searches and seizures. However, Judge Laplante dismissed the case, stating that Harper’s rights were not infringed upon and that the existing safeguards and checks on the IRS’s powers were sufficient.

The court’s decision has drawn attention to the broader implications for taxpayer privacy and the IRS’s power to access financial records from third-party intermediaries, including cryptocurrency exchanges.

In the order issued on Friday, Judge Laplante noted,

“The IRS’s actions at issue in this case fall squarely within that broad latitude, and Harper is not entitled to protection or relief beyond the existing congressionally and judicially imposed ‘safeguards’ and checks on the IRS’s powers.”

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Why Lawsuit Is Dismissed?

The judge’s ruling was based on several key findings. First, Harper did not have a privacy interest in the records under the Fourth Amendment since he voluntarily provided his information to Coinbase, which explicitly warned of potential disclosure to the government in its privacy policy.

Second, Harper’s claims of denial of procedural due process under the Fifth Amendment were dismissed, as there were opportunities to challenge or narrow the IRS’s summons.

Richard A. Samp of the New Civil Liberties Alliance, representing Harper, expressed plans to challenge the court’s conclusion, stating,

“Friday’s district court decision essentially removes all constraints on the IRS’ power to seek a taxpayer’s financial records from third-party record holders… That is not what Congress and the drafters of the constitution intended.”

Representatives for the U.S. Department of Justice, Tax Division has not commented on the ruling.

 

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Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
CoinGape comprises an experienced team of native content writers and editors working round the clock to cover news globally and present news as a fact rather than an opinion. CoinGape writers and reporters contributed to this article.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.