"This is the first reported case where 409A penalties were assessed and pursued by the government.... The Company granted these stock options before 409A was even enacted, and the CEO exercised them during the 'good faith' 409A transition period ... [M]any practitioners have [assumed] that ... there may have been some IRS leniency in enforcement based on the good-faith operational compliance standard ... However, the strict enforcement of 409A in this case warrants reconsideration on this point, especially in light of the Plaintiff's' attempted self-correction through a reformation agreement." [Sutardja v. U.S., No. 11-724T (Fed. Cl. Feb. 27, 2013)  MORE >>