U.S. law firm must pay Dutch DJ Tiësto nearly €17 million over faulty tax advice

An Amsterdam appeals court ruled Tuesday that U.S. law firm Greenberg Traurig must pay Dutch DJ Tiësto nearly 17 million euros in damages for incorrect tax advice it gave him in 2012, overturning a lower court decision that had found no harm from the error. The court also ordered the firm to cover nearly 35,000 euros in legal costs.

Tiësto, whose real name is Tijs Verwest, sued the originally American firm — which also has an office in Amsterdam — after a tax specialist at Greenberg Traurig wrongly advised him about U.S. tax rules.

Because Verwest had spent more than the limit of a certain number of days in the United States that year, he became a tax resident there and was required to pay higher taxes. The faulty advice led to initially incorrect U.S. tax filings.

Verwest discovered the mistake in 2018 and asked U.S. tax authorities to correct the returns. He then had to pay additional taxes plus a penalty.

He first sought to hold the firm liable in 2024 for the amount paid to U.S. tax authorities. The lower court had acknowledged that Verwest received incorrect advice but ruled he suffered no damages. It said he would have owed U.S. taxes anyway and that the total might even have been higher.

The appeals court found it plausible that Verwest would have made a different choice if he had been properly informed in time about the consequences of U.S. tax residency. He would then have spent fewer days in the United States, avoided becoming a tax resident, and not had to pay the extra taxes and penalty.