ExxonMobil Victory in Interest Netting Case Is Final

[Note:  Miller and Chevalier represented the taxpayer Exxon Mobil Corp. in this case.]

We previously reported on the Second Circuit’s consideration of the interest netting issue that had been resolved against the taxpayer by the Federal Circuit in FNMA v. United States, 379 F.3d 1303 (2004).  Although we did not follow up with a timely report on the Second Circuit’s decision in that case in favor of the taxpayer, the decision is now final, with the government having allowed the time to seek certiorari to expire.  To close the loop, we provide here a summary of the decision and … Read More

Supreme Court Briefing Underway in Woods on Penalty and TEFRA Issues

The government has filed its opening brief in the Supreme Court in the Woods case, which involves whether the 40% gross valuation overstatement penalty applies in the context of a basis-inflating transaction held not to have economic substance.  See our earlier report here.

The government’s arguments on the question whether the penalty can be applied in these circumstances are similar to those discussed here previously and addressed in several court of appeals decisions.  It relies on the “plain text” of the statute, arguing that “[t]he word ‘attributable’ means ‘capable of being attributed’” and therefore a finding of lack of … Read More

Petition for Certiorari Filed in Quality Stores

The government has finally filed its long-awaited cert petition in Quality Stores, asking the Supreme Court to review the Sixth Circuit’s ruling that severance payments paid to employees pursuant to an involuntary reduction in force are not “wages” for FICA tax purposes.  In our previous coverage, we have noted why this case is a strong candidate for Supreme Court review, and the cert petition sets those forth succinctly:  (1) “the Sixth Circuit’s decision in this case squarely conflicts with the Federal Circuit’s decision in CSX Corp.”; and (2) “the question presented here is both recurring and important.”  … Read More

Supreme Court Denies Review in Historic Boardwalk and Entergy

The Court this week denied the government’s petition for certiorari in the Entergy case.  As explained in our prior post on the PPL decision, this ruling was inevitable in the wake of the Court’s decision for the taxpayer in PPL.  The denial of certiorari now cements Entergy’s victory in the Fifth Circuit.

The Court also denied certiorari in Historic Boardwalk, the historic rehabilitation tax credit case decided in the government’s favor by the Third Circuit.  See our previous reports here.… Read More

Supreme Court Rules for Taxpayer in PPL

[Note: Miller & Chevalier filed a brief in this case in support of PPL on behalf of American Electric Power Co.]

The Supreme Court this morning unanimously ruled in favor of PPL in its case involving the creditability of the U.K. Windfall tax.  See our prior coverage here.  The opinion was authored by Justice Thomas, with Justice Sotomayor adding a separate concurring opinion.

The Court’s opinion is fairly succinct.  Viewing the government’s position as more formalistic, the Court stated that it would “apply the predominant character test [of the foreign tax credit regulations] using a commonsense approach that considers … Read More

Government Brief in Woods Due on May 30

We previously reported on the Court’s grant of certiorari in Woods, noting that the government’s opening brief would be due on May 9.  If you are looking for the brief, be advised that the Court has extended the filing date until May 30.  The taxpayer’s brief will be due July 22.… Read More

Government Response Filed in Historic Boardwalk

The government has filed its brief opposing certiorari in Historic Boardwalk.  The government characterizes the decision as resting “on a fact-bound examination of the agreements between the parties” that presents no legal issue of broad applicability warranting Supreme Court review.  The brief responds at length to the taxpayer’s argument that the court of appeals misapplied Commissioner v. Culbertson, 337 U.S. 733 (1949), maintaining instead that “the court of appeals properly applied the framework set forth in Culbertson.”

As we previously noted, the taxpayer faces an uphill battle because the Court rarely hears technical tax cases over … Read More

Time to Seek Certiorari in Quality Stores Further Extended Until May 31

The Chief Justice has granted the government a second extension of time to file its petition for certiorari in Quality Stores.  See our previous coverage here.  The petition is now due May 31.  By statute, the time to petition for certiorari can be extended for a maximum of 60 days, so the government is now about at the end of its rope, and it will surely fish or cut bait by the current May 31 deadline.… Read More

Cert Petition in Quality Stores Now Due on May 3

The Supreme Court has granted the government’s request for a one-month extension to file its petition for certiorari in Quality Stores, extending the due date from April 4 to May 3.  As we have previously observed, we believe there is a strong likelihood that the government will petition in this case and that the Court will grant certiorari to resolve the circuit conflict on the treatment for FICA purposes of supplemental unemployment compensation benefits.  See our previous coverage here.

With this extension, however, the Court likely will not decide whether to grant certiorari until early October, after the … Read More

D.C. Circuit Denies Government’s Stay Request in Loving

The D.C. Circuit (Rogers, Tatel, and Brown, JJ.) has denied the government’s request for a stay of the district court’s injunction of the new registration regime for paid tax-return preparers.  The court did not give an elaborate explanation, simply stating that “[a]ppellants have not satisfied the stringent requirements for a stay pending appeal.”  Thus, the court did not indicate whether the government fell short because its motion was not sufficiently convincing that the district court was likely to be reversed on the merits or because it did not make a sufficiently compelling case of irreparable harm.

In any case, it … Read More

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