Comcast Corp. II v. Dept. of Rev. (TC 4909) ( 2015 )

64 April 21, 2015 No. 9
9
Comcast Corp. II v. Dept. of Rev. (TC 4909) 22 OTR
April 21, 2015
IN THE OREGON TAX COURT
REGULAR DIVISION
COMCAST CORPORATION,
Plaintiff,
v.
DEPARTMENT OF REVENUE,
Defendant.
(TC 4909)
Following the remand of this matter from the Oregon Supreme Court,
a dispute arose between the parties as to the scope of the issues remanded.
Plaintiff (taxpayer) argued that remaining issues as to discrimination claims
under the Oregon and federal constitutions, taxpayer’s claim under the Internet
Tax Freedom Act and taxpayer’s claim under Measure 50 were to be litigated.
Defendant Department of Revenue (the department) argued that with the excep-
tion of taxpayer’s claim as to Measure 50, all other claims for relief contained
in taxpayer’s amended complaint could not be considered, based on the actions
taken by the Supreme Court. The court ruled that the department’s position
was erroneous, because it could point to no statute, appellate rules, or case law
authority to support its position, and would result in situations where a taxpayer,
victorious in the Tax Court as to a conclusive statutory claim or argument would
be required to assign as error federal statutory, as well as state and federal con-
stitutional, claims or arguments not decided there, and therefore would result in
a fundamental violation of due process rights of a taxpayer.
Oral argument on scope of remand was held April 20,
2015, in the courtroom of the Oregon Tax Court, Salem.
Cynthia M. Fraser, Garvey Schubert Barer PC, Portland
filed the briefing and argued the cause for Plaintiff (taxpayer).
Marilyn J. Harbur, Senior Assistant Attorney General,
Department of Justice, Salem, filed the briefing and argued
the cause for Defendant Department of Revenue.
Decision rendered April 21, 2015.
HENRY C. BREITHAUPT, Judge.
This matter is before the court after briefing by the
parties and a hearing on the scope of proceedings following
the decision and appellate judgment of the Oregon Supreme
Court.
Cite as 22 OTR 64 (2015) 65
A. Scope of Remand
The court decided at the hearing that the position
of the Department of Revenue (the department) was with-
out merit as to the scope of remand. That position was that
with the exception of taxpayer’s claim as to Measure 50, all
other claims for relief contained in taxpayer’s amended com-
plaint could not be considered—based on the actions taken
by the Supreme Court. The department bases its position,
in part, on what appears to be its self-invented distinction
between “claims” and “arguments.” The department ignores
that each of the objections made by taxpayer was denom-
inated in its pleadings as a separate claim for relief. The
position of the department is that taxpayer made only one
claim, namely for “relief from central assessment of its prop-
erty.” The department then argues that while there may
have been several arguments in support of that one claim,
the general judgment of this court must have disposed of
that claim.
That position ignores the fact that this court’s
determination in favor of taxpayer of the statutory claims,
or arguments (if one adopts the lexicon of the department),
rendered moot the remaining claims or arguments. Those
claims, or arguments, properly raised issues about federal
statutory limitations as well as state and federal constitu-
tional limitations that needed to be decided, if but only if, as
did not occur in this court, the statutory claims or arguments
were decided against taxpayer.
The department’s arguments stand the famous
Oregon doctrine of “first things first,” on its head. The
department would punish a taxpayer when, as here, tax-
payer succeeds on a statutory claim or argument and the
court, following the “first things first” doctrine, does not go
on to rule on moot state and federal constitutional claims
that have relevance only if, as did not occur here, the tax-
payer loses the statutory claims or arguments.
The department next argues that the actions of the
Supreme Court compel the conclusion for which the depart-
ment argues. That position is grounded on how the Supreme
Court responded to the request of, ironically, the department
66 Comcast Corp. II v. Dept. of Rev. (TC 4909)
with respect to one of the claims or arguments: the Measure
50 claim or argument.
The department attempted to have the court decide
the Measure 50 issue after the statutory claim or argument
had been resolved by the Supreme Court. Noting that the
Measure 50 disagreement of the parties was not rendered
moot by its conclusions on the statutory claim of taxpayer,
the Supreme Court nevertheless declined to address the
Measure 50 claim. Comcast Corp. v. Dept. of Rev., 356 Or
282, 334, 337 P3d 768 (2014). In so doing, the Supreme Court
noted that this court had not resolved that dispute. Id. The
court then stated that the case was remanded to this court
for further proceedings. Id. at 335.
Taxpayer then became aware that the department
might argue the position it now takes. Taxpayer requested
that the Supreme Court clarify its remand and the effect on
all claims or arguments of taxpayer left unresolved by this
court and not rendered moot by the decision of the Supreme
Court. The Supreme Court, without any explanation, denied
that request.
From such silence the department concludes that
the Supreme Court, having discussed the Measure 50
claim at the request of the department, must have meant
to limit the remand to only that claim. Such an argument
would mean that the department would control the scope
of remand by deciding which of several issues still to be
decided after its victory it had chosen to ask the Supreme
Court to decide.
The error in the department’s position can be seen
in that, if it is accepted, taxpayers would be put in a strange
position. A taxpayer, victorious in this court as to a con-
clusive statutory claim or argument would be required to
assign as error federal statutory, as well as state and fed-
eral constitutional, claims or arguments not decided here.
Otherwise, if its victory on statutory grounds is reversed,
the taxpayer would be precluded from getting a decision on
federal statutory as well as state and federal constitutional
claims or arguments never resolved by this court and not
addressed by the Supreme Court.
Cite as 22 OTR 64 (2015) 67
If such a tortuous path is required, this court would
expect that to be reflected in statute, the rules of appellate
procedure, or prior case law. The department could point to
no such authority to support its position.
The simple fact is that the Supreme Court took
no action that supports the position of the department.
Although the department attempted to have the Supreme
Court address the Measure 50 issue on appeal, the Supreme
Court declined to do so. The Supreme Court recognized that
its decision did not render the Measure 50 claim moot and
that it should be decided initially by this court. The other
claims of taxpayer on which it now seeks a decision occupy
a position exactly parallel to the Measure 50 claim or argu-
ment. They were irrelevant, and not decided by this court
given the decision on the statutory claims or arguments but
now have potentially decisive relevance following the deci-
sion of the Supreme Court on the statutory claims.
Acceptance of the department’s reading of the
actions of the Supreme Court, including its silence as to
reasons for not addressing taxpayer’s request for clarifi-
cation, results in a fundamental violation of due process
rights of taxpayer. The department’s argument, if accepted,
would result in there being no decision, by this court or the
Supreme Court, on claims or arguments raised but, in accor-
dance with existing law and procedure (including the doc-
trine of avoidance as to constitutional issues), not decided by
any court. Other than its own reading of the actions of the
Supreme Court, some of which were described incorrectly by
it, the department gave no constitutional, statutory or case
law support for its position.
B. Further Proceedings
After concession by taxpayer as to its issue preclu-
sion claim, there remain taxpayer’s discrimination claims
under the Oregon and federal constitutions, taxpayer’s
claim under the Internet Tax Freedom Act and taxpayer’s
claim under Measure 50.
The process for further briefing of legal issues and
discovery as to certain factual matters was discussed at the
68 Comcast Corp. II v. Dept. of Rev. (TC 4909)
hearing and the record of the hearing is the guide for the
parties until further notice. Now, therefore,
IT IS ORDERED that parties should proceed as
directed at the hearing on this matter.