Faegre & Benson's Tax Litigation Highlights

The tax litigation cases below highlight the breadth and depth of our firm's tax litigation practice. Each case description has a corresponding PDF file with greater detail that can be accessed at the bottom of this page.

Case 1

We represented Hutchinson Technology, Inc., before the Minnesota Tax Court and the Minnesota Supreme Court. We successfully argued that the client's foreign sales corporation qualified as a foreign operating company (essentially an 80-20 company) for Minnesota income tax purposes, and that the client was entitled to a dividends received deduction, as well as a deduction for fees received from the foreign sales corporation. Hutchinson Technology Inc. v. Commissioner of Revenue, Nos. A04-1245 and A04-1247 (Mn. S. Ct. 2005).

Case 2

We represented Wells Fargo & Company in the Eighth Circuit Court of Appeals, in a case holding that amounts paid by an acquired company (Davenport Bank & Trust Company) to its officers and advisers for merger-related services were properly deducted and did not have to be capitalized. Wells Fargo & Co. v. Commissioner, 224 F.3rd 874 (8th Cir. 2000).

Case 3

We represented Wells Fargo & Company before the United States Tax Court in a case involving contributions to a post-retirement medical plan (i.e., a VEBA). The case concerned the definition of the account limit under I.R.C. § 419A, and whether Wells Fargo could deduct in full amounts contributed for already-retired employees. The Tax Court upheld the deduction. Wells Fargo & Co. v. Commissioner, 120 T.C. 69 (2003).

Case 4

We represented an individual taxpayer in a charitable contribution case. The taxpayer contributed warrants to four charities at a time when a deal to acquire the corporate issuer of the warrants was pending. The charities sold the warrants to the prospective acquiring company soon after the gifts were made. The Tax Court rejected the IRS claim that there was an assignment of income, and admonished the Commissioner for making arguments that were contrary to a published revenue ruling. Rauenhorst v. Commissioner, 119 T.C. 157 (2002).

Case 5

We represented BCBSM, Inc. (Blue Cross) in a case awarding refunds of premium taxes on stop-loss coverage. The Minnesota Supreme Court, which upheld the decision of the Minnesota Tax Court in this case, stated that even though the statute was unclear, the ambiguities had to be construed in favor of the taxpayer. BCBSM, Inc. (d.b.a. BlueCross BlueShield of Minnesota) v. Commissioner of Revenue, 663 N.W. 2d 531 (Mn. Sup. Ct. 2003).

Case 6

We represented Wells Fargo & Company in a successful mandamus action against the Commissioner of Revenue in the Minnesota Tax Court. The Commissioner argued that he did not have to act on a pending refund claim because the claim had purportedly been denied in a letter to the taxpayer questioning whether the statute of limitations had expired. The Court held that a claim must be denied in an official order, not an ambiguous letter, and held further that the Commissioner had to act on the claims. Wells Fargo & Company v. Commissioner, No. 7429R (Mn. Tax Ct. 2002)