Free Joint Status Report - District Court of Federal Claims - federal

Case 1:05-cv-01019-LMB

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Filed 07/19/2007

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS ______________ No. 05-1019 T (JUDGE BASKIR) FASTNET CORPORATION, ET AL., Plaintiff v. THE UNITED STATES, Defendant ______________ SUPPLEMENTAL JOINT STATUS REPORT ______________ Pursuant to the Court's Order, filed on August 22, 2006, in the above-referenced matter, the parties submit the following information: In XO Communications v. United States, Fed Cl. No. 03-2754 T (2003), Plaintiff and the United States completed discovery. In addition, the parties in XO have filed cross-motions for summary judgment on the "Dial Access" issue, which is substantially similar to the issue involved in this action. In addition, Judge Williams has conducted an expert witness hearing on the "Dial Access" issue and the parties subsequently submitted supplemental briefs. This case was transferred to Judge Wheeler on July 24, 2006, and supplemental briefs were filed on November 9th and 10th addressing the extent to which the Internal Revenue Service ("IRS") currently imposes a tax on Internet access and related Internet communications. On January 10, 2007, an Order was filed denying the parties' cross-motions for summary judgment and ordering

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Case 1:05-cv-01019-LMB

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Filed 07/19/2007

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the parties to recommend further proceedings. On May 4, 2007, the parties filed a Joint Status Report requesting additional time to allow defendant's counsel to travel to plaintiff's counsel's offices during the week of May 21, 2007, to conduct a review of documents. On July 3, 2007, the parties filed a Joint Status Report requesting an additional period of 66 days, until September 7, 2007, in which to finalize their examination of the records and to consult to formulate a plan for further proceedings. Once the parties complete their examination, they will be able to provide a recommendation for further proceedings, including whether a trial will be necessary to resolve any factual matters. In Comcation v. United States, Fed Cl. No. 05-515 T (2005), Plaintiff and the United States completed discovery. A trial was held on September 11, 2006. The parties' simultaneous opening post trial briefs were filed on November 13, 2006, and the parties' simultaneous reply briefs were filed on December 13, 2006. Closing arguments occurred on January 9, 2007, and a decision in this matter is forthcoming. In USA Choice v. United States, Fed Cl. No. 05-525 T (2005), Judge Lettow awarded the Plaintiff judgment insofar as it paid communications excise taxes from January 1999 through April 2002 on incoming-only PRI channels purchased from ALLTEL and Verizon and its predecessors and on private-communication DCS and BRA channels obtained from ALLTEL plus the private lines associated with specific telephone numbers. Judge Lettow held that charges for these channels and services are not taxable as local telephone service, in the first instance because the services are not covered by the definition of such service in the Internal Revenue Code, and in the second instance because the services are exempted from the definition. Final Judgment was entered for the Plaintiff in this case on December 15, 2006, in the amount of -2-

Case 1:05-cv-01019-LMB

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Filed 07/19/2007

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$20,625.76. The case was docketed at the United States Court of Appeals for the Federal Circuit on February 28, 2007. The docket number is 2007-5077. The brief of the United States was filed on June 13, 2007. Plaintiff's brief is forthcoming. Respectfully submitted, July 19, 2007 Date s/Anthony C. Gulotta ANTHONY C. GULOTTA Anderson & Gulotta, P.C. 1110 North Mountain Road Harrisburg, PA 17112 (717) 635-7145 Fax (717) 541-5434 [email protected] Attorney for Plaintiff

July 19, 2007 Date

s/G. Robson Stewart G. ROBSON STEWART Attorney of Record U.S. Department of Justice Tax Division Court of Federal Claims Section Post Office Box 26 Ben Franklin Post Office Washington, D.C. 20044 (202) 307-6493 RICHARD T. MORRISON Acting Assistant Attorney General DAVID GUSTAFSON Chief, Court of Federal Claims Section STEVEN I. FRAHM Assistant Chief

July 19, 2007 Date

s/Steven I. Frahm Of Counsel Attorneys for Defendant

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