Free Notice of Additional Authority - District Court of Federal Claims - federal

Case 1:05-cv-00231-EJD

Document 187

Filed 08/12/2008

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS No. 05-231 T (Chief Judge Damich) ______________________________ JZ Buckingham Investments LLC as Tax Matters Partner of JBJZ Partners, a South Carolina general partnership, Plaintiff, v. United States of America, Defendant. __________________________ NOTICE OF RELEVANT JUDICIAL DECISION
PLEASE TAKE NOTICE THAT in the spirit of Federal Rule of Appellate Procedure Rule 28(j), the United States hereby informs the Court that, on July 31, 2008, The United States Court of Federal Claims entered a final decision in the matter of Stobie Creek Investments, LLC, v. United States, Nos. 05-748T and 07-520T (Fed.Cl. July 31, 2008), which involved an issue as to the validity of that Treas. Reg. § 1.752-6 (the "Regulation"). The Court held that the Regulation was invalid as applied retroactively. The Court determined that Section 309 of the Community Renewal Tax Relief Act of 2000 did not authorize the Regulation because, in the Court's view, the Regulation did not address either acceleration or duplication of losses. Therefore, the Court found that the Regulation was not owed Chevron deference.

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Case 1:05-cv-00231-EJD

Document 187

Filed 08/12/2008

Page 2 of 3

The United States respectfully disagrees with the Court's holding regarding the Regulation. The Regulation can indeed apply, as here, to a circumstance where losses are duplicated, once at the partnership level when the options expire or are terminated and again on the sale of the property whose inflated basis is derived from the long option. Even, if, however, Section 309 did not authorize the Regulation and the Regulation were therefore interpretive, it is the position of the United States, for the reasons outlined in Part G of the United States' SurReply Memorandum, DE #181, the Regulation is nevertheless entitled to Chevron deference. The Court may wish the parties to address this issue in supplemental briefs. A copy of the decision in annexed hereto.

Respectfully submitted, s/ Dennis M. Donohue DENNIS M. DONOHUE Attorney of Record U.S. Department of Justice - Tax Division Post Office Box 403 Ben Franklin Station Washington, D.C. 20044 (202) 307-6492

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Case 1:05-cv-00231-EJD

Document 187

Filed 08/12/2008

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CERTIFICATE OF SERVICE I hereby certify that on August 12, 2008, I electronically filed the foregoing Notice with the Clerk of the Court using the ECF system which will send notification of such filing to the following: Joel N. Crouch Texas State Bar No. 05144220 Meadows, Owens, Collier, Reed Cousins & Blau, L.L.P. 901 Main Street, Suite 3700 Dallas, Texas 75202 s/ David M. Steiner David M. Steiner Trial Attorney, Tax Division U.S. Department of Justice Post Office Box 55 Ben Franklin Station Washington, D.C. 20044 (202) 307-5892

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