[00:00:41] Speaker 00:
Next case is Charleston Area Medical Center at Al versus the United States, 2018-22-26.

[00:00:47] Speaker 00:
Mr. Sykes.

[00:00:48] Speaker 00:
Thank you, your honor.

[00:00:57] Speaker 04:
I wish to reserve three minutes, if that's OK.

[00:01:01] Speaker 04:
May it please the court?

[00:01:02] Speaker 04:
As to the tax issue, I want to make just three points.

[00:01:06] Speaker 04:
First, that the absence of a C modifier

[00:01:11] Speaker 04:
before the corporation term.

[00:01:14] Speaker 04:
And really, that's why we're here.

[00:01:15] Speaker 04:
If Congress had put a C modifier into 6621A1, I don't think we'd be here at all.

[00:01:23] Speaker 04:
But in its amendment, it didn't put that.

[00:01:27] Speaker 04:
But the absence of a C modifier does not justify the leap to the broadest possible meaning for the ambiguous term

[00:01:40] Speaker 04:
corporation.

[00:01:41] Speaker 04:
Corporation under the Internal Revenue Code has at least four distinct meanings and more combinations of meaning.

[00:01:50] Speaker 04:
It can be S corporations, C corporations, state-owned corporations, nonprofit corporations, a lot of different types of corporations.

[00:01:58] Speaker 01:
You're here trying to ask us to create a circuit split with a number of other circuits who have already addressed this question and ruled against your position, correct?

[00:02:08] Speaker 04:
Yes, and I believe those cases are wrong for reasons I'll explain.

[00:02:16] Speaker 04:
A very large reason is that we now have the benefit of notice 2018-18 where the IRS refutes, doesn't follow the Rossello rule and those prior decisions have pivoted

[00:02:32] Speaker 04:
in a fundamental way on the Rossello rule.

[00:02:36] Speaker 04:
Rossello holds that where you've got disparate terms in a statute and you've got a single enactment, then you draw an inference from that.

[00:02:48] Speaker 04:
Well, as threshold matter, we don't have disparate terms.

[00:02:51] Speaker 04:
We have corporate, used in headings, and the corporation.

[00:02:56] Speaker 04:
Those are adjective and noun forms of one word, corporation.

[00:03:01] Speaker 04:
We don't have a single enactment.

[00:03:04] Speaker 04:
We have an accretive statute which built on, there was a 1990 amendment, 94 amendment, 97, technical correction, and a 1998 amendment.

[00:03:16] Speaker 04:
Take the state of Michigan case for example, which dealt with section 11 under the code.

[00:03:22] Speaker 04:
That's the seminal provision that imposes corporate income tax.

[00:03:26] Speaker 04:
The unadorned term corporation was used.

[00:03:29] Speaker 04:
The Sixth Circuit held that no, that does not encompass state-owned corporations.

[00:03:37] Speaker 04:
The Internal Revenue Code has hundreds of usages of the unadorned term corporation.

[00:03:46] Speaker 04:
where the term does not have an as broad as possible meaning.

[00:03:51] Speaker 04:
That renders the Rossello rule, upon which all these prior courts have pivoted, it renders it inapplicable.

[00:03:59] Speaker 01:
How can we rely on a notice that hasn't even been issued as a new regulation?

[00:04:06] Speaker 04:
Notices are entitled to skid more deference, and a regulation is actually promised.

[00:04:12] Speaker 04:
That notice has been unusual.

[00:04:14] Speaker 04:
Usually notices announce a proposed reg.

[00:04:18] Speaker 04:
This doesn't announce a proposed reg.

[00:04:21] Speaker 04:
It says a regulation will be issued.

[00:04:24] Speaker 04:
So I think it gets skidmore deference.

[00:04:28] Speaker 04:
I think it illustrates what is also visible from looking at the rest of the code, which is that there are hundreds of instances, and this is undisputed, hundreds of instances where the term corporation does not have an as broad as possible meaning.

[00:04:45] Speaker 04:
That is, the leap that has been made by all of these courts

[00:04:49] Speaker 04:
Is is is inappropriate under the structure of the code?

[00:04:54] Speaker 04:
I'm asking this court to look at the structure of the code and We've got rules which so far.

[00:05:01] Speaker 04:
No court has really wanted to recognize requiring liberal construction in favor of the taxpayer and requiring any doubt to be resolved in favor of the taxpayer these courts have not done that respectfully and

[00:05:17] Speaker 04:
They've, as I read them, they're very tough the way they come at the teaching hospitals, construing things, not in a liberal fashion.

[00:05:31] Speaker 01:
Not, not- But we have to find some ambiguity in the statute before we give any deference, right?

[00:05:36] Speaker 04:
Sure, and let me move on to that immediately.

[00:05:40] Speaker 04:
The symmetry principle.

[00:05:42] Speaker 04:
There the cases hold in the tax arena and tax may not be the same as patent.

[00:05:48] Speaker 04:
I mean tax has the most Excuse me Tax has something like 70,000 pages of code and regs and

[00:06:08] Speaker 01:
I think we know that.

[00:06:10] Speaker 04:
Well, what I mean to say is that the rules, the judicial rules are special and they're designed to deal with a statute that is modified repeatedly.

[00:06:25] Speaker 00:
We do have tax cases.

[00:06:28] Speaker 04:
Of course you do.

[00:06:30] Speaker 04:
I actually worked in the Court of Federal Claims section of DOJ for 14 years.

[00:06:36] Speaker 04:
And I'm very familiar with this court, actually.

[00:06:43] Speaker 04:
So the one rule that may strike the court, and I think has been difficult for the district courts to accept, is that legislative history continues in the tax arena to play an important role.

[00:07:01] Speaker 04:
We've got Supreme Court cases, I've cited them.

[00:07:04] Speaker 04:
And they say that legislative history must be considered.

[00:07:10] Speaker 04:
Textual history, as distinct from legislative history, must be considered.

[00:07:16] Speaker 04:
And I don't think, I think the courts took a 1999 snapshot of the statute.

[00:07:21] Speaker 00:
Look, it's in a statute, 6621, which refers to a corporation.

[00:07:26] Speaker 00:
7701.

[00:07:30] Speaker 00:
is a broad definition.

[00:07:32] Speaker 00:
It includes joint stock companies but it is not limiting to those companies and therefore it must be interpreted broadly to include non-profits.

[00:07:46] Speaker 04:
I don't agree with the idea that 77, I'll start with 7701, that 7701 has to be construed broadly.

[00:07:55] Speaker 04:
Congress could have put into 7701 a reference to, if it's a state law corporation, it's a corporation for purposes of the internal revenue code.

[00:08:07] Speaker 04:
Didn't do that.

[00:08:08] Speaker 01:
But the common law understanding of corporation included nonprofit corporations, did it not?

[00:08:14] Speaker 04:
Again, Congress in 7701, the dictionary statute refrained.

[00:08:20] Speaker 04:
Why did Congress refrain from putting that in?

[00:08:22] Speaker 04:
And the reason is that across the code, there are usages of corporation that vary.

[00:08:29] Speaker 01:
They go from... Right, so those are specifically defined forms of corporations.

[00:08:35] Speaker 01:
That doesn't change the fact that you still apply the common meaning to corporation, right?

[00:08:42] Speaker 04:
No, I don't think ordinary, if one wants to get into ordinary and common meaning, I'm happy to do that because the IRS's website, for example, says that these are called charitable organizations.

[00:08:57] Speaker 04:
In ordinary and common meaning, these are called non-profits.

[00:09:01] Speaker 04:
No one runs around saying that an incorporated

[00:09:07] Speaker 04:
charitable organization, and that's the phrase that the IRS itself uses, charitable organization, that an incorporated charitable organization is a corporation.

[00:09:17] Speaker 04:
People don't talk about the United Way as being a corporation.

[00:09:21] Speaker 01:
But you're incorporated under state law, right?

[00:09:25] Speaker 04:
Oh yes, we don't dispute that we are.

[00:09:27] Speaker 01:
So you're saying that by using the word corporation, Congress intended to exclude certain corporations from that word.

[00:09:36] Speaker 04:
I'm sorry, I didn't follow.

[00:09:38] Speaker 01:
But in the statute, they use the word corporation.

[00:09:41] Speaker 01:
And you're saying, well, they could have put in including nonprofit corporations.

[00:09:45] Speaker 01:
But they also could have excluded nonprofit corporations, correct?

[00:09:48] Speaker 04:
They didn't say every corporation.

[00:09:52] Speaker 04:
We already have.

[00:09:53] Speaker 04:
Congress didn't need to set out.

[00:09:56] Speaker 03:
So are you basically disputing the proposition that corporation

[00:10:02] Speaker 03:
is a generic term for all the different types of corporations, C corporations, S corporations, et cetera?

[00:10:10] Speaker 04:
Yes, in hundreds of places.

[00:10:12] Speaker 03:
I'm trying to figure out 6621A1 says corporation.

[00:10:19] Speaker 03:
It doesn't say C corporation.

[00:10:22] Speaker 03:
And you're asking us to read the word corporation in 6621A1 to translate it to really mean C corporation.

[00:10:31] Speaker 03:
And I don't know if we're allowed to do that.

[00:10:33] Speaker 03:
Well, you're back to Rossello.

[00:10:35] Speaker 03:
Congress knows how to say C corporation.

[00:10:38] Speaker 03:
It said it in 6B, 621C, and then many, many, many other places.

[00:10:45] Speaker 03:
And it knows how to say S corporation and so forth.

[00:10:48] Speaker 03:
And then it also knows how to say just land link corporation.

[00:10:52] Speaker 03:
And every court I'm aware of has read the more bland

[00:10:59] Speaker 03:
version of just saying corporation to encompass all corporations, and not just restrictively read that term to mean just C corporations.

[00:11:11] Speaker 03:
So that's, I think, the challenge you have.

[00:11:14] Speaker 04:
Well, it is.

[00:11:15] Speaker 04:
And that's why I started out by talking about Rossello, because it's the Rossello concept.

[00:11:21] Speaker 03:
I'm talking about traditional tools of statutory construction principles here that's

[00:11:28] Speaker 03:
making me resist the idea of inserting the letter C in front of the word corporation in the statutory text that we need to interpret here.

[00:11:38] Speaker 04:
Congress, in hundreds of places, obviously used corporation as having a less than fully expansive meaning.

[00:11:51] Speaker 04:
They wanted to leave it to the Treasury Department

[00:11:55] Speaker 04:
to write regs defining the scope.

[00:11:58] Speaker 04:
And this new notice illustrates this very vividly.

[00:12:01] Speaker 04:
2018-18 says that they will issue a reg which says that corporation, in this instance, even though that same enactment, the same enactment, Tax Cuts and Jobs Act of late 2017, in other places uses S-Corp,

[00:12:21] Speaker 04:
uses C-Corp, and then in this statute it uses the word corporation.

[00:12:25] Speaker 04:
And Congress wanted to leave, apparently, Treasury free.

[00:12:31] Speaker 04:
You are handcuffing Treasury.

[00:12:35] Speaker 04:
by imposing this notion that everywhere the state, the word corporation appears, it has to have an as broad as possible meaning.

[00:12:45] Speaker 04:
This is going to backfire on Treasury.

[00:12:47] Speaker 01:
So you're saying that the, well, the new regulation or the new notice might backfire on Treasury too.

[00:12:54] Speaker 01:
So I mean, because you're saying that Congress intended to delegate to the IRS the right to rewrite terms used in the statute.

[00:13:04] Speaker 04:
They're not rewriting it.

[00:13:10] Speaker 01:
How can that be so?

[00:13:11] Speaker 04:
The recillo, number one, recillo doesn't even apply because you don't have disparate terms.

[00:13:17] Speaker 04:
I want to make sure I'm clear on that.

[00:13:20] Speaker 04:
This doesn't even fall within recillo.

[00:13:23] Speaker 04:
You don't have disparate terms because we have the word, the unadorned word corporate.

[00:13:29] Speaker 04:
They could have said in the black letter headings, C corporation.

[00:13:33] Speaker 04:
They didn't.

[00:13:34] Speaker 04:
Instead, that appears in a subparagraph definition.

[00:13:39] Speaker 04:
We also don't have a simultaneous enactment.

[00:13:44] Speaker 04:
We have accretive enactments.

[00:13:46] Speaker 04:
accretive enactments are treated differently.

[00:13:50] Speaker 04:
There are less strong situations for imposing what this court may be thinking, well, what prior courts thought should be imposed.

[00:14:07] Speaker 04:
Well, the last thing, I would say that, and thank you for reminding me,

[00:14:17] Speaker 04:
the IRS is taking a position that's inconsistent with its notice and a promised reg.

[00:14:22] Speaker 04:
It's inconsistent with hundreds of provisions in the code which define corporation in a less than fully expansive manner and you simply can't do that.

[00:14:36] Speaker 04:
The last thing I'd say is that rule 23

[00:14:40] Speaker 04:
discussion where the court wouldn't even address Rule 23.

[00:14:44] Speaker 04:
That's just obviously wrong under Amgen.

[00:14:48] Speaker 04:
It requires two trips to the Court of Appeals.

[00:14:51] Speaker 04:
So thank you.

[00:14:54] Speaker 00:
Ms.

[00:14:54] Speaker 00:
Ruben.

[00:14:57] Speaker 01:
Can you start with the IRS notice?

[00:15:00] Speaker 01:
I guess I really don't understand how the IRS can choose to rewrite the word corporation if it's standing up here telling us that the word corporation

[00:15:10] Speaker 01:
It has a broad meaning and a common law meaning, and it shouldn't be altered.

[00:15:15] Speaker 02:
I think we're going to have to see what those regulations look like, because that deals with a completely separate statute.

[00:15:22] Speaker 02:
And actually, notice 2018-18 says that whatever they do in those proposed regulations, which have not been enacted, and we don't know what they look like, would be limited to the effect on 1061.

[00:15:35] Speaker 01:
So we'll have to see what the regulations look like and whether they... Does 1061 use the word corporation?

[00:15:41] Speaker 01:
It certainly does, and as I understand... So you're saying we can limit our rewriting of a statutory term in one section of the code and it doesn't affect the rewriting of that statutory term in another section?

[00:15:54] Speaker 02:
I guess what I'm saying is this.

[00:15:56] Speaker 02:
I don't know what the basis is that the IRS would use.

[00:15:59] Speaker 02:
to justify the regulations.

[00:16:02] Speaker 02:
I don't know the language they would use in the regulations.

[00:16:04] Speaker 01:
And so I don't know how I can defend regulations that don't exist.

[00:16:12] Speaker 01:
as corporations from the definition of corporation.

[00:16:14] Speaker 02:
Right.

[00:16:15] Speaker 02:
But I don't know what basis they're trying to use for that.

[00:16:17] Speaker 02:
And I don't know what I would say to try to defend these regulations that don't even exist.

[00:16:22] Speaker 02:
What I do know how to defend is a statute that uses a generic term, corporation, which has historically and ordinarily been used to cover all corporations.

[00:16:34] Speaker 02:
And so.

[00:16:35] Speaker 03:
So would you agree, then, if Treasury tried to write a regulation that redefined the word

[00:16:40] Speaker 03:
regulation, I mean, corporation to exclude S corporations, that would be invalid?

[00:16:47] Speaker 02:
I would need to see what the basis was.

[00:16:49] Speaker 02:
I mean, I don't want to stand here and tell you that some regulations that don't exist yet are invalid.

[00:16:53] Speaker 03:
Right, but your argument to us, to follow up on Judge O'Malley's question, is that the term corporation as it's used in the tax code is unambiguous, and it covers

[00:17:03] Speaker 03:
all forms of corporations, profit and non-profit.

[00:17:06] Speaker 02:
Well, certainly, if you look at... Right?

[00:17:08] Speaker 03:
I mean, let's start with that.

[00:17:09] Speaker 02:
Okay.

[00:17:09] Speaker 03:
That's your argument, right?

[00:17:11] Speaker 02:
My argument is that unless the statute... Where am I wrong with my understanding of your argument?

[00:17:15] Speaker 02:
Let's look at the preamble to Section 7701.

[00:17:18] Speaker 03:
Did I say something wrong in explaining your position about the relative ambiguity or unambiguity of the term corporation as it's used in the tax code?

[00:17:26] Speaker 02:
Whenever 7701A3 applies, that is our position.

[00:17:30] Speaker 02:
7701... Let's take a hypothetical.

[00:17:33] Speaker 01:
Assume the regulation says that S corporations will be excluded from the term corporation, and it doesn't apply specifically to 7701.

[00:17:45] Speaker 01:
It applies across the board to the tax code.

[00:17:49] Speaker 01:
Would that be a valid exercise of their regulatory authority?

[00:17:56] Speaker 02:
So you're saying that they would use this regulation to somehow rewrite 7701A3 so that it no longer includes S corporations, because that's what they would need to do for that to happen.

[00:18:08] Speaker 02:
Right, and 1061.

[00:18:10] Speaker 02:
And what I would say is in the United States versus NP case,

[00:18:15] Speaker 02:
What had happened there was there was an amendment done to the regulations interpreting Section 7701 that attempted to say a certain category of state-incorporated corporations were not corporations for purposes of the tax code.

[00:18:31] Speaker 02:
What the court said was, no, no, no, there's a long-standing administrative practice

[00:18:35] Speaker 02:
that the term corporation includes all state-incorporated corporations, and it's been legislatively reenacted numerous times from Section 7701A3 has been reenacted 11 times.

[00:18:51] Speaker 01:
If you're trying to answer any question, 1061 uses the word corporation as a fact.

[00:18:58] Speaker 02:
What I'm saying is I don't think that any regulation, if you follow the reasoning of MP, I do not believe that any regulation

[00:19:05] Speaker 02:
who had changed the meaning of corporation to exclude state incorporated corporations from the generic definition of corporation.

[00:19:16] Speaker 01:
Could there be a regulation that says we're going to exclude nonprofit corporations from the definition of corporation anywhere in the tax code?

[00:19:25] Speaker 01:
Could they do that?

[00:19:26] Speaker 02:
I don't think they could change the meaning under Section 7701A3.

[00:19:31] Speaker 01:
Now, if you look at the preamble... Are they going to change the meaning under other provisions?

[00:19:36] Speaker 02:
There have been times when the regulations have been issued that excluded non-profit corporations.

[00:19:43] Speaker 02:
We even cite some of them in our brief, including look at the former, let's see, look at Treasury Regulation 1.337D-7, where the IRS and the Treasury Regulation said,

[00:19:55] Speaker 02:
For purposes of this provision, these rules that apply to C corporations do not apply to non-profit corporations.

[00:20:03] Speaker 02:
But I wanted to just, if I could, just get back to that preamble to section 7701A3, to 7701.

[00:20:11] Speaker 02:
And what that says is that these definitions apply throughout the code unless a particular statute

[00:20:17] Speaker 02:
distinctly expresses a different definition or the definition contained in here is somehow inconsistent with congressional intent.

[00:20:26] Speaker 02:
So all I'm saying is I need to see the regulations that would come out of interpreting section 1061 to see if somehow they explain that, hey, the generic definition

[00:20:38] Speaker 02:
that's found in section 7701A3, which is not an issue, which cannot, as I understand it, under the MPB, be changed by any regulations, that it is somehow inconsistent with congressional intent.

[00:20:50] Speaker 02:
And I certainly am not, you know, waiving the government's ability to argue that any regulations that might be enacted under 1061 are permissible under the preamble to section 7701A3.

[00:21:03] Speaker 02:
But the thing is, is that in this case,

[00:21:06] Speaker 02:
nothing in section 6621A3 is inconsistent or specifically states an alternative definition to the broad definition found in 7701A3.

[00:21:19] Speaker 02:
And so in this case, dealing with this provision, what we have is the use of the plain word corporation.

[00:21:28] Speaker 02:
And that plain word has long been understood for well over 100 years to mean in the terms of the Internal Revenue Code, all corporations including non-profits.

[00:21:41] Speaker 02:
And section 710A3 says, well, corporation also includes certain other things.

[00:21:48] Speaker 02:
So while I agree that there's a generic term that in common usage would mean any state-incorporated entity,

[00:21:55] Speaker 02:
In terms of the Internal Revenue Code, it's actually broader because there are some unincorporated entities that are considered corporations for purposes of the Internal Revenue Code, and those are stated in Section 7701A3.

[00:22:09] Speaker 02:
To be sure, there have been regulations that have been put forth to try to guide how

[00:22:15] Speaker 02:
unincorporated entities are treated as corporations, if they're treated as corporations or not, those have been argued extensively in the briefs.

[00:22:24] Speaker 02:
We would say while under those regulations, such as state-incorporated entity, such as these corporations who are taxpayers here, are considered to be corporations under those regulations as well, they're not really relevant.

[00:22:39] Speaker 00:
Four other circuits have decided this case.

[00:22:43] Speaker 00:
Have they relied on a common ground or definition?

[00:22:50] Speaker 02:
I would say so, yes.

[00:22:52] Speaker 02:
I mean, I think if you look at them, all of them agree that under the ordinary meaning of corporation, it includes nonprofits.

[00:23:00] Speaker 02:
All of them agree that Section 7701A3 includes all incorporated entities and that the language in it simply expands the definition beyond the common meaning to include certain unincorporated entities.

[00:23:15] Speaker 00:
Your position would be helped

[00:23:19] Speaker 00:
if 7701A3 also includes the word also.

[00:23:27] Speaker 02:
Right, but that's it's not the only place where that sort of definition has been done.

[00:23:31] Speaker 02:
If you look at 7701A10, state is defined as including the District of Columbia, but I think we can all agree that for the Internal Revenue Code, you know, state also includes the state of Maryland and the state of Virginia.

[00:23:44] Speaker 02:
So

[00:23:47] Speaker 02:
Every court that has looked at this question has determined that by saying it includes these terms, it didn't say, but it doesn't include the commonly understood meaning of corporation.

[00:23:57] Speaker 00:
What about 501C3?

[00:23:59] Speaker 00:
What does that do for you?

[00:24:04] Speaker 02:
501C3 I think is actually extremely helpful for us because what it shows is that there's an understanding that a corporation can be a nonprofit which is why they needed to actually exclude nonprofit corporations

[00:24:17] Speaker 02:
from being subject to income tax, unless, of course, they have unrelated business income, which is then taxable just like any other corporation's income would be.

[00:24:30] Speaker 02:
And that's under Section 511.

[00:24:32] Speaker 01:
Those other cases that you rely on from the other circuits, they didn't address every single issue that is raised here, did they?

[00:24:41] Speaker 02:
No, but I think just about all these issues were raised.

[00:24:44] Speaker 02:
And I think if you sort of look at all four of the cases, I think they cover an awful lot of them.

[00:24:49] Speaker 02:
You know, I think notice 2018-18 was discussed briefly in the Wichita case, which said, hey, you've cited all this post

[00:25:01] Speaker 02:
enactment legislative history in a 28-J letter, which was then cited in the reply group, they said, this is irrelevant.

[00:25:08] Speaker 02:
It's dealing with a different provision and unenacted regulations that aren't at issue here.

[00:25:15] Speaker 01:
You know, you look at the, I believe also, which... Aren't we supposed to assume, though, that at least across the code, where there isn't a distinction drawn, that use of the same word gets the same treatment?

[00:25:30] Speaker 02:
Again, unless it would be inconsistent with congressional intent.

[00:25:36] Speaker 02:
Now, I do agree that where, like with 6621A1, there's no basis to say that there was either a definition set forth for corporation or that the general definition for corporation is somehow inconsistent with intent.

[00:25:51] Speaker 02:
Yes, you should apply the same definition throughout.

[00:25:57] Speaker 02:
I guess what I would say is if you were to look at any particular other use of a term that is defined in 7701, you would need to do that analysis.

[00:26:06] Speaker 02:
In this case, we did that analysis and the courts have done that analysis and the courts before you have looked at it and said,

[00:26:12] Speaker 02:
Look, this is completely consistent with the common understanding of the language.

[00:26:20] Speaker 02:
It's consistent with the definition in the Internal Revenue Code.

[00:26:24] Speaker 02:
It's consistent with the structure here, where 6621A1 says, you know, this lower corporate overpayment rate is applicable to all corporations.

[00:26:35] Speaker 02:
And unlike in 6621C1, where

[00:26:42] Speaker 02:
C3, where instead large corporate underpayment is defined as only applying to C corporations, and that's where Rusella really comes in, is to say, look, you've got, Congress has made decisions here to use the term corporation in one provision, and then you use C corporation in the other.

[00:27:02] Speaker 00:
What is a C corporation?

[00:27:04] Speaker 00:
Anything but an S?

[00:27:06] Speaker 02:
It's anything but an S. So we would actually say that even if you were to say, OK, we're going to use C corporation throughout 6621, well, these hospitals are not S corporations.

[00:27:18] Speaker 02:
They are corporations.

[00:27:19] Speaker 02:
So they must be a C corporation.

[00:27:21] Speaker 02:
Because any corporation that's not an S corporation under section 1361 is a C corporation.

[00:27:30] Speaker 02:
So under either interpretation, ultimately,

[00:27:35] Speaker 02:
it doesn't really matter because the corporate overpayment rate applies to these corporations, which everyone agrees are corporations.

[00:27:45] Speaker 02:
Are there any further questions on the 6621 issue?

[00:27:54] Speaker 02:
Are there any questions on the class certification issue, which we believe is fully resolved by the Greenlee case?

[00:27:59] Speaker 00:
If we had questions, we would volunteer them.

[00:28:03] Speaker 00:
Is there anything else you wish to say?

[00:28:06] Speaker 02:
No.

[00:28:06] Speaker 02:
For the reasons stated in our brief, as well as all the reasons stated in the second, sixth, seventh, and tenth circuit opinions, we believe you should affirm.

[00:28:13] Speaker 00:
Thank you.

[00:28:16] Speaker 00:
Mr. Seitz, we've got a minute.

[00:28:19] Speaker 04:
Well, they've admitted that they lose.

[00:28:22] Speaker 04:
Why is that?

[00:28:22] Speaker 04:
Because they say that they need to have the reg under 1061, this promised reg.

[00:28:28] Speaker 04:
They need to have that before them to determine whether the reg is valid.

[00:28:32] Speaker 04:
That means that corporation permits a definition that excludes S corporations.

[00:28:40] Speaker 04:
Corporation is ambiguous.

[00:28:42] Speaker 04:
Ambiguity favors us.

[00:28:44] Speaker 04:
All doubt must be resolved in favor of us.

[00:28:47] Speaker 04:
Second point, the Internal Revenue Code was codified 1939, 1954, 1986.

[00:28:54] Speaker 04:
Congress didn't go through the hundreds of provisions and insert modifiers.

[00:28:59] Speaker 04:
It left them the way they were.

[00:29:00] Speaker 04:
It could have done that, didn't do that.

[00:29:04] Speaker 01:
hesitate to agree with your proposition that that was a concession as to ambiguity.

[00:29:09] Speaker 01:
I mean, if anything, it was just counsel trying not to lock someone else in in a different case.

[00:29:15] Speaker 01:
And there was an admission that it should be, that barring the circumstances that would normally allow you to read a word other than in its generic form, then you have to read it in its generic form.

[00:29:27] Speaker 01:
I mean, to the extent there was any concession, it was the opposite.

[00:29:31] Speaker 04:
I used to work for DOJ.

[00:29:32] Speaker 04:
I understand what was going on.

[00:29:34] Speaker 04:
I still think it's a concession that there's ambiguity.

[00:29:39] Speaker 04:
Thank you.

[00:29:40] Speaker 00:
Thank you, Council.

[00:29:42] Speaker 00:
The case is submitted.