Business groups obtain invalidation of IRS anti-inversion regulations
Clients U.S. Chamber of Commerce and Texas Association of Business
Jones Day achieved a major victory on behalf of the U.S. Chamber of Commerce and Texas Association of Business when the U.S. District Court for the Western District of Texas invalidated temporary regulations that the IRS promulgated last year to deter a type of corporate transaction known as an "inversion." The court agreed with Jones Day's position that the business groups could pursue the challenge, and that the Anti-Injunction Act did not require corporations to undertake inversions and incur enormous taxes before challenging the rule. On the merits, the court agreed that the IRS violated the Administrative Procedure Act by issuing the rule before giving notice and providing an opportunity for public comment. This is an important victory with significant implications for the regulatory process and taxpayers' ability to challenge IRS regulations.
Chamber of Commerce of the U.S. v. Internal Revenue Service, No. 1:16-cv-944 (W.D. Tex.)