The brief, which was referenced repeatedly in oral arguments and whose theories greatly influenced the majority opinion, was written on behalf of eight tax economists: Alan D. Viard of the American Enterprise Institute (AEI) for Public Policy Research; Alan J. Auerbach of the University of California, Berkeley; Alex Brill of AEI; Christopher DeMuth of the Hudson Institute; Brian Galle of Boston College Law School; Kevin A. Hassett of AEI; R. Glenn Hubbard of Columbia University; and Robert J. Shapiro of Sonecon LLC.
The primary theory in the brief was that Maryland's income tax regime, which did not allow residents to take a credit against the county portion of the Maryland income tax for taxes paid to other states, violated internal consistency by systematically taxing interstate commerce more heavily than economic activity conducted entirely within Maryland. The brief, which cast the scheme in terms of a tariff, was apparently persuasive to Justice Samuel A. Alito Jr., who raised the issue in oral arguments and eventually wrote the majority opinion.
Viard says the theory, which is similar to one independently developed by economists Ruth Mason and Michael S. Knoll, is one he's advocated for some time. He made a similar argument as an amicus in Department of Revenue of Kentucky v. Davis, 533 U.S. 328 (2008), although in that case, the Court declined to follow his reasoning. The Davis brief was also coauthored by David Daniels and others at Richards Kibbe & Orbe, and Viard said he "never really considered anyone else" when he decided to file an amicus in Wynne.
Karl Frieden, vice president and general counsel at the Council On State Taxation, said that although the brief was part of a number of things that influenced the Court's decision, it was "certainly an important addition" to the taxpayer's case, as it "clearly documented that double taxation was occurring."
Daniels, who described the experience as a "once-in-a-career opportunity," said he was optimistic that the brief would get a lot of attention because everyone else, including the Wynnes, was focused on the concept of double taxation. However, both of the attorneys and Viard were pleased and gratified when their argument was raised by Alito and other justices and later became one of the pillars supporting the majority opinion.
As for how Wynne -- and specifically this argument -- will affect future state and local tax jurisprudence, Viard said that given the weaknesses of the double taxation, which were raised by Justice Ruth Bader Ginsburg at arguments, he thinks the "Court, by focusing on internal consistency, really made the right call." Daniels said he agrees, adding that internal consistency is likely to see a rebirth as a result of Wynne. He said he also expects taxpayers to present a more sophisticated economic analysis when appropriate.
University of Connecticut law professor Richard Pomp is more skeptical of the use of economic analysis in future disputes, however. Although Pomp said the brief "may have given comfort to some justices that were on the fence," he said he believes that the internal consistency doctrine calls for statutory analysis and not economic analysis.
"Any lawyer citing it in the future will have to understand those aspects [the economic analysis] of the brief to make good use of it. But I hope no one thinks that economic analysis has become part of the internal consistency doctrine," Pomp said.
Regardless of how it is used by future courts and litigants, the economic analysis as presented in the brief written by Daniels and Meyers clearly won the day in Wynne, one of the most significant state and local tax cases in several years.
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