Accenture Sub, Inc. v. District of Columbia ( 2022 )

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DISTRICT OF COLUMBIA COURT OF APPEALS
No. 18-TX-1321
ACCENTURE SUB, INC., APPELLANT,
V.
DISTRICT OF COLUMBIA, APPELLEE.
Appeal from the Superior Court
of the District of Columbia
(CVT-11-15)
(Hon. Gerald I. Fisher, Trial Judge)
(Argued June 9, 2020 Decided September 29, 2022)
Stephanie A. Lipinski Galland for appellant.
Loren L. AliKhan, Solicitor General at the time of argument, with whom
Karl A. Racine, Attorney General, Carl J. Schifferle, Acting Deputy Solicitor
General, and Mary L. Wilson, Senior Assistant Attorney General at the time of
argument, were on the brief, for appellee.
Before BECKWITH and MCLEESE, Associate Judges, and THOMPSON, ∗ Senior
Judge.
BECKWITH, Associate Judge: Accenture Sub, Inc., a Delaware corporation,
∗
Judge Thompson was an Associate Judge at the time of argument. Her
status changed to Senior Judge on February 18, 2022.
2
challenges a ruling of the Superior Court denying its request for a refund of
corporate franchise taxes on cross-motions for summary judgment. 1 Because we
conclude that Accenture did not timely appeal, we do not reach its various
substantive challenges to the ruling, and we dismiss the appeal.
I.
Believing it had overpaid income and franchise taxes to the District by more
than six million dollars between 2004 and 2009, Accenture requested a refund
from the D.C. Office of Tax and Revenue (OTR). When OTR denied the refund
request, Accenture filed this action in the Superior Court’s Tax Division seeking
review of that denial. After engaging in discovery, the parties filed cross-motions
for summary judgment.
At a January 2018 status hearing, the trial court announced that while it had
“been [its] hope to get a written order out, . . . [it] ha[dn’t] completed that” but was
“ready to rule and announce [its] ruling [on the cross-motions for summary
judgment], and then just supplement it when [it was] able to complete the written
1
Accenture Sub is one of multiple entities within the “worldwide enterprise
generally known as Accenture.” The requested refund involved taxes on income
from Accenture LLP, which was Accenture Inc.’s primary operating company in
the United States. During the time at issue, Accenture LLP was largely owned by
Accenture LLC, which was owned entirely by Accenture Sub. For purposes of this
opinion, “Accenture” refers to Accenture Sub.
3
order.” The court stated that the “short answer” to the question before it—whether
Accenture was entitled to a refund for the 2004–2009 fiscal years—was that
Accenture was obligated to pay the taxes in question, meaning that it was not
entitled to a refund and that the District’s motion for summary judgment would be
granted and Accenture’s denied. The court described its reasons for that ruling—
which were “very dependent” on the organizational structure and history of the
corporate entity, 2 as well as the history of its treatment by the District for tax
purposes—over the course of eight transcript pages. It noted at the outset,
however, that it would “try to be, perhaps, a little bit more comprehensive in the
final written order.” After the court recounted the reasons for its decision, counsel
for the District asked, “Your Honor, just, procedurally, will give a written order
which you consider the final order, correct?” The court responded:
I will probably just issue . . . for now a short written
order that grants the one motion, denies the other, and
then I’ll state that for the reasons stated in open Court,
and then I’m going to try to complete this, what I would
call memorandum in support of my order, to try to get
something in writing, but it’s just been difficult to find
the time and get it completely articulated.
The following day, the court entered an order denying Accenture’s motion
for summary judgment and granting the District’s, stating that it had
2
See supra note 1.
4
concluded, for the reasons stated in open court at the
hearing held January 22, 2018, that Petitioner Accenture
Sub Inc. is subject to the District of Columbia’s corporate
franchise tax on its distributive share of the income it
receives from Accenture LLP, and that there is no
statutory or constitutional barrier to the District of
Columbia collecting that tax . . . .
The court included a footnote at the end of the order providing that “It is this
Court’s intention to more fully elaborate on the reasons for its decision in a written
memorandum to be issued in the near future.”
No such memorandum issued. In November 2018, the parties contacted
chambers to inquire about the status of the memorandum and were informed that
there would not be one. Just over three weeks later, Accenture moved for
“confirmation that no further merits ruling is forthcoming” and entry of judgment
pursuant to Super. Ct. Tax R. 14(a). That rule provides that “[w]hen the Court has
entered its opinion determining the issues in a case, it may withhold entry of its
decision for the purpose of permitting the parties to submit computations pursuant
to the Court’s determination of the issues, showing the correct amount of the
deficiency, overpayment or underpayment.” The rule provides procedures for the
entry of judgment in the event of agreement or nonagreement between the parties
as to the computations. If the parties agree on the “amount of the deficiency,
overpayment or underpayment to be entered as the decision pursuant to the Court’s
findings and conclusions”—which Accenture represented that the parties did here,
5
agreeing on an overpayment amount of “$0”—one or both “shall file promptly
with the Deputy Clerk for the Tax Division a proposed judgment evidencing their
agreement.” Super. Ct. Tax R. 14(a). Accenture argued in the memorandum in
support of its motion that Tax Rule 14(a)’s direction to “file promptly” was met
because the rule provides that a judgment should be proposed “pursuant to the
Court’s findings and conclusions.” And while the trial court “briefly stated its
findings and conclusions from the bench,” it also “indicated . . . its intention to
elaborate further in a memorandum opinion.” This made it reasonable, Accenture
contended, “for the parties to delay proposing a final judgment pending the
issuance of such a memorandum.”
The District opposed the motion for entry of judgment, asserting that Tax
Rule 14 did not apply. It argued that the rule did not require entry of a separate
judgment, both because the rule’s “may withhold” language is permissive and
because there was no computation required given the trial court’s determination
that Accenture was not entitled to a refund.
The trial court held a hearing in February 2019. It noted that it may have
misled the parties by expressing its intention to issue a memorandum in support of
its ruling. It stated that “almost as a matter of equity, [it thought it] ought to give
Accenture an ability to appeal from [the] decision” given that it had not told
6
Accenture that the January 2018 order was the one it needed to appeal. It also
indicated its agreement with Accenture that Tax Rule 14 operates like Civil Rule
58, requiring a separate order of judgment with a “date and a finite amount” of the
overpayment or underpayment, even if that amount is zero. The court accordingly
granted Accenture’s motion and directed the clerk to enter judgment that
Accenture overpaid $0.00.
Accenture first filed a notice of appeal to this court on December 13, 2018,
30 days after learning that there would be no further memorandum. It noted an
appeal from the January 23, 2018, order—the brief order issued and entered on the
docket the day after the trial court ruled on the summary judgment motions from
the bench—but noted that it was doing so “out of an abundance of caution and
without waiver of [its] position that [Super. Ct. Tax R. 14] requires the Court to
enter judgment.” This court issued an order of show cause why the appeal should
not be dismissed as untimely filed. Accenture responded, arguing that the time to
appeal had not started to run because the Superior Court had not entered judgment
as Tax Rule 14 requires and, in the alternative, that an equitable exception to the
filing deadline applied. After the trial court entered its January 2019 judgment,
Accenture amended its notice of appeal to include notice that, in addition to
appealing from the January 23, 2018, order, it was appealing from (1) the order
directing entry of judgment that it overpaid $0.00, entered on the docket on
7
February 8, 2019, and (2) the February 11, 2019, docket entry stating, “Final
Judgment is Petitioner Paid $0.00.” This court subsequently discharged the show-
cause order.
II.
Unless otherwise specified, “[t]he notice of appeal in a civil case must be
filed with the Clerk of the Superior Court within 30 days after entry of the
judgment or order from which the appeal is taken.” D.C. App. R. 4(a). Rule 4(a)
is a mandatory claim-processing rule, which the District has “properly invoked” in
this case. Deloatch v. Sessoms-Deloatch, 229 A.3d 486, 493 (D.C. 2020). Thus,
barring application of any equitable exceptions, we may not consider the merits of
this challenge if Accenture failed to file a notice of appeal within the time set forth
in Rule 4(a). 3 See id. at 493 n.12.
3
This is true notwithstanding that a motions panel of this court discharged
the show-cause order directed to the timeliness of this appeal. Cf. Bank of Am.,
N.A. v. District of Columbia, 80 A.3d 650, 659 (D.C. 2013) (addressing a
jurisdictional question raised in a since-vacated show-cause order because “this
court must be satisfied that it has jurisdiction”); In re J.A.P., 749 A.2d 715, 717
(D.C. 2000) (“[E]ven when a motions division of this court has [entered an order
allowing an interlocutory appeal], . . . the division assigned to decide the merits is
not bound by that order if, after briefing and further consideration, it concludes that
the standards governing appeal under the statute are not satisfied.”).
8
A.
The parties disagree about which Superior Court order here started the clock
for Accenture to file its notice of appeal. Accenture argues that it was the February
2019 ruling because no “judgment” under Tax Rule 14 was entered until that point.
The District argues that Accenture’s appeal had to be taken from the January 2018
order, which it contends was “entered in compliance with the rules of the Superior
Court[’s]” Tax Division, D.C. App. R. 4(a)(6), resolved all of the issues in the
case, and disposed of all of the pending motions. The parties’ dispute largely
comes down to the applicability of Tax Rule 14. We need not determine the
precise scope or construction of that rule except to say that it could not be invoked
here to restart Accenture’s appeal window well after the court issued an order that
resolved all issues in the case and left no doubt as to the computation of any taxes
due.
We agree with the District that Tax Rule 14 does not always mandate entry
of a separate document setting forth a specific dollar-figure judgment. The rule
permits, but does not require, the Tax Division to “withhold entry of its decision”
to allow the parties to “submit computations . . . showing the correct amount of the
9
deficiency, overpayment or underpayment . . . to be entered as the decision.” 4
Super. Ct. Tax R. 14(a). The rule does not speak to the procedure that applies if
the court does not “withhold entry of its decision” and does not state that the court
must enter a dollar-figure judgment in a separate document in those circumstances
as Accenture has suggested. 5 Thus, for a decision of the Tax Division to be
4
Tax Rule 14 closely resembles Rule 155 of the federal court tax rules.
Accordingly, we “look to cases interpreting the federal rule for guidance.”
Patterson v. Sharek, 924 A.2d 1005, 1009–10 (D.C. 2007). Authorities
interpreting the federal rule show both that it is discretionary and that it is
employed in cases in which “the dollar amounts of deficiencies and/or
overpayments . . . cannot readily be determined.” Cloes v. Comm’r of Internal
Revenue, 79 T.C. 933, 935 (1982); see also Jose Leiman, Navigating the
Treacherous Waters of Tax Court Rule 155, 49 Tax Law. 165, 166 (1995) (noting
that there are generally “two situations in which the court may enter its decision
directly, rather than under Rule 155[:] . . . when the court finds entirely in favor of
the [Internal Revenue] Service (sustaining the amount asserted in the notice of
deficiency) or entirely in favor of a taxpayer who was not asserting an
overpayment (entering a finding of no deficiency),” and that “[w]hen the court
chooses to withhold the entry of its decision, the opinion filed” will include a
notation that the decision “will be entered under Rule 155” (emphasis added)).
5
Accenture argued in its response to the show-cause order that Tax Rule 14
fills the role of Civil Rule 58 in the tax context by requiring judgment to be set out
on a separate document and thus clarifying the appeal deadline. Even if the written
order here would not satisfy Rule 58, but see, e.g., Kidd v. District of Columbia,
206 F.3d 35 (D.C. Cir. 2000), Rule 58 is not applicable to actions brought in the
Tax Division. See Super. Ct. Tax R. 3(a). Other state courts have found that the
omission of separate-document requirements in rules governing tax proceedings is
not accidental, as such proceedings involve review of agency decisions and often
have a “clearly ascertainable” final decision, unlike some complex civil matters.
Lewis v. Kawafuchi, 116 P.3d 711, 715–16 (Haw. Ct. App. 2005); accord Alford v.
City & Cnty. of Honolulu, 122 P.3d 809, 816–18 (Haw. 2005). We note that no
separate-document requirement applies in proceedings for review of those
10
“entered for purposes of [Rule 4(a)]” so as to start the appeal clock, D.C. App. R.
4(a)(6), it must be entered on the docket, Super. Ct. Civ. R. 79; see also Super. Ct.
Tax R. 3(a) (making Super. Ct. Civ. R. 79 applicable to actions in the Tax
Division), but need not in all cases be a separate judgment under Tax Rule 14.
In this case, there are no indications that the trial court did in fact “withhold
entry of its decision” so that the parties could submit computations. Because the
trial court granted the District’s motion for summary judgment and found that
Accenture had not overpaid, there was no need for computations: the amount of
any refund—$0.00—could readily be determined. See supra note 4. And while
the trial court expressed its intention to (try to) issue a memorandum in support of
its order that would further articulate the reasons for its decision, it did not invoke
Tax Rule 14 in doing so. 6 Indeed, when the trial court ultimately directed entry of
administrative agency orders or decisions that are subject to review in the Superior
Court, either. See Super. Ct. Agency Rev. R. 1(i).
6
The outstanding memorandum providing further reasons for denying the
requested refund would not otherwise have affected the finality of the January
2018 order, either. Cf. In re Na.H., 65 A.3d 111, 114–15 (D.C. 2013) (holding that
time for appeal in neglect proceedings ran from issuance of written disposition
order, where the order “indicated that additional written findings of fact and
conclusions of law would be issued at a later date” but “nothing in that order
suggested that it was contingent upon the issuance of future findings”); United
States v. Bradley, 882 F.3d 390, 394 (2d Cir. 2018) (“The fact that the district court
reserved the right to explain its . . . decision . . . does nothing to prevent the clock
from running.”).
11
the judgment under Tax Rule 14 over a year after its order disposing of the issues
in the case, it did so “almost as a matter of equity” and not because it had been
withholding entry of its decision.
We do not see a basis here—equitable or otherwise—for the delayed
invocation of Tax Rule 14. Accenture contends that the parties understood that the
January 2018 order did not start the appeal timeline because Tax Rule 14 was in
play. It also suggests that the parties thought that Tax Rule 14 computations were
on hold pending issuance of the court’s memorandum. Even if this belief that no
action on the Tax Rule 14 computations could be taken without the memorandum
were reasonable, 7 Accenture waited over six months after the parties’ “settlement
discussions” 8 had stalled before inquiring about the status of the court’s
7
Accenture posits that the memorandum was necessary for the submission
of computations under Tax Rule 14, as such computations are made “pursuant to
the Court’s findings and conclusions.” Super. Ct. Tax R. 14(a). But the trial court
gave a relatively comprehensive ruling from the bench that outlined its findings
and conclusions. Accenture has identified no grounds to think that further reasons
for denying the refund would have affected the calculation of the overpayment
amount, which—the court’s decision made perfectly clear—was zero.
8
Accenture cites declarations it submitted to the trial court showing that
“settlement discussions” (but not, notably, attempts to compute the amount of
deficiency under the court’s findings) continued for some months after the court’s
January 2018 order. We assume for present purposes that this information was
properly before the trial court.
12
memorandum. Accenture’s actions cannot be described as diligent. 9 Permitting an
appeal to run from the February 2019 judgment—which was issued over a year
after all the issues in the case had been resolved—would hamper “the orderly
administration of justice and the ‘deep-seated interest in promoting the finality of
judgments.’” Deloatch, 229 A.3d at 492 (quoting Siddiq v. Ostheimer, 718 A.2d
145, 147 (D.C. 1998)); see also Super. Ct. Tax R. 14 (emphasizing
“prompt[ness]”); Mathis v. D.C. Hous. Auth., 124 A.3d 1089, 1104–05 (D.C. 2015)
(invoking the equitable maxim that “equity aids the vigilant” (quoting Simpson v.
D.C. Off. of Hum. Rts., 597 A.2d 392, 403 (D.C. 1991))).
We do not suggest here that a trial court could never belatedly invoke Tax
Rule 14 (in a case, for example, in which it turned out computations would be
useful) or that it could never “withhold entry of its decision” for computations in a
9
Particularly given the ambiguous and aspirational nature of the trial court’s
mentions of a forthcoming memorandum, waiting on the memorandum for this
long was not reasonable for a counseled party. By analogy, a would-be appellant
in a civil case waiting on a separate document setting forth the judgment under
Super. Ct. Civ. R. 58 cannot wait forever to file a notice of appeal but must act
after 150 days if the separate document has not been entered. Super. Ct. Civ. R.
58(c)(2)(B); see also Cambridge Holdings Grp., Inc. v. Fed. Ins. Co., 489 F.3d
1356, 1363 (D.C. Cir. 2007) (explaining the operation of the virtually identical
Fed. R. Civ. P. 58(c)(2)(B), which “ensure[s] that parties will not be given forever
to appeal” (quoting Fed. R. App. P. 4(a)(7) advisory committee’s notes to 2002
amendments)). Similarly, even where a litigant did not receive notice of the entry
of an appealable judgment or order, a motion to reopen the time to appeal must be
filed within 180 days of the entry of that judgment or order. D.C. App. R. 4(a)(7).
13
case in which the computations were straightforward or even zero. But on the facts
of this case, the trial court could not enter a judgment purportedly under Tax Rule
14 after a significant period of time and, in doing so, give Accenture a new
opportunity to appeal. See Fed. Trade Comm’n v. Minneapolis-Honeywell
Regulator Co., 344 U.S. 206, 211 (1952) (“[T]he mere fact that a judgment
previously entered has been reentered or revised in an immaterial way does not toll
the time within which review must be sought.”); cf. Circle Liquors, Inc. v. Cohen,
670 A.2d 381, 386 (D.C. 1996) (holding that the trial court did not have authority
to extend the time period to file post-trial motions and that the trial court’s
sanctioning of the late filings did not affect the time to appeal); cf. also D.C. App.
R. 26(b) (providing that “the court may not extend the time . . . to file a notice of
appeal (except as authorized in Rule 4)”).
B.
Having concluded that the final judgment at issue was that of January 23,
2018, we may entertain this appeal only if an equitable exception applies. The
District contends both that Accenture waived any argument for equitable tolling
and that Supreme Court precedent forecloses the possibility that Rule 4(a)’s
mandatory claim-processing rule is subject to equitable exceptions. See
Nutraceutical Corp. v. Lambert, 139 S. Ct. 710, 714–15 (2019) (holding that Fed.
14
R. Civ. P. 23(f), a mandatory claim-processing rule, is not subject to equitable
tolling because “the text of the rule [does not] leave[] room for such flexibility”). 10
We need not resolve either question because the circumstances here would not
warrant equitable tolling in any event. See Ware v. D.C. Dep’t of Emp. Servs., 157
A.3d 1275, 1280 n.4 (D.C. 2017) (noting that equitable tolling requires
“extraordinary circumstances”).
Accenture’s only argument for equitable relief rests on the “unique
circumstances” doctrine—it contends that the trial court’s representation that it
would try to issue a written memorandum “affirmatively misled [it] into delaying
the filing of [its] notice of appeal” but that it “timely filed” the notice of appeal
after learning that no memorandum would issue. Frain v. District of Columbia,
572 A.2d 447, 451 (D.C. 1990) (quoting Robinson v. Evans, 554 A.2d 332, 335
(D.C. 1989)). This court has rejected application of the “unique circumstances”
doctrine to claim-processing rules, see Mathis, 124 A.3d at 1103 n.26, but even by
its own terms it would apply only where the appellant’s reliance on the trial court’s
action or statement was reasonable, Frain, 572 A.2d at 451. Although Accenture
10
This court has not addressed the question with respect to D.C. App. R.
4(a). See Deloatch, 229 A.3d at 493 n.12 (noting that the Supreme Court’s
decision in Hamer v. Neighborhood Hous. Servs. of Chi., 138 S. Ct. 13 (2017), had
“expressly reserved the question . . . ‘whether mandatory claim-processing rules
may be subject to equitable exceptions’” but not discussing the import of
Nutraceutical (quoting Hamer, 138 S. Ct. at 18 n.3)).
15
may reasonably have believed that a memorandum was forthcoming, it was not
reasonable on these facts for it to believe that such a memorandum would affect its
filing deadline. See supra notes 6–7, 9; In re Na.H., 65 A.3d 111, 114–15 (D.C.
2013) (order disposing of all issues, and not subsequent written findings and
conclusions, started appeal timeline); United States v. Fraser, 330 A.2d 761, 762–
63 (D.C. 1975). Moreover, as explained above, Accenture did not act diligently,
which forecloses the possibility of equitable tolling. See Mathis, 124 A.3d at
1104–06; see also Norman v. United States, 467 F.3d 773, 776 (D.C. Cir. 2006).
III.
For the foregoing reasons, Accenture’s appeal is dismissed as untimely filed.
So ordered.