Petition for Writ of Certiorari — Monte Silver, Ltd., Petitioner v. Internal Revenue Service, et al.

APPENDIX TABLE OF CONTENTS

OPINIONS AND ORDERS

Judgment of the United States Court of Appeals

for the District of Columbia Circuit

(December 6, 2022) ............................................... 1a

Order of the United States District Court for the

District of Columbia (November 1, 2021) .......... 7a

Memorandum Opinion of the United States

District Court for the District of Columbia

(March 28, 2021) ................................................. 22a

Memorandum Opinion and Order of the United

States District Court for the District of

Columbia (December 24, 2019) ......................... 60a

STATUTORY PROVISIONS

Pertinent Statutory Provisions of the RFA ............ 68a

5 U.S.C. § 603........................................................ 68a

5 U.S.C. § 604........................................................ 70a

5 U.S.C. § 605........................................................ 71a

5 U.S.C. § 611........................................................ 72a

APPENDIX TABLE OF CONTENTS (Cont.)

OTHER DOCUMENTS

Monte Silver Memo Analyzing Treasury Regulatory

Authority (October 22, 2018) .................................... 73a

Email Correspondence Between Monte Silver

and Treasury (June 4, 2018) ............................. 78a

Certification in Proposed Guidance ........................ 80a

Certification in Final Guidance ............................... 83a

GAO Report: Treasury and OMB Need to

Reevaluate Long-Standing Exemptions of

Tax Guidance ...................................................... 90a

Report of Democrats Abroad: Tax Filing from

Abroad Research on Non-Resident Americans

and U.S. Taxation March 2019 ......................... 94a

Letter from Democrats Abroad to Senator

Hatch Et Al. (April 20, 2018) ............................ 97a

Memorandum of Law of the RO Amici Curiae

in Support of the Plaintiffs’ Motion for

Summary Judgment (June 9, 2020) ............... 109a

Memorandum of Law of Amici Curiae The

Center for Tax Payer Rights in Support

of the Plaintiffs (May 18, 2020)....................... 128a

App.1a

JUDGMENT OF THE

UNITED STATES COURT OF APPEALS FOR

THE DISTRICT OF COLUMBIA CIRCUIT

(DECEMBER 6, 2022)

UNITED STATES COURT OF APPEALS FOR

THE DISTRICT OF COLUMBIA CIRCUIT

________________________

MONTE SILVER AND MONTE SILVER, LTD.,

AN ISRAELI CORPORATION,

Appellants,

v.

INTERNAL REVENUE SERVICE, ET AL.,

Appellees.

________________________

No. 21-5116

Appeal from the United States District Court

for the District of Columbia

(No. l: l 9-cv-0024 7)

Before: PILLARD and KATSAS, Circuit Judges,

and ROGERS, Senior Circuit Judge.

JUDGMENT

This appeal was considered on the record from the

district court and on the briefs and arguments of the

parties. The Court has afforded the issues full consideration and has determined that they do not warrant

App.2a

a published opinion. See Fed. R. App. P. 36; D.C. Cir.

R. 36(d). For the reasons stated below, it is:

ORDERED that the district court’s merits judgment be AFFIRMED and that the appeal of its ruling

on the motion to seal be DISMISSED.

This case involves taxes imposed on United States

shareholders who control foreign corporations. 26

U.S.C. §§ 951-965. Before 2017, such shareholders

generally incurred tax liability only upon receipt of a

corporate dividend. But the Tax Cuts and Jobs Act of

2017 modified this scheme going forward, and it

imposed a one-time “transition” tax on shareholders

based on the tax-deferred earnings of controlled foreign

corporations between 1987 and 2017. Id. § 965.

The Regulatory Flexibility Act (RFA) requires

agencies to analyze the impact of their regulations on

small businesses. 5 U.S.C. §§ 603, 604. The RFA does

not apply if the agency certifies that the regulation

at issue will not have a significant impact on a substantial number of small entities. Id. § 605(b). The

Internal Revenue Service made such a certification in

promulgating regulations to implement the transition

tax. Regulations Regarding the Transition Tax Under

Section 965 and Related Provisions, 84 Fed. Reg.

1,838, 1,873 (Feb. 5, 2019).

Monte Silver, a U.S. citizen, owns and controls

Monte Silver, Limited, a foreign corporation. On his

2017 tax return, Silver made the election permitted

by 26 U.S.C. § 962, which allows an individual shareholder to have income from controlled foreign corporations taxed as if the shareholder were a domestic

corporation. As a result of his section 962 election,

Silver incurred no transition tax liability.

App.3a

In this lawsuit, Silver and Limited contend that

the transition tax regulations have a significant impact

on a substantial number of small entities, and thus

were promulgated in violation of the RFA. On summary judgment, the district court held that the plaintiffs lacked Article III standing to challenge the regulations. The court further held that the IRS, in

defending this lawsuit, did not unlawfully file Silver’s

2017 tax return on the public record in this case.

We agree with the district court that neither

plaintiff has Article III standing to challenge the

regulations. To establish standing, a plaintiff must

show that it has suffered an injury fairly traceable to

the defendant’s challenged action and likely to be

redressed by a favorable court ruling. Lujan v. Defs.

of Wildlife, 504 U.S. 555, 560-61 (1992). The plaintiff

must prove standing “with the manner and degree of

evidence required at the successive stages of the

litigation.” Id. at 561. Thus, in resisting summary

judgment, the plaintiff may not rest on “mere allegations,” but “must set forth by affidavit or other evidence

specific facts” supporting standing. Id. (cleaned up).

The plaintiffs claim standing based on their past

and future compliance costs. In the past, Silver spent

time and money to determine his potential transition

tax liability and to make his section 962 election. But

the plaintiffs here seek only prospective relief declaring

the RFA certification unlawful, staying enforcement

of the regulations, and remanding for the IRS to comply

with the RFA. They do not seek compensation for

past compliance costs, which are thus not redressable

in this case. Nor do any past injuries suffice to show

a likelihood of future injuries redressable by prospective relief. See, e.g., Am. Soc’y for Prevention of

App.4a

Cruelty to Animals v. Ringling Bros. and Barnum &

Bailey Circus, 317 F.3d 334, 336 (D.C. Cir. 2003); Los

Angeles v. Lyons, 461 U.S. 95, 102 (1983).

Silver alleges that his section 962 election will

subject him to future compliance costs whenever

Limited pays a dividend. But the plaintiffs have not

explained how those costs are traceable to the transition

tax regulations—as opposed to the transition tax

statute, other provisions of the Internal Revenue

Code, other tax regulations besides the ones challenged

here, or other sources of law such as tax treaties. The

plaintiffs do not allege that anything in the transition

tax regulations (as opposed to the statute) required

or even incentivized Silver to make the section 962

election in the first place. Nor do the plaintiffs

explain how the regulations cause any compliance

costs flowing from the election. To the contrary, the

plaintiffs’ most specific allegation on this point is

that Silver “must comply with a wide variety of the

most complex tax laws in the IRC, such as foreign

tax credit accounting, allocation between dividends

tainted and not tainted by the 962 election, a bilateral

tax treaty, qualified/non-qualified dividends, etc.” Plaintiffs’ Memorandum in Opposition to Defendants’ Cross

Motion for Summary Judgment, Silver v. IRS, No.

19-cv-247 (D.D.C.), ECF Doc. 61 at 5. On its face, this

account ties Silver’s future compliance costs to various

statutory provisions and a treaty, not to the regulations that he seeks to challenge.

Because the plaintiffs’ past compliance costs are

not redressable and their future compliance costs are

not traceable to the transition tax regulations, we

affirm the district court’s conclusion that the plaintiffs

lack Article III standing to challenge the regulations.

App.5a

Given this disposition, we need not reach the questions

whether the Anti-Injunction Act bars this lawsuit or

whether the RFA affords a cause of action to the

plaintiffs.

While litigating the merits, the IRS filed Silver’s

tax return on the public record. The plaintiffs argued

that this violated 26 U.S.C. § 6103, which generally

requires the IRS to keep tax return information confidential. The district court held that this case fell

within a statutory exception permitting disclosure in

any “proceeding pertaining to tax administration.”

J.A. 16263; see 26 U.S.C. § 6103(h)(4). But the court

provisionally sealed the tax return pending further

consideration of whether sealing was nonetheless

appropriate under United States v. Hubbard, 650

F.2d 293 (D.C. Cir. 1980). J.A. 164-65. The plaintiffs

seek to appeal the ruling that section 6103 does not

apply. We lack jurisdiction to review it because the

sealing question is collateral to the merits, see In re

Sealed Case, 237 F.3d 657,664-65 (D.C. Cir. 2001),

yet the section 6103 question decided by the district

court is not collateral to the Hubbard question that

the order on appeal left open. In short, because the

sealing order made no final decision on whether parts

of Silver’s tax return should remain confidential, we

lack appellate jurisdiction under 28 U.S.C. § 1291.

At oral argument, the plaintiffs sought to cure this

jurisdictional problem by promising to abandon their

argument for sealing under Hubbard. They then filed

a notice with the district court stating: “Plaintiffs hereby notify the Court that subject to the Appeals court

indeed ruling on the wrongful disclosure matter,

plaintiffs waive any Hubbard or other rights they

have to maintain their tax returns sealed.” Notice of

App.6a

Plaintiffs’ Waiver of Right to Seal Confidential Records

Under United States v. Hubbard, Silver v. IRS, No.

19-cv-247 (D.D.C.), ECF Doc. 84 at 3. This filing does

not give us jurisdiction to review the sealing order

from which the plaintiffs have appealed. Our jurisdiction extends only to that order, see Fed. R. App. P.

3(c)(1)(B), and it made no final sealing decision. The

plaintiffs could not retroactively convert the interlocutory order before us into a final decision through

post-appeal filings definitively abandoning arguments

otherwise pending in the district court. Still less may

they do so through post-appeal filings promising to

abandon otherwise live arguments on the condition

that we treat the interlocutory order before us as if it

were final.

Pursuant to D.C. Circuit Rule 36, this disposition

will not be published. The Clerk is directed to withhold

issuance of the mandate until seven days after

resolution of any timely petition for rehearing or

petition for rehearing en banc. See Fed. R. App. P. 41(b);

D.C. Cir. R. 41(a)(1).

Per Curiam

FOR THE COURT:

Mark J. Langer

Clerk

BY: /s/ Daniel J. Reidy

Deputy Clerk

App.7a

ORDER OF THE UNITED STATES DISTRICT

COURT FOR THE DISTRICT OF COLUMBIA

(NOVEMBER 1, 2021)

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

________________________

MONTE SILVER, ET AL.,

Plaintiffs,

v.

INTERNAL REVENUE SERVICE, ET AL.,

Defendants.

________________________

Civil No. 19-cv-247 (APM)

Before: Amit P. MEHTA,

United States District Court Judge.

ORDER

I.

In this action, Plaintiffs Monte Silver (“Silver”)

and Silver, Ltd. (“Silver Limited”) challenged the

Internal Revenue Service’s (“IRS”) alleged failure to

conduct a small business impact analysis under the

Regulatory Flexibility Act (“RFA”) when it promulgated

a set of rules known as the “Transition Tax Regulations.” See Silver v. IRS, No. 19-cv-247 (APM), 2021

WL 1180081, at *1 (D.D.C. Mar. 28, 2021). Plaintiffs

“asked the court to declare [the IRS’s RFA certifica-

App.8a

tions] invalid and to remand the proposed and final

regulations to Defendants for compliance with the

RFA.” Id. at *5. They also demanded an order staying

enforcement of the Regulations against small businesses until the IRS conducted an acceptable RFA

analysis. See id. at *8. The court, however, entered

judgment in favor of Defendants on two grounds: (1)

Plaintiffs failed to establish Article III standing as

they had not demonstrated an ongoing injury or an

imminent threat of one, see id. at *11-12, and (2)

Plaintiffs lacked “statutory standing” to bring a claim

under the RFA because neither Plaintiff qualified as

a “small entity that is adversely affected or aggrieved

by final agency action,” 5 U.S.C. § 611(a)(1); see Silver,

2021 WL 1180081, at *12-15. Plaintiffs now seek

reconsideration of the court’s decision. Pls.’ Mem. of

P. & A. in Supp. of Their Mot. for Recons. and for Leave

to Amend the Compl., ECF No. 70 [hereinafter Pls.’

Mem.]. They also ask for leave to amend their complaint. See id.

For the reasons explained below, Plaintiffs’ motion

for post-judgment relief is denied.

II.

The court begins with Plaintiffs’ motion for

reconsideration. Although Plaintiffs move for reconsideration under both Federal Rules of Civil Procedure

59(e) and 60(b), see Pls.’ Mem. at 1, because Plaintiffs

filed their motion within 28 days of entry of judgment, the court considers the motion under Rule 59(e),

see Slate v. Am. Broadcasting Cos., Inc., 12 F. Supp.

3d 30, 37 (D.D.C. 2013). And, because the Rule 60(b)

standard is “somewhat more restrictive” than that

governing Rule 59(e), the court need only consider

App.9a

Plaintiffs’ arguments under the latter standard. See

Slate, 12 F. Supp. 3d at 37 (quoting 11 CHARLES

ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL

PRACTICE AND PROCEDURE § 2817 n.15 (3d ed.

1980)).

“A Rule 59(e) motion is discretionary and need

not be granted unless the district court finds that

there is an intervening change of controlling law, the

availability of new evidence, or the need to correct a

clear error or prevent manifest injustice.” Firestone

v. Firestone, 76 F.3d 1205, 1208 (D.C. Cir. 1996)

(internal quotation marks omitted). Importantly, a

Rule 59(e) motion “may not be used to relitigate old

matters, or to raise arguments or present evidence

that could have been raised prior to the entry of

judgment.” Leidos, Inc. v. Hellenic Republic, 881 F.3d

213, 217 (D.C. Cir. 2018) (quoting Exxon Shipping v.

Baker, 554 U.S. 471, 486 n.5 (2008)). It is also “not a

vehicle to present a new legal theory that was available

prior to judgment.” Patton Boggs LLP v. Chevron Corp.,

683 F.3d 397, 403 (D.C. Cir. 2012).

As will be seen, Plaintiffs’ arguments and presentation of new evidence fail to satisfy the rigorous Rule

59(e) standard.

A.

Plaintiffs first criticize the court’s threshold determination, as part of its standing inquiry, that

Plaintiffs sought both retrospective and prospective

relief under the RFA. Pls.’ Mem. at 5. According to

Plaintiffs, they “never made any requests for retrospective or prospective/injunctive relief. Plaintiffs

simply are asking for the relief provided under the

RFA, Section 611.” Id. Plaintiffs’ argument is difficult

App.10a

to understand. Plaintiffs cite no case for the proposition that relief under RFA is sui generis and defies

traditional categorization as either retrospective

or prospective. Admittedly, the words “retrospective”

or “prospective” do not appear in the RFA. See id. at

7 (asserting that “[n]othing in the language of the

statute suggests that Congress wished to treat Section

611 as equivalent to ‘prospective’ relief equivalent to

an injunction”). But that does not mean the court is

not required to determine the type of relief requested

to evaluate standing. To the contrary, as this court

observed, “the Supreme Court has made clear that

the `injury in fact’ requirement of standing varies

depending on whether the plaintiff seeks prospective

or retrospective relief” Silver, 2021 WL 1180081, at

*8 (citing City of Los Angeles v. Lyons, 461 U.S. 95,

101-02, 105 (1983)). Plaintiffs do not seriously suggest,

nor could they, that the remedial provisions of the

RFA are not subject to this basic principle of Article

III standing.

Plaintiffs wrongly criticize the court for having

demanded that they show ongoing or imminent future

injury to establish standing. Plaintiffs sought relief

under Section 611 of the RFA, which permits a court

to “defer[] the enforcement of the rule against small

entities unless the court finds that continued enforcement of the rule is in the public interest,” 5 U.S.C.

§ 611(a)(4)(B). See First Am. Compl., ECF No. 5, at

19 (seeking to “stay the enforcement of the Final

Regulations and Sections 965 and 962 against Plaintiffs and other small businesses until such time as

Defendants comply with their statutory duties”). Such

relief is properly categorized as “prospective.” See

Landgraf v. USI Film Prods., 511 U.S. 244, 293 (1994)

App.11a

(Scalia, J., concurring in the judgment) (mem.)

(observing that “the purpose of prospective relief is to

affect the future rather than remedy the past”); cf.

Verizon Md., Inc. v. Pub. Serv. Comm’n, 535 U.S.

635, 645 (2002) (finding that a request to restrain

state officials from enforcing an order violating federal law met the “straightforward inquiry” into whether

relief sought is “properly characterized as prospective”).

It is also fairly considered “injunctive.” See Injunction,

BLACK’S LAW DICTIONARY (11th ed. 2019) (“A

court order commanding or preventing an action.”);

Injunctive, BLACK’S LAW DICTIONARY (11th ed.

2019) (“That has the quality of directing or ordering;

of, relating to, or involving an injunction.”). The court

therefore was required to determine whether Plaintiffs had established ongoing or imminent future

injury as part of its standing inquiry. See Arpaio v.

Obama, 797 F.3d 11, 19 (D.C. Cir. 2015) (stating where

a plaintiff “seeks prospective declaratory and injunctive

relief, he must establish an ongoing or future injury

that is ‘certainly impending’; he may not rest on past

injury” (quoting Clapper v. Amnesty Int’l USA, 568

U.S. 398, 401 (2013))).

To be fair, with the benefit of hindsight, the

court’s treatment of the relief sought by Plaintiffs as

both prospective and retrospective arguably caused

unnecessary confusion. See Silver, 2021 WL 1180081,

at *8-10. The court’s characterization of Plaintiffs’

request for declaratory relief as “retrospective” probably

was incorrect. See id Plaintiffs asked the court to

declare “that Treasury’s RFA Section 605(b) certifications are invalid” and remand to the agency to conduct

an RFA analysis. Id. at *8. Such a declaration, if

granted, would have deemed invalid the future effect-

App.12a

iveness of the agency’s RFA certification, thus making

such relief prospective. See Verizon, 535 U.S. at 646

(describing declaratory relief seeking the invalidation

of a state order as violative of federal law as relief

having “future” effect and “add[ing] nothing to the

prayer for injunction”). Thus, even Plaintiffs’ demand

for declaratory relief required them to show an

ongoing or future injury to have standing. See Arpaio,

797 F.3d at 19.

B.

In any event, the court ultimately conducted an

inquiry into Plaintiffs’ claimed future injury and

found that they had failed to carry their burden at

the summary judgment stage. See Silver, 2021 WL

1180081, at *10-12. Plaintiffs say that determination

was wrong. See Pls.’ Mem. at 9-14. The arguments they

now make, however, do not satisfy the Rule 59(e)

standard.

Plaintiffs insist that they successfully showed

that they would incur future compliance costs, but in

so doing Plaintiffs simply repackage the arguments

made on summary judgment that the court found to

be unsuccessful. See id. at 10 (arguing that “the

interplay between Sections 965 and 962 leads to the

conclusion that Plaintiffs will incur future injuries as

a result of the Transition Tax Final Regulations”).

That is not proper on a Rule 59(e) motion.

Nor does Plaintiffs’ attempt to shore up the record

warrant reconsideration. See id. at 10-11. Silver’s new

declaration attempts to challenge the court’s, ruling

on standing that “Plaintiffs . . . [had said] nothing about

when Silver Limited might issue a dividend to Silver

that would trigger the claimed compliance obligations.”

App.13a

Silver, 2021 WL 1180081, at *12; see Pls.’ Mem. at

10-11. Silver now declares: “In 2021 due to certain

education and housing commitments related to my

children, I am forced to draw a dividend from Silver

Limited.” Pls.’ Mem., Decl. of Monte Silver, ECF No.

71-3 [hereinafter Silver Suppl. Decl.], ¶ 3. This

dividend, Silver claims, will result in future compliance costs under the Transition Tax Regulations. See

id. ¶¶ 6-11.

But Plaintiffs’ new evidence does not warrant

reconsideration for two reasons. First, Silver’s emerging

financial circumstances did not exist at the time of

the dispositive proceedings and therefore is not the

type of “new evidence” that justifies reconsideration.

See 11 CHARLES ALAN WRIGHT & ARTHUR R.

MILLER, FEDERAL PRACTICE AND PROCEDURE

§ 2808 (3d ed. 1980) (“Newly discovered evidence must

be of facts existing at the time of trial.”); cf id.

(observing that the “same standard” applies for

granting a new trial based on newly discovered evidence, “whether the motion is under Rule 59 or 60(b)

(2)”); see also Nat’l Anti-Hunger Coal. v. Exec. Comm.

of President’s Priv. Sector Surv. on Cost Control, 711

F.2d 1071, 1075 n.3 (D.C. Cir. 1983) (stating that,

under Rule 60(b)(2), evidence falls within the rule “as

long as it pertains to facts in existence at the time of

the trial, and not to facts that have occurred subsequently” (alteration and internal quotation marks

omitted)); Duckworth v. United States ex rel. Locke,

808 F. Supp. 2d 210, 216 (D.D.C. 2011) (stating that,

under Rule 60(b)(2), “the newly discovered evidence

is of facts that existed at the time of trial or other

dispositive proceeding”). Second, the new evidence

only underscores Plaintiffs’ failure at summary judg-

App.14a

ment to establish that their claimed injury was

“certainly impending.” Clapper, 568 U.S. at 416.

Silver now declares that he “did not state the 2021

dividend earlier” because “(i) I did not know what

future injury was relevant, (ii) the family-related

financial commitments did not exist, and (iii) I do not

believe I have an obligation to report my personal

issues to the court for the world to read.” Silver

Suppl. Decl. ¶ 12. Whatever the reasons for Silver’s

nondisclosure, he now admits that he did not bring

forward concrete facts to “show an imminent future

injury.” Swanson Grp. Mfg. LLC v. Jewell, 790 F.3d

235, 240 (D.C. Cir. 2015). Rule 59(e) is not a vehicle

to cure evidentiary shortcomings resulting in an

adverse ruling. See Ciralsky v. CIA, 355 F.3d 661,

665 (D.C. Cir. 2004) (stating that “manifest injustice”

for purposes of Rule 59(e) “does not exist where . . . a

party could have easily avoided the outcome, but

instead elected not to act until after a final order had

been entered”).

Nor can Plaintiffs re-litigate the court’s finding

that they failed to show that the challenged Regulations

“would be the cause of [their claimed future compliance]

costs.” Silver, 2021 WL 1180081, at *12. Plaintiffs

now try to make clear what they did not on summary

judgment. Recall, Plaintiffs had argued that, because

Silver had elected to offset the transition tax with

foreign tax credits, as permitted by the Transition

Tax Regulations, any future dividend that he received

from Silver Limited would require him to “comply

with a wide variety of the most complex tax laws in

the [Internal Revenue Code], such as foreign tax

credit accounting, allocation between dividends tainted

and not tainted by the 962 election, a bilateral tax

App.15a

treaty, qualified/ non-qualified dividends, etc.” Pls.’

Mem. in Opp’n to Defs.’ Cross-Mot. for Summ. J. and

in Reply to Defs.’ Opp’n to PIs.’ Mot. for Summ. J.,

ECF No. 61, at 5. The court concluded that such a

general statement shed no light on “ how the

[Transition Tax] regulations will impose future

recordkeeping or reporting burdens. This omission

likewise negates any showing as to redressability.”

Silver, 2021 WL 1180081, at *12. In their current

papers, including Silver’s new declaration, Plaintiffs

still have not identified any provision within the

challenged Regulations that will trigger compliance

costs when Silver receives a dividend. See Pls.’ Mem.

at 11-14. Instead, they refer back to the government’s

acknowledgment on summary judgment that Silver’s

962 election will require him to “track the [future]

earnings subject to the transition tax and the section

962 election separately.” Id. at 13 (quoting Defs.’

Reply in Supp. of Defs.’ Cross-Mot. for Summ. J.,

ECF No. 65 [hereinafter Defs.’ Reply], at 4 n.2). But

Plaintiffs pull that quotation out of context, conveniently leaving out the key part of Defendants’ argument: “However, these distribution ‘layering’ rules and

any tracking requirements that stem from them are

imposed by 26 U.S.C. § 959 and the regulations and

guidance thereunder as well as the section 962 regulations, not the transition tax regulations.” Defs.’

Reply at 4 n.2. Plaintiffs did not meaningfully rebut

this contention then, and they do not do so now. In

the end, it seems that Plaintiffs would have the court

take on faith that they will incur future compliance

costs that is “fairly traceable” to the Transition Tax

Regulations. Clapper, 568 U.S. at 402. That, of course,

is not enough at summary judgment, let alone on a

Rule 59(e) motion.

App.16a

C.

Plaintiffs offer a fallback option if the court

declines, as it has, to reconsider its ruling on the

absence of evidence supporting future injury: amendment of their pleading to assert a demand for nominal

damages. Relying on the Supreme Court’s recent decision in Uzuegbunam v. Preczewksi, 141 S. Ct. 792

(2021), Plaintiffs contend that “[b]ecause nominal

damages is an appropriate remedy for a violation of a

legal right such as that created by the RFA, such

damages can serve as Art. III standing purposes.”

Pls.’ Mem. at 16.

But this argument goes nowhere. The RFA

expressly states that “[i]n granting any relief in an

action under this section, the court shall order the

agency to take corrective action consistent with this

chapter and chapter 7.” 5 U.S.C. § 611(a)(4). “[T]his

chapter” that is, Chapter 6 of Title V, Part I, which

contains the RFA includes no provision for money

damages. Chapter 7 of that Title contains the judicial

review and remedial provisions of the Administrative

Procedure Act, which likewise does not provide for

money damages. 5 U.S.C. §§ 702, 706. The RFA

therefore does not permit an award of damages.

Accordingly, allowing Plaintiffs to amend their complaint to assert nominal damages would be futile and

would not establish standing.

D.

Plaintiffs also seek reconsideration of the court’s

ruling that they lacked “statutory standing” to bring

claims under the RFA. See Pls.’ Mem. at 19-25.

Plaintiffs contend that the court misapplied the “zone

of interests” test in reaching this conclusion. See id.

App.17a

at 19. Upon further reflection, the court agrees that

it misapplied the “zone of interests” test to Silver

Limited but not to Silver himself. The court therefore

modifies its March 28, 2021 Memorandum Opinion

in part.

“Whether a plaintiff comes within the ‘zone of

interests’ is an issue that requires [courts] to determine,

using traditional tools of statutory interpretation,

whether a legislatively conferred cause of action

encompasses a particular plaintiff’s claim.” Lexmark

Int’l, Inc. v. Static Control Components, Inc., 572

U.S. 118, 127 (2014). Congress clearly defined who

could bring suit under the RFA: “For any rule subject

to this chapter, a small entity that is adversely

affected or aggrieved by final agency action is entitled

to judicial review of agency compliance” with statutory

requirements. 5 U.S.C. § 611(a)(1). The RFA in turn

provides that “small entity” “shall have the same

meaning as the terms ‘small business’, ‘small organization’ and ‘small governmental jurisdiction’ defined

in paragraphs (3), (4) and (5) of this section.” 5 U.S.C.

§ 601(6). Plaintiffs conceivably can qualify only as

“small business.” “Small business” in turn “has the

same meaning as the term ‘small business concern’

under section 3 of the Small Business Act.” Id

§ 601(3). Section 3 of the Small Business Act states

that a “small business concern” is “one which is independently owned and operated and which is not

dominant in its field of operation.” 15 U.S.C. § 632

(a)(1). So, for present purposes, a “small entity” that

can bring suit under the RFA is “one which is independently owned and operated and which is not

dominant in its field of operation.”

App.18a

The court now agrees that Silver Limited meets

the definition of a “small entity” for purposes of the

RFA. Silver Limited is plainly a business that “is

independently owned and operated and which is not

dominant in its field of operations,” and Defendants

have never contended otherwise. The mistake the

court made was in conflating the definition of “small

entity” for purposes of bringing a cause of action under

5 U.S.C. § 611(a)(1) with the types of “small entities”

that an agency must consider when undertaking an

RFA analysis. The court erroneously wrote that the

“D.C. Circuit has consistently interpreted [the] language [of 5 U.S.C. § 611(a)(1)] to limit[] its application to the “small entities which will be subject to the

proposed regulation” that is, those “small entities to

which the proposed rule will apply.””’ Silver, 2021

WL 1180081, at *12 (third alteration in original)

(quoting Aeronautical Repair Station Ass’n, Inc. v.

FAA, 494 F.3d 161, 176 (D.C. Cir. 2007)). But that

was wrong. The D.C. Circuit has not “consistently

interpreted” section 611(a)(1), the judicial review

provision, to apply only to “small entities to which

the proposed rule will apply”; rather, it has applied

that standard to limit the substantive reach of the

statute. See Aeronautical Repair Station Ass ‘n, 494

F.3d at 176 (explaining that “the RFA is satisfied if

the agency determines that the rule will not have a

significant economic impact on a substantial number

of small entities that are subject to the requirements

of the rule” (internal quotation marks omitted)). The

court therefore erred when it found that Silver Limited

lacked statutory standing on the ground that the

Regulations did not apply to it, when it is “a small

entity that [was] adversely affected or aggrieved by

App.19a

final agency action.” See id. at *14-15; 5 U.S.C.

§ 611(a)(1). 1

On their cross-motion for summary judgment,

Defendants argued that Silver Limited is not a

“small business” because SBA regulations disqualified

it as such. See Defs.’ Cross-Mot. for Summ. J., ECF

No. 57, Defs.’ Mem. in Supp. of Cross-Mot. for Summ.

J., ECF No. 57-1 [hereinafter Defs.’ Cross-Mot. Mem.],

at 15-18. The court never reached this argument.

Specifically, Defendants pointed out that section 3 of

the Small Business Act states that, “[i]n addition to

the criteria specified in” section 632(a)(1), “the

Administrator may specify detailed definitions or

standards by which a business concern may be determined to be a small business concern for purposes of

this chapter or any other Act.” 15 U.S.C. § 632(a)(2)(A).

The Small Business Administration’s (SBA) regulations in turn provide that

a business concern eligible for assistance

from SBA as a small business is a business

entity organized for profit, with a place of

business located in the United States, and

which operates primarily within the United

States or which makes a significant

contribution to the U.S. economy through

payment of taxes or use of American products,

materials or labor.

1 Defendants never argued, and the court did not hold, that

Silver Limited was not “adversely affected or aggrieved by final

agency action,” as required to qualify as a “small entity” under

5 U.S.C. § 611(a)(1). There was no dispute that Silver Limited

had suffered some past harm arising from the Transition Tax

Regulations.

App.20a

13 C.F.R. § 121.105(a)(1). Defendants argued that because Silver Limited did not have a place of business

in the United States and did not make any showing

as to the economic effects of the business in the United

States, it had failed to establish itself as a “small

business concern” under the Small Business Act and

thus was not a “small entity” under the RFA. Defs.’

Cross-Mot. Mem. at 16-17.

To complete the record, the court now rejects

that argument. The court is unconvinced that the

supplemental definition contained in 13 C.F.R.

§ 121.105 applies to the definition of “small entities”

for purposes of the RFA. The Small Business Act

allows the SBA Administrator to supplement the

Act’s statutory definition with criteria “by which a

business concern may be determined to be a small

business concern for purposes of this chapter or any

other Act.” 15 U.S.C. § 632(a)(2)(A) (emphasis added).

The regulation on which Defendants rely, 13 C.F.R.

§ 121.105, on its face only provides a further definition

of “small business concern” for purposes of “eligib[ility]

for assistance from SBA”—which is not at issue here.

Section 121.105 does not purport to supply additional

definitional terms for “any other Act,” including the

RFA. So, the court cannot conclude that because

Silver Limited does not meet the supplemental defining

terms contained in section 121.105 it does not qualify

as a “small entity” for purposes of filing suit under

the RFA.

Finally, nothing Plaintiffs argue in their motion

convinces the court to change its mind that Silver—a

natural person—does not qualify as a “small entity”

for purposes of the RFA. See Pls.’ Mem. at 22-23.

App.21a

III.

For the foregoing reasons, the court denies

Plaintiffs’ motion to alter or amend its judgment

under Rule 59(e). The court maintains the judgment

that it entered in favor of Defendants because Plaintiffs

failed to carry their burden to establish Article III

standing. The court does, however, modify its Memorandum Opinion insofar as it concluded that Silver

Limited lacks statutory standing. It does have statutory standing, but Silver does not.

Plaintiffs’ “Motion for Expedited Consideration

of Defendants’ Motion to Dismiss,” ECF No. 81, 2 is

denied as moot.

/s/ Amit P. Mehta

United States District Court Judge

Dated: November 1, 2021

2 This motion appears to be misnamed. The court long ago denied

Defendants’ Motion to Dismiss. See Silver v. IRS, No. 19-cv-247

(APM), 2019 WL 7168625, at *1 (D.D.C. Dec. 24, 2019).

App.22a

MEMORANDUM OPINION OF THE

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

(MARCH 28, 2021)

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

________________________

MONTE SILVER, ET AL.,

Plaintiffs,

v.

INTERNAL REVENUE SERVICE, ET AL.,

Defendants.

________________________

Civil No. 19-cv-247 (APM)

Before: Amit P. MEHTA,

United States District Court Judge.

MEMORANDUM OPINION

I.

Introduction

As part of the Tax Cut and Jobs Act of 2017,

Congress amended Internal Revenue Code (“IRC”)

section 965 to impose a one-time “transition tax” on

U.S. shareholders of certain specified foreign corporations based on the earnings accumulated by those

entities since 1986. This case involves a challenge to the

procedures by which Defendants Internal Revenue

App.23a

Service (“IRS”) and the U.S. Department of Treasury

(“Treasury”) promulgated the regulations implementing section 965. Plaintiffs Monte Silver and his

business Monte Silver, Limited, a company based in

Israel, claim to be small entities unduly burdened by

the final regulations. They bring this action to challenge Defendants’ alleged failure to assess the economic

impact the regulation would have on small businesses,

as required by the Regulatory Flexibility Act (“RFA”),

5 U.S.C. §§ 601–612.

Now pending before the court are the parties’

cross-motions for summary judgment. After a thorough

review of the parties’ submissions and applicable

case law and statutory authority, the court finds that

Plaintiffs lack constitutional standing to pursue their

claims. And even if Plaintiffs had standing, neither

Plaintiff has a cause of action under the RFA. Accordingly, for the reasons discussed in greater detail

below, the court grants Defendants’ cross-motion for

summary judgment.

II. Background

A. Statutory and Regulatory Framework

1. The Regulatory Flexibility Act

Enacted in 1980, the RFA is a “[p]urely procedural”

statute that “obliges federal agencies to assess the

impact of their regulations on small businesses.”

U.S. Cellular Corp. v. FCC, 254 F.3d 78, 88 (D.C. Cir.

2001). It “arose from the concern that small businesses

may be forced to bear an unnecessary or disproportionate burden when the federal government issues

regulations.” Nat’l Ass’n for Home Care v. Shalala,

App.24a

135 F. Supp. 2d 161, 163 (D.D.C. 2001). See generally

Doris S. Freedman et al., The Regulatory Flexibility

Act: Orienting Federal Regulation to Small Business,

93 Dick. L. Rev. 439, 440 (1989); Paul R. Verkuil, A

Critical Guide to the Regulatory Flexibility Act, 1982

Duke L.J. 213, 215–26 (1982).

The RFA “‘does not alter the substantive mission

of the agencies under their own statutes.’” N.C.

Fisheries Ass’n, Inc. v. Gutierrez, 518 F. Supp. 2d 62,

72 (D.D.C. 2007) (quoting Little Bay Lobster Co. v.

Evans, 352 F.3d 462, 470 (1st Cir. 2003)); see also 5

U.S.C. § 606 (“The requirements of [5 U.S.C. §§ 603–

604] do not alter in any manner standards otherwise

applicable by law to agency actions.”). Rather, the

Act “is a procedural statute setting out precise, specific steps the agency must take[,]” Aeronautical Repair

Station Ass’n, Inc. v. FAA, 494 F.3d 161, 178 (D.C.

Cir. 2007), to “ensur[e] that agency rules . . . tak[e]

into account the size and nature of the regulated

businesses,” Mid-Tex Elec. Coop., Inc. v. FERC, 773

F.2d 327, 342 (D.C. Cir. 1985) (citing S. Rep. No. 878,

96th Cong., 2d Sess. 3, reprinted in 1980 U.S.C.C.

A.N. 2788, 2790). Specifically, the RFA provides that

whenever an agency is required to publish a notice of

proposed rulemaking, it must first determine whether

the regulation under consideration would “have a

significant economic impact on a substantial number

of small entities.” 5 U.S.C. § 605(b). “Only if the

proposed regulation would have such an impact do

the statute’s two primary procedural obligations

attach.” N.C. Fisheries Ass’n, Inc., 518 F. Supp. 2d at

73. “Those obligations are the preparation first of an

initial and then of a final regulatory flexibility analysis, commonly referred to as an IRFA and a FRFA.”

App.25a

Id. (citing 5 U.S.C. §§ 603–604); see Nat’l Ass’n for

Home Care, 135 F. Supp. 2d at 163. Sections 603 and

604 set forth the explanations and considerations

that IRFAs and FRFAs, respectively, “shall contain.”

5 U.S.C. §§ 603(b), 604(a). Both forms of analysis

generally “describe[] the effect of the proposed rule on

small businesses and discuss[] alternatives that might

minimize adverse economic consequences.” Nat’l

Women, Infants, & Child. Grocers Ass’n v. Food &

Nutrition Serv., 416 F. Supp. 2d 92, 108 (D.D.C. 2006).

The FRFA, specifically, must provide, among other

components, “a description of the steps the agency

has taken to minimize the significant economic impact

on small entities,” including “a statement of the factual,

policy, and legal reasons for selecting the alternative

adopted in the final rule and why each one of the

other significant alternatives to the rule considered

by the agency . . . was rejected.” 5 U.S.C. § 604(a)(6).

But, as is relevant to this case, the agency does not

need to prepare a FRFA if the head of the agency

certifies that the rule “will not . . . have a significant

economic impact on a substantial number of small

entities.” Id. § 605(b).

“The RFA authorizes judicial review of an agency’s

compliance with many but not all of the statutory requirements.” N.C. Fisheries Ass’n, Inc., 518 F. Supp. 2d

at 73 (citing 5 U.S.C. § 611(a)). Courts can, for

instance, determine an agency’s compliance with the

FRFA requirements set forth in section 604, but

cannot adjudicate whether an agency violated the

statute by failing to prepare an IRFA under section

603. See Allied Local & Reg’l Mfrs. Caucus v.

EPA, 215 F.3d 61, 79 (D.C. Cir. 2000). And even

when an agency’s action is subject to judicial review,

App.26a

all that is required of the agency is “a ‘reasonable,

good-faith effort to carry out [the RFA’s] mandate.’”

U.S. Cellular Corp., 254 F.3d at 88 (quoting Alenco

Commc’n, Inc. v. FCC, 201 F.3d 608, 625 (5th Cir.

2000)). Failure to comply with one or more of the

statutory requirements, moreover, does not necessarily

mean that the regulation must be invalidated. To the

contrary, the D.C. Circuit has held that such an

omission “may be, but does not have to be, grounds

for overturning a rule.” Cement Kiln Recycling Coal.

v. EPA, 255 F.3d 855, 868 (D.C. Cir. 2001) (citation

and internal quotation marks omitted); see also 5

U.S.C. § 611(a)(4) (authorizing courts to take “corrective

action consistent with” the RFA, “including, but not

limited to (A) remanding the rule to the agency, and

(B) deferring the enforcement of the rule against

small entities”).

2. Section 965 and the “Transition Tax”

The RFA dispute in this case arises from the

2017 enactment of the Tax Cuts and Jobs Act, Pub.

L. No. 115-97, 131 Stat. 2054 (2017) (“TCJA” or the

“Act”). According to the IRS, the TCJA was “the most

sweeping tax law change in more than 30 years.” 1

Included in that change were international tax rules.

“Section 965, as amended by the Act, is intended to

act as a transition provision between the international

tax rules in place before the Act and those enacted by

1 IRS, Be Tax Ready – Understanding Tax Reform Changes

Affecting Individuals and Families (Feb. 2019) https://www.irs.

gov/newsroom/be-tax-ready-understanding-tax-reform-changesaffecting-individuals-and-families.

App.27a

the Act.” A.R. at 3522. 2 Prior to the TCJA, a U.S. corporation could defer foreign income from taxation by

retaining earnings indefinitely through a foreign

subsidiary. See Pls.’ Mot. for Summ. J., ECF No. 47

[hereinafter Pls.’ Mot.], Mem. of P. & A. in Supp. of

Pls.’ Mot. for Summ. J., ECF No. 47-1 [hereinafter Pls.’

Mem.], at 2. The corporation paid U.S. tax only when

the foreign “earnings were distributed to the domestic

corporation.” A.R. at 3522. The prior rules “encouraged

domestic corporations to minimize distributions back

to the United States and to accumulate substantial

earnings offshore.” Id. Under the rules enacted by

the TCJA, to encourage repatriation of foreign income,

“domestic corporations are in most circumstances

entitled to a 100-percent deduction for any dividends

received from their foreign subsidiaries, which

eliminates any U.S. tax liability on the dividend.” Id.

(citing section 245A). To prevent a windfall, “whereby

a domestic corporation could distribute its historical

pre-Act earnings tax free to the United States, the

Act included section 965 to treat those historical

earnings as repatriated to the United States under

the pre-Act rules, before the new rules took effect.”

Id.

Thus aptly referred to as a “transition tax” or

“repatriation tax,” section 965 imposes a onetime tax

on U.S. shareholders 3 of certain “specified foreign

2 Citations to the Administrative Record (“A.R.”) can be found

in the four-volume Joint Appendix, see ECF Nos. 66–66-4.

3 “For the taxable year to which section 965 applies, a United

States shareholder of a foreign corporation is defined as any

United States person that owns at least 10 percent of the voting

power of such corporation.” A.R. at 3523 n.1 (citing 26 U.S.C.

§ 951(b)).

App.28a

corporations” with “deferred foreign earnings[,] by

deeming those earnings to be repatriated and included

in the U.S. person’s income” for the 2017 tax year.

A.R. at 3522; 26 U.S.C. § 965(a). A specified foreign

corporation is defined as “(A) any controlled foreign

corporation,[4] and (B) any foreign corporation with

respect to which one or more domestic corporations is

a United States shareholder.” 26 U.S.C. § 965(e)(1).

The tax scheme created by section 965 is

complicated, to say the least. The court here touches

only on the relevant portions. The earnings included

in the income of a U.S. shareholder under section

965(a) are generally subject to tax at two rates: “15.5

percent for the portion of earnings that does not

exceed the amount of cash and certain cash equivalent

assets held by the U.S. shareholder’s specified foreign

corporation, and 8 percent for the remaining earnings.”

A.R. at 3524; 26 U.S.C. § 965(c)(1). “These rate

reductions are achieved through a deduction at the

level of the United States shareholder.” A.R. at 3524

(citing 26 U.S.C. § 965(c)(1)). “[T]o calculate the appropriate deduction and determine the portion of the

inclusion that is taxed at the 15.5 percent rate . . . , a

[U.S.] shareholder must determine its ‘aggregate

foreign cash position.’” Id. (quoting 26 U.S.C. § 965

(c)(1)(A)(ii)). “The statute defines ‘aggregate foreign

cash position’ to include items like cash, net accounts

receivable, and the fair market value of actively traded

property, commercial paper, government securities,

short-term obligations, and foreign currency.” Id. (citing

4 “A [controlled foreign corporation] is any foreign corporation

that is more than 50 percent owned, by vote or value . . . , by

United States shareholders (as defined in section 951(b)).” A.R.

at 3523 n.2 (citing 26 U.S.C. § 957(a)).

App.29a

26 U.S.C. § 965(c)(3)(B)). Importantly, for purposes of

this case, U.S. “shareholders may use foreign tax

credits, in accordance with the pre-Act rules, to offset

their inclusions under section 965.” Id.

Recognizing the potential hardship associated with

paying taxes on 30 years’ worth of deferred earnings,

“even at the reduced rates,” id., section 965 provides

various elections that qualifying taxpayers may use

to defer payment of the tax, see Defs.’ Cross-Mot. for

Summ J., ECF No. 57 [hereinafter Defs.’ Cross-Mot.],

Mem. in Supp. of Defs.’ Cross-Mot. for Summ. J. &

Resp. to Pls.’ Mot., ECF No. 57-1 [hereinafter Defs.’

Mem.], at 3 (citing 26 U.S.C. §§ 965(h), (i), (m), (n)).

For example, “[a]n election under subsection 965(h)

allows a taxpayer that has a transition tax liability

to pay it, interest free, in eight annual installments

unless a specified ‘acceleration’ event occurs.” Id. (citing

A.R. at 3524).

Finally, subsection 965(o) directs the Secretary

of the Treasury to “prescribe such regulations or other

guidance as may be necessary or appropriate to carry

out the provisions of th[e] section.” 26 U.S.C. § 965(o).

Those regulations are the subject of this lawsuit.

3. Promulgation of Regulations Implementing

the Transition Tax

On August 9, 2018, Treasury published in the

Federal Register a Notice of Proposed Rulemaking

under section 965, as well as related proposed regulations under sections 962 and 986. A.R. at 3554–

615; Guidance Regarding the Transition Tax Under

Section 965 and Related Provisions, 83 Fed. Reg.

39,514 (Aug. 9, 2018) (to be codified at 26 C.F.R. pt.

1). Pursuant to the RFA, the Notice of Proposed

App.30a

Rulemaking contained a certification by the Secretary

of the Treasury that the proposed regulations would

not “have a significant economic impact on a substantial

number of small entities,” and thus “an initial

regulatory flexibility analysis” was not performed.

A.R. at 3581; 83 Fed. Reg. 39,514, 39,540–41. The

RFA certification was based on several factors. First,

Treasury and the IRS estimated the average burden

of compliance with the regulations to be five hours,

which was “minimal . . . in comparison to other

regulatory requirements related to owning stock in a

specified foreign corporation.” A.R. at 3581. Second,

“the [information collection] requirements appl[ied]

only if a taxpayer cho[se] to make an election or [to]

rely on a favorable rule.” Id. Third, “the collections of

information appl[ied] to the owners of specified foreign

corporations,” not “the specified foreign corporations

themselves,” and thus “a small entity would not be

subject to the collections of information.” Id. And

fourth, “the collection of information requirements in

th[e] regulation appl[ied] primarily to persons that

are United States shareholders of foreign corporations,”

and, Treasury reasoned, “[t]he ownership of sufficient

stock in specified foreign corporations . . . generally

entails significant resources and investment, such

that businesses that are United States shareholders

are generally not small businesses.” Id. The certification

also noted that, “[p]ursuant to section 7805(f), th[e]

notice of proposed rulemaking ha[d] been submitted

to the Chief Counsel of Advocacy of the Small Business

Administration for comment on its impact on small

business.” Id.; id. at 3172; 26 U.S.C. § 7805(f).

Treasury received a number of comment letters

in response to the proposed regulations and various

App.31a

published guidances, including from Plaintiff Monte

Silver. See A.R. at 2459–74, 3525–26; Pls.’ Mot., Decl.

of Monte Silver, ECF No. 47-2 [hereinafter Silver

Decl.], ¶ 14. “The majority of comments,” Defendants

explain, “complained [not of the regulations but] of

the transition tax [itself].” Defs.’ Mem. at 5. “Only

three comments addressed the Regulatory Flexibility

Act analysis.” Id. (citing A.R. at 1187–193, 2445–58,

2459–92). Although given notice of the proposed

regulations by the IRS, the Small Business Administration (“SBA”) did not issue any public comments.

See id. at 7.

On February 5, 2019, Treasury published the

final regulations in the Federal Register. See Regulations Regarding the Transition Tax Under Section

965 and Related Provisions, 84 Fed. Reg. 1,838 (Feb.

5, 2019); A.R. at 3136–213. The final regulations

primarily finalized the proposed regulations, with

certain changes based on comments received. See A.R.

at 3526. Like the proposed regulations, the Final Regulations do not contain a Regulatory Flexibility Analysis. After reviewing the comments, Treasury determined and certified that the final regulations would

not have a significant economic impact on a substantial

number of small entities within the meaning of section

601(6) of the RFA. See id. at 3171. As explained in

the proposed regulations, Treasury determined that

the economic impact of the final regulations themselves would be minimal, because “[a]ny economic

impact of the final regulations stems from the collection

of information requirements” they established, and

those would not be extensive. Id. at 3172. Treasury

again estimated that “the average burden associated

with these collection of information requirements

App.32a

[would be] 5 hours, which is minimal, particularly in

comparison with other regulatory requirements related

to owning stock in a specified foreign corporation,”

and only applicable “if a taxpayer cho[se] to make an

election or rely on a favorable rule.” Id.

The final regulations also addressed comments

received in re sponse to the Notice o f Propo sed

Rulemaking. See A.R. at 3136–164 (addressing

comments throughout). With regard to comments

from Plaintiff and like-minded individuals about the

economic impact of the regulations on small businesses,

Treasury wrote: “The comments received regarding

the economic impact of the proposed regulations

principally focus on burdens imposed by the statute

(i.e., the tax due as a result of section 965) rather than

any additional burdens resulting from the proposed

regulations.” Id. at 3172. Therefore, the certification

explained, “the Treasury Department and the IRS []

determined that the final regulations w[ould] not

have a significant economic impact on a substantial

number of small entities.” Id.

B. Plaintiffs Monte Silver and Silver, Ltd.

Plaintiff Monte Silver is a U.S. citizen residing

in Israel. Defs.’ Resp. to Pls.’ Assertions of Fact in

Supp. of Pls.’ Mot. for Summ. J., ECF No. 57-5

[hereinafter Defs.’ Resp. to Facts], ¶ 1. Plaintiff Silver,

Ltd. (“Silver Limited”) is an Israeli corporation through

which Silver practices law. Id. ¶ 4 (citing Silver Decl.

¶ 2). Silver has always been the sole shareholder and

sole employee of Silver Limited. Id. ¶ 5 (citing Silver

Decl. ¶ 2). For U.S. tax purposes, Silver has reported

Silver Limited as a controlled foreign corporation on

Form 5471, “Information Return of U.S. Persons

App.33a

with Respect to Certain Foreign Corporations.” Id.

¶ 6 (citing Silver Decl. ¶ 2). Unrelated to his work

through Silver Limited, Silver also has individually

invested in U.S. commercial real estate since 2009,

and he reports the earnings from that business on

his individual tax return. See Defs.’ Resp. to Facts

¶ 8 (citing Silver Decl. ¶ 3).

In early January 2018, Silver says he learned

that the recently passed TCJA and transition tax

applied to him. See Silver Decl. ¶ 5. Over the following

month, he spoke to owners of other small businesses

abroad as well as tax professionals about the

complexities and implications of the transition tax.

Id. ¶ 6. In early March 2018, Silver launched a

“campaign through which small business owners

could email senior officials of the [Treasury and IRS]

to advise [the agencies] of their problems and [] seek

[] relief.” Id. ¶ 7. Around the same time, Silver

himself reached out to senior Treasury officials

including Lafayette (“Chip”) Harter, then Deputy

Assistant Secretary of the Treasury for International

Tax Affairs. Id. ¶ 8. The two met in Washington,

D.C., and discussed potential forms of relief for small

businesses facing the transition tax. Id. One form of

relief they discussed was a 60-day extension for small

businesses to make the first of the eight annual

transition tax payments under the Act, see 26 U.S.C.

§ 965(h). See Silver Decl. ¶ 8. Treasury granted that

relief, extending the deadline to June 15, 2018. Id.

On June 4, 2018, Treasury further extended the

deadline, granting small business owners with less

than $1,000,000 in transition tax liability a one-year

extension to make the first transition tax payment.

Id. ¶ 9.

App.34a

After the proposed regulations implementing

section 965 were released for public comment in

August 2018, Silver noticed the language in the regulations concerning the RFA. Id. ¶ 10. Through his

continued dialogue with Harter and other senior

officials at Treasury and the IRS, as well as in the

official comment he filed on the proposed regulations,

Silver shared his belief that Treasury had not complied

with the RFA. Id. ¶¶ 10–11; A.R. at 2459–74. Silver

says that “after extensive time trying to understand

the Transition tax and regulations,” he and Silver

Limited “filed [their] 2017 tax returns, including the

Transition tax parts.” Silver Decl. ¶ 18.

Critically, he did not end up owing any transition

tax. Id. Silver says he made a section “962 election”—

involving use of foreign tax credits—with his 2017

tax return, which may explain why his transition tax

zeroed out (though the record is less than clear on

this point). See Pls.’ Mem. in Opp’n to Defs.’ CrossMot. for Summ J. & in Reply to Defs.’ Opp’n to Pls.’

Mot. for Summ. J., ECF No. 61 [hereinafter Pls.’

Opp’n], Decl. of Monte Silver in Supp. of Pls.’ Reply,

ECF No. 61-1, ¶ 5. Silver subsequently twice amended

his tax return, including once to correct the section

962 election after noticing he had made an error. Id.

He attributes his need to make the amendments to

the complexity of the TCJA and the section 965 regulations. Silver Decl. ¶ 18. Silver claims the act of

trying to decipher and comply with the statute and

regulations “forced him to expend significant funds”

in filing his 2017 tax return. Id. Silver also claims

future burdens. He asserts that “[he] will be forced to

expend additional money on Transition tax-related

compliance for years to come, even though [he and

App.35a

Silver Limited] did not have any Transition tax

liability.” Id.

C. Procedural Background

On January 30, 2019, Plaintiffs filed this action

alleging that Defendants violated the RFA, the

Paperwork Reduction Act (“PRA”), and the Administrative Procedure Act (“APA”), in promulgating the final

regulations implementing section 965. See Compl., ECF

No. 1. In their initial Complaint, Plaintiffs asked the

court to declare Treasury’s section 605(b) certifications invalid and to remand the proposed and final

regulations to Defendants for compliance with the

RFA and PRA. See id. at 18. On March 26, 2019,

Plaintiffs amended their Complaint, removing the

cause of action under the PRA and adding to the

relief sought, “[t]o the exten[t] permissible by law, [a]

stay [of] enforcement of the Final Regulations and

Sections 965 and 962 against Plaintiffs and other

small businesses until such time as Defendants comply

with their statutory duties,” as well as a request for

attorney fees and any other relief the court may find

just and proper. See First Am. Compl., ECF No. 5

[hereinafter First Am. Compl.], at 19.

On July 1, 2019, Defendants moved to dismiss

for lack of jurisdiction, see Mot. to Dismiss, ECF No.

21, which the court denied on December 24, 2019, see

Silver v. IRS (Silver I), No. 19-cv-247 (APM), 2019

WL 7168625 (D.D.C. Dec. 24, 2019). In denying

Defendants’ motion, the court found that Plaintiffs

had made out a plausible basis for Article III standing.

See id. at *2. The court also held and that the AntiInjunction Act did not divest the court of subject

matter jurisdiction, given that Plaintiffs sought, in

App.36a

part, declaratory relief and a remand to perform an

RFA analysis. See id. *3. Defendants thereafter filed

an Answer to the First Amended Complaint, see ECF

No. 34, and produced the administrative record, see

ECF No. 38.

On April 22, 2020, Plaintiffs filed a motion to

complete the administrative record, seeking an order

authorizing inclusion of certain additional documents

in the record. See Pls.’ Mot. to Complete the A.R. &

for Other Appropriate Relief, ECF No. 39. Defendants

opposed Plaintiffs’ request on the grounds that much

of the material Plaintiffs seek to include in the

record is already present in it, and that Plaintiffs

have not shown that the administrative record is

incomplete. See Defs.’ Opp’n to Pls.’ Mot. to Complete

the A.R. & for Other Relief, ECF No. 42, at 2–3. The

court deferred ruling on Plaintiffs’ motion to complete

the record until summary judgment. Minute Order,

Apr. 24, 2020. The parties have now cross-moved for

summary judgment, see Pls.’ Mot.; Defs.’ Cross-Mot,

and this court heard oral argument on the parties’

cross-motions on March 15, 2021, see Minute Order,

Mar. 15, 2021.

III. Discussion

Defendants make two threshold arguments as to

why summary judgment should be granted in their

favor. First, they argue Plaintiffs lack standing to

bring this suit because Plaintiffs did not—nor will

they ever—owe any transition tax, and therefore

Plaintiffs have no future reporting obligations under

section 965 or the associated regulations. See Defs.’

Mem. at 11–14. Defendants next argue that the court

lacks “jurisdiction” to entertain Plaintiffs claims under

App.37a

the RFA because “neither Plaintiff qualifies as a

‘small entity’ afforded protection under the RFA.” Id.

at 14–18. As the court discusses below, the latter

argument is not jurisdictional, but rather a matter of

whether Plaintiffs have stated a claim under the RFA.

See Lexmark Int’l, Inc. v. Static Control Components,

Inc., 572 U.S. 118, 128 & n.4 (2014) (explaining that

although this inquiry, sometimes known as “statutory standing,” has been treated as jurisdictional in

the past, it really “ask[s] whether [plaintiff] has a

cause of action under the statute”).

The court begins its discussion where it must,

with consideration of its jurisdiction over Plaintiffs’

claims. See, e.g., Dominguez v. UAL Corp., 666 F.3d

1359, 1362 (D.C. Cir. 2012) (“[E]very federal court

has a ‘special obligation to satisfy itself’ of its own

jurisdiction before addressing the merits of any

dispute.”). Because the court concludes that Plaintiffs

lack standing to assert their claims, it does not address

the bulk of the parties’ arguments on the merits of

their cross-motions for summary judgment. It does,

however, decide the non-jurisdictional but stillthreshold issue of whether Plaintiffs have a cause of

action under the RFA as an alternative holding for

purposes of appellate review, if any.

A. Article III Standing

“Because Article III limits the constitutional role

of the federal judiciary to resolving cases and

controversies, . . . a showing of standing ‘is an essential

and unchanging’ predicate to any exercise of [a court’s]

jurisdiction.” Fla. Audubon Soc’y v. Bentsen, 94 F.3d

658, 663 (D.C. Cir. 1996) (quoting Lujan v. Defs. of

Wildlife, 504 U.S. 555, 560 (1992)). In order to satisfy

App.38a

the “irreducible constitutional minimum of standing,” a litigant must demonstrate that (1) they have

suffered an injury in fact—the invasion of a legally

protected interest; (2) the injury is fairly traceable to

the defendants’ challenged conduct (a causal connection); and (3) a favorable decision on the merits likely

will redress the injury. See Lujan, 504 U.S. at 560–

61. The alleged injury must be concrete and particularized and actual or imminent, not conjectural,

hypothetical or speculative. See Spokeo, Inc. v. Robins,

578 U.S. ___, ___, 136 S. Ct. 1540, 1548 (2016). “This

set of criteria implements Article III by limiting judicial intervention to only those disputes between

adverse parties that are ‘in a form . . . capable of judicial resolution.’” Fla. Audubon Soc’y, 94 F.3d at 663

(quoting Schlesinger v. Reservists Comm. to Stop the

War, 418 U.S. 208, 2018 (1974)).

In denying Defendants’ motion to dismiss, the

court recognized Plaintiffs’ asserted harm to be a

procedural injury, that is, “an injury resulting from

the violation of a procedural right created by statute.”

Silver I, 2019 WL 7168625, at *1. Neither Plaintiffs

nor Defendants on summary judgment argue otherwise.

In procedural injury cases, the standing “requirements

are modified somewhat.” Nat’l Wildlife Fed. v. U.S.

Army Corps of Eng’rs, 170 F. Supp. 3d 6, 11 (D.D.C.

2016) (citing Ctr. for Law & Educ. v. Dep’t of Educ.,

396 F.3d 1152, 1157 (D.C. Cir. 2005)). In order to

establish standing, plaintiffs must show “some concrete

interest” that is “adversely affected by the procedural

deprivation.” WildEarth Guardians v. Jewell, 738

F.3d 298, 305 (D.C. Cir. 2013); see Ctr. for Law &

Educ., 396 F.3d at 1159 (“Appellants must show both

(1) that their procedural right has been violated, and

App.39a

(2) that the violation of that right has resulted in an

invasion of their concrete and particularized interest.”).

Additionally, the redressability and imminence requirements are relaxed. What “a more relaxed

redressability requirement for procedural rights claims

mean[s] is that, instead of needing to establish that

compelling the agency to follow the correct procedure

would lead to a substantive result that favors the

[plaintiff’s] concrete interests, the [plaintiff] need

only show that its concrete interests could be better

protected.” Narragansett Indian Tribal Historic Pres.

Office v. Fed. Energy Regul. Comm’n, 949 F.3d 8, 13

(D.C. Cir. 2020). “In other words, the re laxed

redressability requirement is met when correcting

the alleged procedural violation could still change

the substantive outcome in the [plaintiff’s] favor; the

[plaintiff] need not go further and show that it would

effect such a change.” Id. “The party invoking federal

jurisdiction bears the burden of establishing these

elements.” Lujan, 504 U.S. at 561.

In ruling on Defendants’ motion to dismiss, this

court held that Plaintiffs had standing to advance

their claims. See Silver I, 2019 WL 7168625, at *2.

That ruling was based on the court’s finding that

Plaintiffs had stated facts sufficient to plausibly

show that they had suffered an injury in fact fairly

traceable to the actions of Defendants that was likely

to be redressed by a favorable decision on the merits.

Id. at *1–2. “Plaintiffs’ alleged injury,” the court

explained, “is the cost associated with complying with

the TCJA’s transition tax regulations, which include

certain ‘collection of information’ and ‘recordkeeping

obligations.’” Id. at *2 (quoting First Am. Compl. ¶ 54).

Plaintiff Silver averred that he “had been forced to

App.40a

spend significant funds” and would “be forced to

expend money on Transition tax-related compliance

for years to come, even though [he] did not report

any Transition tax liability.” Pls.’ Opp’n to Mot. to

Dismiss, ECF No. 23, Decl. of Monte Silver, ECF No.

23-2 [hereinafter Silver MTD Decl.], ¶ 18. Finding

Plaintiffs’ alleged injury to be causally connected to

Defendants’ alleged failure to undertake an RFA

analysis, the court concluded Plaintiffs had standing

to advance their claims. Silver I, 2019 WL 7168625,

at *2. The court did not address the element of

redressability. See id.

Now that the case is at summary judgment,

Plaintiffs attempt to hang their hat on the court’s

prior ruling. See Pls.’ Opp’n at 2–3 (“As the Court has

previously ruled . . . Plaintiffs have established

procedural standing.”). That is a losing proposition,

however, because Plaintiffs bear the burden of establishing standing “at the outset of each phase” of

litigation. Scenic Am., Inc. v. U.S. Dep’t of Trans.,

836 F.3d 42, 48 (D.C. Cir. 2016). A “court’s determination that a plaintiff has established standing at the

motion to dismiss stage by alleging sufficient facts in

her pleadings is only the first step.” Id. Such a

“finding does not obviate the court’s responsibility to

ensure that the plaintiff can actually prove those

allegations when one or both parties seek summary

judgment.” Id. For that reason, “[a] plaintiff’s burden

to demonstrate standing grows heavier at each stage

of the litigation.” Osborn v. Visa Inc., 797 F.3d 1057,

1063 (D.C. Cir. 2015). At the summary judgment

stage, a plaintiff “can no longer rest on . . . mere allegations, but must set forth by affidavit or other evidence specific facts which for purposes of the sum-

App.41a

mary judgment motion will be taken to be true.”

Lujan, 504 U.S. at 561 (citation and internal quotation

marks omitted). “If . . . the court determines that the

plaintiff has not introduced sufficient evidence into

the record to at least raise a disputed issue of fact as

to each element of standing, the court has no power

to proceed and must dismiss the case.” Scenic Am.,

Inc., 836 F.3d at 48–49.

With that legal framework in mind, the court

turns to Defendants’ standing challenge. In the main,

Defendants argue that Plaintiffs lack standing because

they have not “produce[d] concrete evidence of ongoing

or imminent future injury to support their claim for

injunctive relief.” Defs.’ Mem. at 11. That argument

is flawed, however, because Plaintiffs do not seek

only injunctive relief. To be sure, Plaintiffs request,

as a statutory remedy under the RFA, that the court

“stay [] enforcement of the Final Regulations and

Sections 965 and 962 against Plaintiffs and other

small businesses until such time as Defendants comply

with their statutory duties.” First Am. Compl. at 19;

5 U.S.C. § 611(a)(4)(B) (authorizing a court to order

“deferring the enforcement of the rule against small

entities unless the court finds that continued enforcement of the rule is in the public interest”). This is a

demand for prospective relief. But Plaintiffs also

seek retrospective relief. Specifically, they ask for a

declaration “that Treasury’s RFA Section 605(b) certifications are invalid,” and a “[r]emand [of] the

Proposed Regulations and Final Regulations to Defendants to comply with their statutory obligations.” First

Am. Compl. at 19. This distinction is an important one

because the Supreme Court has made clear that the

“injury in fact” requirement of standing varies

App.42a

depending on whether the plaintiff seeks prospective

or retrospective relief. See City of Los Angeles v.

Lyons, 461 U.S. 95, 101–02, 105 (1983). And the

party invoking standing “bears the burden of showing

that he has standing for each type of relief sought.”

Summers v. Earth Island Inst., 555 U.S. 488, 493

(2009). Thus, the court must give individual consideration to each form of requested relief on the question

of standing in this case. It turns now to that task,

starting with Plaintiffs’ claim for retrospective relief.

1. Retrospective Relief

A plaintiff seeking retrospective relief satisfies

the injury-in-fact requirement if he has suffered a

past injury that is concrete and particularized. See

Adarand Constructors, Inc. v. Pena, 515 U.S. 200,

210–11 (1995). Here, Defendants do not dispute that

Plaintiffs have established an injury in fact in the

form of past compliance costs associated with the

transition tax regulations. See Defs.’ Mem. at 11–14;

Reply in Supp. of Defs.’ Cross-Mot. for Summ. J.,

ECF No. 65 [hereinafter Defs.’ Reply], at 2–4. Plaintiffs

take that concession as evidence that the court’s

prior ruling on standing endures. See Pls.’ Opp’n. at

2–4. They explain, because “Plaintiffs have established

that they have been adversely affected by Defendants’

failure to comply with the RFA and have incurred a

concrete and particular injury in the form of the compliance costs they have expended[,] . . . [they] have

Article III standing to challenge the regulations []

under the RFA.” Pls.’ Opp’n at 4. The court disagrees.

Both parties overlook an essential element of

standing: redressability. The court did so, too, at the

motion to dismiss stage. See Silver I, 2019 WL

App.43a

7168625, at *2. As discussed, courts have held that

the redressability requirement for standing is “relaxed”

in procedural rights cases. See WildEarth Guardians,

738 F.3d at 305; see also, e.g., Lujan, 504 U.S. at 572

n.7; Ctr. for Law & Educ., 396 F.3d at 1159. But

“relaxed” does not mean “eliminated.” See Ctr. for

Law & Educ., 396 F.3d at 1157 (“Where plaintiffs

allege injury resulting from violation of a procedural

right afforded to them by statute and designed to

protect their threatened concrete interest, the courts

relax—while not wholly eliminating—the issues of

imminence and redressability.” (second emphasis

added)). “Rather, the ‘relaxation’ of the redressability

requirement recognizes the difficulty plaintiffs

[typically] face in showing that the righting of a

procedural wrong will necessarily lead to a different

substantive outcome.” Nat’l Wildlife Fed., 170 F.

Supp. 3d at 15. In such cases, a plaintiff has standing

to bring a claim so long as “they have a procedural

right that, if exercised, could protect their concrete

interests.” Defs. of Wildlife v. U.S. EPA, 420 F.3d 946,

957 (9th Cir. 2005) (emphasis in original), overruled

on other grounds by Nat’l Ass’n of Home Builders v.

Defs. of Wildlife, 551 U.S. 644 (2007). For example,

the “archetypal procedural injury” case involves “an

agency’s failure to prepare a statutorily required

environmental impact statement before taking action

with potential adverse consequences to the environment.” Nat’l Parks Conservation Ass’n v. Manson, 414

F.3d 1, 5 (D.C. Cir. 2005). The Supreme Court provides

such an example in footnote 7 of Lujan, explaining

that

[a person] living adjacent to the site for

proposed construction of a federally licensed

App.44a

dam has standing to challenge the licensing

agency’s failure to prepare an environmental

impact statement, even though he cannot

establish with any certainty that the statement will cause the license to be withheld

or altered, and even though the dam will

not be completed for many years.

Lujan, 504 U.S. at 572 n.7. While the plaintiff in that

hypothetical case cannot establish with any certainty

that preparation of the environmental impact statement—that is, the righting of the procedural wrong—

will remedy her concrete interest by preventing the

construction of the dam, such a result is at least

possible.

This is not the archetypal procedural injury

case, however. “Decisions in this Circuit and others

confirm that a court must look at the underlying

concrete interest when assessing redressability of a

procedural injury.” Nat’l Wildlife Fed’n, 170 F. Supp.

3d at 15; see In re Idaho Conservation League, 811

F.3d 502, 511 –12 (D.C. Cir. 2016) (asse ssing

redressability of procedural injuries by looking at

whether promulgating a different rule would limit

plaintiffs’ exposure to hazardous waste); Ass’n of Am.

Physicians & Surgeons v. Sebelius, 746 F.3d 468, 472

(D.C. Cir. 2014) (assessing redressability of a procedural

injury by looking at “whether compliance with the

procedural requirement would lead to ‘redress’ of the

party’s substantive injury (i.e., lead to a less injurious

outcome)”); Black v. LaHood, 882 F. Supp. 2d 98,

106–07 (D.D.C. 2012) (holding that plaintiffs could

not show redressability because the alleged “concrete

injuries” caused by the road closure would remain

even if the court declared the approval of the project

App.45a

unlawful); cf. Sierra Club v. U.S. Army Corps of

Eng’rs, 277 F. App’x 170, 173 (3d Cir. 2008) (finding

that redressing procedural harms under the CWA,

NEPA, and APA would not redress alleged injuries to

plaintiffs’ recreational and aesthetic interests because

the wetlands they enjoyed were gone and plaintiffs

did not ask that the existing structures be removed).

For example, in Salmon Spawning & Recovery

Alliance v. Gutierrez, the Ninth Circuit held that several conservation groups lacked standing to bring a

suit challenging federal agencies’ decision to enter,

and remain a party to, the Pacific Salmon Treaty

with Canada on behalf of the United States because

the Treaty itself was final. 545 F.3d 1220, 1227 (9th

Cir. 2008). The groups alleged that the federal agencies

violated consultation procedures required by regulation

prior to entering the Treaty and that the agencies’

procedural failure threatened various concrete interests

of the group. Id. at 1225. In considering its jurisdiction

over the matter, the court stre sse d that “the

redressability requirement is not toothless in procedural

injury cases.” Id. at 1227. The court observed that if

it were to “give the groups the remedy [] they seek—

that [the federal agencies] follow the proper procedures

during [the] consultation process—the ultimate agency

decision of whether to enter into the Treaty with

Canada”—made nine years earlier—”could never be

influenced.” Id. “In effect,” the court concluded, “if [it]

rule[d] against the groups’ claim of procedural injury

they w[ould] continue to suffer injury; and if [it]

rule[d] in their favor, they w[ould] still suffer injury

because [the court] cannot undo the Treaty.” Id.

A similar result obtains here. If the court were

to grant the retrospective relief Plaintiffs seek—

App.46a

declaring unlawful the agency’s failure to perform an

RFA analysis and remanding to conduct the analysis—

such relief would do nothing to redress Plaintiffs’

claimed concrete injury. Plaintiffs have already incurred

the compliance costs associated with the one-time

transition tax, and Silver declares that “neither [he]

nor Limited ended up owing any Transition tax at

all.” Silver Decl. ¶ 18. Granting the requested

retrospective relief therefore would do nothing to

undo the compliance costs Plaintiffs already have

incurred. Thus, the only way Plaintiffs can satisfy

the redressability prong of the standing analysis,

even for retrospective relief, is if they have some

future injury from the transition tax regulations that

the agency could possibly alleviate on remand. In

this way, the redressability inquiry for retrospective

relief, in this case, dovetails with the injury-in-fact

requirement for prospective relief. At oral argument,

Plaintiffs agreed the two inquiries merge in this

case. Hr’g Tr. (draft), Mar. 15, 2021 [hereinafter Hr’g

Tr.], at 45–46.

The court now turns to whether Plaintiffs have

met their burden of establishing a future injury.

2. Prospective Relief

To seek injunctive relief, a plaintiff must show

that he is suffering a continuing injury or that he is

under a real and immediate threat of being injured

in the future. See Lyons, 461 U.S. at 101–02; Dearth

v. Holder, 641 F.3d 499, 501 (D.C. Cir. 2011); see also

Summers, 555 U.S. at 493 (“To seek injunctive

relief, . . . the threat must be actual and imminent,

not conjectural or hypothetical.”). Here, Plaintiffs

dispute that a showing of future injury is required,

App.47a

see supra p. 15, which is incorrect;5 they nevertheless

assert that they have established future injury. See

Pls.’ Opp’n at 3–6. For the following reasons, the court

disagrees.

Recall that at the summary judgment stage of

proceedings, plaintiffs “can no longer rest on . . . mere

allegations, but must set forth by affidavit or other

evidence specific facts” demonstrating standing. Lujan,

504 U.S. at 561 (cleaned up) (emphasis added). The

“[s]tatements of fact must be sufficiently specific to

rise above the level of ‘conclusory allegations.’” Swanson

Group Mfg. LLC, 790 F.3d at 240 (quoting Lujan v.

Nat’l Wildlife Fed’n, 497 U.S. 871, 888 (1990)). While

“general factual allegations of injury resulting from

the defendant’s conduct may suffice” to show standing

at the motion to dismiss stage, Lujan, 504 U.S. at

561, “at summary judgment a court will not presume

the missing facts necessary to establish an element

of standing,” Swanson Grp. Mfg. LLC, 790 F.3d at

240 (cleaned up).

Here, Defendants contest that Silver will incur

future compliance costs as a result of the section 965

regulations. See Defs.’ Mem. at 11–14; Defs.’ Resp. to

Facts ¶ 12. Defendants state:

5 For the first time at oral argument, Plaintiffs argued that

“they need not establish standing in order to raise [their] RFA

claim” because the “unconventional” injunction they seek is a

statutorily mandated form of relief for violations of the RFA.

See Hr’g Tr. at 41–42 (discussing 5 U.S.C. § 611(a)(4)(B)). Plaintiffs provide absolutely no authority for such a proposition, and

because that issue has not been briefed, the court need not, and

does not, consider it. See Physicians for Social Resp. v. Wheeler,

956 F.3d 634, 647 (D.C. Cir. 2020) (“[G]enerally, arguments

raised for the first time at oral argument are forfeited.”).

App.48a

[It is] [d]isputed that Plaintiffs will incur

any ‘compliance costs and time’ to comply with

the statute or the Final Regulations, given

that they owe no Transition Tax based on

their own tax reporting. The reporting

required under the regulations is a “onetime paperwork burden.” ADMIN_03169

(“The Treasury Department and the IRS

antic ipate substantially all paperwork

burdens related to the final regulations to

be incurred only with respect to the inclusion

year.”). There is the possibility of further

minimal reporting required for those that

have a transition tax liability and elect to

defer or pay it in installments. See id. (“Any

subsequent reporting (such as in connection

with a transfer of a section 965(h) net tax

liability or a section 965(i) net tax liability)

would be negligible burdens that implement

elections made and payments calculated in

the inclusion year.”); [] ADMIN_03544 (“Information is collected for the purposes of

determining the amount of the tax liability

as well as tracking the payment of the tax

liability.”); ADMIN_03549 (“The information

collected . . . will be used to allow taxpayers

to make elections or file agreements to

continue deferring the payment of the section

965 tax liability. The information collected

will enable taxpayers and the IRS to keep

track of the deferred payments/liabilities

until fully paid.”). But there is no ongoing

paperwork burden where Plaintiffs have no

transition tax liability.

App.49a

Defs.’ Resp. to Facts ¶ 12 (emphasis added). So, with

no future transition tax liability to speak of, Defendants

say, Plaintiffs will incur no future compliance costs.

Having come forward with evidence showing that

Plaintiffs have no future injury, the burden shifts to

Plaintiffs to introduce “sufficient evidence into the

record to at least raise a disputed issue of fact as to”

injury. Scenic Am., Inc., 836 F.3d at 48–49. They fail

to do so.

Plaintiffs rely on three declarations submitted

by Plaintiff Silver over the course of the litigation to

demonstrate standing. None “rise above the level of

‘conclusory allegations’” on the topic of injury. Swanson

Group Mfg. LLC, 790 F.3d at 240 (quoting Nat’l

Wildlife Fed’n, 497 at 888). Silver’s declaration in

support of Plaintiffs’ motion for summary judgment

includes only one line regarding future injury. After

discussing the time and resources that Silver in the

past put into compliance, Silver baldly declares as a

final point: “I will be forced to expend additional

money on Transition tax-related compliance for years

to come, even though we did not have any Transition

tax liability.” Silver Decl. ¶ 18. That is nearly verbatim

the language that appeared in the declaration Silver

filed in support of Plaintiffs’ opposition to Defendants’

motion to dismiss. See Silver MTD Decl. ¶ 18. Such

an unadorned statement of future injury is insufficient

to carry Plaintiffs’ burden at this stage of the case.

See Nat’l Wildlife Fed’n, 497 U.S. at 888.

Plaintiffs attempt to salvage their position on

future injury in their reply brief by launching into a

lengthy and, frankly, impenetrable explanation of

the purported future reporting obligations and compliance costs Silver will incur by virtue of a so-called

App.50a

“section 962” election he made in conjunction with

his transition tax filing. See Pls.’ Opp’n at 4–6. From

what the court can discern from the parties’ briefs

and the discussion at oral argument, the transition

tax regulations contain a provision that allows U.S.

shareholders subject to the tax to elect to apply

foreign tax credits to offset their transition tax liability.

See Pls.’ Opp’n at 4. The statute giving rise to that

ability resides in a separate portion of the tax code,

section 962, which pre-dates the TCJA by decades

and allows a natural person to be treated as a corporation for purposes of certain foreign earnings taxation.

5 U.S.C. § 962; see Pls.’ Opp’n at 4–5; Hr’g Tr. at 24–

25; A.R. at 3524 (“[S]hareholders may use foreign tax

credits, in accordance with the pre-Act rules, to offset

their inclusions under section 965.” (emphasis added)).

Although previously rarely invoked, section 962 was

given attention anew by the transition tax regulations.

See Pls.’ Opp’n at 4 n.3 (“The IRC 962 election is an

archaic provision that was rarely used before the

introduction of the Transition tax.”).

Plaintiffs explain that Silver opted to make use

of the election because it was “[t]he only way that

[he] (an individual shareholder) could have enjoyed

the same benefit of 10 years credits for Isr aeli

corporate taxes paid by Silver Ltd was by making an

IRC 962 election.” Pls.’ Opp’n at 4. “As a result” of

the election, Plaintiffs claim,

each time that Silver receives a dividend

from Silver Ltd., Silver must comply with a

wide variety of the most complex tax laws

in the IRC, such as foreign tax credit

accounting, allocation between dividends

tainted and not tainted by the 962 election,

App.51a

a bilateral tax treaty, qualified/non-qualified

dividends, etc.

Pls.’ Opp’n at 5.

But these are the arguments of counsel, not

factual averments, which the court cannot rely upon

at this stage to establish standing. See FW/PBS, Inc.

v. City of Dallas, 493 U.S. 215, 235 (1990). And, even

if the court were to treat these arguments as facts,

they make out an insufficient case of future harm.

For one, future injury must be “actual and imminent”

to establish standing. See Summers, 555 U.S. at 493.

Plaintiffs, however, say nothing about when Silver

Limited might issue a dividend to Silver that would

trigger the claimed compliance obligations. Additionally, it is far from evident that the section 965 regulations would be the cause of such costs. The quoted

text above identifies some of the “most complex tax

laws in the IRC” as the source of future compliance

costs—including section 962 and an unidentified

bilateral tax treaty—but notably absent from the list

are the challenged regulations themselves. Plaintiffs

say not a word about how the section 965 regulations

will impose future recordkeeping or reporting burdens.

This omission likewise negates any showing as to

redressability. Plaintiffs fail to explain how conducting

an RFA analysis in connection with the 965 regulations

could help him avoid costs imposed by other provisions

of the tax code or a tax treaty.

Accordingly, because Plaintiffs have failed to provide facts sufficiently specific to rise above the level of

‘conclusory allegations’” to show that they face ongoing

or imminent future injury, Plaintiffs lack standing to seek injunctive relief. See Lujan, 497 U.S. at

888 (1990); Summers, 555 U.S. at 493. And because

App.52a

Plaintiffs also must show ongoing or imminent future

injury to satisfy the redressability requirement for

retrospective relief, see supra p. 20, they similarly lack

standing to assert their claim for declaratory relief

and a remand. The court thus concludes that it lacks

jurisdiction over Plaintiffs’ claims in their entirety.

B. “Statutory Standing”

Defendants next argue that the court lacks

“jurisdiction” as to Plaintiffs’ claims because neither

qualifies as a “small entity” within the meaning of

the RFA. See Defs.’ Mem. at 15–18. But as previewed

above, this is a “statutory standing” argument, which

the Supreme Court has clarified is not jurisdictional

but rather a question of whether Plaintiffs have a

cause of action under the statute. See Lexmark Int’l

Inc., 572 U.S. at 128 & n.4. Because this is a threshold

question, the court considers the issue, and finds

that Plaintiffs fail to state a claim under the RFA.

The court begins with the language of the RFA.

In section 611, the statute makes clear the zone of

interests it protects and the cause of action it provides.

See 5 U.S.C. § 611(c) (“Compliance or noncompliance

with the provisions of this chapter shall be subject to

judicial review only in accordance with this section.”);

Permapost Prods., Inc. v. McHugh, 55 F. Supp. 3d 14,

30 (D.D.C. 2014). Judicial review under the RFA is

available only for “a small entity that is adversely

affected or aggrieved by final agency action.” 5 U.S.C.

§ 611(a)(1) (emphasis added). The D.C. Circuit has

consistently interpreted that language to “limit[] its

application to the ‘small entities which will be subject

to the proposed regulation’—that is, those ‘small entities

to which the proposed rule will apply.’” Aeronautical

App.53a

Repair Station Ass’n, 494 F.3d at 176 (quoting Mid-Tex

Elec. Coop., Inc., 773 F.2d at 342); see also Cement Kiln

Recycling Coal., 255 F.3d at 869 (same).

There are thus two questions the court must

answer to determine whether Plaintiffs have a cause

of action under the RFA: 1) whether they are “subject

to” the transition tax regulations, and 2) whether they

qualify as “small entities” under the RFA. Neither

Plaintiff satisfies both requirements.

1. Whether Plaintiffs are “Subject to”

the Transition Tax Regulations

To reiterate what should be clear by now,

section 965 imposes a one-time transition tax on U.S.

taxpayers who are shareholders of certain foreign

corporations. See A.R. at 3522; see, e.g., 26 U.S.C.

§ 965(b) (directing requirements on “a taxpayer which

is a United States shareholder with respect to at

least one deferred foreign income corporation”). To

that end, the final regulations implementing section

965 explain, in summary, that they “affect United

States persons with direct or indirect ownership

interests in certain foreign corporations.” 84 Fed.

Reg. 1,838 (emphasis added); A.R. at 3134 (emphasis

added). For purposes of section 965, a “United States

person” is a citizen or resident of the United States, a

domestic partnership or corporation, and certain estates

and trusts. See 26 U.S.C. § 951(b) (definition of “United

States shareholder” cross references definition of

“United States person” in 26 U.S.C. § 957(c)); 26

U.S.C. § 957(c) (cross-referencing definition of “United

States person” in 26 U.S.C. § 7701(a)(30)); 26 U.S.C.

§ 7701(a)(30). There is no disputing that Monte Silver,

as a U.S. person and sole shareholder of a controlled

App.54a

foreign corporation, is “subject to” the transition tax

regulations. See Defs.’ Resp. to Facts ¶¶ 1, 5. The

parties disagree, however, as to whether Silver Limited

is.

As a corporation located in and organized under

the laws of Israel, Silver Limited is not a citizen or

resident of the United States, a domestic partnership

or corporation, or a qualifying trust or estate. See

Defs.’ Mem. at 9; Silver Decl. ¶ 2 (identifying Silver

Limited as a controlled foreign corporation); see also

Hr’g Tr. at 6 (admitting that Silver Limited is not a

U.S. taxpayer). That would seem to categorically disqualify the company from being subject to the transition

tax regulations, but Plaintiffs contend otherwise. At

oral argument, they made two arguments as to why

Silver Limited is nevertheless subject to the transition

tax regulations. Neither is persuasive.

First, Plaintiffs argue that Defendants conceded

that Silver Limited is “subject to” section 965 in their

response to Plaintiffs’ assertions of fact, see Defs.’

Resp. to Facts ¶ 7 (noting that it is “[n]ot disputed”

that “Limited and Silver are both subject to Code

Section 965 and the Final Regulations”). See Hr’g Tr.

at 4–5. While the court was also perplexed by that

apparent concession, Defendants assert that it was

done in error. See id. at 18. At oral argument,

Defendants explained that they drafted and filed the

document containing their responses to Plaintiffs’

statements of facts under the mistaken impression

that the local rules required it and that Plaintiffs

had themselves failed to file a separate statement of

facts. Id. According to counsel for Defendants, the

statement in Paragraph 7, that Defendants did “[n]ot

dispute[]” that Silver Limited was subject to the

App.55a

transition tax, was an “inadvertent admission,” and

Defendants request that the court disregard it all

together. Id.

One need look no further than the memorandum

of law accompanying Defendants’ response to Plaintiffs’

statement of facts to see that their apparent concession

was inadvertent. On page 13, Defendants assert:

“Silver Limited is a foreign corporation and is not

itself subject to the transition tax. After all, that tax

applies only to United States Shareholders . . . , and

Silver Limited is not a U.S. shareholder at all.” Defs.’

Mem. at 13 (emphasis added); see also id. at 17

(“Silver Limited does not file U.S. tax returns and

does not even have a U.S. employer identification

number.”). Moreover, Defendants’ inadvertent admission does not foreclose the court from addressing

whether Silver Limited is subject to the transition

tax regulations because that is a question of law, not

fact. See Aeronautical Repair Station Ass’n, Inc., 494

F.3d at 176 (assessing as a matter of law whether an

entity is subject to an underlying regulation). It is

therefore not susceptible to judicial admission, as

“‘[i]t is well established that judicial admissions on

questions of law have no legal effect.’” McNamara v.

Picken, 950 F. Supp. 2d 125, 129 (D.D.C. 2013)

(quoting Dabertin v. HCR Manor Care, Inc., 68 F.

Supp. 2d 998, 1000 (N.D. Ill. 1999)); see also U.S. ex

rel. Miller v. Bill Harbert Int’l Constr., Inc., No. 95cv-1231 (RCL), 2007 WL 851871, at *1 (D.D.C. Mar.

14, 2007) (“A judicial admission is usually treated as

absolutely binding, but such admissions go to matters

of fact which, otherwise, would require evidentiary

proof.” (quoting New Amsterdam Cas. Co. v. Waller,

App.56a

323 F.2d 20, 24 (4th Cir. 1963)). Accordingly, the

court disregards Defendants’ inadvertent admission.

Second, Plaintiffs argue that Silver Limited is

“subject to” the regulations because it is Silver Limited

from which Silver must collect information to comply

with the transition tax regulations and the two

should be viewed as a “package” deal. See Hr’g Tr. at

5–7. Such an argument—that a shareholder and a

corporation should be viewed as one and the same—

flies in the face of the longstanding principle that “[a]

corporation is ordinarily to be viewed as a distinct

entity, even when it is wholly owned by a single individual.” Quinn v. Butz, 510 F.2d 743, 757 & n.90

(D.C. Cir. 1975) (citations omitted) (citing cases); see

also Moline Properties v. Cmm’r, 319 U.S. 436, 438–

39 (1943) (explaining the various purposes of “[t]he

doctrine of corporate entity,” and finding that “so

long as that purpose is the equivalent of business

activity . . . the corporation remains a separate taxable

entity”). As the court admonished at oral argument,

surely Silver would take a different position as to his

relationship with Silver Limited in a scenario in

which he was being held individually liable for the

acts of the company. Silver cannot pick and choose

when to benefit from the corporate form.

Nothing within the transition tax regulations

directs a foreign company to take any action. In

Aeronautical Repair Station Association, Inc., the

D.C. Circuit made clear that an entity is not “subject to”

a regulation unless the regulation “imposes responsibilities directly on” the entity. See 494 F.3d at 177;

see also Mid-Tex Elec. Coop., Inc., 773 F.2d at 342

(holding that the RFA’s requirements apply only to

“small entities that would be directly regulated” by a

App.57a

challenged rule). At oral argument, Plaintiffs identified

for the first time a group of provisions within the

section 965 regulations that they contend apply to

Silver Limited. See Hr’g Tr. at 10–11 (citing A.R. at

3172). But none of those provisions apply “directly”

to the controlled foreign corporation; each applies

“directly” to the U.S. taxpayer. 6 That a U.S. taxpayer

has to look to the books and records of the foreign

company of which it is a shareholder to comply with

the regulations does not make the company itself

“subject to” the regulations.

Accordingly, the court concludes that only Silver

is “subject to” the transition tax regulations.

2. Whether Silver Qualifies as a “Small

Entity”

That leaves the court with one final question to

answer: whether Silver qualifies as a “small entity”

under the RFA. He does not. The RFA defines “small

entities” as having the same meaning as the terms

“small business,” “small organization,” and “small

governmental jurisdiction,” as defined in the RFA. 5

U.S.C. § 601(6). Of those defined terms, Silver could

conceivably fall only under the term “small business.”

That term “has the same meaning as the term ‘small

business concern’ under section 3 of the Small Business

Act.” Id. § 601(3). Section 3 of the Small Business Act

states that such a concern is “one which is independently owned and operated and which is not dominant

6 See A.R. 3171–72 (citing 26 C.F.R. §§ 1.965-2(d)(2)(ii)(B), 1.9652(f)(2)(iii)(B), 1.965-3(b)(2), 1.965-3(c)(3), 1.965-4(b)(2)(i), 1.9654(b)(2)(iii)(B), 1.965-7(b)(2), 1.965-7(b)(3)(iii)(B), 1.965-7(c)(2), 1.9657(c)(3)(iv)(B), 1.965-7(c)(3)(v)(D), 1.965-7(c)(6)(i), 1.965-7(d)(3),

1.965-7(e)(2), 1.965-7(f)(5), and 1.965-8(c)).

App.58a

in its field of operation.” 15 U.S.C. § 632(a)(1). Silver,

as an individual, is not “independently owned and

operated.”

Plaintiffs nevertheless attempt to shoehorn Silver

into meeting the “small business concern” definition

by virtue of his status as the sole proprietor of his

real estate investing business. See Pls.’ Opp’n at 10;

Hr’g Tr. at 56–57. But whatever status Silver may

hold in relation to his real estate business is irrelevant

to whether he qualifies as a small entity under the

RFA for the purposes of this case. As stated, to state a

cause of action, Silver must be a “small entit[y] . . .

subject to the proposed regulation,” Aeronautical

Repair Station Ass’n, 494 F.3d at 176—in this case,

the transition tax regulations. Silver is not subject to

the transition tax in his capacity as a real estate

investor. By his own admission, his real estate

investments are made in his individual capacity

“unrelated to [Silver] Limited.” Silver Decl. ¶ 3. Accordingly, Silver is not a small entity for the purposes of

the RFA and therefore has no cause of action under

the statute.

IV. Conclusion

For the foregoing reasons, the court grants

Defendants’ Cross-Motion for Summary Judgment,

ECF No. 57, and denies Plaintiffs’ Motion for Summary

Judgment, ECF No. 47. Relatedly, Plaintiffs’ Motion

to Complete the Administrative Record, ECF No. 39,

is denied as moot.

A separate final Order accompanies this Memorandum Opinion.

/s/ Amit P. Mehta

App.59a

United States District Court Judge

Dated: March 28, 2021

App.60a

MEMORANDUM OPINION AND ORDER

OF THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

(DECEMBER 24, 2019)

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

________________________

MONTE SILVER, ET AL.,

Plaintiffs,

v.

INTERNAL REVENUE SERVICE, ET AL.,

Defendants.

________________________

Civil No. 19-cv-247 (APM)

Before: Amit P. MEHTA,

United States District Court Judge.

MEMORANDUM OPINION AND ORDER

As part of the Tax Cut and Jobs Act of 2017

(“TCJA”), Congress enacted certain “transition tax”

provisions applicable to “controlled foreign corporations”

owned by “United States persons.” See generally Pub.

L. 115-97, 131 Stat. 2054 (2017). On January 15, 2019,

Defendants Internal Revenue Service and United

States Department of Treasury published final regulations to effectuate these tax provisions.

App.61a

Plaintiff Monte Silver is the sole shareholder of

Monte Silver, Ltd., a company based in Israel. Plaintiffs

assert that they are subject to the TCJA’s transition

tax provisions. They bring this action to challenge

Defendants’ alleged failure, in connection with

promulgating the TCJA’s final regulations, to carry

out required small-business impact evaluations under

the Regulatory Flexibility Act and the Paperwork

Reduction Act. Defendants now move to dismiss

Plaintiffs’ Complaint. Defendants maintain that the

court lacks subject-matter jurisdiction over this action

because (1) Plaintiffs lack standing, and (2) the AntiInjunction Act and the tax exception to the Declaratory

Judgment Act prohibit this lawsuit. See generally

Defs.’ Mot. to Dismiss for Lack of Jurisdiction, ECF

No. 21 [hereinafter Defs.’ Mot].

For the reasons that follow, Defendants’ Motion

is denied. Relatedly, Plaintiffs’ Motion to Expedite,

ECF No. 27, is denied as moot.

I.

A plaintiff in federal court bears the burden of

showing that she meets the “irreducible constitutional

minimum” of Article III standing: (1) injury in fact,

(2) causation, and (3) redressability. Lujan v. Defs. of

Wildlife, 504 U.S. 555, 560-61 (1992). To establish

standing, as here, at the motion to dismiss stage, the

plaintiff “must state a plausible claim that [she has]

suffered an injury in fact fairly traceable to the

actions of the defendant that is likely to be redressed

by a favorable decision on the merits.” Food & Water

Watch, Inc. v. Vilsack, 808 F.3d 905, 913 (D.C. Cir.

2015) (quoting Humane Soc’y of the U.S. v. Vilsack,

797 F.3d 4, 8 (D.C. Cir. 2015)). The court must accept

App.62a

the well-pleaded allegations of the complaint as true

and draw all inferences in favor of the plaintiff. Arpaio

v. Obama, 797 F.3d 11, 19 (D.C. Cir. 2015).

Here, Plaintiffs allege what is known as a

“procedural injury,” that is, an injury resulting from

the violation of a procedural right created by statute.

See Ctr. for Law & Educ. v. Dep’t of Educ., 396 F.3d

1152, 1157 (D.C. Cir. 2005). In such cases, the

redressability and imminence requirements of standing

are relaxed. See Wildearth Guardians v. Jewell, 738

F.3d 298, 305 (D.C. Cir. 2013). The plaintiff need not

show that “but for the alleged procedural deficiency

the agency would have reached a different substantive

result.” Id at 306. Rather, she need only establish

that the agency violated a procedural right designed

to protect her interests, and that it is plausible “‘that

the procedural breach will cause the essential injury

to the plaintiffs own interest.’” Ctr. for Law & Educ.,

396 F.3d at 1159 (quoting Fl. Audubon Soc. v. Bentsen,

94 F.3d 658, 664-65 (D.C. Cir. 1996) (en banc)). In

other words, “the requirement of injury in fact is a

hard floor of Article HI jurisdiction that cannot be

removed by statute.” Summers v. Earth Island Inst.,

555 U.S. 488, 497 (2009). “A procedural injury claim

therefore must be tethered to some concrete interest

adversely affected by the procedural deprivation. . . . ”

WildEarth Guardians, 738 F.3d at 305.

Plaintiffs’ alleged injury is the cost associated

with complying with the TJCA’s transition tax

regulations, which include certain “collection of information” and “recordkeeping obligations.” Am. Compl.,

ECF No. 5 [hereinafter Am. Compl.], ¶ 54. Plaintiffs

complain that the regulations have “imposed significant

burdens on Plaintiffs and other small businesses,”

App.63a

including “forc[ing] small businesses to spend enormous

amounts of time in futile efforts just to try and

understand what [the regulations] mean[],” and

“forc[ing] small businesses to expend significant funds

to try and comply” with the regulations. Id. ¶¶ 33-34.

Plaintiff Silver declares: “[I]n trying to comply with

the statute and regulations . . . I have been forced to

spend significant funds. Worse still, I will be forced

to expend money on Transition tax-related compliance for years to come, even though I did not report

any Transition tax liability.” Decl. of Monte Silver,

ECF No. 23-2, ¶ 18. These asserted facts plausibly

establish a concrete injury to support standing. See

State Nat. Bank of Big Spring v. Lew, 795 F.3d 48, 53

(D.C. Cir. 2015) (holding that regulated bank had

standing where “monitoring program” devised to comply

with regulations “cause[d] it to incur costs”); Ass’n of

Private Sector Colls. & Univs. v. Duncan, 681 F.3d

427, 458 (D.C. Cir. 2012) (finding that regulated

schools were “harmed because they will face even

greater compliance costs” and thus had standing).

Notwithstanding Plaintiffs’ straightforward injury

and the relaxed redressability standard, Defendants

still dispute standing on the element of causation.

They assert that Plaintiffs’ quarrel is with the TCJA

rather than the regulations, and thus any alleged

injury stems from the TCJA itself and not the agencies’

newly adopted regulations. Defs.’ Mot. at 8-11. But

this argument fundamentally misconstrues Plaintiffs’

claims. Plaintiffs are not challenging any specific

regulation that might or might not be traceable

directly to the TCJA. Rather, Plaintiffs allege that

the agencies neglected to undertake procedural

measures designed to protect small business from the

App.64a

burden of unwieldy and cost-intensive regulations—

namely, the publishing of an initial and a final

regulatory flexibility analysis, 5 U.S.C. §§ 601, 603(a),

and a certification that the regulation has reduced

compliance burdens on small businesses, 44 U.S.C.

§ 3506. Plaintiffs alleged injuries are therefore traceable

to Defendants’ alleged violation of these separate

statutory requirements, not the TCJA. Causation is

easily satisfied. See Fl. Audubon Soc., 94 F.3d at 664

(stating that a “plaintiff alleging a procedural violation

[must show] a causal connection between the government action that supposedly required the disregarded

procedure and some reasonably increased risk of

injury to its particularized interest”).

Accordingly, the court rejects Defendants’ assertion

that Plaintiffs lack standing to advance their claims.

II.

Defendants fare no better with their argument

that the court lacks subject-matter jurisdiction under

the Anti-Injunction Act and the tax exception to the

Declaratory Judgment Act. Defendants contend that

Plaintiffs’ suit is barred because it challenges regulations implementing Sections 965, 962, and 951 of the

Internal Revenue Code, and invalidating those regulations would directly prevent the collection of taxes.

Defs.’ Mot. at l, 14. Plaintiffs respond that the AntiInjunction Act prohibits only those suits seeking to

restrain the assessment and collection phases of the

taxation process—not challenges to the antecedent

procedural steps that are the subject of this lawsuit.

Moreover, they argue, the Anti-Injunction Act does

not apply where, as here, Plaintiffs have no other

avenue to litigate their claims because they do not

App.65a

owe a transition tax liability. Pls.’ Opp’n to Mot. to

Dismiss, ECF No. 23, at 15-19.

The Anti-Injunction Act bars judicial review of

lawsuits filed “for the purpose of restraining the

assessment or collection of any tax.” 26 U.S.C.

§ 7421(a). Similarly, the Declaratory Judgment Act

excludes from its purview actions “with respect to

Federal taxes.” 28 U.S.C. § 2201(a). The D.C. Circuit

has explained that the Anti-Injunction Act and the

tax provision of the Declaratory Judgment Act are

“coterminous.” Cohen v. United States, 650 F.3d 717,

730-31 (D.C. Cir. 2011) (en banc). Therefore, for

simplicity, the court focuses on the Anti-Injunction

Act.

The principal purpose of the Anti-Injunction Act

is “the protection of the Government’s need to assess

and collect taxes as expeditiously as possible with a

minimum of preenforcement judicial interference,

‘and to require that the legal right to the disputed

sums be determined in a suit for refund.’” Bob Jones

Univ. v. Simon, 416 U.S. 725, 736-37 (1974) (quoting

Enochs v. Williams Packing & Navigation Co., 370

U.S. 1, 7 (1962)). But, as the D.C. Circuit has explained,

the Act does not bar any and all lawsuits that might

ultimately impact the amount of revenue in the U.S.

treasury. See Cohen, 650 F.3d at 726 (citing Hibbs v.

Winn, 542 U.S. 88, 102 (2004)). Although “[t]he IRS

envisions a world in which no challenge to its actions

is ever outside the closed loop of its taxing authority[,]”

the Act’s prohibition does not sweep so broadly :

“‘assessment’ is not synonymous with the entire plan

of taxation, but rather with the trigger for levy and

collection efforts, and ‘collection’ is the actual

imposition of a tax against a plaintiff.” Id. (cleaned

App.66a

up). Accordingly, the D.C. Circuit has refused to

“read[] the [Anti-Injunction Act] to reach all disputes

tangentially related to taxes.” Id. at 726-27. Rather,

the Circuit has instructed that whether the AntiInjunction Act prohibits a suit depends on whether

the action is fundamentally a “tax collection claim,”

id. at 727 (quoting We the People Found., Inc. v. United

States, 485 F.3d 140, 143 (D.C. Cir. 2007)), which the

court must determine based upon “a careful inquiry

into the remedy sought, the statutory basis for that

remedy, and any implication the remedy may have

on assessment and collection,” id.

Cohen is illustrative. There, taxpayers challenged

a special procedure the IRS had established for

refunding an unlawfully collected tax on the ground

that the IRS had failed to comply with the Administrative Procedure Act’s notice-and-comment requirements. Id at 721. The suit thus “challeng[ed] the

adequacy of IRS procedures,” not the collection of

any tax revenue. Id. at 733. Even if the taxpayers

won, the court explained, “it does not follow that they

are entitled to a tax refund. . . . The IRS may still

adopt a new version of the same [procedure] after

fixing any substantive and procedural defects.” Id. at

728. The Anti-Injunction Act therefore presented no

bar to the action.

So, too, here. Plaintiffs do not seek a refund or to

impede revenue collection. Instead, they challenge

the IRS’s adopting of regulations without conducting

statutorily mandated reviews designed to lessen the

regulatory burden on small businesses. As relief,

they ask the court simply to compel the agencies to

do what the law requires Regulatory Flexibility Act

and Paperwork Reduction Act analyses. Tax revenues

App.67a

and their collection are unaffected by such relief. 1

The Anti-Injunction Act therefore presents no barrier

to Plaintiffs’ claims. Cf. Z Street v. Kroskinen, 791 F.3d

24, 31-32 (D.C. Cir. 2015) (holding that the AntiInjunction Act did not bar a lawsuit challenging an

allegedly unconstitutional delay in processing 501(c)(3)

applications because the injury was the delay itself).

For the foregoing reasons, Defendants’ Motion to

Dismiss is denied. So, too, is Plaintiffs’ Motion to

Expedite.

/s/ Amit P. Mehta

United States District Court Judge

Dated: December 24, 2019

1 The court need not decide at this stage whether the greater

relief Plaintiffs seek—staying enforcement of the regulations

“until such time as Defendants comply with their statutory duties,”

Am. Compl. at 19—would run afoul of the Anti-Injunction Act.

The court need address that issue only if Plaintiffs prevail on

the merits.

App.68a

PERTINENT STATUTORY PROVISIONS

OF THE RFA (5 U.S.C. § 601 ET AL.)

5 U.S.C. § 603

Initial regulatory flexibility analysis

(a) Whenever an agency is required by section

553 of this title, or any other law, to publish general notice of proposed rulemaking for any

proposed rule, or publishes a notice of proposed

rulemaking for an interpretative rule involving

the internal revenue laws of the United States,

the agency shall prepare and make available for

public comment an initial regulatory flexibility

analysis. Such analysis shall describe the impact

of the proposed rule on small entities. The initial

regulatory flexibility analysis or a summary shall

be published in the Federal Register at the time

of the publication of general notice of proposed

rulemaking for the rule. The agency shall transmit

a copy of the initial regulatory flexibility analysis to the Chief Counsel for Advocacy of the

Small Business Administration. In the case of

an interpretative rule involving the internal

revenue laws of the United States, this chapter

applies to interpretative rules published in the

Federal Register for codification in the Code of

Federal Regulations, but only to the extent that

such interpretative rules impose on small entities

a collection of information requirement.

(b) Each initial regulatory flexibility analysis

required under this section shall contain—(1) a

description of the reasons why action by the

agency is being considered; (2) a succinct statement

App.69a

of the objectives of, and legal basis for, the

proposed rule; (3) a description of and, where

feasible, an estimate of the number of small

entities to which the proposed rule will apply;

(4) a description of the projected reporting,

recordkeeping and other compliance requirements

of the proposed rule, including an estimate of

the classes of small entities which will be subject

to the requirement and the type of professional

skills necessary for preparation of the report or

record; (5) an ide ntificatio n, to the exte nt

practicable, of all relevant Federal rules which

may duplicate, overlap or conflict with the

proposed rule.

(c) Each initial regulatory flexibility analysis shall

also contain a description of any significant

alternatives to the proposed rule which accomplish

the stated objectives of applicable statutes and

which minimize any significant economic impact

of the proposed rule on small entities. Consistent

with the stated objectives of applicable statutes,

the analysis shall discuss significant alternatives

such as—(1) the establishment of differing compliance or reporting requirements or timetables

that take into account the resources available to

small entities; (2) the clarification, consolidation,

or simplification of compliance and reporting requirements under the rule for such small entities;

(3) the use of performance rather than design

standards; and (4) an exemption from coverage

of the rule, or any part thereof, for such small

entities.

App.70a

5 U.S.C. § 604

Final regulatory flexibility analysis

(a) When an agency promulgates a final rule

under section 553 of this title, after being

required by that section or any other law to

publish a general notice of proposed rulemaking,

or promulgates a final interpretative rule involving

the internal revenue laws of the United States

as described in section 603(a), the agency shall

prepare a final regulatory flexibility analysis.

Each final regulatory flexibility analysis shall

contain—(1) a statement of the need for, and

objectives of, the rule; (2) a statement of the

significant issues raised by the public comments

in response to the initial regulatory flexibility

analysis, a statement of the assessment of the

agency of such issues, and a statement of any

changes made in the proposed rule as a result of

such comments; (3) the response of the agency to

any comments filed by the Chief Counsel for

Advocacy of the Small Business Administration

in response to the proposed rule, and a detailed

statement of any change made to the proposed

rule in the final rule as a result of the comments;

(4) a description of and an estimate of the

number of small entities to which the rule will

apply or an explanation of why no such estimate

is available; (5) a description of the projected

reporting, recordkeeping and other compliance

requirements of the rule, including an estimate

of the classes of small entities which will be subject to the requirement and the type of professional skills necessary for preparation of the

report or record; (6) a description of the steps the

App.71a

agency has taken to minimize the significant

economic impact on small entities consistent

with the stated objectives of applicable statutes,

including a statement of the factual, policy, and

legal reasons for selecting the alternative adopted

in the final rule and why each one of the other

significant alternatives to the rule considered by

the agency which affect the impact on small

entities was rejected.

5 U.S.C. § 605

Avoidance of duplicative

or unnecessary analyses

(a) Any Federal agency may perform the analyses

required by sections 602, 603, and 604 of this

title in conjunction with or as a part of any other

agenda or analysis required by any other law if

such other analysis satisfies the provisions of

such sections.

(b) Sections 603 and 604 of this title shall not

apply to any proposed or final rule if the head of

the agency certifies that the rule will not, if

promulgated, have a significant economic impact

on a substantial number of small entities. If the

head of the agency makes a certification under

the preceding sentence, the agency shall publish

such certification in the Federal Register at the

time of publication of general notice of proposed

rulemaking for the rule or at the time of

publication of the final rule, along with a statement

providing the factual basis for such certification.

The agency shall provide such certification and

statement to the Chief Counsel for Advocacy of

the Small Business Administration.

App.72a

5 U.S.C. § 611

Judicial review

(a)(1) For any rule subject to this chapter, a

small entity that is adversely affected or aggrieved

by final agency action is entitled to judicial

review of agency compliance with the requirements

of sections 601, 604, 605(b), 608(b), and 610 in

accordance with chapter 7. Agency compliance

with sections 607 and 609(a) shall be judicially

reviewable in connection with judicial review of

section 604.

App.73a

MONTE SILVER MEMO ANALYZING

TREASURY REGULATORY AUTHORITY

(OCTOBER 22, 2018)

From: Monte Silver, Silver & Co.

Date: October 22, 2018

Regarding: Memo analyzing Treasury’s regulatory

authority to provide (a) relief under 965(i) to individual

U.S. Shareholders, and (b) IRC 250 deductions to

taxpayers electing under 1.962-2.

1.

Treasury has authority to grant IRC 965(e)

treatment to individual U.S. shareholders.

Being a vital engine of the American economy,

small businesses and their individual owners were

deemed a priority under the Tax Cuts and Jobs Act

(“TCJA”) and they received preferential treatment.

For example, IRC 199A provided tax breaks to individual owners of sole proprietorships and pass-through

entities.

Another priority goal of the TCJA was to create

a territorial system of taxation for U.S. corporations,

with IRC 965 serving as a transition between the old

and new regime. As part of its attempt to assist

small businesses and their individual owners (who

did not even receive the benefit of the new territorial

regime), Congress enacted IRC 965(e). IRC 965(e)

struck a balance between these two priority goals.

Much like 199A, in enacting 965(e) Congress

looked beyond the entity formalities and sought to

App.74a

assist individual owners of transparent small

businesses. Specifically, and explicitly, Congress permitted “deferral of the transition net tax liability for

shareholders of a U.S. shareholder that is a flow

through entity . . . ” Any such shareholder “may elect

to defer his portion of the net tax liability to the

participation exemption system until the shareholder’s

taxable year in which a triggering event occurs.”

Conference Report to Accompany H.R. 1, December

15, 2017. Clearly, in both laws Congress intended to

protect individual shareholders of small businesses,

and the transparent small businesses themselves.

The Proposed 965/962 Regulations (“Regs”)

It is fundamental administrative law that in

interpreting statutes and issuing regulations, the Federal agency is “given controlling weight unless they

arbitrary, capricious or manifestly contrary to the

statute.” Chevron U.S.A. v. NRDC, 467 U.S. 837 (1984).

This is especially so where the statute provides the

agency with authority to prescribe regulations necessary or appropriate to carry out the provisions of the

statute, as is the case with IRC 965. Chevron at 844.

Unless the law is unambiguously expressed as to

the issue at hand, the administrative agency is required

to make rules and fill gaps left implicitly or expressly

open by Congress. Morton v. Ruiz, 415 U.S. 1999

(1974).

Given the scope of TCJA and the somewhat rapid

manner in which parts of it may have been drafted,

certain problems and ambiguities arose. In addressing

them, and absent acting arbitrarily, Treasury has

full legitimacy to use its discretion to solve these

problems, under Chevron and under IRC 965(o).

App.75a

And in the case of the Regs, Treasury has applied

it discretion. For example, IRC 962 specifically allows

962 elections to be made only by U.S. Shareholders

who are individuals. However, in the Regs, Treasury

expanded the definition to include pass-through entities

such as domestic partnerships, corporations, trusts

and estates. Putting economic reality before form,

Treasury equated individuals with a wide variety of

pass-throughs to avoid a severe impact on small

businesses.

And with the issue at hand, the need for a

solution is more compelling than Chevron and 962

elections. First, in Chevron and all other such cases

before courts, the factual record before the Federal

agency is rich and has been fully analyzed by expert

opinions and otherwise (see Southern Offshore Fishing

Association v. Daley ; North Carolina Fisheries

Association v. Daley, California Cattlemen vs. U.S. Fish

& Wildlife). Here, very little was known to Congress

or is known to Treasury about the impact 965/962/951A

has on small businesses. Thus, extra caution is

warranted. Second, the small businesses owned directly

by individual U.S. shareholders tend to be much

smaller than those run tho ugh small business

corporations. Third, small businesses inherently lack

the ability to unite and obtain effective advocacy

assistance.

In summary, the clear intent of TCJA was to assist

small businesses and their owners, as seen in IRC

199A and 965(e). While IRC 199A confers a benefit,

IRC 965 imposes a draconian cost on small businesses. Given the extreme fact pattern in our case,

Treasury has unquestionable lawful discretion to

address the problem. In the proposed 1.962-2, Treasury

App.76a

did so, looking at economic reality and substance

over entity formalities. Accordingly, Treasury has

similar authority to grant IRC 965(e) treatment to

individual U.S. shareholders.

2.

Treasury has authority to allow IR 250

deductions to taxpayers electing under

1.962-2

For all the reasons get forth above, and for those

set forth below, the proposed regulations under 1.9622 should allow the electing taxpayer to enjoy the

deductions under IRC 250.

GILTI is a tremendously complex tax. Unlike

the Transition tax, GILTI is annual, imposing on U.S.

Shareholders of small businesses a very painful ongoing burden. To make matters worse, unlike Google,

Apple and other huge corporations, all U.S. Shareholders making the 962 election are not entitled to

the benefits of IRC 250 as they are not U.S. corporations. This is clear, and has recently been reinforced

by the U.S. tax court in Smith vs. IRC. 151 T.C. 5

(2018).

In Smith, the taxpayer made the IRC 962

election and sought to enjoy various benefits as a

domestic corporation. The tax court ruled against the

taxpayer saying that the IRC 962 “provisions do not

create hypothetical corporations . . . They simply provide a mechanism that enables an individual U.S.

taxpayer to elect what he or she may deem more

desirable tax treatment.” Smith at 21. “There is

nothing in the statutory text to suggest that Congress

intended [IRC 962] to apply for any other purposes

under the Code, least of all for purposes of section

1(h)(11), which was not enacted until 41 years later.”

App.77a

In our case, there is significant justification to

allow the 962 taxpayer to benefit from IRC 250. First,

IRC 250 was enacted in 2017, decades after IRC 962

became law. Congress could not have foreseen IRC

250.

Second, IRC 951A(f)(1)(A) specifically states that:

“any global intangible low-taxed income

included in gross income shall be treated in

the same manner as an amount included

under section 951(a)(1)(A) for purposes of

applying sections . . . 962.”

Moreover, 951A(a)(1)(B) gives Treasury complete

authority to provide relief.

“The Secretary shall provide rules for the

application of subparagraph (A) to other

provisions of this title in any case in which

the determination of subpart F income is

required to be made at the level of the controlled foreign corporation.”

In the case o f IRC 95lA, GILTI income is

determined at the CFC level, with the amount

includable as GILTI income.

Given (1) the clear intent of Congress to promote

small businesses, (ii) the overwhelming impact GILTI

will have on small businesses on an annual basis,

(iii) the fact that small businesses receive worse

treatment than do massive corporations, and (iv) the

clear language of the statute granting Treasury with

authority, Treasury has complete authority to allow

taxpayers electing under IRC 962 to enjoy the benefits

of IRC 250.

App.78a

EMAIL CORRESPONDENCE BETWEEN

MONTE SILVER AND TREASURY

(JUNE 4, 2018)

ANNEX 1

June 4, 2018 with Respondent senior officials

confirming that Secretary of Treasury signed relief

for small businesses

From: LafayetteChip.Harter@treasury.gov

[Deputy Treasury secretary for international

tax, and in charge of Guidance]

Sent:

Monday, June 4, 2018 17:16

Subject:RE: Status of signature by Secretary Mnuchin

on fix for expats

The Secretary signed off this morning. It will be

coming out today. Log onto the IRS website in a couple

of hours.

Chip

From: Monte@Silver Law

Sent:

Monday, June 4, 2018 1:14 AM

To:

Harter, Chip

<LafayetteChip.Harter@treasury.gov>

Cc:

Kautter, David

<David.Kautter@treasury.gov>

[Assistant Secretary of the United States

Treasury for Tax Policy]

Subject:RE: Status of signature by Secretary Mnuchin

on fix for expats

App.79a

Hi Chip

Its Monday now. I understand that the Secretary

was in Canada and has other things on his agenda.

But for almost a million Americans abroad—

including those with CFC interests and their family

members—-we are getting very close to the wire.

You and your team side have tons of work into

this. Now lets bring things to a close. I ask a full court

press be implemented to may sure it is signed today.

I will be doing the same on my end.

Thx Monte

App.80a

CERTIFICATION IN PROPOSED GUIDANCE

For a discussion of the one-time annual reporting

burden associated with the statute see the Paperwork

Reduction Act (PRA) section of this preamble, which

provides further detail regarding the assumptions

underlying these estimates. These estimates are that

100,000 respondents will require 5 hours per response

for a total reporting burden of 500,000 hours. A valuation of the burden hours at $95/hour leads to a PRAbased estimate of the reporting costs to taxpayers of

$47,500,000. This is a one-time paperwork burden

associated with a one-time tax, and Treasury anticipates all paperwork burdens to be incurred within

the next year. Any subsequent reporting (such as over

the eight-year payment period) would be nominal

burdens that implement payments calculated in the

initial year. This estimate does not disaggregate the

cost specifically due to the proposed regulations. The

Treasury Department solicits comments on the assumptions and appropriateness of the methodology

used to calculate the compliance costs imposed by the

proposed regulations relative to the baseline.

II. Executive Order 13771

This proposed rule is expected to be an Executive

Order 13771 regulatory action. Details on the estimated

costs of this proposed rule can be found in the rule’s

economic analysis.

III. Regulatory Flexibility Analysis

The Regulatory Flexibility Act (5 U.S.C. chapter 6)

does not apply because the regulations do not impose

a collection of information on small entities. Any

App.81a

burden on small entities in these regulations stems

from the collection of information requirements in proposed §§ 1.965-2(d)(2)(ii)(B), 1.965-2(f)(2)(iii)(B), 1.9653(b)(2), 1.965-3(c)(3), 1.965-4(b)(2)(i), 1.965-7(b)(2),

1.965-7(b)(3)(iii)(B), 1.965-7(c)(2), 1.965-7(c)(3)(iv)(B),

1.965-7(c)(3)(v)(D), 1.965-7(c)(6)(i), 1.965-7(d)(3), 1.9657(e)(2), 1.965-7(f)(5), and 1.965-B(c). It is hereby certified that these collection of information requirements

will not have a significant economic impact on a

substantial number of small entities. Accordingly,

an initial regulatory flexibility analysis is not required.

This certification is based on several facts. First,

the average burden is five hours, which is minimal,

particularly in comparison to other regulatory requirements related to owning stock in a specified foreign

corporation. Second, the requirements apply only if a

taxpayer chooses to make an election or rely on a

favorable rule. Third, the collections of information

apply to the owners of specified foreign corporations.

Because it takes significant resources and investment

for a foreign business to be operated in corporate form

by a United States person, specified foreign corporations will infrequently be small entities. Moreover,

because the collection of information requirements

apply to the owners of specified foreign corporations

rather than the specified foreign corporations themselves, a specified foreign corporation that was a

small entity would not be subject to the collections of

information. Fourth, the collection of information

requirements in this regulation apply primarily to

persons that are United States shareholders of

specified foreign corporations. The ownership of

sufficient stock in specified foreign corporations in order

to constitute a United States shareholder generally

entails significant resources and investment, such

App.82a

that businesses that are United States shareholders

are generally not small businesses. Pursuant to

section 7805(f), this notice of proposed rule making

has been submitted to the Chief Counsel for Advocacy

of the Small Business Administration for comment

on its impact on small business.

App.83a

CERTIFICATION IN FINAL GUIDANCE

Form

Type of

Filer

OMB

Number

Status

all forms in

3/2019. 60 Day

FRN not

published yet for

full collection.

Link: https://www.reginfo.gov/public/do/

PRAViewICR?ref_nbr=201808-1545-031

Forms

990-PF

Tax

Exempt

entities

(NEW

Model)

1545-0047

Published 60-day

FRN on 8/22/18.

Link: https://www.federalregister.gov/

documents/2018/08/22/2018-18135/

proposed-collection-comment-reguest-forforms-990-990-ez-sch-br-br-990-ez-sch-l-lp990-ez-990-of

Form

1040

Individual

(NEW

Model)

1545-0074

Limited

Scope

submission

(1040 only)

approved on

12/7/18. Full

ICR

submission

App.84a

for all forms

in 3/2019. 60

Day FRN not

published vet

for full

collection.

Link: https://www.reginfo.gov/public/do/

PRAViewICR?ref_nbr=201808-1545-031

Form

1041

Trusts and 1545-0092

estates

Submitted to

OIRA for

review on

9/27/18.

Link: https://www.reginfo.gov/public/do/

PRAViewICR?ref_nbr=201806-1545-014

Form

1065

Business

(NEW

Model)

1545-0123

Published in

the FRN on

10/11/18.

Public

Comment

period closed

on 12/10/18.

Link: https://www.federalregister.gov/

documents/2018/10/09/2018-21846/

proposed-collection-comment-reguest-forforms-1065-1065-b-1066-1120-1120-c-1120f-1120-h-1120-nd

Forms

1120,

1120-C,

1120-L,

Business

(NEW

Model)

1545-0123

Published in

the FRN on

10/11/18.

Public

App.85a

1120PC,

1120REIT,

1120RIC,

1120-S

Comment

period closed

on 12/10/18.

Link: https://www.federalregister.gov/

documents/2018/10/09/2018-21846/

proposed-collection-comment-request-forforms-1065-1065-b-1066-1120-1120-c-1120f-1120-h-1120-nd

III. Regulatory Flexibility Act

Pursuant to the Regulatory Flexibility Act (5

U.S.C. chapter 6), it is hereby certified that the final

regulations will not have a significant economic impact

on a substantial number of small entities within the

meaning of section 601 (6) of the Regulatory Flexibility

Act (“small entities”).

Section 965 and the final regulations generally

affect U.S. taxpayers who are at least 10-percent

shareholders of a foreign corporation. As an initial

matter, foreign corporations are not considered small

entities. Nor are U.S. taxpayers considered small

entities to the extent the taxpayers are natural persons

or entities other than small entities. Although the

Treasury Department and the IRS received a number

of comments asserting that a substantial number of

small entities would be affected by the proposed regulations, those comments were principally concerned

with U.S. citizens living abroad that owned foreign

App.86a

corporations directly or indirectly through other

foreign entities. No small entity is affected in this

scenario. Thus, the final regulations generally only

affect small entities if a U.S. taxpayer that is a 10percent shareholder of a foreign corporation is a

small entity.

While comprehensive counts of all types of small

businesses affected by section 965 and these regulations

are not readily available, in-house estimates of section

965 suggest that very roughly 20,000 multinational

domestic corporations are potentially subject to section

965, and that about half of these corporations have

less than $25 million in gross receipts. Therefore,

very roughly 10,000 small multinational corporations

(defined as corporations with less than $25 million in

gross receipts) are potentially subject to section 965.

The in-house estimates further suggest that about

25% of these small multinational corporations would

not owe any tax under section 965, because they do

not have any accumulated E&P to which the tax

would be applied.

Regardless of the number of small entities

potentially affected by section 965 or the final

regulations, the Treasury Department and the IRS

have concluded that there is no significant economic

impact on such entities as a result of the final

regulations. Based on published information from the

Conference Report accompanying the Act, H.R. Rep.

No. 115-446, at 688 (2017), and Bureau of Economic

Analysis aggregate data, which were adjusted to reflect

the tax burden and total sales of small businesses,

the projected net tax proceeds from section 965 are

estimated to be only a small fraction of the total sales

of small U.S. parented multinational enterprises pro-

App.87a

jected to 2027. 1 See the table in this Part III. The tax

amounts to less than 3 to 5 percent of receipts (as

defined in 13 CFR 121.04), an economic impact that

is not regarded as significant under the Regulatory

Flexibility Act. Moreover, while most affected small

entities are likely to pay the tax in (unequal) installments over 8 years, the percentage in any particular

year does not exceed 2.2 percent.

Net Section 965 Tax Revenue as a Fraction of Total

Sales for Small Multinational Businesses1

Fiscal

Years

Net Tax

Collected

($ billions)

Total Sales

($ billions)

Percent

2018

1.2

54.0

2.20%

2019

0.8

56.7

1.32%

2020

0.2

59.6

0.42%

2021

0.2

62.6

0.38%

2022

0.2

65.7

0.36%

2023

0.4

69.0

0.60%

2024

0.7

72.4%

0.99%

2025

1.0

76.0

1.28%

1 In-house estimates of section 965 tax liability and total receipts

of small businesses are used to scale the published aggregate

figures. In this case, a small business is defined as a multinational

corporation with less than $25 million in gross receipts. Data on

total sales of all U.S. parented companies are drawn from the

Bureau of Economic Analysis Interactive Data accessed at this web

address in December, 2018: https://apps.bea.gov/iTable/iTable.

cfm?ReqID=2&step=1.

App.88a

2026

0.5

79.8%

0.63%

2027

0.1

83.8

0.17%

Small Multinational Businesses are not necessarily small entities as defined by the Regulatory

Flexibility Act.

Thus, even if the economic impact of the final

regulations is interpreted broadly to include the tax

liability due under section 965, which small entities

would be required to pay even if the final regulations

were not issued, the economic impact should not be

regarded as significant under the Regulatory Flexibility

Act.

Additionally, the economic impact of the final

regulations when considered alone should be minimal.

Any economic impact of the final regulations stems

from the collection of information requirements imposed

by §§ 1.965-2(d)(2)(ii)(B), 1.965-2(f)(2)(iii)(B), 1.965-3

(b)(2), 1.965-3(c)(3), 1.965-4(b)(2)(i), 1.965-4(b)(2)(iii) (B),

1.965-7(b)(2), 1.965-7(b)(3)(iii)(B), 1.965-7(c)(2), 1.9657(c)(3)(iv)(B), 1.965-7(c)(3)(v)(D), 1.965-7(c)(6) (i), 1.9657(d)(3), 1.965-7(e)(2), 1.965-7(f)(5), and 1.965-B(c). The

Treasury Department and the IRS have determined

that the average burden associated with these collection

of information requirements is 5 hours, which is minimal, particularly in comparison with other regulatory

requirements related to owning stock in a specified

foreign corporation. Furthermore, these requirements

apply only if a taxpayer chooses to make an election

or rely on a favorable rule. The comments received

regarding the economic impact of the proposed regulations principally focus on burdens imposed by the

statute (i.e., the tax due as a result of section 965)

App.89a

rather than any additional burdens resulting from

the proposed regulations.

For the reasons explained above, the Treasury

Department and the IRS have determined that the

final regulations will not have a significant economic

impact on a substantial number of small entities.

Accordingly, a regulatory flexibility analysis under

the Regulatory Flexibility Act is not required. Pursuant

to section 7805(f), the notice of proposed rulemaking

preceding these final regulations was submitted to

the Chief Counsel for Advocacy of the Small Business

Administration for comment on its impact on small

business. No comments were received.

IV. Unfunded Mandates Reform Act

[...]

App.90a

GAO REPORT:

TREASURY AND OMB NEED TO

REEVALUATE LONG-STANDING

EXEMPTIONS OF TAX GUIDANCE

UNITED STATES GOVERNMENT

ACCOUNTABILITY OFFICE

REPORT TO CONGRESSIONAL R EQUESTERS

________________________

TREASURY AND OMB NEED

TO REEVALUATE LONG-STANDING

EXEMPTIONS OF TAX REGULATIONS

AND GUIDANCE

. . . generally include a one-sentence statement that

APA notice and comment requirements are not

applicable.52 Between 2013 and 2015, we found that

nearly 90 percent of the proposed, temporary, and

final regulations issued during this period included

this statement. Although IRS and Treasury have

determined that the notice and comment requirements

52 In 2015, the U.S. Tax Court invalidated tax regulations

regarding cost-sharing agreements among related companies on

the basis that the regulations were procedurally deficient under

APA because IRS failed to consider empirical data before the

agency. Although not directly at issue in the case, the Tax Court

decision stated that the regulation at issue was legislative

rather than interpretative. See Altera Corp. vs. Commissioner,

145 T.C. No. 3 (2015). In February 2016, IRS appealed the Tax

Court’s decision to the Ninth Circuit, and the matter was still

pending as of June 2016.

App.91a

frequently do not apply, Treasury and IRS officials

told us they follow notice and comment requirements

for nearly all proposed and final tax regulations. Our

analysis of tax regulations issued between 2013 and

2015 confirmed this. An IRC provision also requires

IRS to solicit public comments whenever it issues

temporary regulations.53 The practice of asking for

public comment after issuing a rule is known as postpromulgation notice and comment. As we reported in

2012, agencies may solicit comments at the same

time as publishing a temporary or final rule, but

then the public does not have an opportunity to

comment before the rule goes into effect.54

Impact on Small Entities

We found that Treasury and IRS rarely perform

a regulatory flexibility analysis assessing a regulation’s

impact on small businesses and other small entities

as generally required by the Regulatory Flexibility

Act (RFA). In our review of over 200 tax regulations

issued from 2013 to 2015, only two regulations’

preambles included a regulatory flexibility analysis.

53 See 26 U.S.C. § 7805(e), which requires that any temporary

regulations must also be published as a notice of proposed

rulemaking (NPRM), thereby providing the public an opportunity

to comment on the rule, and that any temporary regulations

will sunset after 3 years.

54 In 2012, we reported that agencies did not publish an NPRM

soliciting public comment for about 35 percent of major rules

and 44 percent of nonmajor rules published from 2003 to 2010.

For major rules that had been issued without an NPRM, we found

that agencies often solicited public comments upon publication

of the final rule. See GAO, Federal Rulemaking: Agencies Could

Take Additional Steps to Respond to Public Comments, GAO13-21 (Washington, D.C.: Dec. 20, 2012).

App.92a

In about half of the regulations issued, Treasury and

IRS stated in the regulations’ preambles that RFA’s

requirements for a regulatory impact analysis did

not apply because the regulation does not impose

collection of information requirement on small

entities.55 For the other half of regulations in our

review that did not include a regulatory flexibility

analysis, the preamble text stated that the regulation

will not have a significant economic impact on a

substantial number of small entities. The CCDM

states that a statute or other legal authority may

have an impact on small entities, but a regulatory

flexibility analysis is not required if the effect flows

directly from the underlying statute or authority, not

the regulation implementing it.

We found a few examples of rules where Treasury

and IRS stated that they received public comments

disagreeing with their determination that RFA did

not apply and therefore a regulatory flexibility analysis

was not required. In one example, an association of

accountants disagreed with a determination that a

proposed rule would not have a significant economic

impact on a substantial number of small entities.56

In the final regulation’s preamble, Treasury and IRS

55 Congress amended the RFA in 1996 to make it applicable to

interpretative rules involving internal revenue laws, but only to

the extent that those tax regulations imposed a collection of

information requirement on small entities.

56 Institute of Management Accountants, letter addressed to

the IRS, “Re: Proposed Regulations under Section 9015 of the

Patient Protection and Affordable Care Act,” Mar. 5, 2013,

available via http://www.regulations.gov. The letter also disagreed

with the determination that the regulatory action was not

economically significant under Exec. Order No. 12866.

App.93a

addressed those comments by stating that any economic

impact was principally the result of the underlying

statute, not the regulation.57 In another example,

Treasury and IRS acknowledged that the Small

Business Administration (SBA) disagreed with their

determination that the rule did not impose a collection

of information requirement on small entities.58 Under

an IRC provision, IRS is required to solicit comments

from the SBA on a proposed or temporary rule’s impact

on small businesses, and consider those comments

before issuing a final rule.59

57 See T.D. 9645, Rules Relating to Additional Medicare Tax,

IRB 2013-51, Dec. 16, 2013.

58 See T. D. 9655, Shared Responsibility for Employers Regarding

Health Coverage, IRB 2014-9, Feb. 24, 2014.

59 See 26 U.S.C. § 7805(f).

App.94a

REPORT OF DEMOCRATS ABROAD:

TAX FILING FROM ABROAD RESEARCH ON

NON-RESIDENT AMERICANS AND U.S.

TAXATION MARCH 2019

The majority of us aren’t making millions or

trying to hide our money in secret Swiss

bank accounts. We just want to live simple,

ordinary lives. The amount of stress that

comes along with the U.S. tax system is

overwhelming. It is extremely complicated

and expensive to navigate. We live with a

real burden that Americans living in the

U.S. simply don’t understand. - Michigan

voter living in the UK

DEMOCRATS ABROAD

200 South Capitol Street SE

Washington, DC 20003

Tel: 1-202-621-2085

TaxationTF@democratsabroad.org

Democratsabroad.org/taxation

3.1 THE 2017 Tax Cuts and Jobs Act (TCJA)

The 2017 tax writing process exceeded all previous

experience in ultra-fast and ill-considered lawmaking.

App.95a

The law includes two new taxes to transition the U.S.

to a system of territorial taxation for corporations.

The provisions have an exceedingly favorable impact

on U.S. corporations that own foreign registered

companies. They are having a grave impact, however,

on Americans abroad who are majority shareholders

in companies registered abroad, such as family-run

businesses, who were clearly not considered during

policy-making. They are now subjected to 1.

Repatriation Tax, forcing them to declare on

their personal U.S. tax filing all unrecognized

profits generated by the business from 1986

to 2017, and

2.

Global Intangible Low Tax Income Tax,

forcing them to declare on their personal

U.S. tax filing the profits of the business,

declared or undeclared, to be taxed at 10.5%

with no credit available for taxes already

paid to the tax authority where the business

is registered.

Because of these two new taxes many Americans

abroad who own companies are finding those businesses

may no longer be viable and they will be forced to

close them or incur the cost to restructure them.

From questions related to employment, the

research indicates that these new taxes impact ca

1.9% of respondents, i.e. those who responded to a

question about employment by indicating that they

are “employed by a company of which I am a majority

shareholder”.(See Appendix.)

Extrapolating this to the estimated 6.5 million

American adults living abroad suggests up to 130,000

App.96a

individuals could be impacted as owners of companies

registered abroad.

All research participants were asked about

whether they would be impacted by the “transition

taxes” in the TOA and responded as follows:

Impacted by the Transition Taxes in the

2017TaxCuts and Jobs Act N=9,735

These results suggest that the impact of the

TOA extends beyond the individual taxpayer who is

majority owner of the foreign registered company,

perhaps to their spouse.

App.97a

LETTER FROM DEMOCRATS ABROAD

TO SENATOR HATCH ET AL.

(APRIL 20, 2018)

Senator Orrin Hatch, Chairman

Senator Ron Wyden, Ranking Member

Senate Committee on Finance

Attn. Editorial and Document Section

Rm. SD-219, Dirksen Senate Office Building

Washington, DC 20510-6200

Dear Chairman Hatch, Ranking Member Wyden,

and all Members of the Committee,

Re: Senate Finance Committee Hearing to examine

Early Impressions of the New Tax Law Tuesday,

April 24, 2018

Democrats Abroad greatly appreciates this

important hearing on the early impressions of the

Tax Cuts and Jobs Act (P.L. 115-97) and we respectfully

request that you accept this report for inclusion in

the hearing record. We join other organizations

representing Americans living abroad in our serious

concern about the impact that new taxes in the Tax

Cuts and Jobs Act will have on non-resident Americans

who own businesses abroad.

App.98a

In 2017 the U.S. Congress included Territorial

Taxation for Corporations (TTC) in the group of

reforms built into the Tax Cuts and Jobs Act (TCJA).

We understand that TTC was implemented in order

to help level the international tax playing field for

U.S. multinational corporations. Congress also included

in the TCJA two new “transition tax” provisions to

capture tax on corporate profits long kept out of

reach of the U.S. Treasury. These new “transition

taxes” are our key concern because they materially

threaten the viability of businesses owned by Americans

living abroad.

The TCJA “Transition Taxes”

15.5% Repatriation Tax—imposed on undistributed (and therefore untaxed by the U.S.) business

profits from 1986 through 2017. Overseas resident

American business owners declare those undistributed

business profits on their 2017 personal tax filing.

This is a retroactive imposition of tax that is unrelated

to the realization of revenue that might be used to

pay the tax.

GILTI Tax regime—starting in 2018, mandatory

declaration of undistributed business profits on the

personal tax filings of business owners abroad, taxed

at the highest personal marginal tax rate and without

access to two critical offsets afforded corporate owners

of businesses abroad: 1) a 50% deduction and 2) credits

for taxes already paid on the profits to the business’s

jurisdiction of incorporation. Further, as with the

Repatriation Tax, the GIL Tl tax is imposed on profits

where there may be no realization of revenue to use

to pay the tax.

App.99a

Clearly, TTC was enacted to strengthen U.S.

multinational corporations. We be lieve TTC’s

“transition tax” provisions were never meant to

beleaguer ordinary, hard-working Americans living

and ow ning companies abro ad. In truth, the

Repatriation Tax and the GILTI Tax regime will

have an enormously harmful financial impact on the

estimated 1 million non-resident Americans who own

businesses abroad. 1

Transaction Tax Impacts on Non-Resident

Americans Who Own Businesses Abroad

Americans living abroad owning and operating

businesses are an exceeding diverse group; they are

architects, yoga studio owners, retailers, recruiters,

beekeepers, IT professionals, film and television

producers, music distributors, advertising agency

owners, financial service providers and more.2 When

asked in early 2018 about the impact of the TCJA

“transition taxes” on their enterprises expat American

owners of businesses in their countries of residence

provided the following comments:

My family and I own a small private

property development company based in the

UK and operating since 2001. The profits of

this company are fully taxed in the UK and

none of the proceeds have been repatriated

1 2014 research published by Democrats Abroad approximately

20% of respondents identified themselves as “Selfemployed/

Business Owner.” Given Department of State estimates that 6.5

million voting age Americans live abroad, we estimate that perhaps

a million American citizens are impacted by the “transition

taxes” in the Tax Cuts and Jobs Act.

2 See Appendix 1-Sampling of businesses run by Americans abroad.

App.100a

to the US as they are used for the continuing

financing of the business.

Massachusetts voter living in the UK

I am a widow, mother of 2 children (ages 16

and 22). My husband was a Canadian glass

artist he did not have a pension. I am and

have been a self employed graphic designer

for many ye ars. I have no pension. My

corporation is just me. It holds my savings

which are now being taken away by this

tax.

Wisconsin voter living in Canada

I operate my company with just myself and

my spouse and make minimal profit ($20,000

PA at the most after all UK taxes have been

paid) and most recently a loss, none the less

I file my US taxes at a cost of $1000 each

time and now I find I might be hit with an

extra US tax making my company potentially

nonviable.

American living in the UK

I run a technology company from Hong

Kong with offices in three territories (China,

HK and Taiwan). We have 10 employees

and are an exceedingly small company who

struggle every day to meet bills and grow

our company. But we have big dreams and

want to succeed. Don’t snuff out small

business owners like myself. We are the past,

present and future of American business

both at home and abroad.

New Jersey voter living in Hong Kong

App.101a

As an architect, I established my small

office of 6 employees as a Professional Corporation. This means that the US government

is attempting to take a percentage of my

savings, which will be needed to weather

downturns in the market, which greatly

affects my ability to retain employees and

keep my business open. I have no home

office in the US, nor is there any way for me

to benefit from the large corporation tax

breaks. This is simply the US siphoning

away the funds I need to keep my business

up and running.

Massachusetts voter living in Canada

I have been in Canada for several decades,

except for 1997-2001 when my wife and I

lived and worked in the U.S. For the past 11

years I have been doing IT consulting for

the Canadian government, which required

having a corporation. I have built up savings

within the corporation which are meant for

my retirement, and it operates solely within

Canada, i.e. not a branch operation of any

U.S. company. It was a shock to learn from

my accountant that I am facing a tax of

about $12,000 on my retained earnings, as a

result of the subject legislation.

North Carolina voter living in Canada

My family business is a simple IT training

and consulting corporation that employs me

and my husband only. We file and pay taxes

in Australia and the US as required. This

new tax can ruin us, and if we were simply

App.102a

living in the US, would not apply to us. This

is unfair.

California voter living in Australia

I have a little landscaping business with 5

employees. I am very proud of the work we

do, but keeping on top of all of the paperwork

is a struggle for me. I am happy to pay my

fair share of taxes, but this law is not fair.

California voter living in Canada

My business is a one person marketing

consulting corporation in which I maintain

a simple portfolio to save for my retirement.

This is a travesty.

Vermont voter living in Canada

I am a VERY small business owner, running

a private counselling practice out of my

home. I am very worried that the new laws

will be punitive. I already have to pay a tax

accountant more than $600 CON each year

for preparing my US tax returns yearly. My

fear is that the increased complexity will

not only raise the amount I need to pay

them, but will result in my needing to pay

taxes twice on the same money.

Massachusetts voter living in Canada

My business, REDACTED, is a values based

business with a focus on sustainability. We

make the best REDACTED in Vancouver,

BC and strive to be the best employer in our

industry. The livelihood of my family and

App.103a

the 100 staff that REDACTED employs is in

danger from this policy mistake.

Washington state voter living in Canada

I am a small business person with a trading

company and some small service businesses.

I declare my businesses and income and pay

the taxes due both locally and to the US

Treasury. Although I have lived overseas for

over 40 years, I am proud to be an American

and to support the government with my tax

dollars. But this latest abomination of a

regime is putting an unbearable burden on

me and countless other Americans for little

tangible benefit. We’re the small worthless

fish being swooped up by a giant drift net

meant to catch the larger valuable prey,

and we’re being left to suffocate and die for

lack of interest. Please help us.

Wisconsin voter living in Taiwan

I am a practicing physician. I am shareholder

in our small incorporated family owned

medical business. This Canadian only

corporation serves only local people, and the

income from this stays in Canada and is

effectively our only pension. The Repatriation/

GILT is unfair taxation! We have diligently

and without fail filed our US Tax returns all

the years that we have been required to do so

in addition the Treasury Department forms

at excess cost to us.

California voter living in Canada

App.104a

I run a one-person incorporated consulting

business. I have worked part-time for the

past nine years, with the specific purpose of

putting. money aside to send my two

daughters to college in the US. Any additional

penalizing taxes paid out of my corporation

will be a direct hit to the tuition funds I

have worked hard to save, and result in a

higher need for federal financial aid.

Illinois voter living in Canada

I am the owner of a small software development business that has never done any

business in the U.S., yet still reports to the

U.S. IRS, and will continue to do so as long

as deemed that the cost is within reason.

My options are simply to shut it down or

expatriate.

California voter living in Sweden

All of these comments, and several more not

listed here, demonstrate that many Americans business

owners living abroad fear that this additional tax

burden will force them to close their businesses. 3 In

addition to the new transition tax burden American

business owners abroad will bear, they are also being

subjected to even greater tax filing/compliance costs.

The new rules for calculating the “transition taxes”

are exceedingly technical and organizing accurate

filings is proving very time-consuming and complex.

U.S. expat tax professionals hired to prepare these

3 Appendix 2 contains comments from Americans living abroad

who had planned to start businesses in their countries of residence

but who may cancel those plans because of the Transition Taxes.

App.105a

filings are passing on to American business owners

abroad the additional cost of their time and labor,

enlarging the financial burden the new TOA taxes

places on the taxpayer.

Further, while U.S. corporations establish

subsidiary businesses abroad in order to expand the

operations and profitability of their U.S.-based parent

company, U.S. citizens abroad establish businesses

in their countries of residence in order to build a life

and future abroad.

These are desperate cries from your constituents

for help.

I set up my business only in June last year

(2017) as a stop-gap to enable me to earn

consulting fees during a period of unemployment following involuntary redundancy. I

am earning a fraction of what I earned

when employed (about 75% less), yet I am

now faced with the cost of employing a tax

preparer to deal with the complexity of

earning my small income through a UK

limited company that I own rather than

through a UK company owned by someone

else. On 2017 income of about US$15,000, I

expect a bill from a tax preparer in excess of

US$2,000, more than 10% of my total income,

only to comply with the filing burden placed

on me as UK business owner who happens

to possess a US passport. I can’t even

estimate what the cost will be if any US

taxes are owed.

I have lived outside the United States for

nearly 25 years and have filed my tax returns

App.106a

and FinCen and FATCA forms without the

assistance of a tax preparer for the last 15

years. Now, at a time when I am on significantly reduced income, I am being penalized

for being a US citizen earning money the

wrong way.

Virginia voter living in the UK

As a simple freelance consultant to the life

sciences industry, I only established a British

limited company on the request of my

corporate clients to ensure compliance with

local employment regulations and law. I have

no employees and no teams of accountants

and finance advisors. Between the transition

tax and the small fortune I will spend on

tax accountants, my financial position will

suffer detrimental damage—not only will I

suffer a significant income loss, the reduced

income will severely impact my likelihood of

being able to re-mortgage my home and

potentially force me and my wife to sell our

home at a loss. I have been fully compliant

with US tax and reporting laws for the 10

years of living overseas—this law however

has the potential to financially destroy

millions of Americans like myself in a

matter of months.

I beg you, PLEASE PLEASE PLEASE

PLEASE PLEASE PLEASE remove innocent

overseas US business owners from this

broad net of unintended taxation. I believe

it was not intended to financially destroy

people like me, but it is has the potential to

do exactly that.

App.107a

Arizona voter living in the UK

We believe strongly that a remedy is needed

to exempt these taxpayers from a potentially

crushing new tax liability - one that Congress

never intended.

Transaction Tax Remedy

We believe Americans overseas with interests in

foreign corporations should be exempt from the

Repatriation Tax and from the GILTI Tax regime for

any given year so long as:

(1) they meet the conditions required for

exemption under IRC Section 911, and

(2) they are individual U.S. Shareholders.

This solution both achieves the U.S. Congress’s

goal of capturing corporate tax it has been longdenied, and recognizes that the profits of businesses

owned by Americans living abroad were never meant

to be repatriated to the U.S. because they are needed

to sustain the underlying business entities and the

American expatriate families who rely upon them.

We strongly urge Congress to correct this

unintended tax burden which harms Americans and

their opportunities for personal savings and economic

growth. American business owners abroad should be

exempted from these transition taxes so they can

remain positioned to manage and grow their businesses

and take care of their families.

We thank you for considering our views. If you

have any questions regarding this letter or would

like to discuss the matter further, please do not

hesitate to contact either me or Democrats Abroad’s

App.108a

Carmelan Polee who can be reached at Carmelan@

democratsabroad.org.

Sincerely,

Julia Bryan

International Chair

Democrats Abroad

chair@democratsabroad.org

Democrats Abroad is the branch of the U.S.

Democratic Party for Americans living outside the

U.S. Democrats Abroad has members in over 190

countries and official country committees in 53 nations

on six continents. Democrats Abroad’s main activity

is helping overseas Americans register to vote in U.S.

elections. We host our own voter assistance website to

aid Americans in that process—www.votefromabroad.

org. We often cooperate with U.S. Embassies and

Consulates in our countries to encourage voter

participation on a non-partisan basis. You can find out

more information about us at www.democratsabroad.

org or on our Democrats Abroad and Democrats

Abroad country committee Facebook pages.

App.109a

MEMORANDUM OF LAW OF THE RO AMICI

CURIAE IN SUPPORT OF THE PLAINTIFFS’

MOTION FOR SUMMARY JUDGMENT

(JUNE 9, 2020)

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

________________________

MONTE SILVER, ET

This text is long and has been trimmed here. Open the source document for the complete record.