14‐3428 Humboldt Shelby Holding Corporation, And Subsidiaries v. Commissioner of Internal Revenue

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 3rd day of June, two thousand fifteen.

PRESENT: RICHARD C. WESLEY, PETER W. HALL, RAYMOND J. LOHIER, JR., Circuit Judges. ______________________

HUMBOLDT SHELBY HOLDING CORPORATION AND SUBSIDIARIES,

Petitioner‐Appellant,

‐v.‐ No. 14‐3428

COMMISSIONER OF INTERNAL REVENUE,

Respondent‐Appellee. ______________________

1 FOR APPELLANT: JASPER G. TAYLOR III (Richard L. Hunn, on the brief), Norton Rose Fulbright US LLP, Houston, TX.

FOR APPELLEE: JUDITH A. HAGLEY (Gilbert S. Rothenberg and Richard Farber, on the brief), Attorneys, Tax Division, Department of Justice, for Caroline D. Ciraolo, Acting Assistant Attorney General, Washington, D.C.

Appeal from the Tax Court (Joseph R. Goeke, Judge).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED, AND DECREED that the decision of the Tax Court is AFFIRMED.

Petitioner‐Appellant Humboldt Shelby Holding Corporation

(“Humboldt/Shelby”) appeals from the tax court’s March 19, 2014, decision

sustaining in full the tax deficiency and penalties against Humboldt/Shelby

determined by the Commissioner of Internal Revenue and the July 15, 2014,

decision denying Humboldt/Shelby’s motion for reconsideration. The tax court

upheld the Commissioner’s disallowance, applying the test articulated in this

Circuit for determining whether a transaction is a sham for want of economic

substance. See Gilman v. Commissioner,

(2d Cir. 1991). The tax

court found that the investment was devoid of economic substance and was

entered into solely for income tax benefits. We affirm substantially for the

2 reasons set forth in Judge Goeke’s comprehensive opinion. See Humboldt Shelby

Holding Corp. v. Comm’r,

(2014).

We have considered Humboldt/Shelby’s remaining arguments and find

them to be without merit. For the reasons stated above, the judgment of the tax

court is AFFIRMED.

FOR THE COURT: Catherine O’Hagan Wolfe, Clerk

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