Court Reporter: SJC-13139,
VAS Holdings and Investments, LLC
v Commissioner of Revenue.
-: Attorney Bowen, we're ready for you.
-: Good morning, Chief Justice Budd.
And it may it please the court,
Michael Bowen for the appellant
VAS Holdings and Investments, LLC.
The one critical takeaway from today's argument
is that the controlling legal authority
of the US Supreme Court
and this court supports the appellant's position.
The crux of this case is whether the Due Process
and Commerce Clauses permit the Commonwealth to impose tax
on capital gain income realized by VAS Holdings,
a nondomiciliary corporation
on the sale of its ownership interests in Cloud5, LLC,
a Massachusetts limited liability company.
The good news for this court
is that the path of disposition of this case
has been predetermined.
Controlling authority from the US Supreme Court
and this court instruct
that the tax can be upheld only by a finding
that VAS Holdings and Cloud5
were part of a unitary business.
To make matters even easier for this court,
the commissioner readily concedes
that VAS Holdings and Cloud5
did not form a unitary business.
So why are we here?
We are here
because the commissioner (indistinct),
the multistate tax commission
of MTC have asked this court to join them
in reading tea leaves.
The commissioner of the MTC invite the court
to wholly disregard controlling legal authority
and adopt a new and unsanctioned constitutional test,
that is investee apportionment.
This is so despite the fact
that the Commonwealth does not have a statute
or rule that supports the commissioner's theory of taxation.
The court must decline the invitation
of the commissioner
and the MTC to read tea leaves.
The arguments made by the commissioner
and the MTC in support of a new theory of taxation
are better suited for consideration
by the US Supreme Court, not this court.
There is no dispute between the parties
that the general rule
under both the Due Process and Commerce Clause
is that the state must not tax value
earned outside its borders.
When a company is headquartered
and operates a business solely in one state,
there are no extraterritorial constitutional considerations.
However, if the same company
grows to become part of a multi-jurisdictional business,
prickly constitutional questions
arise regarding how much of the company's income
is attributed or taxed in each state.
The US Supreme Court recognize this issue
and the concept of a apportionment was born.
The court has made clear, however,
that a state is only permitted to a portion income
in the context of a unitary business.
As consistently explained by the US Supreme Court
over several decades of decisions,
the linchpin of apportionability
is the unitary business principle.
The focus of the unitary business principle
is on the relationship
between the non-resident taxpayers-
Dalila: (indistinct)
-: Yes, your honor.
-: So given what you've just articulated
over the past few minutes,
how is it that New York
approved the investee approach?
Regardless of whether Massachusetts
actually has authorized this,
why couldn't Massachusetts adopt the New York approach?
-: Well, it's a great question.
In the New York cases that are cited by the appellee,
New York actually did have a law
that directly provided for investee apportionment.
And as far as the constitutional analysis went
in those cases,
they took a different view of International Harvester
than we do in this case.
And they applied their interpretation
of International Harvester to conclude
that it was constitutional.
But I will tell you, your honor,
that the New York reliance is of limited value
because in 2015 New York
repealed its investee apportionment rules.
Dalila: For constitutional reasons?
-: I'm sorry.
-: What did the repeal implicate its conclusion
that investee approach was unconstitutional
or was it sort of it's just not good business
to tax people for their investee-
-: That's an excellent question
to which I do not know the answer.
I do know that as part of the corporate income tax reform
in 2015, it was repealed.
And there are commentators who pose it
that it was repealed
because of constitutional considerations.
And I believe we cited those in our brief,
but yes, that is part of the equation.
-: Councilor, can I follow up with a question with,
so what about the argument that VAS Holdings
wasn't very profitable
until the folks here in Massachusetts,
the former Thing5 and the folks that got ported
into Cloud5,
that they were really they were really the linchpin
to the profitability
and the ultimate gain that we're all talking about here.
Isn't that enough nexus with Massachusetts
in order to support what the commissioner
is trying to do here.
I mean, your fellows realized significant gain
after the folks here in Massachusetts
streamlined the employee structure,
got rid of some bad contracts,
and then lo and behold, a couple of years later,
there's a real profit here
that was really at the hands of the folks
here in Massachusetts.
What do you say to that?
-: Your honor, there's no question
that there was an appreciation
of value of the business post-merger.
That's not the constitutional question.
The constitutional question is who can tax that value?
-: Well, part of the constitutional question
is based on whether or not
there's a nexus with the taxing state, right?
-: Right. -: I mean, so that's the point.
So when you look at the fact that the folks here
in Massachusetts were really the driving forces
behind the gain that was ultimately realized
isn't that enough?
-: It's not enough
because the connection asserted by the commissioner
is that between the Commonwealth and Cloud5,
but that's not the party subject to tax.
The party subject to tax is VAS Holdings,
a non-resident corporation.
And that's a critical distinction.
Under the unitary business principle
it requires there actually be a connection
between the non-resident and the taxing state.
The commissioner's theory,
which is unsupported by US Supreme Court authority
or this court's authority,
is that you only need to look to the in-state relationship
to be able to tax the out of state gain.
-: Can I ask then, this is a taxable event?
I mean, I'm not a tax lawyer,
but that seems a basic proposition, it's a taxable event.
So does that mean under your theory that Florida,
who can tax if we can't tax?
And how much tax was assessed by the other state?
-: Well, it's the latter question.
Let me just go through your questions in order.
The first question is yes, if Massachusetts doesn't tax it,
again, this goes to the issue of sourcing.
So at the end of the day,
if it's not sourced to Massachusetts,
the gain is sourced to the domicile
of the nondomiciliary taxpayer in this case, Florida.
But it doesn't have to be Florida.
The issue in this case can come up
in a lot of different circumstances.
Could have been a nondomiciliary-
-: Just tell me out again,
'cause I'd like to understand the practicalities
'cause I take it we wouldn't be here if it's just
Florida versus us,
and it was the same tax,
there's gotta be something more going on.
So I take it that
can Florida assess this whole tax that we've assessed?
And is this a battle between Florida and Massachusetts,
or is this somehow some kind of tax concealment issue
or tax avoidance issue that I don't understand yet?
-: It's not a tax avoidance issue if Florida could tax it.
I mean, if it wanted to it could tax it.
-: So it's fully taxable then in Florida?
-: It's not fully...
There was no...
The way that the tax worked, your honor,
is that VAS Holdings was a Florida S corporation.
-: And it had four- -: Through the owner-
shareholders...
I'm sorry to interrupt you.
-: And I don't mean to interrupt you,
I'm just trying to clarify,
but it's shareholders
are also Florida residents, right?
-: Not all of them.
-: Not all of them, okay.
But again, you say it's perfectly permissible for Florida
or where these residents live to tax
that it's just Massachusetts is exceeding its authority.
Is that your view?
-: Correct.
And in this case,
the record evidence is that other states
did in fact tax the gain.
-: The same amount?
How much did Massachusetts seek to charge in taxes
and how much did Florida impose in taxes?
Do we know that from-
-: Florida does not impose a personal income tax.
-: Okay, so there's no Florida personal income tax,
so again, how much- -: And-
-: Go ahead, sorry, Justice Gaziano.
-: Oh, no, I'm just trying to clarify.
So the tax goes to the shareholders
while they're in a state that pays income tax,
they'd be taxed on that.
Correct?
Bowen: Correct.
-: So Massachusetts shareholder of VAS Holdings
would have been taxed for the capital gains, correct?
-: So would an Illinois shareholder.
-: But the full megillah, the 37 million, not so much.
-: Correct, but that's not relevant
to the constitution analysis, Justice Gaziano.
That's just the result of application
of the unitary business principle in this case.
-: I understand.
We're trying to get the landscape.
Justice Kafker asked that helpful question
and give that landscape.
-: Because I'm trying to...
Again, 'cause Massachusetts, as Justice Georges points out,
has provided a regulatory system
that enabled Cloud5 to succeed.
So we could tax Cloud5, obviously it's income, right?
-: Correct. -: Correct.
-: And if they issue dividends,
we could tax dividends under International Harvester
or whatever that is. -: Correct.
-: It's just this capital gains,
who can tax the capital gains from this S corp?
-: You bring up a very good point, your honor.
And that's that if Massachusetts wanted to
it's completely within its right to tax Cloud5, the LLC.
It can oppose an entity level tax with no question.
Cloud5 operates in the state,
it generates income within the state,
it provides benefits and protections to Cloud5,
if it wanted to, it could tax Cloud5.
It could withhold tax on distributions to shareholders,
other states do that.
Other states have with a dividend given
under distributable income withholding tax
like International Harvester,
Massachusetts does not.
This case deals with the taxation of capital gain
something that is triggered
by a transaction that occurs outside the state
by a non-resident shareholder.
-: Can I ask you a follow-up of Justice Wendlandt's question?
In that is the New York instance an outlier?
I know you don't agree with it,
you said it was repealed for whatever reason
that it didn't go to SCOTUS.
Is the New York case an outlier?
-: Yes.
I believe it is an outlier.
And unfortunately, due to the passage of time,
I'm not really sure why,
but the New York decision, for example, in Allied Signal
is that the core case relied on by the commissioner
and this case was never appealed to SCOTUS,
even though Allied Signal prevailed
in its protests of New Jersey assessment
on the same income as SCOTUS.
I'm not sure why Allied Signal did not appeal
to the US Supreme Court,
I wasn't a party to the action, didn't participate,
none of that.
But our view is that it is an outlier.
-: Is that the only instance
of this principle being applied?
-: No, your honor.
In Ohio, the two states that had,
I should say one has,
New York had an investee apportionment law is Ohio.
Ohio has a provision that directly would apply
in this particular case.
Unfortunately for the commissioner,
in the case of Corrigan v Testa,
the Supreme Court of Ohio determined
that as applied to the circumstances of that case,
it was unconstitutional.
-: The Due Process Commerce Clause reasons.
-: And they took the exact same interpretation
of the relevant law as we have in this case.
So but our point is even in Ohio where they expressly
provide for investee apportionment,
they found in circumstances of this case
that it was unconstitutional
under the Due Process and Commerce Clause.
So your honor,
the core of the department's position,
I should say the commissioner's position
is reading tea leaves.
And I mentioned that previously,
and what I mean by tea leaves
is that they grab onto the last three paragraphs
of the MeadWestvaco decision as providing them a lifeline
for an investee apportionment.
Now, as I mentioned at the outset,
that was obiter dicta.
That has nothing to do with the holding of that case.
And in fact,
that case upholds unitary business principle firmly,
but their position is that is dicta that opened the door.
Now, as far as Massachusetts is concerned,
we have law on the books
that provides unitary business principle.
And in this court in General Mills in 2003,
they faithfully upheld it.
The MTC, however, has consistently banged the drum
for investee apportionment.
Dating back to the eighties,
they filed amicus briefs
in ASARCO and Woolworth arguing
for investee apportionment.
In 1992 in Allied Signal to US Supreme Court,
they argued for investee apportionment.
In 2008, in MeadWestvaco they argued
for investee apportionment.
And 10 months ago,
in the Noell Industries case that was on cert
to the US Supreme Court,
they also filed a brief arguing for investee apportionment.
In each instance the US Supreme Court
has rejected the invitation to pursue
investee apportionment even as an alternative theory,
much less as a primary theory for taxation
on the circumstances of this case.
Your honor, I'm gonna leave with what I began with-
-: That last statement- -: I'm sorry.
-: So the US Supreme Court has declined
to approve investee apportionment,
is that what you're saying?
-: My statement is that the MTC
has advocated that the US Supreme Court
adopt investee apportionment.
-: And my question is the US Supreme Court
has not adopted it,
but it also has not rejected it, is that right?
-: I think your honor,
and I see I'm running out of time,
do you mind if I finished my question
for the answer to my question?
-: No, I think we're okay, go ahead.
-: Okay, I think there are a couple of cases
where they call the MTC out
on its interpretation of investee apportionment
and the unitary business principle.
And my memory at this point is
I believe it's ASARCO where the US Supreme Court
notes that under the MTC's theory
that a non-resident would be liable
for tax merely on
the appreciation of the value of the entity
in which it is invested,
meaning on the flow-through of the appreciation
of the value.
And the US Supreme Court notes that
that is too broad
and of interpretation of the unitary business principle,
much less an interpretation of the restrictions
of the Due Process and Commerce Clause.
-: Can I ask just the prac...
I'm trying to understand if we adopt the opposite view,
I take it your view is there's gonna be chaos out there
in the taxation.
Give me some examples of what the negative consequences
if we adopt the commissioner's approach here.
I mean, if I buy stock in a Ohio corporation
and I sell it at a gain,
can Ohio
now tax me for that capital gain?
Will there be a fight between Ohio and Massachusetts
in that example?
I'm just trying to understand the practical consequences
of what happens if we adopt the commissioner's view.
-: Yeah, there are two primary negative consequences
in my view.
The first is what you've already raised.
So if you're a Massachusetts resident,
and you own stock in Ford Motor Company,
under the commissioner's theory of taxation in this case,
you as a Massachusetts resident
on the sale of your stock in Ford Motor Company,
theoretically would owe tax in every jurisdiction
in which Ford Motor Company does business.
Because every jurisdiction in which Ford Motor Company
does business would argue
that they've somehow attributed
to the appreciation of the stock that you just sold.
I think the second consequence
that's important to note is the coexistence if you will,
of investee apportionment states
and unitary business states.
Because of the diametrically opposed view
of the relationships necessary to sustain tax for each one.
Investee apportionment looks solely
with respect to the relationship
between the state and the in-state business.
The unitary business principle
looks at it completely different,
looking at the relationship
between the non-resident and the in-state business.
So there are myriad different types of examples
where there'll be states fighting over the same income
merely because they're taking two philosophically
different approaches to taxation
based on the location of the taxing state
and the non-resident.
-: Any other questions?
Great, thank you.
Attorney Goldberg?
You're on mute.
-: Good morning.
Brett Goldberg for the Commissioner of Revenue.
And may it please the court,
the Supreme Court has said that taxation
has been a means for distributing
the cost of government among those
who enjoy the benefit of its laws.
The constitutional analysis in this case starts
with the bedrock rule that a state has the power to tax
income of a non-resident derived
from activities within the state
because the state-
-: I'm sorry to interrupt you so early in argument
but I will forget the hypothetical
that your brother just threw out
about Ford Motor Company if I don't.
Can you address that?
If I invest in Ford Motor Company from Massachusetts,
I'm I now gonna be subject to all 50 states
under your theory of taxation?
-: No, your honor.
-: Why not?
What's the limiting principle?
-: Well, International Harvester theoretically
would permit that,
but I think no state including Massachusetts
takes an investee apportionment approach to corporate stock
only with respect to partnership interests.
And the reasons for that of course
is that a corporation is a separate taxable person,
whereas a partnership is a flow-through entity.
I think also as a constitutional matter,
a small stock holder in a corporation
in a publicly held corporation
could not be constitutionally subject to tax
in a state simply because the corporation
itself was operating-
-: Why not?
Because under your theory,
the benefit is the one provided to the corporation
that's value has gone up.
You're saying that's where Massachusetts interest is
and why wouldn't that apply to partnerships
and corporations alike?
I don't get why it's different?
-: Well, Massachusetts-
-: I understand practically chaos would ensue,
but I'm just trying to understand legally
why it's different.
-: I don't think chaos would ensue, your honor.
That International Harvester case was decided in 1944,
and there has not been a-
-: But that's a dividend case, that's different.
That's an income type dividend, it's not a...
I mean, people invest in stocks
everywhere.
And again, those corporations are benefited
from your Massachusetts regulatory
or the state's Michigan's regulatory environment for Ford
so I don't understand, you need to help us here
because that's frightening.
We don't wanna create chaos here.
So tell us why that's wrong?
-: That's wrong because a small stockholder
in a publicly traded corporation would not
under the Due Process Clause be subject to tax
in all those states
because it wouldn't have a sufficient connection
with those states.
And it wouldn't be on notice that it would be subject to tax
in those states.
A member of a partnership is on notice
that it is subject to tax in the states
in which it does business.
The small shareholder could not be subject to tax
under due process
because it wouldn't have the minimum connections
with the states simply because the corporation
was doing business there.
-: But what is the connection...
What's the difference between the connection
of the partnership here
and the connection of a casual investor in Ford?
-: Partners, a partner in a partnership.
First of all, there's two differences.
One is in the hypothetical
of the publicly traded corporation,
the investor is a very small investor.
1%, 2%, 10% maybe,
but that-
-: So the constitutional principle
would depend on the percentage ownership of Ford?
-: For a very small owner, your honor,
due process would bar a state
from imposing a tax on a non-resident
corporate shareholder
because there would not be sufficient connection
between the out-of-state shareholder
and the taxing state in that-
-: I'm sorry.
Would it be different for you Elon Musk or Jeff Bezos?
-: If they owned 50% or 80% of their corporations,
theoretically yes.
But in fact, that is not the law in any state.
-: Well, when it comes down to
is in the first question that Justice Wendlandt asked you
is give us the limiting principle.
And so you're basically telling us
trust us, it won't apply to the little guy.
-: It won't apply to the little guy
under the constitution, your honor.
I think that is the limiting principle.
States would be barred from taxing the little guy
because of due process, minimum connections required
in order to impose a tax.
-: How do you figure out where that line is
for planning purposes?
-: Well,
could you explain the question a little more?
-: Well, okay, so the little guy is not gonna be taxed,
the billionaires are,
everyone else needs to plan for taxing.
-: The billionaires aren't subject to tax, your honor,
because no state imposes
an investee apportionment regime on corporations.
And I think it would be very difficult as they say
under the constitution to do that.
It's possible under International Harvester,
but no state has done that,
and Massachusetts isn't doing that.
-: But this is, again, this is an S corporation.
It's a pass through.
So are there
small shares in this S corporation?
Little guys in the terminology we're using here?
-: I think there's some
12 or 15 shareholders altogether, your honor.
And some of them hold smaller percentages down to-
-: So take the smallest one in the record,
and talk us through how that person's connection
to the state is.
You say there are 12, who owns the least
and how much is it roughly?
Does that have any contact with Massachusetts?
-: They don't have any contact with Massachusetts
other than through the partnership,
but VASHI concedes that distributive share income
derived from the partnership is taxable by Massachusetts.
And that rule that imposes investee apportionment
on partnership distributed shares
is not just Massachusetts, it's common among many states.
And partnerships are different from corporations
because they are flow-through entities.
And there's no debate that
a distributive share of income
from a partnership is subject to
state tax where the partnership does business.
There's no question about that,
VASHI concedes that.
It's arguing only that there is a difference
for capital gains
from distributed shared income.
And the Supreme Court has said that there is no difference,
it's the underlying-
-: Again, you're relying on International Harvester,
which is a dividend-
-: No, your honor.
-: What also are you relying on for that proposition?
-: ASARCO and Allied Signal both say
that there were corporate cases,
but it applies to distributive share income as well.
That there is no difference constitutionally
between dividends or distributive share income
and capital gains.
It is the underlying business activity that matters
not the form of the income derived from those activities.
And as I say,
VASHI concedes in the distributive share context
that it is subject to tax,
that all its partners are subject to tax,
and that is, I think,
universally accepted notion
with respect to partnership taxation.
Corporations are different
because they are not flow-through entities.
And the corporate shareholders are not on notice
that they're subject to tax
in all the states in which a corporation does interest.
The partners in a partnership are on notice
and do expect, and it is widely accepted
that they are subject to tax in all the states
in which a partnership does interest.
Because
in fact,
if you're non-unitary partner in a partnership,
Massachusetts and many other states
use an investee apportionment approach,
that is they apportion the income derived
by the partner from the partnership solely
with reference to the partner's property payroll or sales.
-: Why shouldn't we just rely on Florida
to do this?
Why are we extending ourselves into...
What's the logic of that?
Because these people, it is a Florida corporation,
we both agree it's a taxable event, right?
-: Of course. -: The only issue is
who can tax it?
Who pays the tax on the capital gain?
And it is a Florida corporation,
and there are Florida shareholders,
why aren't they the people who should be taxing this
rather than us?
-: Your honor, it's very clear
under old Supreme Court case law,
Shaffer v Carter, (indistinct)
that states have jurisdiction
to tax based on
residents or source.
And two states
can tax the same income,
one based on residence,
and one based on source.
-: Here you take a hundred percent of the tax.
Massachusetts seeks to impose a hundred percent of it,
why is that?
Explain to me the logic of that.
-: Because substantially all of Cloud5's
property and payroll were located in Massachusetts.
-: I take it, they pay income tax here.
They pay their corporate income tax, whatever it is here.
So you're taxing Cloud5,
Massachusetts is taxing Cloud5
in a variety of different ways, right?
-: Cloud5 is a partnership, not a corporation
so it is not subject to tax at the entity level.
The partners are subject to tax
on their distributive shares of the partnership's income.
That tax though, that distributed share income
that's passed through results in an increase
in each partner's outside basis
and that reduces the capital gain
that the partner gets on sale of the partnership interest.
So there's no double tax here.
The tax that's-
-: Just again, I am not a tax lawyer
nor have I ever wanted to be one,
but so just tell me simply how does Massachusetts tax
besides this tax, how does Massachusetts tax Cloud9
or Cloud5, excuse me?
-: Cloud5 is not taxed at all, your honor.
VASHI,
the non-resident investor is taxed
on its distributed share
and those taxes increase its outside basis,
which reduce its capital gain on sale
and Massachusetts does tax that
the taxable portion of that capital gain on sale.
-: I understand we're fighting over the capital gains tax.
Does Massachusetts tax this entity?
'Cause I'm completely persuaded by your point
that we provide a benefit to Cloud5, I get it.
We provide a regulatory environment,
Cloud5 is the source of this increased value
so Massachusetts has some ability to tax.
I can't tell what they can and cannot tax.
What else do they tax besides...
If they don't get this, do we end up with nothing?
Or are we taxing somehow here?
Meaning if you can't get this capital gains tax,
is Massachusetts out of luck
and we get no revenue from this?
Or is there multiple ways that Massachusetts is taxing
this entity?
-: VASHI is taxed on its distributive share
and we've collected that.
And VASHI doesn't dispute that.
The capital gain is a different matter,
and if Massachusetts doesn't tax it, no state is going to.
-: Can you give me a rough number
what the distributed share tax was here
versus what is at stake here, for example?
Do you have those numbers in the record anywhere?
-: Yes, they are.
Well, there's the notices of assessments,
I think in the first volume of the record appendix.
-: So roughly, do you have a rough sense?
Again, we want Massachusetts to get the benefit
of the regulation it provided.
The question is,
are you getting other things of real value
and you're seeking something that's novel
and potentially problematic,
or are you getting nothing unless you get this?
So I'm just trying to get a rough sense
of the answer to that question.
-: I'm sorry.
Could you just ask that one more time?
I want to make sure I understand that.
-: Yeah, so again,
I'm persuaded that Massachusetts provides value to Cloud5.
Cloud5 is the source of this increased value.
Therefore Massachusetts should have some ability
to tax Cloud5.
What I don't really get,
and again, maybe my own ignorance,
is what else you're taxing there
and how that compares to the amount at stake here.
Is Massachusetts getting its chunk of change out of
Cloud5 in a variety of other ways?
-: We're not taxing Cloud5, again, your honor,
we're only taxing VASHI and its shareholders.
As a practical matter,
there was distributed share income
and I think 2011 and 2012,
there was none in 2013, it was quite a small amount
of distributed share income.
We did tax that
at the corporate level
and at the shareholder level at 5.25%,
and I think 2.75%
approximately,
but that was a very small amount
because Cloud5 didn't distribute very much income.
It did though increase tremendously in value as you know.
And that value, that increase,
the real benefits
that Massachusetts provided to
Cloud5 would not be taxed
if Massachusetts doesn't tax it here.
Let me caveat that a little bit.
There would be no tax at the entity level
'cause other states in general don't impose
an entity level tax on S corporations.
We do if they're very large S corporations.
There would be a tax for some of the shareholders
on their S corporation flow-through capital gain income,
but given Massachusetts jurisdiction to tax as well,
those states would give a credit to the shareholders
for the tax paid to Massachusetts.
So there wouldn't be any double tax
and the sum of the capital gain,
I think some 30% of the capital gain
because it would have been subject to tax in other states.
But if Massachusetts
is allowed to tax it,
those states give credit for taxes paid to Massachusetts.
I wanna clear up one point
which is this question of Massachusetts authority
under the regulation and statute to impose this tax.
I truly don't understand the assertion that it's not clear
because it is crystal clear in the regulation,
and the example quoted on page 59 of our brief
from the regulation
that a non-unitary partner in a partnership
is subject to tax
on its distributive share
and on the capital gain on disposition of the partnership.
There's just no question that Massachusetts
is permitted under its own regulations
and statutes to impose the tax.
That's why it wasn't really disputed
at the Appellate Tax Board.
Your honors, as you recognize, VASHI-
-: Mr. Goldberg, to that,
is a really important point to me.
And you said page 59 of your brief,
but your brief is 58 pages long.
Can you just- -: Sorry,
maybe I misspoke. -: Yes.
-: It's page 51.
-: 51, okay, great, thank you.
I'll just add that.
-: And that example, your honor,
is on all fours with our situation here.
It describes a corporation that's domiciled
outside Massachusetts,
and the non-resident partner is not engaged
in a unitary business with the partnership.
And it's very clear that disposition
of that partnership interest,
the non-resident is subject to tax apportioned
with reference to the partnership's payroll property
or sales.
Your honors, the VASHI here
and its shareholders gain great profits
from
the extensive employees, operations and property
that Cloud5 had in Massachusetts,
and there's nothing in the constitution that spares them
the responsibility in common with other taxpayers
of supporting the government
under whose protection they have profited.
-: Thank you very much.
-: Thank you, your honor.