California Utility User Tax Refund Cases
Beginning in 2006, Chimicles Schwartz Kriner & Donaldson-Smith LLP (CSK&D), along with co-counsel, filed telephone tax refund claims on behalf of taxpayers in the City of Los Angeles, the County of Los Angeles, and the City of Long Beach, California, alleging that telephone taxes had been improperly collected on telephone services to which the tax code did not apply. The refund claims were denied and CSK&D filed three class action lawsuits seeking to recover the allegedly improper taxes.
On July 25, 2011, CSK&D and its co-counsel won a major victory in those actions when the Supreme Court of California unanimously held, in the landmark decision of Ardon v. City of Los Angeles, that the California Government Code permits taxpayers to file claims seeking tax refunds on behalf of a class of taxpayers.
On April 25, 2013, CSK&D and its co-counsel won a second major victory in the Supreme Court of California in another landmark decision, McWilliams v. City of Long Beach, holding that the Legislature did not intend to permit local governments to supplant the procedures specified in the Government Code with their own ordinances in order to preclude class refund claims.