Oregon - Bankruptcy Court, no nexus due to intangible presence

January 2013


A corporate parent filed an Oregon consolidated return with its subsidiaries. Following the sale of the subsidiaries, the Department of Revenue sought to impose tax owed by the subsidiaries on the out-of-state parent corporation. The bankruptcy court found that the imposition of tax violated the Due Process Clause because the parent had no employees, tangible property, or revenues associated with Oregon and because the parent did not receive benefits from in-state intangible property used by its subsidiaries. The court also held that finding the parent liable for the tax of its subsidiaries merely because it allowed the free use of its trademarks and received a dividend would deeply burden interstate commerce in violation of the Commerce Clause. [In re Washington Mutual, No. 08-12229 MFW, 2012 WL 6623678, Bkrtcy. D. Del. (12/19/12)]

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