New Cingular Wireless Pcs, LLC v. Georgia Department of Revenue
348 Ga. App. 516
Ga. Ct. App.2019Background
- Appellants (wireless carriers) sold wireless internet access in Georgia from Nov. 1, 2005 to Sept. 7, 2010 and contend sales tax was erroneously charged and remitted to the Georgia Department of Revenue (the Department).
- Appellants filed refund claims in Nov. 2010; the Department denied the claims in March 2015; appellants sued in April 2015 challenging the denial.
- The Department moved to dismiss, arguing (1) appellants had to refund customers first under Dept. Reg. 560-12-1-.25, (2) appellants lacked standing to seek refunds for pre–May 5, 2009 periods, and (3) the suit was a prohibited class-action refund claim.
- This Court previously affirmed dismissal based on the refund-first regulation, but the Georgia Supreme Court reversed that holding and remanded for consideration of the other two issues.
- On remand the Court held appellants lacked standing to seek refunds for taxes collected before May 5, 2009 because statutory amendments granting dealers standing took effect May 5, 2009 and are prospective.
- The Court reversed dismissal as to refunds for taxes collected after May 5, 2009, concluding the suit was not a barred class action because appellants sought refunds as dealers for the benefit of their customers (not on behalf of other dealer taxpayers).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing for pre–May 5, 2009 refunds | Dealers (appellants) could pursue refunds for earlier periods; amendments should apply retroactively | Amendments granting dealers standing are prospective; pre–May 5, 2009 dealers lacked standing | Dismissal affirmed for Nov. 1, 2005–May 4, 2009: dealers lacked standing because the May 5, 2009 amendments are prospective |
| Whether action is a prohibited class-action refund suit | Appellants sought refunds as dealers to remit funds to customers (not suing on behalf of other taxpayers) | The settlement required appellants to pursue refunds for a settlement class, rendering the suit a class-action refund barred by statute | Dismissal reversed as to post–May 5, 2009 refunds: suit is not a barred class action because appellants sue as dealers for their customers, not on behalf of other dealer-taxpayers |
| Retroactivity principle for statutory amendments | Applying amendments retroactively is necessary to allow practical recovery | Statutes are presumptively prospective; retroactivity not warranted absent clear language; substantive rights cannot be given retroactive effect | Court applied standard presumption against retroactivity and treated standing as a substantive right, thus prospective effect controls |
| Requirement to refund customers before seeking refund from Department (resolved by GA Supreme Court) | Appellants argued they need not refund customers first | Department relied on regulation requiring dealers to refund customers before seeking state refund | Supreme Court held appellants did not need to refund customers first; this Court adopted that holding on remand |
Key Cases Cited
- New Cingular Wireless PCS, LLC v. Georgia Dep’t of Revenue, 340 Ga. App. 316 (Ga. Ct. App. 2017) (appellate opinion affirming dismissal on refund-first regulation)
- New Cingular Wireless PCS, LLC v. Georgia Dep’t of Revenue, 303 Ga. 468 (Ga. 2018) (Georgia Supreme Court reversing appellate court on refund-first issue)
- Sawnee Elec. Mem. Corp. v. Ga. Pub. Serv. Comm., 279 Ga. 22 (Ga. 2005) (standing requires that the remitting party bear the burden of the tax)
- James B. Beam Distilling Co. v. State, 263 Ga. 609 (Ga. 1993) (party who did not bear tax burden lacks standing to recover refund)
- Sherman v. City of Atlanta, 293 Ga. 169 (Ga. 2013) (standing is entitlement to have court decide the merits)
- Amu v. Barnes, 283 Ga. 549 (Ga. 2008) (statute of limitations is procedural and limits time to bring accrued rights)