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Access over workers' compensation decisions, including En Banc, Significant Panel Decisions, and writ-denied cases.

Case No. MISSING
Regular Panel Decision

Hegar v. Gulf Copper & Manufacturing Corp.

Gulf Copper and Manufacturing Corporation sued the State of Texas seeking a refund of franchise taxes paid under protest, claiming entitlement to a revenue exclusion for subcontractor payments and to deduct these payments as 'cost of goods sold' (COGS). The trial court ruled in favor of Gulf Copper. On appeal, the court upheld Gulf Copper's right to the revenue exclusion for subcontractor payments. However, the appellate court reversed the trial court's judgment regarding the COGS deduction, finding both Gulf Copper's and the Comptroller's calculation methodologies flawed and lacking sufficient factual support. The case was remanded to the trial court for further proceedings to accurately determine the COGS deduction and the exact refund amount.

Tax LawFranchise TaxRevenue ExclusionCost of Goods Sold (COGS)Statutory InterpretationAppellate ReviewTexas Tax CodeSubcontractor PaymentsOil and Gas IndustryReal Property Improvements
References
15
Case No. MISSING
Regular Panel Decision

Hegar v. Sunstate Equip. Co.

Sunstate Equipment Co., LLC, which rents heavy machinery, included delivery and pick-up fees in its Cost-of-Goods-Sold (COGS) deduction under Texas Tax Code section 171.1012. The Comptroller of Public Accounts, Glenn Hegar, audited Sunstate and disallowed these deductions, leading to an assessment of nearly $130,000 in taxes and $11,000 in penalties and interest. Sunstate paid under protest and sued for a refund, winning at the trial court. On appeal, the Court reversed the trial court's judgment, ruling that Sunstate's delivery and pick-up costs are not eligible for COGS deduction under section 171.1012(k-1) or section 171.1012(i). The Court clarified that the deduction is for costs of acquiring or producing the equipment, not for selling or distributing it.

Franchise TaxCOGS DeductionTax CodeHeavy Equipment RentalDelivery FeesPick-up FeesTax AuditSummary JudgmentStatutory ConstructionAppellate Review
References
14
Case No. NUMBER 13-21-00335-CV
Regular Panel Decision
Oct 19, 2023

Anadarko Petroleum Corporation v. Glenn Hegar, Comptroller of Public Accounts of the State of Texas, and Ken Paxton, Attorney General of the State of Texas

Anadarko Petroleum Corporation appealed the denial of its petition for a refund for overpayment of state franchise taxes, arguing it was entitled to deduct a $4 billion settlement payment as costs of goods sold (COGS). The settlement was made to British Petroleum (BP) for claims related to the Deepwater Horizon disaster. The trial court concluded that the settlement payment was for tort damages for gross negligence, not for expenses incurred under joint interest billings. The Thirteenth District of Texas Court of Appeals affirmed the trial court's judgment, finding sufficient evidence that the payment was for tort damages and not deductible as COGS under Texas Tax Code Ann. § 171.1012.

Texas Tax LawFranchise TaxCosts of Goods Sold (COGS)Settlement PaymentsDeepwater Horizon DisasterTort DamagesGross NegligenceOil and Gas IndustryTax RefundAppellate Review
References
8
Case No. MISSING
Regular Panel Decision

Formal Opinion No.

This opinion from the Chairman of the New York Workers' Compensation Board addresses the priority of income execution and income deduction orders, established by the 1985 Support Enforcement Act (CPLR §§ 5241, 5242), against other statutory deductions from workers' compensation awards. Historically, WCL § 33 provided broad exemptions for workers' compensation benefits. However, WCL §§ 206(2) and 25(4)(a) allow for reimbursement of disability insurers and employers for advance payments, respectively, and WCL § 24 establishes liens for attorneys' fees, traditionally enjoying highest priority. The 1985 Act amended WCL § 33 to make benefits subject to support enforcement and also stipulated that income executions and deduction orders take priority over other assignments, levies, or processes. The Board concluded that claims for attorneys' fees and reimbursements by disability insurance carriers and employers are to be deducted first from the workers' compensation award. The support enforcement remedies under CPLR §§ 5241 and 5242 then apply to the balance of the workers' compensation benefits paid to the employee. This approach ensures prompt payment to injured workers and prevents double payment issues.

Workers' CompensationSupport Enforcement ActIncome ExecutionIncome DeductionLien PriorityStatutory InterpretationDisability Benefits ReimbursementEmployer ReimbursementAttorneys' Fees PriorityCPLR 5241
References
9
Case No. MISSING
Regular Panel Decision

Zeluck v. Board of Education

The case involves a motion by the Attorney-General to dismiss a petition filed by certain teachers. The teachers sought to enjoin the Superintendent of Schools from implementing payroll deductions mandated by Civil Service Law section 210, also known as the Taylor Law, for their alleged participation in a strike. The petitioners argued the law was unconstitutional, infringing upon rights to free association, speech, and equal protection, and that its payroll deduction provisions constituted a bill of attainder and violated due process. The court, citing precedents, rejected the arguments regarding free association, speech, and equal protection. It also found the due process procedures for payroll deductions sufficient, concluding the law was not a bill of attainder. Therefore, the motion to dismiss was granted.

Taylor LawCivil Service LawPublic Employee StrikesPayroll DeductionsDue ProcessFreedom of AssociationFreedom of SpeechEqual ProtectionConstitutionality of StatuteMotion to Dismiss
References
5
Case No. 03-14-00713-CV
Regular Panel Decision
Jul 21, 2015

Glenn Hegar, Comptroller of Public Accounts of the State of Texas, and Ken Paxton, Attorney General of the State of Texas v. CGG Veritas Services (U.S.), Inc.

This Appellee's brief is submitted by CGG Veritas Services (U.S.), Inc. in a case challenging the Comptroller's disallowance of a $567 million Cost of Goods Sold (COGS) deduction from its 2008 Texas Franchise Tax. The trial court ruled in favor of CGG, finding it eligible for the deduction and ordering a refund. CGG argues it qualifies as an "actual owner" of seismic data sold through its multi-client data library, which it contends is "artificial tangible personal property" under the Tax Code, and/or a "deemed owner" by furnishing labor and materials for oil and gas real property improvement projects. The brief asserts that its activities constitute necessary labor and materials for oil and gas well construction and that the Comptroller's arguments misinterpret the statutory provisions and rely on a previously rejected "physical change" theory. CGG seeks to affirm the trial court's judgment, arguing that all claimed costs are allowable and that the Comptroller waived challenges to specific costs.

TaxationFranchise TaxCost of Goods SoldCOGS DeductionTax CodeStatutory ConstructionAppellate LawReal Property ImprovementSeismic DataOil and Gas Industry
References
26
Case No. MISSING
Regular Panel Decision

Dallesandro v. Dallesandro

This opinion addresses a motion by Nationwide Insurance Company, the workers' compensation carrier for the respondent's employer, to vacate a wage deduction order issued on June 26, 1981. The original order directed Nationwide to withhold $95 per week from the respondent's workers' compensation benefits for the support of his former wife and two children, due to the respondent's failure to pay. Nationwide contended that it was not explicitly authorized by Personal Property Law § 49-b and that workers' compensation benefits were statutorily exempt from support claims. The court rejected both arguments, holding that carriers acting as employer agents are bound by the law and that workers' compensation exemptions do not apply to support claims, citing legislative intent evidenced by the repeal of a former exemption. Consequently, the motion to vacate was denied, and the carrier was directed to comply with the original order.

Wage Deduction OrderWorkers' Compensation BenefitsChild SupportAlimonyStatutory InterpretationPersonal Property LawWorkers' Compensation LawCarrier LiabilitySupport EnforcementLegislative Intent
References
7
Case No. MISSING
Regular Panel Decision

Argonaut Insurance Co. v. Baker

The case addresses whether a workers’ compensation carrier can seek full reimbursement from a third-party settlement, including amounts paid from an employer’s deductible. The Texas Legislature mandated that carriers offer deductible plans, with carriers making all benefit payments and employers reimbursing the deductible periodically. When an employee is injured by a third-party tortfeasor, the carrier is subrogated to the employee’s rights. The core dispute is if reimbursing the carrier for the deductible amount violates the Insurance Code’s prohibition against requiring an employee to pay any part of the deductible. The Texas Supreme Court concluded that such reimbursement from a third-party recovery is permissible, as the funds originate from the responsible third party, not the employee, and is consistent with established subrogation laws.

Insurance DeductibleSubrogation RightsThird-Party RecoveryStatutory InterpretationEmployer ReimbursementEmployee RightsAppellate ReviewSummary JudgmentInsurance CarrierLabor Code
References
7
Case No. MISSING
Regular Panel Decision
Feb 27, 1978

M. H. v. J. H.

This case addresses a motion by the Brewery Workers Pension Fund to vacate a payroll deduction order issued by the Family Court. The order required the Pension Fund to deduct $35 per week from a retired respondent's pension for child support, benefiting the petitioner. The Pension Fund contended that the deduction violated its plan's anti-alienation provision, was not authorized by section 49-b of the Personal Property Law, and was preempted by the Employee Retirement Income Security Act of 1974 (ERISA). The court denied the Pension Fund's application, ruling that New York State law permits such deductions for child support despite pension plan restrictions and that ERISA's anti-assignment provisions do not prohibit court-ordered garnishments for support obligations, distinguishing them from voluntary assignments.

Child SupportPension GarnishmentERISA PreemptionPayroll Deduction OrderFamily LawSupport EnforcementAnti-Alienation ClausesState Law vs. Federal LawVoluntary vs. Involuntary TransferNew York Judiciary
References
19
Case No. MISSING
Regular Panel Decision

Baker v. Argonaut Insurance Co.

This case addresses an insurance company's right to be reimbursed for workers' compensation benefits paid to an injured employee, specifically concerning reimbursement from an injured employee who receives benefits under a deductible plan insurance policy. The Bakers appealed the trial court's decision allowing Argonaut Insurance Company to recover the full amount of benefits paid to Anthony Baker, arguing that the recovery included the employer's deductible amount, which is forbidden under Texas law. The Bakers also challenged the trial court's award of attorney's fees. The appellate court agreed with the Bakers, modifying the trial court’s order to reduce Argonaut’s award by the deductible amount and reversing the attorney's fee award, remanding that issue for further proceedings. The court held that the deductible amount cannot be recovered from the employee's settlement proceeds.

workers' compensationinsurance reimbursementdeductible plansubrogation rightsattorney's feesstatutory interpretationTexas Labor CodeTexas Insurance Codethird-party recoveryemployer liability
References
4
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