675 F2d 1068 Emi North America Holdings Inc v. United States

675 F.2d 1068

82-1 USTC P 9371

Inc. and Capitol Records, Inc., Plaintiffs-Appellees,
UNITED STATES of America, Defendant-Appellant.

No. 81-5655.

United States Court of Appeals,
Ninth Circuit.

Argued and Submitted April 9, 1982.
Decided April 28, 1982.

Stanley S. Shaw, Jr., Washington, D. C., argued, for defendant-appellant; John F. Murray, Michael L. Paup, Ann B. Durney, Washington, D. C., on brief.

John Cooley Baity, Donovan, Leisure, Newton & Irvine, Los Angeles, Cal., for plaintiffs-appellees.

Appeal from the United States District Court for the Central District of California.

Before CHAMBERS, ELY, and NORRIS, Circuit Judges.


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After exhausting their administrative appeals, the appellees instituted suit in the District Court for refund of certain federal income taxes. Their claims were based on the contention that capital expenditures incurred in producing master sound tapes qualify for the investment tax credit pursuant to I.R.C. §§ 38, 46-48 (26 U.S.C. §§ 38, 46-48). The Government resisted the claims, primarily relying upon Treas.Reg. § 1.48-1(f). The District Court rendered summary judgment for the appellees, and the Government appeals.


The disposition of this appeal is squarely controlled by long-established precedent. Bing Crosby Productions, Inc. v. United States, 588 F.2d 1293 (9th Cir. 1979); Walt Disney Productions v. United States, 549 F.2d 576 (9th Cir. 1976); Walt Disney Productions v. United States, 480 F.2d 66 (9th Cir. 1973), cert. denied, 415 U.S. 934, 94 S.Ct. 1451, 39 L.Ed.2d 493 (1974). Because master prints of movies and master sound tapes are functionally identical, no principled distinction can be drawn between the authorities cited and the present controversy. See also, Texas Instruments, Inc. v. United States, 551 F.2d 599 (5th Cir. 1977).


The judgment of the District Court is affirmed. This court's judgment shall issue forthwith, and no Petition for Rehearing will be entertained. See Rule 2 Fed.R.App.P.