The US Supreme Court (Court) recently granted Sonoco Products Co. (Sonoco)¹ and Gillette Commercial Operations North America and Subsidiaries (collectively, Gillette)² separate requests for an extension of time to file a petition for a writ of certiorari to the Court. Sonoco and Gillette are appealing the Michigan Supreme Court's denial of application for leave to appeal the September 29, 2015 judgment of the Michigan Court of Appeals upholding the constitutionality of the retroactive repeal of the Multistate Tax Compact (Compact), a provision of which allowed a taxpayer to elect to use the Compact's equally weighted three-factor apportionment formula to determine certain Michigan tax liabilities. The extended deadline to file the certiorari petitions with the Court is November 21, 2016.

The Court has indicated that, if received for this matter, multiple petitions for certiorari will be consolidated into a single case at the Court level as taxpayers were consolidated at the Michigan Supreme Court level. Assuming the certiorari petitions are filed in November 2016, experience suggests that the Court will not likely determine whether to grant or deny certiorari until early 2017, at the earliest.

Implications

Until the issue is finalized either by the Court denying certiorari or further state action upon a ruling of the Court, the application of the Compact election in Michigan remains open. Taxpayers should continue to review their positions and take the steps necessary to preserve their appeal rights. Taxpayers that have already protested the denial of the Compact election should continue to hold their appeals in abeyance pending the Court's decision as to whether or not to review this issue.

For additional details on the MTC election please see Tax Alert 2016-1178 and 2015-2006.

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ENDNOTES

¹ Sonoco Products Co. v. Dep't of Treasury, No. 152598 (Mich. Sup. Ct June 24, 2016), application to extend time to file granted, No. 16A250 (US S. Ct. Sept. 9, 2016).

² Gillette Commercial Operations North America and Subsidiaries v. Dep't of Treasury, No. 152588 (Mich. Sup. Ct June 24, 2016), application to extend time to file granted, No. 16A263 (US S. Ct. Sept. 13, 2016).