we understand the fact that under food you got this definition of employer which everybody seems to agree would be useful both for food and for fica right yes or ok confrontation remittance of those taxes for example there was a district court case no i'm not sure that's true i mean if that seems to be true in terms of withholding under yes in court's decision in opera i don't i don't see we're in this statute there's a similar provision but the one that was in the in the op case in other words i don't see how the common law employer is relieved of liability because it psych test i presume you would think in the soon that the production companies here would be able to consider their pain independently or would you still be taking the position that no no aggregate the aggregate or whatever you call the payroll tax processor person is therefore not going to be able to derive the benefit from the stiff two thousand dollar cutoff for exemption i far as i understand the statute the person in my client's position which is the person in control of the payment of wages and which doesn't has visibility into who the common law employer is is the one who calculates the wages and is the one who is responsible for the payment and that is the person to whom whatever the limits for the minimum has congress applies in just  right your honor what whose question should i answer for when it let me come to you and if i may come back to judge pros in this case in this audit the audit team said maybe we should go after the common law employers and they went to the national office of the i r s and the chief counsel said don't do that that would be novel and aggressive so pretty so the question of the question is if they would go here after the come along ploy or even if they did that seven thousand dollar limit would be on a per employer basis correct i don't think so no that not be think i think if you look at the limitation which is on page a roman and two of my briefs it says that let's exclude it here there's a series of exclusions and the one that we're dealing with is the very first one and and the exclusion is once you've paid seven thousand dollars to the employee provider means that if you're a common or employer you don't need to worry about it in your own right i'd let one only assume for purposes of the argument that that there that there would be a liability in a hypothetical situation which is not our situation but if we assume that there is the it could have been it might have been that the r s decided to go sue the production companies but they didn't do that what they said was we think you are liable to the payroll service company and when i look at this chap i say alright i've got seven thousand dollars that right no i don't think so because if they go sue somebody else i don't care right but but if this is really needed used if what i'm saying is the way you read the cap is it depends on the after after the fact they reimburse them in most cases but the payment of the legal control of the payment of wages is between senate passed and the employee and so in that case if you read depending on whose soon if it's the if they sue the service provider at seven thousand dollars for the service provider if it's the sue the common lawn ploy or it's seven thousand dollars per employee or why isn't that the correct technical advice memorandum in the record your honor which in which the i r s national office said that fact the fact that they got paid after if at all was material in making them the party in control of the payment of wages and not the common law employer and that was carried over to the stipulation in the record about page eighteen thirty five when was there any consideration of whether this business arrangement of who pays the employee was a matter of convenience was commercially sound so the government hints that the whole thing was a master plan to achieve breakage question you can see from the amicus briefs you can see from the expert reports you can see from the government's admissions in the i r s reports this was a real business of real substance the fundamental core value that they delivered was compliance with a web a very complicated web of comp of collective bargaining agreements that the independent producers didn't have the resources or know how to comply with but it doesn't seem to be responsive i think the question is is your client collecting from the common more lawyers based on the notion of a seven thousand dollars for employer cap and then  g for the government on different basis the answer to that is absolutely not first of all the clients we were were given alternate invoicing options one was a flat fee one was a pro forma with taxes that taxes were on a per production basis not on a per common law basis and when clients shows that second option they chose it for their own accounting purposes and you rebates at year end reflecting their volume that they provide to the two cent tax so they're very aware of it and the point of it is not that they it's not that these are taxes that they all then get passed to send cast and then get passed to the government that the the liability is imposed on lawyer who pays the wages rather than on the common law employer and that was the holding in the truth it can't be true that the common law employers case liability by hiring a service provides it must be of the tom sawyer is still libel for the  is agreed that that's not disc a case because because if it were this case we'd have to evaluate the statutes in a very different context here we agree everybody don't i i don't think so your honor i buy we know that when it comes to income tax withholding which is the lion's share of the money that gets remitted we that congress chose an either or scenario for the lion's share of the taxes so i don't see why it shocks us if if the fica and food of statutes are going to be read in perry materia with the withholding that's important here is that it it requires fica withholding as well and the supreme court said we're not going to read employers to the person who is the employer to be narrow although in rowing the supreme court said we want these statutes to be read in perry material so i think that i mean i want to get off this issue of of sort of the fiala g of whether you can whether the common law employer could escape live villainy because what we have here is a statute in which everybody's a statute in a fact pattern in which everybody agrees that the service provider is liable and has fines to pay and the question is what is the limit on that liability and the reason that they're liable is because the taxes imposed on the employer who pays that's in thirty three l one and i read the limitation on libel it which has the same wording to mean the same thing and especially when i say well does the employer is the employer or somebody who pays and i look at the definition and the definition says yes there is an employer who pays is defined as an employer that's why i think i meet the statute your honor i know that i've exceeded my time there is another issue involving variance and and really the rest here for the government and we'll save your rebuttal time and we'll see how have please do this the court has ordered up for the united states but let's assume that they're on the common law employer is still liable even if they hire a service provider the cap applies on the seven thousand dollars per employer basis to the common law employer why shouldn't we have the system where if you choose to sue the service provider you have to go on a seven thousand dollar per service provider cap whereas if you choose to sue the common law employer then it's a seven thousand dollars per common plan you are stupid yeah i understand your question and i understand that that was the crux of your question before judge died i think  the answer to that is really the structure of fica and food and how it employers are treated differently than employees there's no indication that congress intended that employers could aggregate in the same way as employees remember an employee of course is just passed on the total amount they receive from all players over the course of the year congress has not said the same thing in terms of employers as you yourself pointed  absolutely so if you choose to go after the common law employer there libel this is only the seven thousand dollars per employer at the tax that you're trying to collect from the service provider i'm going to assume that the problem that i have is if you elect to go after the service provider why are we reading employer to mean service provider in one place in the statute and reading employer to mean come along ploy and the other p to the supreme court decision in which my friend talked about the supreme court decision and basically grafted the thirty four zero one do you one employer onto the person who's responsible for reporting you and getting taxes for fica and food for employer provision and actually has the exception for the calculation of ways and that's what that is just as you that's why you have two different employers you have the employer who is responsible for reporting every minute which in this case would be the statutory employer and then you have the employer for purposes of determining the liability and that's what the the ninth circuit recently said in blue it is that important thing that the common law employment relationship is the trigger for food and fight the liability not the statutory important relationship and that's precisely why you should look at the common law employer rather than the statutory employer when you're saying rape well i think it's a leap but i think it's a leap it's justified as the night circuit found a blue like this is the saying this is the same point that was raised and mackerel now the reason why it seems like the lead is because again the supreme court's decision that up there was no equivalent to the provision is judged i pointed out to thirty four hundred one de wine in flight and food remember it was grafted on by the supreme court and the supreme court imported the withholding tax provision and it makes sense because what the what supreme court was concerned about in iraq was to make sure that the person who was in charge of the payment of the wages was the that was the entity did by the production company or i they provided say to somebody to do this or that program sort of pool handled by this appellant i believe that these employees are selected by the production companies and then they're put on the payroll of the payroll servicing company so entertainment partners is the person who signs their checks but in terms of the common long players that's the production companies and the question is whether it's studios a single production out of that is that's another question but the production companies control their employment which is actually a settled fact and as i was one of the settlement issues and the the traditional way of life than the sexiest things i think that that's right and in some cases there will be a question of who is the common long court in this case there is no question to factor and so yes i think that the that out most times the law firm in your hypothetical would be a common law employer i had a question about this two thousand and nine unless my problem is that on the questions about this aspect of i'm trying to figure out how the statue of limitations works here is it is i understand let's assume that their head we were not in a partial payment i'm not talking about that but the one of the four point three whatever it was that was not the subject of the initial refund claim why why is it that they he had to raise  time in mind without introducing any new issues just so that the entire liability can be determined at one time so one of the board can raise the independent contractor question with respect to the refund suit based living well in two thousand and nine and that those of those amounts were already at issue so those amounts were actually applied to or not applied but they went with the government's filing of the counter claim that's the critical element well i i think that it is the entire is the type of response to that issue i think that the fact that the divisible tax refunds to which the government does file a pro forma counter claim that is your right that's what's the most important factor once everything to that issue so the government hadn't filed the counterclaim then they would be able to raise the independent contractor thing with respect to the four point three i think that's right but you know that four point three million is act issue so there's defense other than what they've asserted in the lawsuit in response to the government's counter that's totally right there and it's you know obviously that that levy claims for the levy refund option only has to do with the four point three million dollars certainly can't bootstrap it for the rest of it but even on that four point three million dollars it was already an issue and determined determination here will resolve that four point three million dollars so can we find since it's collection matters proceeding but then they're all wrapped into that original divisible tax refund what in those do in those partial payment situations would be typical for the taxpayer and iris to read between themselves that the outcome of the rest of it would depend on the resolution of partial payment what that exactly what these cases are about but there was no i don't see that there was such an agreement here well there's no there's no official agreement it's just the way around the full payment rule florence is there usually a formal agreement now it's just for example in the sixty six seventy two responsible party person test i've had a couple of those cases in so it's just it's just kind of a lock step in the divisible tax area and of course just to get away from the two thousand and nine plan for a moment on the other the other part of the court a employer i don't want to read debated i just want to give the court the citation to the case i was mentioning which is called general motors the citation is ninety one dash one us tax court statue relating to fica and food and i think it's informative one one nuance i want to mention here in this regard is that the withholding is structured a little bit differently than five in fouda the withholding statute calls wages remuneration for services provided to the employer and so they have to separate you know who the m v when you've got this statutory employer they they have to say that wages don't mean that statutory employer because otherwise you have sort of a round was in the statute but in fica and food they may have three relevant definitions employer wealthy food of employer wages and employment and wages has to do with the remuneration and if you look at all the exclusions there are things where there's a payment being made and then employment is services in a common law relationship and if you look at the exceptions they all deal with status like like you work for an indian nation which was what the blue lake case was about so a case like will leg this is the second thing i wanted to address blue lake was really about the definition of employment not about the definition of wages that's the second thing the third thing is i wanted to come to the two thousand and nine refund claims that the court was asking about that this two thousand and nine claim that i had to file was required i couldn't get that four point three million dollars back without filing that claim the only way to get the four million three was to file that claim and once i was filing the claim i was alive i was within the statute of limitations it was within the two years i was allowed to bring any any ground i wanted and i was allowed to file it either in the  federal claims or in district court by filing the court of federal claims i didn't waive my right to argue what i was arguing before it's the same claim same grounds that i and i could made in district court do you agree with the said that was a vote that you couldn't amend the original point because they're going to case that started but what the new claim was within the sachin patients it was viable and this court in relatively recent years followed all state in the computer vision case which i guess i think you're on the rocker if i remember correctly so so an amendment everybody agrees it's too late to amend that old to playing but but the new together the own nine claims with recruitment and they're saying well it's a divisible tax and so therefore you're not allowed to raise recoupment and and the in answer to that is that there are no judge made exceptions to recruitment the supreme court in each against auckland which is i cited in my reply brief says recruitment is always available in less congress says it's not and then the fourth thing i'd like to address just briefly is this idea of delay which doesn't go to the own nine claim the judge said the own ninth claim was perfectly timely but he on his on the recruitment issue said well even if i'm wrong on recruitment i'm going to call a foot fault that any and the problem with the foot fault is he said in two thousand and ten oh you should know raised this two years earlier and he supervised discovery all along for two years i was in this courthouse every month talking to the judge about independent contractors and quantifying that overpayment and then two years later he says oh you know you shouldn't raise that two years ago it that's not it it's not cricket and and the government's delaying in raising the un to delay defense is a