Title: In re Income Tax Protest of Scioto Ins. Co.

State: oklahoma

Issuer: Oklahoma Supreme Court

Document:

IN THE MATTER OF THE INCOME TAX PROTEST OF SCIOTO INSURANCE CO.2012 OK 41Case Number: 108943Decided: 05/01/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA
NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN 
THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR 
WITHDRAWAL. 

IN THE MATTER OF THE INCOME TAX PROTEST OF SCIOTO INSURANCE 
COMPANY:
SCIOTO INSURANCE COMPANY, Appellant,v.OKLAHOMA TAX 
COMMISSION, Appellee.
CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I,ON 
APPEAL FROM THE OKLAHOMA TAX COMMISSION
¶0 The Oklahoma Tax Commission assessed corporate income taxes against Scioto 
Insurance Company, a Vermont corporation, for 2001 through 2005, based on 
payments Scioto received from the use of Scioto's intellectual property by 
Wendy's restaurants in Oklahoma. In response, Scioto protested these assessments 
on the ground that it did not contract with the Wendy's restaurants in Oklahoma 
for use of the property in question and did not conduct any business whatsoever 
in Oklahoma. The Tax Commission denied Scioto's protest and the Court of Civil 
Appeals affirmed. This Court has previously granted certiorari. Upon review, we 
vacate the Court of Civil Appeals opinion, reverse the Tax Commission's denial 
of Scioto's protest and remand with instructions to sustain Scioto's 
protest.
CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION 
IS VACATED; ORDER OF THEOKLAHOMA TAX COMMISSIONIS REVERSED AND 
REMANDED WITH INSTRUCTIONS.
Timothy Manuel Larason, Anne E. Zachritz, ANDREWS DAVIS, A PROFESSIONAL 
CORPORATION, Oklahoma City, Oklahoma, and Paul H. Frankel, MORRISON & 
FOERSTER, LLP, New York, New York, for Appellant,Marjorie L. Welch, Interim 
General Counsel; Abby Dillsaver, Assistant General Counsel; Elizabeth Field, 
Assistant General Counsel, OKLAHOMA TAX COMMISSION, Oklahoma City, Oklahoma, for 
Appellee.
REIF, J.,
¶1 This case concerns the liability of Scioto Insurance Company, a Vermont 
corporation, for Oklahoma corporate income taxes for the years 2001 through 
2005. The Oklahoma Tax Commission assessed Scioto corporate income taxes for 
these years based on payments it received from the use of Scioto's intellectual 
property by Wendy's restaurants in Oklahoma. The intellectual property in 
question consists of trademarks and operating practices for Wendy's 
restaurants.
¶2 In support of its assessment, the Oklahoma Tax Commission points out that 
the amount of money Scioto receives for use of this intellectual property is 
based on a percentage of the gross sales of the Wendy's restaurants in Oklahoma. 
The Tax Commission contends that the case of Geoffrey, Inc. v. Oklahoma Tax 
Commission, 2006 OK CIV APP 
27, 132 P.3d 632, holds that this type of business connection to Oklahoma is sufficient 
to support taxation of an out-of-state corporation.
¶3 In support of its protest of the assessment, Scioto notes it was 
established under the laws of the State of Vermont by Wendy's International, 
Inc., to insure various risks of Wendy's International and its affiliates. In 
establishing Scioto, Wendy's International transferred the intellectual property 
to Scioto to meet the capitalization requirements of the State of Vermont for an 
insurance business. Scioto stresses that it is not in the restaurant business 
and has no say where a Wendy's restaurant will be located, including Oklahoma. 
Scioto notes that it does not provide insurance to any person or entity in 
Oklahoma.
¶4 Scioto admits that it derives income from licensing the use of the 
intellectual property but notes its only licensing agreement is with Wendy's 
International. Individual Wendy's restaurants in Oklahoma acquire the right to 
use the intellectual property under a sub-license with Wendy's International. 
Wendy's restaurants in Oklahoma pay 4% of their gross sales to Wendy's 
International for use of the intellectual property and Wendy's International 
reports such income to the Oklahoma Tax Commission. Wendy's International, in 
turn, pays an amount equal to 3% of such gross sales to Scioto under the 
licensing agreement with Scioto and deducts this 3% payment amount on its 
Oklahoma tax return.
¶5 It is clear that use of the intellectual property in question by 
individual Wendy's restaurants in Oklahoma has several taxable consequences. 
First, it produces both sales of products and income that are taxable under 
Oklahoma law. Second, the use of the intellectual property by Wendy's 
restaurants in Oklahoma plays an important role in the production of 
employment-based taxes. Third, the right to use the intellectual property by an 
individual Wendy's restaurant is subject to ad valorem taxation as personal 
property in the county where the restaurant is located. See Southwestern Bell 
Telephone Co. v. Oklahoma State Board of Equalization, 2009 OK 72, 231 P.3d 638. Finally, there is no question that 
Oklahoma can tax the value received by Wendy's International in contracting with 
individual Wendy's restaurants in Oklahoma to use the intellectual property.
¶6 What is not clear is the basis for Oklahoma to tax the value received by 
Scioto from Wendy's International under a licensing contract that was not made 
in the State of Oklahoma and no part of which was to be performed in Oklahoma. 
Any further transfer of the right to use the intellectual property, including 
sub-licensing agreements with Wendy's restaurants in Oklahoma, is the legal act 
and sole responsibility of Wendy's International. In addition, the obligation of 
Wendy's International to pay Scioto based on a percentage of sales by Wendy's 
restaurants in Oklahoma is not dependent upon the Oklahoma restaurants actually 
paying Wendy's International. Wendy's International must pay Scioto under their 
licensing agreement whether or not any of the Oklahoma restaurants ever pay 
Wendy's International.
¶7 Oklahoma simply has no connection to or power to regulate the licensing 
agreement between Scioto and Wendy's International, any more than it had a say 
in whether the State of Vermont should license Scioto or allow the intellectual 
property to be one of Scioto's capital assets. Unlike the situation in the 
Geoffrey case, Scioto is not a shell entity and the licensing agreement 
between Scioto and Wendy's International is not a sham obligation to support a 
deduction under Oklahoma law.1 The sum paid by Wendy's International under the 
licensing agreement with Scioto is a bona fide obligation, and the payments 
received by Scioto are a source of income for Scioto's insurance business (none 
of which is carried on in Oklahoma). The Oklahoma Tax Commission cannot 
summarily disregard the licensing agreement simply because it produces a 
deduction that the Commission does not like.
¶8 Scioto and Wendy's International, like any taxpayers, are entitled to rely 
on settled law in the use of their property and in ordering their affairs, to 
maximize any benefits allowed under the state and federal tax laws of this 
nation. One of the most important principles of settled law upon which a 
taxpayer may rely is that a state will apply its tax laws consistent with due 
process of law. In the case at hand, due process is offended by Oklahoma's 
attempt to tax an out of state corporation that has no contact with Oklahoma 
other than receiving payments from an Oklahoma taxpayer (Wendy's International) 
who has a bona fide obligation to do so under a contract not made in Oklahoma. 
See Quill Corp. v. North Dakota, 504 U.S. 298 (1992). The fact that the 
Oklahoma taxpayer can deduct such payments in determining the Oklahoma 
taxpayer's income tax liability is not justification to chase such payments 
across state lines and tax them in the hands of a party who has no connection to 
the State of Oklahoma.2
CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION 
IS VACATED; ORDER OF THEOKLAHOMA TAX COMMISSIONIS REVERSED AND 
REMANDED WITH INSTRUCTIONS.
¶9 COLBERT, V.C.J., KAUGER, WATT, WINCHESTER, REIF, and COMBS, JJ., 
concur.
¶10 TAYLOR, C.J., and GURICH, J., dissent.
¶11 EDMONDSON, J., disqualified. 
FOOTNOTES
1 Geoffrey, Inc. was formed 
and incorporated as a part of a reorganization of its parent corporation Toys 
'R' Us, Inc. The parent corporation assigned its trademarks and operating 
practices to Geoffrey in exchange for Geoffrey, Inc. stock. Geoffrey, Inc., in 
turn, licensed use of the trademarks and operating practices back to its parent 
corporation. The parent corporation engaged in business in Oklahoma and paid 
taxes on its Oklahoma derived income, but deducted the royalty paid to Geoffrey. 
During the tax years at issue, Geoffrey had no full-time employees, conducted 
its business from office space it leased from an accounting firm and its sole 
activity was to license the trademarks and operating practices to the parent 
corporation. Geoffrey, 2006 OK CIV APP 27, ¶ 3, 132 P.3d  at 634. In 
contrast, Scioto is a licensed and regulated insurance company that carries on a 
business entirely different from Wendy's restaurant business. 
2 The proper point at which Oklahoma can assess taxes on 
the amount that Wendy's International pays to Scioto is when those funds are in 
the hands of Wendy's International. If the Tax Commission believes the amount 
paid by Wendy's International to Scioto should be taxed, then the Tax Commission 
should ask the Legislature to eliminate the deduction for payments made under 
licensing arrangements like the one in this case. While the Tax Commission is 
properly concerned with the taxation of business activity in Oklahoma, the Tax 
Commission cannot unilaterally close deduction lacunae or gaps in the revenue 
law with which the Commission disagrees. "[T]he proper remedy for OTC is not to 
have the courts expand the . . . Tax Code's scope . . . but rather to press for 
the gap's closure by the Legislature." Globe Life & Accident Ins. Co. v. 
Oklahoma Tax Commission, 1996 OK 39, ¶ 19, 913 P.2d 1322, 1329.

GURICH, J., with whom TAYLOR, C.J. joins dissenting:
¶1 I respectfully dissent. I would affirm the imposition of corporate income 
tax by the Oklahoma Tax Commission. 
¶2 Scioto Insurance Company is a subsidiary of Wendy's International, Inc. 
The company is responsible for providing business interruption insurance to 
Wendy's and its affiliates.1 Oldemark, LLC is a Vermont holding company whose sole 
purpose is to maintain ownership of Wendy's intellectual property rights.2 Oldemark controls the 
fast-food company's trademarks, copyrights, and knowledge related to opening and 
operating a Wendy's restaurant. In return, Oldemark receives revenue associated 
with the use of these intangibles by Oklahoma Wendy's franchises. Scioto is the 
sole member of Oldemark; therefore, the LLC is a disregarded entity for tax 
purposes.3 All income of Oldemark is attributable to Scioto.
¶3 Pursuant to an October 2001 amended licensing agreement, Oldemark granted 
Wendy's the right to use and sublicense its intellectual property to 
affiliate-owned and franchisee-owned restaurants. In return, Wendy's paid 
Oldemark a license fee equal to three percent (3%) of restaurant gross sales. 
Wendy's sublicensed the intellectual property rights to individual franchises 
for a fee equal to four percent (4%) of the restaurant's gross sales. 
¶4 Wendy's franchise disclosure documents informed prospective franchisees 
that Oldemark was the owner of the intellectual property. The disclosure 
documents also indicated that Oldemark "records on its books the royalty 
income received by Wendy's from you and its other franchisees, while Wendy's 
serves as the collecting agent for the Oldemark royalty income."4 Following receipt of 
royalty payments from Oklahoma franchises, Oldemark loaned the income back to 
Wendy's in exchange for demand notes. Wendy's claimed deductions equivalent to 
the three percent (3%) royalties and interest on the notes which was paid to 
Oldemark.5 The practical effect of these transactions was the 
virtual elimination of state income tax liability on earnings associated with 
licensing fees emanating from Oklahoma sales.6 
¶5 For the relevant taxable periods, only Wendy's filed Oklahoma corporate 
income tax returns. On February 21, 2008, the Oklahoma Tax Commission (OTC) 
issued an assessment of corporate income tax, penalties, and interest against 
Scioto totaling $546,644.00. A revised assessment was issued on October 5, 2009, 
in the amount of $434,361.00.7 Scioto filed a protest, alleging the company lacked 
minimum contacts with the State of Oklahoma and that levying a tax constituted a 
violation of the Commerce Clause.
DUE PROCESS CLAUSE
¶6 In its first assignment of error, Scioto argues that the OTC corporate tax 
assessment is a violation of the Due Process Clause of the United States 
Constitution because the company lacks minimum contacts with Oklahoma. In 
Quill Corp. v. North Dakota By and Through Heitkamp, 504 U.S. 298, 
306, (1992), the Supreme Court defined the limitations placed on state taxing 
authorities by the Due Process Clause:
The Due Process Clause requires some definite link, some minimum connection, 
between a state and the person, property or transaction it seeks to tax, and 
that the income attributed to the state for tax purposes must be rationally 
related to values connected with the taxing State. (internal citations & 
quotations omitted).
However, physical presence is not mandatory to establish a constitutionally 
sufficient connection to meet the minimum contacts requirements of the Due 
Process Clause. When a taxpayer "purposefully avails itself of the benefits of 
an economic market," exercise of in personam jurisdiction will not offend 
due process, "even if [the taxpayer] has no physical presence in the state." 
Id. at 307-308. In this case, Scioto authorized the use of Wendy's 
intellectual property rights in all fifty (50) states, including Oklahoma. 
Scioto directed its activities at the residents of Oklahoma and benefitted from 
the economic contact created via the Wendy's name and proprietary information. 
To put it another way, every hamburger sold in Oklahoma by Wendy's had a direct 
economic benefit to Scioto.
¶7 The first state court case to address the interplay between the Due 
Process Clause and taxation of an out-of-state corporation's income attributable 
to intellectual property was decided by the South Carolina Supreme Court in 
Geoffrey, Inc. v. South Carolina Tax Comm'n, 437 S.E.2d 13 (S.C. 1993). 
Geoffrey, Inc. was an entity created and solely owned by Toys R Us, Inc. 
Id. at 15. The parent company transferred its intellectual property 
rights to Geoffrey, who in turn, allowed the toy company to utilize those rights 
and business know-how in exchange for a payment equal to one percent (1%) of net 
sales. Id. Toys R Us filed income tax returns, but offset its corporate 
revenue with a deduction equivalent to the one percent (1%) license fee paid to 
Geoffrey. Id. The South Carolina taxing authority issued an assessment, 
and Geoffrey protested. Id. Finding Geoffrey had a sufficient connection 
to the state, the court rejected any claim that taxation violated the Due 
Process Clause:
Geoffrey's business is the ownership, licensing, and management of 
trademarks, trade names, and franchises. By electing to license its trademarks 
and trade names for use by Toys R Us in many states, Geoffrey contemplated and 
purposefully sought the benefit of economic contact with those states. Geoffrey 
has been aware of, consented to, and benefitted from Toys R Us's use of 
Geoffrey's intangibles in South Carolina. Moreover, Geoffrey had the ability to 
control its contact with South Carolina by prohibiting the use of its 
intangibles here as it did with other states. We reject Geoffrey's claim that it 
has not purposefully directed its activities toward South Carolina's economic 
forum and hold that by licensing intangibles for use in South Carolina and 
receiving income in exchange for their use, Geoffrey has the minimum connection 
with this State that is required by due process.
Id. at 16. Geoffrey sought review in the United States Supreme Court; 
however, certiorari was denied. Geoffrey, Inc. v. South Carolina Tax 
Comm'n, 437 S.E.2d 13 (S.C. 1993), cert. denied 
510 U.S. 992 (1993).
¶8 Scioto intentionally placed Wendy's intellectual property in the stream of 
Oklahoma commerce, and purposefully sought the advantages of economic contact 
with our state. The income generated from restaurant sales in Oklahoma was 
recorded on the books of Oldemark. This economic presence was sufficient contact 
to satisfy the fundamental principles mandated by the Due Process Clause.
COMMERCE CLAUSE
¶9 Scioto also challenges Oklahoma's assessment of income tax based on an 
alleged violation of the Commerce Clause of the U.S. Constitution.8 Although review of the 
constitutional constraints on state income taxation under the Commerce Clause is 
similar to the analysis required by the Due Process Clause, the two are not 
identical. Quill, 504 U.S.  at 305. The validity of a state tax under the 
Commerce Clause is measured according to a four-part test: 
Under Complete Auto's four-part test, we will sustain a tax against a 
Commerce Clause challenge so long as the tax (1) is applied to an activity with 
a substantial nexus with the taxing State, (2) is fairly apportioned, (3) does 
not discriminate against interstate commerce, and (4) is fairly related to the 
services provided by the State.
Quill, 504 U.S.  at 311, (citing Complete Auto Transit, Inc. v. Brady, 
430 U.S. 274, 279, (1977)); see also In The Matter Of The Assessment 
Of Personal Property Taxes Against Missouri Gas Energy, A Division Of Southern 
Union Company, For Tax Years 1998, 1999, and 2000, 2008 OK 94, ¶ 43, 234 P.3d 938, 953. The first and 
fourth prongs of the Complete Auto analysis limit a state's ability to 
impose taxation which would burden interstate commerce. Quill, 
504 U.S.  at 313. The second and third requirements prohibit taxation that places an 
unfair share of the tax burden on interstate commerce. Id. 
¶10 Scioto suggests that taxation by Oklahoma would offend the protections 
provided by the Commerce Clause because the company lacks a substantial nexus 
with the state. The Oklahoma Court of Civil Appeals rejected the application of 
a bright-line physical presence requirement. Geoffrey, Inc., v. Oklahoma Tax 
Commission, 2006 OK CIV APP 
27, ¶ 19, 132 P.3d 632, 638-639 (declining to apply the physical presence test required for 
sales/use tax and finding the real source of the holding company's income was 
customers from Oklahoma).9 Since 1996, an OTC regulation put foreign corporations 
on notice that the licensing of intangible property rights in this state creates 
a nexus sufficient to subject the entity to income taxation.10 I agree with the Geoffrey analysis and would 
hold that the substantial nexus test was satisfied because Scioto's receipt of 
royalty income was directly connected to the use of its intellectual property in 
Oklahoma. The use of the Wendy's name and other intangibles in Oklahoma created 
an economic presence justifying taxation in this state. The majority of 
jurisdictions addressing the Commerce Clause and taxation of royalties received 
by an out-of-state holding company for use of the company's intellectual 
property have rejected the physical presence test and allowed imposition of 
state income tax based on an economic nexus.11 
¶11 Scioto also maintains that the income tax imposed by Oklahoma was not 
fairly apportioned. The OTC applied 68 O.S.Supp. 2010 § 2358(A)(5) and prior opinions 
from this Court to determine whether Scioto's income was derived from a unitary 
business enterprise. The OTC sufficiently established that Wendy's, Scioto, and 
Oldemark were part of a unitary business enterprise. The motivation behind this 
corporate anatomy was to shelter royalties generated from use of Wendy's 
trademarks and the company's proprietary information throughout the United 
States. The OTC correctly imposed corporate income tax.
CONCLUSION
¶12 Electronic commerce continues to expand, and increasingly, interstate and 
international businesses have significant economic impact in a state without 
having a physical presence. While new legal concepts are challenging established 
law, the taxation of intangibles is not a recent phenomenon. Oklahoma courts and 
the OTC are in harmony.12 Scioto intentionally placed its property into the 
stream of Oklahoma commerce, realizing the benefits and protections afforded by 
the people and laws of this state. The presence of Scioto's intellectual 
property within Oklahoma is a sufficient nexus for the imposition of corporate 
income taxes. As such, I would affirm the determination by the OTC and authorize 
the imposition of income tax against Scioto. 
FOOTNOTES
1 During oral argument, 
counsel for Scioto acknowledged the company has never paid an insurance 
claim.
2 Oldemark acquired the intellectual property rights 
through a series of corporate reorganizations, licensing agreements, and 
assignments, beginning in approximately 1989. 
3 It is undisputed that Oldemark was a disregarded entity 
under federal law -- meaning any tax obligation of the LLC became the 
responsibility of Scioto. Oklahoma follows the federal rule for tax treatment of 
a single member LLC. 68 O.S.2011 § 202(j). No error is alleged. 

4 Wendy's International, Inc. Franchise Offering Circular 
(2005) (emphasis added). This language would seem to create a direct connection 
between use of the intellectual property in Oklahoma through Oldemark and 
Scioto.
5 The dynamic behind this kind of corporate structuring 
to eliminate taxation was explained in a legal treatise:
One of the standard tax-planning devices corporations have employed to reduce 
taxable income in states where they conduct their operations is to transfer 
their trademarks or trade names to an intangibles holding company (IHC) and 
license back the trademarks or trade names for a royalty. The royalty, which is 
deductible to the operating company, reduces its income in the states where it 
carries on its business. The IHC, on the other hand, ordinarily pays no tax on 
its royalty income because it is taxable--or at least taxpayers so contend--only 
in a state that does not tax such income (e.g., Delaware).
J. Hellerstein & W. Hellerstein, State Taxation ¶ 9.20[7][j] (3d ed. 
2012).
6 Examining the precise tax scheme faced in this case, 
the South Carolina Supreme Court noted that the "net effect of this corporate 
structure has been the production of 'nowhere' income that escapes all state 
income taxation." Geoffrey, Inc. v. South Carolina Tax Comm'n, 437 S.E.2d 13, 15, n.1 (S.C. 1993) (citing Rosen, Use of a Delaware Holding Company to 
Save State Income Taxes, 20 Tax Adviser 180 (1989)).
7 This change reflected an adjustment to coincide with a 
federal amortization deduction. 
8 The Commerce Clause contains more than an affirmative 
grant of power; it also includes a negative component, often referred to as the 
dormant Commerce Clause. KFC Corp. v. Iowa Dept. of Revenue, 792 N.W.2d 308, 313 (Iowa 2010). This aspect of the clause has been construed as a limit on 
the power of states to impose taxes, even in the absence of affirmative acts of 
Congress. Id. 
9 By a vote of 7-1 this Court denied certiorari in 
Geoffrey v. Oklahoma Tax Commission, Supreme Court Case No. TC-99,938, on 
March 20, 2006.
10 Okla. Admin. Code § 710:50-17-3(10) (1996). The 
relevant section, titled "What constitutes 'Nexus,'" reads in relevant part:
If a corporation has one or more of the following activities in Oklahoma, it 
is considered to have "nexus" and shall be subject to Oklahoma income taxes:
(9) Leasing of tangible property and licensing of intangible rights for 
use in Oklahoma. (emphasis added).
Other states have enacted similar administrative regulations. see 
e.g., Fla. Admin. Code Ann. R. 12C-1.011(1)(p)(1)(2006); Iowa Admin. Code 
701-52.1(4)(422), Example 7 (Westlaw 2008); Mass. Dep't of Revenue, Corporate 
Excise DOR Directive 96-2, July 3, 1996.
11 See e.g., KFC v. Iowa Dept. of 
Revenue, 792 N.W.2d 308, 328 (Iowa 2010) (concluding Commerce Clause is not 
offended based on Iowa income tax on royalties earned by allowing use of 
intangibles within the State of Iowa); Geoffrey, Inc. v. Comm'r of 
Revenue, 899 N.E.2d 76, 92 (Mass. 2009) (applying substantial nexus test and 
rejecting Commerce Clause challenge based on income earned through use of 
intangible property in state); Lanco, Inc. v. Director, Div. of Taxation, 
879 A.2d 1234, 1242 (N.J. Super. Ct. App. Div. 2005) (finding physical presence 
of Delaware holding company was not mandatory to impose income tax associated 
with licensing fees attributable to intellectual property targeting New Jersey 
consumers); Geoffrey, Inc. v. South Carolina Tax Comm'n, 437 S.E.2d  at 
18-19 (holding that by licensing intangibles for use in South Carolina, holding 
company had substantial nexus, such that taxing royalties from intellectual 
property would not violate the dormant Commerce Clause); A&F Trademark, 
Inc. v. Tolson, 605 S.E.2d 187, 195 (N.C. Ct. App. 2004), cert. 
denied, 546 U.S. 821 (2005) (determining that "where a wholly-owned 
subsidiary licenses trademarks to a related retail company operating stores 
located within North Carolina, there exists a substantial nexus with the State 
sufficient to satisfy the Commerce Clause"); Tax Comm'r of State v. MBNA 
America Bank, 640 S.E.2d 226, 234 (W.Va. 2006) (rejecting physical presence 
test and noting such a rigid interpretation of the Commerce Clause "makes little 
sense in today's world"); Comptroller of the Treasury v. SYL, Inc., 825 A.2d 399, 415 (Md. Ct. App. 2003) (recognizing that entities holding 
intellectual property for parent company "had no real economic substance," and 
allowing taxation of a portion of income attributable to parent corporations' 
business in the state); see also Surtees v. VFJ Ventures, 
Inc., 8 So. 3d 950, 976-981 (Ala. Ct. App. 2008), cert. denied, 
129 S. Ct. 2051 (2009); Secretary, Dept. of Revenue, State of La. v. GAP 
(Apparel), Inc., 886 So. 2d 459, 462 (La. Ct. App. 2004); Bridges, 
Secretary of Dept. of Revenue, State v. Geoffrey, Inc., 984 So. 2d 115, 128 
(La. Ct. App. 2008).
12 see n.9 and n.10, 
supra.