J-A26035-21

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

RITE AID HEADQUARTERS 

CORPORATION

v.

BRINES REFRIGERATION HEATING & 

COOLING 

Appellant

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 IN THE SUPERIOR COURT OF

 PENNSYLVANIA

 No. 992 EDA 2021

Appeal from the Order Entered December 24, 2020

In the Court of Common Pleas of Philadelphia County Civil Division at 

No(s): 200401092

BEFORE: BOWES, J., STABILE, J., and McCAFFERY, J.

MEMORANDUM BY McCAFFERY, J.: FILED MARCH 8, 2022

Brines Refrigeration Heating & Cooling (Appellant) appeals from the 

order entered in the Philadelphia County Court of Common Pleas, denying its 

motion to stay proceedings concerning Rite Aid Headquarters Corporation’s 

(Rite Aid) complaint, or in the alternative, for a protective order to limit 

discovery. On appeal, Appellant claims the underlying case involves a claim 

for fraudulent collection of sales tax and therefore, it must be stayed until the 

applicable taxing authorities address the issue as required by Stoloff v. 

Neiman Marcus Group, Inc., 24 A.3d 366 (Pa. Super. 2011). Based on the 

following, we affirm.

The trial court set forth the relevant facts and procedural history, which 

were derived from the verified complaint, as follows:
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[Rite Aid] is a pharmacy chain with stores located 

throughout the United States including Pennsylvania. [Appellant]

is a commercial mechanical contractor that performs HVAC, 

lighting, refrigeration and other general services. From 2004 to 

2019, [Rite Aid] contracted with [Appellant] to perform various 

maintenance and related services at its various locations in more 

than 20 states, including Pennsylvania. During this time period, 

various contracts were executed by the parties which set forth the 

contractual relationship and obligations between [Rite Aid] and 

[Appellant]. Specifically, the 2010 Master Service Agreement 

[(“MSA”)] and the 2016 [MSA], in particular, required that 

[Appellant]’s invoices identify “state sales tax” when applicable.

Additionally, the 2013 HVAC Agreement also included a “Retail 

Facilities Invoice Procedure” which required that “All Invoices 

MUST list separately the overhead and profit rate and applicable 

sales or other tax, if any. Vendor shall be responsible for all 

collected taxes associated with paid invoices.” Furthermore, the 

2010 MSA, the 2016 MSA, the 2013 HVAC Agreement, Lighting 

Agreement and the 2018 HVAC Agreement also contain[ed] 

indemnification provisions and assurances that [Appellant] was in 

compliance with all current federal, state and local laws and 

regulations.

Since 2010, [Appellant] issued to [Rite Aid] more than 

150,000 invoices which include a line item change for either “tax”, 

“sales tax” and/or the name of the taxing juris[di]ction. At all 

times relevant hereto, [Rite Aid] paid [Appellant]’s invoices, 

including the line item charge for “tax”, “sales tax” and/or that 

contained the name of the taxing authority.[

1]

In January 2019, the PA Department of Revenue 

(“Department”) sent [Rite Aid] the results of a sales tax audit of 

[its] subsidiary Thrift Drug, Inc. covering the audit period of May 

1, 2015 to February 8, 2018. As a result of the audit, the 

Department assessed additional tax amounts in approximately 

177 invoices that [Rite Aid] received from [Appellant] during the 

relevant audit period for which the Department determined that 

[Rite Aid] had not paid any PA sales or use tax for the taxable 

service identified in [Appellant]’s invoices.

____________________________________________

1 Rite Aid purportedly paid Appellant “more than $5.1 million of ‘tax.’” 

Complaint, 4/22/2020, at 2.
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Also, in 2019, the Department began a separate sales audit 

of Rite Aid, Inc. [Rite Aid] retained Keystone Tax Associate’s, a 

sales and use tax consulting firm, to help in reviewing the sales 

and use tax Rite Aid paid to the Commonwealth of [Pennsylvania] 

and related issues. In November 2019, representatives from 

Keystone and Rite Aid met with the Department state tax auditors 

to discuss the preliminary assessment of use tax on Rite Aid of PA 

for the invoices issued by [Appellant] that included a “tax” line 

item. State auditors informed Rite Aid that the Department 

was unable to locate any record of [Appellant] being 

registered with or licensed by the Department to collect 

and remit PA sales tax. The State Auditors also informed 

[Rite Aid] that the Department did not have records of 

[Appellant] remitting any sales tax to the department. The 

Department also informed [Rite Aid] that they did not recognize 

the “tax” listed on the invoices issued by [Appellant] and paid by 

[Rite Aid] because unless [Appellant] was remitting the tax to the 

department using a different name, the tax listed on the invoice 

had not been remitted and was not a PA sales tax.

On January 23, 2020, during a call between representatives 

of [Rite Aid] and [Appellant], [Appellant] provided [Rite Aid] with 

the following information: 1) [Appellant] had not paid sales tax

for work performed in Pennsylvania to the Department or the tax 

authorities in other states and 2) the itemized “tax” listed on 

[Appellant]’s invoice was not actually a tax but some other charge 

by [Appellant]. [Appellant] did not explain what it claimed the 

line item stating “tax” represented.

The Department in connection with a closed audit, assessed 

[Rite Aid] use tax, interest and fines for the work performed by 

[Appellant]. In connection with an open audit, the Department 

has informed [Rite Aid] that it will be assessed additional use tax 

for work performed by [Appellant] even though [Rite Aid] paid the 

“tax” to [Appellant] for the work.

Trial Ct. Op., 7/28/21, at 1-4 (footnotes omitted; emphasis added).

In April 2020, Rite Aid instituted a lawsuit against Appellant, raising 

claims of breach of contract, fraud, unjust enrichment, and negligent 

misrepresentation based on its reliance that Appellant remitted the taxes 
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collected from Rite Aid to the proper state tax authorities. See Complaint, 

4/22/2020, at 1-15. Rite Aid sought damages for the money Appellant 

purportedly stole under the guise of a charge of “tax” on the invoices. Rite 

Aid also requested a declaratory judgment, seeking an order and judgment

stating it was “entitled to indemnification from [Appellant] for any actions by 

state tax authorities related to [Appellant]’s misconduct, including for any 

future tax liability, losses, damages, attorney’s fees, interest and any other 

cost Rite Aid may incur.” Id. at 16.

On September 9, 2020, Appellant filed a motion to stay proceedings

based on Stoloff, supra, or, in the alternative, for a protective order to limit 

discovery.2 Appellant alleged that Rite Aid requested these tax payments be 

returned but it could not do so based on the following assertion:

[O]nce taxes are collected by a seller like [Appellant], the taxes 

become the property of the state. [Appellant] cannot simply be 

ordered to pay the taxes back because the taxes would not belong 

to [Appellant]. They belong to the state. [Rite Aid]’s recourse 

[was] to seek redress with the state.

Appellant’s Motion to Stay Proceedings on Plaintiff’s Complaint and, in the 

Alternative, to Limit Discovery, 9/9/20, at 5 (citation omitted). Rite Aid 

____________________________________________

2

In addition to the motion to stay, Appellant filed one set of preliminary 

objections (POs) and two sets of amended POs. Rite Aid filed responses to the 

POs, its own POs to Appellant’s POs, and POs to Appellant’s answer, new 

matter, and counterclaim as well as its amended answer and new matter. 

Lastly, Rite Aid filed a motion for attorney fees.
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responded to the motion. The trial court reviewed the matter and denied 

Appellant’s motion to stay proceedings or limit discovery.3 

In January 2021, Appellant filed an application for an amendment of the 

court’s order denying its motion to stay on Rite Aid’s complaint to include 

language specified by 42 Pa.C.S. § 702(b),4thereby certifying the order for 

interlocutory appeal. Appellant alleged there was “substantial ground for 

disagreement on the controlling issue of law which need[ed], from a practical 

perspective, to be resolved before trial[.]” Appellant’s Application for an 

Amendment of the Court’s Order Denying Appellant’s Motion to Stay to Certify 

an Interlocutory Appeal, 1/19/2021, at ¶ 11. The trial court did not dispose 

of the motion within the required 30 days and therefore, the application was 

deemed denied pursuant to Pa.R.A.P. 1311.

____________________________________________

3 The court’s order was dated December 23, 2020, but docketed the following 

day. The court entered the order without an opinion.

4 Subsection 702(b) provides:

(b) Interlocutory appeals by permission. — When a court or

other government unit, in making an interlocutory order in a

matter in which its final order would be within the jurisdiction of

an appellate court, shall be of the opinion that such order involves

a controlling question of law as to which there is substantial

ground for difference of opinion and that an immediate appeal

from the order may materially advance the ultimate termination

of the matter, it shall so state in such order. The appellate court

may thereupon, in its discretion, permit an appeal to be taken

from such interlocutory order.

42 Pa.C.S. § 702(b).
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Appellant then filed a petition for permission to appeal with this Court 

pursuant to Rule 1311. In a per curiam order, this Court granted the petition 

on May 21, 2021. The matter is now before us.

Appellant presents the following issue for our review:

Whether a Common Pleas case involving a claim for fraudulent 

collection of sales tax must be stayed until the applicable taxing 

authorities address the issue as required by this Court’s opinion in 

Stoloff v. Neiman Marcus Group, Inc., 24 A.3d 366 (Pa. Super. 

2011)?

Appellant’s Brief at 2.

The crux of Appellant’s argument is that the present proceedings must 

be stayed pursuant to the doctrine of primary jurisdiction and this Court’s 

ruling in Stoloff “which requires the stay of any civil litigation of ‘any dispute’ 

regarding sales tax pending exhaustion of administrative remedies with the 

applicable taxing authority.” Appellant’s Brief at 4-5. Appellant avers:

This is, in part, because a seller collects sales tax as an 

agent for the taxing authority and holds the funds in trust for the 

taxing authority. This means a seller cannot simply return the 

funds to the purchaser. Once collected, sales taxes generally 

belong to the taxing authority and cannot be returned without 

proceedings involving the taxing authority.

Because Rite Aid alleges [Appellant] collected sales tax from 

it but failed to remit those taxes to the appropriate authorities, 

this Court should direct the trial court to stay all proceedings in 

the civil action until all required proceedings before the 

Pennsylvania Department of Revenue are concluded. As a matter 

of comity, the stay should also be applied until future proceedings 

before taxing authorities outside of the Commonwealth are 

concluded.

Id. at 5.
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Appellant further contends that the court’s decision was based on two 

erroneous grounds. Appellant’s Brief at 6. First, Appellant alleges that the 

court erred in concluding that there was “no allegation in the complaint, or 

reasonable inference, that the ‘tax’ is a sales tax or that [Appellant] is holding 

the tax in trust.” Id. (footnote omitted). In support of its assertion, Appellant 

points to paragraph 5 of Rite Aid’s complaint, which states that “[Appellant] 

collected ‘sales tax’ from Rite Aid and f[a]iled to remit it to taxing 

authorities[,]” and paragraph 67 which states “‘Rite Aid reasonably believed 

that the ‘tax’ listed in the invoice reflected sales tax.’” Id. (record citations 

omitted). Appellant asserts:

The trust fund aspect of Stoloff is not one that arises from 

the pleadings, it arises from the statute.6 Pennsylvania[’s] sales 

tax statute provides that any tax collected under color of the law 

is held in trust for the Commonwealth.7 The under color of law 

portion of the statute is particularly relevant because, as the trial 

court recognized, “[Rite Aid] is seeking a refund from [Appellant] 

for charging [Rite Aid] a ‘tax’ disguised as a sales tax. To the 

extent there is a dispute over whether the “tax” is sales tax or 

something “disguised” as a sales tax and collected under color of 

the law, the dispute must be resolved by the taxing authorities.

_______________________

6

If Stoloff is only implicated when the complaint allege[s]

the existence of a trust fund, a plaintiff could avoid Stoloff

by simply omitting a trust fund allegation.

7 72 P.S. § 7225 [(“All taxes collected by any person from 

purchasers in accordance with this article and all taxes 

collected by any person from purchasers under color of this 

article, including all taxes paid by any person who advertises 

or holds out or states, directly or indirectly, that such person 

will pay the tax for the purchaser, which have not been 

properly refunded by such person to the purchaser shall 

constitute a trust fund for the Commonwealth, and such 
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trust shall be enforceable against such person, his 

representatives and any person (other than a purchaser to 

whom a refund has been made properly) receiving any part 

of such fund without consideration, or knowing that the 

taxpayer is committing a breach of trust: Provided, 

however, That any person receiving payment of a lawful 

obligation of the taxpayer from such fund shall be presumed 

to have received the same in good faith and without any 

knowledge of the breach of trust. Any person, other than a 

taxpayer, against whom the department makes any claim 

under this section shall have the same right to petition and 

appeal as is given taxpayers by any provisions of this 

part.”)].

Appellant’s Brief at 6-7 (some footnotes omitted).

Second, Appellant complains the court erred in determining that “the

expertise of the taxing authorities is not required because Rite Aid is not

seeking a refund, [or] seeking the interpretation of any taxing regulations or

challenging any assessment.” Appellant’s Brief at 7 (footnote omitted). 

Appellant maintains this position was addressed by the Stoloff Court and

rejected because “once the consumer pays the tax, that amount effectively

becomes Commonwealth property[, and] it does not matter whether the

complaint alleges the funds are held in trust or not” or “whether the ‘tax’ was

sales tax or something else.” Appellant’s Brief at 7 (citation and internal

quotation marks omitted). Appellant postulates that the “point of Stoloff is

the plaintiff is required to first seek a refund from the taxing authorities.” Id.

Based on this theory, Appellant asserts the doctrine of primary

jurisdiction is invoked and requires a stay of the proceedings on Rite Aid’s

complaint as the Department has jurisdiction over matters involving
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Pennsylvania sales tax. See Appellant’s Brief at 8-12. Appellant also suggests

that the issues in the case are “complex and require the specialized

competence of the taxing authorities.” Id. at 13. Likewise, Appellant states

that the matter should be stayed until the conclusion of any required

proceedings in sister state jurisdictions. See id. at 20-26. Lastly, Appellant

contends that it may be subject to inconsistent rulings and duplicative liability

if the proceedings are not stayed. Id. at 27-28.

We begin with our standard of review in matters involving jurisdiction:

“[I]ssues concerning the jurisdiction of the trial court . . . present questions 

of law and are subject to [a] de novo [standard of] review.” Stoloff, 24 A.3d

at 369 (citation omitted).

[T]he doctrine of primary jurisdiction is concerned with promoting

proper relationships between the courts and administrative

agencies charged with particular regulatory duties. Primary 

jurisdiction applies where a claim is originally cognizable in the 

courts, and comes into play whenever enforcement of the claim 

requires the resolution of issues which, under a regulatory 

scheme, have been placed within the jurisdiction of an 

administrative body; in such a case the judicial process is 

suspended pending referral of such issues to the administrative 

body for its views. 

Ciamaichelo v. Independence Blue Cross, 909 A.2d 1211, 1218 (Pa. 

2006), citing Elkin v. Bell Telephone Company of Pennsylvania, 420 

A.2d 371 (Pa. 1980).

The doctrine serves several purposes, chief of which are the

benefits to be derived by making use of the agency’s special

experience and expertise in complex areas with which judges and

juries have little familiarity. Another important consideration is

the statutory purpose in the creation of the agency ─ the powers
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granted by the legislature and the powers withheld. And, another

fundamental concern is the need to promote consistency and

uniformity in certain areas of administrative policy. . . .

It is equally important to realize what the doctrine is not-it 

is not simply a polite gesture of deference to the agency seeking 

an advisory opinion wherein the court is free to ignore the 

agency’s determination. Rather, once the court properly refers a 

matter or a specific issue to the agency, that agency’s 

determination is binding upon the court and the parties (subject, 

of course, to appellate review through normal channels), and is 

not subject to collateral attack in the pending court proceeding.

* * *

We must enter a caveat, however. Courts should not be too 

hasty in referring a matter to an agency, or to develop a 

“dependence” on the agencies whenever a controversy remotely 

involves some issue falling arguably within the domain of the 

agency’s “expertise.” “Expertise” is no talisman dissolving a 

court’s jurisdiction. Accommodation of the judicial and 

administrative functions does not mean abdication of judicial 

responsibility. The figure of the so-called “expert” looms 

ominously over our society – too much so to permit the roles of 

the court and jury to be readily relinquished absent a true 

fostering of the purposes of the doctrine of primary jurisdiction.

Therefore, where the subject matter is within an agency’s 

jurisdiction and where it is a complex matter requiring special 

competence, with which the judge or jury would not or could not 

be familiar, the proper procedure is for the court to refer the 

matter to the appropriate agency. Also weighing in the 

consideration should be the need for uniformity and consistency 

in agency policy and the legislative intent. Where, on the other 

hand, the matter is not one peculiarly within the agency’s area of 

expertise, but is one which the courts or jury are equally wellsuited to determine, the court must not abdicate its responsibility. 

In such cases, it would be wasteful to employ the bifurcated 

procedure of referral, as no appreciable benefits would be 

forthcoming.

Elkin, 420 A.2d at 376-77 (citations and footnotes omitted). 
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Lastly, “we look to the plaintiff’s allegations, not to the form of the 

pleading or the cause(s) of action asserted, to determine whether the doctrine 

of primary jurisdiction applies.” Erie Ins. Exch. V. Pa. Ins. Dep’t, 133 A.3d 

102, 108 (Pa. Commw. 2016).

5

With these principles concerning the doctrine of primary jurisdiction in 

mind, we now turn to the case relied on by Appellant, Stoloff. There, the 

appellant-buyer filed a class action lawsuit against the appellee-department 

store, which arose from her purchase-by-phone of a dress from the store’s 

catalog, to which the appellee-department store added a 6% sales tax. 

Stoloff, 24 A.3d at 368. 

In their complaint, [the a]ppellants insisted that [the appelleedepartment store] regularly required its Pennsylvania customers 

to pay a sales tax on clothing, even though most articles of 

clothing are not subject to the Pennsylvania tax. As a result, [the 

a]ppellants filed a class-action complaint against [the appelleedepartment store], alleging breach of contract, unjust enrichment, 

violation of the consumer protection law, and conversion, in 

addition to seeking injunctive relief.

Id. (footnote omitted).

The appellee-department store filed preliminary objections claiming the 

trial court lacked subject-matter jurisdiction. See Stoloff, 24 A.3d at 368. 

Following a hearing on the matter, at which the court was in receipt of an 

____________________________________________

5 We note we are not bound by the decisions of the Commonwealth Court. 

IRS v. Blue Mountain Ministry, Inc., 265 A.3d 824, 828 n.3 (Pa. Super. 

2021). Nevertheless, this decision is persuasive authority and helpful in our 

review of the issue presented. 
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advisory opinion by the Pennsylvania Department of Revenue, the trial court 

determined the appellants did not exhaust their administrative remedies, 

thereby depriving it of subject matter jurisdiction. See id. The appellants

filed an appeal, arguing that the court erroneously limited the scope of its 

jurisdiction based on the following: (1) the Pennsylvania Supreme Court 

provided broad jurisdiction to the trial courts; and (2) they were “not filing an 

action against a government entity, but rather a private entity [and therefore,]

their claims were not subject to the statutes governing tax-refund claims from 

this Commonwealth”. See id. at 368-69.

In reversing the trial court’s decision, a panel of this Court held that any 

dispute involving the payment of sales tax must first be resolved by the 

Department and found the doctrine of primary jurisdiction applied,6 opining:

[The a]ppellants rely on Section 7225 for the proposition 

that “private parties have a duty to refund improperly collected 

taxes,” and the apparent proposition that the Court of Common 

Pleas properly has primary jurisdiction in this case. [The 

a]ppellant’s interpretation of Section 7225 is misplaced. Section

7225 unambiguously states anyone who collects taxes that have

not been properly refunded to a purchaser must hold such amount

in a trust fund for the Commonwealth. 72 P.S. § 7225. This

language does not elevate a purchaser to the status of a private

party who may bypass administrative remedies. Reading Sections

7225 and 7252 together, we determine that once a purchaser

pays the seller a tax, whether properly or improperly imposed,

that tax effectively becomes Commonwealth property, whether

the seller transfers it to the Commonwealth or holds it in a trust

fund for the Commonwealth. See 72 P.S. § 7225 (directing that 

____________________________________________

6

In conjunction with determining the doctrine of primary jurisdiction applied, 

the panel concluded the trial court erred in dismissing the complaint for lack 

of subject matter jurisdiction. Stoloff, 24 A.3d at 368. 
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all taxes not transferred to the Commonwealth must be held in a 

trust fund); 72 P.S. § 7252 (stating that the Department shall 

refund all taxes paid improperly to the Commonwealth). 

Accordingly, even if [the appellee-department store] failed to 

forward the collected tax to the Commonwealth, it was required 

to hold, in a trust fund for the Commonwealth, any tax paid by a 

purchaser. See 72 P.S. § 7225. Alternatively, if [the appelleedepartment store] did forward the collected tax to the 

Commonwealth, then Sections 7252 and 7253 unambiguously 

dictate that Appellants must seek a remedy with the Department. 

See 72 P.S. §§ 7252, 7253.

In either scenario, once the consumer pays the tax, that

amount effectively becomes Commonwealth property. The

Department is thus in the best position to determine whether [the

appellee-department store] appropriately taxed the instant

consumers, as it customarily handles the overwhelming majority

of, if not all, such claims. In fact, Section 7253 mandates that the 

Department cannot authorize a refund of improperly collected 

taxes unless the taxpayer has filed a petition for refund with the 

Department. See 72 P.S. § 7253(a).

In light of the fact that the taxes paid by the instant

consumers are currently in the Department’s possession, whether

in actuality or in trust, we consider the issue of whether the tax

was properly assessed to be within the Department’s jurisdiction

and well-within its expertise.

Stoloff, 24 A.3d at 372-73 (footnotes and some citations omitted)).

Turning to the present matter, the trial court first looked to the 

allegations made in Rite Aid’s complaint, finding:

[I]t is clear the doctrine of primary jurisdiction does not apply.

[Rite Aid] brings this action against [Appellant] for breach of 

contract and fraud arising from [Appellant]’s alleged improper 

collection of a “tax” and its alleged false representation that the 

“tax” collected would be remitted to the proper authorities. There 

is no allegation or reasonable inference that can be drawn from 

the complaint that [Appellant] is holding the “tax” in trust for the 

Department or that the “tax” was a sales tax. In fact, it is alleged 

that [Appellant] is not licensed or registered with the Department 

and therefore could not remit the required sales tax charges. 
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This action was instituted by [Rite Aid] to recoup the 

allegedly unauthorized line item charge that [Appellant] imposed 

upon [Rite Aid].

24

 [Rite Aid] is not asking for the Department to 

assess sales or use tax on [it] or [Appellant]. The assessment has 

already been made by the Department since the “tax” charged on 

the invoice is not recognized as a sales tax by the Department. 

[Rite Aid] is not asking for a refund, asking an interpretation of 

any tax regulations nor challenging any tax assessment from the 

Department. [Rite Aid] is seeking recourse against [Appellant] for 

its allegedly improper actions independent of the Department’s 

role and on matters which are properly within the expertise of this 

court. Since the expertise of the Department is not implicated, 

the doctrine of primary jurisdiction does not apply.

_______________________

24

 [Appellant] makes various statements regarding what 

the line item “tax” represents. [Appellant] stated that the 

“tax” listed on the invoice issued to Rite Aid “was not 

Pennsylvania sales tax paid by [Rite Aid] to [Appellant]” but 

rather was the reimbursement of the sales tax paid by 

[Appellant] to [its] own vendors and then passed onto [Rite 

Aid] as a cost of the goods sold to [Rite Aid].

Trial Ct. Op. at 6-7 (some footnotes and record citation omitted).

The trial court further found that Stoloff was distinguishable from the 

present matter, explaining:

[Rite Aid] is not seeking a tax refund from the Department of 

Revenue or from an entity holding the tax in trust for the 

Department. [Rite Aid] is seeking a refund from [Appellant] for 

charging [it] a “tax” disguised as a sales tax. The Department of 

Revenue’s expertise is not required in this action and the doctrine 

of primary jurisdiction does not apply. 

Trial Ct. Op. at 8.

Based on the circumstances before us, we agree with the trial court that 

the doctrine of primary jurisdiction is not applicable and Stoloff is 

distinguishable from the present matter for several reasons. First, Appellant 
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conflates that fact that this case touches upon the failure of a party to pay a 

tax with the notion that any litigation, or even any allegation, related to a tax

issue must fall under the umbrella of the Department. Likewise, Appellant 

repeatedly misconstrues Rite Aid’s cause of action as a mere refund for the 

paid “taxes.” Rather, this matter concerns Rite Aid’s reliance on Appellant’s 

statements that the taxes, which it listed on its invoices and requested Rite 

Aid pay, was ostensibly being collected and forwarded to the Department for 

tax purposes. Rite Aid further alleged Appellant either fraudulently or 

negligently mispresented this information because the money paid was never 

deposited with the Department as a “tax.”

This leads us to our second point. Appellant focuses on two paragraphs 

of an 89-paragraph complaint to support its argument that Rite Aid did allege 

in its complaint that (1) the “tax” at issue was a sales tax; and (2) that 

Appellant was holding the tax in trust. Rather, when looking at the complaint 

in toto, this was not the case. Rite Aid’s complaint focused on a fraudulent 

scheme as directed by Appellants. It specifically alleged that Appellant issued 

numerous invoices to Rite Aid, which included a line item charge for “tax” in 

connection with Appellant’s work, which Rite Aid paid directly to Appellant. 

Rite Aid’s Complaint at 2. Rite Aid then averred Appellant failed to remit that 

money to the proper tax authorities in Pennsylvania. See id. It further 

alleged:

35. In 2019, in connection with a tax audit by the PA Department 

of Revenue, Rite Aid learned that [Appellant] had not remitted to 
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the PA Department of Revenue the taxes [Appellant] had collected 

from Rite Aid for work [Appellant] had performed in Pennsylvania. 

In fact, according to the PA Department of Revenue, [Appellant] 

was not registered with the PA Department of Revenue and did 

not have a Pennsylvania sales tax license, in violation of 

Pennsylvania law. Without a valid sales tax license, a vendor 

cannot remit the required sales tax charges, as required by 

Pennsylvania law.

36. Because [Appellant] failed to remit the sales tax it collected, 

the PA Department of Revenue has informed Rite Aid that it is 

assessing a use tax on Rite Aid for its transactions with [Appellant] 

during the audit period.

37. Upon learning that [Appellant] was not registered for sales 

tax with the PA Department of Revenue and had never remitted 

to the PA Department of Revenue the sales tax it had collected 

from Rite Aid in Pennsylvania, Rite Aid’s representatives 

attempted to contact [Appellant] on or about November 25, 2019, 

December 3, 2019, December 9, 2019, December 13, 2019 and 

January 3, 2020.

38. After repeatedly failing to respond to Rite Aid’s attempts to 

get information about the sales tax collected by [Appellant], [its]

representatives agreed to have a call with Rite Aid’s 

representatives on or about January 15, 2020.

39. On the January 15, 2020 call, when Rite Aid’s representatives 

asked for information related to [Appellant’s] collection and 

remittance of sales tax in Pennsylvania, [Appellant’s] 

representatives ─ includ[ing] [Appellant’s] president Marty Brin ─ 

refused to answer Rite Aid’s questions, claiming that they were 

waiting to hear from their accountants and attorneys.

40. On or about January 23, 2020, Rite Aid’s representatives had 

another call with representatives of [Appellant], including Marty 

Brin and an attorney representing [Appellant]. On that call, 

[Appellant’s] representatives informed Rite Aid that [it] had not 

paid sales tax for work performed in Pennsylvania to the PA 

Department of Revenue or to the tax authorities in other states. 

Instead, [Appellant’s] representatives falsely claimed ─ in direct 

contradiction with the unequivocal language in [Appellant’s] own 

invoices and requirements in the Agreements between Rite Aid 

and [Appellant] ─ that the itemized “tax” listed on [its] invoices 
J-A26035-21

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was not actually a tax, but some other charge by [Appellant]. 

Unsurprisingly, [Appellant] could not explain what the “tax” 

charges were.

41. Based on [Appellant’s] representations on January 23, 2020 

that the itemized “tax” listed on [its] invoices was not actually a 

tax, [Appellant] has not remitted the tax it collected from Rite Aid 

to any state tax authorities and now falsely claims that the 

itemized “tax” on [its] invoices did not reflect a tax.

Id. at 7-9.

Based on these averments, it is evident that Rite Aid was not merely 

claiming the parties’ conflict involved a tax refund issue and that Appellant 

had placed the paid taxes in a trust fund. It is clear Rite Aid was alleging

Appellant purportedly committed fraud or some other tortious action because 

it had not remitted the taxes to Department that it collected from Rite Aid, 

and that it could not even do so because it was not registered with Department 

and did not have a Pennsylvania sales tax license. Furthermore, the complaint 

also indicated that Appellant had subsequently changed its position and was 

now alleging that the itemized “tax” listed on the invoices was not actually a 

tax, but rather, some other charge. Accordingly, Appellant’s argument has no 

merit.

Moreover, Appellant’s reliance as Stoloff is misplaced for several 

reasons. One, the appeal issue does not concern a request for a refund of 

taxes already paid to the Department. Two, the appellants in Stoloff never 

asserted that the appellee-department store did not keep the taxes at issue 

in a trust fund for tax purposes as is the case here. Three, the appellants did 
J-A26035-21

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not set forth causes of action for fraud and negligent misrepresentation like 

Rite Aid did in its complaint. Lastly, in its brief, Appellant does not allege the 

money collected is being kept in a trust fund for tax purposes in accordance 

with the Sections 7225 and 7252. Therefore, contrary to Appellant’s argument

Stoloff is not controlling in this appeal.

In sum, we conclude the trial court did not err in denying its motion to 

stay proceedings concerning Rite Aid’s complaint, or in the alternative, for a 

protective order to limit discovery, as it had jurisdiction to review the matter.

Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 3/8/2022