Supreme Court Decision Alert - December 3, 2013

Yesterday (December 3, 2013) the Supreme Court issued two decisions, described below, of interest to the business community.

• Taxation—Penalties for Overstating Basis—District Court Jurisdiction
• Forum-Selection Clauses—Proper Venue—Transfer Between Districts

Taxation—Penalties for Overstating Basis—District Court Jurisdiction

United States v. Woods, No. 12-562 (previously discussed in the March 25, 2013, Docket Report)

Section 6662(e) of the Internal Revenue Code imposes a penalty for an underpayment of income tax that is "attributable to" an overstatement of the value or basis of property. Today, the Supreme Court, in a unanimous opinion by Justice Scalia, held that the overstatement penalty is applicable to an underpayment resulting from a basis-inflating transaction subsequently disregarded for lack of economic substance. The Court also decided that district courts have jurisdiction to consider the applicability of tax penalties in