California Trial Court Denies FTB’s Motion to Vacate and Modify Judgment that Declared Technical Advice Memorandum 2022-01 and FTB Publication 1050 Invalid



A California trial court denied the Franchise Tax Board’s (FTB) motion to vacate and modify the judgment declaring FTB Technical Advice Memorandum (TAM) 2022-01 and FTB Publication 1050 invalid underground regulations adopted in violation of the Administrative Procedure Act.


Seeking to limit the scope and effect of the court’s judgment, the FTB’s motion to vacate objected to language in the judgment stating that “TAM [2022-01] and Publication 1050 are … declared void and without force or effect, and their guidance may not be relied upon.” The court disagreed with the FTB’s argument that this language contradicts California Supreme Court precedent. The FTB also sought to strike language in the judgment declaring the American Catalog Mailers Association (ACMA) the prevailing party. In an accompanying order, the court held the ACMA is the prevailing party and granted the ACMA costs and attorneys’ fees.

In all likelihood, this latest ruling will bring the trial court proceedings to a close. As we discussed in an earlier blog post about this case, whether the FTB appeals this loss is an interesting question because such an appeal could result in a broader invalidation of all the FTB’s TAMs and Publications.

American Catalog Mailers Association v. Franchise Tax Board, Case No. CGC-22-601363.