US: Microsoft sues IRS over hiring of antitrust attorney Boies

Microsoft filed another suit against the US Internal Revenue Service, seeking information about the tax agency’s decision to hire outside lawyers, including one-time Microsoft nemesis David Boies, to help conduct an audit of the company. David Boies is the lawyer who beat Microsoft in an antitrust case in 2000.

The lawsuit, which was filed Friday in the U.S. District Court for the Western District of Washington, seeks information from the IRS about contracts it made with two high-powered law firms to investigate Microsoft. What sparked the case are a pair of Freedom of Information Act (FOIA) requests the company made regarding deals with Quinn Emanuel Urquhart & Sullivan, LLP and Boies Schiller & Flexner, LLP.

The extensive audit by the IRS stems over how tax is calculated for income made by Microsoft overseas, including its transfer prices to local affiliates in Bermuda and Puerto Rico. Retaining profits abroad is a common practice that can lower a U.S.-based company’s tax burden.

According to the complaint, Boies Schiller was awarded a $350,000 contract in 2013 to provide legal services to the IRS in connection with its audit of Microsoft. David Boies, the firm’s chairman, who’s known for his role as the lead prosecutor in the U.S. Justice Department’s antitrust suit against Microsoft, was named as lead counsel in the contract.

Full content: Bloomberg

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