Featured Chrome Extensions:

Casey IRACs are produced by an AI that analyzes the opinion’s content to construct its analysis. While we strive for accuracy, the output may not be flawless. For a complete and precise understanding, please refer to the linked opinions above.

Keywords

statuteappeal
statutecopyrightappellant

Related Cases

Des Moines Coalition for the Homeless v. Des Moines City Bd. of Review, 493 N.W.2d 860
View Case »
Master Hatcheries, Inc. v. Coble, 286 N.C. 518, 212 S.E.2d 150
View Case »
Madden v. Commonwealth of Kentucky, 309 U.S. 83, 60 S.Ct. 406, 84 L.Ed. 590, 125 A.L.R. 1383
View Case »
Craig-Tourial Leather Co. v. Reynolds, 87 Ga.App. 360, 73 S.E.2d 749
View Case »
N.L.R.B. v. Yeshiva University, 444 U.S. 672, 100 S.Ct. 856, 63 L.Ed.2d 115, 103 L.R.R.M. (BNA) 2526, 87 Lab.Cas. P 11,819
View Case »
Justia Law Link
LexisNexis Link
Westlaw Link
CourtListener Link
Oyez Link

WDKY-TV, Inc. v. Revenue Cabinet, Com. of Ky., 838 S.W.2d 431, 20 Media L. Rep. 1507

Facts

WDKY-TV, Inc. is an independent television station in Lexington, Kentucky, that broadcasts syndicated programs obtained through licensing agreements with syndicators outside the Commonwealth. WDKY acquires the right to broadcast programs either through satellite or videotape transmission. While WDKY pays use tax on the tangible videotapes, the Revenue Cabinet assessed use tax on the value of the intangible broadcast rights, leading to the legal dispute.

Appellant WDKY–TV is an independent television station in Lexington, Kentucky. WDKY primarily broadcasts syndicated programs obtained through syndicators located outside the Commonwealth. By entering into licensing agreements with the syndicators, WDKY receives the exclusive right to broadcast a program in WDKY's market area for a limited number of times over a specified period of time.

Issue

Whether the purchase of television broadcasting rights may lawfully be taxed under Kentucky's Use Tax statute, KRS 139.310.

The issue before this Court is whether television broadcasting rights may lawfully be taxed under Kentucky's Use Tax statute, KRS 139.310, which imposes a tax on the storage, use, or other consumption in this state of tangible personal property.

Rule

The court held that the right to broadcast television programs is not tangible personal property within the meaning of KRS 139.310, which imposes a tax on the storage, use, or other consumption in this state of tangible personal property.

For the reasons set out below, we hold that the right to broadcast television programs is not tangible personal property within the meaning of the statute.

Analysis

The court analyzed the definitions of tangible personal property and the nature of the rights being taxed. It concluded that the Revenue Cabinet had misconstrued the applicable statutes by attempting to tax intangible property rights associated with the transfer of tangible property. The court emphasized that the right to broadcast is distinct from the tangible videotapes and that the legislature had not explicitly expressed an intention to tax such intangible rights.

In this case, the Revenue Cabinet has misconstrued the applicable statutes and misapplied them to the facts. The statutes purport to place a tax based on the 'sales price' of 'tangible personal property.' KRS 139.310. 'Tangible personal property' means personal property which may be seen, weighed, measured, felt or touched, or which is in any other manner perceptible to the senses…. KRS 139.160.

Conclusion

The Court of Appeals reversed the decision of the Franklin Circuit Court and remanded the case for further proceedings, stating that the Revenue Cabinet may tax the value of the videotapes themselves but not the intangible broadcast rights.

The judgment is reversed and remanded for further proceedings in conformity with this Opinion in order for the Revenue Cabinet to make a proper assessment of the value of the tape itself and services involved in putting the images on the tape.

Who won?

WDKY-TV, Inc. prevailed in the case because the court found that the Revenue Cabinet's assessment of use tax on broadcast rights was not supported by the law.

The Revenue Cabinet concedes that, by itself, the right to broadcast copyrighted material is an intangible property right and not subject to the statute. We agree with that position.

You must be