Insights

In its April 21, 2026, opinion, the U.S. Court of Appeals for the Tenth Circuit affirmed the lower court’s ruling in Liberty Global, holding that the codified economic substance doctrine applies even when a taxpayer mechanically utilizes the provisions of the Tax Code. The court also held that common mergers and acquisitions elements and basic business transactions are not categorically carved out from the economic substance doctrine. The court dismissed the taxpayer’s argument that a separate relevancy determination needs to be made before the economic substance doctrine can be applied.

In Trump v. CASA, the Supreme Court significantly constrained the equitable authority of federal district courts to grant universal or nationwide injunctive relief, clarifying that, with specific exceptions, a federal court’s power to grant relief is limited to the parties before it. When it was issued, many bemoaned CASA’s implications for preventing government overreach.

In October 2025, the Second Circuit addressed a recurring procedural issue: the standard of review district judges must apply to objections to magistrate judge reports and recommendations (“R&Rs”) on dispositive motions. In Nambiar v. The Central Orthopedic Group, LLP, the Second Circuit clarified that district judges are required to conduct a de novo review of any portion of an R&R to which a party has made timely and specific objections—even when those objections restate arguments previously made before the magistrate judge. This decision resolves confusion stemming from district courts that have limited de novo review to "new" arguments, and it sets clear expectations for how parties should challenge R&Rs going forward.