11-2140
     Media Space, Inc. v. Commissioner of Internal Revenue

                          UNITED STATES COURT OF APPEALS
                              FOR THE SECOND CIRCUIT

                                     SUMMARY ORDER
     RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED
     ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
     PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
     DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
     ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST
     SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

 1            At a stated term of the United States Court of Appeals
 2       for the Second Circuit, held at the Daniel Patrick Moynihan
 3       United States Courthouse, 500 Pearl Street, in the City of
 4       New York, on the 13th day of September, two thousand twelve.
 5
 6       PRESENT: DENNIS JACOBS,
 7                              Chief Judge,
 8                GUIDO CALABRESI,
 9                SUSAN L. CARNEY,
10                              Circuit Judges.
11
12       - - - - - - - - - - - - - - - - - - - -X
13       MEDIA SPACE, INC.,
14                Petitioner-Appellee,
15
16                    -v.-                                               11-2140
17
18       COMMISSIONER OF INTERNAL REVENUE,
19                Respondent-Appellant.
20       - - - - - - - - - - - - - - - - - - - -X
21
22       FOR APPELLANT:                        Arthur T. Catterall, for Dept.
23                                             of Justice - Appellate
24                                             Section/Tax Division,
25                                             Washington, D.C.
26
27


                                                  1
 1   FOR APPELLEES:                Dustin F. Hecker, Posternak
 2                                 Blankstein & Lund LLP, Boston,
 3                                 MA.
 4
 5        Appeal from an order of the United States Tax Court
 6   (Goeke, J.).
 7
 8        UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED
 9   AND DECREED that the order of the Tax Court is VACATED and
10   the case is REMANDED with instructions to dismiss.
11
12        The Commissioner appeals the Tax Court’s order allowing
13   Media Space to partially deduct forbearance payments as
14   ordinary and necessary business expenses in its 2004 and
15   2005 tax returns. We assume the parties’ familiarity with
16   the underlying facts, the procedural history, and the issues
17   presented for review.
18
19   [1] As Media Space represented in its April 4, 2012 filing
20   with this Court, “Media Space paid the full amount due with
21   respect to the tax years at issue on this appeal in
22   September 2011.” Notice of Payment of Amounts at Issue on
23   Appeal and, Alternatively, Request to Postpone Oral Argument
24   (Dkt. No. 98) (Apr. 4, 2012). Because Media Space’s alleged
25   tax deficiencies have been paid in full, no case or
26   controversy exists and this case is moot. See, e.g.,
27   Camreta v. Greene, 

, 2028 (2011).
28
29   [2] The Commissioner argues that this Court should
30   nonetheless address the legal questions presented in this
31   appeal. We decline to do so, because a federal court may
32   not “decide the merits of a legal question not posed in an
33   Article III case or controversy.” U.S. Bancorp Mortg. Co.
34   v. Bonner Mall P’ship, 

, 21 (1994).
35
36   [3] When a case is moot on    appeal, the “established
37   practice” of federal courts   is to “vacate the judgment below
38   and remand with a direction   to dismiss.” United States v.
39   Munsingwear, Inc., 

, 39 (1950); see also Russman
40   v. Bd. of Educ. of Enlarged   City Sch. Dist., 

,
41   121 (2d Cir. 2001).
42
43
44
45



                                    2
 1        Finding no merit in the Commissioner’s remaining
 2   arguments, we hereby VACATE the order of the Tax Court and
 3   REMAND the case with instructions to dismiss the petition.
 4
 5
 6                              FOR THE COURT:
 7                              CATHERINE O’HAGAN WOLFE, CLERK
 8
 9
10
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12




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