TracFone Wireless, Inc. v. County of Los Angeles

INTRODUCTION

Appellant TracFone Wireless, Inc. (TracFone), paid the County of Los Angeles (County) use taxes from its own funds, and later sought a refund when it determined that the long distance service it provided was tax exempt. Respondent County refused the request for a refund, and this action ensued. The trial court held that appellant lacked standing, because it was the service provider responsible for collecting the tax from the consumer, and thus not the intended “taxpayer” under the Los Angeles County Code section imposing the tax. The trial court also held that the first amended complaint (FAC) failed to state a cause of action for a tax refund, because appellant had paid the tax voluntarily. We hold that appellant’s payment of the tax conferred standing, and that the FAC adequately alleged an involuntary payment. Accordingly, we reverse the judgment.

BACKGROUND

The FAC alleged that TracFone was a Florida corporation in the business of selling prepaid telephone calling cards throughout the United States, including California, for use in cellular telephones also sold by TracFone. The cards provided access to a national telephone network, allowing callers to…