California Court of Appeal

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Lucent Technologies v. State Bd. Equalization, B257808

In an by telecommunication action involving California's technology transfer agreement statutes, Rev, & Tax. Code sections 6011(c)(10) and 6012(c)(10), and a decision of the Board of Equalization assessing sales tax, the trial court's judgment finding the Board's findings as erroneous is affirmed where: 1) the manufacturer’s decision to give the telephone companies copies of the software on magnetic tapes and compact discs (rather than over the Internet) does not turn the software itself or the rights to use it into "tangible personal property" subject to the sales tax; 2) a “technology transfer agreement” within the meaning of sections 6011, subdivision (c)(10)(D) and 6012, subdivision (c)(10)(D), which exempts from the sales tax the intangible portions of a transaction involving both tangible and intangible property, can exist when the only intangible right transferred is the right to copy software onto tangible equipment, and 3) a technology transfer agreement can exist as long as the grantee of copyright or patent rights under the agreement thereafter copies or incorporates a copy of the copyrighted work into its product or uses the patented process, and any of these acts is enough to render the resulting product or process “subject to” the copyright or patent interest.

Appellate Information

  • Decided 10/08/2015
  • Published 10/08/2015




  • California Court of Appeal


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