Microsoft Corporation, petitioner-appellant, v. Commissioner of Internal Revenue, respondent-appellee. On appeal from the United States tax court brief of Tax Executives Institute, Inc. as amicus curiae in support of reversal. (In The United States Court Of Appeals For The Ninth Circuit).

On December 20, 2001, Tax Executives Institute filed brief amicus curiae with the U.S. Court of Appeals for the Ninth Circuit in Microsoft Corporation v. Commissioner (No. 01-71584). The brief was prepared under the aegis of the Institute's IRS Administrative Affairs Committee, whose chair is David L. Bernard of Kimberly-Clark Corporation.

Interest of Amicus Curiae

Pursuant to Rule 29 of the Rules of the United States Court of Appeals for the Ninth Circuit, Tax Executives Institute, Inc. (TEI) respectfully submits this brief as Amicus Curiae to urge the reversal of the decision of the United States Tax Court and limit the deference afforded the temporary regulation at issue here.

TEI is a voluntary, nonprofit association of corporate tax executives who are responsible for managing the tax affairs of their companies and who must contend daily with the provisions of the tax law relating to the operation of business enterprises. The Institute was organized in New York in 1944 and has more than 5,200 members who represent nearly 2,800 of the leading corporations in the United States, Canada, and Europe. TEI is dedicated to promoting the uniform and equitable enforcement of tax laws throughout the nation and to reducing the costs and burdens of compliance to the benefit of both the government and taxpayers.

This case raises a fundamental question of administrative law: To what extent should a court defer to a temporary tax regulation? In its decision below, the Tax Court held -- without discussion -- that "[g]enerally, temporary regulations have binding effect and are entitled to the same weight as final regulations." Slip Op. at 32 (citations omitted). The court's opinion was issued, however, before the Supreme Court of the United States issued its opinion in United States v. Mead Corporation, 121 S. Ct. 2164 (2001), relating to the deference to be afforded Customs classification rulings and other interpretative rules. Amicus TEI submits that under Mead temporary regulations are not entitled to the same weight as final regulations. Instead, temporary regulations should be scrutinized under the standard enunciated by the Supreme Court in Skidmore v. Swift & Co, 323 U.S. 134 (1944).

This case is clearly important to companies that export products from the United States. Moreover, it presents an opportunity for this Court to apply Mead's deference standard to temporary regulations. As the individuals who must contend daily with the interpretation and administration of the nation's tax laws, TEI's members have a vital interest in the deference to be accorded IRS interpretative rules by the courts. Meaningful, albeit measured, judicial review of agency interpretative rulings is critical in safeguarding the public from unreasonable agency actions. Because TEI members and the businesses by which they are employed will be materially affected by the Court's decision in this case, the Institute has a special interest in the outcome.

Summary of Argument

The substantive tax issue in this case is the definition of the term "export property" for purposes of the Internal Revenue Code's foreign sales corporation (FSC) provisions. Specifically, the U.S. Tax Court considered whether Microsoft Corporation's computer software "masters" constitute "export property" within the meaning of section 927(a) of the Code (26 U.S.C.) and Temp. Reg. [section] 1.927(a)-1T(f)(3) (26 C.F.R.). In reaching its decision that computer masters are not "export property," the court upheld the validity of the temporary regulation, concluding -- without discussion -- that "[g]enerally, temporary regulations have binding effect and are entitled to the same weight as final regulations." Slip. Op. at 32 (citations omitted). Amicus Tax Executives Institute submits that under United States v. Mead Corporation, 121 S. Ct. 2164 (2001), temporary regulations are not entitled to the same weight as final regulations.

1. Temp. Reg. [section] 1.927(a)-1T(f)(3) was issued under the Treasury Department's general grant of authority set forth in section 7805(a) of the Code to issue "all needful rules and regulations for the enforcement of this title." This Court has previously found such interpretative rules to require a "relatively less deferential standard of review" than regulations issued under a specific legislative mandate. Such interpretative regulations will be sustained if they represent a reasonable statutory interpretation. L&F International Sales Corp. v. United States, 912 F. 2d 377, 380 n.2 (9th Cir. 1990) (citations omitted). Although this Court has also extended substantial deference to temporary regulations, Redlark v. Commissioner, 141 F.3d 936, 939 (9th Cir. 1998), it has expressed reservations about the standard when the "temporary" rule is longstanding. See Tedori v. United States, 211 F. 3d 488, 491 n.9 (9th Cir. 2000). The Mead case suggests that the temporary nature of a regulation should affect the amount of deference it receives from this Court.

In Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), the Supreme Court set forth a two-part test in determining the deference to be accorded agency rules by the courts. First, the court must review the intent of Congress. If it is clear, "that is the end of the matter." If it is not, the question becomes whether the agency's answer is based on a permissible construction of the statute. Id. at 842-43.

In Mead, the Supreme Court confirmed that not all agency interpretations are entitled to Chevron deference. It held that administrative implementation of a particular statutory provision qualified for Chevron deference only when it appears that --

* Congress delegated authority to the agency to make rules carrying the force of law, and

* The agency interpretation was promulgated in the exercise of that authority.

The delegation "may be shown in a variety of ways, as by an agency's power to engage in adjudication or notice-and-comment rulemaking, or by some other indication of a comparable congressional intent." Mead Corporation, 121 S. Ct. at 2171. The Court concluded that certain agency rulings are entitled to deference only to the extent they have the power to persuade. 121 S. Ct. at 2171, 2177.

Thus, Mead sharply limits the class of interpretative rulings entitled to Chevron deference, generally reserving that high degree of deference to regulations promulgated through notice-and-comment rulemaking or a formal adjudication. Interpretations not meeting these requirements may qualify only in rare circumstances where it can be shown there was congressional intent to speak with the "force of law."

This Court has also underscored the importance of notice-and-comment procedures. In Fior d'Italia, Inc. v. United States, 242 F. 3d 844 (9th Cir. 2001) [cert. granted, No. 01-463(1/11/02)], the Court found that the requirements of notice-and-comment rulemaking are not "idle steps." "[B]efore the Secretary can give a regulation legal force, he must endure the scrutiny of interested groups, legislative critics and the public at large." Id. at 852. The regulation at issue in this case suffers the lack of notice and comment. Although issued in 1987, it remains "temporary" 14 years later and has not been subject to the rigors of the notice-and-comment process. Although comments were solicited on contemporaneously issued proposed regulations, the IRS and Treasury have made no amendments to reflect the comments or given any indication why they were rejected. Thus, the temporary regulation has not endured "the scrutiny of interested groups." Fior d'Italia, 242 F.3d at 852. Such a lack of administrative process deprives a temporary regulation of any basis for Chevron deference.

Moreover, Congress has shown its impatience with the issuance of "temporary" regulations that never become final. Section 7805(e) of the Code subjects temporary tax regulations issued after November 20, 1988, to automatic withdrawal unless the regulation is promulgated in final form within three years of the date of issuance. Although the FSC temporary regulation was issued before section 7805(e)'s effective date, the statute evinces congressional suspicion of the Treasury's practice of bypassing the APA notice-and-comment procedure and leaving temporary rules on the books for long periods of time.

Thus, amicus TEI submits that the Tax Court erred in presuming that the temporary regulation at issue here should be afforded substantial deference.

2. Mead recognizes that there is a great variety of ways in which laws invest government administrators with discretion. To resolve the issue in Mead, the Supreme Court turned to Skidmore v. Swift & Co., 323 U.S. 134, a 1944 decision holding that agency rulings, interpretations, and opinions are not controlling as law, but are entitled to respect as "a body of experience and informed judgment to which courts and litigants may properly resort for guidance." Factors to be considered include the thoroughness of the agency's consideration, the validity of its reasoning, its consistency with earlier and later pronouncements, and "all those factors which give it power to persuade, if lacking power to control." Id. at 140. Accord Mead, 121 S. Ct. at 2172.

Amicus TEI submits that the temporary regulation at issue in this case should be afforded only deference under Skidmore. The Treasury Department and IRS operate under a statute similar to the Customs statute reviewed in Mead. The similarity of the statutory authority implies that interpretative rules issued under section 7805(a) of the Code also do not necessarily warrant Chevron deference.

Applying Skidmore to temporary regulations such as the one involved here would place the burden on the agency to persuade the Court of the meaning of the relevant statute, encourage agencies to follow through on the notice-and-comment procedures, and discourage agencies from circumventing the intent of Congress by creating rules without public scrutiny or promulgating "temporary" regulations that never become final.

The temporary FSC regulation at issue in this case is entitled only to Skidmore deference: It constitutes a body of experience and informed judgment to which courts and litigants may properly resort for guidance but to which they should not feel irretrievably bound. Like the ruling at issue in Mead, the temporary regulation may be entitled to respect, but only to the extent it has the "power to persuade." In the absence of a meaningful use of notice and comment, a temporary regulation lacks the power to control.

For the foregoing reasons, amicus TEI respectfully urges the Court to reverse the decision of the U.S. Tax Court and limit the deference afforded the temporary regulation at issue here to the standard enunciated by the Supreme Court in Skidmore.

Argument

I. The Tax Court erred in giving substantial deference to the Treasury Department's temporary regulation.

The substantive tax issue in this case is the definition of the term "export property" for purposes of the Internal Revenue Code's foreign sales corporation (FSC) provisions. (1) Specifically, the Tax Court considered whether under pre-1997 law Microsoft Corporation's computer software "masters" -- copyrighted articles licensed to foreign subsidiaries and unrelated foreign equipment manufacturers with a right of reproduction abroad -- constitute "export property" within the meaning of section 927(a) of the Code (26 U.S.C.) (2) and Temp. Reg. [section] 1.927(a)-1T(f)(3) (26 C.F.R.). If the masters fall within that definition, tax is not imposed on a substantial portion of Microsoft's profits from exporting the products.

Issued in 1987, Temp. Reg. [section] 1.927(a)-1T(f)(3) provides:

Intangible property. Export property does not include any patent, invention, model, design, formula, or process, whether or not patented, or any copyright (other than films, tapes, records, or similar reproductions, for commercial or home use), goodwill, trademark, tradebrand, franchise, or other like property. Although a copyright such as a copyright on a book or computer software does not constitute export property, a copyrighted article (such as a book or standardized, mass marketed computer software) if not accompanied by a right to reproduce for external use is export property if the requirements of this section are otherwise satisfied. Computer software referred to in the preceding sentence may be on any medium, including, but not limited to, magnetic tape, punched cards, disks, semi-conductor chips and circuit boards. A license of a master recording tape for reproduction outside the United States is not disqualified under this paragraph from being export property. (3)

In deciding that computer masters are not "export property" under the FSC provisions, the U.S. Tax Court looked to the temporary regulation, which it explained was promulgated under the general grant of authority given to the Treasury Department under section 7805(a) of the Internal Revenue Code and not under a specific grant of legislative authority. Slip Op. at 35. Without discussion, the court concluded that "[g]enerally, temporary regulations have binding effect and are entitled to the same weight as final regulations." Id. at 32 (citations omitted). Under the standard enunciated in National Muffler Dealers Ass'n v. United States, 440 U.S. 472, 488-89 (1979), the court noted that it would defer to a regulation if it was a reasonable and permissible interpretation of the statute. Slip. Op. at 35-37. The court then upheld the regulation, interpreting it as excluding computer masters from the definition of export property. Id. at 37.

Since the court below issued its decision, the Supreme Court of the United States addressed the deference issue in United States v. Mead Corporation, 121 S. Ct. 2164 (2001). Amicus TEI submits that under the Mead case temporary regulations are not entitled to the same weight as final regulations.

A. The Ninth Circuit's Standard of Review

Temp. Reg. [section] 1.927(a)-1T(f)(3) was issued under the Treasury Department's general grant of authority under section 7805(a) of the Code to issue "all needful rules and regulations for the enforcement of this title." This Court has previously found such interpretative rules to require a "relatively less deferential standard of review" than regulations issued under a specific legislative mandate. L&F International Sales Corp. v. United States, 912 F. 2d 377, 380 n.2 (9th Cir. 1990). Interpretative regulations issued under section 7805(a) will be sustained if they represent a reasonable statutory interpretation. Id. (citing United States v. Vogel Fertilizer Co., 455 U.S. 16, 26 (1982)). (4) See also Walthall v. United States, 131 F. 3d 1289, 1297 (9th Cir. 1997) (substantial deference due reasonable Treasury regulations); Durando v. United States, 70 F. 3d 548, 550 (9th Cir. 1995) ("Courts give deference to IRS rulings and interpretations of the Code").

Although this Court has extended substantial deference to temporary regulations, Redlark v. Commissioner, 141 F. 3d 936, 939 (9th Cir. 1998), it has expressed reservations about the standard when the "temporary" rule is longstanding. In Tedori v. United States, 211 F. 3d 488,491 n.9 (9th Cir. 2000), the Court noted:

   No explanation has been forthcoming from the government as to why such a
   "temporary regulation," issued in 1987 shortly after the enactment of the
   Tax Reform Act of 1986, should remain "temporary" well over a decade later.
   (Citation omitted.)

The Court determined that it need not address any doubts it had, however, because it rejected the government's position on the merits. Id? The Mead case suggests that the temporary nature of a regulation should affect the amount of deference it receives from this Court.

B. The Mead Case

Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), is the seminal decision on determining the deference to be accorded agency rules by the courts. In Chevron, the Supreme Court set forth a two-part test:

* First, the court must review the intent of Congress. If it is clear, "that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress." Id. at 842-43.

* If Congress has not directly addressed the matter, the question becomes whether the agency's answer is based on a permissible construction of the statute. Id. If the regulatory scheme is a "reasonable accommodation of manifestly competing interests," the agency's interpretation is entitled to deference. Id. at 865.

In United States v. Mead Corp., 121 S. Ct. 2164 (2001), the Supreme Court determined that not all agency interpretations are entitled to Chevron deference. Rather, certain agency rulings are entitled to deference only to the extent they have the power to persuade. Id. at 2171-72.

The issue addressed in Mead was, in reviewing interpretative rulings, to what extent should courts defer to the agency's interpretation of the law? (6) The case involved certain tariff rulings issued by the U.S. Customs Service. These rulings are issued by port-of-entry offices to provide guidance on the application of the Customs laws to specific transactions. They are not subject to notice and comment and, although they may be published, they are required only to be made available for public inspection. The U.S. Court of Appeals for the Federal Circuit held that the rulings were not entitled to Chevron deference because the rulings do not have the force of law and are not issued with procedural safeguards such as public notice and comment. In its decision, the Supreme Court agreed that Chevron deference was not, appropriate in respect of Customs classification rulings, but its reasoning differed from that of the Federal Circuit. Id. at 2175.

In Mead, the Supreme Court held that administrative implementation of a particular statutory provision qualified for Chevron deference only when it appears that (i) Congress delegated authority to the agency to make rules carrying the force of law, and (ii) the agency interpretation was promulgated in the exercise of that authority. The delegation "may be shown in a variety of ways, as by an agency's power to engage in adjudication or notice-and-comment rulemaking, or by some other indication of a comparable congressional intent." Id. at 2171. The Court held that it is fair to assume that Congress contemplates administrative action with the effect of law when it provides for a relatively formal administrative procedure. Id. at 2172. After reviewing the statutory scheme, the Court held that Customs classification rulings were not entitled to Chevron deference. Id. at 2175.

Thus, Mead sharply limits the class of interpretative rulings entitled to Chevron deference. It generally reserves that high degree of deference to regulations promulgated through notice-and-comment rulemaking or a formal adjudication. Interpretations not meeting these requirements qualify only in rare circumstances where it can be shown there was congressional intent to speak with the "force of law."

Earlier this year, this Court also underscored the importance of notice-and-comment procedures. In Fior d'Italia, Inc. v. United States, 242 F.3d 844 (9th Cir. 2001) [cert. granted, No. 01-463(1/11/ 02)], this Court considered an appeal by a taxpayer that had been assessed Social Security taxes on its employees' tip income on the basis of an IRS estimate constructed from the taxpayer's gross revenues and a notional "tip rate." In finding for the taxpayer, this Court noted that the applicable statutes gave the IRS and Treasury Department authority to make assessments based on aggregate estimates by promulgating a regulation to that effect. The government, however, had failed to take that approach. "[B]efore imposing such rough justice," the Court cautioned, "the Secretary must follow the procedural requirements of notice-and-comment rulemaking," adding:

   These are not idle steps. The rulemaking process, by its very design,
   encourages public scrutiny of an agency's proposed course of action. By
   giving notice of a proposed rule, the agency provides interested parties
   with the opportunity to express their views and bring their political
   influence to bear on the process.

Id. at 851-52 (citations omitted). The Court noted that this process plays a particularly significant role in the tax policy arena. Referring to Treasury's broad regulatory powers, the Court added that "before the Secretary can give a regulation legal force, he must endure the scrutiny of interested groups, legislative critics and the public at large." Id. at 852.

The regulation at issue in this case likewise suffers the lack of notice and comment the Court found critical in Fior d'Italia. Although issued in 1987, it remains "temporary" 14 years later. It has not been issued in final form after notice and comment, as required by the Administrative Procedure Act (APA), 5 U.S.C. [section] 553. Although comments were solicited on contemporaneously issued proposed regulations, that proved a hollow experience, for the IRS and Treasury have made no amendments to reflect the comments. Thus, the temporary regulation has not endured "the scrutiny of interested groups." Fior d'Italia, 242 F. 3d at 852. Such a lack of administrative process deprives the a temporary regulation of any basis for Chevron deference. See Ohio Department of Human Services v. U.S. Department of Health and Human Services, 862 F. 2d 1228, 1236 (6th Cir. 1988) ("Permitting the submission of views after the effective date is no substitute for the right of interested persons to make their views known to the agency in time to influence the rulemaking process in a meaningful way" (citations omitted)). (7)

Congressional intent concerning the force and effect of temporary tax regulations may also be discerned by reviewing section 7805(e) of the Code. That section, enacted in 1988, subjects temporary tax regulations issued after November 20, 1988, to automatic withdrawal unless the regulation is promulgated in final form within three years of the date of issuance. Although the FSC temporary regulation was issued before section 7805(e)'s effective date, (8) the statute evinces congressional suspicion of the Treasury's practice of bypassing the APA notice-and-comment procedure and leaving temporary rules on the books for long periods of time. S. Rep. No. 100-309, 100th Cong., 2d Sess. 7 (1988). Thus, section 7805(e) demonstrates an intent that longstanding temporary regulations such as the one at issue here should not automatically have the force of law.

Thus, amicus TEI submits that the Tax Court erred in presuming that the temporary regulation at issue here should be afforded substantial deference.

II. The temporary regulation should be accorded only Skidmore deference.

Mead recognizes that there is a great variety of ways in which laws invest government administrators with discretion. (9) To resolve the issue in Mead, the Supreme Court turned to Skidmore v. Swift & Co., 323 U.S. 134, a 1944 decision holding that agency rulings, interpretations, and opinions are not controlling as law, but are entitled to respect as a body of experience and informed judgment:

   We consider that the rulings, interpretations and opinions of the
   Administrator under the [Fair Labor Standards] Act, while not controlling
   upon the courts by reason of their authority, do constitute a body of
   experience and informed judgment to which courts and litigants may properly
   resort for guidance.

323 U.S. at 140 (emphasis added). Factors to be considered include the thoroughness of the agency's consideration and the validity of its reasoning, the rule's consistency with earlier and later pronouncements, and "all those factors which give it power to persuade, if lacking power to control." Id. Accord Mead, 121 S. Ct. at 2171-72. (10)

Amicus TEI submits that the temporary regulation at issue in this case should be afforded only deference under Skidmore. The Treasury Department and IRS operate under a statute similar to the Customs statute reviewed in Mead. Section 7805(a) of the Code authorizes the Treasury Secretary to issue "all needful rules and regulations." The Customs statute at issue in Mead authorizes the Treasury Secretary to adopt "rules and regulations" providing for the issuance of "binding rulings prior to the entry of merchandise...." The similarity of the statutory authority implies that interpretative rules issued under section 7805(a) of the Code do not necessarily warrant Chevron deference.

This case provides an opportunity for the Court to apply the standard established by the Supreme Court in Mead. Applying Skidmore to temporary regulations such as the one involved here would place the burden on the agency to persuade the Court of the meaning of the relevant statute. It would also encourage agencies to follow through on the APA procedures and issue final regulations. Finally, it would discourage agencies from circumventing the intent of Congress because it is more expedient to create rules without public scrutiny or to issue "temporary" regulations that never become final. See Thomas Jefferson University v. Shalala, 512 U.S. 504, 525 (1994) (Thomas, J., dissenting) (issuing vague regulations "maximizes agency power and allows the agency greater latitude to make law through adjudication, rather than through the more cumbersome rulemaking process.").

The temporary FSC regulation at issue in this case is entitled only to Skidmore deference: It constitutes a body of experience and informed judgment to which courts and litigants may properly resort for guidance. Like the Customs classification ruling in Mead, the temporary regulation may be entitled to respect, but only to the extent it has the "power to persuade." Christensen, 529 U.S. at 587 (citation omitted). In the absence of a meaningful use of notice and comment, a temporary regulation lacks the power to control. See American Express Co. v. United States, 262 F. 3d 1376, 1382-83 (Fed. Cir. 2001) (stating that IRS decisions not adopted in regulations after notice and comment are probably not entitled to Chevron deference); Matz v. Household International Tax Reduction Investment Plan, 265 F. 3d 572 (7th Cir. 2001) (reviewing a position espoused by the IRS in an amicus brief under the Skidmore standard); U.S. Freightways, 270 F. 3d at 1142 (Skidmore deference appropriate for IRS's interpretation of its own regulations).

Conclusion

For the foregoing reasons, amicus Tax Executives Institute respectfully urges the Court to reverse the decision of the United States Tax Court and limit the deference afforded the temporary regulation at issue here to the standard enunciated by the Supreme Court of the United States in Skidmore v. Swift & Co., 323 U.S. 134 (1944).

(1) See I.R.C. [subsection] 921-927 (26 U.S.C.).

(2) For the years at issue in the case, the FSC provision defined "export property" as property "manufactured, produced, grown, or extracted in the United States." Excluded from this definition were "patents, inventions, models, designs, formulas, or processes, whether or not patented, copyrights (other than films, tapes, records, or similar reproductions, for commercial or home use), good will, trademarks, trade brands, franchises, or other like property." I.R.C. [subsection] 927 (a)(1)(A) & (a)(2)(A) (emphasis added). In 1997, the words "and other than computer software (whether or not patented)" were added to the italicized parenthetical.

(3) The italicized portions of the temporary regulation were added when the regulation was issued in temporary and proposed form in 1987. The remainder of the temporary regulation is based on Treas. Reg. [section] 1.993-3(f)(3), which was promulgated in 1977 under the domestic international sales corporation (DISC) regime. The DISC regime was replaced in 1.984 by the FSC provisions.

(4) In contrast, legislative regulations are given "controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute." Redlark v. Commissioner, 141 F.3d 936, 940 (9th Cir. 1998) (citing Chevron U.S.A. v. Natural Resources Defense Council, 467 U.S. 837,844 (1984)).

(5) See also Kikalos v. Commissioner, 190 F.3d 791, 795-796 (7th Cir. 1999) (suggesting that a temporary regulation may be entitled to no more deference than a proposed one, but declining to address the issue because the parties had not raised it).

(6) The technical issue in the case was whether Mead Corporation's "day planners" were subject to duty as "bound diaries" under the Harmonized Tariff Schedule of the United States. 121 S. Ct. at 2169-70.

(7) See also South Central United Food & Commercial Workers Unions & Employers Health & Welfare Trust v. Appletree Markets, Inc., 19 F.3d 969, 973 (5th Cir. 1994) ("Once it is recognized that Executive rulemaking is actually interstitial legislation, it becomes inappropriate to defer to proposed regulations, as that would upset the constitutional balance of power among the branches in the same manner as would deference to laws considered but not enacted by Congress.").

(8) The temporary regulation was issued on March 2, 1987.

(9) Mead confirms that there is a range of deference standards to be used in assessing agency interpretations. 121 S. Ct. at 2176 n.18; see U.S. Freightways Corp. v. Commissioner, 270 F.3d 1137, 1141 (7th Cir. 2001) (noting that Mead demonstrates that deference is "not an all-or-nothing proposition"). At one end of the spectrum is the Chevron case, at the other Skidmore. Mead, 121 S. Ct. at 2176 n.18. There have been discussions whether the Chevron and National Muffler Dealers standards materially differ. See, e.g., General Electric Co. v. Commissioner, 245 F.3d 149, 154 n.8 (2d Cir. 2001). Amicus TEI submits that cases such as National Muffler Dealers--which was relied upon by the court below and discusses the standard of deference for interpretative tax regulations--remain part of the continuum of deference standards. See United States v. Cleveland Indians Baseball Co., 532 U.S. 200, --, 121 S. Ct. 1433, 1444 (2001) (citing National Muffler Dealers, the Court noted it would defer to the Treasury's regulations as long as they "implement the congressional mandate in some reasonable manner"). Under Mead, however, a temporary regulation is not entitled to deference under either Chevron or National Muffler Dealers. Cf. U.S. Freightways, 270 F.3d at 1142 (more informal agency statements and positions deserve "a more flexible respect" than Chevron).

(10) See also Christensen v. Harris County, 529 U.S. 576, 587 (2000) ("[i]nterpretations such as those in [Department of Labor] opinion letters -- like interpretations contained in policy statements, agency manuals, and enforcement guidelines, all of which lack the force of law -- do not warrant Chevron-style deference"; rather, they are entitled to deference under Skidmore).