The Weird Trademark Issue That Shows Up In The Harlan Crow / Clarence Thomas Mess
from the tax-loopholes-for-the-ultrawealthy dept
I didn’t think we had much reason to write about all of the Harlan Crow / Clarence Thomas stuff that I’m sure you’ve read elsewhere. But the latest (in a now increasingly long series) of mind-blowing revelations from ProPublica regarding the relationship between the billionaire and the Supreme Court Justice… actually has a somewhat bizarre trademark angle.
The story is about how Crow was able to cut his tax bill thanks to getting Clarence Thomas to take free rides on his superyacht. The real issue here is less about the Crow / Thomas relationship, and much more about the tax loopholes for the ultrawealthy. Specifically, the report notes that the ultrawealthy can deduct from their taxes by claiming that their yachts and private jets are actually used commercially, generally for chartering.
In order to claim these sorts of deductions, taxpayers must be engaged in a real business, one that’s actually trying to make a profit. If expenses dwarf revenues year after year, the IRS might conclude the activity is more of a hobby. That could lead to the deductions being disallowed, plus penalties. Nevertheless, the ultrawealthy often pass off their costly pastimes, like horse racing, as profit-seeking businesses. In doing so, they essentially dare the IRS to prove otherwise in an audit.
For a yacht owner to meet the legal standard of operating a for-profit business, said Michael Kosnitzky, co-chair of the private client and family office group at the law firm Pillsbury Winthrop, “You have to be regularly chartering the yacht to third parties at fair market value,” typically through an independent charter broker.
However, the ProPublica reporters interviewed “around a dozen former crew members” of Crow’s superyacht, and none of them remember the boat ever being chartered.
And here’s where the trademark issue showed up. Crow tried to trademark the name of the yacht (the Michaela Rose), but, of course, for there to be a trademark, it needs to be used in commerce. This seems like a weird game of tax loophole chicken, where in order to get the IRS to believe the boat was being chartered, he (or his tax attorneys) tried to get the boat trademarked, to claim it was used in commerce. Basically, he had to convince either the IRS or the Trademark Office to believe him so that he could then convince the other one.
So the lawyers made up a pretty simplistic brochure to pretend that the ship was available for charter and submitted it with the trademark application.
But, that brochure says absolutely nothing about actually chartering the boat. It’s more just a bragsheet for Crow’s boat, rather than anything about actually chartering it.
The USPTO noticed this and rejected the mark (twice) before finally approving it when Crow’s lawyer showed them full screen screenshots (someone teach that lawyer how to do proper screenshots) of the boat listed on two yacht websites: superyachts.com and liveyachting.com, even though having a listing on those sites does not mean the boats are available for charter.
Apparently, though, it was enough to get the trademark approved:
“Registration is refused because the specimen does not show the applied-for mark in use in commerce,” the USPTO’s attorney responded.
Crow’s attorney asked the USPTO to reconsider. The brochure was “provided by Applicant directly to its customers and potential customers,” he wrote. Wasn’t that enough?
When USPTO again refused, the attorney provided new evidence: screenshots of the websites superyachts.com and liveyachting.com. These show “links and references to yacht ‘Charter’ services offered in connection with Applicant’s MICHAELA ROSE mark,” the attorney wrote.
At this point, the USPTO agreed to approve the trademark, but the evidence was dubious. Hundreds of ships have profiles on superyachts.com whether they are available to charter or not. The LiveYachting page merely encouraged readers to contact a broker “for finding out if she could be offered for yacht charters.”
And, boom, once he has a trademark, he can claim that the USPTO believed it was used in commerce, and therefore he can try to convince the IRS it is as well, even if that doesn’t appear to actually be happening.
When questioned about this by the Senate Finance Committee (specifically, Senator Ron Wyden who chairs the committee), Crow tried to claim that whenever he took personal trips on the boat (including with Thomas) he… paid himself prevailing charter rates, and thus it’s used in commerce.
That’s a neat trick! If every time I drive my car, I transfer money from one bank account to another, can I tell the IRS that I used it for business? I’m somehow guessing I wouldn’t get away with that. But, then again, I’m no billionaire.
Anyway, again, this story is more about tax loopholes for the ultrawealthy than anything specifically about Thomas (the other stories are much more damning on that front), but I was surprised to come across that trademark tidbit in the process.
Filed Under: clarence thomas, harlan crow, superyachts, tax loopholes, trademark, yachts
Comments on “The Weird Trademark Issue That Shows Up In The Harlan Crow / Clarence Thomas Mess”
The Supreme Court is illegitimate.
This comment has been flagged by the community. Click here to show it.
Re:
Another example of the dangerous pro-communist, anti-American mentality that MM seeks to foster here btl at TD. Shameful.
Re: Re:
Please explain how pointing out failings of the SCOTUS makes one a communist.
Or possibly yoy see no problems with the court? If so, how would you respond if the tables were turned? (not expecting an honest answer here but wth)
Re: Re: Re:
When someone makes shit up, do you really believe they are honest enough to actually explain their reasoning?
This is just another example of an asshole who is butthurt because no one here believes in their delusional lies.
Re: Re: Re:
Caring for the good of all rather than a select few is by definition communist. Of course that definition is not readily recognizable in today’s “communist” countries except possibly on propaganda leaflets, and the term “socialist” has also been significantly poisoned by the USSR and other Warsaw Pact and affiliated countries.
There have been several Western Europe “communist” and “socialist” governments that reflect better on those historic terms. Admittedly, the meanings introduced in socioeconomic treatises by Marx et al are not a readily recognizable match to anything in the world, but then try drawing the line from the Gospel to current-day Christianity.
Somehow the good things have a tendency to go missing in transit.
This comment has been flagged by the community. Click here to show it.
Re: Re: Re:2
I’m not sure that’s the case, as much as it’s the perception. The USSR would have flourished if not for the west’s religious crusade against the atheists.
The only threat the USSR was to the rest of the world was the lack of religious enlightenment.
Look only at the values reported in Europe… the US and a few allies managed to depress a billion people and still can’t keep control of the masses on religion. Over 50% of the world population is pagan or agnostic. Shows something two ends of the spectrum became the majority.
Re: Re: Re:
OTOH, the GP does not point out failings of SCOTUS, it simply states without evidence or explanation that it is illegitimate.
While I’m not in favor of slamming TD or post authors, I’m also not keen on low-value posts.
Re: Re:
Another example of a fundamental misunderstanding of what communism is. Pro-tip: it’s not just a buzzy insult.
I wondered what those super boats were for.
Some people are easily bought.
This comment has been flagged by the community. Click here to show it.
What this story is really about is racism against the only male POC Supreme Court justice currently on the bench.
Shameful, MM.
Re:
Bribing a Supreme Court Justice is ok then?
Re: Re:
Being tax-deductible is not the same as being ok. It’s not the IRS’ job to see whether you used your money for good, but whether you used your money in attempted furtherance of your purported business.
Re: Re: Re:
And as shown, the IRS has challenges doing just that. Especially as Congress expressly puts blocks in the way of their investigating the ultra-rich.
Re: Re:
Rules don’t apply to them. Just ask Alito, he’ll tell you…
This comment has been flagged by the community. Click here to show it.
Re: Re:
There was nothing even vaguely LIKE a bribe.
Re: Re: Re:
…said nobody literate, ever.
Re:
Cause taking “emoluments” and refusing to recuse himself when in blatant conflict of interest, just couldn’t possibly be considered a substantive issue, amirite?
Re:
1) Horseshit.
2) Thy name is …
hypocrite
the true fuckwit
a projectionist
ascribe your beliefs
to another as a weapon
Re:
Uh, racism against the “only male person of color”? Sounds like you judge Thomas by the color of his skin rather than his pretty bleached brain writing decisions and dissents and the color of his wife and benefactors.
For him, the way to end racism is to close the eyes to its existence and stop opposing it.
The last “male person of color” on the court was Thurgood Marshall.
Like his 5 “conservative” mostly reactionary collegues, Thomas is a Federalist Society hackjob who got groomed into eagerness to overthrow precedence where this could be done to turn back the clock in jurisprudence and advance the cause of the Society’s benefactors.
This long-running effort of poisoning the judicial foundations of the republic paid off eventually.
Re:
You do realize, do you not, that POC is shorthand for “Piece Of Crap”. Just sayin’…..
Re: Re:
… except that, under that definition of ‘POC’, Thomas most definitely is not the only one on the SCOTUS bench.
Re:
Hey Jhon you finally give up on the oh so impotent legal threats bro?
Re: Re:
“Give up” assumes that he started. What John Smith had from Day 1 was nothing more than a fanciful epic meant to prop up his own misguided self-importance and never held any relevance beyond being a bombastic, boastful bluff.
Of course the yacht is used commercially.
If the yacht is an essential ressource in bribing a Supreme Court Justice over extended amounts of time in the course of the maintenance of a business empire, it is clearly being used for commercial purposes.
If Crow got hold of a fiery charot going straight to heaven, he’d probably think twice over inviting Thomas along. That would no longer be good business.
Re:
And since Crow’s 160 foot private yacht only cost him about half of what his private jet cost, that has to be accounted as a real bargain.
Doesn’t look very impressive, maybe it is a super barge.
Re:
I mean, my friend Joe’s Zodiac beats that thing!
At least in the metrics that count: weight of money you have to throw into the sea to maintain it.
Re: Re:
Well yeah, don’t you know what BOAT stands for?
Bust Out Another Thousand
Re: Re: Re:
Happiest days of a boat owners life, the day they bought their new boat and the day they sold same.
Re: Re: Re:
Definition of BOAT
A hole in the water you throw money into.
Re:
It has cabins for a dozen guests, a crew of thirteen, and a range of over a thousand miles… I wish I could afford a “barge” like that.
Clarence Thomas isn’t just an Uncle Tom, he’s an Uncle Ruckus as well.
Re:
The literary Uncle Tom was not an opportunist but a fool who did not profit from his apologism.
I should really start chartering my car travel from Tek’a Transportation Limited
Re:
No, but sites like zip and rideshare let you rent your car out for profit.
About that Commerce...
So, if the Yacht is used in commerce, I suppose he’s can show he’s reporting the income gained from it, right?
Except…
You yourself can use those tax deductions. Every time you drive to or from work. You deduct the mileage, file, and w&t on the vehicle.
Every time you fly. Or use a boat.
Big or small doesn’t matter. Those deductions are there for you too.
Re: Except except..
there are limitations on what you can claim as an employee business expense that don’t apply to the business owner. Including that the ‘drive to or from work’ is not available for travel to your regular work site – and that really screws over field workers who don’t have a regular work site in practice – all the W&T on their personal cars is just ‘daily commute’, and the travel is often on their own time as well.
Then on top of that, the expenses you can claim get a certain percentage of your gross income simply subtracted; you can start deducting them only to the extent that they exceed that number. Again, this doesn’t apply to the business owner; business owners can have the business reimburse them for expenses and write them off on the business’s return.
Plus, the little guys are so much easier to audit, and can’t afford good lawyers and accountants to push back. It’s cheaper to extract a thousand bucks from each of a hundred little guys than to get a hundred thousand from one one-percenter. And getting millions from a fat cat? Impossible, your grandchildren will still be litigating it.
So, while ‘big or small’ might not matter, ’employee or owner’ does matter, a lot.
Re: Re:
I’m not a tax attorney, so the real how’s and why’s are not my forte.
That said, contractors can definitely use mileage calculations.Among other personal expenses.
The stumbling block is if you spent more than your standard deduction.
But, it’s there.
Nobody likes the tax system. Nobody. Liberals think the taxes are too low for most, republicans want to do away with it, and libertarians support a range of views from 0% to flat tax.
I mean, the tax in this country started with and is based on, paying for war. First the war of 1812, then the Civil War.
But if you want someone to blame, blame the Lincoln Congress. Shortly after the civil war the tax system was solidified in a way to disproportionately hurt agricultural. At the time the south.
As the nation modernised and thousands of other low income jobs were added to “cotton picker” and “ranch manager” becoming burger flipper and bag stuffer…
Add to that that the amount of minimum taxable income hasn’t been raised with inflation rates, …
So yes, our tax mess is 100% the fault of republicans. Greedy vengeful northern republicans. Who watched as money came in and found new ways to grab more money. Always from someone else.
But the Democrats don’t get a pass.
Notice Dems tend to target stocks and rolling portfolios, which tend to be heals by more conservative voters.
But when was the last time a Dem looked to raid income tax on any sort of bond dividend? Or maturity increase? Or push for a raising of MTI?
Huh?
Both parties suck. Paying tax is part of life in any country that intends to maintain some level of social ability. Ur the US systems needs to be tossed out the windows and replaced.
The hard part there is getting the people who believe you should be stoped from achieving more to agree with the people who believe the more you earn the more motivation you have to keep working.
This comment has been flagged by the community. Click here to show it.
*sigh*, there's nothing "mind-bending" about it
Thomas has a rich friend, that’s literally it. No, Harlan didn’t have any business before the court. (The tenuous connection drawn is that an appeal on a distantly held stock was turned down….which Crow probably was not even aware of, and the vast majority of appeals to SCOTUS are turned down. There wasn’t even anything for Thomas to recuse himself from)
The Pro Publica articles are just a hit piece, trying to delegitimize it….cuz SCOTUS has been pointing out how a lot of what the Left wants to do is unconstitutional. And you Masnick, are a Leftist, despite your claims.
Re:
Your use of the word ‘leftist’ appears simply to be a ‘snarl word’ meaning ‘enemy’; semantic content otherwise null. (I’m pretty sure that if asked to define it, you’d simply respond with other words that to you simply mean ‘bad’ or ‘hated’.)
(FWIW, my own political leanings would be center-Right anywhere but the US, where my beliefs appear to lie far outside the current Overton window. A one-line summary might be ‘what you do on your side of the fence is your business,’ which in the US is a far-Left social position, unthinkable to both major political parties.)
Re:
…hallucinated nobody mentally competent, ever.
This comment has been flagged by the community. Click here to show it.
Re: Re:
When you say shit like this I know I have a point.
Re: Re: Re:
Does Elon Musk know you exist yet? Has he cast his peepee in your general direction for you to bow towards?
Re:
Seems any article or opinion you don’t like is either a hit piece or a lie. You really like rolling in the shit, don’t you?
This comment has been flagged by the community. Click here to show it.
Re: Re:
Only if it’s Musk’s golden goose shit, sweet cheeks.
Re: Re: Re:
Dumbasses like you are precisely why women realize that they’d rather fuck each other than you. When fucktards like you claim that decades of marriage is boring AF don’t be surprised that the lesbians are pushing their woke narrative hard. It’s not like you put up much of a fight.