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A team of Best Best & Krieger LLP attorneys defeated a property tax refund action that Kohl’s Department Stores, Inc. brought against the County of Riverside, the Riverside County Assessment Appeals Board No. 5 and Assessor-County Clerk-Recorder Peter Aldana. Kohl’s disputed the adjusted and annual assessments for its business personal property and fixtures at 12 of its Riverside County department stores.
Last month, Riverside County Superior Court Judge Randall S. Stamen ruled in the defendants’ favor, finding that substantial evidence supported the Board’s decision to uphold the assessed value of the assets, which included machinery and equipment, office furniture and equipment, point-of-sale equipment, telephone and security equipment, and computer and radio frequency equipment.
Most notably, Kohl’s claimed that the Board committed reversible error in not accounting for, among other things, external obsolescence in its underlying administrative findings. Kohl’s argued that growing e-commerce trends in the retail sector rendered the assets within its brick-and-mortar stores externally obsolete and, therefore, less valuable.
Partner Mark A. Easter and associates Andrew G. Saghian and Daniella V. Hernandez successfully argued that substantial evidence supported the Board’s decision to consider, but ultimately reject, Kohl’s proffered external obsolescence evidence. In ruling in the defendants’ favor, the court found that the assets were not inherently less valuable simply because sales were declining at Kohl’s brick-and-mortar stores. The court also agreed with BB&K’s position that Kohl’s failed to present evidence demonstrating that the assets could not have been utilized in its growing e-commerce division.
In the end, the court found that substantial evidence supported the Board’s determination that Kohl’s failed to carry its burden of proof on the ultimate question of whether the Assessor’s valuation was valid.
The case is Kohl’s Department Stores, Inc. v. County of Riverside, et al. (Riverside County Superior Court, Case No. RIC1801102).

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