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California’s Franchise Tax Board (FTB) says inventor Gilbert Hyatt owes $55 million in taxes. Hyatt says he’s the target of a vendetta, and as Dale Kasler shows in the Sacramento Bee, Hyatt has a strong case. In 1990 Hyatt was awarded the patent for the first single-chip microprocessor and earned $350 million in royalties. Hyatt said he moved to Nevada, which has no state income tax. The FTB claimed Hyatt lied about his residency, and owed $7.4 million, which has ballooned to $55 million over more than 20 years. Hyatt sued the FTB for harassment and violation of privacy and in 2008 a Las Vegas jury awarded him $388 million, including $250 million in punitive damages. That has since been reduced and a new trial ordered on the money Hyatt, now 76, deserves for emotional distress. Despite the reduction, that was a victory for Hyatt but California continues to pursue the case, with recent encouragement from a federal judge.
“It is an overreach,” former Board of Equalization member Bill Leonard told Newsmax. “In my experience, no other case has gone on this long.” Leonard, who also served in the state Senate and Assembly, said the FTB action “does amount to a persecution at this point.” The FTB, “just pick on anyone successful and extract their due.”
Analyst Paul Hatfield wonders if any FTB employees were ever disciplined over the case. The answer appears to be no. And despite losses, the FTB is willing to keep spending taxpayer dollars in pursuit of Hyatt, without any attempt to justify the growing expense for the public.
The case confirms that government greed is truly fathomless, and that California’s Pillage People are out of control and not accountable to the people. Nobody in Sacramento seems intent on doing anything about it.