A detail in Amazon.com Inc.'s recent major court win suggests that the decision’s impact won’t extend to how companies should approach cost-sharing arrangements in the future.

A panel of the U.S. Court of Appeals for the Ninth Circuit pointed to 2009 temporary regulations that expanded the definition of intangibles to include assets such as the value of employee experience or a company’s reputation. It also referenced statutory changes in the 2017 tax law to include those assets and any other item with value that doesn’t come from tangible property or a person’s services.

“If this case were governed by the 2009 regulations or by the 2017 statutory amendment, there is no doubt the Commissioner’s position would be correct,” the three-judge panel said in a footnote in Amazon.com Inc. v. Commissioner. Tax experts said that means the court’s ruling may not apply to more recent cost-sharing arrangements, so companies may face taxes on the types of assets Amazon was able to exclude.

Amazon sued after the IRS increased its tax bill for 2005 and 2006 by $234 million, disputing Amazon’s choice to exclude certain intangible assets from a cost-sharing arrangement that it created to transfer intangible property to its European subsidiaries.

“They put that footnote up front to say Treasury didn’t have the explicit authority to make the adjustment they made then, but now they do,” said Barbara Mantegani, a lawyer at Mantegani Tax, PLLC who focuses on transfer pricing.

A cost-sharing arrangement is when entities agree to share the costs of developing intangible property in exchange for sharing income generated by the property.

Because the footnote wasn’t essential to the holding of the case, it isn’t actually binding on any future decisions. But attorneys said it still signals the panel’s view.

“The court seems to be saying that such changes would have changed the outcome in Amazon,” even though it isn’t setting precedent, said John P. Warner, a shareholder at Buchanan Ingersoll & Rooney PC in Washington and a member of the Bloomberg Tax International Advisory Board.

The IRS and Amazon declined to comment. The Treasury Department didn’t return a request for comment.

Rely on the Case

Still, Reuven S. Avi-Yonah, a professor at the University of Michigan Law School, said companies may try to rely on the case to say their similar cost-sharing arrangements under the new regulations are appropriate.

“So my view is that this is yet another significant loss for the IRS and that it shows that fundamental reform is still needed,” he said. Avi-Yonah has previously described the entire cost-sharing-arrangement system as an “expensive mistake” because it hasn’t prevented multinationals from concentrating the profits from U.S.-developed intangibles in low-taxing foreign jurisdictions.

The appeals court in the Amazon case agreed with the company and the US. Tax Court that residual business assets—forms of inseparable, intangible assets such as a culture of innovation or the experience of its workforce—didn’t need to be included in the cost-sharing arrangement.

John P. Steines, a professor at the New York University Law School, agreed companies may argue the 2009 regulations go beyond what the Treasury Department was authorized to say.

But he thought a recent decision from a different panel of Ninth Circuit judges involving Intel-owned Altera Corp. could make that effort more difficult.

“Altera, because it gives credence to IRS regulation-writing latitude that many tax lawyers (myself not among them) thought was vulnerable, makes the judicial atmosphere more difficult for taxpayers,” Steines wrote in an email. Steines filed an amicus brief in Amazon’s case, supporting the company’s position.

Altera has appealed the decision in its case, asking the Ninth Circuit court to take up the case en banc.