Saying they were overcharged stemming from a transaction in 2004, Google and AOL are suing the Internal Revenue Service for $88 million.
Google, based in Mountain View, California, issued the warrant for its “series D preferred stock” in June 2002 in recognition of AOL efforts to promote Google’s search engine among its users, according to the complaint.
The IRS erred in disallowing a $238.6 million deduction claimed for the difference between the price AOL paid to exercise a warrant for Google stock and the value of the shares, according to the complaint in U.S. Tax Court.
AOL’s suit is separate from Google’s action. Google is asking for over $83 million and AOL is asking for over $4 million.