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UPMC asks judge to dismiss city's lawsuit challenging its tax-exempt status

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Friday, April 26, 2013, 3:27 p.m.

UPMC on Friday asked a federal judge to dismiss the city's lawsuit challenging its tax-exempt status for the same reasons the medical system originally moved the lawsuit from Allegheny County Common Pleas.

The city claims in the lawsuit filed last month that UPMC doesn't qualify under state law as a “purely public charity” exempt from the city's payroll tax.

UPMC had the case removed to federal court last week on the grounds that it involves questions on the medical system's tax-exempt status under the Internal Revenue Code and the state criteria violated the Constitution's commerce clause.

While UPMC's motion to remove the case to federal court was automatically granted, the city can challenge the motion and seek to have it remanded to state court.

E.J. Strassburger, one of the lawyers representing the city, said the city plans to do that soon because the lawsuit is only making claims under state law.

“We are going to move to send the case back to common pleas, where it belongs,” he said.

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