In any event, the success of investors in avoiding tax was short lived. The following year, the Court ruled that capital gains were income and that they should be recognized as income when the stock was sold. In addition, the exception for stock dividends was narrowed by the Court in such cases as "United States v. Phellis", (shares in a subsidiary corporation that were issued to stockholders in the parent corporation were taxable as income); "Rockefeller v. United States" and "Cullinan v. Walker" (increases in capital accumulated by corporations over time were taxable when shares were distributed to stockholders in a successor corporation).