California billionaires are gearing up for a legal attack on the first-in-the-nation wealth tax if voters approve it in November.

The California Business Roundtable, a lobbying group representing some of the state’s most powerful companies, would take point on the legal challenges, according to Chief Executive Officer Rob Lapsley. The group has retained Elizabeth Prelogar, the Biden Administration’s top lawyer at the US Supreme Court, to help lead the efforts, Lapsley said.

The group is working closely with the billionaires affected by the tax to formulate a legal strategy, according to people familiar with the matter who asked not to be identified because they haven’t been authorized to speak publicly.

The California Business Roundtable, which represents technology, energy and other corporate interests in the state, has raised at least $700,000 to oppose Proposition 40 through its political arm, according to campaign filings. The ballot measure would allow a one-time 5% tax on the net worth of California billionaires and has drawn fierce opposition from some of the state’s wealthiest residents, who have doled out close to $300 million to defeat it. Polls show voters divided.

“Our approach to defeat Proposition 40 is based on a comprehensive strategy that includes both the ballot box and the courts,” Lapsley said in a statement to Bloomberg News. “We will be fully prepared to file a legal challenge immediately after the election should we need to defeat this measure in the courts.”Prelogar, now a partner at law firm Cooley, is no stranger to the constitutional fight over taxing wealth. As President Joe Biden’s solicitor general, she defended the federal government’s authority to tax certain foreign corporate earnings that hadn’t been distributed to American shareholders.

Opponents of wealth taxes had hoped the Supreme Court would use the case, , to establish constitutional limits on the taxation of unrealized gains. The court ultimately upheld the tax while avoiding a sweeping ruling that could have broader implications for wealth taxes.

The proposed California levy would go considerably further than taxing income. Instead, it targets an individual’s entire net worth and applies to billionaires who have resided in the state at any point since Jan. 1, 2026.

Tom Hiltachk, an election lawyer who previously advised opponents of the measure, expects it to trigger legal disputes over residency and how particular assets should be valued and taxed. He also anticipates broader constitutional challenges, including arguments that the tax is retroactive and that taxing assets outside California would violate legal protections for interstate commerce rules.

Supporters of Proposition 40 are also anticipating a legal fight, and have retained Supreme Court lawyer Deepak Gupta, said Dave Regan, the president of the healthcare-workers union backing the tax.

A legal memo written by law firm Gupta Wessler argued the retroactivity of the wealth tax is only for the purposes of determining residency — and is ultimately unrelated to what people may owe, the firm said in a document reviewed by Bloomberg News. The firm also argued that any constitutional challenge is unlikely to be persuasive. Gupta Wessler didn’t respond to a message seeking comment.

“There is nothing legally innovative about Proposition 40, it is based on a century of settled law,” Regan said. “The only thing unique about it is that it taxes billionaires.”