Brann & Isaacson Represents Retailers in Major Supreme Court Case

On January 12, 2018, the U.S. Supreme Court agreed to hear a key dispute over the scope and limits of state taxing authority over out–of–state businesses. Respondents Wayfair Inc., Overstock.com, Inc. and Newegg Inc., among the 40 largest Internet retailers in America, are represented by Brann & Isaacson partners George Isaacson, Martin Eisenstein, and Matthew Schaefer. The firm represents over 100 online and multichannel marketing companies across the country on issues that affect the industry, including state sales and use tax. South Dakota has asked the Court to abrogate the physical presence standard of Quill Corp. v. North Dakota, which limits a state’s authority to require sales tax collection by catalog merchants, online retailers, and other remote sellers located outside the state.

“Today’s ruling is simply the beginning of the process before the Court,” said Isaacson in response to the Supreme Court decision to take up the case.  “We believe that the Court, as it undertakes careful consideration of the State’s arguments, will recognize that South Dakota’s demand that Quill be overruled is untenable and without merit.  We fully expect the Court will conclude once again, as it did in Quill, that Congress is the proper body to address the complex question of sales tax collection on Internet, catalog, and other remote sales, and defer to Congress’ exercise of its Commerce Clause powers to enact legislation that requires simplification of state taxes as a condition for any expansion of state taxing authority.”

The case is South Dakota v. Wayfair, Inc., No. 17–494.