Legal Matters: Direct Marketers Take Colorado to the Supreme Court
In the face of such a statute, it's not surprising that a non-Colorado retailer would be concerned about the neutrality and fairness of the forum in which its federal constitutional rights are to be determined. Indeed, no matter how competent and objective a state judge may be (the DMA did, in fact, obtain a preliminary injunction from a state court judge), it's a reasonable apprehension that a nonresident business will be disadvantaged and on the wrong side of some "home cooking" because of its foreign status in a state court. How those individuals and corporations whose fate and affairs will be decided in a court of law view our system of justice is critical to the integrity of America's legal system.
The DMA's position is that the TIA, which was enacted by Congress in 1937, was for the limited objective of requiring state taxpayers to follow established state procedures to protest tax assessments or file claims for refund if they claim they don't owe the taxes assessed against them. Forced recourse to state courts to assert federal constitutional objections by nontaxpayers serves no legitimate policy objective and isn't consistent with the original intent of the TIA. Indeed, such a strained interpretation of the TIA would deprive those online merchants most affected by the Colorado law access to the judicial forum in which they have the most confidence that their claims will be judged free from any bias that might result from an elected state judiciary or a predisposition towards local commercial interests.
The Supreme Court will likely issue a decision sometime in the spring of 2015. If the Supreme Court agrees with the DMA's argument and reverses the decision of the 10th Circuit Court of Appeals, then the case will be returned to the 10th Circuit for it to rule on the merits of the DMA's constitutional challenge to the Colorado notice and reporting law. If the Supreme Court affirms the 10th Circuit ruling, then the state court lawsuit will resume and that court will decide whether to issue a permanent injunction against the Colorado law.