Briefing Complete in Wayfair

Post by
April 13, 2018

The parties have now completed the briefing in the Wayfair case involving sales tax collection by out-of-state sellers, which was discussed in previous posts here and here.  Oral argument is scheduled for April 17, and the Court is expected to issue its decision by the end of June.

The retailers’ response brief argues that the reliance interests and concerns about undue burdens on interstate commerce that motivated the Court’s decision to apply stare decisis principles and adhere to settled law in Quill remain in force today.  The brief focuses heavily on trying to rebut South Dakota’s contention that modern software has largely eliminated the burden for out-of-state sellers to collect taxes on behalf of many jurisdictions.  The brief also argues that the increase in online commerce does not provide a basis for departing from Quill, asserting that the amount of uncollected sales tax is actually diminishing and that there is no workable rule that has been proposed that could substitute for  the physical-presence rule.  Finally, the brief argues that overruling Quill could unfairly expose retailers to retroactive tax liability and urges the Court to leave it to Congress to determine how best to balance the competing considerations surrounding sales tax collection by out-of-state sellers.

The United States has filed an amicus brief supporting South Dakota.  It argues that Quill should be overruled if necessary, but also argues that “Quill‘s precedential effect is less sweeping than the courts below and the parties in this case have supposed” and invites the Court to uphold the South Dakota statute by limiting the reach of Quill to mail-order sales and holding that it does not impose a physical-presence rule for online retailers. Twelve other amicus briefs were filed in support of South Dakota, and 23 amicus briefs were filed in support of the retailers.  In addition, five amicus briefs were filed that were captioned as in support of neither party.

The parties’ briefs and the amicus brief of the United States are linked below.

Wayfair – Brief for Respondents Wayfair, Overstock, and Newegg

Wayfair – Brief for the United States

Wayfair – Reply Brief for South Dakota