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Multistate Tax Alert: 10th Circuit Court of Appeals Orders Dismissal of Injunction

Precluding Colorado from enforcing its remote seller sales and use tax notice and reporting requirements


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Overview

On August 20, 2013, the United States Court of Appeals for the Tenth Circuit remanded Direct Marketing Association v. Barbara Brohl1 to the District Court of Colorado and instructed the lower court to dismiss the Commerce Clause claims of the Direct Marketing Association (“DMA”) for lack of jurisdiction, dissolve the permanent injunction entered against the Colorado Department of Revenue (the “Department”) from enforcing its remote seller sales and use tax notice and reporting requirements, and take further appropriate action consistent with the Tenth Circuit Court’s opinion.2

The Tenth Circuit Court’s ruling reverses the District Court’s March 30, 2012, ruling in Direct Marketing Association v. Roxy Huber which granted DMA’s motion for summary judgment and permanently enjoined the Department from enforcing the provisions of the state’s sales and use tax notice and reporting requirements contained in Colo. Rev. Stat. § 39-21-112(3.5) and its accompanying regulations.3 This Tax Alert summarizes the Tenth Circuit Court of Appeal’s order.

To read the background and summary of the court of appeal’s ruling, please download our alert. 

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1 Direct Marketing Association v. Barbara Brohl, 10th Cir., No. 12-01175, 8/20/13, D.C. No. 1:10-CV-01546-REB-CBS.
2 Direct Marketing Association, slip. op. at 32.
3 See our prior Alert at: Deloitte Tax LLP | Multistate Tax Alert: Permanent Injunction Issued Precluding Colorado from Enforcing its Remote Seller Sales Tax Notice and Reporting Requirements.

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