SALT LAKE CITY
March 28, 2013
(NASDAQ: OSTK) is considering a U.S. Supreme Court appeal of the adverse ruling handed down today by the
Court of Appeals in its case contesting the constitutionality of
's affiliate tax laws.
"We are disappointed in today's ruling, but confident of our position that the
law is unconstitutional on its face and violates due process," stated
, Overstock.com's acting chief executive officer. "Given that courts in other states have upheld U.S. Supreme Court precedent, and struck down similar laws, the matter appears ripe for resolution by the U.S. Supreme Court."
The company noted the strong dissent filed by
, observing that
's analysis more closely tracks federal precedent as it bears on the constitutional questions the company has raised concerning
The company states that, while unfortunate, today's decision will have no impact on the company's operations. The
law passed in 2008 was aimed at conscripting out-of-state retailers to collect
and local sales taxes if the retailers used the services of
-based internet advertisers for banner and other types of internet advertising. Overstock and many retailers, rather than undergo the significant burden of tax collection without just compensation, reluctantly terminated the services of its
-based advertisers. Eight other states have passed similar laws, the chief effect of which has been to put many internet advertisers out-of-business, resulting in lost income tax revenue to those states. In Illinois, many of the top twelve internet advertisers in the state moved to other jurisdictions. Subsequently, an
state court ruled the
"We have opposed at each opportunity the patchwork quilt of state laws, but we do not oppose the right federal solution to this national question," noted Johnson, who in recent months has worked with key congressional representatives to shape the contours of a national plan to allow state to use remote retailers for tax collection so long as the states agree to necessary conditions.