Supreme Court Decision Alert - June 1, 2010

Originally published June 1, 2010

Keywords: Tax Injunction Act, collection of tax, State law, Levin, tax exemption

Today the Supreme Court issued one decision, described below, of interest to the business community.

Tax Injunction Act—Federal Jurisdiction

Levin v. Commerce Energy, Inc., No. 09-223 (previously discussed in the November 2, 2009 Docket Report).

The Tax Injunction Act ("TIA"), 28 U.S.C. § 1341, prohibits federal district courts from restraining "the assessment, levy or collection of any tax under State law where a plain, speedy and efficient remedy may be had" in state courts. Today, in Levin v. Commerce Energy, Inc., No. 09-233, the Supreme Court held that, even when the TIA does not by its terms apply, broader principles of comity may prevent federal district courts from entertaining claims that pose the risk of disrupting a state's taxation scheme. The practical impact of the Court's decision is likely to be significant. By clarifying the