Colorado Not Allowed To Demand All Purchase Info From Companies
from the consumer-privacy dept
Remember how North Carolina was demanding that Amazon hand over pretty much all purchase info on every citizen who had ordered anything from the site? Thankfully, Amazon won that lawsuit, and was allowed to protect purchaser privacy. However, other states apparently didn't get the message. Michael Scott points us to the news that the state of Colorado, which had put in place a similar law, just got a preliminary injunction barring it from enforcing the law. While it's not a final ruling, it does mean that the companies protesting this law have established a "substantial likelihood" of prevailing. The ruling focuses on how the law violates the Commerce Clause in regulating interstate commerce (which state governments are not allowed to do). It doesn't directly discuss the privacy issues, other than indirectly to note that weighing the balance of potential "harms" it makes sense to block this law. If the law is later found to be legal, then the state can still get that info and collect taxes, but if the law is allowed to be enforced, it could violate people's privacy and other rights.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Reader Comments
Subscribe: RSS
View by: Time | Thread
Funny
All because some farmer wanted to grow wheat to use privately, and the government wanted to stop him from doing that.
Google farmer, wheat, commerce clause.
[ link to this | view in thread ]
The states are trying to rob Peter to pay Paul
As a consumer, I don't care (in general) where the money goes, my concern is the bottom line for what I am buying. If my laptop with tax is $900 through Dell, and $850 through Amazon, I am going to save $50 and go with the latter. It is irrelevant that the Dell price was $840 plus $60 that was is paid to the state.
[ link to this | view in thread ]
Re: The states are trying to rob Peter to pay Paul
Attempting to apply various state taxes on a product is anti-competitive and against the interests of the states, as they make it more expensive for the residence of the state to buy from in state companies, and cheaper to buy from out of state.
I suspect you will end up with a system of "state tax in the state of origin (shipping) only, or federal tax for everyone else" which would likely come very close to leveling the playing field (and might even encourage some states to use a lower sales tax to be more attractive than the federal rate).
[ link to this | view in thread ]
Re: Funny
Google farmer, wheat, commerce clause.
I don't have to google it... you're talking about Wickard v. Filburn. Wickard doesn't apply here though, since that was a regular commerce clause case, and this one's a dormant commerce clause case. The feds aren't a party to this case.
[ link to this | view in thread ]
That's not exactly true--states can regulate interstate commerce, but only under certain conditions. Article I, section 8, clause 3, the Commerce Clause, grants Congress the power to regulate commerce between the states. The Constitution is silent as to what states may or may not do in the absence of congressional legislation. The doctrine that has evolved over the years is that the Commerce Clause implies a restriction that prohibits a state from passing legislation that improperly burdens or discriminates against interstate commerce. This is known as the Dormant Commerce Clause.
This judge in this case is saying that the Act is likely to be a facially discriminatory state law. The judge didn't use the word, but this is "protectionism" where a state erects a barrier to trade in order to protect in-state interests at the expense of out-of-state interests. Such laws are invalid unless the state can prove the discrimination is necessary to promote a legitimate state interest. While collection of tax is a legitimate state interest, the state failed to show that this interest could not be met by some other reasonable alternative.
The privacy issue is an interesting one, but since the judge found a likelihood of the law being impermissibly discriminatory on its face, it wasn't necessary to discuss that issue.
[ link to this | view in thread ]