Update: Movement in U.S. Supreme Court Cases Significant for Small Businesses

May 2, 2023

U.S. Supreme Court decides in favor of small business in major case

Update: Movement in U.S. Supreme Court Cases Significant for Small Businesses

Across the nation, the NFIB Small Business Legal Center advocates for the rights of small businesses in dozens of court cases. In March and April, significant movement took place in three of these cases at the U.S. Supreme Court: one was decided in favor of small business, oral arguments took place in another, and in a third case, NFIB filed an amicus brief urging the nation’s highest court to grant review. Quad Graphics, Inc. v. North Carolina Department of Revenue. On April 17, the Small Business Legal Center filed an amicus brief at the U.S. Supreme Court. The case concerns whether the North Carolina Supreme Court wrongfully held that taxing authorities don’t have to follow the United States Supreme Court’s decision in a previous case which said that a state cannot tax sales that occur outside its borders. “Small businesses pay for the administrative costs of computing, collecting, and remitting sales taxes,” said Beth Milito, Executive Director of the NFIB Small Business Legal Center. “If the North Carolina Supreme Court’s decision is upheld, it will allow more states to impose the significant financial and administrative burdens of sales tax collection on out-of-state manufacturers and small businesses. We urge the Supreme Court to grant the petition for review.” NFIB’s brief argues that the previous Supreme Court decision should still be upheld, and that allowing the North Carolina Supreme Court’s decision to go unreviewed would hurt both manufacturers and small businesses. Wilkins v. United States. On March 28, the U.S. Supreme Court ruled that the Quiet Title Act’s (QTA) statute of limitations did not meet the standard to be jurisdictional and reversed the lower court’s decision. “Small business property owners will greatly benefit from today’s Supreme Court decision,” said Milito. “The Court reinforced the importance of property rights and the balance between the government and property owners. We are encouraged by today’s decision.” The case asked whether the statute of limitations in the QTA is a jurisdictional requirement, or a claim-processing rule. The Supreme Court ruled that the QTA is a claim-processing rule that gives parties, including small businesses, more leeway and leniency in the litigation process. NFIB previously filed an amicus brief in the case arguing that the QTA’s statute of limitations did not meet the high bar to be jurisdictional, and was instead, a claim-processing rule. Because the Supreme Court agreed, small business property owners can still have their day in court, even if they file after the 12-year statute of limitations. Geraldine Tyler v. Hennepin County. On April 26, the U.S. Supreme Court heard oral arguments in a case concerning whether the government, after seizing and selling a person’s home to collect back taxes, can keep the surplus amount collected from the sale. This government practice is commonly referred to as “home-equity theft.” NFIB previously filed an amicus brief in the case. “This case highlights a fundamental amendment of our country’s Constitution,” said Milito. “Small business property owners work hard to comply with various regulations and pay numerous taxes at every level of government. Due to the Fifth Amendment, the government has no authority to keep a surplus of money accumulated and harm property owners. NFIB urges the Supreme Court to reverse the Eighth Circuit’s decision.” The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.

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Taxes

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