Santa Fe Natural Tobacco Company v. Oregon Department of Revenue

By its enactment of 15 U.S.C. § 381 (“Section 381”), Congress exercised its power to regulate interstate commerce under the Commerce Clause to immunize outof-state businesses from a state’s net income tax if their only business activity in the state is soliciting orders of tangible personal property from retailers or wholesalers, provided that the orders are approved or rejected from a location outside the state and shipped from out of state. More than 30 years ago in Wis. Dep’t of Revenue v. William Wrigley, Jr., Co., 505 U.S. 214 (1992) (“Wrigley”), this Court held that Section 381 protected more in-state activities than just express solicitations of orders, with protected activities extending to both activities ancillary to solicitation and activities that are de minimis. Since this Court decided Wrigley, there has been a concerted effort by states by fiat and state judicial encroachment to further narrow the scope of federally protected activities to nullify the protection that Congress afforded multistate businesses through its enactment of Section 381. Oregon has been at the forefront of the state encroachment effort and crossed the federal line here. The Question presented is: (1) Whether Section 381 immunity applies for Santa Fe Natural Tobacco Company (“Santa Fe”) when it engages in otherwise protected activities in Oregon to solicit requests for orders from retailers if it also sends successfully solicited retailer requests for orders to wholesalers (i.e., Santa Fe’s customers) for wholesalers to accept and process, and, if ultimately