Commonwealth Edison Co. v. Montana
United States Supreme Court
453 U.S. 609, 101 S. Ct. 2946 (1981)
- Written by Heather Whittemore, JD
Facts
Montana levied a severance tax on each ton of coal mined in the state, including coal mined on federal land. A group of Montana coal producers and out-of-state utility companies (collectively, the mining companies) (plaintiffs) filed a lawsuit in Montana state court asking for a refund of over $5 million in severance taxes and arguing that Montana’s severance tax violated the Commerce Clause of the United States Constitution. The trial court upheld the tax without conducting a trial. The Montana Supreme Court affirmed the trial court, reasoning that the severance tax on coal did not violate the Commerce Clause because interstate commerce was not implicated. Rather, the severance tax was an intrastate tax on coal production inside Montana. Alternately, the Montana Supreme Court argued that the severance tax was valid under Complete Auto Transit, Inc. v. Brady, 430 U.S. 274 (1977), a United States Supreme Court decision that provided a four-part test to assess whether a state tax was valid under the Commerce Clause. The mining companies appealed, arguing that the severance tax was not valid under Complete Auto because the amount of tax money Montana received from the mining companies exceeded the cost of the services the state provided to the mining companies. The United States Supreme Court granted certiorari.
Rule of Law
Issue
Holding and Reasoning (Marshall, J.)
Concurrence (White, J.)
Dissent (Blackmun, J.)
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