Justia Mississippi Supreme Court Opinion Summaries

Appellants raised a constitutional challenge to a fee legislated on cigarettes distributed through Mississippi for sale outside the state, claiming separate violations of the Commerce and Due-Process Clauses. In 2009, the Mississippi Legislature passed a law imposing a fee on the sale, purchase, and distribution in Mississippi of cigarettes manufactured by companies that did not enter into settlement agreements with the State as a result of a 1997 lawsuit (the "nonsettling manufacturer" or "NSM" law), "including cigarettes sold, purchased or otherwise distributed in this state for sale outside of this state." In October 2009, the chancery court entered a temporary restraining order enjoining the Commissioner of Revenue from assessing and collecting the challenged fee, and later ruled that the legislative amendment did not apply retroactively, denied Appellants' motion for reconsideration, and granted the Commissioner's motion for final judgment. However, the chancery court did not enter final judgment at that time. In 2011, the chancellor entered final judgment, which incorporated an August 2010 order (denying Appellants’ request for a permanent injunction and declaratory relief) and a May 2011 order (denying motion for rehearing and granting motion for final judgment). Appellants raised several issues on appeal; the Supreme Court found that the provision of the NSM law imposing a fee on NSM cigarettes distributed through Mississippi for sale outside the state was not internally consistent in violation of the Commerce Clause. The Court declined to address Appellants' due process argument. Furthermore, the Court found that the chancery court erred in granting claims for attorney fees asserted under 42 U.S.C. 1988 for Appellants' section 1983 challenge to the constitutionality of the NSM law. The Court found that all Appellants had an adequate remedy at state law (declaratory relief under Mississippi Rule of Civil Procedure 57), and as such, the chancery court should have "refrain[ed] from considering Section 1983 claims in tax cases, mooting Section 1988 claims for fees. That being said, no basis exist[ed] for a claim by Appellants for attorney fees." View "Commonwealth Brands, Inc. v. Morgan" on Justia Law

n 1993, AT&T Corporation and affiliate corporations (collectively, AT&T) filed an affiliated group, Mississippi income tax return with the Mississippi Department of Revenue f/k/a Mississippi State Tax Commission, using the statutorily-permissible "combined method" of reporting. But from 1994 to 1996, AT&T filed its returns under the "consolidated method" of reporting, which was then statutorily available only to affiliated groups with members doing business and taxable solely in Mississippi, ostensibly to challenge the constitutionality of this distinction. Following an audit in 1997, the Commission issued an Assessment of Income Taxes of more than $5 million against AT&T. After unsuccessful administrative appeals before the Commission, AT&T filed a "Petition for Appeal of Additional Income Tax Assessment Ordered by State Tax Commission, For Declaratory and Injunctive Relief, and For Refund of Overpayment of Tax" in the Chancery Court of Hinds County. The Petition challenged the constitutionality of several tax statutes under the Commerce Clause of the United States Constitution and sought associated relief. But AT&T's Petition was not 'accompanied with a bond, to be approved by the clerk . . . , in a sum double the amount in controversy[,]" as then required by Mississippi Code Section 27-7-73. Rather, AT&T paid the Assessment, then filed the Petition. Preliminarily, the chancery court found that AT&T had "properly appealed" the full Commission's Order. The chancery court then held that the subject tax statutes violated the Commerce Clause; that the"offensive limitations" were to be struck so that AT&T was granted the "tax benefits" enjoyed by other taxpayers; and, based thereon, that AT&T was entitled to an award of $12,727,174. Thereafter, the Commission appealed those rulings, while AT&T appealed only the chancery court's interest calculations. Because AT&T did not follow the then-applicable procedure for appeal, the chancery court lacked jurisdiction to hear its appeal. The Supreme Court reversed the chancery court and reinstated the Commission's order. View "Mississippi Department of Revenue v. AT&T Corporation" on Justia Law

The Mississippi Department of Revenue (MDOR) issued a subpoena to Pikco Finance, Inc. (Pikco), requesting documentation pertaining to Pikco's nonpayment of finance company privilege taxes. Pikco filed a petition to quash the subpoena on the basis that MDOR's ability to audit and tax under Mississippi's Finance Company Privilege Tax law was preempted by the National Bank Act. The circuit court granted Pikco's petition to quash, and MDOR appealed. The issue on appeal was whether MDOR's use of its statutory subpoena power in administration of the Finance Company Privilege Tax was preempted by the National Bank Act. Upon review, the Supreme Court reversed and remanded, finding that Pikco was subject to the subpoena. View "Mississippi Dept. of Revenue v. Pikco Finance, Inc." on Justia Law

A corporation settled its delinquent tax liability to the State of Mississippi by paying $100 million to the State, $4.2 million to a private charity, and $14 million to a private law firm hired by the Attorney General to pursue the claim. Mississippi's Auditor demanded that, because the $18.2 million paid to the private charity and the law firm constituted public funds, it must be turned over to the State. The charity complied; but the law firm refused, claiming the payment of its fees was not made with public funds and, in any case, the Auditor had waived the State’s claim. The Auditor filed suit and the trial court granted summary judgment to the law firm. The state Auditor appealed. Upon review, the Supreme Court found that when the Attorney General pays special assistants, Mississippi statutory law requires that they be paid from the Attorney General’s contingent fund or from other funds appropriated to the Attorney General's office by the Legislature. Furthermore, the Mississippi constitution requires obligations and liabilities to the State to be paid "into the proper treasury." Neither of these requirements was met in this case. Neither the Attorney General nor the Langston Firm provided sufficient evidence to establish that the Auditor waived the State’s claim to the funds. The Court therefore reversed the circuit court’s judgment and remanded the case for further proceedings. View "Pickering v. Langston Law Firm, P.A." on Justia Law

A corporation settled a lawsuit by agreeing to pay the State of Mississippi $50 million, $10 million of which it disbursed directly to outside counsel retained by Attorney General Hood to pursue the litigation. The chancery court held that the payment was proper. But because the law requires that outside counsel retained by the Attorney General to pursue litigation in "the state or federal courts" be paid from his contingent fund or from other funds the Legislature appropriates to his office, and because the Mississippi Constitution requires obligations and liabilities to the State to be paid "into the proper treasury," the Supreme Court reversed, finding that the Attorney General failed to use his contingent fund. View "Pickering v. Hood" on Justia Law

The issue before the Supreme Court in this case was an appeal by the City of Cleveland of a judgment by the DeSoto County Chancery Court which denied the City's motion for attorney fees. The chancery court found that it lacked jurisdiction to hear the City's appeal. Upon review, the Supreme Court found that, after the Court of Appeals rendered the underlying case and the Supreme Court denied certiorari review, the case was at its end. The chancery court did not thereafter have jurisdiction. Accordingly, the Supreme Court affirmed the finding that the lower court did not have jurisdiction. View "City of Cleveland, Mississippi v. Mid-South Associates, LLC" on Justia Law

The Supreme Court granted certiorari in this matter to address the specific question of whether the requirement to post a pretrial bond set out in Mississippi Code Sections 27-77-5 and 27-77-7 (Rev. 2005) was procedural or jurisdictional. If procedural, it would constitute an intrusion by the Legislature into the assigned powers of this Court and of the judicial branch of government, and a violation of Article 6, Sections 144 and 146 of the Mississippi Constitution. Having considered the issue, the Court found that it's precedent was clear: the requirement of a pretrial bond relates to appellate jurisdiction and is within the powers of the Legislature. Accordingly, the Court affirmed the judgments of the Court of Appeals and of the Chancery Court for the First Judicial District of Hinds County. View "5K Farms, Inc. v. Miss. Dept. of Rev." on Justia Law

In 2006, Petitioner Chander Khurana was audited by the Mississippi State Department of Revenue (MSDR) and assessed taxes. Petitioner appealed the assessments to the Board of Review and eventually the full State Tax Commission, both of which affirmed the assessment. In 2007, Petitioner filed his appeal of the assessments to the Chancery Court; however he did not pay the taxes or post a bond at the time he filed his petition as required by statute. MSDR filed a motion for summary judgment and dismissal, arguing Petitioner failed to perfect his appeal. The chancellor denied the motion and ultimately affirmed the assessments. Petitioner appealed to the Supreme Court claiming the full Commission and chancery court acted arbitrarily and capriciously. MSDR cross-appealed, claiming the chancellor erred in denying its motion for summary judgment and dismissal. Upon review, the Supreme Court concluded Petitioner failed to comply with the statutory requirements of paying the tax or bond. Therefore, the chancery court did not have appellate jurisdiction over Petitioner's appeal, and should have granted MSDR's motion for summary judgment and dismissal. The Court reversed the judgment of the chancery court and rendered judgment for the Mississippi Department of Revenue. Because the chancery court should not have reached the merits of the case, the chancery court's order affirming the assessments was vacated. The order of the Commission remained in effect. View "Khurana v. Mississippi Dept. of Revenue" on Justia Law

The Pascagoula School District (which contains a Chevron crude oil refinery and a Gulf liquified natural gas terminal) brought suit, seeking a declaration that a new law that mandated that revenue the District collected from ad valorem taxes levied on liquified natural gas terminals and crude oil refineries be distributed to all school districts in the county where the terminals and refineries were located was unconstitutional and requesting injunctive relief. All parties filed for summary judgment. After a hearing, the trial judge ruled that the law was constitutional, and the plaintiffs appealed that decision. Because the Supreme Court found the contested statute violated the constitutional mandate that a school district's taxes be used to maintain "its schools," it reversed and remanded the case for further proceedings. View "Pascagoula School District v. Tucker" on Justia Law

The Mississippi Tax Commission (Commission) assessed a contractor’s tax against Walter Akins, d/b/a Akins Construction Company. Akins challenged the assessment administratively. After exhausting his administrative remedies, Akins appealed to the Chancery Court. The chancellor dismissed his complaint for failure to comply with Mississippi Code Section 27-77-7 (Rev. 2005), which required a taxpayer seeking judicial review to pay the amount ordered before filing the petition or attach a security bond, for double the amount in controversy, with the petition to appeal. Akins appealed to the Supreme Court, arguing that he was deprived of his right to due process because the appeal provisions codified in Section 27-77-7 are unconstitutional. Finding that the statute does meet constitutional standards and that Akins failed to pay the tax or post a bond in order to grant jurisdiction to the chancery court, the Court affirmed the chancellor's decision. View "Akins v. Miss. Depart. of Revenue " on Justia Law