The U.S. Supreme Court won’t hear a dispute between Arizona and California over the constitutionality of a California tax on commercial activity.
Arizona sued California in February, challenging its $800 minimum franchise tax on limited liability companies “doing business” in California. The tax applies to businesses that exceed specified thresholds for sales, property ownership, or compensation in California. Arizona was able to file its initial suit directly with the Supreme Court because the high court can assert original jurisdiction over disputes between state governments.
The Supreme Court on Monday denied leave to file a bill of complaint. Justice Clarence Thomas, joined by Justice Samuel Alito, dissented from the court’s decision not to hear the case. The court doesn’t have the option to turn away suits between two states, they argued.
But the court’s refusal to hear the case isn’t unusual.