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Supreme Court of NC Declines Google Tax Case

The Supreme Court of North Carolina has declined to review a case that challenged the constitutionality of tax incentives promised to Google to induce the company to establish a facility in Caldwell County.

The North Carolina Institute for Constitutional Law filed the case. From its website, NCICL offered this summary:

Representing three individual plaintiffs, NCICL filed a lawsuit in Wake County Superior Court challenging legislation which granted Google an exemption from certain retail sales and use taxes and the award of Job Development Investment Grants. The lawsuit alleges that the tax credits and grants given to Google violated various provisions of the state constitution, including the Public Purpose and Exclusive Emoluments Clauses. The total handout to Google could top $260 million, including the challenged “incentives” from the State which total approximately $90 million.

The case, Munger, et al. v. State of N.C., et al., was filed in Wake County Superior Court. Superior Court Judge Paul C. Ridgeway dismissed the case. The Court of Appeals upheld the dismissal in an Opinion written by Judge Sam Ervin IV with Judges John C. Martin and Barbara Jackson concurring.

The Court of Appeals concluded that the plaintiffs did not have standing to bring the case. To have standing, the plaintiffs had to allege that they were sufficiently affected the tax credits promised to Google.

The Supreme Court of North Carolina is the state’s highest appellate court. In most instances, there is a right of appeal from the state trial courts to the North Carolina Court of Appeals. However, in many instances, there is no right of appeal to the Supreme Court of North Carolina. In such instances, such as this case, the losing party has to file a petition requesting the Supreme Court to hear the case.

The Supreme Court previously declined to hear a similar case brought by NCICL challenging tax credits promised to Dell.

According to its website, The Supreme Court of North Carolina issued 62 opinions during 2010.

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