Tuesday, March 13, 2012

Breaking News on the California Resale Royalty Suit (UPDATED)

Yesterday was the oral argument on the auction houses' motion to dismiss the California resale royaly class action. I don't see any reports online, but a source close to the case tells me that the Court issued a tentative decision dismissing the case on Commerce Clause grounds. (I'm not surprised.) The final decision should follow in the coming weeks.

UPDATE:  Nicholas O'Donnell:  "Essentially, the issue raised by the defendants is whether California can pass a law concerning art re-sales that could affect commerce outside of the state.  If it does, it could run afoul of what lawyers call the Dormant Commerce Clause to the U.S. Constitution.  There is, in fact, no Dormant Commerce Clause.  Rather, the affirmative grant of authority by the Commerce Clause to the U.S. Congress to regulate interstate commerce is taken, by negative implication, to preclude regulation of interstate commerce by the states."