Investment Incentives, and the Future of
the Dormant Commerce Clause Doctrine
Brannon P. Denning*
In DaimlerChrysler Corp. v. Cuno,1 one of the 2005 term’s closelywatched cases, the Supreme Court declined to decide whether tax incentives commonly used by states and municipalities to attract corporate investment violated the dormant Commerce Clause doctrine (DCCD). In a unanimous opinion by Chief Justice Roberts, the Court held that the state taxpayer plaintiffs in the case did not have standing to challenge the franchise tax credit offered by Ohio to manufacturers who made certain capital investments in the state.2 The decision means that the case will be returned to the Ohio state courts, where it was initially brought by the plaintiffs. Thus, U.S. Supreme Court review of the merits of the case—if any—will have to await further litigation.
The outcome was anticipated,3 even welcomed,4 by legal scholars. But Cuno, along with another closely-watched case from North
* Associate Professor of Law and Director of Faculty Development, Cumberland School of Law at Samford University.
1 126 S. Ct. 1854 (2006).
2 Id. at 1865.
3 See, e.g., Kristin E. Hickman, How Did We Get Here Anyway?: Considering the Standing Question in DaimlerChrysler v. Cuno, 4 Geo. J.L. & Pub. Pol’y 47 (2006); Kristin E. Hickman & Donald B. Tobin, Taxpayer Standing and DaimlerChrysler v. Cuno: Where Do We Go From Here?, Tax Notes, Feb. 20, 2006, at 863.
4 See, e.g., Brannon P. Denning, Cuno and the Court: The Case for Minimalism, 4 Geo. J.L. & Pub. Pol’y 33 (2006) (urging the Court to write a “minimalist” opinion; suggesting that a decision disposing of the case on standing would be one option open to the Court).