Overstock.com, Inc. v. New York State Department of Taxation & Finance, 20 N.Y.3d 586

Amazon and Overstock challenge New York Tax Law § 1101(b)(8)(vi) (the Internet tax) as unconstitutional on its face under the Commerce and Due Process Clauses.
The statute presumes that a seller is soliciting business in New York through in-state residents who refer customers via internet links if referrals exceed $10,000 in the prior four quarters, unless rebutted.
Both plaintiffs operate solely online with no physical presence in New York; they use affiliate programs where in-state residents are paid commissions for referred sales.
DTF issued guidance memo clarifying that mere advertising is not subject to the presumption, and outlining rebuttal mechanisms via contractual prohibitions and annual certifications.
A second memo refined rebuttal requirements to require contract prohibition of in-state solicitation and annual certifications from resident representatives.
The Appellate Division reinstated as-applied challenges, but the issues were resolved on facial challenges; the trial court decisions dismissing the complaints were affirmed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Commerce Clause facial validity	Amazon/Overstock contend statute is facially invalid absent substantial nexus.	State maintains substantial nexus via in-state solicitation by residents.	Statute facially valid under Commerce Clause.
Due Process facial validity	Presumption irrational and irrebuttable.	Presumption rationally follows from referral-based compensation and can be rebutted.	Statute facially valid under Due Process.
Sufficiency of the rebuttal mechanism	Rebuttal burdens cannot fix an unconstitutional presumption.	DTF's contractual prohibition plus annual certification provide a workable rebuttal.	Rebuttal mechanism adequate; statute not facially invalid.

National Bellas Hess, Inc. v. Department of Revenue of Illinois, 386 U.S. 753 (U.S. 1967) (physical presence required for use tax on remote sellers)
Quill Corp. v. North Dakota, 504 U.S. 298 (U.S. 1992) (physical presence rule retained; governing precedent)
Orvis Co. v. Tax Appeals Trib. of State of New York, 86 N.Y.2d 165 (N.Y. 1995) (in-state presence needed; basis for nexus standard)
Moran Towing Corp. v. Urbach, 99 N.Y.2d 443 (N.Y. 2003) (multifactor test for substantial nexus in Moran analysis)
Complete Auto Transit, Inc. v. Brady, 430 U.S. 274 (U.S. 1977) (four-part test for state taxes affecting interstate commerce)
Tot v. United States, 319 U.S. 463 (U.S. 1943) (rational connection standard for presumptions)
Leary v. United States, 395 U.S. 6 (U.S. 1969) (presumptions must have high probability of tracing to proven facts)
People v. Leyva, 38 N.Y.2d 160 (N.Y. 1975) (rational connection and proof standards for presumptions)
National Geographic Soc. v. California Bd. of Equalization, 430 U.S. 551 (U.S. 1977) (economic presence standards and nexus considerations)