This educational guide is based on the linked primary sources. It is not a Court publication, is not affiliated with the Court, and is not legal advice.
In brief
Overview
According to Mr. Leatherwood, the case involves a dispute between California and Nevada over whether Nevada must honor California's tax immunity statutes.
The Nevada court dismissed a related declaratory judgment action to avoid addressing the issue.
Background and question before the Court
Justice Ginsberg asked whether the Court should overrule Nevada v. Hall or treat this case as different because it involves core sovereign functions.
Justice Stevens asked whether a hypothetical California statute authorizing thumbscrews would grant absolute immunity in Nevada.
A Justice inquired whether the Court would ask to overrule Nevada v. Hall if footnote 24 lacks sufficient guidance for stable jurisprudence.
According to Justice Kennedy, justice Kennedy questioned whether Nevada could sue California under a parens patriae theory if California officials acted pervasively in Nevada.
What each side argues
Franchise Tax Board of California
According to Franchise Tax Board of California, the FTBC argued that the case is analogous to the Federal Tax Injunction Act fair assessment jurisprudence, where the federal government backs off from managing state taxes.
Mr. Leatherwood
According to Mr. Leatherwood, he argued that Nevada's failure to recognize California's immunity statute violates the Full Faith and Credit Clause and constitutes hostility.
According to Mr. Leatherwood, he contended that the Full Faith and Credit Clause would not force Nevada to apply a California thumbscrew statute because it lies outside the tax function.
Mr. Farr
According to Mr. Farr, he expressed that the issue is not about choosing between California and Nevada law, but about determining which Nevada law would apply.
According to Mr. Farr, he suggested that neighboring states could reach reciprocal agreements to address such disputes.
What happened at oral argument
Justice Ginsberg asked Mr. Leatherwood whether to overrule Nevada v. Hall or treat the case as different because it involves core sovereign functions.
Justice Stevens asked whether a hypothetical California thumbscrew statute would grant absolute immunity in Nevada.
A Justice asked whether the Court would overrule Nevada v. Hall if footnote 24 lacked sufficient guidance.
According to Justice Kennedy, justice Kennedy raised the possibility that Nevada might sue California under a parens patriae theory if California officials acted pervasively in Nevada.
What the Court decided
Why it matters
According to Mr. Leatherwood, the dispute raises an issue about whether Nevada's refusal to recognize California's tax immunity statute may violate the Full Faith and Credit Clause.
Participants noted that neighboring states could reach reciprocal agreements to address such tax‑related disputes, suggesting possible implications for inter‑state cooperation.
Terms to know
No glossary terms are available for this guide.
Primary sources
Read the source materials on the official site or open the immutable repository copy used for this guide.
- f52956497c23a183fa44-r1-d87ef8ddee07a499.pdforal argument transcript
Guide generated September 20, 2026. Automated validation accepted this version.