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 Beth S. Brinkmann, petitioner argues that the Illinois appellate court’s ruling dramatically expanded the state’s operational‑function tax, which the petitioner says violates constitutional limits on state taxing authority.
According to Barov, respondent contends that the tax is calculated using a two‑factor formula based on Mead’s sales, not on the activities of Lexis/Nexis.
Background and question before the Court
The case concerns Illinois’s operational‑function tax and whether it can be applied to MeadWestvaco’s sales, with questions about the unitary‑business doctrine.
The key legal question is whether the unitary‑business doctrine applies, allowing Illinois to tax the sale, or whether the tax results in prohibited double taxation.
What each side argues
Petitioner Position (MEADWESTVACO CORPORTATION SUCCESSOR IN INTEREST TO THE MEAD CORPORATION)
According to Beth S. Brinkmann, petitioner asserts that the tax violates constitutional limits on state taxing authority because the operational‑function tax was improperly expanded.
According to Ms. Brinkmann, petitioner further argues that Illinois rule 341(h)(7) and (i) requires the issue to be raised in the appellate court, and because it was not, the tax claim is waived as an independent and adequate state ground.
Respondent Position (ILLINOIS DEPARTMENT OF REVENUE)
According to Barov, respondent maintains that the tax is calculated using a two‑factor formula tied to Mead’s sales, not to Lexis/Nexis activities.
According to Barov, respondent points to a detailed stipulation and accompanying exhibits that describe the relationship between Mead and Lexis/Nexis.
According to Barov, respondent relies on the Mobil Oil precedent, arguing that the possibility of taxation by another state does not preclude Illinois taxation.
What happened at oral argument
According to Chief Justice Roberts, chief Justice Roberts opened the argument, noting the case will be heard.
Justice Souter asked whether the trial court had found the business to be non‑unitary and whether that finding was undisturbed on appeal.
According to Justice Kennedy, justice Kennedy inquired whether, assuming the unitary‑business argument is met, Illinois has the right to tax the sale or part of it.
According to Justice Stevens, justice Stevens questioned how the tax amount was computed if the unitary‑business approach was not applied.
According to Justice Scalia, justice Scalia clarified that the tax is imposed on Mead, not on Lexis/Nexis.
According to Justice Ginsburg, justice Ginsburg raised the issue of potential double taxation if Ohio were to tax the entire gain.
- [1] 24cba723790e4fd6f6bb-r1-7a06624cf9c524c7.pdf, p. 56
- [2] 24cba723790e4fd6f6bb-r1-7a06624cf9c524c7.pdf, p. 20
- [3] 24cba723790e4fd6f6bb-r1-7a06624cf9c524c7.pdf, p. 26
- [4] 24cba723790e4fd6f6bb-r1-7a06624cf9c524c7.pdf, p. 38
- [5] 24cba723790e4fd6f6bb-r1-7a06624cf9c524c7.pdf, p. 48
- [6] 24cba723790e4fd6f6bb-r1-7a06624cf9c524c7.pdf, p. 47
What the Court decided
Why it matters
The case addresses the scope of state authority to tax multistate corporations under the unitary‑business doctrine.
According to Barov, the arguments describe how the tax calculation considers the relationship between Mead and Lexis/Nexis, reflecting considerations relevant to operational‑function taxes.
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.
- 24cba723790e4fd6f6bb-r1-7a06624cf9c524c7.pdforal argument transcript
Guide generated September 22, 2026. Automated validation accepted this version.