Leathers v. Medlock

LOCATION: Oklahoma City Board of Education

DOCKET NO.: 90-29
DECIDED BY: Rehnquist Court (1990-1991)
LOWER COURT: Arkansas Supreme Court

CITATION: 499 US 439 (1991)
ARGUED: Jan 09, 1991
DECIDED: Apr 16, 1991

Eugene G. Sayre - Argued the cause for the petitioners in No. 90-38 and the respondents in No. 90-29
William E. Keadle - Argued the cause for petitioner in No. 90-29 and respondents in No. 90-38

Facts of the case

In 1987, Arkansas amended its Gross Receipts Act (GRA), imposing a tax on cable television but not on print media. Cable companies and others filed suit in the State Chancery Court, alleging that taxing cable services, but not print and satellite broadcast services, violated their First Amendment expressive rights and 14th Amendment equal protection rights. In 1989, after the Chancery Court upheld the amendment, Arkansas again amended the GRA, extending the tax to satellite broadcast services. On appeal, the State Supreme Court upheld the GRA. However, the court ruled that the First Amendment prohibits differential taxation among members of the same medium. Therefore, because cable and scrambled satellite television services are essentially the same, the tax was unconstitutional when it applied only to cable services.


Does differential taxation of different media violate the First and 14th Amendments? Does differential taxation of members of the same medium violate the First and 14th Amendments?

Media for Leathers v. Medlock

Audio Transcription for Oral Argument - January 09, 1991 in Leathers v. Medlock

Audio Transcription for Opinion Announcement - April 16, 1991 in Leathers v. Medlock

William H. Rehnquist:

The opinions of the Court in Leathers and Medlock, and Medlock against Leathers will be announced by Justice O'Connor.

Sandra Day O'Connor:

These consolidated cases come to us on writs of certiorari to the Supreme Court of Arkansas.

Arkansas imposes a sales tax on all tangible personal property and on a wide range of services.

In 1987, Arkansas included for the first time a sales tax on cable television services.

A cable television subscriber, an operator, and a trade association representing cable operators in Arkansas, challenge the application of the sales tax to cable services and the exemption or exclusion from the tax of newspaper sales, subscription magazine sales, and sales of scrambled satellite broadcast television service to home dish antenna owners.

In the Arkansas Chancery Court, they argued that the tax violated their constitutional rights under the First Amendment and under the Equal Protection Clause of the Fourteenth Amendment.

Shortly after the Chancery Court upheld the constitutionality of the sales tax, Arkansas' legislature extended the tax to scramble satellite television services.

On appeal, the State Supreme Court held that the sales taxation of cable television services did not violate the First Amendment after its extension to scramble satellite television.

Believing, however, that the First Amendment prohibits discriminatory taxation among members of the same medium and that cable and scramble satellite television services were substantially the same, the Supreme Court of Arkansas held that the tax violated the First Amendment for that period during which, it applied to cable but not to scramble satellite services.

Both the cable petitioners and the Arkansas Commissioner of Revenue petitioned this Court for certiorari.

We granted the petitions to decide whether the First Amendment prohibits or prevents a state from exempting or excluding from its sales tax only certain segments of the media.

We conclude that Arkansas' extension of its generally applicable sales tax to cable television services alone or to cable and satellite services, while exempting the print media did not violate the First Amendment.

Arkansas' sales tax presents none of the First Amendment difficulties that have led us to strike down differential taxation among members of the press in the past.

Unlike our previous cases, this case involves a generally applicable sales tax that does not single out the press for special treatment.

There is no indication that Arkansas has targeted cable television in a purposeful attempt to interfere with its First Amendment activities, nor is the tax structured so is to raise suspicion that it was intended to do so.

Moreover, the tax is not content based.

We hold that differential taxation of speakers does not violate the First Amendment unless the tax is directed at or presents the danger of suppressing particular ideas.

Arkansas' exemption or exclusion of certain media from its sales tax has not suggested any interest in censoring the expressive activities of cable television, nor is there an indication that the tax is likely to stifle the free exchange of ideas.

We leave the question of whether the state's temporary tax distinction between cable and satellite services violated the Fourteenth Amendment's Equal Protection Clause to the Arkansas Supreme Court for consideration on remand.

Justice Marshall has filed a dissenting opinion which Justice Blackmun has joined.