ELR Citation: 53 ELR 20022
No(s). 21-6069 (6th Cir. Feb 3, 2023)

The Sixth Circuit reversed a district court's denial of a preliminary injunction in a lawsuit concerning a Kentucky law that offsets the state's severance tax on coal. A coal producer from Illinois, where there is no severance tax, argued the law discriminated against out-of-state coal in violation of the dormant Commerce Clause, and moved for a preliminary injunction. The district court concluded the producer was not likely to succeed on the merits and denied the motion. The appellate court found the effect of the law was to make out-of-state coal more expensive, which will cause that coal to either lose market share or have to lower its price to compete, constituting impermissible discrimination against commerce. It reversed and remanded for further proceedings.