A Virginia statute gives circuit courts original jurisdiction to hear declaratory judgment actions brought by businesses to challenge another state’s assertion of sales or use tax nexus. Va. Code Ann. § 8.01-184.1. In a case of first impression, on October 9, 2019, a Virginia circuit court granted the Massachusetts Department of Revenue’s motion to dismiss such a suit challenging the Department’s “cookie nexus” standard for sales tax collection. The Department notified the plaintiff, a Virginia-based company, of the cookie nexus standard in three separate letters. The plaintiff did not allege that the Department had any other contacts with the plaintiff in Virginia. The court dismissed the litigation, finding that the Department’s three letters sent to plaintiff were insufficient to establish jurisdiction under the Due Process Clause of the 14th Amendment of the United States Constitution.

Crutchfield v. Commonwealth of Massachusetts, No. No. CL17001145-00 (Va. Commw. Ct. Oct. 9, 2019).