A unanimous South Dakota Supreme Court has ended a three decade old challenge to South Dakota's insurance premium tax statutes in a case handled by DEHS.
The decision is the second by the Court in a lawsuit brought by Metropolitan Life claiming the premium tax statutes were unconstitutional. In March 2008, the Court ruled that South Dakota's current premium tax is constitutional. At the same time, it sent the case back to the trial court to address other issues related to the statutes in effect from 1970 to 1981. On remand, the trial court ruled that, among other things, MetLife failed to comply with the tax refund statutes in effect when it filed refund claims in 1981.
In affirming, the Supreme Court agreed that MetLife had not complied with the procedural requirements of the "protest and suit" statutes, which required taxes be paid under protest before bringing a refund action. The Supreme Court also held that the declaratory judgment action MetLife filed in 2004 -- the litigation that gave rise to the recent appeals -- could not be used to challenge statutes repealed more than 35 years before the lawsuit was brought.
DEHS attorneys Tim Gebhart and Eric Johnson represented the State in the litigation and both appeals.