Styczinski v. Arnold
| Decision Date | 31 August 2022 |
| Docket Number | 21-2936 |
| Citation | 46 F.4th 907 |
| Parties | Thomas John STYCZINSKI; Tom "The Coin Guy", LLC; Treasure Island Coins, Inc.; Numismatist United Legal Defense, Plaintiffs - Appellants v. Grace ARNOLD, in her official capacity as Commissioner of the Minnesota Department of Commerce, Defendant - Appellee |
| Court | U.S. Court of Appeals — Eighth Circuit |
46 F.4th 907
Thomas John STYCZINSKI; Tom "The Coin Guy", LLC; Treasure Island Coins, Inc.; Numismatist United Legal Defense, Plaintiffs - Appellants
v.
Grace ARNOLD, in her official capacity as Commissioner of the Minnesota Department of Commerce, Defendant - Appellee
No. 21-2936
United States Court of Appeals, Eighth Circuit.
Submitted: July 8, 2022
Filed: August 31, 2022
Counsel who presented argument on behalf of the appellant was Erick G. Kaardal, of Minneapolis, MN.
Counsel who presented argument on behalf of the appellee was Allen Cook Barr, AAG, of Saint Paul, MN. The following attorney(s) appeared on the appellee brief; Christopher M. Kaisershot, AAG, of Saint Paul, MN.
Before SHEPHERD, GRASZ, and KOBES, Circuit Judges.
GRASZ, Circuit Judge.
Appellants (the "Bullion Traders") are a collection of in-state and out-of-state precious metal traders or representatives thereof challenging the constitutionality of Minnesota Statutes Chapter 80G, which regulates bullion transactions. The Bullion
Traders argue the statute violates the dormant Commerce Clause. We agree.
I. Background
The Bullion Traders sued the Minnesota Commissioner of Commerce (the "Commissioner") under 42 U.S.C. § 1983, seeking both declaratory and injunctive relief, claiming (among other things) that Chapter 80G is unconstitutional under the dormant Commerce Clause because it has an extraterritorial effect and excessively burdens interstate commerce. The Bullion Traders moved for summary judgment, and the Commissioner moved to dismiss. The district court partially granted and partially denied the Bullion Traders’ motion for summary judgment and partially granted and partially denied the Commissioner's motion to dismiss. The district court concluded part of Chapter 80G violated the dormant Commerce Clause but held the remainder of Chapter 80G withstood the Bullion Traders’ constitutional challenges. The district court determined the unconstitutional sections of Chapter 80G were severable from the valid provisions and thus upheld those valid provisions.
The Bullion Traders appeal, arguing the district court should have found the entirety of Chapter 80G unconstitutional. Particularly, the Bullion Traders argue Chapter 80G's registration scheme and surety bond requirement are extraterritorial and excessively burden interstate commerce and that those provisions are inseverable from the remainder of Chapter 80G.
After the parties briefed and argued this appeal, the Governor of Minnesota signed 2022 Minn. Sess. Law Serv. ch. 75 (H.F. 4030) into law, which took effect on August 1, 2022, and substantially amended Chapter 80G. We requested and received supplemental briefing from the parties regarding the impact of H.F. 4030 on this appeal. The Bullion Traders maintain their argument that Chapter 80G is extraterritorial and excessively burdens interstate commerce, and the Commissioner maintains her defense that Chapter 80G only regulates conduct connected to Minnesota and does not excessively burden interstate commerce.
Chapter 80G as amended by H.F. 4030 regulates "dealers" and their "Minnesota transactions." A "dealer" is "any person who buys, sells, solicits, or markets bullion products or investments in bullion products to consumers and conducts Minnesota transactions."1 Minn. Stat. § 80G.01, subd. 3(a). A "Minnesota transaction" is a "bullion product transaction" made:
(1) by a dealer that is incorporated, registered, domiciled, or otherwise located in Minnesota;
(2) by a dealer representative at a location in Minnesota;
(3) between a dealer and a consumer who lives in Minnesota; or
(4) between a dealer and a Minnesota consumer when the transaction involves:
(i) delivering or shipping a bullion product to an address in Minnesota;
(ii) delivering to or shipping from a precious metal depository on behalf of a Minnesota resident; or
(iii) making payment to a consumer or receiving a payment from a consumer at an address in Minnesota, unless the transaction occurs when the consumer is at a business location outside of Minnesota.
Id. § 80G.01, subd. 5a.
"It is unlawful for a dealer or dealer representative to conduct a Minnesota
transaction without being registered by the [C]ommissioner[.]" Minn. Stat. § 80G.02, subd. 1. A dealer must apply to register within forty-five days after conducting at least $25,000 in Minnesota transactions between July 1 and the following June 30 of any one-year period. Id. Dealers must annually renew their registration. Id. § 80G.02, subds. 1, 2. A dealer who conducts bullion transactions without being properly registered is guilty of a misdemeanor. Id. § 80G.08.
A dealer must also maintain a surety bond. Id. § 80G.06, subd. 1. The amount of the surety bond required is based on the amount of Minnesota transactions the dealer conducted twelve months before registration or renewal. Id. The...
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