Source: https://supreme.justia.com/cases/federal/us/385/355/
Timestamp: 2019-04-22 19:59:06+00:00

Document:
Appellee American National Red Cross, claiming immunity as a "federal instrumentality" from the Colorado unemployment compensation tax, together with the United States, brought this suit in a three-judge federal District Court to enjoin enforcement as to it of the tax statute, and for a refund. From that court's ruling in favor of appellees, this direct appeal was taken.
1. The three-judge court had jurisdiction to enjoin a state tax upon an organization claiming immunity as a federal instrumentality. Query v. United States, 316 U. S. 486, followed. P. 385 U. S. 357.
2. The Tax Injunction Act (28 U.S.C. § 1341), prohibiting district courts from enjoining the collection of state taxes where a "plain, speedy and efficient" state court remedy is available, does not restrict a suit by the United States to enjoin the unconstitutional imposition of state taxes; nor does the Eleventh Amendment bar the action. Pp. 385 U. S. 357-358.
3. The Red Cross is clearly an instrumentality of the United States for purposes of immunity from state taxation on its operations, and Congress has not waived its immunity.
MR. JUSTICE FORTAS delivered the opinion of the Court.
Act (26 U.S.C. § 3301 et seq.), and that, in any event, the Red Cross had failed to exhaust available administrative and state judicial remedies. The three-judge federal District Court, American National Red Cross v. Department of Employment, 263 F.Supp. 581, ruled in favor of the Red Cross and the United States on each of these issues, ordered a refund of taxes already paid, and enjoined enforcement of the tax statute against the Red Cross. Pursuant to 28 U.S.C. § 1253, [Footnote 3] the Department of Employment and its executive director sought direct review here. In setting the case for argument, we postponed consideration of questions pertaining to our jurisdiction and that of the three-judge court. 384 U.S. 949 (1966).
Act (28 U.S.C. § 1341) [Footnote 5] requires appellees first to exhaust their state remedies, which are alleged by appellants to be "plain, speedy and efficient." We need not decide whether omission to provide interest on a successful refund application renders the state remedy here an inadequate one within the meaning of § 1341. For we conclude, in accord with an unbroken line of authority, [Footnote 6] and convincing evidence of legislative purpose, [Footnote 7] that § 1341 does not act as a restriction upon suits by the United States to protect itself and its instrumentalities from unconstitutional state exactions. With respect to appellants' contention that the State of Colorado has not consented to suit in a federal forum even where the plaintiff is the United States, see Principality Monaco v. Mississippi, 292 U. S. 313 (1934), and Ex parte Young, 209 U. S. 123 (1908).
Government. [Footnote 12] In those respects in which the Red Cross differs from the usual government agency -- e.g., in that its employees are not employees of the United States, and that government officials do not direct its everyday affairs -- the Red Cross is like other institutions -- e.g., national banks -- whose status as tax-immune instrumentalities of the United States is beyond dispute.
"exempt from the tax imposed by section 3301 by virtue of any provision of law which specifically refers to such section . . . in granting such exemption."
26 U.S.C. § 3306(c)(6)(B). Although § 3306(c)(8), which exempts from the federal tax "service performed in the employ of a [charitable institution]," does not contain an explicit citation to § 3301, its sole function is to exempt certain employment from the reach of that section. We hold that federal instrumentalities like the Red Cross, exempted from the federal tax by virtue of § 3306(c)(8), are likewise exempt from state taxation under § 3306(c)(6)(B).
The other States are Alaska and Hawaii. See Alaska Stat. § 23.20.525(c) (7) (1962); Hawaii Rev.Laws § 93-7(i) (Supp.1963).
"An interlocutory or permanent injunction restraining the enforcement, operation or execution of any State statute by restraining the action of any officer of such State . . . shall not be granted by any district court or judge thereof upon the ground of the unconstitutionality of such statute unless the application therefor is heard and determined by a district court of three judges under section 2284 of this title."
Section 1253 authorizes direct appeal to this Court from an order granting an injunction in any proceeding "required by any Act of Congress to be heard and determined by a district court of three judges."
See also United States v. Georgia Pub. Serv. Comm'n, 371 U. S. 285, 371 U. S. 287 (1963); Paul v. United States, 371 U. S. 245, 371 U. S. 249-250 (1963). Compare Currie, The Three-Judge District Court in Constitutional Litigation, 32 U.Chi.L.Rev. 1, 37-50 (1964), with Note, The Three-Judge District Court: Scope and procedure Under Section 2281, 77 Harv.L.Rev. 299, 312-313 (1963).
"The district courts shall not enjoin, suspend or restrain the assessment, levy or collection of any tax under State law where a plain, speedy and efficient remedy may be had in the courts of such State."
United States v. Arlington County, Commonwealth of Virginia, 326 F.2d 929, 931 (C.A.4th Cir. 1964); United States v. Bureau of Revenue of State of N.M., 291 F.2d 677, 679 (C.A.10th Cir. 1961); United States v. Woodworth, 170 F.2d 1019 (C.A.2d Cir. 1948); City of Springfield v. United States, 99 F.2d 860, 862 (C.A.1st Cir. 1938), cert. denied, 306 U.S. 650, (1939); United States v. Livingston, 179 F.Supp. 9, 11-12 (D.C.E.D.S.C.1959), aff'd, 364 U. S. 281 (1960).
See S.Rep. No. 1035, 75th Cong., 1st Sess., pp. 2-3 (1937); H.R.Rep. No. 1503, 75th Cong., 1st Sess., p. 2-3 (1937); 81 Cong.Rec. 1416-1417 (1937).
E.g., Geneva Convention of August 22, 1864, for the Amelioration of the Wounded in Armies in the Field, 22 Stat. 940 (1882); Geneva Convention of July 27, 1929, For the Amelioration of the Condition of the Wounded and the Sick of Armies in the Field, 47 Stat. 2074 (1932); Geneva Convention of August 12, 1949, For the Multilateral Protection of War Victims, 6 U.S.T. & O.I.A. 3114, T.I.A.S. No. 3362.
See, e.g., 10 U.S.C. § 2602; 33 Stat. 600, as amended, 36 U.S.C. § 3.
See 33 Stat. 600, as amended, 36 U.S.C. § 3; 64 Stat. 1109, 42 U.S.C. §§ 1855-1855g.
See e.g., 46 Stat. 66, as amended, 36 U.S.C. § 13 (permanent headquarters building).
See, e.g., Proclamation of President Taft, August 22, 1911, 37 Stat. 1716; 64 Stat. 1109, 42 U.S.C. §§ 1855a(f), 1855b, 1855c; H.Cong.Res. 232, 70 Stat. B32 (1956); H.R.Rep. No. 1728, 82d Cong., 2d Sess., p. 2 (1952).
Such was the opinion of Assistant Attorney General McKevitt, who so informed appellant Department of Employment. See letter of the Assistant Attorney General to appellee Red Cross, dated November 21, 1960, exhibit 2, in support of appellees' motion for summary judgment below.

References: v. 
 § 1341
 § 3301
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 § 1253
 § 1341
 § 1341
 § 1341
 v. 
 § 3306
 § 3306
 § 3301
 § 3306
 § 3306
 § 23
 § 93
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 § 2602
 § 3
 § 3
 § 13