WASHINGTON, DC — On April 5th, the ACMA (American Catalog Mailers Association), the largest trade association representing the direct marketing/e-commerce/catalog industry, filed a complaint in New York State’s Supreme Court, contending that a recently-issued New York Department of Taxation and Finance regulation, 20 N.Y.C.R.R. § 1-2.10, wrongly and substantially expands the reach of taxes on out-of-state merchants with no business activities in the Empire State other than soliciting sales. The New York regulation effectively negates a well-established federal statute, Public Law 86-272, which protects against over-expansive state tax regulation.
“Like the California Franchise Tax Board before it, the New York State Department of Taxation and Finance is overriding federal law by requiring companies with no people or equipment in New York to pay income taxes to New York without any representation,” said ACMA President & Executive Director Michael Plunkett. “Under the New York rule, this would occur even though members do not receive any of the legal and other benefits New York businesses receive from the state.”
The ACMA successfully defeated California’s efforts to efface Public Law 86-272. “And we will continue to protect our small and mid-sized members against the kind of overreach we’ve seen in California and New York,” Plunkett added. If the rule is enforced, ACMA members could be liable for income tax to multiple states for the same income. Not only that, the Department has announced it will apply this rule, published in December 2023, retroactively to January 2015. The substantial liabilities for tax, interest, and penalties created by this rule are untenable for smaller retailers — not to mention contrary to law.
Suit Warranted After NY Rejects Comments
Before the regulation was issued, the ACMA submitted comments to the Department explaining why the New York regulation conflicts with federal law. It pointed out that New York treats “activities on the Internet,” such as responding to customer emails or live chats, as if they occurred in New York. But the regulation has no regard to whether the responding business has any people, offices, or equipment in New York.
The ACMA had sought to avoid this litigation through comments to the Department during the regulatory process. The Department rejected the substance of these arguments and similar criticisms by others, which forced the ACMA’s hand. “So we filed suit to protect our members just as we did two years ago against the California Franchise Tax Board,” Plunkett said.
The ACMA is being represented by attorneys Martin Eisenstein, David Swetnam-Burland, and Nathaniel Bessey of the Maine law firm of Brann & Isaacson, which represented the ACMA in the successful California litigation and has represented the ACMA and the direct/e-com/catalog industry for years, along with co-counsel David Gise of Rivkin Radler LLP.
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Lynn Noble is ACMA’s Vice President, Industry Relations, having joined the ACMA in May 2015, following an extensive direct marketing career in private industry as well as the US Postal Service. He is responsible for leading the membership development efforts for the ACMA through new member acquisitions and providing enhanced member value.
Throughout his career, Lynn has held key marketing & sales positions with several leading direct marketers, as well as several high-level management positions with the US Postal Service.
In 2009, at the request of the ACMA, the US Postal Service initiated a new position of Catalog Manager to lead the Service’s efforts to stabilize and grow the catalog industry. Lynn returned to the USPS to lead those efforts and was instrumental to developing a stronger industry partnership between the Postal Service and the catalog industry. Serving as the product manager for catalogs, Lynn helped to raise the awareness of catalog-specific business challenges within the executive ranks of the USPS. During his tenure, the ACMA and catalog companies enjoyed a collaborative and progressive environment that produced more stabilized rates and inclusion in key USPS promotional opportunities.
Just prior to joining the ACMA Lynn was the USPS’s Manager, Strategic Account Operations, leading a team of senior sales professionals who focused exclusively in the Catalog, Mail Order, and E-commerce arena. In addition to his Postal positions, Lynn previously held key positions with leading direct marketing companies, including Cox Target Media, Market Logic, Catalina Marketing, Freesamples.com, and Advantage Direct.
Named Vice President & Deputy Director in January 2010, Miller came to the ACMA following a lengthy career of more than two decades following the catalog/multichannel/e-commerce/retail businesses. Reporting to ACMA president & executive director Hamilton Davison, Miller oversees marketing and communications, membership development, and organizes and oversees ACMA’s National Catalog Forum, while working with Davison on most of ACMA’s postal-related efforts.
Miller started his career as a reporter with Catalog Showroom Business, following a form of retailing that was led by the likes of the Service Merchandise and Best Products retail chains.
After several years of editor/reporter roles with business magazines that followed the toy and gift industries, Miller was named associate editor of Catalog Age magazine (now Multichannel Merchant) in 1986. He rose up the ranks at Catalog Age over the next 18 years to be the magazine’s senior news editor.
Beginning in the late ’80s, Miller became Catalog Age’s postal beat reporter, where he’d follow key postal events and pull out the key catalog mail-related issues for readers. During that time, he attended many Mailers Technical Advisory Committee (MTAC) meetings and National Postal forums.
After leaving Catalog Age in 2004, Miller consulted with several catalogers and multichannel suppliers for a time, he was named news/website editor at Commercial Property News. Less than a year later, he was asked to take the reigns at Catalog Success (now All About ROI) where he served as editor-in- chief from 2006 till the end of 2009.
ACMA appointed Michael K. Plunkett as its President and Executive Director in January 2024, succeeding founder Hamilton Davison. Mr. Davison moved on to own and run a company. Mr. Plunkett brings years of executive leadership experience having been the President and CEO of the Association for Postal Commerce (PostCom) since 2017. In the newly-formed dual role, he will continue his current role with PostCom and the two organizations will operate separately.
During his tenure, PostCom has continued to lead the mailing and shipping industry on policy and regulatory matters and to work with Government agency partners to advance issues of importance to members. Mr. Plunkett is also President of the Delivery Technology Advocacy Council, a nonprofit launched in 2020 to concentrate on delivery and logistics technologies.
Prior to PostCom, Mr. Plunkett accumulated more than 25 years Postal experience with the United States Postal Service in numerous executive roles in operations, marketing, product development and pricing. As a leader within the Postal Service’s management team, Mr. Plunkett developed a well-earned reputation for innovation by leading efforts to develop pricing agreements for domestic services and in the development of the forever stamp and the priority mail flat rate box.
Mr. Plunkett has testified on pricing and policy issues before the Postal Regulatory Commission and Congressional subcommittees. He has authored and presented papers on postal policies, economics, and operations for National and International conferences.
Mr. Plunkett holds Masters Degrees in Business from the Wharton School at the University of Pennsylvania and the Massachusetts Institute of Technology, where he was a Sloan Fellow. He earned a Bachelor Degrees in Economics and Finance from the Pennsylvania State University.
