Qui Tam Troubles Continue in Illinois

Sovos | March 19, 2015

A new round of Qui Tam lawsuits regarding tax on shipping charges in Illinois has been filed against numerous wineries and wine retailers. For more information on tax on shipping in Illinois, please see our December blog post, which we’ve updated periodically with additional links and information in the “Resources” section, including a posting from Wine Institute on the matter.

The latest round of lawsuits appears to have been filed in December or earlier, but kept under seal for at least 60 days prior to being served. Per the False Claims Act statute, the “complaint shall be filed in camera, shall remain under seal for at least 60 days, and shall not be served on the defendant until the court so orders. The State may elect to intervene and proceed with the action within 60 days after it receives both the complaint and the material evidence and information.”

Therefore, it’s possible that additional complaints have been filed since December but remain under seal as we speak. Businesses that are engaged in sales to Illinois consumers should check with their tax advisor and/or legal counsel and carefully review their shipping policies and eCommerce checkout processes.