Overstock.com files lawsuit over New York state tax law

Overstock.com Inc., a Salt Lake City-based online seller of excess inventory, has sued New York state over a new law requiring more Web retailers to collect sales tax on shipments to residents in the state.

The lawsuit, filed Friday in state Supreme Court in Manhattan, challenges the constitutionality of a statute requiring Web companies with no physical presence in New York to collect taxes, Overstock said in a news release.

Amazon.com Inc., the world's largest Internet retailer, filed in a similar lawsuit this month. The law, enacted April 9, requires retailers to pay taxes if they solicit business in New York through a link to a Web site.

"We love New York," said Patrick Byrne, Overstock.com's chairman and chief executive officer, in a statement. "But, we had to choose our New York customers over the New York tax collector armed with an unconstitutional statute."

Overstock.com seeks a court order declaring the statute unconstitutional.