Overstock.com Makes Good on Promise to Reinstate Hawaii-Based Affiliate
Advertisers Following Governor's Wise Veto.
Assessing 'Negative Consequences,' Governor Labels Tax Affiliate Nexus Bill:
'Not Well Thought Out.'
SALT LAKE CITY, July 2 /PRNewswire-FirstCall/ -- Overstock.com, Inc. (Nasdaq:
OSTK), which is located entirely in Utah, today reinstated its Hawaii-based
affiliate advertisers, following Governor Lingle's laudable decision to veto
legislation that would have forced the e-tailer to collect taxes on its Hawaii
sales if it maintained ties with Hawaiian Internet ad affiliates.
Governor Lingle's veto closely followed Governor Arnold Schwarzenegger's
Tuesday night veto of similar legislation in California.
Patrick Byrne, chairman and CEO of Overstock.com, stated, "Today we cheerfully
comply with Governor Lingle's request that we promptly restore our
relationships with her state. We are more than happy to do so and thank the
Governor for seeing clearly on this bill."
In her veto, Governor Lingle cited one of the negative effects of the bill was
its impact on non-profits, like the University of Hawaii, who depend in part
on e-tailing banner ads on its bookstore website.
Only a handful of states have considered similar anti-Internet ad laws which
attempt an end-run of U.S. Supreme Court Decisions preventing states from
enforcing tax collection duties on out-of-state companies that have no
"physical presence" in the state. The laws attempt to designate local,
independent internet advertisers as a "physical presence" sufficient to
justify tax collection obligations.
Overstock.com, and other prominent e-tailers, labeling the laws
"unconstitutional" sued the State of New York when such a law first passed
there in 2008. Only four other states (Hawaii, California, Rhode Island, and
North Carolina) have followed New York; though additional legislatures have
considered and rejected similar bills.
On Tuesday, Overstock.com canceled affiliate advertising contracts in all of
those states, including California and Hawaii, but reversed the action in
Hawaii and California following their governors' wise vetoes. The advertiser
cancelation is still in effect in North Carolina where a bill is under
consideration, and in Rhode Island were a bill became law on Wednesday.
About Overstock.com
Overstock.com, Inc. is an online retailer offering brand-name merchandise at
discount prices. The company offers its customers an opportunity to shop for
bargains conveniently, while offering its suppliers an alternative inventory
distribution channel. Overstock.com, headquartered in Salt Lake City, is a
publicly traded company listed on the NASDAQ Global Market System and can be
found online at http://www.overstock.com. Overstock.com regularly posts
information about the company and other related matters on its website under
the heading "Investor Relations."
Overstock.com(R) is a registered trademark of Overstock.com, Inc.
This press release contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Such forward-looking statements include, but
are not limited to, statements regarding reversal of the termination of
Internet affiliates. Our Form 10-K/A for the year ended December 31, 2008, our
subsequent quarterly reports on Form 10-Q, or any amendments thereto, and our
other subsequent filings with the Securities and Exchange Commission identify
important factors that could cause our actual results to differ materially
from those contained in our projections, estimates or forward-looking
statements.
SOURCE Overstock.com, Inc.
Roger Johnson, +1-801-947-4430, rojohnson@overstock.com, or Investors, Kevin
Moon, +1-801-947-3282, kmoon@overstock.com, both of Overstock.com, Inc.
