Montana v. United States

The federal government sued Montana (defendant, here treated as plaintiff-appellee's opposing party) challenging the constitutionality of Montana's 1 percent gross-receipts tax on public-project contractors, a tax that did not apply to purely private contractors. A nearly identical challenge had already been litigated in state court by federal contractor Kiewit, in which the Montana Supreme Court upheld the tax; the federal government, though not a formal party, had reviewed and approved Kiewit's complaint, paid its attorneys' fees, and submitted briefs in that litigation. After Kiewit's follow-up suit for related refunds was dismissed on res judicata and collateral estoppel grounds, a three-judge federal panel in this separate case concluded Kiewit was not binding on the government and struck down the tax as unconstitutional; Montana appealed.