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City of Golden v. Sodexo Am., LLC

Supreme Court of Colorado

May 20, 2019, Decided

Supreme Court Case No. 17SC735


 [**445]  en banc

JUSTICE HOOD delivered the Opinion of the Court.

 [*P1]  Imagine that two students enter a dining hall at the Colorado School of Mines in the City of Golden. One pays with cash; the other swipes a "BlasterCard" to use a meal-plan credit. Sodexo, Mines' food service provider, collects sales tax on the cash transactions and remits the tax to Golden. Not so when a student swipes a BlasterCard to use a meal-plan credit. That disparity in tax treatment culminated in this case.

 [*P2]  A little background information about BlasterCards helps to flesh out the legal dispute. During the time at issue, Mines loaded each meal-plan student's BlasterCard, which is a student's identification card, with an individual meal plan choice. To use their meal plans, students [***3]  swiped their BlasterCards at a dining facility. Sodexo had nothing to do with loading the students' BlasterCards with their meal plans—that was all Mines. Sodexo also had no way of knowing if a student had fully paid for his or her meal plan, and Sodexo had no way of enforcing collections against a student who hadn't fully paid. Again, that was all taken care of by Mines. But neither Mines nor Sodexo collected any sales tax on these meal-plan meals.

 [*P3]  When Golden's Finance Department audited Sodexo and discovered that sales tax for these meal plans had not been collected, it issued a sales and use tax assessment. Sodexo protested and lost, so Sodexo appealed to the district court. The court granted summary judgment for Golden, finding that Sodexo had engaged in taxable retail sales directly to Mines' students, rather than tax-exempt wholesale sales to Mines.

 [*P4]  Undeterred, Sodexo appealed again. This time, a unanimous division of the court of appeals reversed the judgment of the district court, concluding that there were two sales transactions at issue: one between Mines and Sodexo, and the other between Mines and its students. The division further concluded that Mines and Sodexo were engaged [***4]  in tax-exempt wholesale transactions. Accordingly, the division remanded for entry of judgment in Sodexo's favor.

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2019 CO 38 *; 441 P.3d 444 **; 2019 Colo. LEXIS 376 ***; 2019 WL 2167903

Petitioners: City of Golden, Colorado and Jeff Hansen, in his official capacity as Finance Director of the City of Golden, Colorado, v. Respondent: Sodexo America, LLC.

Prior History:  [***1] Certiorari to the Colorado Court of Appeals. Court of Appeals Case No. 16CA1355.

Sodexo Am., LLC v. City of Golden, 442 P.3d 931, 2017 Colo. App. LEXIS 1136, 2017 COA 118 (Sept. 7, 2017)

Disposition: Judgment Affirmed.


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Civil Procedure, Appeals, Summary Judgment Review, Standards of Review, Standards of Review, De Novo Review, Governments, Legislation, Interpretation, Questions of Fact & Law, Local Governments, Ordinances & Regulations, Tax Law, State & Local Taxes, Sales Taxes, Imposition of Tax, Sales Tax Definitions, Exempt Sales