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IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_________________________
No. 93-7692
________________________
IN THE MATTER OF: EAGLE BUS MANUFACTURING,
INC.,

Debtor,
STATE OF OKLAHOMA, ex rel.
OKLAHOMA TAX COMMISSION,
Appellant,
versus
GREYHOUND LINES, INC.,
Appellee.
____________________________________________________
Appeal from United States District Court
for the Southern District of Texas
__________________________________________________
(April 10, 1995)
Before GARWOOD, SMITH and STEWART, Circuit Judges.
CARL E. STEWART, Circuit Judge:
The Oklahoma State Tax Commission appeals the judgment of the
District Court finding that its taxation of interstate bus tickets
violated the Commerce Clause of the United States Constitution.
For the following reasons, the judgment of the District Court is
reversed.
BACKGROUND
Greyhound Lines, Inc. ("Greyhound") is a bus line providing
transportation service for both intrastate and interstate travel.
In 1990, it filed for protection under Chapter 11 of United States

Bankruptcy Code. In 1991, the Oklahoma Tax Commission
("Commission") filed a proof of claim for unpaid sales taxes on the
price of interstate bus tickets sold in Oklahoma. This tax was
assessed against the gross receipts of all tickets sold in Oklahoma
regardless of where the trips began or ended. The Bankruptcy Court
found that the sales tax violated the Commerce Clause of the United
States Constitution. The District Court affirmed the Bankruptcy
Court judgment. The Commission appeals the judgment of the
District Court.
DISCUSSION
The Commission contends that the state sales tax levied on
interstate bus tickets does not violate the Commerce Clause. We
agree. A state tax on interstate commercial activity violates the
Commerce Clause unless it (1) is fairly apportioned, (2) is applied
to an activity with a substantial nexus to the taxing state, (3)
does not discriminate against interstate commerce, and (4) is
fairly related to the services or benefits provided by the state.
Complete Auto Transit v. Brady, 430 U.S. 274, 279, 97 S.Ct. 1076,
1079, 51 L.Ed.2d 326 (1977). If a tax statute fails to meet any of
these four prongs, the statute will violate the Commerce Clause.
See Goldberg v. Sweet, 488 U.S. 252, 259-60, 109 S.Ct. 582, 588,
102 L.Ed.2d 607 (1989).
In a recently decided case, Oklahoma Tax Commission v.
Jefferson Lines, Inc., No. 93-1677, 1995 U.S. Lexis 2418 (U.S. Apr.
3, 1995), the United States Supreme Court was faced with exactly
the same issue--whether the Oklahoma sales tax assessed on
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interstate bus tickets sold in the State of Oklahoma violated the
Commerce Clause. The Supreme Court held that this Oklahoma sales
tax met the requirements of Complete Auto Transit. Id. at 18-45.
In accord with the Supreme Court's decision in Oklahoma Tax
Commission v. Jefferson Lines, Inc., we reverse the judgment of the
District Court.
CONCLUSION
Because the Supreme Court has held that the Oklahoma sales tax
does not violate the Commerce Clause, we REVERSE the judgment of
the District Court. This case is remanded to the Bankruptcy Court
for further proceedings consistent with this opinion.
3