Cite as: 505 U. S. 214 (1992)
Kennedy, J., dissenting
curs sufficient to bring the transaction within its taxing power, the vendor is not taxable." Id., at 537.
Firm expectations within the business community were built upon the rule as restated in Norton. Companies engaging in interstate commerce conformed their activities to the limits our cases seemed to have endorsed. To be sure, the decision to stay at home might have derived in some respects from independent business concerns. The expense and commitment of an in-state sales office, for example, might have informed a decision to send salesmen into a State without further staff support. Some interstate operations, though, carried the unmistakable mark of a legal, rather than business, justification. The technical requirement that orders be approved at the home office, unless approval required judgment or expertise (for example, if the order depended on an ancillary decision to give credit or to name an official retailer), was no doubt the product of the legal rule.
These settled expectations were upset in 1959, their continuing vitality put in doubt by Northwestern States, International Shoe, and Brown-Forman. In Northwestern States, the Court upheld state income taxation against two companies whose in-state operations included a sales staff and sales office. 358 U. S., at 454-455. Our disposition was consistent with prior law, since both companies maintained offices within the taxing State. Ibid. But the Court's opinion was broader than the holding itself and marked a departure from prior law.
"We conclude that net income from the interstate operations of a foreign corporation may be subjected to state taxation provided the levy is not discriminatory and is properly apportioned to local activities within the taxing State forming sufficient nexus to support the same." Id., at 452.
In the absence of case law giving meaning to "sufficient nexus," the Court's use of this indeterminate phrase cre-
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