In May, 2012, the United States Federal District Court overturned General Ordinance No. 5988 under the grounds of Federal preemption. This ordinance required all businesses conducting work within the city to use E-Verify on all employees and to provide identity and employment authorization documentation of its workers. An employer or business that failed to comply faced civil fines and revocation of its business license or permit.

The controversial E-Verify ordinance was enacted in February, 2012, and a group of Springfield, Missouri business subsequently filed suit seeking to strike down the ordinance. The plaintiffs contended that the E-Verify ordinance placed Springfield’s businesses at a competitive disadvantage by “piling on more city regulations in an area of the law pervasively covered by Federal law.”

On September 20, 2012, the plaintiff businesses and the City of Springfield reached a settlement and filed an offer of judgment and acceptance of judgment that essentially nullified the E-Verify requirements. The city conceded that only the E-Verify portions of the ordinance were enforceable in view of the Supreme Court’s recent ruling on Arizona’s SB 1070 law. In addition, the City of Springfield agreed to pay the sum of $45,350 as attorney fees to the plaintiffs.

The successful lawsuit brought by the Springfield businesses reflect the growing frustration of employers with state and local efforts to place additional layers of regulatory requirements regarding their workforce.