Hot on the heels of announcing that they would join the lineup of Internet merchants dumping their affiliates in California, Hawaii, North Carolina and Rhode Island – states that plan to tax Internet referals – Overstock reversed its decision to drop its California-based affiliate advertisers following an assurance from Governor Arnold Schwarzenegger’s Office that his rejection of the affiliate nexus tax bill will stand.

Overstock.com’s Chairman and CEO, Patrick Byrne responded “I compliment Governor Schwarzenegger on getting it right” and assured the Governor that it would turn back on the advertising feeds from its California-based affiliate advertisers.

I can only hope that Hawaii, North Carolina and Rhode Island will see the negative impact of their anti-consumer, anti-business legislation and choose not to sign it into law – especially in a down economy!

Have you had your affiliate feed turned off? Please share your story…