PLSC 471 Quiz 3 Classnotes

Commerce Clause

Art I, Sec. 8, Cl. 3:

Congress shall have the power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes"

Foreign Commerce

"with foreign nations"; Controlled by the federal government

Interstate Commerce

"among the several states"; Commerce that crosses state lines

Intrastate Commerce

Commerce within a state; This is the domain of the state

Constitutional Convention Commerce goals

uniform regulations, reduce interstate hostilities, regulate foreign trade

Federalist Paper No 22

Hamilton & Madison agreed on the necessity of central gov't controlling commerce

Gibbons v Ogden Facts

1. Livingston had a NY state monopoly license in steamboats

2. taken over by Odgen & Gibbons

3. Gibbons left, partnering with Vanderbilt which a license under the Coast Licensing Act of 1793 (federal)

4. Ogden issued for them to be banned from entering NY waters

Gibbons v Ogden Issue

-under the commerce clause, may a state create a monopoly over the navigation of an interstate waterway?

NO 6-0, Marshall

Gibbons v Ogden Court Decision

Marshall clarifies terms & scope of Congressional Power

Commerce is "one of ___ not ___"

Enumeration; definition

Commerce

Commercial intercourse between nations and parts of nations

Commerce includes

Transportation and navigation

Commerce begins

In one state and ends in another

Commerce is a what type of power?

Plenary power

Plenary power

Exclusive authority over a particular area

Concurrent power

power shared by the states and federal government

Supremacy clause

Federal law is supreme over state law

Why is the commerce clause important?

provides jurisdiction for various legislation

Because of the commerce clause, Congress can only enact legislation related to___

Constitutional powers

Why can the Commerce Clause be controversial?

Broader interpretation leads to greater federal gov't power

Congressional Principals

1. Federal gov't have enumerated powers

2. Federalists 45

Enumerated Powers

written in the constitution

Federalist 45

The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the State governments are numerous and indefinite

Interstate Commerce Act of 1887

Establishes a mechanism for regulating interstate railroads

Sherman Anti-Trust Act of 1890 (Sherman Act)

Designed to break up monopolies that restrained trade; covered manufacturing & processing stages

US v EC Knight Co Facts

1. American Sugar Refining Co. monopolized the industry (98%); merge with PA Co.

2. Federal gov't sued to have accqusition agreements cancelled; violated sherman act

US v EC Knight Co issue

Based on the Commerce clause, may the federal gov't regulate the monopolistic practices of companies engaged in manufacturing?

No, 8-1, Fuller

US v EC Knight Co Court Decision

Manufacturing- "Commerce succeeds to manufacture, and is not part of it"

Federal regulation of monopolies requirements

1. Must involve interstate or foreign commerce

2. Transportation and instrumentalities of commerce

Kidd v Pearson (1888)

1. only commerce when in stream of commerce; being bought & sold

2. Manufacturing liquor in Iowa

3. Intent to export was irrelevant

Kidd v Pearson Precedent for which case?

US v EC Knight Co

Production (in the past)

manufacturing, mining, and agriculture

The Court in some ways struggles to apply the _____ to respect ___ rights and adapt to the developing ___

commerce clause; states; economy

Congress may regulate intrastate commerce that___

Has a direct effect on interstate commerce

Congress can regulate intrastate commerce when

intrastate activities substantially burden interstate commerce

When the stream of commerce is interupted

Congress can regulate intrastate commerce

Stream of Commerce

interstate commerce that is part of the movements of a product

early 1900s meatpacking industry

Large firms controlled Midwestern stockyards. Livestock moved from Western ranchers to Eastern consumers through this system. Stockyards served as the central hub of processing and trade.

How did meatpacking companies control the market?

Meatpacking companies set the prices paid to ranchers for livestock. They controlled transportation rates and influenced meat prices. They also had the power to withhold meat from the market.

What legal argument did meatpacking companies make about federal regulation?

The companies argued that stockyard activities were intrastate commerce. They claimed that federal antitrust laws did not apply to these activities. They also argued that interstate commerce paused at the stockyards.

Swift & Co v US

The companies argued that stockyard activities were intrastate commerce. They claimed that federal antitrust laws did not apply to these activities. They also argued that interstate commerce paused at the stockyards.

Stafford v. Wallace

Stafford and Company sued against the Packers and Stockyard Act

Packers and Stockyard Act

forbade meatpackers in interstate commerce to engage in any unfair, discriminatory, or deceptive practices

Stanford v Wallace Issue

Under the Commerce Clause and Swift & co. V US, may Congress regulate dealers and commission agents at livestock markets?

Yes, 7-1, Taft

What was the purpose of the Packers and Stockyards Act according to the Court?

"free and unburdened flow of livestock"

Prevent unreasonable prices through collusion

How did the Court describe the role of stockyards in commerce?

Not the final destination

They are "a throat through which the current flows"

How did the Court treat intrastate transactions in stockyards?

"Cannot be separated from the movement to which they contribute on necessarily take on its character"

This is a part of the larger flow of commerce

Swift

a stream of commerce is the essence of interstate commerce

Police power

The authority to regulate the health, safety, and welfare of citizens

___have police power; ___gov't doesn't*

States; Federal gov't

how can the federal gov't have police power?

can do it through funding & commerce

Champion v Ames Facts

Charles Champion was charged with shipping lottery tickets across state lines from Paraguay, violating the Anti-Lottery Act of 1895

Anti-Lottery Act of 1895

Prohibited lottery tickets from being imported abroad, transported across state lines or sent through the mail

Champion challenged his charge which questioned ___ vs __

Regulation vs supression

Champion v Ames Issue

Under the commerce clause, may Congress prohibit the interstate shipment of goods because those goods are harmful to society?

Yes, 5-4, Harlen

Champion v Ames Court Decision

Lottery tickets are commerce and injury public morals

The Court in Champion v Ames cited which court case to emphasize commerce power is plenary?

Gibbons v Ogden

Plenary power limitation

Due process clause

Plenary power positive effects for Congress

Congress can regulate more federal crimes

Champion v Ames set what precedent?

Congress may use the commerce clause in the same manner as state use their police powers

Hammer v Dagenhart Facts

Executive committee of Southern Cotton Manufactures objected against the Federal Child Labor Act, arguing for states' rights in regulation

Federal Child Labor Act

prohibit the shipment interstate commerce of products made from child labor

Hammer v. Dagenhart Issue

Based on the Commerce clause & 10th amendment, may congress ban interstate shipment of goods made by companies that use child labor?

No, 5-4, Day

Hammer v. Dagenhart Court Opinion

Congress can't compel states to regulate local manufacturing

10th Amendment

any powers that are not specifically given to the federal government, nor withheld from the states, are reserved to those respective states, or to the people at large.

what is the key distinction between Hammer and Knight cases?

the production of goods

In Hammer, the Court saw the law as the regulation of the _____ stage rather than a regulation of the ______

manufacturing; interstate commerce

Congress must show that it isn't ____ manufacturing or _____

regulating; production

IN Hammer c Dagenhart Congress overstepped using ___ to invade state ___

commerce power; police power

During the Great Depression the Legislature was majority ___ but the Judicial was ___

Dems; Reps.

ALA Schechter Poultry Corp v US Facts

The Poultry Corp. (a Brooklyn slaughterhouse) violated the Poultry code. They sued that the code was unconstitutional improper delegation & commerce clause

National Industrial Recovery Act (NIRA)

major act of economic planning for various industries to create codes

Live Poultry Code

has max working hours, min wages, & health inspections

ALA Schechter Poultry Corp v US Issue

Under the Commerce Clause, may Congress regulate the working conditions of large companies that import interstate goods, but only sell intrastate?

no, 9-0, Hughes

ALA Schechter Poultry Corp v US Court Opinion

Stream of commerce didn't apply as the goods didn't come to a permanent rest within the state

The Court classified the slaughter and local sale of chicken as ___, at their___

intrastate commerce; final stop

In ALA Schechter Poultry Corp v US, the effect on interstate commerce is only ___

indirect

Roosevelt was frustrated with the Court because

no vacancies and obstructionism

FDR planned to add __

1 new justice for every 70+ justice (total 6)

NLRB v Jones & Laughlin Steel Co. Facts

Steel corp. fired 10 workers for wanting to join a union

National Labor Relations Act

Protection unions, allow workers to organize, and collective barging

NLRB v Jones & Laughlin Steel Co. Issue

According to the Commerce Clause, may Congress regulate the labor activities that are substantially related to interstate commerce?

Yes, 5-4, Hughes

NLRB v Jones & Laughlin Steel Co. Court Opinion

employees have the right to self-organize

Employees engagement with production doesn't determine is ignoring what principal?

production-commerce distinction

Substantial effect

Intrastate activities that have "a close and substantial relation to interstate commerce"

IN NLRB v Jones & Laughlin Steel Co. Direct/ Indirect Test

was disregarded

NLRB v Jones & Laughlin Steel Co. effect

Changing how we view interstate commerce

Carter v Carter Coal Co

Within the stream of commerce Commerce hasn’t started