Constitutional Law for Business and E-Commerce

U.S. Constitution and Federalism

  • Federalism: U.S. government structure where federal and state governments share powers.
  • Delegated powers: Powers given to the federal government by states.
  • Enumerated powers: Specific powers delegated to the federal government.
  • Reserved powers: Powers not delegated to the federal government are reserved for state governments.

Separation of Powers

  • Doctrine of Separation of Powers: Divides government into three branches.
    • Article I: Legislative branch (Congress - Senate and House of Representatives) makes federal laws.
    • Article II: Executive branch (President and Vice President) enforces federal laws.
    • Article III: Judicial branch (Supreme Court and federal courts) interprets laws.
  • Checks and balances: System to prevent any one branch from becoming too powerful.

Supremacy Clause

  • U.S. Constitution, federal treaties, laws, and regulations are supreme law of the land.
  • State and local laws conflicting with federal law are unconstitutional.
  • Preemption doctrine: Federal law takes precedence over state or local law.
    • Congress can expressly regulate an area exclusively.
    • Concurrent powers may be given to local governments.

Case 4.1: Supremacy Clause

  • Mutual Pharmaceutical Company, Inc. v. Bartlett, 133 S.Ct. 2466 (2013).
  • Issue: Does federal drug labeling law preempt a stricter state drug labeling law?

Commerce Clause

  • Congress has power to regulate commerce with foreign nations, among states, and with Indian tribes.
  • Three types of commerce regulated by the federal government:
    • Commerce with Native American tribes
    • Foreign commerce
    • Interstate commerce

Commerce with Native American Tribes

  • Federal government regulated commerce with Native American tribes during U.S. formative years.
  • Treaties were entered into with many Native American nations.
  • Native Americans are treated as domestic dependent nations with limited sovereignty.

Foreign and Interstate Commerce

  • Foreign Commerce Clause: Federal government regulates foreign commerce.
    • State/local regulations burdening foreign commerce are unconstitutional.
  • Interstate commerce: Commerce moving between states or affecting commerce between states.

Dormant Commerce Clause

  • Federal government has Commerce Clause power but chooses not to regulate an area.
  • States can regulate with their police power.
    • Police power: States/local governments enact laws to protect public health, safety, morals, and welfare.
  • State regulation should not unduly burden interstate commerce.
    • States can enact laws as long as they don't burden interstate commerce.

E-Commerce and the Constitution

  • Electronic commerce (e-commerce): Parties can obtain website domain names and conduct business electronically.
  • E-commerce uses:
    • Sales of goods
    • Licensing of intellectual property
    • Sales of services

Bill of Rights and Amendments

  • Bill of Rights: First ten amendments to the U.S. Constitution.
    • Guarantees fundamental rights to natural persons.
    • Protects from intrusive government action by federal and state governments (Incorporation doctrine).

Freedom of Speech

  • Right to oral, written, and symbolic speech protected by the First Amendment.
    • Fully protected speech: Cannot be regulated or prohibited.
    • Example: Criticizing the President, burning the U.S. flag.
    • Limited protected speech: Subject to time, place, and manner restrictions.
    • Offensive speech: Offensive to many members of society.
    • Commercial speech: Used by businesses, such as advertising.
    • Unprotected speech: Not protected and may be forbidden.
    • Examples: Dangerous speech, child pornography.

Case 4.2: Free Speech Rights and the Internet

  • Packingham v. North Carolina, 2017 U.S. Lexis 3871 (2017).
  • Issue: Does North Carolina statute prohibiting registered sex offenders from using social media violate the First Amendment?

Freedom of Religion

  • Establishment Clause: Prohibits government from establishing a state religion or promoting one religion over another.
  • Free Exercise Clause: Prohibits government from interfering with the free exercise of religion.

Equal Protection

  • Equal protection clause: States cannot deny equal protection of the laws to any person within its jurisdiction.
    • Laws cannot classify and treat similarly situated persons differently.
    • Corporations are also protected.
    • Classification of individuals is not inherently unlawful.

Standards of Review

  • Strict scrutiny test: Applied to classifications based on suspect class (e.g., race) or fundamental rights (e.g., voting).
  • Intermediate scrutiny test: Applied to classifications based on protected classes (e.g., gender).
  • Rational basis test: Applied to classifications not involving suspect or protected class (e.g., age).
    • Court upholds regulation if there's a justifiable reason.
    • Permits government regulation of business.

Case 4.3: Due Process and Equal Protection Clauses

  • Obergefell v. Hodges, 135 S.Ct. 2584 (2015).
  • Issue: Do state laws not permitting same-sex marriage violate the Due Process Clause and Equal Protection Clause of the Fourteenth Amendment?

Due Process

  • Due process clause: No person shall be deprived of life, liberty, or property without due process of the law.
    • Fifth Amendment: Federal government action.
    • Fourteenth Amendment: State and local government action.
    • Government is not prohibited from taking a person’s life, liberty, or property but must follow due process.

Substantive and Procedural Due Process

  • Substantive due process: Laws must be clear and not overly broad.
    • Tested using a reasonable person’s understanding.
    • Laws failing the test are void for vagueness.
  • Procedural due process: Government must give proper notice and hearing before depriving a person of life, liberty, or property.

Government Taking of Property

  • Takings clause: Government can take property for public use with just compensation.
    • Public use.
    • Just compensation.

Case 4.4: Takings Clause and Just Compensation

  • Horne v. Department of Agriculture, 135 S.Ct. 2419.
  • Issue: Does the government’s action constitute a taking of personal property under the Takings Clause requiring just compensation?

Privileges and Immunities

  • Privileges and Immunities Clause: Citizens of each state are entitled to all privileges and immunities of citizens in the several states.
    • No state shall abridge the privileges or immunities of citizens of the United States.
  • Prohibits states from unduly discriminating in favor of their residents.
  • Applies only to citizens, not corporations or aliens.