Note
Studied by 21 peopleDormant CC Reading Notes/Class Notes
The court has repeatedly invalidated state requirements that products be inspected ,processed or treated inside the state before they may be shipped out of state. Such statutes generally single out by their terms in-state businesses and on the basis of geographical location give them preference over potential out-of-state competitors.
Minnesota v. Barber:
The court struck down a MN statute that required any meat sole w/i the state to be examined by an inspector within the state.
Foster Fountain Packing Co v. Haydel: The court truck down a Lousiana statute that forbade the xportation of shrimp unless teh heads and hulls had first been removed within the state.
Toomer v. Witsell: The court struck down a South Carolina statute that required shrimp fishermen to unload, pack, and stamp their catch before shipping it to another state. In each of these cases, the Supreme Court ruled that these state regulations imposed undue burdens on interstate commerce, violating the Commerce Clause of the Constitution.
Cities enacting disriminatory laws holds the same analysis as if the state does it too.
Rule of Law
A state statute that discriminates against interstate commerce will be held invalid if there are other, less-discriminatory means by which the state legislature can accomplish its objective.
Facts
The City of Madison, Wisconsin (defendant) passed an ordinance making it unlawful to sell milk as pasteurized unless it had been processed and bottled at an approved pasteurization plant within five miles of Madison’s central square. Dean Milk (plaintiff) was an Illinois corporation engaged in distributing milk in Wisconsin that had been pasteurized at plants about 65 and 85 miles away from central Madison. Dean Milk brought suit against Madison challenging the statute on the grounds that it violated the Commerce Clause and the Fourteenth Amendment to the United States Constitution. The lower courts upheld the statute, and Dean Milk appealed to the United States Supreme Court. Madison argues that they want to keep the quality of milk high for consumers and ensure public health, but the Supreme Court must determine whether this justification is sufficient to outweigh the burdens imposed on interstate commerce.
Issue
Is a statute unconstitutional if it places an excessive burden on interstate commerce?
Holding and Reasoning (Clark, J.)
Yes. The practical effect of the statute is the exclusion of milk pasteurized in Illinois from the Madison, Wisconsin, market, which burdens interstate commerce and benefits local milk producers. This is plainly discriminatory against interstate commerce and is thus not permitted by the Commerce Clause. Additionally, this discriminatory scheme is unnecessary because less-discriminatory alternatives exist that would allow Madison to achieve the same health and safety goals relating to the quality of milk sold within its borders. For example, Madison could enact stricter inspection methods to screen out bad milk before it is sold to Madison retailers, thus eliminating the need to discriminate against all milk from outside sources. The statute is invalid because the statute burdens interstate commerce and less-discriminatory alternatives exist. The decision of the lower courts is reversed.
Dissent (Black, J.)
The Madison ordinance should be upheld as a valid exercise of state regulatory power. Firstly, the ordinance does not completely exclude Illinois milk from Madison markets because of the pasteurization-location requirement, as nothing in the facts suggest it would be overly burdensome for Dean Milk to gather milk elsewhere and pasteurize it at Madison plants. Secondly, the statute does not discriminate against intrastate and interstate producers, as it prohibits milk from being sold in Madison that is not pasteurized within five miles of the city regardless of whether the milk is produced by intrastate or interstate businesses. Finally, the majority erred in concluding that other reasonable alternatives are available to the Madison legislature in choosing how to regulate milk for health and safety purposes. The majority discounts the significant burden the statute imposes on Madison inspectors in requiring the inspectors to strictly inspect all out-of-state milk, relative to the small burden the statute imposes on interstate commerce merely to prohibit interstate milk from being sold in Madison.
Rule of Law
A town statute that discriminates, either on its face or in practical effect, against interstate commerce for the purpose of favoring local business or investment is per se invalid unless the state can meet the strict-scrutiny standard and show that it has no other means to advance a legitimate local interest.
Facts
In 1989, the Town of Clarkstown, New York (plaintiff) entered into an agreement with the New York State Department of Environmental Conservation. The agreement stated that Clarkstown would close its current landfill and hire a private contractor to build a new waste-processing facility. To help pay for the cost of the new facility, Clarkstown enacted a flow-control ordinance that required all solid waste to be processed at the new facility before leaving the municipality for a fee of $81 per ton of waste processed. The fee was paid to the contractor to offset the cost of building the facility. C & A Carbone (Carbone) (defendant) operated a competing waste-processing plant in Clarkstown. Although the flow-control ordinance allowed Carbone to continue operating, it required Carbone to ship all nonrecyclable waste to the Clarkstown facility and pay the $81 fee. In 1991, a tractor-trailer owned by Carbone crashed, and police discovered it was illegally transporting solid waste to an Indiana landfill to avoid paying the fee at the Clarkstown plant. The town sought an injunction requiring Carbone to ship its waste to the town facility. In state court Carbone then challenged the flow-control ordinance on the grounds that it violated the Commerce Clause. The court ruled in favor of Carbone and placed an injunction on enforcement of the ordinance. The New York Court of Appeals reversed and ruled in favor of Clarkstown. The United States Supreme Court granted certiorari.
Issue
Whether Clarkstown’s flow control ordinance requiring that all solid waste be processed in a particular facility violates the Dormant Commere Clause?
Holding and Reasoning (Kennedy, J.)
NoThe ordinance deprives out-of-state- businesses of access to a local market. It “is no less descriminaotry because in-state or in-town producers are also ocvered by teh prohibition. The purpose for striking down laws such as Clarkstown’s flow-control ordinance under the Commerce Clause is to prevent states from engaging in economic protectionism that would impair interstate commerce. Clarkstown argued that it did not discriminate against out-of-state waste producers because Clarkstown treated all trash equally by requiring all trash, regardless of origin, to be processed at the same plant. However, the interstate commerce at issue is not the waste itself, but is rather the profit that could be made from processing the waste. By requiring all waste to be processed by the same in-state processor, Clarkstown was favoring its own processor and engaging in prohibited economic protectionism. Clarkstown has many other less-discriminatory alternatives available to it in dealing with its waste problems. The Clarkstown statute discriminates in its practical effect against interstate commerce, and because the state does not show there are no less-discriminatory alternatives, the statute is unconstitutional. The decision of the New York Court of Appeals is reversed.
Concurrence (O’Connor, J.)
The Clarkstown ordinance is not unconstitutional because it discriminates against out-of-state commerce. It is unconstitutional because it imposes an excessive burden on interstate commerce. The Clarkstown law is not facially discriminatory, so it should be analyzed under the standard articulated in Pike v. Bruce Church, Inc., 397 U.S 137 (1970). In that case, the Court held that a facially nondiscriminatory regulation supported by a legitimate state interest that incidentally burdens interstate commerce is constitutional unless the burden on interstate trade is clearly excessive in relation to the local benefits. Applying this test, the Clarkstown ordinance is unconstitutional because it imposes an excessive burden on interstate commerce without exploring other available, less-discriminatory options.
Dissent (Souter, J.)
The majority improperly compares the current case to precedent cases in which the legislation that was struck down discriminated against out-of-state businesses while promoting private in-state businesses. The present case is distinguishable because it involves building a private facility for government use to raise revenue that would help the government better do its job of disposing of waste. No private businesses are benefited at the expense of out-of-state businesses. The regulation should be upheld as valid because this law does not directly impact out-of-state trash processors, but instead merely requires Clarkstown citizens to pay for the processing of their own waste to solve their own environmental problems. This ordinance is not economic protectionism. The facility is essentially a municipal facility serving a traditionally local government function- Waste disposal. The local government itself occupies a very different market position being the one entitiy that enters the market to serve the public interests.
Rule of Law
A flow-control ordinance that favors the government but treats in-state and out-of-state private businesses the same does not constitute an excessive burden on interstate commerce in violation of the Commerce Clause.
Facts
In the late 1980s, Oneida County and Herkimer County in New York faced a solid-waste crisis due to mismanagement of their landfills and other waste-disposal sites. Several existing landfills were shut down, and the two counties formed the Oneida-Herkimer Solid Waste Management Authority (OHSWMA) (defendant), a public-benefit corporation, to collect, process, and dispose of solid waste in the counties. In 1989, the counties and the OHSWMA entered into an agreement under which the OHSWMA would exclusively manage all processing of waste generated in the counties. The OHSWMA collected tipping fees from each load of waste processed to help fund its operations. To avoid the tipping fees, certain citizens attempted to send their waste to out-of-state waste processors. In response to this, the OHSWMA passed “flow control” ordinances, which required all waste produced within the counties be delivered to OHSWMA’s processing sites. In 1995, United Haulers Association, Inc. (United Haulers) (plaintiff), a trade association made up of solid-waste-management companies operating in the two counties, sued the OHSWMA on the grounds that the flow ordinances violated the Commerce Clause because they discriminated against interstate commerce. United Haulers introduced evidence that without the laws, they could dispose of waste in out-of-state sites for significantly cheaper costs than waste disposed of in the OHSWMA’s sites. The district court ruled in favor of United Haulers, but the court of appeals reversed. The United States Supreme Court granted certiorari.
Issue
Does a flow-control ordinance that requires all waste to be delivered to a government processor constitute an excessive burden on interstate commerce?
Holding and Reasoning (Roberts, C.J.)
No. The flow-control laws do not facially discriminate against interstate commerce, and therefore the laws are not per se invalid. Carbone v. Clarkstown, 511 U.S. 383 (1994), held that laws passed to channel all waste to a private processing plant were invalid. The present case is distinguishable from Carbone because the waste is channeled to a public-benefit corporation, not a private plant. This difference is significant because the government is benefiting from any burden placed on interstate commerce. Laws favoring local government cannot be based on economic protectionism in the same way as laws favoring local businesses. Local governments have the right to make decisions and enact laws to better provide for the health, safety, and general welfare of their citizens, whereas private businesses are generally solely concerned with economic profits. Additionally, because waste disposal is both typically and traditionally a government function, interference with these local government actions based on the Commerce Clause should be avoided. Under the standard articulated in Pike v. Bruce Church, Inc., 397 U.S. 137 (1970), a nondiscriminatory statute should be upheld “unless the burden imposed on interstate commerce is clearly excessive in relation to the putative local benefits.” The benefit of increasing the local government’s ability to provide for the waste-disposal needs of its citizens outweighs the burdens placed on out-of-state waste-disposal plants. The “flow through” laws are a constitutional exercise of the OHSWMA’s regulatory powers. The decision of the court of appeals is affirmed.
Concurrence (Scalia, J.)
The Commerce Clause powers of Congress should not be expanded to give the judiciary power to strike down local laws. Only Congress should be responsible for determining whether a law improperly burdens interstate commerce.
Concurrence (Thomas, J.)
Despite previous support of the notion of a Dormant Commerce Clause in Carbone, courts should no longer use the Dormant Commerce Clause to strike down local laws on the grounds that they burden interstate commerce.
Dissent (Alito, J.)
This case is not meaningfully distinguishable from Carbone, where similar “flow through” laws were invalidated. The distinction between waste-disposal plants operated by private entities and plants operated by public-benefit corporations is unsupported by precedent in terms of necessitating different treatment under the Commerce Clause. Additionally, the distinction between the two facilities is even less significant because the facility in Carbone was essentially owned and operated for the benefit of the municipality. The function of the two plants (to assist the respective governments in providing for their citizens’ waste-disposal needs) is a more useful comparison than the actual ownership of the plants in terms of deciding whether to treat the plants differently under the law. A plant’s public ownership does not make it less likely to further economic protectionism. The only inquiry relevant for deciding these cases is whether the “flow through” laws discriminated against interstate commerce. The OHSWMA ordinance improperly discriminated against interstate commerce and should be invalidated. While acting as market participants by operating a fee-for-service business enterprise in an area in which there is an establisehd interstate market, respondents are also regualing that market in a discrriminatory manner.
Kentucky Dept. of Revenue v. Davis (2008): EXCEPTIONS
Facts: Kentucky taxed bond interests from other states and exempted its own bond interest.
Holding: Constitutional
Reasoning: “Issuance of debt securities to pay for public projects is a quintessentially public function.
Dissent: In United Haulers, Non discrimination not just state involvement was central to the rationa. That justification cannot be invoked here, for discrimination against out-of-state bonds is the whole purpose of the law in question.
The Market Participant Exception: This is a legal principle that allows a state or city to discriminate in favor of its own residents when it functions not as a regulator of the market but rather as a market participant. Allows the state is acting a participant in the market then the ycan act as any other participant will do adn they can discriminate in favor of its own residents without violating the Dormant Commerce Clause.
Exception to the Dormant Commerce Clause when a state or local government acts as a buyer or seller of goods or services or provides an economic exception.
Rule of Law
A state may impose burdens on commercial transactions within the market in which it is a participant but may not go further and impose conditions that have a substantial regulatory effect outside of that particular market.
Facts
In September 1980, the commissioner of the Department of Natural Resources of Alaska (defendant) announced that the department would sell approximately 49 million board-feet of timber in Icy Cape, Alaska, in October 1980. However, the contract for sale required that all timber sold must be processed within the State of Alaska before being shipped outside the state. South-Central Timber Development, Inc. (plaintiff) was an Alaska-based timber retailer that did not operate an Alaska mill and sold primarily unprocessed timber to exclusively out-of-state clients. South-Central Timber Development brought suit in district court seeking to enjoin enforcement of the in-state-processing requirement on the grounds that it violated the dormant Commerce Clause. The district court agreed and granted the injunction, but the court of appeals reversed. The United States Supreme Court granted certiorari.
Issue
May a state that is a market participant act in a way that imposes burdens on the industry within and outside that particular market?
Holding and Reasoning (White, J.)
No. Alaska’s conditions on the sale of its timber are improper because the state is indirectly regulating conditions relating to the timber-processing market as a result of its ownership of the raw-timber market. Alaska is a market participant in the timber market and thus can impose whatever conditions it wishes on commercial transactions relating to the sale of timber, but it is acting as more than merely a seller of timber in attempting to regulate timber processing. If Alaska had merely provided a subsidy to timber sellers that processed their products in the state, it would have been acting within its constitutional rights as a market participant. However, because the Alaska regulations leave buyers no choice of where to process their timber, Alaska’s actions exceed the narrow scope of the market-participant exception to the Dormant Commerce Clause.
Concurrence (Brennan, J.)
Alaska is attempting to regulate market activity in a way that is not authorized by Congress. However, Justice White’s opinion and Justice Rehnquist’s dissent illustrate the inherent weaknesses in the market-participant exception to the Dormant Commerce Clause.
Concurrence (Powell, J.)
This case should be remanded to the court of appeals to determine whether Alaska is acting as a market participant, and whether Alaska’s condition impermissibly burdens interstate commerce according to the test established in Pike v. Bruce Church , 397 U.S. 137 (1970).
Dissent (Rehnquist, J.)
The line drawn between the state as a market participant and the state as a market regulator is artificial and not supported by a coherent distinction. Alaska is merely paying the buyer of timber directly, by means of a reduced price, to hire Alaska residents to process its timber. This is a legitimate state purpose that could have been constitutionally accomplished in many other ways.
Important: It allows a state to impose burdens on commerce within the market in which it is a particiapnt, BUT allows it to go no further. The state may not impose conditions whether by statute regulation or contract that havea substantial regvulatory effect outside of the particular market.
IN CLASS NOTES Dormant Commerce Clause Part II:
Commerce Clause: Enables the U.S. Congress to regulate commerce, a power given to congress. This is where we are getting the dormant commerce clause.
The dormant commerce clause refers to the prohibition of states from enacting legislation that discriminates against or excessively burdens interstate commerce.
United States v. Lopez: The court identified 3 (4) categories in which Congress can regulate under vthe Commerce Clause:
The use of teh channels of interstate commerce.
The instrumentalities of interstate commerce.
The persons or things in interstate commerce, even though the threat may come only from intrastate activities.
Activities that substantially relation interstate commerce, even if it is not interstate commerce itself (“subsantially affects”)
Dormant Commerce Clause: When Congress is silent and has not spoken on an area, yet the Supreme Court holds that states are still prohibited from regulating interstate commerce.
Three Modern Categories of the Dormant Commerce Clause:
Facial Discrimination: Laws that explicitly discriminate against out-of-state competitors, treating them less favorably than in-state interests. Makes a distinction between our business.
Ex. Providing a 10% tax credit to the Rough Riders business that operates solely within the state while imposing a 15% tax on businesses that sell similar products imported from out of state. This is a law that facially discriminates against out of state commerce.
Facially Neutral: If a state has a facially neutral law; it doesn’t say that you are protecting a particular business or discriminating against an out-of-state business, but still has a protectionist purpose for in-state industries. They have an impermissibly protectionist purpose or effect (Usually unconstitutional).
State law that are facially neutral but have a disproportionate adverse effect on interstate commerce. There is no protectionist purpose on protecting the interests of commerce in this category. (Sometimes unconstitutional sometimes they’re not).
If they are not trying to protect the economy but something else but would still have an adverse effect on interstate commerce interests.
Evolution of Facial discrimination Cases:
Granholm v. Heald: Discriminatory regulatory burden (Unconstitutional).
Maine v. Taylor: Banning importation due to ecological effects, like quarantines (Constitutional).
Chemical Waste Management, Inc. v. Hunt
Discriminatory Fee (Unconstitutional)
Oregon Waste Systems v. DEQ:
Discriminatory Tax unconstitutional but there is an EXCEPTION:
That if there is a general taxation of all waste producers. As long as it is not discriminatory.
If there is a discriminatory compensatory tax on out of state producers but it is allowed as it makes up for other taxes that are put on the local businesses.
Discriminatory tax (unconstitutional) unless compensatory.
West Lynn Creamery v. Healy: Subsidies from general revenues are constitutional but rebates of taxes are not.
Camps Newfoun/ Owatonna v. Town of Harrison: Discriminatory Tax Exemption (Unconstitutional).
New Energy Co. of Indiana v. Limbach: Discriminatory Tax Credit (Unconstitutional).
Facial Discrimination:
Home Processing Requirements:
A Home Processing Requirement is Requiring the processessing of something within your own state. That if a state is going to process a specific type of product a home processing requirement is stating that it must be processed in state before being shipped out of state. This has an unfair advantage on in-state businesses over out of state ones.
Market Participant Exception:
Hughes v. Alexandria Scrap: Scrap
Reeves Inc. v. Stake: Cement
White v. Mass. Council of Construction Employers (1983).
Caveat: As long as this does not violate any other provision of the United States Constitution. Government can act as a market participant as long as it is not violating any other provision of the United States Constitution.
Justifications for Subsidies and Market Participatn Exceptions:
Text of the Commerce Clause
Economic Effect
Parity with Private Actors
Federalism Concerns
Investment Capture
Facially Neutral Laws with protectionist purpose or effect.
Facial discrimination against interstate commerce is relatively rare.
“Tariffs against the products of other states are so patently unconstitutional that our cases reveal not a single attempt by any state to enact one.
Rule of Law
Under the Commerce Clause, a state may not pass restrictions that overly burden interstate commerce for the purpose of reducing competition between the states.
Facts
New York passed the Milk Control Act, which prohibited the sale of milk imported from another state by third parties unless the price paid to the producer in the other state reached at least the minimum amount required to be paid to local New York milk producers. G.A.F. Seelig, Inc. (plaintiff), a Vermont milk producer, brought suit in federal district court against Baldwin (defendant), a New York State official, challenging the Milk Control Act as an unconstitutional burden on interstate commerce. The district court granted partial relief for G.A.F. Seelig, Inc., regarding its milk imported in original cans and bottled in New York, but the court denied relief for milk imported from Vermont in bottles. Both parties appealed to the United States Supreme Court.
Issue
Whether a New York state law that prohibits the sale of milk imported from Vermont unless it meets certain pricing criteria constitutes an unconstitutional burden on interstate commerce.
Holding and Reasoning (Cardozo, J.)
Yes. Under the Commerce Clause, a state may not pass restrictions that overly burden interstate commerce for the purpose of reducing competition between the states. States may not use their police power to establish economic barriers to competition with the products of other states. Here, the practical effect of the New York statute is to set a barrier to the traffic of milk from other states into New York. The New York legislation seeks to promote the economic welfare of New York milk farmers by protecting them from competition from Vermont milk farmers charging cheaper prices. This is an impermissible burden on interstate commerce. New York’s argument that the purpose of the legislation is to maintain a regular milk supply by ensuring farmers are paid a living wage is rejected. To allow the state to legislate to this end would be to allow it to intervene in times of economic scarcity for the purpose of keeping its own farmers afloat at the expense of farmers from other states. The Framers of the Constitution did not intend for states to operate in such economic isolation, but rather believed that states should weather economic difficulties together. The decision of the district court is affirmed in part and reversed in part.
Balancing Facially Neutral Laws with a disproportionate adverse effect on commerce:
Rule of Law
Under the principle of the Dormant Commerce Clause, a state law that heavily burdens interstate commerce while only marginally furthering a state health and safety purpose is unconstitutional.
Facts
Consolidated Freightways Corp. (Consolidated) (plaintiff) was a trucking company with routes that included shipping goods through Iowa. Consolidated used both semi (one trailer) and twin (two trailers) trucks in its operations. Consolidated preferred to use 65-foot-long twin trucks because they could transport more goods at once. An Iowa state law, however, prohibited the use of most trucks longer than 55 feet within the state’s borders. Consolidated could either use other trailer options, detach its trailers at the Iowa border, or divert its trucks around the state. Consolidated was not satisfied with these options and filed suit against Kassel (defendant), the state official responsible for enforcement of the Iowa statute, in federal district court on the ground that the Iowa state law unconstitutionally burdened interstate commerce. Iowa defended its law on the ground that it was necessary for highway safety. The district court concluded that there was no difference in safety between a semi and a twin truck and held the Iowa law unconstitutional. The court of appeals affirmed, and the United States Supreme Court granted certiorari.
Issue
Is a state law that burdens interstate commerce while only marginally furthering a health and safety purpose unconstitutional under the Dormant Commerce Clause?
Holding and Reasoning (Powell, J.)
Yes. The Iowa state law limiting truck size only marginally furthers a state safety purpose while overly burdening interstate commerce, and it is thus unconstitutional. Under the principle of the Dormant Commerce Clause, to be constitutional, a state law must further a health and safety purpose if it heavily burdens interstate commerce. Although state judgments about health and safety issues are normally entitled to great deference by the courts, if a state’s safety interest is found to be illusory and its regulations are found to significantly impair the federal interest in efficient and safe interstate transportation, the state law violates Commerce Clause principles. In this case, the district court considered significant evidence on the safety of twin trucks versus semi trucks and found no significant difference in the safety of the two trucks. In contrast, Consolidated provided significant evidence of the burden the law places on interstate commerce. Under the law, trucking companies must spend significant time and money to change their trailer options at the Iowa border or divert their trucks completely around the state. Consolidated showed that all this extra driving actually increases the occurrence of accidents among trucks on the highways outside of Iowa and thus worsens safety conditions in other states. After considering all the evidence, the district court believed that Iowa was actually motivated by a desire to reduce the overall traffic on its roads, rather than a judgment that twin trucks are actually less safe than semis. A state may not promote its own interests in reducing highway congestion by requiring safe vehicles to detour around it at a significant cost to the vehicle owners. The district court’s findings that the Iowa statute only marginally furthers a state safety interest, while at the same time significantly burdening interstate commerce, are controlling. The appellate court's judgment is affirmed.
Concurrence (Brennan, J.)
The plurality and the dissent both incorrectly assume that the constitutionality of the Iowa state law turns on the development of the factual record at the trial court. The Court should actually consider the intent of Iowa’s lawmakers in passing the law to determine whether its burden on interstate commerce was justified by a valid state purpose. The legislative history suggests that the actual purpose of the lawmakers in passing this regulation was to discourage interstate truck traffic on Iowa’s highways. This purpose is protectionist in nature and is thus impermissible under the Commerce Clause.
Dissent (Rehnquist, J.)
States are entitled to significant deference when making laws that impact the health and safety of their citizens. Accordingly, a state health and safety purpose behind a law must be extremely minimal to warrant striking down the entire law as an unconstitutional violation of the Dormant Commerce Clause. It is not up to the courts to balance the competing factors and determine whether the safety risks posed by twin trucks were great enough to justify a law banning their use on Iowa’s highways. The Iowa legislature already rationally concluded this was the case, and this decision is entitled to deference from the courts. The plurality and concurrence improperly characterized the state’s purpose as “protectionist” and thus in violation of the Dormant Commerce Clause. If an activity poses a certain risk to state citizens by increasing the dangers of highway travel, a state legislature may constitutionally prohibit the activity without being labeled as “protectionist.”
The Dormant Commerce Clause will most likely be on the final.
Dormant Commerce Clause Part III:
Dormant Commerce Clause: Congress is silent; it has not passed legislation on a particular issue concerning interstate commerce.
Yet the Supreme court holds that the states are still prohibited from regulating interstate commerce.
Three Modern Categories of the Dormant Commerce Clause: For the exam please understand the current law. The history is not as relevant. Don’t need the history. What is the current status on the law.
State Laws that facially discriminate against out-of-state commerce (usually unconstitutional). Vertually Per-se Unconstitutional.
State Laws that are facially neutral between (in-state and out-of-state commerce but have an impermissibly protectionist purpose or effect (usually unconstitutional).
State laws that are facially neutral but have a disproportionate adverse effect on IC. Not trying to protect the business, but are trying to protect the health or welfare. Protecting the States economic interest. The question is whether or not the state is competing on an even playing field.
Baldwin v. Seeling:
The state wanted to make sure there were adequate prices of milk within the state so they set a minimum pricing that distributors have to purchase the milk at in order to purchase it within the state of New York. Ensuring that the farmers were making a certain amount per gallon.
Legal Issue: Whether teh NY Milk Control Act violates the DCC.
Unconstitutional.
H.P. Hood v. Du Mond:
Legal Issue: Whether a NY law restricting the issuance of licenses to establish new milk receiving depots that would increase competition for milk from, the state violated the Dormant Commerce Clause.
Holding: Yes, Unconstitutional
States are arguing that this is a neutral law. and that they want to prohibit destructive competition in a market that is already served. Competition that would draw more milk outside of the state.
Hunt. v. Washington State Apple Advertising Comm’n: NC ban on WA grades on apples (marketing): Unconstitutional.
Bacchus imports v. Dias:
Hawaii had a hefty tax on alcohol, but exempted the Hawaii Pineapple wine and brandy.
Unconstitutional.
Exxon v. Governor of MD:
MD Ban on non-independent retail gas stations: Constitutional.
= treatment of out of state and in state independent retailers.
No producers in MD so no state protectionism regarding producers.
Counters anti-competitive vertically integrated monopolies.
No obstruction of gas into the state.
Minnesota v. Clover Leaf Creamery Co.:
MN Ban on non-returnable plastic milk containers: Constitutional.
State law that are facially neutral with a disproportionate adverse effect on Commerce:
The law does not protect local businesses, but still has an adverse effect.
Pike v. Bruce Church:
A home processing requirement on all growers of cantelopes that was packing their cantelopes to California. When Packed in California they were not labled as such.
Pike Balancing Test: A law will be upheld as constitutional if it is:
Evenhanded (Nondiscriminatory)
Advances a legitimate local public interest
Only incidentally affects interstate commerce and
There are no less burdensome alternatives that could promote the local interests as well as this law.
Kassel v. Consolidated Freightways Corp.:
Legal Issue: Constitutionality of an Iowa Statute prohibiting large trucks.
Holding: Unconstitutional
Balancing Test: Was the law evenhanded/ nondiscriminatory?
Is there persuasive evidence that law would improve safety or another legitimate state concern?
Legal Principles: A state’s power to regulate commerce is never greater than in mat