Dormant Commerce Clause - Case Take Aways Flashcards
H. P. Hood & Sons, Inc. v. Du Mond, Commissioner of Agriculture & Markets of New York
H. P. Hood & Sons, Inc. v. Du Mond, Commissioner of Agriculture & Markets of New York
Du Mond denied the license for a new milk facility through a restriction imposed under state law.
- Restriction was invalid in light of the Commerce Clause because its statutory purpose and practical effect would be to curtail the volume of interstate commerce for the benefit of local economic interests.
- A local embargo is invalid under the Dormant Commerce Clause
Aaron B. Cooley v. Board of Wardens of the Port of Philadelphia
Aaron B. Cooley v. Board of Wardens of the Port of Philadelphia
Supreme Court established the “Selective Exclusiveness Test” for judicial review of state regulation of commerce declaring states had the power to regulate the areas of commerce which did not require uniform national regulation by Congress and that were local nature without placing an undue burden on interstate commerce.
South Carolina State Highway Department v. Barnwell Brothers, Inc.
South Carolina State Highway Department v. Barnwell Brothers, Inc.
Facially Neutral and No Discriminatory Impact
- Regulates interstate and intrastate commerce equally
Court accepted the safety benefits of smaller and narrower trucks
- The wider the truck, the more likely an accident and the heavier the truck, the more maintenance dangerous potholes
- Deference to the State: The Court will not “sit as legislators” and choose what is best, especially since state highways are a peculiarly local concern
Southern Pacific Co. v. Arizona
Southern Pacific Co. v. Arizona - Arizona Train Limit Law of 1912
Facially Neutral, But Discriminatory Impact
- Undue burden on interstate commerce without a benefit in safety (Balancing Test)
- All trains would need to be adjusted just to go through Arizona, and the train systems were mostly built by private owners (Distinguishing Barnwell)
- Law obstructs national policy of Congress to promote adequate economic and efficient rail transit
City of Philadelphia v. New Jersey
City of Philadelphia v. New Jersey - Prohibition of out-of-state solid or liquid waste importation
Facially Discriminatory & Discriminatory Impact: Per Se Invalid Economic Protectionism
- The New Jersey law falls squarely in the category of laws that sought to achieve a legitimate goal by the illegitimate means of isolating the State from the national economy
- New Jersey has a legitimate reason to reduce disposal costs for residents and permissibly may impose incidental burdens, but cannot accomplish their goals through “protectionist” means
- Goes against free market principles (Private land-fill owners challenged in this case)
Hunt, Governor of the State of North Carolina v. Washington State Apple Advertising Commission
Hunt, Governor of the State of North Carolina v. Washington State Apple Advertising Commission
North Carolina attempts to level the playing field for their apple growers excluding the Washington State superior grading system requiring all closed apple containers to bear “no grade other than an applicable U.S. grade”
Facially Neutral, But Discriminatory Effect: The statute raises the cost of selling apples in North Carolina, except for North Carolina apple growers. (A law is likely to be found discriminatory if it imposes costs on out-of-staters that in-staters will not have to bear)
- Fails Strict Scrutiny: Clearly excessive with available alternatives
Exxon Corp. v. Governor of Maryland
Exxon Corp. v. Governor of Maryland - Producers or refiners cannot operate retail service stations
Facially Neutral and No Discriminatory Impact
- Passes Muster: Law just excludes one sub-set of out-of-staters from a particular market, not all out-of-staters
- There are no producers or refiners in Maryland to receive preferential treatment. (Maryland’s entire gasoline supply is shipped in from out-of-state suppliers)
- Statute does not burden interstate commerce – The law would at most cause a shift in suppliers
- **Statutes permissibly can cause incidental burdens and favor certain classes over, just not based on residency **
West Lynn Creamery, Inc. v. Healy
West Lynn Creamery, Inc. v. Healy - Proceeds of non-discriminatory milk tax subsidize in-state milk
Facially Neutral, But Discriminatory Purpose & Impact
- The purpose and the effect of the program was to enable higher cost Massachusetts dairy farmers to compete with lower costs farmers from other states.
- Tax and subsidies are, independently, constitutional aspects of state power but he combination of the two here assists local farmers at the expense of interstate competitors, Violation of the Dormant Commerce Clause
- Furthermore, impairs the political process by mollifying in-state interests, i.e., the Massachusetts milk producers, who would otherwise lobby against the tax
Minnesota v. Clover Leaf Creamery Co.
Minnesota v. Clover Leaf Creamery Co. - Prohibition of all plastic, non-returnable milk containers
Facially Neutral and No Discriminatory Impact
The statue placed a relatively minor burden on interstate commerce.
- Milk products could freely cross the Minnesota border and because most dairies have multiple ways to package their products, it was not inconvenient to conform to different packaging requirements in different states.
- Even if pulpwood industries in the state are slightly benefited, out of state pulpwood producers will presumably absorb some of the business generated by the statute.
- If interstate commerce was found to be heavily burdened, the burden was not “clearly excessive” in light of the substantial state interest in promoting conservation of energy and there is no approach with a lesser impact on interstate activities available.
Dean Milk Co. v. City of Madison, Wisconsin
Dean Milk Co. v. City of Madison, Wisconsin - Milk must be pasteurized & bottled in approved plant
Facially Neutral, But Discriminatory in Effect and Purpose
- A state may not economically isolate itself
- The Court found that the ordinance was protectionist in nature imposing a undue burden on interstate commerce
- Failed Strict Scrutiny: Less restrictive means existed, Case demonstrates the high bar to pass muster for discriminatory laws
Maine v. Taylor and United States
Maine v. Taylor and United States - Prohibited the importation of live baitfish
Facially Discriminatory Law Passes Muster Under Strict Scrutiny:
The environment is a legitimate concern for Maine because importing minnows could ruin Maine’s fragile fisheries.
No feasible alternatives existed –The burdens are incidental to accomplishing the state interest
Loren J. Pike v. Bruce Church, Inc.
Loren J. Pike v. Bruce Church, Inc. - Arizona Fruit & Vegetable Standardization Act
Facially Neutral Law, But Discriminatory Purpose & Impact
- The purpose of the law in question here was to protect and enhance the reputation of growers within the State, a legitimate State interest.
- However, the State’s interest is not worth the Arizona cantaloupe company building and operating a new $200,000 packing plant
- Fails Rational Basis Review: Burden on interstate commerce exceeds the interest being served
Hughes v. Alexandria Scrap Corp
Hughes v. Alexandria Scrap Corp. - More ownership proof required from out-of-state scrap dealers
Origin of the Market Participant Exception:
Maryland entered the market themselves as a provider of these payments, as a purchaser of a commodity that it values, the scrapping of cars
- They permissibly may set the way it does business with its own citizens to be easier than with other out-of-state citizens
Western & So. Life Insurance Co. v. State Board of Equalization of California
Western & So. Life Insurance Co. v. State Board of Equalization of California - Retaliatory Tax
The McCarran-Ferguson Act removed all Commerce Clause limitations on the authority of the states to regulate and tax insurance companies and unequivocally permitted this kind of tax
- Tax fits squarely within the Congressional authorization
Reeves, Inc. v. William Stake
Reeves, Inc. v. William Stake - South Dakota cement plant favors in-staters during cement shortage
States that are “market participants” in the buying and selling of goods, as opposed to “market regulator” are not bound by the Constitution’s Commerce Clause and can favor their in-state businesses.
Sough What You Reap Rationale: Allow in-state citizens to have preferential access for the taxes they pay, and this preference is constitutional
