Residual State Powers—and Their Limits - The Commerce Clause as a Limitation on State Regulatory Power: Modern Applications (Dormant Commerce Clause) Flashcards
Strict Scrutiny
Strict scrutiny review requires that the law or policy being challenged supports a compelling governmental interest, is narrowly tailored to achieve that interest, and is the least restrictive means available to achieve that interest.
C.A. Carbone, Inc. v. City of Clarkstown, N.Y.
Local governments cannot make law that discriminate against out-of-business to favor local business or interests unless it can show under strict scrutiny that there was no other way to accomplish the purpose of the law. (Pike Balancing Test)
C.A. Carbone, Inc. v. City of Clarkstown, N.Y.
Issue:
Whether the local benefit of Clarkstown’s flow control ordinance outweighed its negative effect on interstate commerce.
C.A. Carbone, Inc. v. City of Clarkstown, N.Y.
Facts
Clarkstown made a deal with a contractor to build a solid waste transfer system and let him run it for 5 years as payment. In order to fulfill its guarantee that the transfer system would process 120,000 tons a year at a $81 per tun tipping fee, the city passed a law requiring all nonhazardous and nonrecyclable waste in Clarkstown to go to the transfer station. C & A sued because the law forced it to bring nonrecyclable waste to the new transfer system and pay the tipping fee, which was much higher than a fee in the private sector
C.A. Carbone, Inc. v. City of Clarkstown, N.Y.
Reasoning
Processing and disposing the waste is where the money comes from. That’s the article of interstate commerce. The ordinance drives out-of-state prices up and does not permit others to process trash in the city, thus out-of-state businesses can’t access that market. There were other nondiscriminatory ways Clarkstown could have handled the health and environmental problems. The goal of the ordinance was purely to finance the new transfer system.
C.A. Carbone, Inc. v. City of Clarkstown, N.Y.
Holding
The ordinance was unconstitutional.
Hunt v. Washington State Apple Advertising Commission
A law that’s facially neutral may violate the Commerce Clause if it discriminates against interstate commerce in practice.
Hunt v. Washington State Apple Advertising Commission
Issue
Whether North Carolina’s rule requiring apples to be labeled with only the federal label grades had a negative effect on interstate commerce.
Hunt v. Washington State Apple Advertising Commission
Facts
North Carolina required apples to show federal label grades only, so apples imported from Washington couldn’t show their labels, which were stricter.
Hunt v. Washington State Apple Advertising Commission
Reasoning
The law discriminatory because it forced Washington to change their labels, which cost them money and also leveled the marketing to Washington’s detriment. It failed strict scrutiny.
Exxon v. Governor of Maryland
A state may enact a law that has a negative effect on some businesses as long as interstate commerce is not affected.
Exxon v. Governor of Maryland
Issue:
Whether Maryland’s law prohibiting gas producers and refiners from selling gas within the state discriminated against or unduly burdened interstate commerce.
Exxon v. Governor of Maryland
Facts:
A law said gas producers and refiners could not operate retail gas stations in the state. As a result, major refiners lost the business they did in Maryland and local retailers profited from it
Exxon v. Governor of Maryland
Reasoning:
Many out-of-state retailers weren’t affected. Interstate shipments of gas continues through a different market structure. The dormant commerce clause protects commerce, not companies.
Exxon v. Governor of Maryland
Holding:
The law was upheld.
Maine v. Taylor
A state may stop importation of certain goods as long as it serves a legitimate local purpose and there’s no other way to accomplish that purpose.
Maine v. Taylor
Issue
Whether Maine’s law banning the importation of baitfish violated the dormant commerce clause
Maine v. Taylor
Facts
Maine ban live baitfish from being imported into the state
Maine v. Taylor
Reasoning
The law satisfied the Pike test because the state’s purpose was to protect Maine’s “unique and ecologically fragile” fisheries and there was no other way to do that.
Great Atlantic & Pacific Tea Co v. Cottrell
A state may not justify a discriminatory law by saying it promotes interstate commerce. Laws that discriminate for the purpose of opening up interstate commerce must still survive strict scrutiny.
Great Atlantic & Pacific Tea Co v. Cottrell
Issue
Whether Mississippi’s reciprocity law violated the dormant commerce clause
Great Atlantic & Pacific Tea Co v. Cottrell
Facts
Louisiana refused to import milk from Mississippi so it passed a law that prohibited the sale of out-of-state milk and milk products unless the other states would accept Mississippi’s Grade A milk products in return.
Great Atlantic & Pacific Tea Co v. Cottrell
Reasoning
The law was discriminatory. If Mississippi didn’t like Louisiana’s law, it could have brought a federal suit under the Commerce Clause. It’s better litigate the controlling law than try to create law to solve the problem
New Energy Co. of Indiana v. Limbach
The dormant Commerce Clause only stops states from giving their citizens an advantage in connection to interstate commerce. States are free to subsidize businesses in their state.
Market-Participant Exception
This “market-participant” exception reflects a “basic distinction . . . between States as market participants and States as market regulators,” Reeves v. Stake, 447 U.S. 429 (1980), “there [being] no indication of a constitutional plan to limit the ability of the States themselves to operate freely in the free market.”
Hughes v. Alexandria Scrap
When a state is acting as a market participant, it may favor its own citizens.
South-Central Timber Development Inc. v. Wunnicke
States may impose burdens on commerce within the market they are buying from but no further. The state could limit who it sold to but no who their buyers sold to.
United Haulers Ass’n, Inc. v. Oneida-Herkimer Solid Waste Management Authority
The court upheld an ordinance that required trash to be delivered to a state-owned processing plant because dormant Commerce Clause doesn’t apply when states are providing services to their citizens. This was almost the same as Carbone but the plant was owned by the town.
