Commerce Clause

Interpretation of Commerce Clause

Before the New Deal/Early Development (Pre-1937)

1800 - 1937

Judicial Limits on the Commerce Clause

1895 - 1918

After the New Deal (1937 – 1995)

1937 - 1995

Revival of Commerce Clause & Obamacare (1995 – Present)

1995 - 2017

Events

Gibbons v. Ogden

1824

Dispute between two steamboat operators over who was allowed to navigate on which waterways. CJM held that commerce was not limited to buying and selling of goods, but broadly extended to cover navigation, can reach into states, included intercourse and local activities “which affect” the states or other states.

US v. E.C. Knight Co

1895

Direct/Indirect – The Sherman Antitrust Act, Court held that refining sugar is manufacturing, not commerce, and so the effect on commerce was indirect and could not be regulated. (Sugar refinery that owns 96% of sugar is not a monopoly…breaking up is in police power of states). Narrow, formal interpretation.

Champion v. Ames

1903

Lottery Case – Court held that Congress could regulate the trafficking of lottery tickets, thought they were immoral, so banned them. This is a valid regulation of interstate commerce (prohibit from entering stream of interstate commerce because deemed to be harmful).

Broad authority to regulate subject of traffic under plenary Commerce power. Regulating public morals, prohibiting shipments.

Dissent: Police power generally reserved for the states? Health and welfare of citizens.

Swift & Co. v. US

1905

The Sherman Act applied to meat prices because they are in the “Stream of Commerce.” Congress had authority to enact. Regulate flow of items between the states. Activities with Substantial Economic Effects on interstate commerce.

Schreveport Rate Cases

1914

Affecting Commerce – Congress had power to regulate interstate commerce, including matters having such a close and substantial relation to interstate traffic.

Congress may regulate operations in all matters having a close and substantial relation to interstate traffic, to the efficiency of interstate service, and to the maintenance of conditions under which interstate commerce may be conducted upon fair terms.

Hammer v. Dagenhart

1918

Struck down a child labor law as exceeding congressional power. Harm Congress was trying to remedy was in manufacturing, and not goods itself, therefore unconstitutional as usurping states rights.

Dissent: Can regulate anything, even if incidental effects.

Shift away from general deference to Congress.

Schechter Poultry Corp v. US

1935

The sick chicken case. Court held that the Act unconstitutionally delegated legislative power and that application to intrastate activities exceeded commerce power – wages and hours at slaughterhouse, sold only to local poultry retailers, not subject to federal control.

Carter v. Carter Coal Co

1936

Court invalidated the Bituminous Coal Conservation Act (regulated maximum hours and min wages in coal mines) – effect of labor provisions fall upon production and not commerce, production is a purely local activity. No direct effect.

NLRB v. Jones & Laughlin Steel Corp.

1937

Congress may regulate labor relations under its Commerce Clause power because labor relations have such a close and substantial relationship to interstate commerce that their control is essential to protect that commerce from burdens and obstructions.

Broad interpretation of what counts as interstate commerce - ability to regulate more commercial activity than ever before.

West Coast Hotel - The Switch in Time that Saved Nine

1937

A state may regulate the minimum wage paid to female employees when that regulation is for the purpose of promoting employees’ health, safety and general welfare.

Strategic political move to protect the Court's integrity and independence from FDR's court packing plan or coincidental ideological shift decided two weeks before?

FDR's Court Packing Plan Fails

1937

1935-1936 Decisions persuaded FDR that strong measures were needed to save the New Deal from judicial invalidation.

Senate Judiciary committee rejected the proposal in June. "It is a measure which should be so emphatically rejected that its parallel will never again be presented to the free representatives of the free people of America."

U.S. v. Darby

1941

Congress may regulate the labor standards involved in the manufacture of goods for interstate commerce and may exclude from interstate commerce any goods produced under substandard labor conditions.

Landmark decision for CC jurisprudence and federal labor legislation. Broadened scope of CC and increased power to pass economic legislation.

Wickard v. Filburn

1942

Congress may regulate local activity if that activity has a substantial economic effect on interstate commerce. Agricultural Adjustment Act of 1938 limited the area that farmers could devote to wheat production in an effort to stabilize the national price of wheat. Filburn argued could not regulate wheat wholly for individual consumption. Court held they could – because of the Aggregate effect of homegrown wheat on commercial wheat market.

Katzenbach v. McClung & Heart of Atlanta Motel

1964

Deference to Congressional findings.

Katzenbach - Congress may regulate the discriminatory policies of restaurants through Title II of the Civil Rights Act if those policies have a substantial effect on interstate commerce.

Heart of Atlanta - Congress may enact regulations that prevent racially discriminatory policies in hotel accommodations because of the negative effects of those policies on interstate commerce.

U.S. v. Lopez

1995

Congress may not, pursuant to its Commerce Clause powers, pass a law that prohibits the possession of a gun near a school.

First time in 60 years struck down/limited Commerce power. Dramatically redefined balance between state and federal power.

U.S. v. Morrison

2000

Violence Against Women Act (VAWA), which contained a provision for a federal civil remedy for victims of gender-based violence.

A key consideration in Lopez was the criminal, non-economic nature of the conduct at issue. Similarly, gender-based violence is a non-economic activity. Any link between the two is attenuated.

Congress does not have the authority under the Commerce Clause to regulate violence against women because it is not an economic activity.

Gonzales v. Raich

2005

Court cited Wickard to uphold the broad federal power to regulate marijuana, trumping states and localities. Quintessential case at the height of the period of Court deference to expansive power of Congress under CC.

NFIB v. Sebelius

2012

Challenged two key provisions of ACA: 1) Individual Mandate, and 2) Medicaid Expansion provision

1) Individual Mandate – Was this constitutional under Congress’ commerce power? No – CC does not empower Congress to compel individuals to engage in commercial activity (regulating inactivity). Slippery slope – at some point engage is not enough, could lead to Congress being able to mandate people to buy vegetables (really, bruh). Ultimately upheld the individual mandate, OK under Taxing – N & P clause. Interpreted penalty as a tax.

2) Can’t withhold. Severable from remainder of act, so left intact.

Dissent – Ginsburg – rational basis to believe uninsured population substantially affected interstate commerce, there was a reasonable connection to problem.