Chapter 3: Business and the Constitution

The Takings CLause

1. Property. 2. Taking. 3. Public use. 4. Just compensation.

Suspect Classes

1. Race and national origin 2. Alienage. 3. Sex. 4. Illegitimacy.

Ninth Amendment

Amendment establishing that the people have rights in addition to those specified in the Constitution.

Tenth Amendment

Amendment establishing that those powers neither delegated to the federal government nor denied to the states are reserved to the states and to the people.

Seventh Amendment

Amendment guaranteeing the right to trial by jury in a civil case involving at least twenty dollars.

Fifth Amendment

Amendment guaranteeing the rights to indictment by grand jury, to due process of the law, and to fair payment when private property is taken for public use; prohibits compulsory self-incrimination and double jeopardy.

Sixth Amendment

Amendment guarantees the accused in a criminal case the right to a speedy and public trial by an impartial jury and with counsel. The accused has the right to cross-examine witnesses against him or her and to solicit testimony from witnesses in his or her favor.

First Amendment

Amendment guarantees the freedoms of religion, speech, and the press and the rights ti assemble peaceably and to petition the government.

Third Amendment

Amendment prohibiting , in peacetime, the lodging of soldiers in any house without the owner's consent.

Eighth Amendment

Amendment prohibiting excessive bails and fines, as well as cruel and unusual punishment.

Fourth Amendment

Amendment prohibiting unreasonable searches and seizures of persons or property.

Second Amendment

Amendment the states the right off the people to keep and bear arms shall not be infringed.

Search warrant

An order from a judge or other public official authorizing the search or seizure. Required by the Fourth Amendment.

Contract Clause

Article I, section 10 of the Constitution states: "No State shall . . . pass any . . . Law impairing the Obligation of Contracts." Known as the Contract Clause, this provision deals with state laws that change the parties' performance obligations under an existing contract after that contract has been made.

The Spending Power

Article I, section 8 also gives Congress a broad ability to spend for the general welfare. By basing the receipt of federal money on the performance of certain conditions, Congress can use the spending power to advance specific regulatory ends. Conditional federal grants to the states, for instance, are common today.

The Taxing Power

Article I, section 8 of the Constitu- tion states that "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises." The main purpose of this taxing power is to provide a means of raising revenue for the federal government. The taxing power, however, may also serve as a regulatory device.

Equal protection clause

Clause applicable to both state and federal government by the Fifth and Fourteenth Amendments. It means that the government cannot enact laws that treat similarly situated individuals differently.

Establishment clause

Clause contained within the first part of the First Amendment, prohibiting the government from establishing a state-sponsored religion, as well as from passing laws that promote (aid or endorse) religion or show a preference for one religion over another.

Free exercise clause

Clause contained within the second part of the First Amendment, guaranteeing that a person can hold any religious belief that he or sheet wants, or a person can have no religious belief.

Due process clause

Clause established through the Fifth and Fourteenth Amendments, requiring both procedural due process (the government must give a person proper notice and an opportunity to be heard before taking life, liberty, or property from them) and substantive due process (content of legislation) to be carried out.

Federal Regulatory Power

Commerce clause The Taxing Power Supremacy clause

Commerce clause

Derived from Article I, Section 8 of the Constitution. Expressly delegated to the national government the power to regulate interstate commerce. Clause which provides the basis for the national government's extensive regulation of state and even local affairs

Privileges and immunities clause

Derived from Article IV, Section 2 of the Constitution. Clause which prevents a state from imposing unreasonable burdens on citizens of another state--particularly with regard to means of livelihood or doing business.

Full faith and credit clause

Derived from Article IV, Section1 of the Constitution. Clause which ensures the rights established under deeds, wills, contracts, and similar instruments in one state will be honored by other states. Only applicable to civil matters.

Supremacy clause

Derived from Article VI of the Constitution. Clause which provides that the Constitution, laws, and treaties of the United States are "the supreme Law of the Land. " When there is direct conflict between a federal law and a state law, the state law is rendered invalid.

independent checks

Federal legislation cannot be constitutional if it is not based on a power specifically stated in the Constitution. Second, the U.S. Constitution limits both state and federal power by plac- ing certain independent checks in the path of each.

non commercial Speech

Full cover by the 1st amendment Government action is constitutional only if action is necessary to fulfillment of compelling government purpose. Otherwise, government action violates First Amendment.

Symbolic speech

Gestures, movements, articles of clothing, and other forms of expressive conduct which are also given substantial protection by the courts.

Commercial (misleading or about unlawful activity)

Government action is constitutional.

Strict scrutiny

Here, the court might say that the challenged law must be necessary to the fulfillment of a compelling government purpose. Government action that is subjected to this rigorous test of constitutionality is usually struck down.

Commercial (nonmisleading and about lawful activity) Speech

Intermediate protection Government action is constitutional if government has substantial underlying interest, action directly advances that interest, and action is no more extensive than necessary to fulfillment of that interest (i.e., action is narrowly tailored).

Police powers

Name for state regulatory powers. Gives states the broad rights to regulate private activities to protect or promote the public order, health, safety, morals, and general welfare.

Fourteenth Amendment

No State shall deprive any person of life, liberty, or property, without due process of law

Business and the First Amendment

Political and Other Noncommercial Speech Commercial Speech

three general kinds of means-ends tests:

Rational basis test. intermediate scrutiny full strict scrutiny

Probable cause

Reasonable grounds or trustworthy evidence that a law officer must present in order to obtain a search warrant.

means- ends test

Such tests are judicially created because no constitutional right is absolute, and because judges therefore must weigh individual rights against the social purposes served by laws that restrict those rights. In other words, means-ends tests determine how courts strike the balance between indi- vidual rights and the social needs that may justify their suppression.

Compelling government interest

Test under which the government's interest is balanced against the individual's constitutional right to free expression. This test must be passed in order for a statute to be valid.

Takings Clause

The Takings Clause both recognizes government's power to take private property and limits the exercise of that power. It does so by requiring that when property is subjected to a governmental taking, the taking must be for a public use and the property owner must receive just compensation. We now consider these four aspects of the Takings Clause in turn.

Intermediate scrutiny

This comes in many forms; the sex discrimination test

The "rational basis" test

This is a very relaxed test of constitutionality that challenged laws usually pass with ease. A typical formulation of the rational basis test might say that government action need only have a reasonable relation to the achievement of a legitimate government purpose to be constitutional.

Preemption

When Congress acts in an area in which the federal government and the states have concurrent powers, and it gives a valid federal statute or regulation precedence over a conflicting state or local law on the same general subject.

eminent domain

it has come into play when the government formally condemns land through its power of eminent domain,3 but it has many other applications as well.

enumerated powers

it restricts federal legislative authority by listing the powers Congress can exercise.

The original purpose of the Contract Clause

to strike down the many debtor relief statutes passed by the states after the Revolution. These statutes impaired the obliga- tions of existing private contracts by relieving debtors of 2Under the Fifth Amendment's Due Process Cause, standards similar to those described in this section apply to the federal government. what they owed to creditors.