MIE 305 Chapter 4 study guide

Note Table 4-1, the timeline of development of commerce powers- you don't have to be an expert on every single fact in every single case, but you're expected at least to be able to recognize important tests or doctrines, their significance to the federal commerce power, and the cases out of which they came.

(1) Gibbons v. Ogden, 22 U.S. 1 (1824) - Congress' power to regulate interstate commerce was inclusive of navigation (movement of goods); defined "commerce" more broadly to include more aspects of the entire commercial transaction than merely the moment items of value were exchanged. Nevertheless maintained distinction between interstate and intrastate (transactions occurring solely within one state) commerce, but noted that intrastate transactions connected to interstate commerce were regulable. Congress' power over commerce is plenary (unqualified and absolute) by constitutional design. (2) Houston East & West Texas Railway Co. v. U.S., 234 U.S. 342 (1914) - The most famous of the "Shreveport Rate Cases," as they became known. In it, the Court had to address in more detail Congress' power to regulate interstate commerce if the activity affecting it existed or was occurring (technically) solely within one state. Writing for the Court, then-Associate Justice Charles Evans Hughes established the close and substantial relation test—even if on its face the questioned activity appears to be intrastate, Congress may determine that it has such a relation with, and thus affects, interstate commerce and regulate it (in this case, with the new Interstate Commerce Commission). (3) Stafford v. Wallace, 258 U.S. 495 (1922) - Congress passes the Packers & Stockyards Act to regulate many aspects of the meat-packing industry, inclusive of stockyards in a single state. Stockyard owner sues the Secretary of Commerce, claiming that all the yard's commercial activity begins and ends in one state (Illinois), and is therefore not subject to federal regulation. Chief Justice (later President) Taft, writing for the court, points out that the "stockyards are not a place of rest or final destination.... [They] are but a throat through which the current flows, and the transactions which occur therein are only incident to this current from the West to the East, and from one state to another. Such transactions cannot be separated from the movement to which they contribute and necessarily take on its character." Court creates the stream of commerce standard (or test) for gauging an intrastate actor's effect on interstate commerce. (4) Lochner-era cases - A group of cases spanning a time period starting in the early 20th Century which comes to a head in the 1920s and early 1930s, but is named for and generally started with Lochner v. NY, 198 U.S. 45 (1905). In these cases, a more laissez-faire markets group of Justices found a group of business law cases in which they could strike down government attempts at safety and employment regulations, such as (in Lochner itself), a maximum-hours-work-week state law. Later cases would strike at worker safety, minimum wage and child labor laws in various states, and in particular, the Court was significantly at odds with the Franklin D. Roosevelt administration and the Democratic Congress in the early days of the New Deal.

Note Table 4-1, the timeline of development of commerce powers- you don't have to be an expert on every single fact in every single case, but you're expected at least to be able to recognize important tests or doctrines, their significance to the federal commerce power, and the cases out of which they came.

(5)Roosevelt's Court-Packing Plan and the "Switch in Time That Saved Nine" After numerous defeats (by the barest of 5-4 margins) at the Supreme Court for key New Deal legislation, President Roosevelt proposed a plan to expand the Supreme Court to dilute, effectively, the power of the 5-Justice "anti-New Deal alliance." The plan was remarkably unpopular among Republicans and Democrats alike, and was later withdrawn. At the same time, however, Associate Justice Owen Roberts, part of that alliance, shifted his voting pattern in West Coast Hotel v. Parrish, 300 U.S. 379 (1937), to uphold a Washington state minimum wage law. Once Roberts became a second swing vote on the Court along with Chief Justice Hughes', the New Deal Congress had a substantially easier time passing the legislation they had earlier wanted to approve. (6)NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937) -National Labor Relations Board brings a union-busting action against the company for firing workers who were in concert with each other to unionize it. Jones & Laughlin refuses to pay the NLRB's fine and rehire the workers on grounds that Congress overstepped its commerce clause authority by creating and empowering the Board. The company probably would have won prior to the "Switch in Time That Saved Nine," but both swing votes on the Court, Hughes and Roberts, voted with the majority to hold that the Commerce Clause does empower Congress to regulate labor relations due to (as Hughes once again put it in this opinion) the "close and substantial relation" to which large-scale companies like Jones & Laughlin have with interstate commerce. After 1937, the Court will not again seriously challenge Congress' use of the interstate commerce clause until US v. Lopez (below). (7)Wickard v. Filburn, 317 U.S. 111 (1942) - A farmer who grew more than his quota of wheat during production limitations to stabilize the market under the Agricultural Adjustment Act challenged his civil fine on grounds that the excess he produced was for personal consumption, and was never intended to be put on the market for wheat. The Court created and applied the aggregation doctrine to Roscoe Filburn's plea; by itself, one farmer's personal overproduction may not have a dramatic effect on interstate commerce, although it certainly has an effect given that the farmer then doesn't have to appeal to the market to secure the wheat he desires. When multiple farmers' doing the same thing is aggregated, however, the burden on interstate commerce becomes more severe, and can in fact frustrate the very goals that acts like AAA were designed to effect in the first place. (8)Heart of Atlanta Motel v. U.S., 379 U.S. 241 (1964) and Katzenbach v. McClung, 379 U.S. 294 (1964) See case feature on Heart of Atlanta below. - Cases brought under the Civil Rights Act of 1964 barring racial discrimination by businesses engaged in interstate commerce. Challenged by local businesses on grounds that Congress' passage of CRA was not really intended to regulate interstate commerce, but was rather a moralistic law that was designed solely to strike at racial segregation in covered jurisdictions. Court rejected that argument, finding that an appropriate connection to interstate commerce was enough to uphold Congress' actions, despite other interpretations of Congress' intention that may be argued or apply. (9)U.S. v. Lopez, 514 U.S. 549 (1995) -Perhaps the most significant commerce clause case since the 1930s, and a harbinger of what is now called "New Judicial Federalism" (a newfound appreciation by the Court for the powers and prerogatives of state courts and legislatures) that developed in the Rehnquist (and appears to be hanging on in the Roberts) Court. The Court ruled against Congress use of the interstate commerce clause in its passage of the federal Gun Free School Zones Act of 1990, on grounds that the connections Congress attempted to make between the Act and an effect on interstate commerce were too tenuous or remote to take seriously. At the same time, the Act had a dramatic (and unconstitutional) effect on preempting school safety, traditionally a strong general police power of the states.

Kasky v. Nike in your book on commercial speech.

- California legislature prohibited a business from making false or misleading advertising; Nike was sued for false advertising over whether or not their products were made in sweatshops.

Gibbons v. Ogden (1824, Marshall)

--(1824, Marshall) - *Only Congress may regulate interstate commerce.* --affirmed congressional power over interstate commerce --Clarified the commerce clause and affirmed Congressional power over interstate commerce.

What is the "dormant commerce clause," and from where does it come?

. It is very important to remember two things about this doctrine from the beginning. First, as the name implies, it is used only when Congress is legislatively silent on a matter in which a state or states seem to be having a negative effect on interstate commerce—in other words, when Congress is dormant on the matter. If Congress acts or has acted, it is no longer "dormant" and the dormant commerce clause (DCC) will not therefore apply. Secondly, as the name does not imply, the DCC is not technically a "clause" in the sense that it is nowhere to be found actually enumerated in the Constitution—not even next to the interstate commerce clause itself. We call it a clause, but in reality, it is a product of case interpretation and applica-tion of precedents from the Supreme Court itself, and arguably a clear notion of the principles of the DCC were around at the Constitutional Convention itself. Justice Anthony Kennedy has explained in caselaw that "the central rationale for the [dormant commerce clause] is to prohibit state or municipal laws whose object is local economic protectionism, laws that would excite those jealousies and retaliatory measures the Constitution was designed to prevent."

Articles of Confederation

1st Constitution of the U.S. 1781-1788 (weaknesses-no executive, no judicial, no power to tax, no power to regulate trade)

Dormant commerce clause

A restriction on states' authority that is implied in the commerce clause of the U.S. Constitution: The power given to Congress to enact legislation that affects interstate commerce in effect prohibits a state from passing legislation that improperly burdens interstate commerce.

checks and balances

A system that allows each branch of government to limit the powers of the other branches in order to prevent abuse of power

Difference between Articles and Amendments

Article I - The Legislative Branch. The principal mission of the legislative body is to make laws. It is split into two different chambers - the House of Representatives and the Senate. Congress is a legislative body that holds the power to draft and pass legislation, borrow money for the nation, declare war and raise a military. It also has the power to check and balance the other two federal branches. Article II - The Executive Branch. This branch of the government manages the day-to-day operations of government through various federal departments and agencies, such as the Department of Treasury. At the head of this branch is the nationally elected President of the United States. The president swears an oath to 'faithfully execute' the responsibilities as president and to 'preserve, protect and defend the Constitution of the United States'. Its powers include making treaties with other nations, appointing federal judges, department heads and Ambassadors, and determining how to best run the country and run military operations. Article III - The Judicial Branch. Article III outlines the powers of the federal court system. Determines that the court of last resort is the US Supreme Court and that the US Congress has the power to determine the size and scope of those courts below it. All judges are appointed for life unless they resign due to bad behaviour. Those facing charges are to be tried and judged by a jury of their peers. Article IV - The States. This article defines the relationship between the states and the federal government. The federal government guarantees a republican form of government in each state, protects the nation and the people from foreign or domestic violence, and determines how new states can join the Union. It also suggests that all the states are equal to each other and should respect each other's laws and the judicial decisions made by other state court systems. Article V - Amendment. Future generations can amend the Constitution if the society so requires it. Both the states and Congress have the power to initiate the amendment process. Article VI - Debts, Supremacy, Oaths. Article VI determines that the US Constitution, and all laws made from it are the 'supreme Law of the Land', and all officials, whether members of the state legislatures, Congress, judiciary or the Executive have to swear an oath to the Constitution. Article VII - Ratification. This article details all those people who signed the Constitution, representing the original 13 states.

Necessary and Proper Clause (Elastic Clause)

Clause of the Constitution (Article I, Section 8, Clause 3) setting forth the implied powers of Congress. It states that Congress, in addition to its express powers, has the right to make all laws necessary and proper to carry out all powers the Constitution vests in the national government

Speech being among the "preferred freedoms," what are the main differences between how noncommercial and commercial speech are protected?

Commercial speech--- Speech that relates to a business transaction (Some commercial speech, primarily speech that misleads, receives no protection from the First Amendment. Other types of commercial speech receive an intermediate level of protection.) the Supreme Court grants a limited amount of freedom of speech protection to commercial speech as long as the speech does not mislead. For commercial speech that misleads (or promotes illegal activity), however, freedom of speech protection simply does not apply. Therefore, advertising and marketing activities may be subject to federal and state laws geared to prevent consumers from being misled. Where government regulation of commercial speech is not directed at misleading customers, what is the level of protection afforded to business? The Supreme Court has articulated an intermediate level of scrutiny. Under this test, the freedom of speech clause is not violated if a substantial government interest is furthered by the restriction, the restriction directly advances that interest, and the restriction is no more extensive than necessary. As illustrated in the following case, it is sometimes difficult to categorize speech as political or commercial, and if commercial, whether the speech falls within the type of speech that misleads and therefore deserves no constitutional protection. Noncommercial Speech-- For noncommercial speech entitled to full First Amendment protection, a content-based regulation is valid under the First Amendment only if it can withstand strict scrutiny, which requires that the regulation be narrowly tailored (that is, the least restrictive means) to promote a compelling government interest. Message that does not have an economic motivation and therefore is fully protected under the First Amendment

Commerce Clause (Article 1, Section 8)

Congress can regulate commerce with foreign nations, among the several states.

Stafford v. Wallace, 258 U.S. 495 (1922)

Congress passes the Packers & Stockyards Act to regulate many aspects of the meat-packing industry, inclusive of stockyards in a single state. Stockyard owner sues the Secretary of Commerce, claiming that all the yard's commercial activity begins and ends in one state (Illinois), and is therefore not subject to federal regulation. Chief Justice (later President) Taft, writing for the court, points out that the "stockyards are not a place of rest or final destination.... [They] are but a throat through which the current flows, and the transactions which occur therein are only incident to this current from the West to the East, and from one state to another. Such transactions cannot be separated from the movement to which they contribute and necessarily take on its character." Court creates the stream of commerce standard (or test) for gauging an intrastate actor's effect on interstate commerce.

Separation of powers

Constitutional division of powers among the legislative, executive, and judicial branches, with the legislative branch making law, the executive applying and enforcing the law, and the judiciary interpreting the law

What're the differences between enumerated, implied, amendment-enforcing and concurrent powers of government?

Enumerated- Powers specifically given to Congress in the Constitution; including the power to collect taxes, coin money, regulate foreign and interstate commerce, and declare war. Implied- Powers inferred from the express powers that allow Congress to carry out its functions. Amendment- A change in, or addition to, a constitution or law Enforcing powers- levy and collect taxes, borrow money, establish courts, define crimes and set punishments, claim private property for public use; taxing citizens and businesses, spending money, establishing courts, protecting civil liberties, passing and enforcing laws -issuing licenses -taxation -environmental regulation -establishing courts -eminent domain Concurrent Powers- powers shared by the state and federal governments

Political speech

Expressions which comment on government action rather than the private conduct of an individual.

Shreveport Rate Case (1914)

Facts of the case The Houston, East and West Texas Railroad and the Texas and Pacific Railway were railroad companies operating rail lines between Shreveport, Louisiana and points in Texas. The Texas Railroad Commission mandated that they charge higher rates on freight travelling between Louisiana and Texas than on freight travelling solely within Texas. The Interstate Commerce Commission (ICC) found that the interstate rates were unreasonable and illegally discriminated against freight traffic originating in Shreveport. The ICC established maximum rates and ordered the railroads to fix their intrastate rate schedules. The railroads challenged the order in United States Commerce Court, alleging that the ICC did not have the power to regulate intrastate commerce. The Commerce Court upheld the ICC order. The railroads then appealed to the Supreme Court. Question Did the ICC have the power to regulate the railroads' intrastate rates? Conclusion Yes. In a 7-2 decision, the Court affirmed the Commerce Court and upheld the ICC order. Congress was granted the power to regulate interstate commerce, which it chose to do through the ICC. This power extended to "matters having such a close and substantial relation to interstate traffic," Justice Charles Evans Hughes wrote for the majority. Since the price discrimination adversely affected interstate commerce, "it is immaterial...that the discrimination arises from intrastate rates as compared with interstate rates." Therefore, the railroads' intrastate rates were subject to regulation and the ICC order was valid. Houston East & West Texas Railway Co. v. U.S., 234 U.S. 342 (1914) The most famous of the "Shreveport Rate Cases," as they became known. In it, the Court had to address in more detail Congress' power to regulate interstate commerce if the activity affecting it existed or was occurring (technically) solely within one state. Writing for the Court, then-Associate Justice Charles Evans Hughes established the close and substantial relation test—even if on its face the questioned activity appears to be intrastate, Congress may determine that it has such a relation with, and thus affects, interstate commerce and regulate it (in this case, with the new Interstate Commerce Commission).

What is a "taking," and by what other more common name do we call it? (eminent domain)

Federal and state governments have the power of eminent domain, a concept that has roots deep in the common law of England. In order for a society to grow and prosper, the government must be able to claim land for public uses, including parks, roads, and government buildings. A provision in the Fifth Amendment guarantees that where the government takes property for public use, the private owner (whether an individual or an entity) is entitled to just compensation. The reach of the takings clause of the Constitution is considerable on a number of fronts. First, the notion of property extends beyond real property. Trade secrets and other intangible property are subject to the provisions of the takings clause, as are rights guaranteed under a contract. Next, governmental action included as a taking is also broadly defined. Included are situations where the government simply imposes zoning restrictions or the government allows others to enjoy the use of the property. Finally, the taking must be for a public use. This term is also broadly construed. The Supreme Court has ruled that public use includes not only purposes that benefit the health, safety, and welfare of the public but also situations where property is resold to a private entity that plans to develop the land. In other words, it is probably constitutional for property containing a few scattered homes to be taken by the government and sold to private developers who build factories that supply additional employment opportunities and increase the taxes generated from the property.

What's the significance of the Kelo case in regards to eminent clause?

Finally, the taking must be for a public use. This term is also broadly construed. The Supreme Court has ruled that public use includes not only purposes that benefit the health, safety, and welfare of the public but also situations where property is resold to a private entity that plans to develop the land. In other words, it is probably constitutional for property containing a few scattered homes to be taken by the government and sold to private developers who build factories that supply additional employment opportunities and increase the taxes generated from the property. As a result of the (in)famous landmark decision in the case that expanded this doctrine of eminent domain, Kelo v. City of New London, 545 U.S. 469 (2005), many states rushed to implement new statutory protections for landowners in their state as a way of attempting to protect their state's residents from what is now commonly referred to as "eminent domain abuse."

Takings Clause 5th Amendment

Government can take private property for a public purpose, but it must provide fair compensation to the owners of that property.

DCC application

If there is evidence that Congress has not acted, however, then one must consider (1) the degree to which the state law or policy burdens interstate commerce, and (2) the overall significance or importance of the law or policy to a substantial or compelling state interest is clear, or can be made clear, to the Court. If the Court sees no clear benefit to the state in the law other than that of economic protectionism favoring in-state interests, a strict scrutiny standard of review is more likely to be forthcoming, and then the state law is likely to be struck down as viola-tive of the DCC.

McCulloch v. Maryland (1819, Marshall)

It wasn't until the Supreme Court heard the matter in McCulloch v. Maryland, 17 U.S. 316 (1819) and applied its relatively new powers of judicial review to produce a final, legally binding constitutional interpretation that the most important ambiguities were resolved. In McCulloch, the central legal question was whether Congress had and could legislate under a series of implied powers that it believed the Necessary and Proper Clause gave it to facilitate its enumerated powers further up in Article I, Section 8. McCulloch became such an important case, in fact, that the headquarters of the Second Bank of the United States, which was the federal institution at issue in the case, is depicted on the cover of this book as symbolic of the important connections between business and law in the United States! Congress had chartered the Second Bank in 1816 to handle the new federal government's fiscal matters, inclusive of managing federal receivables, payables, letters of credit, currency supply for the new federal dollar and so forth. It was headquartered on Chestnut Street in Philadelphia, adjacent to the Old Pennsylvania State House which quickly became known as Independence Hall for its fame as the place where both the Declaration of Independence and the new Constitution had been written. In McCulloch, the Court ruled that the Necessary and Proper Clause was a broad grant of power to Congress, not a restriction as Maryland had argued. Chief Justice Marshall, writing for the Court, created another of his timeless quotes in this case by declaring, "Let the end be legitimate, let it be within the scope of the constitution, and all means which are appropriate [and] plainly adapted to that end... are constitutional."

Police powers

Powers possessed by the states as part of their inherent sovereignty. These powers may be exercised to protect or promote the public order, health, safety, morals, and general welfare.

basic structure of the Constitution

Preamble, 7 articles, 27 amendments

When and how does the condemnation process work?

Process: (1)government IDs land needed. (2) owner contacted, offered FMV. (3)if refused, may negotiate (4) if still refused, government issues a notice of condemnation, takes the land, remits FMV (usually the original offer). There can also be constructive takings, in which government regulates the use of land so much that courts consider it to have been "taken" w/o passage of title to the government. 745 (1947)

Note the broad commerce powers of Congress (interstate- I've never tested on the foreign or Indian clauses other than a simple demonstration of knowledge that they exist).

The Commerce Clause describes an enumerated power listed in the United States Constitution (Article I, Section 8, Clause 3). The clause states that the United States Congress shall have power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." Congress' substantial legislative and regulatory power over trade between the states.

Commercial Speech Doctrine

The government may regulate advertising that is false, misleading, or deceptive The government may regulate advertising for unlawful goods and services

Spotting a Dormant Clause

When trying to spot a dormant commerce clause issue, a good student of constitutional law is always best advised first to look for any evidence in the known fact pattern about whether Congress has or has not addressed the situation at hand with federal legislation. If Congress has acted, the DCC analysis may end there, for Congress is no longer dormant on the matter.

Federalism

a form of government in which power is divided between the federal, or national, government and the states

Kelo vs. City of New London (2005)

case decided by the Supreme Court of the United States involving the use of eminent domain to transfer land from one private owner to another private owner to further economic development. In a 5-4 decision, the Court held that the general benefits a community enjoyed from economic growth qualified private redevelopment plans as a permissible "public use" under the Takings Clause of the Fifth Amendment. The case arose in the context of condemnation by the city of New London, Connecticut, of privately owned real property, so that it could be used as part of a "comprehensive redevelopment plan." However, the private developer was unable to obtain financing and abandoned the redevelopment project, leaving the land as an undeveloped empty lot

Due process

fair treatment through the normal judicial system, especially as a citizen's entitlement.

Supremacy Clause (Article VI)

federal law is more important that state laws is more important than smaller laws

State Action Doctrine

rule stating that only the actions of state and local governments, not those of private individuals, must conform to the equal protection clause