Facially neutral laws with a disproportionate adverse effect on inter-state commerce p.216
- (1), facially discrimination against inter-state commerce, (2) protectionist in purpose or effect , (3)
Pike v. Bruce Church, 397 U.S. 137, p.216
- Home processing requirement ;
- a AZ law prohibited interstate shipment of cantaloupes not packed in regular compact arrangements in closed standard containers ; the Church packed cantaloupes in CA, not in AZ ; when packed in CA, not identified as AZ-grown ;
- Pike balancing test - “Where the statute regulates even-handedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental, it will be upheld unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits. .If a legitimate local purpose is found, then the question becomes one of degree. And the extent of the burden that will be tolerated will of course depend on the nature of the local interest involved, and on whether it could be promoted as well with a lesser impact on interstate activities”
- The law did not have the purpose and design to promote safety or protect consumer from unfit goods ; instead, simply to protect and enhance the reputation of growers within the AZ
- We may assume that the interest is legitimate one ; but the state’s tenuous interest in having the company’s cantaloupes identified as originating in AZ cannot constitutionally justify the requirement that the company build and operate an unneeded $200,000 packing plant in AZ
Note
- The Pike balancing test has proven the most contested aspect of dormant commerce clause review
Kassel v. Consol. Freightways Corp., 450 U.S. 662, p.217
- A state truck length regulation ; a law that banned the use of 65-foot long double trailers from its interstate highways with some exemption
Held
- The harm to inter-state commerce exceeded the safety benefit to the state
Reasoning
- Although state regulation of highways safety were given “special deference” traditionally by the courts and presumptively valid,, the presumption was overcome where (i) the negative impact on inter-state commerce was substantial and (ii) the alleged safety reasons for enacting the statute were unproven
- The IA statute imposed a disproportionate burden on out-of-state residents and business ; thus, the statute was not to be accorded the “special deference” traditionally accorded to state highway safety regulations,, in that the statute contained exemptions which procured to IA many of the benefits of large trucks while shunting to neighboring states many of the costs associated with their use
<presumption of validity as to bona fide state safety (public health) regulation>
- When it comes to state safety regulation, if safety justifications are not illusory, the court will not second-guess legislative judgment about their importance, in comparison with related burdens on inter-state commerce
- Those who would challenge bona fide state safety regulation, must overcome strong presumption of validity
- State regulation for purpose of promoting public health or safety, nevertheless,, may further purpose so marginally, and interfere with commerce to substantially,, as to be invalid under commerce clause
- must consider weight and nature of state regulatory concern in light of extent of burden imposed on inter-state commerce
concurring
- (both plurality and dissent looked to factual record created by the state’s lawyers in trial court, as opposed to legislative history
- In considering a commerce clause challenge to a state regulation, the judicial task is to balance the burden imposed on commerce against the local benefit sought to be achieved by the state’s lawmakers ;
- test is whether the lawmakers could rationally have believed that the challenged regulation would foster those purposes ; not whether in fact the regulation promotes its intended purpose
note
South Carolina State Highway Dep't v. Barnwell Bros., Inc., 303 U.S. 17, p.222
- upheld a SC law which prohibited the use on state highways of truck that were over 90 inches wide or that had a gross weight over 20,00 pounds
Southern Pacific 325 US 751
- invalidated AZ law which prohibited railroad of more than 14 passengers or 70 freight cars
- Lewis , 447 US 27 : invalidated a FL law which prohibited ownership of local investment advisory biz by out-of-state banks
- The law is “parochial” in the sense that it overtly prevents foreign enterprises from competing in local markets
Article I restraints on state regulation of commerce
- (1) dormant commerce clause – Congress is silent on a given subject matter
o An objection to state regulation rests on negative implication of the commerce clause of Art. I, sec. 8, cl. 3
- (2) Congress did exercise commerce power – challenge inconsistent state action (regulation)
o i) rest on exercise of commerce power (state can argue against it )
o ii) the preemptive effect of the federal legislation under the Supremacy Clause of Art. VI
Article IV.Sec.2 restraints on state regulation of commerce
- the Privileges and Immunities Clause of Article IV, Sec. 2 – guarantees to the Citizens of each state all Privileges and Immunities of Citizens in the several States
- this provision bars certain state legislation that discriminates against out-of-state economic interests
Sec. 2. The inter-state privilege and immunities clause of article IV p.225
(sec. 3 congressional ordering of federal-state relationship by preemption and consent)
(sec. 4. Other aspect of federal – state relationship)
Art.4.Sec.2 – the citizens of each state shall be entitled to all privileges and immunities of citizens in the several states
- severs as a restraint on state effort to bar out-of-staters from access to local resources
- (i) Art.4.Sec.2 and (ii) Art.1 Sec.8.Cl.3 – mutually reinforcing relationship that stems from shared vision of federalism ; (iii) Equal Protection Clause of the 14th protects citizens against discrimination on the basis of state residency
- è.. invoke the three (i) – (iii) , when it comes to state’s effort to favor in-staters
- Corporation enjoy no protection under the Art.4.Sec.2
- Congress may authorize, through affirmative exercise of its commerce power, state practices that would otherwise be impermissible under the dormant commerce clause ; by contrast, Art.4.Sec.2, arguably, Congress cannot waive
- Art.4.Sec.2 not extend to all commercial activity, but only to exercise of fundamental rights
- No market participant exception under the Art.4.Sec.2
United Bldg. & Constr. Trades Council v. Camden, 465 U.S. 208, p.226
- Challenge to a Camden, NJ, ordinance requiring that at least 40% of the employees of contractor and subcontractors working on the city construction projects be Camden residents
- The Camden Council challenged the ordinance as a violation of both the Art.4.Sec.2 and dormant commerce clause
- Held, dropped the commerce clause challenge, and found potential merit in Art.4.Sec.2 challenge, rejected market participant exemption, remanded the case
(1),
- fact that ordinance was municipal, rather than state, law did not place it outside scope of Art.4.Sec.2. , particularly where municipal ordinance would not have gone into effect without express approval of State Treasurer
- It is as true of privileges and immunities clause as of equal protection clause that what would be unconstitutional if done directly by state can no more readily be accomplished by city deriving its authority from state (DO- if act of state is unconstitutional , the same act by city too)
- Terms “citizen” and “resident” are essentially interchangeable for purposes of privileges and immunities clause analysis
- Municipal ordinance was not immune from privileges and immunities clause analysis merely because some in-state residents were similarly disadvantaged (as out-of-state residents)
here
- City ordinance requiring that at least 40% of employees of contractors and subcontractors working on city construction projects be city residents,, was properly subject to privileges and immunities clause Art.4.Sec.2
(2),
- Application of privileges and immunities clause to (particular incidence of) discrimination against out-of-state residents entails two-step inquiry: (i) whether ordinance burdens one of those privileges and immunities protected by clause; and if so, (ii) whether there is substantial reason for discrimination against citizens of other state
(3),
- (Rationale of Art.4.Sec.2) - Privileges and immunities clause imposes direct restraint on state action in interests of interstate harmony (consider interest of inter-state harmony when determining whether fall within the privilege and immunities)
- out-of-state resident's interest in employment by private employers on public works projects in another state was sufficiently fundamental to promotion of interstate harmony and sufficiently basic to livelihood of the nation as to fall within purview of privileges and immunities clause
o , application, state that “out-of-state resident’s interest … is fundamental to promotion of inter-state harmony”
(4),
- whether such reasons do exist and whether degree of discrimination bears close relation to them
-
Here
- Since it was impossible to evaluate, on record as it stood, city's justification for ordinance requiring that at least 40% of employees of contractors and subcontractors working on city construction projects be city residents, remand to state Supreme Court was appropriate
Dissent
-
- the Privileges and Immunities Clause … settled : a State may not discriminate between its own residents and residents of other States on the basis of state citizenship ; however, the Court extends the scope of the Clause … to laws that discriminate among state residents on the basis of municipal residence, simply because discrimination on the basis of municipal residence disadvantages citizens of other States "ipso facto." … This novel interpretation … little practical justification and no historical or textual support whatsoever … I believe that the Privileges and Immunities Clause was not intended to apply to the kind of municipal discrimination presented by this case,
note
- not every activity count as a “privilege” ; only fundamental activities count
Supreme Court v. Piper, 470 US 274 , p.231
- a state rule limiting bar admission to in-state residents violated the Art.4.Sec.2
- “the practice of law is important to the national economy”
-
Sec. 3. congressional ordering of federal-state relationship by preemption and consent p.232
- Dormant commerce clause – limits state regulatory power
- Federal law supersedes a contrary state law because of Supremacy Clause (Art. VI)
- The Court’s preemption ruling turns on determination of Congressional intent
