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INTRO: HISTORICAL BACKGROUND OF THE CONST. 1. The Constitution creates a limited government. Therefore, every exercise of national power/authority must be linked to a

constitutionally granted power.a. State actions can also be evaluated to the extent that they:

i. Infringe on individual rights => 13th, 14th A (state action doctrine)ii. Infringe on federal Const power => McCulloch holding

b. This is always your starting place.c. The powers not granted to the national government in the Const are left to the States/the people. => Therefore, every exercise of national

power/authority must be linked to a constitutionally granted power. This scope was made rather broad by Marshall in McCulloch; give national government substantial discretion in the implementation of its granted powers. (tension between nationalism and states’ rights)

2. Historical Background: Response to the Articles of Confederation LINKS TO: Judicial Authority and National Power (*) (especially influence of Marshall); Necessary and Proper Clause (reaction); Commerce Clause (Historical and Modern) (reaction); Dormant Commerce Clause (*) (reaction); Tenth Amendment (limited government)

a. Constitution: still creating a limited government (10th Amendment), but authorizing powers to Congress (Article I), Executive (Article II), Judiciary (Article III). => see above

b. Articles: Very weak central government here. From the period of 1777-1787 (Constitution written), 1789 (ratified). A of C established Congress, but the powers of Congress were very weak. Each state had own tariffs and put up walls against other states. Each state had its own currency (because of this, some argue that the sole purpose of getting the Constitutional Convention together was for the Commerce Clause).

i. The Articles of Confederation Congress had the power to: declare war, make treaties appoint ambassadors, piracy courts. But only could do treaties in times of peace, and could not make treaties when doing so would interfere with state power – ‘extraordinary limitation’

ii. No power to create currencyiii. A of C written in terms of the limits, not powers, of Congress

c. Need for National Power even after adoption of the Cont: states still didn’t like each other (were like separate countries before, amnosity, jealousy); weak federal government, weak national government.

i. Ex. Marshall in Marbury, McCulloch and Gibbons. Marshall was not really worried about the national bank, worried about national power -- in Marbury (judicial review), McCulloch (means/ends argument, N+P Clause, for national power) and Gibbons (Commerce Clause: can regulate intra if affects inter), he shows this concern and takes (a lot of!) action.

3. Does this exercise of the Supreme Court’s authority get at the purposes of the Constitution as creating a limited government? LINKS TO: Commerce Clause (Historical and Modern) (especially in pre-1937 limits); Tenth Amendment; Individual Rights

a. Reaction against monarchy they had just experiencedb. Unique American belief in autonomy that permeates the Const also

4. Goals of the Constitution – how does this exercise of Court’s power meet/not meet the goals of the Constitution? a. Stability: prescribed limitations on the federal governmentb. WRITTENc. Goals listed in the preambled. Separation of Power => checks and balances on government between the three branches and different powers set out

in Articles I, II and III => purpose of limited government. e. Separation of Power => Federalism: vertical separation between states and federal government => again, purpose of

limited government

1. See below, State Action Doctrine @ Individual Rights Section 2. If YES => Const. inquiry.3. If NO => Probably not likely that the Const. is implicated at all.

a. Article I: limits on Congress

Threshold 1: State Action? Is the action in question one taken by government, whether federal, state or local (or by someone action in cooperation with government to meet state action doctrine?)

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b. Article II: limits on Executivec. Article III: limits on Judiciary (federal courts)d. Amendments: mostly limits on states

i. Exceptions: 13th Amendment does not have “state action” requirement.ii. But, subject to the state action doctrine: FOURTEENTH AMENDMENT!

I. INTRODUCTION: ARTICLE III, POWER OF THE COURT – JUDICIAL REVIEW AND JUDICIAL SUPREMACY

1. Power of the Court 1: The Power of Judicial Reviewa. Definition: Judicial review is the power of the Supreme Court to INVALIDATE LAWS and is what renders the

Constitution enforceable as law. => comes from Marbury v. Madison i. Because we are in a limited government, every exercise of national power/authority must be linked to a

constitutionally granted power. => therefore, we’ve got a constitutional question when there’s an exercise of government power and we’re concerned that it’s too much/that doesn’t have the authority.

ii. There is no term “judicial review” in the Constitution, came from Marbury v. Madison holdingiii. Judicial review is what renders Const enforceable as law: because reviewing other laws—the power to

invalidate laws—for not holding up to the Constitution. b. **What is the SOURCE of judicial review?

i. Textual1. Article III s. 2: Judicial power extends to cases “arising under the Const”2. Art VI Supremacy Clause => the Const is the supreme law of the land, every justice takes an oath

(Art III) to uphold the Const. ii. Structural => The judiciary’s history is deciding conflicts of law; least dangerous branch; Exec and

judicial branches are too political to be trusted to do it. iii. Historical => Const designed to trump lower laws (Supremacy Clause).

1. However, this doesn’t have to mean that that Court is the sole interpreter – legislature could do judicial review as well.

2. But there is also some indication (Federalist 78) that Founders indicated for judicial review as well.

c. Why Judicial Reviewi. Courts are the “least dangerous branch” because can’t enforce its own decisions (need Executive and

Legislative to do this, built-in check on power), low threat level. (least dangerous branch = also argument for broad powers of the Court in general)

ii. Enforcing limits: holding legislature and executives accountable. (limited government, checks + balances)a. Independent branch: not accountable to citizens for public support, votes, accountable

only to themselves – more principled.b. Enforcing the Const, the “will of the people.”c. Protect minority interests/individual rights.

d. Arguments Against Judicial Reviewi. There are other ways to enforce the Const.

1. Vote the bums out – ex. 1800 revolution. a. Then, who you vote influences the judicial appointment process.b. Ex. Angry right-wingers since Roe v. Wade – putting in election platform that will put

in anti-choice judges to reverse.c. Voting was the most important way the Framers thought the public could enforce the

Const. 2. President’s veto3. Senators/legislators can vote against a law that they think is unconstitional.4. The public’s role (in addition to voting the bums out):

a. Impeach members of the Court; b. Public can amend Const

Threshold 2. Can the Court hear this case? (a) Does the Court have the authority to enforce the Const. based on Judicial Review & Supremacy? (yes, Const creates ltd gov’t, power must be enumerated in Const; McCulloch, DCC, A’s create limits on states) (b) Does it meet standing and PQ requirements to bring the case to federal court?

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c. Popular opposition can cause individual justices to change their views. d. Members of Court can be impeached if view strongly at odds w/popular thinking;

Congress Ex. Justice Burger in Roe vs. in Thornburgh.ii. Concerns about power -- judicial review is still a lot of power. Courts can get it wrong too; there are many

ways to interpret the Const (as we have seen through const law).1. Not that politically removed.2. Not that representative (for most of history, not very repr. at all).3. We the people is itself flawed, wasn’t all of the people.

iii. Lazy populace, lazy officials – everyone thinks that the Court will just handle it.

Types of Judicial Reviewa. Over other branches of government => Marbury v. Madison

i. Marbury v. Madison established that the Court has the power to invalidate (or say the law is OK by Const, validate) laws made by the Executive and Legislative branches, as well as states.

ii. Background: Marbury (plantiff), who was appointed justice to the peace. Defendant = Madison, secretary of state. Marbury wanted Madison to honor/deliver his commission. The statute by Congress authorizing the federal judiciary had its own remedy—that SCOTUS would get original jxn over his mandamus action and could hear his case.

1. Led to two issues: (1) power of Congress to extend the jurisdiction of the Supreme Court and (2) Power of the Court to invalidate something Congress did as unconstitutional.

iii. Part I: Congress can’t extend the jurisdiction of the Supreme Court. 2. Article III s. 2 provides for Appellate and Original Jurisdiction. 3. This not within the bounds of Original so it is Appellate. Original is strictly limited to

ambassadors, public ministers, or a state is a party. 4. Can’t blur, because otherwise would not have written them as separate (textual argument).

iv. Part II of the opinion: Judicial Review (Justification). --Basically: the law is unconstitutional. Now what? => Court establishes judicial review. The Court has the authority to review acts of Congress and determine whether or not they are Constitutional, which is what it was doing here by saying §13 was unconst. --Justification: how does what the Court is doing in ____ related to the justification for judicial review/Supreme Court’s ability to rule that ____ is unconstitutional? 1. Limited government: **Const creates limited federal government (explicitly in Article I s. 9).

This limited government meaningless if Congress can overstep the Const bounds.a. Tripartite structure of government; Not giving const power would give the leg

omnipotence2. The nature of written constitutions (was perhaps the only one in 1787).

b. Court’s ability to interpret the Const and enforce it is based on the nature of written constitution.

c. Designed to be permanentd. Not likely to be amended => so need Court to enforce it and interpret it and strike down

actions of other branches if they are against the Const.e. Written => must be enforceable, quotes Federalist Paper #73 (Hamilton) – p13

3. Textual Argument => not conclusive, thoughf. Article III, Supremacy Clause: Lists the Const firstg. Article VI: Judges take oath.h. Textual examples.

i. Ex post facto laws.ii. Legislature could make laws directly against the Const.

i. Article III s. 2 gives jxn for cases “arising under” Const, some will be under Const, they should be able to analyze and apply the Const

b. Over state action – McCulloch v. Maryland (power of Congress to establish National Bank, MD was taxing bank)i. Case was the const authorization of national power.

ii. Does MD have the power to tax the bank? NO. Can strike down state action (Congress has the power to make the bank, and Court has the power to strike down this state action as against valid exercise of Congress’s power.) => link to Dormant Commerce Clause.

iii. Holding 1: Congress has the power to charter a national bank under the Const => broad power of Congress1. R1: Structural inference about Congress’s power

a. No specific exclusionb. 10th Amendment vs. Articles of Confederation and the lack of the word “expressly,”

contrast with historical background of A of C.

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c. Bank relates to other various power – commerce, taxing, armies/navy: the bank is related to achieving those powers.

d. Constitution = “popular sovereignty” – Const is for the people, people’s will can be expressed by federal government.

2. R2: Policy - Constitution as a broad outline (“it is a constitution we are expounding”); need for a functioning government

3. R3: Necessary and Proper Clause for Congress’s Actiona. Broad interpretation of “necessary”: “convenient, useful, essential” ex. Post officeb. Constitutional for Congress or the Executive Branch to choose the means that they see as

best suited to the ends – this is his view of N+P Clausec. Implications => Congress can choose the best means: they have Const power to decide

the means see most fit. Doesn’t mean have to. iv. Holding 2: Maryland does not have the power to tax the National Bank. State law cannot interfere with the

powers of national government for constitutional ends. 1. Holding: State law is invalid if it interfere with one of these means that either Congress or the

Executive has chosen (because then interfering with “supreme” federal authority). Here, this means that the MD law is unconstitutional. This is again an application of judicial review, this time invalidating the Maryland law for interfering with federal/Constitutional means.

a. => but note limits: this was about state action, Jackson was NOT going against this decision when he vetoed Second Bank because then it was Executive going against.

2. Rationale for judicial review over state action: a. Arguments for judicial reviewb. Supremacy Clause (by implication here: the power to tax is the power to kill. Federal

supremacy implies that state cannot kill federal institution; States are not supreme under the Const).

c. Specific to this case: no taxation without representation

c. Of state court decisions i. Judicial review also applies to state court decisions – even if based on a state constitution by a state court

if the state court has attempted through state law to take away rights protected by the U.S. Consd. Of executive conduct

a. Marbury also applies to reviewing the legality of Executive conduct.i. Balance of branches

ii. Can review Executive conductiii. See => Youngstown Test, Article II Tests

b. Court in Marbury also claimed the authority to review and determine the legality of executive comment in discussion of difference between politically discretionary duties and nondiscretionary duties.

c. Here talking about Jefferson’s appointee (Madison), secretary of state, but can review Madison’s actions for being legal or illegal (based on the law that Congress had passed – here, found that the executive branch had acted illegally because did not follow §13).

2. Power of the Court 2: Judicial Supremacy a. Definition

i. Legislative and Executive Branches bound by SCOTUS decisions.1. Court’s decisions bind all branches/public are bound by interpretations: Court’s

interpretations of the Constitution = BINDING interpretations on public, all branches, all courts.2. Ex. Even if Obama disagrees with Citizens United, cannot be a law that that would direct go

against Citizens United ruling. so urges Congress to pass a law that doe something to limit that holding in accordance with Citizens United.

ii. There has been a general acceptance of judicial supremacy by public (that SCOTUS has exclusive interpretation of the Const).

iii. Read into Marbury v. Madison/Const but not explicitly stated. b. Cooper v. Arkansas: Arkansas governor wanted to defy Brown. (Arkansas DC implemented Brown. Gov. Faubus

said NO to Brown desegregation, got the National Guard involved to make the school off limits to black students. DC: issued injunction, black students to the school. But, violence/resistance. School board: sought to postpone deseg. program. => Court held he had to follow Brown and desegregate.

i. Holding: Court’s interpretations of the Const are akin to the Const. Court equated its interpretations of the Const with the Const. Binding on all fed/state courts when deciding questions of constitutional law. In this case: Brown is the law of the LAND, not just the parties to the case (Topeka)

c. Justification for Judicial Supremacy

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i. Supremacy Clause: Article VI, Cl. 3: The oath to support the Const that legislature takesii. Oath: Other branches take oath to support the SCOTUS decisions, in addition to the text of the Const.

iii. Uniformity in interpretations of the laws and the Constitution. iv. Finality – know what means to an extent when the Court comes down with a holding and that it will apply

to all courts.v. Independent judiciary can better protect individual/minority rights; not swayed by needed to appeal to the

majority.vi. Most of the benefits of judicial review also apply – least harmful branch, limited government, checks and

balances. d. Arguments Against Judicial Supremacy

i. Departmentalism: Each branch/official swears to an oath to support Const as it/he understands it and they each act on that oath to how they understand the Constitution. Each branch should enforce for themselves.

1. Jackson: Wants to veto Second Bank. Says that presidential oath is equal to the power to interpret the Const. But in his case veto did not actually defy a Supreme Court holding of McCulloch (McCulloch was that state cannot infringe on N+P means and ends, but federal government can).

2. Lincoln: Dred Scott is a poor decision—if settled precedent, then it would get his support, but here, he does not think that Dred Scott is settled precedent (it is contrary to history, it has partisan bias, part of presidential power is the power to interpret the Const (cites Jackson)).

3. Extreme View: Defy S Ct. holdings. Ex. Newt Gingrich in national security cases (to defy habeus corpus provisions of Const and holdings), citing Pres. Lincoln defying habeus corpus in Civil War.

ii. The Countermajoritarian Difficulty (also a concern for judicial review): argument that too much rests on an undemocratic elite group.

1. The argument: Justices are not elected so why should they get to override Congress which was actually elected by the people?

2. The “transfer” of powe to federal gov’t in the Const made 225 years ago.3. Arguments against the “counter-majoritarian” view

a. Const itself not majoritarian document, takes away rights from the majority, protects individuals

b. Need a check other branches.

II. BUT DOES THE COURT HAVE THE POWER TO HEAR THE CASE? => LIMITS ON THE COURT’S POWER: JUSTIACIABILITY

Court has a lot of power. But this power isn’t unlimited. 1. Article III => “Case or Controversy” Requirement

a. No hypotheticals b. No advisory opinions => need for a focused controversy and judicial restrain.

i. From the “Case or Controversy” requirement in Article III. ii. Courts decide CASES – they won’t decide issues unless presented in a specific factual context

w/adversarial parties. Unwilling to adjudicate on Const issues unless strictly necessary. 2. Article III => Standing: is this the proper plaintiff to bring this case? Does the plaintiff has a sufficient stake in the

controversy? Who can bring a lawsuit? a. INJURY IN FACT -- invasion of a legally protected interest and must be

i. concrete and particularized1. No generalized, see Lujan, was not particularized enough was general claim for Executive to

enforce a law, and the injury in fact was not particular to them. ii. actual or imminent

iii. NO abstract or generalized claims! => cannot be generalized political grievance; no “Third Party” claims – cannot bring a suit on behalf of someone else

1. Lujan 2. Exception: Citizen-suits that meet requirements by Congress =>

b. CAUSATION-- injury has to be fairly traceable to the conduct of the D and not the result of the indpent actions of a third party

i. Mass. v. EPA: very important case for environmental law and standing. 1. “Incremental benefits” of EPA regulations satisfy the cusaution requirement, even if other

countries contribute to the problem as well.2. Looser standard for causation than Lujan.

c. REDRESSABILITY: court has to be able to actually help you. Must be likely that the injury will be able to be ameliorated by a favorable decision.

d. Purposes of Standing Doctrine (limits)i. Protect the Court

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ii. Prevent judicial abuse of poweriii. Have the Court do a good job.

3. Political Question Doctrine a. NOT that it’s a case involving politics – politics are okay – but that it’s a case in which the blend of factors suggests

that the fed courts should not be getting involved with this.

WHAT IS CONGRESS’S TOOLBOX? In the Article I powers of Congress toolbox

1. Commerce Clause!!!2. Dormant Commerce Clause: power to strike down state legislation as hampering the CC goals3. Necessary and Proper Clause (for CC, for general)—The Sweeping Clause. N+P is the smoking gun for Article I

legislative powers, the best tool in their toolbox, especially b/c under this whatever means that Congress sees fit within their discretion.

4. Spending Power5. War Power6. Treaty Powers

Limits on the toolbox (!!!)1. Commerce Clause before 1937, many limits2. Federalism and the 10th A Limits on CC

a. Anti-commandeering3. Other parts of Const (the arg for 21st A) – limits on CC, limits on Spending4. BoR limits on Treaty, War Powers (…and all)5. Spending Clause Test 6. Over everything: judicial review

A. Necessary + Proper Clause -- McCulloch v. Maryland, Comstock

1. Two Step Test (McCulloch)(1) Are the means reasonably calculated?(2) To support an enumerated power as the ends?

2. Have seen recent expansion of N+P clause in modern cases => Comstock a. Facts: Federal civil-commitment statute authorized DOJ to detain a mentally ill, sexually dangerous federal

prisoner beyond the date the prisoner would otherwise be released. (detaining mentally ill and sexually dangerous federal prisoner)

b. Holding: Yes, Congress has the power under the N+P to enact the statute.c. Relied on Necessary and Proper Clause Rationale: N+P Clause gives Congress broad authority to enact

federal legislation. Their application of the test – i. Are the ENDS enumerated?

1. No specific enumeration about creation of federal crimes beyond counterfeit, treason, piracy [which the dissent jumps on], but finds the source of this enumerated power in “broad authority to create such crimes” establishing a prison system as enumerated power-- the enumerated ends.

a. enforcing civil rightsb. regulate commerce c. general welfared. post offices

ii. Then, are the MEANS rationally related to this end? ***the issue here***1. Identifies five factors that give Congress the authority—for future cases, could phrase as does

the statute include the… a. N+P clause gives Congress the power to regulate banks, immigration - enumerated

powers in Article I §8b. N+P clause gives Congress the power to Power to arrest c. N+P clause gives Congress the power to put people in prison– N+Pd. N+P clause gives Congress the power to keep the prison well-kept– N+P

I. Does this fall within an enumerated power? => Article I Powers of Congress Does Congress have the power? (1) N+P, (2) Commerce Clause**, (3) DCC to limit states (4) War, (5) Spending, (6) Treaty

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e. N+P clause gives Congress the power to release prisoners and put on parole–f. And here, they determine that N+P gives Congress the power to detain if threat to

society b/c sexual predator? – N+P is the holding d. Concur: Kennedye. Dissent: Thomas -- agrees that N+P gives Congress the power to regulate #1-5, but does not think that there is

authority for 6.i. Congress cannot protect society from every bad act

ii. Can’t just protect for “any old thing” – federal/state divide iii. You are putting people away for what they might do; that they might violate federal law.

B. Commerce Clause – does Congress have the power to do this based on the Commerce Clause?1. The enumerated power: “To regulate commerce with foreign nations, and among the several states, and with Indian

tribes.” Article I, s. 8. => now what have we done with that? that’s this section. 2. Generally

a. Purposes: Created to eliminate trade wars between the states (during Article, states were creating large trade barriers against each other), reaction from Articles government, strengthen national economy, facilitate trade.

b. Because was reaction from Articles, this view suggests that it was meant to be a “negative trump” on states => but Const. actually describes a general power over commerce among states (see Ogden).

c. In the early days, Court struggled with bunch of different tests to define commerce (manufacture vs. trade, direct vs. indirect, ‘stream of commerce,’), but the after 1937 became much broader – may be changing from Lopez, but Raich counters.

d. This is the broadest source of Congress’s power to enact legislation. The Commerce Clause is the primary tool used by Congress to regulate domestic affairs.

3. Words of the clausea. COMMERCE => Any commercial exchange of goods and services, including the marketing, purchase and

transportation of those goods.i. Historical cases: sale of goods ONLY, not including the manufacture or production of goods (=> but

changed with the “substantially affects commerce” test in 1937). ii. Today: broad definition, any commercial exchanges => but must meet Lopez Test.

b. AMONG THE STATESi. Was at issue in Gibbons - can be intra if affects commerce.

c. REGULATE i. Congress can pass laws because of this, becomes an enumerated exercise of Congress’s power.

(A) Historical Background of the Commerce Clause

Are we before 1937? => Pre-1937 Tests, four different categories for action and rules about what Congress’s power was.

1) Substantial Effects Test: Does ___ have a substantial effect on commerce? => YES Congress has the power. (Gibbons, Shreveport Rate Cases, NLRB (indirect/direct effects, SAC), Darby (Part II: SAC, explicitly citing McCulloch))

2) Indirect vs. Direct Test => Does act that Congress was regulating had only an indirect effect on commerce? => NO Congress does not have the power. (EC Knight, Hammer v. Dagenhart (because motive mattered, was just a labor law, labor = indirect), Schechter (labor = indirect), RRR v. Alton (labor = indirect), Carter (labor/manufacture = indirect). (explicitly repudiated in NLRB, 1937)

3) Stream of Commerce Test => If in the stream of commerce, then YES (Swift) // but if before or after the stream of commerce => NO (no in EC Knight, Schechter).

4) Motive Matters => If would otherwise be okay by the CC but we can see that only done to satisfy some social motive, then NO (explicitly repudiated in Darby, 1941)

a. Development of Cases

ii. Gibbons v. Odgen - State says that one party had power to regulate the New York waterways, other party had right to operate steamboat in waterways from Congress. Did Congress have the power to regulate the NY waterways—within New York state, intrastate

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1. Holding: YES. Even though NY waterways are intrastate, they are (1) Instrumentalities and (2) Congress gets to decide on the means of enforcing its enumerated ends (N+P) => because affects interstate commerce, regulating NY’s waterways is within the discretion of Congress => have the power.

a. Instrumentalities: Commerce power includes navigation. (see Modern Lopez Test.) i. Rationale: Need for broad national/federal government power (Marshall opinion); it has been done:

Commerce over navigation has been exercised with full consent; everyone understands “commerce” to include navigation.

b. N+P Clause gives Congress wide discretion. Congress has the power/authority over commerce that affects more than one state – affects being the important word here. This means that Congress can regulate intrastate activities that have interstate effects, if it is N+P to do so to exercise Congress’s CC power => one of the means that is within Congress’s discretion.

i. Because intrastate activity can affect interstate activity, regulating intra is necessary and proper means for Congress to exercise its (enumerated) power of regulate interstate commerce.

c. “Among” the state can meet “intra” if also has effect on interstate activity => predecessor of SAC Test. (Marshall reading “among” to mean “intermingled with”)

d. Sole restraint is the people (who can vote the bums out)/discretion of Congress.2. One limit: Congress cannot regulate purely intra state activities.

iii. EC Knight (1895): Monopoly on sugar manufacture; violated the Sherman Anti-Trust Act (1887) that Congress had passed pursuant to CC powers. But the whole sugar manufacturing monopoly in PA, although they shipped out sugar to the whole country. Does Congress have the power to regulate the sugar manufacturing monopoly even though it’s all in PA (and is sugar manufacturing?).

1. Holding: No => Congress does not have the power. 2. Indirect/Direct Test – the monopoly over sugar manufacturing was local and only had an indirect effect on commerce,

manufacturing =/= commerce, therefore not directly affecting interest commerce and no a. Labor and manufacture only exert indirect effect to commerce.b. Manufacture is not the same as commerce.

3. Application: Manufacture of sugar is not commerce of sugar, and only exerts an indirect effect on commerce. Also, all manufacture in PA. PA manufacturing => not directly affecting commerce => Congress does not have the power. Here sold the sugar across the whole country (the commerce of the sugar), but the manufacturing was not directly related to this.

4. Note: when Congress passed Sherman Act not clear whether Congress had power over state enterprises that shipped out of state; and this was the decision – to limit.

iv. Swift (1905) – Stream of commerce, meatpacking, cows going through Chicago price-fixing meat-packers en route while n stream of commerce between states. Still,: all of the price-fixing was going on within the limits of Chicago, NOT interstate.

1. Another Sherman Act case, like EC Knight (here: conspiracy in selling livestock) 2. Does Congress have the power to regulate the price-fixing of meat-packers within Chicago who are part of shipping

stream-of-commerce operation, when all price-fixing w/in a single state? YES. => New test, stream of commerce test.3. R1: ore things happening in PA for sugars vs. the cows in IL – but this was an extension of the CC, still not final product of

cow being shipped4. R2: Practicality: practical aspect of commerce, not technical legal one (on boundaries) – but that these are in reality part of

interstate commerce (not just local commerce) so treat them as such, not just trading w/in New Mexico but the reason being traded is so Arizona also.

v. Shreveport Rate Cases (1914) [substantial effects]1. 40 miles between Marshall to Shreveport (LA) was 56 cents, but 150 miles between Dallas to Marshall was only 34 cents.

This was because Texas Rail Commission wanted commerce to stay within Texas. A federal statute had authorized the Interstate Commerce Commission to prohibit a RR from charger higher rates for interstate fares. The Texas Rail was directly in violation of this, Texas Rail sues.

2. Issue: Does Congress (through ICC) have the power to regulate the price discrimination by Texas RR Commission? YES – even though the rates were only within Texas.

3. YES, Congress has the power to regulate, because the intrastate rates have a “close and substantial effect” to interstate commerce. Returning to Gibbons’ more expansive view of the federal commerce power; Court affirmed the statute.

4. The court changed the test: The new test is “close and substantial effect” on commerce; goes back to Gibbons, where upheld that it was Const. valid to regulate the intrastate steamship rates of NY waterway (INTRA) because effects were interstate..

5. Also looked more interstate to the SCOTUS; using the same cars. vi. Hammer v. Dagenhart (1918)

1. Father suing re: Child Labor Act, in which Congress prohibited the shipment of goods made with child labor) within interstate commerce. Does Congress have the power to regulate goods produced through child labor with the Child Labor Act?

2. Holding: NO. Law was held unconst for overstepping the power of the CC. 3. One of the most restrictive cases for the Commerce Clause. Why? Because the law was regulating the cars themselves.

a. But, because the products themselves were not dangerous, Court said that this law was just a pretext for labor law (which it was) => disqualified b/c Motive Matters => now it’s only labor => it was a labor law test 2 (Indirect/Direct Effects).

4. The motive matters test: If a law is just a pretext for getting at regulating LABOR/MANUFACTURING, will not look at the “loophole” that he court was trying to find, but instead will treat the law about what it was the pretext for (here: child labor).

5. Justice Holmes Dissent: (majority of Darby) => Statute is about commerce and CARRIAGE, clearly within scope of Commerce Clause.

vii. Schechter (sick chickens) (1935). Schechter Poultry Co. was slaughterhouse of chickens in Brooklyn, violated the “New York Chicken Statute” of NIRA (passed by Congress) - had minimum wages, max. hours, and regulations on the fitness of the chickens. Schechter Poultry GOT their chickens, at least some of them, from PA. But, they SOLD all of the chickens within NY. Only sold the chicken to local retailers.

1. Issue: Does Congress have the power to pass the National Industrial Recovery Act of 1933 and, thru codes created by trade organizations, regulate commerce in which the chickens came from one state but were only sold intra?

2. Holding: NO, Congress cannot regulate commerce via CC with codes for local.

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a. Indirect/Direct Effects Test => not regulating commerce, was regulating labor; is a sep. “enclave” from commerce. No authority.

b. Not in the stream of commerce: Any interstate “commerce” bit comes after manufacture here the interstate part (where they got the chickens from) was interstate but where shipped the chickens to was not..

c.viii. RRR V. Alton (1935) RR Retirement Board establishing a compulsory pension plan for all carriers subject to interstate commerce act.

Does Congress have the authority thru RR Retirement Board to establish pension plan? => NO. 1. Congress can’t establish pension plan; in the line of other ruing that Congress can’t regulate labor. 2. Used Indirect vs. Direct test again (test 2).3. The law was about the pension of the RR workers regulating labor which is separate from commerce and only exerts

an indirect effect on commerce. Not w/in Congress’s authority.4. No dice also for “instrumentalities” here.

ix. Carter (1936) [coal] Congress’s power to make the Bitumous Coal Mining Act (mini-version of NIRA, imposed rules coal mine labor: minimum wages, max. hours).

1. Court said manufacture/production are local, even if mass scale, still NOT interstate commerce. Similar to: Hammer (can’t regulate goods of the children to get @ curbing child labor), Schechter (can’t attempt to use the chickens over state lines to regulating labor).

2. R1: Indirect/Direct. Carter’s law was just like NIRA, but more specific. Might have, however, had a better argument with the Coal Mining Act – Coal into RR’s (instrumentalities), heat across all states => but still held was just about manufacture and therefore indirect effect on commerce; not CC power.

3. R2: Magnitude does not make this interstate commerce.i. Just b/c it has indirect effects on other states and other parts of commerce & multiply this times a lot

b/c big industry, doesn’t mean that has DIRECT effects – Manner, not magnitude..b. Response to holdings: The Court-Packing Plan

x. Plan was that for every judge over 70 on the Court, period of 6 months where they can decide whether or not retire. If they stay on the court, new appointee would join them; up to total 15 people could be on the Court. – the Court was killing the New Deal by saying Congress didn’t have the power to regulate commerce here.

xi. Plan had public support, was likely Const. (Const only puts down minimum of one “Chief Justice”); Congress has Const Article I clause 18 power to decide the # of SCOTUS justices and make all laws necessary and proper for power of preserving the Const, including S. Court and appointing/controlling the number of justices.

xii. Plan had public support.

(B) Modern Commerce Clause

>> Lopez Test xiii. Which part of the test are you in?

(a) Channels: highways, waterways, airways (Ogden) – methods of interstate commerce, also Dole v. South Dakota, Iowa I-80 Case

(b) Instrumentalities: boats, cars, planes, trains (Shreveport Rate) – methods of interstate commerce(c) Substantial effects on commerce (SAC)

xiv. If you are in SAC => look for…1. Jurisdictional element – are there those “magic words” that make whatever you are doing specifically

apply for IS commerce? 2. Economic OR non-economic activity?

a. -Substitution?b. NOT doing something as the economic activity? (Raich, how you could read Wickard)

3. Whether comprehensive scheme – what we learned from Raich – because then can use N+P Test (the particular act might be N+P to the whole comprehensive scheme). in healthcare, this is so can pay for the Act.

4. Aggregation => Apply rational basis test a. Definitely can aggregate if economicb. Can aggregate if non-economic under Raichc. Necessary + Proper => Rational Basis Test Applied

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Congress must have a rational basis for belief that regulation will achive goal. The Court often defers to Congressional findings (or: Katzenbach, Scalia argument in Raich – no findings needed dat all) unless they are irrational.

5. Is this a RED FLAG area for federal control? Areas of traditional state control – be on alert if get one of these: criminal law, family law, education

>> Golden Period of Commerce Clause Cases: Reliance on SAC Test 1. Used first in Shreveport Rate Cases (see above)

a. What was SAC: The rate of trains from Marshall to Dallas (intra) vs. the rates of interstate trains, the higher interstate rates had substantial effect on interstate commerce.

2. Next, NLRB v. Jones & Laughlin - power of the “Substantial Effects Test” a. Large steel company with huge, integrated company. NLRB found them for discriminatory firing of union

members. All the plants in the case—where the discrim. firings had happened—were within PA. No interstate arg for interstate labor here (and still not commerce, it would have been like the chickens probably?).

b. Holding: The NLRB [Congress] has the power to regulate the discriminatory firing of union members, even though was clearly regulating labor => changes the test.

c. Rationale: Used SAC, and distinguished from Indirect vs. Direct precedents that were indirect because of the degree - -but basically abandoning Indirect vs. Direct.

1. Test #1: Substantial Effects – “familiar notion” that if have these firings, will cause havoc/chaos, will disrupt production of goods… will have a substantial effect on interstate commerce.

2. Test #2: Indirect vs. Direct Effects Test - Talk about a question of DEGREE, say the degree here pushes it into “Substantial Effects,” argue that Carter and Schechter do not control.

3. ***Then, US v. Darby – YES (and this time, not a 5-4 split). (1941)a. Case lays out the modern framework for CC. Reformulated CC to advance the goals of a national economy. b. At issue: Fair Labor Standards Act of 1938, two key parts: prohibited the shipment of goods not produced

according to minimum wage and maximum hours AND (2) prohibited the employment of workers other than according to mi wage/max hours in the production of goods intended to be shipped in interstate commerce.

c. Part I of the opinion: GOODS – Goods can be regulated even though motive was for workers’ rights. Expressly overruled the part of Hammer that says motive is determinative/motive matters, and says that labor and manufacture are direct effects. (Motive Matters Test)

d. Part II of the opinion: WORKERS - Effects Test, in NLRB, because no longer saying that LABOR and MANUFACTURE laws are indirect but DIRECT, basically diluting the test so much not really a test anymore. (Indirect/Direct Test)

1. How does Congress have this power? Enumerated power? 1. Commerce Clause => Relies on the commerce power and the SAC test, unfair competition

will lead to the destruction of local businesses. 2. The means Congress chose were necessary and proper.

a. McCulloch: suggests that the Court hesitates to second guess Congress when they are acting within their enumerated powers.

4. Wickard (SAC with aggregation- up until this point, the action that was being regulated in the case alone was theorized by the court as itself having its own substantial effect no Commerce – here we add aggregation)

a. Stands for the substantial effects test with the aggregation principle. Congress can regulate any activity, if the combination of similar effects (or hypothetical effects) has a “substantial effect” on commerce.

b. Facts: Darby was farmer, grew wheat for cows/home, was fined $117 by Sec. of Ag for violating the Agr. Adjustment Act.

c. Does Congress have the authority to regulate the growing of wheat on own home farm and not for resale (to feed one’s cows, to feed one’s family) through the AAA under the Commerce Clause/Const?

d. H1: Adds “Aggregation Principle” to SAC Test. Fillburn by himself alone growing homegrown wheat does not have direct effect, but farmers everywhere doing this would have direct effect. Congress had the power, because although the wheat was trivial in itself, but in aggregate, had a direct effect.

1. RATIONALE for the Aggregation Test: (N+P – yes) => political rather than judicial restraints (getting out of the business); while individual acts are trivial, taken together have an effect.

1. => Modern Approach: Only “economic” activities can be aggregated; tug of war over this.

e. H2: Substitution counts are action => action can be aggregated.1. RATIONALE for substitution => “the economics of the wheat industry” – surpluses and the need to

manage the surpluses. => negation is an action here, the fact that he’s keeping it for himself and just one guy, trivial amount means that he was not buying it from someone else.

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2. Although his individual act is trivial, taken with everybody as a whole, it substantially affects commerce. Also uses the argument that if did NOT regulate this, there WOULD ALSO be something SAC.

f. H3: Through the aggregation test, eliminates the direct/indirect effects test, because with aggregation this is not longer any distinction between what has a direct effect by itself and what has an indirect effect.

1. RATIONALE => the interconnectedness of the national econmy, everything, even that of a small private actor can be substantially affecting interstate commerce.

5. Civil Rights Casesa. Heart of Atlanta: Title II of the Civil Rights Act of 1964 made it unlawful for “any in, hotel, motel” to

discriminate based on race, color, religion or national origin1. Holding: Civil Rights Act provided that it was “transient guests” out of state travellers, and the

hotel did have a lot of tourism here. Congress could have reasonably concluded (rational basis to determine SAC even without N+P clause) that racial discrimination by motels serving interstate travellers would substantially affect interstate commerce.

2. Direct effect, did not even need to look at the aggregation principle here 3. Discrimination against AA’s directly affects tourism by discouraging people from travelling, and

therefore interstate commerce, this is within Congress’s power to enforce CC, Congress could have reasonably concluded that this would SAC.

b. US v. Katzenbach: Ollie’s BBQ, 11 blocks from the interstate, seated 220. Civil Rights Act of 1964. 1. Holding: The Commerce Clause, this time using the N+P Clause – not something indirect to interstate

commerce. Congress could have reasonably concluded that racial discrimination by Ollie’s BBQ, in the aggregate, would substantially affect interstate commerce.

2. Rationale: aggregation test and used the N+P Clause – whenever it’s not SAC interstate commerce itself, you go to the N+P because then you’re regulating the means to the end and it’s constitutional to regulate the ends – McCulloch.

1. Aggregation test is a derivative of the N+P 3. Applied Rational Basis Test => Congress did not have to show their exact findings, but the Court

instead deferred to Congress’s discretion here (reasonably tailored to enumerated end, N+P).

>> Modern CC Jurisprudence and Debates

1. Lopez (1995) - Lopez brings gun to school, gets prosecuted under the Gun-Free School Zones Act of 1990. a. Basic question: Does Congress have the authority to regulate possession of guns in public schools under the

Commerce Clause/Const? => SAC Test (not instrumentality, not channel) => Can the Court find that Congress could have reasonably concluded that regulating the possession of guns in school zones would substantially affect** interstate commerce?

b. Holding: NO, Congress does not have that power (first time in 60 years).i. Set up the three-part Lopez Test => still the way we do Commerce Clause analysis: (a) Channels, (b)

Instrumentalities, (c) SAC Test. ii. Introduced the economic vs. non-economic distinction

1. “Commerce” in the CC “economic activity” only. 2. Application of this new test: Court says that Wickard was economic activity.

a. Home-grown was “economic” here, so was substation theory. => even if you don’t see growing wheat as an economic activity, still part of economic scheme.

b. Looking at Wickard, does look closer – he was a dairy farmer, he was selling the milk from the cows, and the wheat was being used to feed the cows.

iii. Refined what the Court uses to determine whether something substantially affects commerce1. Congressional findings? => Not necessary, not sufficient, but would have helped prove that

rational basis for thinking that the guns had SAC. 2. Jurisdictional elements? => AKA requiring that the law applies only to things in IS

commerce, not just because some of the guns IS commerce maybe not specifically this one this is what Congress ends up doing.

c. Rationale: Federalism, don’t want national police poweri. Also, reading Wickard as “economic” and meeting their test where you can do aggregation is

“economic,” contrast it with this; here NOT part of any larger economic scheme – and cannot be upheld with cases in which are aggregate AND commercial – which saying that Wickard was, but this is not.

d. Thomas (Concurrence)i. Wants no SAC Test, wants to go back to 1936.

ii. Because of how have interpreted CC, Article I, s. 8 is now irrelevant.

Remember!

-What was Congress regulating? => Racial discrimination

-Did what they were regulating SAC? => Here, yes.

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e. NOTE: Arguments that the Court rejected: a. Costs of violent crime are substantial. b. Through insurance, those costs are spread to the community – community’s buying

power goes downc. Violent crime reduces the willingness of individuals to travel to areas that are perceived

to be unsafed. Best argument: Handicapped educational process less productive citizenry {or that it

affects their ability to be productive in Congress} affects commerce

2. Don’t want national police power - strong interest against this by the Court’s majority here. a. Federalism interests; no question the policy is good, but who should be doing it

ii. Dissents1. Breyer: Agrees w/Thomas that CC is either/or, have to uphold the CC SAC test on everything

(this included say the dissent), or on nothing -- Legal uncertainty is bad; public policy of wanting to be able to have Congress enact criminal laws.

a. Should replace “substantial” with “significant.” But either way, this works under S(ubstantail) Affects Commerce Test

b. Uses the N+P test: not directly, but one removed. Need to look @ practical effects and how implicate commerce

c. Also uses RB Test – whether “could rationally conclude that schools fall on the commercial side of the line [of commercial vs. noncommercial]” not whether there was in fact a substantial effect on commerce, yes.

d. Guns: bad effect on education communities/businesses don’t get advantage; students get worse jobs. Both are effects on commerce.

2. Souter: We need to exercise restrain in judicial review. Show some respect for Congress. Congress should be the ones exercising discretion on CC issues, not us – “leave it to the political process” – akin to Marshall in Ogden and ____________.

3. Stevens: Guns = articles of commerce and articles that can be used to restrain commerce; possession of guns has direct and indirect consequences of commercial activity, guns are in schools more now, therefore this is OK to be regulated by Congress with CC.

iii. The New Gun-Free School Zone Bill1. The bill was edited “transfer or posses.”2. Also, guns are rarely homemade and most guns are made in New England states, a few small ones,

this was in Texas, would have been fine w/the new bill also.f. Morrison – Const challenge to Violence Against Women Act, Congress provided a federal civil remedy for victims

of gender-motiated violence. Did Congress have an enumerated power to pass this law? => NO.i. Holding: Law is outside the Commerce Power, Congress can’t broadly regulate violence against

women.ii. Similar argument as Lopez:

1. There was no jurisdictional element => would have needed to have “women that pass through borders of states” or something

2. Uses economic/commercial as THRESHOLD for aggregation => doesn’t matter here that Congress had lots of findings about the prevalence about violence against women and that this was a huge issue in the aggregate because applied threshold.

g. Effect of Morrison and Lopez => The New Substantial Effects Testi. The activity is “economic” and Congress has a rational basis for concluding that the activity, in the

aggregate, substantially affects interstate commerce (Lopez, Morrison); ORii. The activity is part of a local, non-commercial economic activities, and Congress has a rational basis for

concluding that regulation is necessary to effectively regulate an interstate commercial market as part of a larger scheme.

h. Raich – medical marijuana, legalized in CA, but conflicted with the Controlled Substances Act, which effectively nullified.

i. Does Congress have the power to nullify a state law legalizing medical marijuana?ii. Holding: Yes, Congress has the authority. Court equates the case to Wickard. => Within Congress’s power

to regulate medical marijuana even if for home use. 1. **Note that this a huge departure from how Justice Rehnquist in Lopez characterized

Wickard: said that Wickard was commercial, now Justice Stevens is saying that Wickard was NOT commercial, but that still allowed aggregation.

iii. RATIONALE: Substantially Affects Commerce1. Classes/Subclasses Argument (with N+P) => within larger scheme

A good question to ask: could states have done this on their own?

Becomes weaker fed gov’t case to regulate

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a. The overall regulation: CSA.b. Primary purpose of CSA is to control the supply and demand of controlled substance

in both lawful and unlawful drug markets; various level for a huge variety of substances (Tylenol thru heroine)

c. Similar they say to the way AAA with the supply and demand of wheat 2. Used Raich Substitution Argument

a. Effects of supply and demand on national marketb. As long as related to that larger scheme, refused to excise individual

components of the larger scheme.3. This is how they also distinguish Morrison and Lopez: those cases ONLY targeted local and

fell outside Congress’s commerce power in the entirety of the statute. This statute is for the most part about federal commerce power and does not interfere w/states, it is only in some contexts, like this one, that it interferes

a. Instrastate yes, but within a larger scheme of inter that IS valid use of Commerce Clause Power

b. It is necessary and proper to monitor homegrown weed in order to monitor drugs, which is CSA, which substantially affects commerce.

i. Weed seeps into black marketii. Hard to enforce the CSA b/c can’t tell the difference between national and CSA

c. Banning is a way to regulate. Congress can regulate goods by banning them – Darby overturning Hammer

4. Broad definition of economic (?) - an activity can qualify as being “economic” even though it is “not itself ‘commercial’”

5. NOT REQUIRING “economic” in order to aggregation. a. Even if the cultivation/use of weed was noneconomic and noncommercial in nature,

Court ask whether the entire statutory scheme had a substantial effect on interstate commerce w/o zooming in on specific facts.

b. I.e. whether regulation of this small little thing (the subclass) was N+P to the entire large general scheme and this is okay to do under the Commerce Clause.

c. Here, there was no Q as to whether the whole CSA was doing in accordance with Commerce Clause.

iv. Justice Scalia’s Surprising Concurrence1. Looks ONLY to the N+P clause, not to the SAC reasoning

a. N+P = federal government’s smoking gun2. Puts the “limit” on N+P as it must be reasonable and necessary => Not specific date, but

RATONAL BASIS TEST for N+P Congress’s discretion for the means (which we saw also in Katzenbach) => therefore this is is N+P to Congress doing the CSA => according to Scalia, don’t need the SAC test of the majority if it’s done w/N+P

i. Issues in the Wickard Tug of Wari. Was Wickard “economic” => Said YES in Lopez and Morrison

1. Fillburn was “economic” and used to distinguish Wickard from the present cases, where can’t look at aggregate effects to get to SAC to get to Commerce Clause

ii. NOT “COMMERCIAL”1. Raich: Analogizes to Wickard, and says that in analogizing, not viewing as “commercial” –2. “in Wickard, the Court established that Congress can regulate purely intrastate activity that is not

itself “commercial,” i.e., not produced for sale, if it concludes that failure to regulate that class of activity would undercut the regulation of the interstate market in that commodity. The similarities between this case and Wickard are striking…

If Congress does have the power from the Commerce Clause to regulate ____, is that power of Congress limited by the Federalism Concerns/Anti-Commandeering Principle/10th Amendment?

1. Federalism Limits => 10th Amendmenta. Federalism: We have a system set up of two sets of sovereigns: one national and the other state. Each may operate

within the full dominion of its assigned sphere. Limited government, limited on the federal government, can only exercise enumerated. State governments have reserved powers.

i. Even if “truisum” or “tautology” => can enforce10th A limits on Congress when exercising too much federal power via the Commerce Clause.

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ii. *Federalism is a limit THROUGHOUT Con Law, but because CC is so broad, this is particularly an issue here.

iii. Purposes: Allow states to be “laboratories of experiment” (gay marriage, marijuana legalization, gun laws); representation better; direct democracy; accountability; prevent tyranny (checks and balances)

b. Cases that address 10th Amendment/federalism limit on Commerce Poweri. Lopez – Not SAC, but also federalism concerns, “police power”

ii. New York DID limit the reach of federal government by federalism [the anti-commandeering principle]: Printz. DID limit the reach of federal government by federalism [the anti-commandeering principle]:

iii. Garcia - DID NOT limit the reach of federal government thru SCOTUS enforcement of federalism (states were including in generally applicable laws)

iv. Reno v. Condon – of state commercial activities.

2. Judicial Enforcement of 10th Amendment => Anti-Commandeering Principlea. Not limited - Congress can regulate municipal employees: Garcia.

i. Fair Labor Standards Act at issue, Congress wanting to apply the FLSA min wages/max hours to Metropolitan Transit Authority (municipal employees).

ii. Holding: Congress DOES have the power to regulate the municipal employees.iii. Rationale: This issue should be solved through the political process not through judges; Congress does

have the power to regulate the municipal employees. 1. The principle of federalism is sufficiently protected through the political and not judicial

proce ss => to apply – is federalism sufficiently protected through political and not judicial process => then federalism argument is much weaker.

2. Congress, which has representatives from the states, must make the necessary judgments about the scope of any intrusion upon state sovereignty… even though Congress is a national body.

iv. Dissent argues: This leaves states at the mercy of Congress not to overstep its bounds, encroaches too much on states. (to which the majority says: the political protections apply instead).

b. Effect of Rehnquist Court => Congress cannot commandeer the state executive branches: Printz (1997)– Brady handgun act is not okay [background checks on guns, chief law enforcement officers have to carry out this law]

i. Federal Handgun Act ii. Holding: Congress can also not regulate for the executive branches of states.

iii. Rationale: Fed is using state official to do the fed government’s work, state is not a branch of federal government, also allows Congress power to pass laws that Congress doesn’t have to pay for.

1. Problems with this: financial burden, would be going around New York’s holding (by using executive instead of Congress’s power), accountability, tyranny.

iv. Dissent: This will backfire, will create more bureaucracy, it will end up working against having a limited federal government.

c. Effect of Rehnquist Court => Congress cannot commandeer the state legislatures/cannot interfere with state legislative process: New York (1992) – the dissent in Garcia becomes the majority in New York

i. Low-Level Radioactive Waste Policy Amendments Act of 1985. Three parts to the law: access incentive, monetary incentive, sanction “take title” that Congress had legislated (actually states had come to agreement and had Congress enforce), then NY brings suit saying no power of Congress for these measures.

ii. However, Congress cannot directly force a state to administer a federal regulatory scheme. => No power for the “take title” provision.

iii. Reasoning: 1. Federalism -- although O’Connor calls the 10th A a “tautology” and acknowledges that Congress

can encourage state regulation, Congress cannot directly force a state to administer a federal regulatory scheme, that would be commandeering the states.

a. Gave states two choices: regulate the waste according to Congres, or take title to the waste and risk the liability that follows. O’Connor said these were both unconstitutional because it meant forcing the states into a Congressional scheme.

b. Congress cannot directly force a state to administer a federal regulatory scheme.2. Accountability - In general O’Connor is worried about this commandeering because then do not

have accountability.3. Protect the People (rather than be a referee between the states)

a. Bargaining doesn’t make a difference: consent is irrelevant if something is unconstitutional going on, Congress can encourage but can’t commandeer, doesn’t matter

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(consent is irrelevant) because the purpose of federalism is not to protect the states but to protect individuals.

iv. However, Congress MAY encourage (from the New York opinion)1. Carrots-can fund certain things and not others under Spending Clause. 2. Sticks – federal-pre-emption

a. New York – parts 1 and 2 of the legislation were okayv. There may not be commandeering IF…

1. Generally applicable law (as business, not as government – Reno v. Condon)a. Reno v. Condon – DMV’s giving away information. Preventing disclosure of DMV

records. Constitutional challenge to the Driver’s Protection Priavcy Act which prohibited DMV’s from knowingly disclosing or making avialble any person info obtained in connection with a motor vehicle record.

b. Holding: Was NOT an example of commandeering – was of a state commercial activity, requiring the state to follow the federal policy here was not the state’s control of how regulate their citizens, but instead regulating states.

c. State as a state, not as a state regulating its citizens. 2. Act/Omission distinction – Reno v. Condon again

a. Preventing, not REQUIRING, disclosure of DMV records. Putting a stop to something = omission, not requiring an act, Congress can exercise this authority over the states; it isn’t commandeering.

3. Where We Stand Now with CommandeeringNOTE!! New York DID NOT overrule Garcia.

a. New York and Garcia dealt with two very different types of federal action: New York was federal regulatory law by Congress over states (going to make them take title for their nuclear waste), whereas Garcia was FLSA provisions.

b. According to Garcia, Congress can mandate the wages and hours of state/municipal employees (and does).i. Is this law regulating the activities of the state itself, as a business or as an employer?

1. Garcia: as an employer2. Reno: as a business, as a DATABASE provider

a. Did not force the states to enact or implement any federal regulatory policyb. Did not commandeer states by requiring them to enforce an Act c. Instead, law against the states themselves as a business.

c. However, under New York, cannot MAKE states administer Congress’s federal regulatory policies— Congress cannot require that states serve as an administrative arm for implementing federal regulatory policy.

i. So, if something looks fishy, ask: does it look like Congress is USING THE STATES as a way to accomplish its bureaucracy goals?

ii. OR, Is Congress trying to entice states to follow its program (CARROTS, STICKS)? Critical distinction between enticement and direct coercion.

1. Requiring: This is why Brady was not valid—Printz (1997) – required, not enticed, that states follow the Brady Handgun Act. This meant that states were acting as the administrative arms of Congress, and that messes up the boundary between state sovereignty/federal, threat to federalism. Would have been different if Congress had given incentives to states to follow the handgun act.

iii. Or, is Congress allowing for federal pre-emption – because this would be okay also.1. What is “federal pre-emption”? AKA “cooperative federalism” – when Congress could offer the

sates the choice between adopting the federal regulatory program and being preempted by the federal regulation of the private activity at issue.

a. You can adopt ours, or you can figure it out yourself and be subject to federal regulation – ask TA more about this/Grove.

Permitted – NOT a limit on Congress’s CC Power Prohibited: Limit on Congress’s CC Power1. Encouragement or Incentives :-Conditional Spending (see Spending Clause below) (carrot)-Offering states the choice to be regulated or be pre-empted (stick)

“COMMANDEERING”

1. Of the state’s legislative process => New York (compelled enactment of laws/regulations) (also compelled subsidies)

2. Of state executive officials => Printz (compulsory administration or enforcement of federal programs).

2. Direct Regulation:-Including states in generally applicable laws: If you were to open up your own DMV, you would also be regulated based on the DMV law, not state a sovereign, state as business, so not commandeering government. (Reno) (Garcia) If you are an

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employer besides the state have to follow FLSA for wages/hours.-Of state commercial activities => state as a business =/= commandeering.-

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NON-N+P OR COMMERCE POWERS OF CONGRESS: SPENDING, WAR, TREATYArticle I s.8 cl. 1: Congress shall have power to lay and collect taxes, duties, imposts, and excises, to pay the debts and provide for the Common Dense and general welfare of the United States; but all duties, imposts, and excises shall be uniform throughout the United States.

1. Spending Powers *but be alert for standing problems with such cases – generalized political taxpayer grievancea. Scope of the Power

i. Congress has the power to tax and spend for the general welfare.ii. Power is very broad; can go beyond CC power.

iii. Here, “commandeering” (limit on CC power) is just called “encouraging” and IS ALLOWED. => as SD v. Dole indicates, Congress can do “a hell of a lot” (Grove’s words).

b. Test – South Dakota v. Dole, the 4 (or 5) part test on Congress’s spending power (GUNC): 1. General welfare: Source of this part of the rule: The constitution –“provide for the general

welfare.”a. Congress is seen as the policy-maker. If it gets thru Congress, it will be seen as “in the

general welfare.” Congress’s stamp of approval = Court won’t even question/look at whether it is in favor of the “general welfare.”

2. Unambiguous: States must be able to knowingly/unambiguously accept the conditions/understand the consequences of getting the funds (also easy to meet)

3. Nexus:The condition on the money must be rationally related to the spending program. (harder to meet, but they use a looser standard for “related” than the one that dissent O’Connor) (at issue in SD v. Dole)

4. Const: No independent Const. bar. (at issue in SD v. Dole)5. Not coercive (5% vs. 100% in Rehnquist South Dakota v. Dole; today has been pushed to 10% of

the funds cannot be given in order to encourage certain goals). a. Note: healthcare law cert. may be changing this question; cert. granted on the issue of

whether Congress putting more requirements on states for what they have to cover under Medicaid (carrot model) = “coercive.”

c. Relation to anti-commandeering principlei. Commandeering rule: Congress cannot coerce/make a state legislature enact a federal law/policy. (See

New York, the low-level nuclear waste case, O’Connor majority opinion, under federalism-related limits on the CC.)

ii. Why does this not violate the anti-commandeering rule? Because in New York, O’Connor put in two exceptions:

1. CARROTS —money with conditions, AKA SPENDING CLAUSE.2. STICKS – pre-emption by the government, have to do your own answer to the problem or else

federal plan will come in.d. Justifications for allowing such a broad power to Congress thru the Spending Clause

i. Choice/indirect: if SD really didn’t want to increase the drinking age, did not HAVE to, it was a choice for them to make, should not be ‘coercive,’ that is one of the limits in the Spending Clause test.

ii. Power of Purse: Congress has long had power over the purse, with that power to say how $ should be spentiii. **Political Checks are in place: Congress has to give something up (and spend money) in order to be able

to impose these limits – must be a limit on money that is already being given, Congress has to give something up/spend money in the first place. And when Congress is spending money in the first place politically accountable.

1. This is also why the Spending Clause is not used all the time. e. CASE: Congress couldn’t go all the way and put in place restrictions on drinking age (21st Amendment) so instead

regulating Federal Highway Legislation => the legislation required 21+ drinking age for states required in order not to lose 5% of their highway funds.

i. Majority held that was within the spending power, Congress has the power to cut 5% of the states’ federal highway funds if don’t boost the drinking age to 21.

ii. At issue for the Spending Clause here were nexus and independent bar (held that 5% wasn’t coercive). 1. Nexus:

1. Majority approach => Holds that nexus only has to be rationally related, does not have to be very closely related, instead that can be attenuated. Here you can stretch the connection between Federal highway funds and drinking age (their rationale: teens driving to other states to buy dranks, driving on highways, messing up roads, getting in accidents, highway funds).

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2. O’Connor Standard => Should be reasonably related, as is overinclusive and underinclusive.

2. War and Treaty Powers- They are both broader than other powers: even broader than the CC power and N+P Clause power – which we said were pretty broad.- However, they are both limited by the Bill of Rights => Missouri v. Holland (re: treaty power) and Woods (re: war power). And, the fact that Bill of Rights is a limit is not even much of a limit b/c state action would be required to have this anyway. a. Treaty Powers

i. NO 10th Amendment Limit ii. Justification: Senate has the voice of the states, and treaties CAN commandeer when other federal

legislation could not1. The Senate input into treaties is a justification for the very broad treaty power. We expect the

Senate to speak up for their interests, to have the states “speak” for their interests => therefore can have broad power. To ratify a treaty: 2/3 Senate + President required. Particularly during Founders’ period, the Senate was chosen by state legislators. Still today, it is the voice of the states (at least thought to be) b/c each state gets 2 votes, more representing the interests of all the states.

2. Only exceptions: Bill of Rights (cannot conflict with Bill of Rights), this is the same even after Reid.

b. CASE: Missouri v. Holland (1920)i. Why was the case under the treaty power? Because it was at a point in the Commerce Clause

history where very limited CC powers – not broadened until 1937.ii. Facts: The treaty w/England enacted Migratory Birds Act, using the treaty power to do so.

iii. Issue: Does Congress have the power to do this?iv. Holding: Yes, Congress has the power. Treaty power = not subject to the traditional limits on

Federal power, rather, no 10th A prohibition, could commandeer, could contravene the Const so long as not against the Bill of Rights (sacrosanct). => but “10th Amendment is no barrier” to the treaty power acc. to this opinion.

b. War Powers (ARTICLE I, S. 8 CL. 11-14)i. Also NO 10th A limit here.

ii. Extends BEYOND the duration of the war => Woods holding iii. A lot of times will be used in conjunction with the N+P Clause (ex. Woods, housing was N+P for the

war effort)iv. Woods (1948) – Did Congress have the power for Title II of the Housing and Rent Act of 1947 – did

Congress still have the power to regulate rents based on the war power? => Yes. 1. Reasoning: War power doesn’t end necessarily when hostilities are over – when the effects are

over, here the deficit in housing ont yet eliminated – the forces that created the short supply (the purpose of the rent control bill) are still occurring. Reject criticism that “swallows up the other power of Congress,” and violates 9th and 10th A’s. Departmentalism – Congress can be alert of its own const responsibilities.

2. Concurrence – Justice Jackson: be wary of expanding this, here it’s okay b/c “we are still technically in a state of war,” & “still have our armies abroad and no peace terms with our enemies” (this was 1948) but must be cautious of passions and pressures around wartime, rampant patriotism, etc

v. Where does the War Power come from? 1. N+P clause in conjunction with Article I, S. 8 CL. 11-14

a. The ends: Article I, s. 8, cl. 11-14 – “maintain armies and navies” (etc)b. The means: means within Congress’s discretion broad power to decide, here decide

that need rent control to keep armies/navies (so that when they come back, can get housing).

1. Vesting Clause – Article II §1: “the executive Power shall be vested in a President of the United States of America”

II. Does this fall within an enumerated power? => Article II Powers of Executive BranchDoes President/Executive Branch have the power?

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2. “The Commander-in-Chief” Clause – Article II § 2 Cl. 1: “President shall be Commander in Chief of the Army and Navy of the United States, and of the Militia of the several States…”

a. Anything having to do with war => Youngstown 3. Appointment Clause- Article II §2 Cl. 2: “shall appoint officers…” 4. The “Take Care’ Clause- Article5. Foreign Affairs

a. Sole Organ View i. There is one view of foreign affairs that does not think foreign affairs should have to be subject to

legislature’s proval b. Subject to Youngstown Test

6. **Separation of Powers Issue = very important for Executive => can also apply Youngstown by analogy for other Executive action if you have time (maybe)

Note! There will always be a Youngstown Test issue that comes up if the Executive does anything foreign affairs (or you apply by analogy) because Congress MUST have either said something good, something bad, or nothing at all => so ALWAYS GO THERE if you’ve got a Foreign Affairs + Executive Action issue.

A. Separation of Powers: Introduction Trying to Spot

o If there is EXECUTIVE and the executive agency/President SEEMS TO BE LAWMAKING, ask: does the delegation doctrine apply? OR is this an executive encroachment of legislative power?

o If anyone is doing out of their ‘sphere’ (which is: jud => interpret; executive => carry out laws; Congress => make laws), ask: ENCROACHMENT?

Exampleso Could be Executive => Legislative encroachmento Could be Legislative => Exec encroachment (which did not fly in Chadha b/c nondelegation is one-way)o Don’t usually see it with judicial => others, but Powell concurrence in Chadha that Congress was being judicial

Separation of Powers exists as… Reasons for Horizontal Separation o fPowers

B. Separation of Powers Issues in Domestic Affairs1. Congress Encroaching on Executive

a. Delegation and the Administrative State => Cannot exercise control once delegated.i. No One-House Veto

b. Must Do Their Role (stay in their power of) Bicameralism and Presentmentc. Cannot Encroach on (Exclusively) Executive Privileges => Presidential Appointment and Removal

2. Executive Encroaching on Congress (cannot make the laws can only carry them out)a.

C. Separation of Powers in Foreign Affairs

IV. Is this a STATE doing something? => States are assumed to have the power, because reserved powers => Is there a LIMIT on the state’s action? => Dormant Commerce Clause issues, 14th Amendment Analyses (see later)

III. If there is a power of the Legislature or Executive, is there a horizontal separation of powers issue/limit?

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>> The Dormant Commerce Clause1. Doctrinal source: Inference from Commerce Clause (Article I, s. 8). But not a specific source in itself.

a. Not the Import-Export Clause, this has been “interpreted away,” only to apply to international importing/exporting. b. Also not based on the N+P Clause because that gives Congress the power to invalidate states (that is the power of

Congress to __[anything necessary and proper]__). Here it is the Court that is making this inference about the2. Justification:

a. Historical background: the whole Constitutional Convention only came about because the Framers wanted a Commerce Clause/a way to end the system of protectionism that characterized the Articles of Confederation commerce. Importance of the Commerce Clause => this inference that can limit the actions of states in order to enforce the Commerce Clause. -- Founded on the idea that totality of CC is to protect interstate commerce, unlike the Articles

b. National Unity: framers coming from the Articles, they wanted to minimize rivalries among the states. c. Free Trade

Protecting free trade and not having protectionism. Protecting the consumers (you, the people)

d. Representation: Want people who are affected by a certain law to have representation in the legislature making that law. (the political process factor)

3. FORK => Which justices don’t accept the DCC doctrine? a. Rehnquist, Scalia, Thomas: Argued in Camps Newfound that there was no valid textual or other justification for

the DCC jurisprudenceb. Thomas and Scalia: Think that DCC should not play a role even when states impose taxes and interstate or foreign

commerce and that the Import-Export Clause should be revived instead of using the “DCC.”4. Summary: The Five Step Test

a. Discriminatory or neutral? On face? If not facially discriminatory => Purpose (hard to tell)? Effect?

b. Market Participant Exception?c. If Discriminatory and no Market Participant Exception => strike downd. If neutral => Pike Balancing Teste. Consider other factors.

5. Other tips for applying DCC:a. Be on the lookout for:

State laws that aim to regulate interstate commerce or control out-of-state transactions. Laws that look like they are discriminating against out-of-state actors. Laws that don’t discriminate against interstate commerce but still BURDEN interstate commerce – could

be struck down on grounds of discriminatory effect or burden on interstate commerce via Pike Test. “Access barriers” like in NJ

Hoarding of resources Discriminatory taxes “Home processing” resources

b. ASK! Is this law rationally related to a legitimate state purpose? There will usually be something that the state

says—whether it’s “clearer marketplace” (Hunt) or “plastic is bad for the environment” (Clover) or “we want more recognition that melons are AZ grown” (Pile) – and what a lot of this will turn on is whether the Court “buys” this explanation or thinks that it’s a cover-up for what instead is protectionism as the purpose, which is NOT okay by DCC => will be struck down.

If you think that protectionism as a purpose is okay, think about what happened in Bacchus – they conceded that point and it was discriminatory in purpose just like that.

In addition, “protectionism as purpose” would also be if the state adopted the law to shielf the state’s sellers from interstate competition. Fatal.

Also fatal if the law is a means to further economic protectionism Yet, if it sounds convincing, what Clover Leaf tells us is that the Court (in the rational basis test

mindset) will be loose in giving this purpose discretion to the state – it wasn’t even clear that the plastic was less wasteful, but because it could have been less wasteful, deferred to the state legislature’s judgment.

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In the balancing test or in discriminatory effect, if the means are imposing a burden, the question “are less discriminatory available?” could be added to the balancing example. The state will be given a chance to show that there are no less discriminatory way to achieve its goal. (Example: quarantine, no there is no other way.) See this in New Jersey v. Phil.

The Five-Step Test with Cases

The issue in all of these – does the state have the power to _____?

1. STEP 1: Is the law discriminatory or neutral?a. On face? => Invalid unless the law’s purpose is legitimate and it could not be served by nondiscriminatory

means. i. Philadelphia v. NJ [invalid, discriminatory on face (OOS no, in-state yes)] NJ bans out-of-state

trash. Facially discriminatory because NJ just came out and said: if your trash is not Jersey trash, it is flat-out not allowed in our state. In-state YES, OOS NO. => Facially discriminatory.

1. Holding: Strike down the law using DCC, unconstitutional b/c blocks the flow of interstate commerce against borders, is protectionism.

2. Rationale: Flat out discriminatory against interstate commerce. If you want to ban trash go ahead, but you have to ban everybody’s, including your own. Also there are exceptions to the rule of discriminatory importation, but they are discriminating against goods inherently dangerous. Also warn NJ that they do this, but what happens when they want someone to do something for them? State rivalries (justification for DCC in application).

ii. West Lynn Hill Creamery [invalid, discriminatory on face (OOS no $$, in-state yes)] MA trying to tax milk sales of all milk products, but then give subsidies attached to these taxes to MA milk producers.

1. Holding: strike down law based on DCC. 2. R1: Taxing alone is okay, subsidies alone are okay, but this violates the CC because knew that

the tax was tied to the subsidy (were bundled together), and the fact that each component parts of the program is Constitutional does not mean that the tax and subsidy program taken together are Constitutional.

3. R2: By joining the tax w/the subsidy the state political process is cannot fix this. One of the in-state interests, the Massachusetts milk producers, which would otherwise lobby against the tax, has been mollified, and the OOS people don’t have remedy against this.

4. Case is an example of the political process factor – and how it would have not been able to provide for the political remedy for the OOS milk producers.

iii. Camps Newfound [invalid, discriminatory on face (OOS-serving no, in-state serving yes)] Maine. Benefit tax on nonprofits, but said no exemption to property tax for groups that primarily serve OOS people – like this summer camp.

1. Holding: Strike down. Maine does not have the power to pass this law violates DCC.2. R1: Cannot discriminate against nonprofit and for-profit, and applying that standard, can to

tax subsidies but can’t do tax-breaks for in-state vs. OOS-serving. Subsidies = more transparent than tax exemptions (is thought to be the justification).

3. R2: no political power for OOS to combat this. (political process rationale again)a. Also, TAX is different than subsidies!!!

iv. Could also have facially discriminatory w/natural resources – out West. b. If not facially discriminatory => Purpose (hard to tell)? Effect? => Invalid unless the law’s purpose is legit. and

it could not be served by nondiscriminatory means. i. Purpose: Came out and said it. The law was facially neutral again [all the ones we read for today

are] because not saying ONLY HAWAII IS TAX-FREE but b/c it was indigineous plant, it was discriminatory in purpose and effect. State even said that their purpose was to help the struggling state economy bad thing to say when the test is whether or not this is protectionist/discriminatory in purpose/effect. Held: does violate DCC.

ii. Effect: Hunt – apples in North Carolina, making WA grade their apples not WA special (superior) grade by USDA grade. More specifically: the NC law required that closed containiers of apples offered for sale or shipped into the state bear “no grade other than the USDA grade” – Washington had superior system, Court appears to accept (Grove said: “they didn’t buy it, though”) that the purpose of the law was to end confusion, but the bad purpose is NOT REQUIRED, can also because of a discriminatory effect and there was a less discriminatory way to get that that goal.

1. Held that discriminated against WA even though everyone had to apply the USDA – but had special impact on WA because only WA had their own system in place – does violate DCC.

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2. NC said that their purpose was “trying to increase transparency in the market” Court didn’t buy it though. Everybody else (the consumers) wanted the WA apples, and also having the real WA system would probably increase transparency.

3. Therefore, rationale: (1) Discriminatory in effect and (2) Didn’t buy the rationale from the state. Because if they had bought it, this discriminatory effect would be more like Clover Leaf, where there was a discriminatory effect (although less egregious, and at many states) => state law was NOT struck down.

iii. NOT Discriminatory in Effect: 1. Exxon – gas station retailers regulation. Retailers cannot be owned by producers/refiners of

gasoline. Discriminating against everyone equally = okay. Holding: the MD law does NOT violate the DCC.

a. Why? Oil shortage. Exxon would favor Exxon gas stations – hurts independent gas station retailers b/c gas shortage, they can’t get gas. 99% of those people = MD people, vs. all the OOS people from Exxon. And, Maryland does NOT HAVE ANY GAS REFINERIES OR PROCESSORS IN THE STATE – this means that they are discriminating against everyone equally.

b. Court also relies on other justifications: vertical integration justification; discriminating against firms vs. against commerce.

c. Problems with this opinioni. There ARE benefits/discrimination, it’s just at a wider level – retail level vs.

discriminating based on the d. Also in this opinion: Was b/c industry was struggling… didn’t want to hurt the

industry. But doesn’t reconcile on this point with Hunt – b/c there hurt consumers (prices would go up).

e. Discriminatory in effect is okay if the Court buys that there is a purpose other than just protectionism. Purposes here: vertical integration, firms (weaker than in Clover).

2. Clover Leaf Creamery – Law said yes pulpwood, no plastic. Applied to in-state and OOS. Challengers said that MN had the pulpwood industry, this was protectionist.

a. Unlike other cases w/discriminatory effect, here, the Court bought their reasoning that it was used for conservation: legitimate benefit.

b. Also applied the Pike Test – see Step 4. Pike Respondents exaggerate the burden in the Pike analysis burden not actually very large.

a. Not all plastic is being gotten rid of. b. Unlike WA where it was based on WA, anyone can create the pulpwood

3. If it is burdening anyone, it is burdening a few firms and not all of commerce

2. Market Participant Exception? a. Generally: City or state can, in general, discriminate in favor of its own residents when it functions NOT as a

“regulator” of the market but as a “market participant.” If the state is acting as a market participant, its actions are treated like those of a private party and the state is exempt from DCC limitations.

b. Justifications:i. Founders did not intend to restrict the states’ ability to operate freely in the market b/c wanted state

sovgt’y – Founders’ Intent of Art. I 8 cl. 3 – implicit in the DCC that the state should be able to favor its own constituents when participating in the market, subsidies are not the same regulation (and this acts as a “subsidy”)

ii. Market forces will act as controlling, don’t need as much judicial interference (‘the market will take care of it’)

iii. Econ Effect – preference w/in state not as damaging to IS commerce as barriers being put upiv. Federalism and states as experimental groundsv. Investment capture – state can better capture the benefits of its citizens’ tax exemptions.

c. Arguments Againsti. Founders’ intent = unclear

ii. State cannot act like a private business, it isn’t really, it’s a fiction, they have the power to tax and might abuse that if unregulated.

d. See it when: i. State as buyer or seller of goods

ii. State subsidies (can view in this way) (West Lynn Creamery PART OF IT would have ben okay)iii. DO NOT HAVE IT APPLY IN state tax exemptions and state tax credits (Camps Newfound)

1. Tax credits or exemptions are never eligible for this discriminatory treatment

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2. Although they can have the same effect as subsidies (discriminating btw in-state and OOS for tax credit/exemption) treated differently.

3. Justification 1: transparency4. Justification 2: tax = historic, ingrained feature of gov’t, allowing discriminatory tax would

be “dramatic expansion” of gov’t market participant exception e. Cases for supporting application of Market Participant Exception

i. Alexandria Scrap: State as buyer. Maryland program designed to reduce the # of junked cars in the state the state imposed more stringent documentation requirements on out-of-state scrap processors than on in-state ones.

1. Was this a CC attack by MD? NO it was not: Maryland’s action was “not the kind that the CC is concerned about” can participate in a market and exercise its right to favor its own citizens over others.

ii. Reeves: State as seller. South Dakota policy restricted sale of cement from state-owned plant to state residents. ONLY THE STATE RESIDENTS GET THE STUFF, YOU OOS SUCKERS.

1. Court said it was okay: the long-established right of a trader to discriminate between the people it sells to.

iii. White v. MA: State as employer. Mayor Boston req’d all construction projects funded in whole/in part by city be performed by work force of at least 50% city residents.

1. Court said did not violate Dormant CC, because the order had the effect o regulating employment contracts between public contractors and their employees this meant that everyone was “working for the city” – all parties that gov’t was in transactions with – could discriminate.

f. Cases for arguing that DON’T apply Market Participant Exception, aka that the state’s regulation exceeded its scope of “market”: South Central Timber (1984) *cannot regulate DOWNSTREAM

i. Alaska had timber company. Alaska could sell its timber to whoever it wanted – that was part of the Market Participant Exception. However, Alaska’s regulation about its timber went further than this—Alaska wanted to put regulations on where the processing of its timber would be after selling.

ii. Issue: Could Alaska regulate the processing of the timber it sold as a “market participant”?iii. Holding: NO. The seller cannot regulate the processing after the sale. The market does not extend that

far. (Alaska wanted to say that the “timber market” or the “timber sale” includes the processing, but this was not what the Court found, that their role as a market participant ends after the sale of the timber itself.) aka: Downstream regulations exceed the scope of being a market participant.

1. If allowed downstream, argument that would swallow up anything, could regulate anything (or be a “participant” in anything).

iv. Dissent: This is too formative. g. Gray area: Hypo: ABC Laws in North Carolina

3. If Discriminatory (Facially, Purpose, or Effect) and no Market Participant Exception => strike down (New Jersey, West Lynn, Camps, Bacchus, Hunt, South Central)

4. If neutral => Pike Balancing Test (note: usually will NOT strike down the state law. Kassel is rare here) => Do the balancing test, tease it out.

a. In Pike, applied the balancing test, but it wasn’t clear that it was necessary to strike this state law down that you would need to use the balancing test. Could be seen as discriminatory on face (yes AZ, no CA or other states), or in purpose/effect.

i. Facts: Melons (cantalopes) had to be ID’ed as from Arizona under law. People like Bruce Church didn’t want this, because people don’t think melons from Arizona sound good. Church was an AZ grower, who shipped cantaloupes to CA for packaging, where they were not ID’ed as AZ-grown.. He also had high quality cantaloupe.

ii. Holding: Does the burden on interstate commerce outweighs the putative benefit? Yes. $200,000 in packing expenses to add the labels. Not worth the putative local benefit of knowing that the melons were from AZ.

iii. **Note: Although Pike is the start of the balancing test, it’s clear that it applied it to Pike itself. Pike can also be read as an example of (1) facial discrimination (yes AZ no CA) (2) political processes rationale – CA packaging people don’t have political remedy; (3) discriminatory in effect (which it was… against CA packaging).

b. Kassel: I-80 in Iowa, banned trucks that were over 65 feet (the doubles). Held that it was invalid/discriminatory after the court applied the Pike balancing test in Justice Powell’s plurality.

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i. Pike Balancing Test Application: burden on interstate commerce outweighs the putative benefit. Analyzed the purpose as public safety. The benefit that they saw was safety, but said that might actually be working against that.

ii. Justice Brennan concurring: Protectionist purpose, don’t need to go to the balancing test, discriminatory purpose; discriminatory; invalid.

iii. Didn’t buy the safety purpose (said that was just from the litigation), but the purpose was to keep interstate commerce trucks out of Iowa.

5. Consider other factors. a. Does the Court buy the rationale?b. Does the political process allow a remedy?c. Social climate in favor? THINK: Exxon oil shortaged. Fact intensive approach is especially important heree. Market participant – how wide is the market?f. Any way to construe this as a “subsidy”? => subsidies are okayg. Any way to construe as a “tax” => taxes are NOT okayh. Market – downstream? (upstream – then what? Could be OK – ABC case)i. Any way to do what they want to do otherwise? => ex. In South Central, could have been less blatant and just

sold to in-state processors. j. If this law was not struck down, what would the implications be?