Thursday, February 20, 2014

Third Circuit on Pennsylvania's Funeral Director Law: Mostly Constitutional

Largely reversing a district judge's opinion that had found various provisions of Pennyslvania's Funeral Director Law unconstitutional on various grounds, the Third Circuit opinion in Heffner v. Murphy upholds the law except for its restriction on the use of trade names as violative of the First Amendment.

One key to the panel's decision is that it surmised that the district judge's conclusions regarding the constitutionality of Pennsylvania's Funeral Director Law (FDL), enacted in 1952, "stem from a view that certain provisions of the FDL are antiquated in light of how funeral homes now operate."  But, the Third Circuit stated, that is not a "constitutional flaw."

Anna_Ancher_-_A_Funeral_-_Google_Art_Project
"A Funeral" by Anna Archer via

The challenged statutory provisions included ones that:

(1) permit warrantless inspections of funeral establishments by the Board;
(2) limit the number of establishments in which a funeral director may possess an ownership interest;
(3) restrict the capacity of unlicensed individuals and certain entities to hold ownership interests in a funeral establishment;
(4) restrict the number of funeral establishments in which a funeral director may practice his or her profession;
(5) require every funeral establishment to have a licensed full-time supervisor;
(6) require funeral establishments to have a “preparation room”;
(7) prohibit the service of food in a funeral establishment;
(8) prohibit the use of trade names by funeral homes;
(9) govern the trusting of monies advanced pursuant to pre-need contracts for merchandise; and
(10) prohibit the payment of commissions to agents or employees.

The constitutional provisions invoked - - - and found valid by the district judge - - - included the Fourth Amendment, the "dormant" commerce clause, substantive due process, the contract clause, and the First Amendment, with some provisions argued as violating more than one constitutional requirement.

In affirming the district judge's finding that the trade names prohibition violated the First Amendment, the Third Circuit applied the established four part test from Central Hudson Gas & Electric Corp. v. Public Service Commission regarding commercial speech and found:

The restrictions on commercial speech here are so flawed that they cannot withstand First Amendment scrutiny. Indeed, the District Court correctly identified the pivotal problem concerning the FDL’s proscription at Central Hudson’s third step: by allowing funeral homes to operate under predecessors’ names, the State remains exposed to many of the same threats that it purports to remedy through its ban on the use of trade names.  A funeral director operating a home that has been established in the community, and known under his or her predecessor’s name, does not rely on his or her own personal reputation to attract business; rather, the predecessor’s name and reputation is determinative. Nor does a funeral home operating under a former owner’s name provide transparency or insight into changes in staffing that the Board insists is the legitimate interest that the State’s regulation seeks to further.

 [citation omitted]

ConLawProfs looking for a good review or even a possible exam question, might well take a look at the case.  It also seems that the Pennsylvania legislature might well take a look at its statutory scheme, which though largely constitutional, does seem outdated.

February 20, 2014 in Cases and Case Materials, Courts and Judging, Criminal Procedure, Dormant Commerce Clause, Due Process (Substantive), First Amendment, Fourteenth Amendment, Fourth Amendment, Interpretation, Opinion Analysis, Speech, Teaching Tips | Permalink | Comments (0) | TrackBack (0)

Thursday, January 2, 2014

Federal District Judge Upholds Most of New York's SAFE Act Against Second Amendment Challenge, Striking Some Provisions

In an opinion rendered on December 31, Judge William M. Skretny declared several provisions unconstitutional but upheld most of New York's SAFE Act in New York State Rifle and Pistol Association v. Cumo

Judge Skretny, Chief Judge of the United States District Court for the Western District, sitting in Buffalo, applied intermediate scrutiny under the Second Amendment,  drawing on the "post- Heller rulings that have begun to settle the vast terra incognita left by the Supreme Court."  He concluded that the SAFE Act's definition and regulation of assault weapons and its ban on large-capacity magazines further the state’s important interest in public safety, and do not impermissibly infringe on Plaintiffs’ Second Amendment rights.  However, he concluded that the seven-round limit did not satisfy intermediate scrutiny both on the governmental interest and the means chosen.

The plaintiffs also challenged ten specific provisions of the SAFE Act as void for vagueness and thus violative of due process:

  • “conspicuously protruding” pistol grip
  • threaded barrel
  • magazine-capacity restrictions
  • five-round shotgun limit
  •  “can be readily restored or converted”
  • the “and if” clause of N.Y. Penal Law § 265.36 g muzzle “break”
  •  “version” of automatic weapon
  • manufactured weight
  • commercial transfer

 The judge found three unconstitutional - - - the “and if” clause of N.Y. Penal Law § 265.36, the references to muzzle “breaks” in N.Y. Penal Law § 265.00(22)(a)(vi), and the regulation with respect to pistols that are “versions” of automatic weapons in N.Y. Penal Law § 265.00(22)(c)(viii) - - - concluding that these provisions were vague and "must be stricken because they do not adequately inform an ordinary person as to what conduct is prohibited."

The opinion also rejects the dormant commerce clause challenge to the provision of the SAFE Act that effectively bans ammunition sales over the Internet and imposes a requirement that an ammunition transfer “must occur in person.”  The government had argued that the challenge was not ripe given that the section does not go into effect until January 15, 2014, but Judge Skretny decided the question was one of mere "prudential" ripeness and that the claim should be decided.  Applying well-established dormant commerce clause doctrine, the judge found first that the SAFE Act did not "discriminate" against out of state interests and moving to the "balancing test" under Pike v. Bruce Church, Inc. (1970), the "incidental effects on interstate commerce" were not "excessive in relation to a legitimate local public interest."

788px-Ted_Noten_Murdered_Innocence_2005

Judge Skretny's 57 page opinion is scholarly and closely reasoned with specific findings.  Yet the Second Amendment issues certainly reflect the fact that there are no established standard for judicial scrutiny of the regulations of the "right to bear arms.  Recall that the Fifth Circuit's use of intermediate scrutiny in NRA v. AFT (regarding a federal restriction applying to persons less than 21 years of age)  and in NRA v. McCraw (regarding Texas restrictions also applying to persons less that 21 years of age) are both being considered on petitions for writs of certiorari by the United States Supreme Court.   Sooner or later, some sort of analytic framework for deciding Second Amendment issues will be established by the Court.  Until then, federal judges are left to navigate what Judge Skretny called the "vast terra incognita" of Second Amendment doctrine.

[image via]

January 2, 2014 in Courts and Judging, Dormant Commerce Clause, Due Process (Substantive), History, Interpretation, Opinion Analysis, Ripeness, Second Amendment, Supreme Court (US) | Permalink | Comments (0) | TrackBack (0)

Monday, April 29, 2013

States Can Restrict FOIA Laws to Own Citizens, Court Says

A unanimous Supreme Court ruled today in McBurney v. Young that a state can restrict its own freedom of information law to its own citizens without violating the Privileges and Immunities Clause or the dormant Commerce Clause.  We covered oral arguments here.

The ruling puts an exclamation point behind the idea that there's no fundamental right to public records.  If there were any doubt going into the case, this ruling settled the matter: Our Constitution doesn't require freedom of information.  If you want it, take it up with your legislature.

The case arose out of two out-of-state claimants' efforts to get Virginia state records through the state FOIA.  One of those claimants, McBurney, sought records related to the state's 9-month delay in enforcing a child support order that he had against his ex-spouse, a Virginia resident.  The other, Hurlbert, sought state real estate tax records on half of his clients.  The state didn't provide the requested records pursuant to its FOIA, however, because its FOIA extends only to state citizens.  (It did provide most of the records through other means.)  Both McBurney and Hurlbert sued, arguing that the FOIA violated the Article 4 Privileges and Immunities Clause and the dormant Commerce Clause.  

The Court disagreed.  In an opinion by Justice Alito, the Court said that the FOIA doesn't interfere with a fundamental right in violation of the Privileges and Immunities Clause.  It said that the FOIA doesn't violate the opportunity to pursue a common calling, because the law wasn't designed to provide a competitive advatage for Virginia citizens.  It doesn't violate the right to own or transfer property in Virginia, because Virginia makes the necessary records available through the clerks of its circuit courts (even if not through its FOIA).  The FOIA doesn't violate the right to gain equal access to Virginia courts, because its citizens-only application leaves open "reasoanble and adequate" access to the courts (because state procedure allows discovery and subpoenas, which would provide noncitizens with any relevant and nonprivileged information, and state law allows equal access to judicial records).  And it doesn't violate a claimed right to gain access to public information on equal terms, because, well, there is no such right.

The Court also rejected Hurlbert's dormant Commerce Clause claim, ruling that Virginia's FOIA neither regulates nor burdens interstate commerce.  "[R]ather, it merely provides a service to local citizens that would not otherwise be available at all."  Op. at 13.

Justice Thomas joined the opinion but wrote separately to remind us of his view that "[t]he negative Commerce Clause has no basis in the text of the Constitution."  

SDS

April 29, 2013 in Cases and Case Materials, Dormant Commerce Clause, Federalism, Fundamental Rights, News, Opinion Analysis, Privileges and Immunities: Article IV | Permalink | Comments (1) | TrackBack (0)

Thursday, March 28, 2013

How to Tax an Internet Retailer Even Without Physical Presence, New York Style

The New York Court of Appeals today upheld a state statutory presumption that internet retailer "associates" operating within the state provide a sufficient nexus for the state to collect sales tax on the retailer's state sales.  The ruling approves New York's end-run around the dormant Commerce Clause rule that a state can impose a sales tax on an out-of-state retailer only if the retailer has a physical presence--including economic activities by the retailer's employees, but not mere advertising.

With the rapid growth of internet sales across state lines, and with the last Supreme Court ruling on anything like this coming as far back as 1992 (on mail-order sales, of all things), this case may be a good candidate for high court review.

But on the other hand, the precise ruling in the case is rather limited.  That's because the plaintiffs in the case pressed only their facial challenge at the Court of Appeals, not an as applied challenge.  The problem here is that the statutory presumption can be rebutted, and an out-of-state retailer that can rebut it will also be exempt from it.  This gives the presumption some wiggle room in certain cases and may be enough to protect out-of-state retailers against state sales taxes when they don't have sufficient business activity to constitute presence.  The Court's ruling only says that the statutory presumption is not unconstitutional on its face.  That's a far cry from saying that it's constitutional in every application.

The case, Overstock.com v. New York State Department of Taxation and Finance, tests New York's statutory presumption that an out-of-state internet retailer's in-state "associate" is soliciting business for the retailer:

a person making sales of tangible personal property or services taxable under this article ("seller") shall be presumed to be soliciting business through an independent contractor or other representative if the seller enters into an agreement with a resident of this state under which the resident, for a commission or other consideration, directly or indirectly refers potential customers, whether by a link on an internet website or otherwise, to the seller . . . .

New York Tax Law Sec. 1101(b)(8)(vi).  The provision exactly describes Amazon's and Overstock.com's "associates"--local web-sites that include links to Amazon.com or Overstock.com and that receive a commission on each purchase through that link.  

But neither Amazon nor Overstock.com has a physical presence in New York.  And according to the Supreme Court in Quill Corp. v. North Dakota (1992), an out-of-state retailer like Amazon or Overstock.com has to have a physical presence in order for New York to impose a tax.  (Quill Corp. involved an out-of-state mail order retailer.  If you don't know what that is (!), click here.) Physical presence includes engaging in economic activities (like selling goods), but not advertising alone.

Enter the statutory presumption.  The presumption says that Amazon's and Overstock.com's "associates"--those New York-based web-sites that contain a link to Amazon or Overstock.com, and receive a commission on each sale--establish a sufficient nexus between the out-of-state retailers and the state so that New York can impose its tax.

And the New York Court of Appeals OK'd it.  The Court said that the retailers' associates were engaged in sufficient economic activity on behalf of the out-of-state retailers--business solicitation, and not mere advertising--to allow the state to tax.  

Judge Smith dissented.  He thought that the associates' links looked more like mere advertising, not business solicitation, and therefore weren't enough to establish a nexus between the retailers and the state.

The Court also rejected the retailers' due process claims, because the presumption is rational.  The Court explained:

It is plainly rational to presume that, given the direct correlation between referrals and compensation, it is likely that residents will seek to increase their referrals by soliciting customers.  More specifically, it is not unreasonable to presume that affiliated website owners residing in New York State will reach out to their New York friends, relatives, and other local individuals in order to accomplish this purpose.

SDS

 

March 28, 2013 in Cases and Case Materials, Commerce Clause, Dormant Commerce Clause, Federalism, News, Opinion Analysis | Permalink | Comments (0) | TrackBack (0)

Thursday, February 21, 2013

Can States Limit Government Information to Their Own Citizens?

The Supreme court heard oral arguments yesterday in McBurney v. Young, a case testing whether a state's freedom of information law, or FOIA, can limit access to government information to its own citizens consistent with the Article IV Privileges and Immunities Clause and the Dormant Commerce Clause.  (Together these provisions restrict states in discriminating against out-of-staters in the exercise of fundamental rights or important economic interests, or in interstate commerce.)  The case was brought by two out-of-staters against Virginia after the state denied them access to records related to the state's enforcement of a child support order and state property records collected for clients as part of a business.  Virginia is one of only three states that restricts its FOIA records to in-staters.

The case is tough, because it's not obvious that Virginia's restriction is a restriction on interstate commerce (in violation of the Dormant Commerce Clause), and it's not obvious that the access that the petitioners seek is the kind of right that they, as out-of-staters, should enjoy with respect to Virginia.

The questions from the bench went right to these points.  The Court was concerned about whether Virginia's restriction was, in fact, a restriction on commerce,  or whether it was merely a law, not a commercial regulation, that had at most an incidental effect on interstate commerce.  (The Dormant Commerce Clause points go to the property-records seeker, not the child-support seeker.)  In other words: does the Dormant Commerce Clause even apply, given that this may not be a regulation of commerce?

Justices were also concerned about the magnitude of the effect, on both sides.  As to the petitioners, they wondered why the cost to the petitioner wasn't negligible.  After all, any out-of-stater could simply hire an in-stater for a nominal fee to file their request and thus dodge the restriction.  As to the state, they wondered why the cost to the state in providing equal access to its records was significant.  The burden of addition requests from out-of-staters didn't seem to be much.

Finally the Justices wondered whether Virginia shouldn't be allowed to restrict access to its records, given that its law is designed to provide access to government information to ensure good government--a concern that applies uniquely to Virginians.  On this point, several Justices compared the right to access to the right to vote, and noted that out-of-staters don't get it.  In short: Shouldn't Virginia be able to keep its records to its own state citizens?  The question goes at least in part to the purpose of Virginia's FOIA--to provide information on governance (as the state would have it), or to restrict information in restraint of free trade (as the petitioner argued).

The parties didn't provide terrific answers to any of these questions.  But counsel for the petitioner did note that the challenge was as applied, not facial.  This could allow the Court to rule narrowly in favor of this individual, without overturning the restriction as to anyone else.  But even that result seems likely only if the Court can get over two threshold problems.  First, the restriction is not a direct discriminatory regulation of interstate commerce (even if it may have an indirect effect on interstate commerce in this case).  Next, Virginia is certainly able to restrict some of its state functions to its own citizens.  The question for the Court: Is this one of them?

SDS

February 21, 2013 in Cases and Case Materials, Commerce Clause, Dormant Commerce Clause, Federalism, News, Privileges and Immunities, Privileges and Immunities: Article IV | Permalink | Comments (0) | TrackBack (0)

Friday, November 30, 2012

Sixth Circuit Strikes Michigan's Bottle Return Label Requirement

The Sixth Circuit ruled in American Beverage Association v. Snyder that Michigan's requirement that returnable beverage containers bear a unique mark violated the Dormant Commerce Clause.  The ruling strikes Michigan's requirement. 

The ruling turns on the dormant Commerce Clause's "extraterritorial doctrine," which, according to one concurring judge on the panel, is "a relic of the old world with no useful role to play in the new[.]"  If so, this case could offer the Supreme Court a good chance to clean up this corner of the dormant Commerce Clause.

The case involves Michigan's bottle-deposit law, which requires consumers to pay a ten-cent deposit on a beverage container (like a can or bottle).  Containers sold in Michigan must bear a designation--"MI 10c"--in order to distinguish them from containers sold in other states.  Consumers who return a container with the "MI 10c" designation get a ten-cent deposit back when they return the container.  (Michigan is one of ten states with a bottle-deposit law.)

Some consumers discovered that they could return containers in Michigan that were purchased from states that have no deposit law (that is, non-"MI 10c" containers) and net ten cents on each return.  This was especially easy with "reverse vending machines"--automated return machines that did not distinguish between Michigan containers and out-of-state containers.

The Michigan legislature responded by requiring beverage manufacturers to place a unique mark on Michigan returnable containers (in addition to the "MI 10c" mark) that would allow a reverse vending machine to determine whether the container was, in fact, a Michigan returnable container.  Failure to comply could result in a penalty of up to six months' imprisonment or a $2,000 fine or both.

Manufacturers sued, arguing that the requirement amount to an unconstitutional restraint on interstate commerce in violation of the dormant Commerce Clause.

The Sixth Circuit agreed.  It ruled that while the requirement did not discriminate against interstate commerce (on its face, in its purpose, or in its effect), it did "directly control[] commerce occurring wholly outside the boundaries of a State," and thus was extraterritorial under Healy v. Beer Inst. Inc. (1989).  This doctrine renders extraterritorial regulation "virtually per se invalid under the dormant Commerce Clause."  Op. at 13.

Judge Sutton concurred but wrote separately "to express skepticism about the extraterritoriality doctrine."  Judge Sutton wrote that the doctrine may have outlived its usefulness.

SDS

November 30, 2012 in Cases and Case Materials, Commerce Clause, Dormant Commerce Clause, News, Opinion Analysis | Permalink | Comments (0) | TrackBack (0)

Thursday, February 9, 2012

State FOIA for State Residents Only: Constitutional According to the Fourth Circuit

May a state limit its statutory Freedom of Information Act to "state citizens"? 

Doesn't such a provision violate the Privileges and Immunities Clause of Article IV?  Or the dormant aspect of the commerce clause? 

Not according to the Fourth Circuit. In McBurney v. Young, decided earlier this month, the Fourth Circuit upheld the constitutionality of a Virginia statute that allows access to state records to "to citizens of the Commonwealth, representatives of newspapers and magazines with circulation in the Commonwealth, and representatives of radio and television stations broadcasting in or into the Commonwealth."  Va. Code Ann. § 2.2-3704(A). 

Virginia_new_signThe challengers - - - one a former resident of Virginia with his divorce, child custody, and child support decrees from Virginia and another an information broker dealing in real estate tax assessments - - - argued that the state citizen limitation violated the Privileges and Immunities Clause of Article IV and the information broker also argued the "dormant" aspect of the Commerce Clause, Art. I §8 cl. 3.

The Fourth Circuit affirmed the district judge's rejection of both of these claims.

Regarding Article IV Privileges and Immunities (P&I), the panel opinion admitted that the contours of the P&I Clause are not well-developed, but noted that the "fundamental rights" its encompasses are distinct and "bear upon the vitality of the nation."  With regard to the right to "pursue a common calling," the panel noted that the Virginia statute is not a residency requirement per se: the Virgina FOIA "does not act as a wholesale barrier to entering a business, nor does it establish a license, fee, or other burden to nonresidents entering or engaging in a profession" and on its face it "addresses no business, profession,
or trade."  With regard to the less well-established rights under P&I, such as "equal access to information" or "ability to advance one's interests," the panel found these rights were not established.   Having found no right sufficient to invoke P&I, the panel did not engage in any balancing of state interests and means chosen.

Regarding the dormant commerce clause (DCC), the panel again found that the clause was not properly at issue.  The panel stated that although "the VFOIA discriminates against noncitizens of Virginia, it does not discriminate 'against interstate commerce' or 'out-of-state economic interests.' "  Yet the panel somewhat confusingly added that "[a]ny effect on commerce is incidental and unrelated to the actual language of VFOIA or its citizens-only provision,"  and therefore a Pike balancing analysis, after Pike v. Bruce Church, Inc., 397 U.S. 137 (1970)  is appropriate.  The panel, however, does not engage in any balancing, holding that "the opening brief does not challenge the district court's application of the Pike analysis and thus the argument is waived.

There is something about an open records act being limited to state citizens that seems inconsistent with our notions of a "United States," as well as inconsistent with our notions of openness. The Fourth Circuit's lack of a discussion of the state interests and how they are being served leaves an unfortunate gap, even as  P&I and DCC doctrines do not seem adequate to address the issue.

RR

February 9, 2012 in Dormant Commerce Clause, Opinion Analysis, Privileges and Immunities: Article IV | Permalink | Comments (0) | TrackBack (0)

Thursday, January 26, 2012

Third Circuit: Federal Buy America Act Does Not Preempt State Law

A three-judge panel of the Third Circuit ruled this week in Mabey v. Schoch that the federal Buy America Act and implementing regulations do not preempt Pennsylvania's Steel Act.  Both acts require the use of steel made in the United States for public works projects funded by the federal and state governments, respectively.  But the Buy America Act has broader exceptions, including, importantly, a provision that says that the Act is satisfied when a project "[i]ncludes no permanently incorporated steel or iron materials."

The case arose after the state, citing the state Steel Act, declined to use Mabey's temporary bridge on a project, because Mabey gets its steel from the United Kingdom.  Pennsylvania previously contracted with Mabey, notwithstanding the state Steel Act.  But it apparently changed its policy, decided to enforce the Steel Act against Mabey, and, according to Mabey, forced Mabey to cancel four of its state contracts.

Mabey sued, alleging that exception in the federal Buy America Act preempted the state Steel Act, and that its temporary bridge met the federal Act's provision relating to "no permanently incorporated steel or iron materials."  The Third Circuit rejected this claim.  It ruled that another section of the federal Buy America Act and its regulations, read as a whole, did not clearly reflect congressional intent to preempt; instead, they left room for states to issue more stringent regulations--exactly what Pennsylvania did here.  Thus, the state's Steel Act restrictions applied with their full force to Mabey.

The court also rejected Mabey's Dormant Commerce Clause, Contract Clause, and equal protection claims.  As to the dormant Commerce Clause, the court ruled that the Steel Act fell under the market participant exception (because Pennsylvania was a market participant when it contracted for public works) and, moreover, that Congress authorized Pennsylvania to discriminate against interstate commerce through the federal Buy America Act.  The court said that the state's late-coming enforcement of the Steel Act against Mabey didn't violate the Contract Clause, because the Act was on the books since Mabey started contracting with the state, and the state agency's decision to enforce it didn't amount to "legislative authority subject to scrutiny under the Contract Clause."  And finally the court ruled that the state didn't violate the Equal Protection Clause, because the state's action--first not enforcing, then enforcing, the Steel Act--was rational: "A state agency could rationally determine that application of domestic steel requirements to items used at the discretion of the contractor is too onerous and difficult to enforce."

SDS

January 26, 2012 in Cases and Case Materials, Contract Clause, Dormant Commerce Clause, Equal Protection, Federalism, News, Opinion Analysis, Preemption | Permalink | Comments (0) | TrackBack (0)

Tuesday, November 8, 2011

Nebraska and the Keystone XL Pipeline: State Bills May Have Preemption and Dormant Commerce Clause Issues

Nebraska's location in the "heartland" of the continent makes it an attractive - - - and some would say necessary - - - crossing of the controversial Keystone XL Pipeline transporting crude oil from the Athabasca Oil Sands of Canada's Alberta Province to the refineries of Oklahoma and the Gulf of Mexico states in the US. 

Pipeline-map1Nebraskans, however, may not be so keen to have the pipeline crossing their state.  At the moment, there are no less than 5 bills in the Nebraska legislature that seek to regulate some aspects of the pipeline.  The first, LB1, introduced on Nov 1, was the subject of hearings on November 7. It would create the Major Oil Pipeline Siting Act, defining a major oil pipeline as one greater than six inches in inside diameter and establishing an application process for the routing of a major oil pipeline including public hearings regarding siting proposals and evaluating and approving applications before a company was granted eminent domain rights to build the pipeline.   LB 3 and LB4 as well as LB5 and LB6  also regulate aspects of the pipeline, although somewhat less expansively.  For example, LB6 would require the carrier to file proof of an indemnity bond of $500 million with the Nebraska secretary of state.

Any state law could be preempted by the Pipeline Safety Act, 49 U.S.C. § 60101 et seq., concerning safety of interstate pipeline construction.  However, as the LA Times reports, amid mounting criticism of the federal government's approval of the pipeline, the State "Department’s inspector general's office announced Monday that it was opening an investigation to determine whether the department had complied with federal laws in evaluating the $7-billion project," and that this is "in response to charges by pipeline opponents that builder TransCanada Corp. has improperly influenced what is supposed to be an independent assessment of whether the pipeline is in the national interest and meets U.S. environmental standards."  SEE UPDATE BELOW.

Additionally, any state law could run afoul of the dormant commerce clause.  Nebraska's bills do not seem protectionist per se and seem to be for the legitimate and non-economic purpose of protecting the local environment.  The most applicable case is most likely Kassel v. Consol. Freightways Corp., 450 U.S. 662 (1981), a case populating many constitutional law casebooks and involving Iowa's regulation of the length of tractor trailers.  In Kassel, any discussion of the Iowa regulation's burden on interstate commerce is inextricably tied to Iowa's location and the choices of other surrounding states; recall that Iowa's safety choice appeared less "renegade" when compared to similar regulations in New England as Rehnquist argued in dissent.

Any effort by Nebraska to regulate the XL Pipeline is sure to engender litigation.  The TransCanada Corporation has already made available legal memoranda arguing against the constitutionality of Nebraska regulation.  And arguing for the constitutionality of possible acts by Nebraska, legal memoranda are posted on the site of Bold Nebraska.

UPDATE: 10 November 2011: The State Department has put the XL Pipeline on hold with approval from the White House.

RR

November 8, 2011 in Current Affairs, Dormant Commerce Clause, Federalism, Preemption, Supremacy Clause | Permalink | Comments (0) | TrackBack (0)

Monday, September 27, 2010

Washington High Court Upholds State Internet Gambling Ban

The Washington Supreme Court last week unanimously upheld the state's ban on internet gambling against a Dormant Commerce Clause challenging, ruling that the ban was not "clearly excessive" in relation to legitimate state interests.

The case, Rousso v. State of Washington, involved a Washington statute that criminalizes "the knowing transmission and reception of gambling information by various means, including use of the Internet."  The plaintiff, a Washington would-be gambler, claimed that the statute discriminated against out-of-staters in its effects and that Washington could have achieved its objectives by merely regulating, not completely banning, internet gambling.

The high court disagreed.  In an opinion chock full of deference to the legislature and liberally laced with separation-of-powers and institutional competence concerns, the court ruled that the ban did not discriminate against out-of-staters, either on its face or in effect.  It thus applied the familiar test that an evenhanded law does not violate the Commerce Clause if (1) there is a legitimate state purpose and (2) the burden imposed on interstate commerce is not "clearly excessive" in relation to the law's benefit. 

Here, the state was concerned about gambling addiction, underage gambling, money laundering, and organized crime--clearly legitimate state purposes.  The court ruled that the ban was not "clearly excessive" because any lesser action--regulation of internet gambling, e.g.--would be unduly burdensome and would not similarly achieve the benefits of the ban.  Even though the state regulates, not bans, "brick and mortar gambling operations," similar state regulation of internet gambling "would be an interstate-commerce burdening nightmare."

The court found Minnesota v. Clover Leaf Creamery Co. instructive:

There the Minnesota legislature banned the retail sale of milk in plastic nonreturnable, nonrefillable containers because they presented a solid waste management problem, caused energy waste, and depleted natural resources.  Other nonreturnable, nonrefillable containers, such as ones made from paperboard, raised similar concerns but were not banned. . . .

Even though plastic and paperboard nonreturnable, nonrefillable containers caused the same ultimate ills, the Supreme Court . . . held the ban on plastic containers, which still permitted paperboard containers, was consistent with the dormant commerce clause.

Similarly, here "both brick and mortar gambling and Internet gambling pose many of the same threats to citizens' health, welfare, safety, and morals, yet only the latter is banned."

SDS

September 27, 2010 in Commerce Clause, Dormant Commerce Clause, Federalism, Recent Cases | Permalink | Comments (1) | TrackBack (0)

Tuesday, July 6, 2010

DOJ Files Complaint Against Arizona SB 1070 Alleging Statute Unconstitutional: Analysis

Azdhometitle4 As anticipated, the Department of Justice has filed a complaint in Arizona federal court seeking a declaration and injunction that Arizona SB 1070, the controversial statute signed into law April 23 regarding immigration is unconstitutional.  The DOJ complaint has three causes of action: the supremacy clause, preemption, and the [dormant] commerce clause.  

With the complaint, the DOJ has filed a motion for preliminary injunction and supporting memorandum [available here].  The DOJ memo concentrates on the preemption argument as the basis for the likelihood to prevail on the merits prong of the preliminary injunction standard.  (We've previously discussed the preemption arguments here).  The DOJ argues different types of preemption, including field and conflict:

In enacting a state policy of “attrition through enforcement,” Arizona’s S.B. 1070 ignores every objective of the federal immigration system, save one: the immediate apprehension and criminal sanction of all unlawfully present aliens. See S.B. 1070 § 1. Arizona’s one-size-fits-all approach to immigration policy and enforcement undermines the federal government’s ability to balance the variety of objectives inherent in the federal immigration system, including the federal government’s focus on the most dangerous aliens. By requiring local police officers to engage in maximum inquiry and verification (on pain of civil suit) and by providing for the conviction and incarceration of certain foreign nationals in Arizona for their failure to register, for entering or traveling throughout the state using commercial transportation, or for soliciting work, the “balance” struck by S.B. 1070 is not only different from that of the federal government, but it will interfere with the federal government’s ability to administer and enforce the immigration laws in a manner consistent with the aforementioned concerns that are reflected in the INA. Despite the statute’s self serving claim that it “shall be implemented in a manner consistent with federal laws regulating immigration,” S.B. 1070 § 12, the act mandates a conflicting, Arizona-specific immigration policy – “attrition through enforcement” – and prescribes various provisions that implement that policy in conflict with federal priorities. To permit a hodgepodge of state immigration policies, such as the one Arizona has attempted in S.B. 1070, would impermissibly interfere with the federal government’s balance of uniquely national interests and priorities in a number of ways.

DOJ Memo at 23 (emphasis added).  Additionally, the memo argues that the state law interferes with United States foreign relations and foreign affairs.

The memo also highlights specific provisions of SB 1070 that it argues are preempted. The memo argues sections 2 and 6 are preempted because their mandatory requirements for determining immigration status conflict with federal law and priorities: section 2 will result in the harassment of lawfully present aliens and is therefore at odds with congressional objectives and will "burden federal resources and impede federal enforcement and policy priorities;” section 6 extends Arizona’s “warrantless arrest authority to out-of-state ‘removable’ offenses and is preempted because it will lead to the harassment of aliens.”  Section 3, the “complete or carry an alien registration document” provision is preempted because interferes with comprehensive federal alien registration law and “seeks to criminalize unlawful presence and will result in the harassment of aliens.”  Section 4, amending Arizona’s alien smuggling statute is preempted because it conflicts with federal law.  Section 5, the state criminal sanction against unauthorized aliens who solicit or perform work is preempted by the federal employer sanctions scheme, and the “transporting, harboring, or concealing provision” violates preemption and dormant commerce clause principles (the item of commerce in question being the “alien” him or herself). 

This high-profile complaint joins the other lawsuits filed alleging the unconstitutionality of SB1070, including on equal protection grounds.

{Update: Arizona immigration statute partially enjoined; here}

RR

July 6, 2010 in Commerce Clause, Current Affairs, Dormant Commerce Clause, Federalism, Foreign Affairs, Fundamental Rights, News, Preemption, Race, Supremacy Clause | Permalink | Comments (1) | TrackBack (0)

Friday, October 23, 2009

Of Marriage, Monopolies, and Federalism

Do the states have a marriage monopoly?

Picture 2

That's the intriguing question posed by Adam Candeub and Mae Kuykendall, of Michigan State University College of Law, in their new article,  E-Marriage: Breaking the Marriage Monopoly.

They argue:

States inadvertently have created geographic monopolies, requiring each marriage receiving the benefits of their licensing laws to be performed within their borders. This Article's model builds upon established precedents, such as proxy marriage and choice of law for multi-jurisdictional and internet contracts. Using the power of internet communications, our proposal allows states to compete over marriage's procedures and substance. Depending on a couple's preferences for "e-ritual" and a state's desired level of regulatory control, couples could consume the trappings of a traditional ceremony before their friends and family, without travelling to another jurisdiction, perhaps with an officiant presiding on-line from a remote location. More simply, couples could have a complete marriage ceremony in the location of their choice, but would receive a license and file necessary papers with a distant state jurisdiction.

They are publicizing their proposal with a press release here and article soon to be posted on ssrn here (abstract available now).


RR

October 23, 2009 in Dormant Commerce Clause, Family, Federalism, Scholarship, Sexuality, State Constitutional Law, Travel | Permalink | Comments (0) | TrackBack (0)

Thursday, April 2, 2009

EZ Pass, Dormant Commerce Clause & Equal Protection Right to Travel

Picture 3


As a story in the New York Times reports:

An out-of-state driver crossing Narragansett Bay on the Claiborne Pell Newport Bridge must pay $1.75 with an E-ZPass transponder in the car, but Rhode Islanders, under a resident discount program introduced in January, pay just 83 cents with a transponder. (No break for anyone who pays cash.) Massachusetts has a similar program that reduces the cost of some bridge and tunnel tolls in Boston for those who live nearby.

And New York and New Jersey have similar discounting for state residents.  Such facts, as Con Law students should know, raise "dormant commerce clause" issues as well as a possible equal protection issue.  The NYT story has a link to the complaint filed in Massachusetts.

Could be a nice exam question.

RR

April 2, 2009 in Current Affairs, Dormant Commerce Clause, Fourteenth Amendment, Teaching Tips | Permalink | Comments (0) | TrackBack (0)

Sunday, March 8, 2009

Zelinsky on Davis's Quiet Dormant Commerce Clause Revolution

Professor Edward Zelinsky (Cardozo) just posted on ssrn his very thoughtful take on the Supreme Court's recent turn in its Dormant Commerce Clause jurisprudence, The False Modesty of Department of Revenue v. Davis: Disrupting the Dormant Commerce Clause Through the Traditional Public Function Doctrine.  This extraordinarily well written piece will make good reading for anyone with an interest in recent trends on the Court; but it's a must-read for those of us teaching, learning, and writing about the Dormant Commerce Clause.

Recall that last term's Davis upheld against a Dormant Commerce Clause challenge Kentucky's statute exempting interest on Kentucky municipal bonds--but not interest from other states' municipal bonds--from Kentucky residents' income tax. 

Kentucky's is a familiar kind of law.  In fact, thirty-six other states have laws that mirror Kentucky's, and every other state in the Union supported it at the Court.  Lawyers and bond traders made good arguments that the muni market could fall apart if this near ubiquitous practice were overturned.  Every pragmatic reason seemed to favor upholding the law. 

And yet it seemed plainly to violate the Dormant Commerce Clause, based upon the Court's prior rulings.

The Court in upholding the law seemed to go the pragmatic route.  Or, in Zelinksy's language, "By explicitly deferring to established practices and expectations, Davis is, at first blush, the kind of modest, pragmatic decision advocated today by many including, most prominently, Chief Justice Roberts."

But not so fast, argues Zelinsky.  Rather than being a "modest, pragmatic decision," Davis in reality effected a revolution in the Dormant Commerce Clause by reinvigorating the indeterminate and practically boundless "traditional public function" category.  Zelinsky:

However, on a second look, Davis has broad implications.  Indeed, Davis disrupts the Court's preexisting dormant Commerce Clause doctrine by confirming the Roberts Court's use of the "traditional public function" category to immunize government activity from dormant Commerce Clause scrutiny.  Over two decades ago, in Garcia v. San Antonio Metropolitan Transit Authority, the Supreme Court rejected for Commerce Clause purposes the "traditional public function" doctrine as unworkable.  The Garcia Court's criticism remains persuasive today: There is no principled basis for determining when a government function is old enough to be "traditional" or "public" enough to be public.

As a result, everything a state does--from subsidization of economic development to 529 college savings plans that favor in-state schools--falls into the traditional public function.  Zelinsky shows that this can't be squared with the Court's prior Dormant Commerce Clause rulings, especially those cases treating states' discriminatory taxes as per se unconstitutional.  Zelinsky:

The expansive traditional public function category undermines the Court's prior case law by extending immunity from dormant Commerce Clause scrutiny to all government activity. 

Zelinsky's better solution?  "[B]ite the proverbial bullet and scrap the dormant Commerce Clause test of nondiscrimination."  This is an unworkable test in any event, as demonstrated by the Davis Court's determination to avoid it.

Zelinsky's article is one of those rare gems that is every bit as useful to the novice just delving into the Dormant Commerce Clause as to the expert: The article in laying its foundation patiently details the doctrine; it then presents a serious and important argument on this practically simple case with doctrinally complex implications.  Both foundation and argument should have broad appeal. 

Moreover, Zelinsky's smooth, easy writing makes for pleasurable reading for a wide audience.  I'm delighted to be able to share the piece with Con Law profs, and I look forward to assigning portions to my first-year students.  I highly recommend this article.

SDS

March 8, 2009 in Dormant Commerce Clause, Recent Cases, Scholarship | Permalink | Comments (0) | TrackBack (0)

Saturday, January 17, 2009

Poverty and Con Law - Saturday Evening Review

Even if law students comply with Justice Scalia's widely reported remark last year admonishing them not to enroll in waste-of-time courses such as "Law and Poverty," it might not be sufficient to insulate students from the legal problems of poverty - - - at least if ConLawProf Stephen Loffredo has his way.

As part of a Symposium entitled "What Is the Place of Poverty Law in the Law School CurricuLoffredolum?: Looking Back and Planning for the Future," Loffredo confronted the "place" of poverty in a traditional Constitutional Law Structures course.  In his article, Poverty, Inequality, and Class In The Structural Constitutional Law Course, 34 Fordham Urb. L.J. 1239 (2007),  Loffredo admits that the relevance of poverty issues are more readily apparent in the "rights" portion (or separate course) of Constitutional Law courses, but argues that while not always apparent, legal issues of poverty and economic inequality are integral to constitutional structures courses. 

Most helpfully, Loffredo offers some very specific suggestions about integrating issues of poverty and class inequality.  His discussion of "the founding" and judicial review principles in Marbury v. Madison and after is especially noteworthy.  For example, Loffredo highlights a possible area of discussion:

students might be asked to consider whether the counter-majoritarian critique operates in the same way when litigants without access to economic power, and therefore little access to the political process, seek assistance from the courts.  If people living in poverty lack a democratically fair share of political access--if the ordinary channels of civic and political engagement are not open to them, so that courts are the only meaningful avenue or effective point of access--then perhaps the availability of judicial redress and the institution of judicial review in those cases does not deviate from democratic practice at all, but serves as a corrective that enhances democracy.

More provocative, perhaps, is Loffredo's suggestions regarding the dormant commerce clause.  Loffredo candidly states that a notion that "the Commerce Clause has anything to say about treatment of poor people may come as a surprise to students," and perhaps some ConLawProfs.  Here, Loffredo's suggestion is not so much about directing student discussion as about including different material.  He suggests that " a key, though largely neglected,"  dormant commerce clause case, Edwards v. California, 314 U.S. 160 (1941), "speaks eloquently to the issues of poverty, inclusion, and national community, and provides a window into the shifting judicial understandings of poor people and the nation's responsibility for the economic well-being of its citizens."   His  extended argument for the then-relevance and the continued relevance of Edwards is quite convincing. 

Loffredo also has suggestions for the Eleventh Amendment, Congressional power under section 5 of the Fourteenth Amendment, and even Martin v. Hunter's Lessee. These are all worth considering. Most of Loffredo's suggestions do not require retooling the Syllabus, but offer thoughts for teaching the structural dimensions of Constitutional Law to include poverty law issues.

These suggestions may be more timely now than when written.  In some of the article's introductory passages, Loffredo observes that the norm has become obscuring economic inequality and class issues throughout Constitutional Law and the law school curriculum.  Could it be that these observations are becoming less true at the beginning of 2009 given various changes in the political and economic climate?  All the more reason to consider Loffredo's suggestions.

RR

January 17, 2009 in Dormant Commerce Clause, Eleventh Amendment, Interpretation, Scholarship, Teaching Tips | Permalink | Comments (0) | TrackBack (0)