Monday, November 3, 2008

More dormant Commerce Clause questions

From my e-mail inbox over the weekend:

Question: In the Dean Milk case, we discussed alternative methods to achieving the state interest. One of the non-discriminatory alternatives was merely increasing the cost of milk to represent the true cost of the extra inspection. Is the essential difference between the two (the alternative we discussed and the actual law) the fact that the law coerces or mandates the milk in Madison to be only of local farmers or pasteurizers, whereas the alternative is an economic or market justification?

Answer: Yes and no. I would say that the difference is that Madison's law discriminated against interstate commerce (as it flatly barred milk based on geographic origin), whereas the alternative you mention did not. To be clear, the alternative you reference was to charge each seller of milk the actual cost to the City of Madison of inspecting their processing plants. This might naturally be a bit more for out-of-state producers, given the additional transportation costs. But the law would be non-discriminatory. All sellers would simply be forced to reimburse the City for the incurred inspection costs.

Question: In the Washington Apple case, where we discussed discrimination in affect and purpose, we established that the law was certainly discriminatory in practical effect. At the end of the case, you alluded you a point, and forgive me if I totally butchered it, but something along the lines of: If a law is found to have such a discriminatory affect, as in this case, to force the Washington apple producers to lose out in their competitive advantage, we can easily infer that the purpose of the law had to have been discriminatory. Is that how we determine discrimination in purpose?

Answer: Again, yes and no. I think in this particular case it was not so difficult to infer, especially when the proffered justifications by the North Carolina legislature rang so hollow. But this will not be true in every case. Again, as Exxon shows, a mere disparate impact on interstate commerce is insufficient to show discrimination in practical effect for purposes of the dormant Commerce Clause.

Question: How do we know if an interest is legitimate? From my understanding, it takes a examination of what the law is seeking to protect on its face but is there more to it, such as a test to apply?

Answer: There is no simple answer to this question, as it varies by context. With respect to the dormant Commerce Clause, almost any conceivable public interest is legitimate other than protecting the economic interests of the state's residents, or a subset of the state's residents. This is economic protectionism, and it is precisely what the dormant Commerce Clause seeks to forbid. Recall, though, that this is a perfectly legitimate interest if the state is acting as a market participant. Moreover, as we will see when we examine the Due Process Clause in the next few weeks, protecting the state's economic interests would be a legitimate interest for purposes of due process. So, what is legitimate depends on the context in which the question is raised.