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New State Ice Co. v. Liebmann
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| New State Ice Co. v. Liebmann | |
| Reference: 285 U.S. 262 | |
| Term: 1932 | |
| Important Dates | |
| Argued: February 19, 1932 Decided: March 21, 1932 | |
| Outcome | |
| United States Court of Appeals for the Tenth Circuit affirmed | |
| Majority | |
| George Sutherland • Charles E. Hughes • Willis Van Devanter • James Clark McReynolds • Pierce Butler • Owen Josephus Roberts | |
| Dissenting | |
| Louis Brandeis • Harlan Fiske Stone | |
New State Ice Co. v. Liebmann is a case decided on March 21, 1932, by the United States Supreme Court holding that state licensing requirements on businesses violated the Due Process Clause of the Fourteenth Amendment of the U.S. Constitution. The case concerned the constitutionality of an Oklahoma state law that prohibited the manufacture and sale of ice without a license. The Supreme Court affirmed the ruling of the United States Court of Appeals for the Tenth Circuit.[1][2][3]
Why it matters: The Supreme Court's decision in this case established that states could not enact licensing requirements on businesses. To read more about the impact of New State Ice Co. v. Liebmann click here.
Background
The state of Oklahoma enacted a law in 1925 that prohibited the manufacture and sale of ice without a license on the grounds that it was a public business. The law also prohibited the issuance of new ice licenses under most circumstances.
The New State Ice Company sued Liebmann for selling ice without a license. Liebmann appealed, arguing that the law was unconstitutional under the Due Process Clause of the Fourteenth Amendment because it prohibited him from engaging in lawful business practices. The district court dismissed the ice company's lawsuit, which was sustained by the United States Court of Appeals for the Tenth Circuit.[1][2]
Oral argument
Oral argument was held on February 19, 1932. The case was decided on March 21, 1932.[1]
Decision
The Supreme Court decided 6-2 to affirm the decision of the United States Court of Appeals for the Tenth Circuit. Justice George Sutherland delivered the opinion of the court. Justice Louis Brandeis wrote a dissenting opinion, joined by Justice Harlan Fiske Stone. Justice Benjamin Nathan Cardozo did not participate in the case.[1]
Opinions
Opinion of the court
Justice George Sutherland, writing for the court, argued that the Oklahoma law was aimed at protecting large ice companies. Sutherland contended that the law established a monopoly on the ice business, which was outside of the scope of the state's authority.[1]
| “ | Stated succinctly, a private corporation here seeks to prevent a competitor from entering the business of making and selling ice. It claims to be endowed with state authority to achieve this exclusion. There is no question now before us of any regulation by the State to protect the consuming public either with respect to conditions of manufacture and distribution or to insure purity of product or to prevent extortion. The control here asserted does not protect against monopoly, but tends to foster it. The aim is not to encourage competition, but to prevent it; not to regulate the business, but to preclude persons from engaging in it. There is no difference in principle between this case and the attempt of the dairyman under state authority to prevent another from keeping cows and selling milk on the ground that there are enough dairymen in the business; or to prevent a shoemaker from making or selling shoes because shoemakers already in that occupation can make and sell all the shoes that are needed. We are not able to see anything peculiar in the business here in question which distinguishes it from ordinary manufacture and production. It is said to be recent; but it is the character of the business, and not the date when it began, that is determinative. It is not the case of a natural monopoly, or of an enterprise in its nature dependent upon the grant of public privileges. The particular requirement before us was evidently not imposed to prevent a practical monopoly of the business, since its tendency is quite to the contrary. Nor is it a case of the protection of natural resources. There is nothing in the product that we can perceive on which to rest a distinction, in respect of this attempted control, from other products in common use which enter into free competition, subject, of course, to reasonable regulations prescribed for the protection of the public and applied with appropriate impartiality.[4] | ” |
| —George Sutherland, majority opinion in New State Ice Co. v. Liebmann[1] | ||
Dissenting opinion
Justice Louis Brandeis, in a dissenting opinion joined by Justice Harlan Fiske Stone, argued that states should have the right to experiment with policy without interference from the federal government.[1]
| “ | To stay experimentation in things social and economic is a grave responsibility. Denial of the right to experiment may be fraught with serious consequences to the nation. It is one of the happy incidents of the federal system that a single courageous State may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country. This Court has the power to prevent an experiment. We may strike down the statute which embodies it on the ground that, in our opinion, the measure is arbitrary, capricious, or unreasonable. We have power to do this, because the due process clause has been held by the Court applicable to matters of substantive law as well as to matters of procedure. But, in the exercise of this high power, we must be ever on our guard lest we erect our prejudices into legal principles. If we would guide by the light of reason, we must let our minds be bold.[4] | ” |
| —Louis Brandeis, dissenting opinion in New State Ice Co. v. Liebmann[1] | ||
Impact
| Federalism |
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| •Key terms • Court cases •Major arguments • State responses to federal mandates • Federalism by the numbers • Index of articles about federalism |
- See also: Laboratories of democracy
New State Ice Co. v. Liebmann established that states could not enact licensing requirements for businesses. The decision in this case prohibited states from intervening in business to establish monopolies.[1]
The decision in New State Ice Co. v. Liebmann has been superseded by other decisions that refrain from relying on the Due Process Clause to review economic legislation.[3]
See also
External links
- Full text of case syllabus and opinions (Justia)
- Supreme Court of the United States
- Search Google News for this topic
Footnotes
- ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 Justia, "New State Ice Co. v. Liebmann, 285 U.S. 262 (1932)," accessed October 4, 2022
- ↑ 2.0 2.1 LexisNexis, "New State Ice Co. v. Liebmann - 285 U.S. 262, 52 S. Ct. 371 (1932)," accessed October 4, 2022
- ↑ 3.0 3.1 Center for the Study of Federalism, "New State Ice Company v. Liebmann (1932)," accessed October 4, 2022
- ↑ 4.0 4.1 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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