Business and the Constitution

Chapter 4

The Constitutional Powers of Government

• Before the Revolutionary War, States wanted a confederation with weak national government and very limited powers.

The Constitutional Powers of Government

• After the war ended, the States voted to create a new, federal government that shared power with States.

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The Constitutional Powers of Government

• Regulatory Powers of States.–10th Amendment.–Police Powers: order, safety, morals–Federalism

The Constitutional Powers of Government

• The Supremacy Clause and Federal Preemption.– In case of direct conflict between state and federal

law, state law is invalid.

The Constitutional Powers of Government

• The Supremacy Clause and Federal Preemption.– A valid federal statute or regulation will take

precedence over a conflicting state or local statute.

The Constitutional Powers of Government

• The Supremacy Clause and Federal Preemption.– Preemption occurs when Congress chooses to act

exclusively when national and state governments have concurrent powers

Constitutional Law and The Commerce Clause

• Article I, Section 8 of the U.S. Constitution empowers Congress “[t]o regulate Commerce with foreign nations, and among the several States, and with the Indian Tribes.”

The Commerce Clause

• Interstate commerce is commerce between two or more states.

• Intrastate commerce is commerce within a single state.

The Commerce Clause

• The “Dormant” Commerce Clause.– Generally, federal government has exclusive

authority to regulate commerce that substantially affects trade among the states

The Commerce Clause

Since 1824 (Gibbons vs. Ogden at p. 12), the Supreme Court has interpreted the Commerce Clause to permit Congress to regulate both interstate and intrastate commerce that “substantially affects” interstate commerce.

The Commerce Clause

What laws have been based on the Commerce Clause?

• Fair Labor Standards Act• Food and Drug Laws• Clean Air and Clean Water Acts• Civil Rights Acts (Heart of Atlanta Motel V.

U.S. p. 12 of book)

The Commerce Clause

Heart of Atlanta Motel vs United States (case 1.1 in book at page 12)

similar to Katzenbach vs. McClung• Upheld Civil Rights Acts

– Non-discrimination in public accommodations– Non-discrimination in restaurants

The Bill of Rights• The first 10 amendments to the U.S.

Constitution comprise the Bill of Rights—a series of protections for individuals against various types of government action.

The Bill of Rights• Guarantees freedom of religion, speech, and

the press, the right to peaceably assemble, and to petition the government. [Amend. 1]

Bill of Rights

• Restriction on commercial speech is valid as long as the restriction:

-seeks to promote a substantial government interest;

-directly advances that government interest; and

-goes no further than necessary to accomplish its objective

The Bill of Rights• Case involving state

law prohibiting the “bad frog” making obscene gesture on label of beer vis-à-vis freedom of speech (page 19)

The Bill of Rights• Guarantees the right to keep and bear arms.

[Amend. 2]• Prohibits unreasonable searches and

seizures of persons or property. [Amend. 4]

The Bill of Rights• Guarantees the rights to due process of law,

being free from self-incrimination, and indictment by grand jury. [Amend. 5]

• Guarantees the rights to a speedy and public (criminal) trial with the assistance of counsel and to cross-examine witnesses and to solicit favorable testimony. [Amend. 6]

The Bill of Rights• Guarantees the right to trial by jury in both

criminal cases, [Amend. 6] and civil cases involving more than $20 [Amend. 7]

• Prohibits excessive bail and fines and cruel and unusual punishment. [Amend. 8]

Incorporation of Bill of Rights• The protections afforded by the Bill of

Rights only apply to action by the federal government.

• The U.S. Supreme Court applied them to state and local governments by incorporating the protections of the Bill of Rights into the 14th Amendment.

Incorporation of Bill of Rights• The Court used the 14th Amendment to

incorporate the Bill of Rights to apply to states and local governments:– “. . . . No State shall make or enforce any law which

shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.”

Due Processand Equal Protection

Due Process. Procedural Due Process: any government decision to

take life, liberty or property must be fair. –Requires: Notice and Fair Hearing.

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Due Processand Equal Protection

Due Process. Substantive Due Process: focuses on the content

(the right itself).–Fundamental Right: requires compelling state

interest.–Non-Fundamental: rational relationship to state

interest.

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Due Processand Equal Protection

Equal Protection.– Government must treat similarly situated

individuals (or businesses) in the same manner.

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Rights to Privacy

Not Specifically Mentioned in Constitution• Developed in 20th Century through Courts

using the 9th Amendment– Griswold vs. Connecticut in 1965

• Also the Subject of Statutory Laws

Business and the Constitution

End of Chapter 4