Gibbons v. Ogden

A New York statute granted the exclusive right to navigate by steamboat between NYC and Elizabethtown, NJ to Livingston and Fulton, who in turn conveyed the right to Ogden (P).

Gibbons (D) also operated boats along P’s route. D’s boats were licensed in the coasting trade under the federal Coasting Act. P sought and obtained a state court injunction prohibiting D’s operation. D appeals, claiming the power of Congress to regulate interstate commerce under the Commerce clause is exclusive.

Sidebar: Aaron Ogden (governor of New Jersey 1812 - 1813) gave legal advice to the wife of Thomas Gibbons (mayor of Savannah, Georgia 1799 - 1801) to divorce him.

Ogden (with New York state license) sued Gibbons (with the federal license) in the New York Court of Chancery.

The New York chancellor granted an injunction to prevent Gibbons from operating his steamboat in New York coastal waters.

Is state regulation of commercial navigation that excludes federally licensed operators constitutional?

The state of New York can't grant a monopoly to former New Jersey governor Odgen.

Gibbons wins.

The Supreme Court held that commerce includes

1. production
2. manufacture
3. transportation (pertinent to this case)
4. sale.

Judgment reversed.

Concurrence: Creation of a federal power over commerce was one of the main purposes of adopting the Constitution. This power must be exclusive.

Notes:

• Plaintiff admits that Congress has the power to regulate commerce with foreign nations among the several states, but would limit the meaning of “commerce” to traffic (buying and selling) or the interchange of commodities, and would exclude navigation. But one of the primary objects of the creation of the federal government was to grant the power over comer, including navigation/
• The commerce power of Congress must be exercised within the territorial jurisdiction of the states, even though it cannot reach solely intrastate commerce. The power of Congress does not stop at the boundary lines of a state; it follows interstate commerce into the territory of a state.
  • The commerce power and the power to regulate it is a complete power—no limitations
  • Limited areas of control but those areas are plenary
• P attempts to analogize between the taxing power and the commerce power, claiming that since the taxing power is concurrent, the commerce power should be. But regulation of interstate commerce is an exclusive federal power. When a state regulates commerce with foreign nations or among the several states, it exercises the very power granted to Congress, and the analogy fails.
• State inspection laws are recognized in the Constitution, but do not derive from a power to regulate commerce. They act upon the subject before it becomes an article of foreign commerce.
• D has been granted, through a federal license, the privilege of employment in the coasting trade. P would restrict such trade to property transport, excluding passengers. Such a narrow interpretation would eventually "explain away the Constitution." Instead, safe and fundamental principles must be followed, and coasting trade includes transport of both property and persons for hire.
• For these reasons, the federal license must be recognized, and state laws prohibiting exercise of such licenses are void.

• United States v. Darby Lumber Co.