Also known as: economic activities
Written by attorneys — see sources below.
Conduct that is commercial or productive in nature. Such conduct falls within Congress's commerce power when the activity, viewed in the aggregate across similarly situated actors, substantially affects interstate commerce.
Edgar Evers keeps a handgun locked in his vehicle while parked at a public high school in his home state. Federal prosecutors charge him under a statute banning firearms in school zones. The possession involves no sale, purchase, or other commercial transaction and occurs entirely within one state.
Edward Everett assaults Emma Erickson after a social encounter in their shared hometown. Erickson sues under a federal civil remedy for gender-motivated violence. The assault involves no economic exchange or market participation by either party.
In September 1994 Christy Brzonkala enrolled as a student at Virginia Polytechnic Institute and State University. Within thirty minutes of meeting fellow students Antonio Morrison and James Crawford, both members of the varsity football team, Brzonkala alleges that the two men assaulted and repeatedly raped her. Morrison allegedly told Brzonkala after the attack that she had better not have any diseases. He later announced in a dormitory dining room that he liked to get girls drunk and made other vulgar remarks about women. Brzonkala became severely emotionally disturbed and depressed after the incident. She sought assistance from a university psychiatrist who prescribed antidepressant medication. She stopped attending classes and withdrew from the university. In early 1995 she filed a complaint against Morrison and Crawford under the university's Sexual Assault Policy. Virginia Tech conducted a hearing under its Sexual Assault Policy and a second hearing under its Abusive Conduct Policy. The first found Morrison guilty of sexual assault and suspended him for two semesters. The second hearing again found him guilty but changed the offense description to using abusive language. University officials later set aside the punishment. In December 1995 Brzonkala sued Morrison, Crawford, and Virginia Tech in the United States District Court for the Western District of Virginia. Her complaint alleged that the attack violated 42 U.S.C. §13981, the civil remedy provision of the Violence Against Women Act of 1994, which creates a federal cause of action for compensatory and punitive damages against persons who commit crimes of violence motivated by gender. She also asserted Title IX claims against the university. The district court dismissed the Title IX claims for failure to state a claim. It also dismissed the §13981 claim on the ground that Congress lacked authority to enact the provision under either the Commerce Clause or Section 5 of the Fourteenth Amendment. A divided panel of the Fourth Circuit reversed in part, but the en banc Fourth Circuit affirmed the district court's conclusion that Congress lacked constitutional authority to enact §13981. The Supreme Court granted certiorari to determine the constitutionality of the civil remedy provision.
View caseEdgewater Capital, a regulated electric utility, runs promotional advertisements encouraging greater electricity use. State regulators prohibit the ads to promote conservation. The advertising directly promotes commercial sales by the utility in its service territory.
In December 1973, the Public Service Commission ordered electric utilities in New York State to cease all advertising that promoted the use of electricity because the interconnected utility system lacked sufficient fuel stocks for the 1973-1974 winter. The order rested on the Commission's finding that the system did not have sufficient fuel stocks or sources of supply to meet customer demands. Three years later, when the fuel shortage had eased, the Commission requested comments from the public on its proposal to continue the ban on promotional advertising. Central Hudson Gas & Electric Corp. opposed the ban on First Amendment grounds. After reviewing the public comments, the Commission extended the prohibition in a Policy Statement issued on February 25, 1977. The Policy Statement divided advertising expenses into promotional and institutional categories. It permitted informational advertising designed to encourage shifts of consumption from peak demand times to periods of low electricity demand. The Commission banned promotional advertising because additional electricity would be more expensive to produce and promotional advertising would give misleading signals to the public. Central Hudson challenged the order in state court. The order was upheld through the New York Court of Appeals. The Supreme Court noted probable jurisdiction and reversed.
View caseEdith Eberhardt photographs minors engaged in sexual conduct and sells the images to out-of-state buyers. Prosecutors charge her under a state statute targeting such material. The production and distribution constitute commercial transactions in an interstate market.
In 1977 the New York Legislature enacted Article 263 of the Penal Law. Section 263.15 makes it a class D felony for any person, knowing the character and content of the material, to produce, direct, or promote any performance that includes sexual conduct by a child less than sixteen years of age. Sexual conduct is defined to encompass actual or simulated sexual intercourse, deviate sexual intercourse, sexual bestiality, masturbation, sado-masochistic abuse, or lewd exhibition of the genitals. Promote is defined to include selling, distributing, or advertising such material. Paul Ferber operated a Manhattan bookstore that specialized in sexually oriented products. He sold two films to an undercover police officer. The films were devoted almost exclusively to depicting young boys masturbating. Ferber was indicted on two counts of violating § 263.15 and two counts of violating the companion provision § 263.10 that requires the material to be obscene. After a jury trial, Ferber was acquitted of the two obscenity counts under § 263.10 but convicted on the two counts under § 263.15. The Appellate Division of the New York Supreme Court affirmed the convictions without opinion. The New York Court of Appeals reversed, holding that § 263.15 violated the First Amendment because it reached material that would not be obscene under Miller v. California. The Supreme Court granted certiorari to review the constitutionality of the New York statute.
View caseEnzo Eastwood declines to purchase health insurance despite having sufficient income. Congress imposes a monetary exaction collected through tax returns for failing to maintain coverage. The decision not to buy insurance affects national markets for health care services and financing.
In 2010 Congress enacted the Patient Protection and Affordable Care Act containing hundreds of provisions across ten titles. The Act requires most Americans to maintain minimum essential health insurance coverage beginning in 2014 or else make a shared responsibility payment calculated as a percentage of household income subject to a floor and ceiling. The Act also expands Medicaid by requiring participating states to cover adults with incomes up to 133 percent of the federal poverty level while increasing federal funding but threatening loss of all Medicaid funds for noncompliance. On the day the President signed the Act Florida and twelve other states filed suit in the United States District Court for the Northern District of Florida challenging the individual mandate provisions under Article I. The original plaintiffs were later joined by eighteen additional states several individuals and the National Federation of Independent Business. The District Court held that the individual mandate exceeded congressional power and could not be severed from the remainder of the Act so it struck down the entire statute. The Court of Appeals for the Eleventh Circuit affirmed that the individual mandate exceeded congressional power but held the provision severable from the rest of the Act while unanimously upholding the Medicaid expansion. Other courts of appeals reached conflicting results on the mandate with the Sixth Circuit and the D.C. Circuit upholding it under the commerce power and the Fourth Circuit applying the Anti-Injunction Act to bar review. The Supreme Court granted certiorari to review the Eleventh Circuit judgment on both the individual mandate and the Medicaid expansion and appointed amici curiae to address severability and the Anti-Injunction Act. The penalty for noncompliance with the individual mandate first becomes enforceable in 2014. The present suit seeks to restrain its future collection. The Act describes the payment as a penalty rather than a tax. It directs that the payment be assessed and collected in the same manner as taxes but bars the IRS from using criminal prosecutions or levies to enforce it.
View caseEmpire Logistics purchases raw timber from state lands in Alaska and seeks to process it out of state. State rules require in-state processing before export. The purchase and intended processing constitute commercial transactions in the timber market.
In September 1980 the Alaska Department of Natural Resources published notice of a sale of approximately 49 million board-feet of timber near Icy Cape, Alaska, scheduled for October 23, 1980. The notice, prospectus, and proposed contract all required primary manufacture of the timber within Alaska before export under 11 Alaska Admin. Code § 76.130 (1974). Primary manufacture meant converting logs into cants slabbed on at least one side and either sawed to a maximum thickness of 12 inches or squared on four sides along their entire length. The State imposed the condition by contract and charged a significantly lower price for the timber. South-Central Timber Development, Inc., an Alaska corporation, purchases standing timber, logs it, and ships unprocessed logs almost exclusively to Japan. The company does not operate a mill in Alaska and customarily sells unprocessed logs. When it learned that the primary-manufacture requirement would apply to the Icy Cape sale, South-Central filed suit in federal district court seeking an injunction. The district court agreed that the requirement violated the Commerce Clause and issued an injunction. The Court of Appeals for the Ninth Circuit reversed, concluding that federal policy on timber from federal lands in Alaska supplied implicit congressional authorization for the state requirement. The Supreme Court granted certiorari. Since 1928 the Secretary of Agriculture has restricted export of unprocessed timber from National Forest lands in Alaska. The current regulation, 36 CFR § 223.10(c) (1983), prohibits shipment of unprocessed timber from those lands to other states or foreign countries without prior approval of the Regional Forester to ensure development of wood-processing capacity in Alaska. Congress has also imposed a series of annual riders to appropriation Acts creating export limitations on unprocessed timber from western federal lands, including complete bans on foreign exports except from Alaska.
View caseIntrastate production qualifies when it is commercial or productive in nature and, in the aggregate, substantially affects interstate commerce. Growing wheat for on-farm use or 3D-printing components that replace out-of-state purchases both count because each substitutes for market transactions and alters national supply or demand.
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Non-economic activity lacks the commercial character that permits aggregation. Gun possession in a school zone and gender-motivated violence involve no market transaction, so their effects cannot be summed across instances to create a substantial effect on interstate commerce.
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The requirement focuses on regulatory measures that reach intrastate conduct. A monetary exaction collected through tax returns may still be upheld as a tax if it raises revenue, even when the underlying conduct is not itself economic activity subject to direct regulation.
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…under the Commerce Clause to enact § 922(q). First, we have upheld a wide variety of congressional Acts regulating intrastate economic activity where we have concluded that the activity substantially affected interstate commerce. See, e. g., Hodel v. Virginia Surface Mining & Reclamation Assn., Inc. , 452 U. S. 264 (1981); Perez…