Kidd v. Pearson
128 U.S. 1, 9 S. Ct. 6, 1888 U.S. LEXIS 2193 (1888)
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Rule of Law:
A state's police power to regulate the health, safety, and morals of its citizens allows it to prohibit the manufacture of a product within its borders, even if that product is intended exclusively for export to other states. The act of manufacturing is a local activity, not interstate commerce, and thus falls outside the regulatory scope of the federal Commerce Clause.
Facts:
- Iowa enacted a statute that prohibited any person from manufacturing or selling intoxicating liquors within the state.
- The statute provided narrow exceptions, allowing for the manufacture of liquors to be sold within the state for specific mechanical, medicinal, culinary, or sacramental purposes.
- The statute did not contain an exception for the manufacture of liquors intended for transportation and sale outside of Iowa.
- Kidd owned and operated a distillery in Polk County, Iowa.
- Kidd manufactured intoxicating liquors at his distillery.
- Kidd intended to export the entirety of the manufactured liquor for sale in other states.
Procedural Posture:
- A legal action was initiated in an Iowa state trial court to have Kidd's distillery declared a public nuisance and its operation enjoined under the state's prohibition statute.
- The Iowa trial court found for the state, upholding the statute's application to Kidd's distillery.
- Kidd, the defendant, appealed the trial court's decision to the Supreme Court of Iowa, the state's highest court.
- The Supreme Court of Iowa affirmed the lower court's ruling, holding that the state statute was a valid exercise of police power and did not conflict with the federal Constitution.
- Kidd, as plaintiff in error, then sought a writ of error from the Supreme Court of the United States to review the judgment of the Supreme Court of Iowa.
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Issue:
Does a state statute that prohibits the manufacture of intoxicating liquors, including for the purpose of exportation to other states, violate the Commerce Clause of the U.S. Constitution?
Opinions:
Majority - Justice Lamar
No. The Iowa statute does not violate the Commerce Clause because it regulates manufacturing, an activity that is distinct from and precedes interstate commerce. The court established a clear distinction between manufacture and commerce: manufacture is the local activity of transforming raw materials, whereas commerce consists of the buying, selling, and transportation of goods between states. A state's police power is plenary over local activities, and it may regulate or prohibit production within its borders to protect its citizens. The mere intent of the manufacturer to export goods does not transform the local act of production into an article of interstate commerce. Citing Coe v. Errol, the court reasoned that goods do not enter the stream of interstate commerce until they are shipped or committed to a common carrier for transport to another state. To hold otherwise would grant Congress regulatory power over all productive industries, such as agriculture and mining, which would paralyze state governments and upend the constitutional design.
Analysis:
This decision established the foundational principle that manufacturing is not commerce, thereby creating a significant sphere of economic activity reserved for state regulation under the doctrine of dual federalism. It severely limited the reach of the federal Commerce Clause power by drawing a bright line between local production and interstate trade. This 'manufacturing is not commerce' doctrine would serve as a major constitutional barrier to federal economic regulation for decades, most notably against New Deal legislation, until it was eventually abandoned in favor of a broader 'substantial effects' test in cases like NLRB v. Jones & Laughlin Steel Corp. and Wickard v. Filburn.
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