Stafford v. Wallace
258 U.S. 495, 42 S. Ct. 397, 1922 U.S. LEXIS 2296 (1922)
Rule of Law:
Under the Commerce Clause, Congress has the authority to regulate local, intrastate activities that are an integral part of a continuous 'current' or 'stream' of interstate commerce.
Facts:
- Livestock was typically raised on farms and ranges in Western and Southwestern states.
- This livestock was transported via interstate rail to major stockyards in cities like Chicago and Omaha.
- At the stockyards, the livestock was sold by commission men to dealers, local butchers, or large meat-packing companies.
- After being sold, the livestock was either slaughtered and processed into meat products by packers for shipment to consumers in Eastern states, or shipped to other states for fattening.
- Congress found that the largest meat packers had formed a monopoly, using their control over the stockyards to manipulate prices, engage in deceptive practices, and burden the flow of livestock and meat products across state lines.
- In response, Congress passed the Packers and Stockyards Act of 1921 to regulate packers, stockyard owners, and commission men.
- The Secretary of Agriculture, pursuant to the Act, required stockyard operators and commission men, including Stafford, to register and adhere to federal regulations.
- Stafford, a commission man, engaged in the business of buying and selling livestock at the Union Stock Yards in Chicago.
Procedural Posture:
- Stafford and other dealers sued the Secretary of Agriculture, Henry Wallace, in the U.S. District Court for the Northern District of Illinois.
- The plaintiffs sought an injunction to prevent the enforcement of the Packers and Stockyards Act of 1921, arguing it was unconstitutional.
- The District Court, acting as a three-judge panel, denied the plaintiffs' request for interlocutory injunctions.
- Stafford, as the appellant, filed a direct appeal to the Supreme Court of the United States.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the Packers and Stockyards Act of 1921, which regulates the business practices of commission men and dealers at stockyards, exceed Congress's regulatory authority under the Commerce Clause?
Opinions:
Majority - Chief Justice Taft
No, the Packers and Stockyards Act of 1921 is a constitutional exercise of Congress's power under the Commerce Clause. The business activities conducted at stockyards are not isolated, local transactions but are an essential part of a continuous 'stream of commerce.' The stockyards function as a throat through which the current of livestock flows from western states to eastern consumers. Transactions within the stockyards are indispensable incidents to this interstate movement. Citing the precedent established in Swift & Co. v. United States, the Court reasoned that Congress has the power to regulate such local activities to prevent obstructions and burdens on the free flow of interstate commerce. The potential for price manipulation and deceptive practices at these critical points directly threatens and burdens the national commercial current, justifying federal oversight.
Dissenting - Justice McReynolds
Justice McReynolds dissented without providing a written opinion.
Analysis:
This case significantly solidified and expanded the 'stream of commerce' doctrine, empowering Congress to regulate activities that, while geographically local, are functionally part of a continuous interstate economic process. The decision provided a crucial precedent for extending federal authority over key points in national supply chains, laying the groundwork for much of the New Deal-era economic legislation. By focusing on the practical course of business rather than on technical distinctions between intrastate and interstate activities, the Court broadened the scope of the Commerce Clause. This ruling makes it more difficult to challenge federal regulation of any industry where goods or services flow across state lines through central hubs or processing points.
Gunnerbot
AI-powered case assistant
Loaded: Stafford v. Wallace (1922)
Try: "What was the holding?" or "Explain the dissent"