Constitutional Authority to Regulate Business

• 1787 US Constitution creates federal form of government

• Delegated powers

• Partnership w/exceptions

• 3 Branches = Checks and balances

Constitutional Authority to Regulate Business

• The Commerce Clause– Art. I Sect. 8 – Gibbons v. Ogden Broad Interpretation– US v. Lopez only limiting case

• Regulatory Powers of States– Police powers- protect or promote the public order,

health, safety, morals, general welfare– Presumed valid when conflict occurs– Raymond Motor & Oregon Waste Systems

Constitutional Authority to Regulate Business

• The Supremacy Clause– Art. VI and Preemption– Pervasive, comprehensive, detailed

• Taxing and Spending Powers– Art. I Sec. 8– Reasonable relationship test to sustain tax– Policy choices

Constitutional Authority to Regulate Business

• Business and the Bill of Rights– Adopted in 1791– Legal person status– Supremes interpret (so Vote!)

Constitutional Authority to Regulate Business

• First Amendment– Freedom of Speech

• Political speech, symbolic speech McIntyre v. Ohio Elections Commission

– Commercial Speech• Valid if it seeks to implement a substantial

government interest, directly advances that interest, and goes no further than necessary to accomplish its objective Rubin v. Coors

Constitutional Authority to Regulate Business

• First Amendment– Corporate Political Speech

• First National Bank of Boston v. Bellotti

– Unprotected Speech• Defamatory speech

• Threatening speech

• Pornography

• Fighting words

• Obscene speech Robinson v. Jacksonville Shipyards

Constitutional Authority to Regulate Business

• First Amendment– Freedom of religion

• Separation of church and state/Establishment Clause– No state sponsored religions

– No endorsement or preference

– Secular purpose of rest days?

– Accommodate all, hostility toward none

• Free exercise of religion – Compelling state interest test

Constitutional Authority to Regulate Business

• Fourth Amendment– The right of the people to be secure in their

persons, houses, papers and effects. • Search warrants based on reasonable

grounds/probable cause must be obtained from neutral third party

• Requires a particular description

• Exceptions: highly regulated businesses

Constitutional Authority to Regulate Business

• Fifth Amendment

– No person shall be compelled in any criminal case to be a witness against himself

– Does not apply to corporations or partnerships

Constitutional Authority to Regulate Business

• Other Constitutional Protections– The Privileges and Immunities Clause

Art.IV Sec. 2• Discrimination against nonresidents must pass

substantial relationship test

• Fourteenth Amendment protects against state, rather than federal government

Constitutional Authority to Regulate Business

• Other Constitutional Protections– The Full Faith and Credit Clause Art. IV Sec 1

• Legal rights established in one state are honored in every other state

• Deeds, contracts, wills, judicial decisions

• Not stare decisis or binding precedent

Constitutional Authority to Regulate Business

• Other Constitutional Protections– Due Process 5th and 14th Amendments

• Procedural Due Process– Neutral decision maker

– Notice and a hearing

Constitutional Authority to Regulate Business

• Other Constitutional Protections– Due Process 5th and 14th Amendments

• Substantive Due Process– If legislation affects a fundamental right it must be

justified by a compelling or overriding state interest when challenged in court – a very difficult swtandard

– Voting, speech, privacy

– Speed limits

– Rational basis test

Constitutional Authority to Regulate Business

• Other Constitutional Protections – Equal Protection

• 14th and 5th Amendment– It is legal to treat some people differently than others,

however, the government’s reason for the grouping the people differently – into different classifications – must pass

• Strict scrutiny or

• Intermediate scrutiny or

• The rational basis test

Constitutional Authority to Regulate Business

• Other Constitutional Protections – Equal Protection

• Strict Scrutiny– Generally, government loses its argument that grouping

people into these categories promotes a compelling state interest

– Race, national origin, citizen or alien

Constitutional Authority to Regulate Business

• Other Constitutional Protections – Equal Protection

• Intermediate Scrutiny– Grouping must be substantially related to important

government objectives

• Gender, illegitimacy

Constitutional Authority to Regulate Business

• Other Constitutional Protections– Equal Protection

• The Rational Basis Test– Government generally wins because grouping only has to

have a reasonable relationship to any legitimate government objective

• Red hair, height

Constitutional Authority to Regulate Business

• Other Constitutional Protections

– Right to Privacy• No such thing in the U.S. Constitution

– Made it up from the 1st, 3rd, 4th 5th and 9th Amendments

• Tort under state law

• Abortion, birth control, gay/lesbian relationships, assisted suicide

Constitutional Authority to Regulate Business

• Constitutional Law in Cyberspace

– Regulating online obscenity• 1st Amendment issues

• Communications Decency Act

• No patently offensive “speech” to minors

• Community Standards usually govern

• ACLU v. Reno

Constitutional Authority to Regulate Business

• Cyberspace

– Cryptography and the Constitution• Encrypted data and Crim law

– 4th amendment Search and seizure questions

– 5th amendment questions

• Encryption Source Codes and Free Speech– Bernstein v. U.S. Department of State

– ITAR

Constitutional Authority to Regulate Business

• Cyberspace– Free Speech and Unwanted Electronic Mail

• Governments can restrict the time, place or manner of distribution of materials

– However, the legislation must be

• Content neutral

• Narrowly tailored

• Leave open alternative channels of communications

– Your email address?