Gibbons v. Ogden

Explanation and Analysis of the Document

Chief Justice John Marshall’s Opinion for the Court

John Marshall delivered the unanimous opinion against Aaron Ogden on March 2, 1824. Marshall begins by acknowledging that the monopoly had been supported “by names which have all the titles to consideration that virtue, intelligence, and office, can bestow,” yet the Supreme Court still had the constitutional obligation to hear the case. He then upholds a broad view of the Constitution, stating that all power over interstate commerce had been given to Congress with the ratification of the Constitution. Out of necessity, the Constitution gave the federal government broad powers; to limit Congress to its enumerated powers “would cripple the government and render it unequal to the object for which it is declared to be instituted.” In plain language, the Founders had granted Congress the power to “regulate commerce with foreign nations, and among the several States, and with the Indian tribes.” They had understood that “commerce, undoubtedly, is traffic, but it is something more: it is intercourse.” As such, Congress could regulate both the buying and selling of goods and the transportation of passengers and cargo across state lines. Since such commerce occurred “among” or “intermingled with” the states, congressional commerce power could “not stop at the external boundary line of each State, but may be introduced into the interior.” Marshall concedes that states could pass safety or inspection laws based on their police powers. However, this did not give them concurrent powers over interstate commerce. Congress could recognize such state regulations and even give them the status of federal law as needed, but Congress still maintained ultimate control over interstate trade.

Marshall briefly considers whether the commerce clause by itself is enough to invalidate all attempts at concurrent state regulation. Nevertheless, the central point remains whether the New York monopoly impeded congressional authority. The Coasting Trade and Fisheries Act of 1793 gave registered vessels not only the status of American ships but also the right to travel between ports in different states. The act makes no mention of what such ships might be carrying in their holds or how they might be powered. Marshall concludes with a condemnation of states’ rights activists who supported the monopoly, referring to them as “powerful and ingenious minds, taking as postulates that the powers expressly granted to the government of the Union are to be contracted by construction into the narrowest possible compass.” Such individuals, Marshall warns, would “explain away the Constitution of our country and leave it a magnificent structure indeed to look at, but totally unfit for use.” The New York steamboat monopoly, he concludes, is unconstitutional and invalid.

William Johnson’s Concurrence

Justice William Johnson’s concurring opinion in Gibbons v. Ogden begins with an expression of support for Marshall’s decision; he then stresses the need to state his own views on the matter. Johnson eschews both broad and strict interpretations of the Constitution, stating that the “simple, classical, precise, yet comprehensive language in which it is couched leaves, at most, but very little latitude for construction.” The Founders had created the Constitution to “unite this mass of wealth and power, for the protection of the humblest individual, his rights, civil and political, his interests and prosperity, are the sole end; the rest are nothing but the means.” To overcome the economic rivalries of the era of the Articles of Confederation, the framers had given Congress extensive and complete control over interstate commerce. Such power obviously included the right to regulate navigation and commerce. This broad authority automatically swept away the New York monopoly, regardless of the Coasting Trade and Fisheries Act of 1793. In fact, Congress had created the coasting act to promote national trade, making any attempts at state regulation moot. To be certain, federal and state commerce powers intersected in some cases: “Wherever the powers of the respective governments are frankly exercised, with a distinct view to the ends of such powers, they may act upon the same object, or use the same means, and yet the powers be kept perfectly distinct.” Ultimately, however, state power had to give way to federal authority. After concluding his defense of federal commerce powers, Johnson begs off a discussion on federal patent law.

Decree

The case concludes with John Marshall’s decree of the Supreme Court. He reexamines the background of the case and his own decision, concluding that the Coasting Trade and Fisheries Act of 1793 granted Gibbons the right to trade in New York waters, state laws notwithstanding. The New York steamboat monopoly was accordingly “erroneous, and ought to be reversed, and the same is hereby reversed and annulled: and this Court doth further DIRECT, ORDER, and DECREE that the bill of the said Aaron Ogden be dismissed, and this same is hereby dismissed accordingly.”

Additional Commentary by Herbert A. Johnson, University of South Carolina, Emeritus

Gibbons v. Ogden (1824) arose from the New York legislature’s grant of a monopoly on steamboat navigation within the state as a reward for the successful establishment of such travel on a regular basis between New York City and Albany. Originally offered to the inventor John Fitch, the grant was about to lapse when the partnership of the former New York chancellor Robert R. Livingston and the engineer Robert Fulton obtained a transfer of Fitch’s rights. Their successful demonstration of compliance in 1807 gave them a New York monopoly to traverse the Hudson River, Long Island Sound, and all other navigable waters within the Empire State. In addition, in 1809 Robert Fulton’s improvements upon earlier steamboat designs resulted in the grant of a U.S. patent for the partnership’s steamboat. However, the value of steam navigation, particularly on the Mississippi River watershed, and interstate retaliation against New York’s monopoly grant encouraged competitors to enter the steamboat business in New York Bay and Long Island Sound.

Strong antimonopoly sentiments in the Midwest and Southwest, augmented by innovative steamboat designs by and sharp competition from Henry Shreve, made it difficult for the Livingston-Fulton syndicate to defend their enterprise in western waters. After 1817 the steamboat route between Elizabeth, New Jersey, and New York City became the focus of extended litigation. Ultimately, a Livingston-Fulton licensee, Aaron Ogden, sued a competitor, Thomas Gibbons, for violation of the New York monopoly grant, and Gibbons defended himself by claiming the protection of the commerce clause and the 1793 Act for Enrolling and Licensing Ships or Vessels to be Employed in the Coasting Trade and Fisheries, and for Regulating the Same, commonly known as the Federal Coasting Licensing Act. Chancellor James Kent awarded an injunction against Gibbons and upheld the constitutionality of the New York monopoly. Gibbons’s appeal to New York’s Court for the Trial of Impeachments and the Correction of Errors was rejected in January 1822, and the case was carried to Marshall’s Supreme Court, where it was argued in February 1824.

Even before it was argued in the Supreme Court, Gibbons attracted widespread attention. The navigation of the Hudson River and New York Bay involved substantial profits that could be enhanced only with the completion of the Erie Canal, which would occur in 1825. New Jersey and Connecticut, the states directly affected by the New York monopoly, retaliated against New York steamboat operators who ventured into their territorial waters. Gibbons and his associates gained newspaper publicity and popular approval with their daring maritime challenges to the Livingston-Fulton syndicate. Human interest was sparked by the personal feud between Thomas Gibbons and Aaron Ogden, which at one point threatened to erupt into a duel. As if this background to the litigation were not sufficient to earn national attention, the parties each recruited leading members of the Supreme Court bar to argue on their behalf. Gibbons’s appeal was presented by Daniel Webster and U.S. Attorney General William Wirt; Thomas J. Oakley and Thomas Addis Emmet appeared on behalf of Aaron Ogden. The Court took three weeks to deliver its March 2 opinion and enter judgment, which reversed the decision of the New York Court of Impeachments and Errors and nullified the New York monopoly.

The chief justice opens the Court’s opinion with a terse rejection of the compact theory of government advocated by Ogden’s counsel in support of New York’s grant of a monopoly despite the existence of the commerce clause in the federal Constitution. Having settled that point once more, he proceeds to define commerce and to consider the component parts of commercial activity. Counsel for the Livingston-Fulton syndicate argued strongly that commercial activity did not include navigation but was restricted to the buying and selling of goods, the interchange of goods, and contractual aspects of traffic. Appealing to general understanding, the chief justice insists that commerce has always been understood to include navigation; this is also shown through the exceptions from Congress’s authority over commerce delineated in the Constitution. Specifically, in regulating commerce, Congress is prohibited from giving a preference to one port over another. Even more pointedly, the Constitution prevents commercial regulation that would require a vessel bound for one state to enter, clear, or pay duties in another state. Marshall’s use of commonly accepted meanings of words and his examination of the “four corners” of the federal Constitution for indications of meaning were hallmarks of his jurisprudential method. This approach permitted him to arrive at definitions that were both accurate and in accord with constitutional intent.

He next considers the extent of Congress’s power to regulate commerce. Even before the ratification of the Constitution, Congress’s authority was broadly construed to include every aspect of commercial intercourse between the United States and foreign nations. Since both foreign commerce and commerce “among the states” are grouped together in the same sentence in the Constitution, the generous interpretation of the term commerce established by Marshall must be applicable to interstate commerce. The word among, meanwhile, encompasses trade concerning more than one state while precluding congressional regulation of activity solely within the interior of a single state. Marshall asserts that the Constitution was not intended to give Congress the power to regulate commerce activities completely “within a particular State which do not affect other States, and with which it is not necessary to interfere for the purpose of executing some of the general powers of the [U.S.] government.” In other words, Congress’s regulatory power extends to commerce internal to a state only if the commerce “affects” a sister state or interferes with the execution of the general authority vested in the U.S. government. The Constitution does not apply a rigid geographic measure to what qualifies as commerce “among the states.” Rather, it requires that courts examine the degree to which state economic regulations affect the general welfare of associated states and the constitutional authority of the federal government.

Marshall then examines the comprehensive nature of Congress’s authority to regulate, asking whether that power is exclusive or concurrent with the states. Examining the concurrent taxing power vested in both the U.S. and state governments, he indicates that the power to tax is essential to the existence of both federal and state governments and is exercised without the danger that one government’s authority might be usurped by the other. On the other hand, state regulations of foreign or interstate commerce always trespass upon the constitutional power of Congress. As such, they are invalid under the supremacy clause of the Constitution. Conceding that Congress might elect to assist the states in the execution of their reserved powers and noting that Congress might also adopt state legislation as part of the federal regulation of commerce, Marshall nevertheless insists that these cooperative procedures between the states and the federal government do not demonstrate equal concurrency of federal and state power over foreign or interstate commerce. Quite to the contrary, these examples of intergovernmental cooperation arise from the differing sources of police power reserved to the states, on one hand, and, on the other hand, from the federal government’s constitutional power over commerce. Absent any adverse impact upon the authority of the federal government, these overlapping powers might coexist. Whenever there is an adverse impact, however, the Constitution’s supremacy clause invalidates the state legislation.

The chief justice finally considers counsels’ contention that, by its terms alone, the Constitution prohibits the states from regulating interstate commerce. This was an assertion of what future scholars would term the “dormancy” view of the commerce clause, which states that the mere grant of the commerce power in the Constitution prohibits the states from acting in that area. In effect, this view reserves to Congress a preemptive right to legislate with regard to interstate commerce, excluding the states from any legislative authority because of the existence of this power, however unexercised. In the Gibbons opinion, Marshall takes refuge in the 1793 Federal Coasting Licensing Act and finds it to be a comprehensive conferral of navigation rights upon all licensees. He holds that as the possessor of such a license, Thomas Gibbons was granted the right to navigate between New York City and Elizabeth, New Jersey. The New York monopoly conflicted with those statutory federal rights and thus violated the commerce clause of the Constitution.

Gibbons is as important for what it does not decide as for what it does decide. It provides a broad and pragmatic definition of the commerce clause as it relates to both foreign commerce and trade “among the states,” and it applies principles of the supremacy clause to invalidate state action that “affects” foreign and interstate commerce. In doing so, the decision establishes a firm foundation upon which future constitutional theory could be built. At the same time, its ambiguities leave much room for future judicial elaboration; this is true of Marshall’s refusal to hold the commerce clause as ipso facto conferring an exclusive power upon Congress, and it also applies to the Court’s unwillingness to comment upon the dormancy construction of the Constitution’s grant of power. Thus, Marshall’s opinion stands as but the beginning of what would be the Supreme Court’s extended elaboration of the scope and applicability of the commerce clause. As such, it is perhaps the most noteworthy of Marshall’s opinions when measured by its present-day impact on American economic life and social legislation.