Brief Fact Summary. Hood & Sons (Hood) distributed milk and milk products to the Boston area. They operated three receiving depots in New York State and wanted to open a fourth. They were denied a permit because of a New York statute stating that a license to open the depot should not be given if it would disrupt competition in a market already adequately served.
Synopsis of Rule of Law. Under the Dormant Commerce Clause, a State may not use its admitted powers to protect the health and safety of its people as a basis for suppressing competition.
Issue. Did the local legislation restricting the issuance of licenses when a new entity would have a destructive impact on competition violate the Commerce Clause?
Held. Justice Jackson’s opinion: Yes. Lower court judgment reversed and cause remanded.
This case does not address regulations designed to assure sanitary and modernly equipped handlers. Rather, it addresses concerns over the additional restrictions designed to curtail the volume of interstate commerce to aid local economic interests.
The Commerce Clause is violated when the law does not allow every farmer and every craftsman to produce knowing that he will have free access to every market in the Nation, with no embargos, customs duties, or regulations. The law also restrains consumers because they may not look to free competition to protect themselves from exploitation by any one producer.
Such was the vision of the Founders; such has been the doctrine of this Court which has given it reality.View Full Point of Law