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Write a 700- to 1,050-word paper in which you define the functions and role of law in business and society. Discuss the functions and role of law in your past or present job or industry (present job is Accountant in City Government). Properly cite at least two references from your reading.
Include an in-depth introduction and conclusion
Format your paper consistent with APA guidelines.
This is the book we are using in class:
Melvin, S. P. (2011). The legal environment of business: A managerial approach: Theory to practice. New York, NY: McGraw-Hill/Irwin
Resource: Case Brief Cipollone v. Liggett Group, Inc., et al. in Ch. 2, section 2-6, “Commerce Powers,” of the text.
COMMERCE POWERS
Congress’s broadest power is derived from the Commerce Clause whereby Congress is
given the power to “regulate Commerce among the several states.” 5 Under the modern
trend, federal courts have been largely deferential to legislative decisions under Congress’s
commerce powers. Despite some limits placed by the U.S. Supreme Court in the
relatively recent past, Congress still exercises very broad powers to pass laws where the
activity being regulated affects interstate commerce in any way.
Application of Commerce Powers
Congress exercises its commerce powers in various forms. However, the direct and broad
power to regulate all persons and products related to the flow of interstate commerce is the
fundamental source of its authority.
Interstate versus Intrastate Commercial ActivityCongress has the express constitutional
authority to regulate (1) channels of interstate commerce such as railways and highways,
(2) the instrumentalities of interstate commerce such as vehicles used in shipping, and
(3) the articles moving in interstate commerce. Even for commercial activity that is purely
intrastate (takes place within one state’s borders), Congress has the power to regulate the
activity so long as it has a substantial economic effect on interstate commerce. For example,
suppose that Congress passes the Whistleblower Act, a statute that prohibits any business
engaged in interstate commerce from firing their employees for reporting safety violations.
Steel Co., a West Virginia company, begins to engage in a pattern of firing all employees who
report safety violations. When a government agency files a civil lawsuit against Steel Co. to
enforce the Whistleblower Act, Steel Co. defends that the act is unconstitutional because the
activity of firing their employees is purely within the state of West Virginia and not related to
interstate commerce. A court would likely find that if Steel Co. had any commercial activity
at all (such as shipping, warehouses, equipment, advertising, or importing) that is outside
of West Virginia, Congress has the authority to regulate Steel Co.’s workplace policies. 6 In
the dynamics of the modern-day commercial world, a large amount of seemingly intrastate
activity has some degree of economic effect on interstate commerce.
The U.S. Supreme Court has even deferred to congressional regulation of a product
that is cultivated for noncommercial purposes solely in one state as sufficiently related to
interstate commerce. In Gonzalez v. Raich, 7 the Court ruled that Congress had the power
to criminalize the possession of marijuana even if it was noncommercially cultivated and
consumed by medical prescription all in the same state. The case involved a challenge by
two California residents to the enforcement by federal officials of the federal Controlled
Substances Act after California passed a state law via voter ballot proposition to exempt
anyone involved in the cultivating, prescribing, and consuming marijuana for medical purposes
from prosecution. The plaintiffs were each arrested by federal officials for possession
of marijuana that had been grown at home. Each had a prescription from a licensed
physician. In refusing to invalidate the Controlled Substances Act, the Court noted that
Congress could have rationally believed that the noncommercially grown marijuana would
be drawn into the interstate market and, therefore, the banning of the substance was sufficiently
related to interstate commercial activity.
Civil Rights LegislationA key use of the federal commerce power has been in the
area of civil rights legislation. Indeed, the Supreme Court’s level of deference for use of
congressional commerce powers reached its peak during and directly after the civil rights
era. In the 1964 Civil Rights Act, Congress used its commerce power to ban discrimination
in places of public accommodation such as restaurants and hotels. In two important
civil rights cases decided by the U.S. Supreme Court, the Court ruled that the Civil Rights
Act was a permissible application of Congress’s commerce powers. In Heart of Atlanta
Motel v. U.S., 8 the Court made clear that a federal ban on racial discrimination was a constitutionally
permitted use of congressional commerce powers because the hotel was open to interstate travelers. Additionally, the Court deferred to a congressional finding of fact
that racial discrimination in accommodations discouraged travel by limiting a substantial
portion of the black community’s ability to find suitable lodging. In a companion case, 9
Katzenbach v. McClung, 10 the Court held that a local restaurant that was located far from
any interstate highway, and with no appreciable business from interstate travelers, was
nevertheless subject to the reach of the federal statute because the restaurant purchased
some food and paper supplies from out-of-state vendors. Since these purchases were of
items that had moved in commerce, Congress could properly exercise their power to regulate
a restaurant whose business interests were primarily local.
Noncommercial ActivityIn 1995, the U.S. Supreme Court signaled that some limits
on Congress’s commerce power still exist. In cases where the activity is purely noncommercial
(such as when Congress passes a criminal statute that is seemingly unrelated to
commerce), the Court has used increased levels of scrutiny to be
sure that the activity that Congress seeks to regulate has a sufficient
nexus (connection) to some legitimate economic interest. In U.S.
v. Lopez, 11 the Court invalidated a federal statute on the basis that
it was beyond Congress’s commerce powers. In Lopez, the Court
struck down the Gun-Free School Zones Act of 1990, which made
it a federal crime to possess a gun within a certain distance from
a school. The Court rejected the government’s argument that gun
possession in schools affected economic productivity (by making it more difficult for students
to obtain an education) and thus was within the purview of congressional commerce
power. The Court held that such a broad interpretation of the commerce power would mean
that congressional power was virtually unlimited, and that such an expansive authority was
directly contrary to the express limits imposed by the Constitution. The court reasoned that
the banning of firearms in local schools was a government police power and, therefore,
more appropriately handled by the state government. Five years later, in U.S. v. Morrison,
the Court invalidated another statute on the same grounds. In that case, the Court struck
down the Violence Against Women Act, which gave victims of gender-motivated violence
the right to sue their attacker for money damages in a federal court. In light of the Lopez
decision, Congress made exhaustive findings of fact that detailed the cumulative economic
affect of gender-motivated crimes. Nonetheless, the Court held that the congressional findings
were too broad to justify use of the commerce power and that virtually any local crime
could become a federal offense under a similar justification. As a general rule, the further
that Congress strays from regulating commercial activity, the more likely the Court will be
to give the law intense constitutional scrutiny.
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