Dean Milk Co. v. Madison

340 U.S. 349 (1951)

(Dormant Commerce Clause)

 

Context

In Madison, Wisconsin, the sale of milk was regulated by a city ordinance requiring the milk to be sourced within a five mile radius of the center of the city or pasteurized within the same radius. Dean Milk Co, an Illinois company, sold milk that was pasteurized and sourced far outside the radius, 65-85 miles away. Madison would not allow Dean Milk Co. to sell their milk products within city limits. Dean Milk Co. filed suit against the city on the grounds that the ordinance interfered with interstate commerce. The court agreed with Dean Milk Co. and struck down the Madison, WI ordinance. The majority said that the ordinance discriminated against non-local competitors and threatened interstate commerce as the basic effect of the ordinance was to stop the flow of commerce into the city. The majority came to their conclusion by weighing the intent of the ordinance against less restrictive alternatives to the ordinance and using the Dormant Commerce Clause which questioned the ordinance’s effect on discriminating against out-of-state trade. The ordinance not only discriminated out-of-state trade but also in-state trade that did not fit the 5-mile radius. Three Justices dissented, arguing that the city’s interest in making sure the milk is healthy and safe to consume for citizens outweighs their interest in maintaining interstate commerce.

 

Facts:

This appeal challenges the constitutional validity of two sections of an ordinance of the City of Madison, Wisconsin, regulating the sale of milk and milk products within the municipality's jurisdiction. One section in issue makes it unlawful to sell any milk as pasteurized unless it has been processed and bottled at an approved pasteurization plant within a radius of five miles from the central square of Madison. Another section, which prohibits the sale of milk, or the importation, receipt or storage of milk for sale, in Madison unless from a source of supply possessing a permit issued after inspection by Madison officials, is attacked insofar as it expressly relieves municipal authorities from any duty to inspect farms located beyond twenty-five miles from the center of the city.

Appellant is an Illinois corporation engaged in distributing milk and milk products in Illinois and Wisconsin. It contended below, as it does here, that both the five-mile limit on pasteurization plants and the twenty-five-mile limit on sources of milk violate the Commerce Clause and the Fourteenth Amendment to the Federal Constitution. The Supreme Court of Wisconsin upheld the five-mile limit on pasteurization.

The City of Madison is the county seat of Dane County. Within the county are some 5,600 dairy farms with total raw milk production in excess of 600,000,000 pounds annually and more than ten times the requirements of Madison. Aside from the milk supplied to Madison, fluid milk produced in the county moves in large quantities to Chicago and more distant consuming areas, and the remainder is used in making cheese, butter, and other products. At the time of trial, the Madison milkshed was not of "Grade A" quality by the standards recommended by the United States Public Health Service, and no milk labeled "Grade A" was distributed in Madison.

The area defined by the ordinance with respect to milk sources encompasses practically all of Dane County and includes some 500 farms which supply milk for Madison. Within the five-mile area for pasteurization are plants of five processors, only three of which are engaged in the general wholesale and retail trade in Madison. Inspection of these farms and plants is scheduled once every thirty days and is performed by two municipal inspectors, one of whom is full-time. The courts below found that the ordinance in question promotes convenient, economical and efficient plant inspection.

Appellant purchases and gathers milk from approximately 950 farms in northern Illinois and southern Wisconsin, none being within twenty-five miles of Madison. Its pasteurization plants are located at Chemung and Huntley, Illinois, about 65 and 85 miles respectively from Madison. Appellant was denied a license to sell its products within Madison solely because its pasteurization plants were more than five miles away.

It is conceded that the milk which appellant seeks to sell in Madison is supplied from farms and processed in plants licensed and inspected by public health authorities of Chicago and is labeled "Grade A" under the Chicago ordinance which adopts the rating standards recommended by the United States Public Health Service. Both the Chicago and Madison ordinances, though not the sections of the latter here in issue, are largely patterned after the Model Milk Ordinance of the Public Health Service. However, Madison contends and we assume that in some particulars its ordinance is more rigorous than that of Chicago.

Dean Milk Co. v. Madison

Issue:

Upon these facts, we find it necessary to determine only the issue raised under the Commerce Clause, for we agree with appellant that the ordinance imposes an undue burden on interstate commerce.

Reasoning:

There is no pertinent national regulation by the Congress, and statutes enacted for the District of Columbia indicate that Congress has recognized the appropriateness of local regulation of the sale of fluid milk. It is not contended, however, that Congress has authorized the regulation before us.

Nor can there be objection to the avowed purpose of this enactment. We assume that difficulties in sanitary regulation of milk and milk products originating in remote areas may present a situation in which "upon a consideration of all the relevant facts and circumstances it appears that the matter is one which may appropriately be regulated in the interest of the safety, health, and well-being of local communities . . .."

But this regulation in practical effect excludes from distribution in Madison wholesome milk produced and pasteurized in Illinois. In thus erecting an economic barrier protecting a major local industry against competition from without the State, Madison plainly discriminates against interstate commerce. This it cannot do, even in the exercise of its unquestioned power to protect the health and safety of its people, if reasonable nondiscriminatory alternatives, adequate to conserve legitimate local interests, are available. A different view, that the ordinance is valid simply because it professes to be a health measure, would mean that the Commerce Clause of itself imposes no limitations on state action other than those laid down by the Due Process Clause, save for the rare instance where a state artlessly discloses an avowed purpose to discriminate against interstate goods. Our issue then is whether the discrimination inherent in the Madison ordinance can be justified in view of the character of the local interests and the available methods of protecting them.

It appears that reasonable and adequate alternatives are available. If the City of Madison prefers to rely upon its own officials for inspection of distant milk sources, such inspection is readily open to it without hardship for it could charge the actual and reasonable cost of such inspection to the importing producers and processors.

To permit Madison to adopt a regulation not essential for the protection of local health interests and placing a discriminatory burden on interstate commerce would invite a multiplication of preferential trade areas destructive of the very purpose of the Commerce Clause. Under the circumstances here presented, the regulation must yield to the principle that "one state in its dealings with another may not place itself in a position of economic isolation."

Holding:

The judgment below sustaining the five-mile provision as to pasteurization must be reversed.

 

Key Takeaway

If (a) a city ordinance imposes a discriminatory burden on interstate commerce and (b) the ordinance isn’t essential for the protection of local health interests, then it violates the Commerce Clause.


Court Syllabus:

1. An ordinance of a Wisconsin municipality forbids the sale of milk in the city as pasteurized unless it has been pasteurized and bottled at an approved pasteurization plant within five miles of the center of the city. Appellant, an Illinois corporation engaged in gathering and distributing milk from farms in Illinois and Wisconsin, was denied a license to sell its products within the city solely because its pasteurization plants were more than five miles away. 

 Held: The ordinance unjustifiably discriminates against interstate commerce, in violation of the Commerce Clause of the Federal Constitution.

(a) Even in the exercise of its unquestioned power to protect the health and safety of its people, a municipality may not erect an economic barrier protecting a major local industry against competition from without the state, if reasonable nondiscriminatory alternatives, adequate to conserve legitimate local interests, are available.

(b) In view of the reasonable and adequate alternatives which are available for the protection of the health and safety of the people of the municipality, the discrimination against interstate commerce inherent in the ordinance violates the Commerce Clause.

2. A second provision of the ordinance in question forbids the sale of milk, or the importation, receipt or storage of milk for sale, within the city except from a source of supply possessing a permit issued after inspection by city officials; and expressly relieves the city officials from any duty to inspect farms located beyond twenty-five miles from the city. Appellant's attack on the constitutional validity of this provision was dismissed by the state court for want of a justiciable controversy.

 Held: As to the issue thus presented, the cause is remanded for further proceedings not inconsistent with the principles announced in the opinion of this Court.


How the Justices Voted

Majority: Clark, joined by Vinson, Reed, Frankfurter, Jackson, Burton

Dissent: Black, joined by Douglas, Minton